- 73% Increase in Net Income Leads to Record First Quarter Results - 2008 Guidance Increased
SAN CARLOS, Calif., May 01, 2008 (BUSINESS WIRE) -- Natus Medical Incorporated (Nasdaq:BABY) today announced financial
results for the three months ended March 31, 2008.
For the first quarter ended March 31, 2008, revenue increased 36%
to $36.9 million, compared to $27.1 million reported in the comparable
quarter of the previous year. Net income increased 73% to $2.6
million, or $0.11 per diluted share, for the first quarter of 2008,
compared with net income of $1.5 million, or $0.07 per share, for the
first quarter of 2007.
Jim Hawkins, President and Chief Executive Officer of the Company
said, "I am very pleased with our results for the first quarter of
2008. We had an excellent first quarter led by strong sales of our
newborn hearing screening products. A highlight was the introduction
of the ALGO 5, our next generation hearing screener. We also were able
to resume domestic shipments of the Olympic Cool-Cap during the
quarter, filling substantially our entire backlog.
"We completed the integration of Xltek ahead of schedule, with
Xltek contributing to both the revenue and earnings growth during the
quarter. Our world class sales organization again showed their ability
to add new products while increasing sales, as we successfully
realigned our domestic sales organizations into two distinct groups
focused on Newborn Care and Neurology," added Hawkins. "We also
recently announced our agreement to acquire Sonamed, a manufacturer of
hearing screening products, which we expect to close by the end of
May. Sonamed's device and disposable supply model with high gross
profits is an ideal fit for Natus.
"I remain very excited and optimistic for our prospects in 2008 as
we look to achieve our goal of 50% earnings growth. We continue to
remain confident in our strategy of combining internal growth with
accretive acquisitions to build a focused and highly profitable
medical device company," said Hawkins.
As of March 31, 2008 the Company had cash, cash equivalents, and
short-term investments of $12.6 million, revolving and term debt of
$35.6 million, stockholders' equity of approximately $118 million, and
working capital of approximately $22 million. The Company raised
approximately $15.4 million in April 2008 in a public offering of
885,500 shares of its common stock.
2008 Guidance
Natus increased its revenue and earnings guidance for the full
year 2008. For the full year 2008, the Company now expects revenue to
range from $161 million to $162 million and earnings per share to
range from $0.70 to $0.72. The Company had previously said revenue
would be approximately $160 million and earnings per share would range
from $0.68 to $0.70.
Natus also announced revenue and earnings guidance for the second
quarter of 2008. For the second quarter 2008, the Company expects
revenue to range from $38.0 million to $39.0 million and earnings per
share to range from $0.14 to $0.15. This compares to revenue of $28.3
million and earnings per share of $0.10 reported in the second quarter
of 2007.
The Company's 2008 guidance does not include the impact of the
acquisition of Sonamed. Natus plans to update its annual guidance
after the Sonamed acquisition closes. The guidance is on a GAAP basis,
including the impact of expensing employee equity-based compensation,
however it does not include the impact of any one-time acquisition or
restructuring related charges that may be incurred in 2008. All
earnings per share amounts are on a diluted basis.
Conference Call
Natus has scheduled an investment-community conference call to
discuss this announcement beginning at 11:00 a.m. Eastern Time today
(8:00 a.m. Pacific Time). Individuals interested in listening to the
conference call may do so by dialing (866) 510-0711 for domestic
callers, or (617) 597-5379 for international callers, and entering
reservation code 95788733. A telephone replay will be available for 48
hours following the conclusion of the call by dialing (888) 286-8010
for domestic callers, or (617) 801-6888 for international callers, and
entering reservation code 81347534.
The conference call also will be available real-time via the
Internet at http://investor.natus.com, and a recording of the call
will be available on the Company's Web site for 90 days following the
completion of the call.
About Natus Medical Incorporated
Natus is a leading provider of healthcare products used for the
screening, detection, treatment, monitoring and tracking of common
medical ailments such as hearing impairment, neurological dysfunction,
epilepsy, sleep disorders, and newborn care. Product offerings include
computerized neurodiagnostic systems for audiology, neurology,
polysomnography, and neonatology, as well as newborn care products
such as hearing screening systems, phototherapy devices for the
treatment of newborn jaundice, head-cooling products for the treatment
of brain injury in newborns, and software systems for managing and
tracking disorders and diseases for public health laboratories.
Additional information about Natus Medical can be found at
www.natus.com.
This press release contains forward-looking statements as defined
in the Private Securities Litigation Reform Act of 1995, particularly
statements regarding the expectations, beliefs, plans, intentions and
strategies of Natus. These forward-looking statements include, but are
not limited to, statements regarding completion of the Sonamed
transaction, future revenue and earnings growth, and anticipated
revenue and profitability for the second quarter and full year 2008.
These statements relate to future events or Natus' future financial
performance or results, and involve known and unknown risks,
uncertainties and other factors that may cause actual results, levels
of activity, performance, or achievements to differ materially from
those expressed or implied by the forward-looking statements.
Forward-looking statements are only predictions and the actual events
or results may differ materially. Natus cannot provide any assurance
that its future results or the results implied by the forward-looking
statements will meet expectations. Our future results could differ
materially due to a number of factors, including the effects of
competition, the demand for our products and services, our ability to
expand our sales in international markets, our ability to maintain
current sales levels in a mature domestic market, our ability to
control costs, and risks associated with bringing new products to
market and integrating acquired businesses. Natus disclaims any
obligation to update information contained in any forward-looking
statement.
More information about potential risk factors that could affect
the business and financial results of Natus is included in Natus'
annual report on Form 10-K for the year ended December 31, 2007, and
its quarterly reports on Form 10-Q, and in other reports filed from
time to time by Natus with the U.S. Securities and Exchange
Commission.
NATUS MEDICAL INCORPORATED AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three Months Ended
March March
2008 2007
-------- --------
Revenue $36,859 $27,050
Cost of revenue 14,005 10,175
-------- --------
Gross profit 22,854 16,875
-------- --------
Operating expenses:
Marketing and selling 9,876 6,496
Research and development 3,827 3,824
General and administrative 4,856 4,108
-------- --------
Total operating expenses 18,559 14,428
-------- --------
Income from operations 4,295 2,447
-------- --------
Other income/(expense):
Interest income 138 186
Interest expense (545) -
Other income, net 408 55
-------- --------
Total other income/(expense) 1 241
-------- --------
Income before provision for income tax 4,296 2,688
Provision for income tax 1,669 1,169
-------- --------
Net income (loss) $2,627 $1,519
======== ========
Earnings (loss) per share:
Basic $0.12 $0.07
Diluted $0.11 $0.07
Weighted-average shares used to compute
Basic earnings per share 21,742 21,466
Diluted earnings per share 22,977 22,734
SOURCE: Natus Medical Incorporated
Natus Medical Incorporated
Steven J. Murphy, Chief Financial Officer, 650-802-0400
InvestorRelations@Natus.com
