Fourth Quarter Revenues Increase 35%, Net Income More than Doubles
BURLINGTON, Mass., Feb. 4 /PRNewswire-FirstCall/ -- Palomar Medical
Technologies Inc (Nasdaq: PMTI), a leading researcher and developer of light-
based systems for hair removal and other cosmetic treatments, today announced
financial results for the fourth quarter and year ended December 31, 2003. For
the fourth quarter ended December 31, 2003, the Company's total revenues
increased by 35 percent, its product revenues increased by 26 percent and its
gross profit from product sales improved by 34 percent, compared to the fourth
quarter of 2002. For the year ended December 31, 2003, the Company's total
revenues increased by 37 percent, its product revenues increased by 39 percent
and its gross profit from product sales improved by 61 percent, compared to
the year ended December 31, 2002. The Company realized a significant increase
in net income to $1.0 million, a 137 percent improvement over the fourth
quarter of 2002 and for the year increased 85 times to $3.3 million from
$39,000. Over the past year, product gross margins have improved significantly
due to a higher margin product mix and the effects of increased sales volume.
The Company has also strengthened its balance sheet since the end of last
year, including more than doubling its cash position and more than tripling
stockholders' equity. The current ratio is now 2.9x, up substantially from
1.5x at the end of 2002, and there is no long-term debt.
Chief Executive Officer Joseph P. Caruso commented, "I am pleased to
report on Palomar's progress during the fourth quarter of 2003 and the full
fiscal year, which included some major milestones. A year ago, the Company
announced an agreement with The Gillette Company (NYSE: G) to complete
development and commercialize a patented home-use, light-based hair removal
device for women. In our base business, gross margins on product sales reached
60 percent, which compares quite favorably with our competitors' margins. And
thanks to the market's enthusiastic reception of our expanding Lux line of
products, we doubled the size of our domestic sales force at the end of the
year."
Caruso continued, "Especially encouraging is the fact that our revenues
continue to increase at a rapid rate, allowing us to maintain our research and
development effort. Our reputation for leading-edge technology and product
reliability has resulted in increased market share for Palomar over the past
two years in the expanding market for light-based cosmetic procedures, a trend
we think will continue in 2004. We also expect to keep extending the
applications of our technology during upcoming quarters, and the strength of
our balance sheet should allow us to continue to compete strongly in this
dynamic market."
Revenues for the quarter ended December 31, 2003, were $10.1 million, up
from $7.5 million in the fourth quarter of 2002. Gross profit from product
sales increased to $5.5 million (60 percent of product revenues), up from $4.1
million (57 percent of product revenues) in the year-earlier quarter. The
Company reported net income of $1.0 million, or $0.06 per diluted share, for
the fourth quarter of this year, versus net income of $437,000, or $0.04 per
diluted share, for the fourth quarter of last year.
Revenues for the year ended December 31, 2003, were $34.8 million, up from
$25.4 million for the year ended December 31, 2002. Gross profit from product
sales increased to $18.3 million (58 percent of revenues), up from $11.3
million (50 percent of revenues) in the year-earlier period. The Company
reported net income of $3.4 million, or $0.21 per diluted share, for the year
ended December 31, 2003, versus net income of $39,000, or $0.00 per diluted
share, for the year ended December 31, 2002.
Commenting on Palomar's ongoing program to expand its shareholder base,
Chief Financial Officer Paul S. Weiner concluded, "The recent strong operating
and financial performance at Palomar have been noticed by the investment
community, and during 2003 we substantially increased the institutional
following of the Company. We are continuing our efforts to expand our
shareholder base with an ongoing program of meetings with professional money
managers and analysts nationwide. We are currently scheduling our next round
of meetings at this year's Annual Meeting of the American Academy of
Dermatology (AAD), to be held in Washington, DC, from February 7 to 10, 2004.
To reserve a time to meet with Palomar management and/or receive product
demonstrations, please contact Palomar's Investor Relations department at 781-
993-2411. At the meeting, Palomar will introduce it's next generation of Lux
pulsed-light system."
Conference Call: As previously announced, Palomar will conduct a
conference call and webcast today at 1:00 PM Eastern Time. Management will
discuss financial results and strategic matters. If you would like to
participate, please call (888) 339-2688 or listen to the webcast in the
Investor Relations section of the Company's website at http://www.palomarmedical.com.
The telephone replay will be available one hour after the call at (888) 286-
8010 passcode 45088229 and will continue through Tuesday, February 17, 2004.
A webcast replay will also be available.
About Palomar Medical Technologies Inc: Palomar is a leading researcher
and developer of light-based systems for hair removal and other cosmetic
treatments. In 2003, Palomar and The Gillette Company (NYSE: G) entered into
an agreement to complete development and commercialize a patented home-use,
light-based hair removal device for women. New and exciting indications are
being tested to further advance the hair removal market and other cosmetic
applications. Palomar pioneered the optical hair removal field, when, in 1996,
it introduced the first high-powered laser hair removal system. Since then,
many of the major advances in light-based hair removal have been based on
Palomar technology. There are now millions of light-based hair removal
procedures performed around the world every year in physician offices,
clinics, spas and salons.
