Net Loss Reduced 61% Compared to Year-Ago Period
Conference Call Scheduled for April 27, 2007 at 8 a.m. CT; Simultaneous
Webcast at http://www.ev3.net
PLYMOUTH, Minn., April 27 /PRNewswire-FirstCall/ -- ev3 Inc. (Nasdaq:
EVVV), a global endovascular device company, today reported financial
results for its fiscal first quarter of 2007.
(Logo: http://www.newscom.com/cgi-bin/prnh/20050615/CGEV3LOGO )
As previously reported, ev3's net sales in the first quarter of 2007
increased 46% to $61.5 million versus net sales of $42.2 million in the
first quarter of 2006. First quarter sales growth was broad-based and
reflected a strong contribution from each of ev3's Cardio Peripheral and
Neurovascular business segments, as well as a strong contribution from both
domestic and international markets.
Jim Corbett, president and