For more information on Palomar and its products, visit Palomar's website
at http://www.palomarmedical.com. To continue receiving the most up-to-date
information and latest news on Palomar as it happens, sign up to receive
automatic e-mail alerts by going to the E-mail Alerts page in the Investor
Relations section of the website.
With the exception of the historical information contained in this
release, the matters described herein contain forward-looking statements,
including but not limited to statements relating to new markets, development
and introduction of new products, and financial projections that involve risk
and uncertainties that may individually or mutually impact the matters herein,
and cause actual results, events and performance to differ materially from
such forward-looking statements. These risk factors include, but are not
limited to, results of future operations, technological difficulties in
developing or introducing new products, the results of future research, lack
of product demand and market acceptance for current and future products, the
effect of economic conditions, challenges in managing joint ventures and
research with third parties, the impact of competitive products and pricing,
governmental regulations with respect to medical devices, including whether
FDA clearance will be obtained for future products, the results of litigation,
difficulties in collecting royalties, potential infringement of third-party
intellectual property rights, and/or other factors, which are detailed from
time to time in the Company's SEC reports, including the report on Form 10-K
for the year ended December 31, 2002 and the Company's quarterly reports on
Form 10-Q. Readers are cautioned not to place undue reliance on these forward-
looking statements, which speak only as of the date hereof. The Company
undertakes no obligation to release publicly the result of any revisions to
these forward-looking statements that may be made to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
Palomar Financial Summary (Amounts in thousands, except per share data):
Consolidated Statements of Operations (Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2003 2002 2003 2002
Revenues:
Product revenues $9,184,939 $ 7,288,655 $31,332,125 $22,548,451
Royalty revenues 192,169 177,254 840,614 2,869,085
Funded product
development
revenues 700,000 - 2,600,000 -
Total revenues 10,077,108 7,465,909 34,772,739 25,417,536
Costs and expenses:
Cost of product
revenues 3,642,196 3,139,537 13,031,316 11,200,077
Cost of royalty
revenues 76,867 70,902 336,245 1,147,635
Research and
development 1,858,821 1,064,705 6,057,987 4,359,346
Selling and
marketing 2,414,972 1,969,230 8,483,138 5,785,326
General and
administrative 1,017,606 826,321 4,255,487 3,066,945
Total costs and
expenses 9,010,462 7,070,695 32,164,173 25,559,329
Income (loss) from
operations 1,066,646 395,214 2,608,566 (141,793)
Interest income 20,262 16,324 74,006 73,647
Interest expense (1,521) (32,723) (28,340) (119,379)
Other income - 58,333 58,333 226,638
Income from
operations 1,085,387 437,148 2,712,565 39,113
Benefit (provision)
for income taxes (48,000) - 656,521 -
Net income $1,037,387 $437,148 $ 3,369,086 $39,113
Net income per share:
Basic $0.07 $0.04 $0.25 $ -
Diluted $0.06 $0.04 $0.21 $ -
Weighted average number of shares outstanding:
Basic 14,308,537 11,534,631 13,399,178 11,372,228
Diluted 16,789,466 12,018,011 15,917,392 11,582,166
Consolidated Balance Sheets (Unaudited)
December 31, December 31,
2003 2002
Assets
Current assets:
Cash and cash equivalents $10,558,946 $4,450,076
Accounts receivable,
net of allowance of $862,114
and $553,559, respectively 6,637,246 4,047,277
Inventories 3,385,316 3,847,493
Other current assets 384,785 269,940
Total current assets 20,966,293 12,614,786
Property and equipment, net 582,898 485,286
Other assets 111,074 298,268
Total Assets $21,660,265 $13,398,340
Liabilities and Stockholders' Equity
Current liabilities:
Note payable to related party $- $1,000,000
Accounts payable 655,923 1,320,202
Accrued liabilities 4,979,896 4,619,303
Deferred income taxes 1,100,000 1,400,000
Deferred revenue 560,897 341,084
Total current liabilities 7,296,716 8,680,589
Stockholders' equity:
Common stock, $.01 par value-
Authorized - 45,000,000 shares
Issued - 14,554,407 and 11,538,706
shares, respectively 145,544 115,387
Additional paid-in capital 168,267,820 162,021,265
Accumulated deficit (154,049,815) (157,418,901)
Total stockholders' equity 14,343,549 4,717,751
Total liabilities and stockholders' equity $21,660,265 $13,398,340
Contacts:
Paul S. Weiner
Chief Financial Officer
Palomar Medical Technologies Inc
781-993-2411
ir@palomarmedical.com
SOURCE Palomar Medical Technologies, Inc
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http://www.palomarmedical.com
Company News On-Call:
http://www.prnewswire.com/comp/107555.html
CONTACT:
Paul S. Weiner, Chief Financial Officer of
Palomar Medical Technologies Inc, +1-781-993-2411,
ir@palomarmedical.com
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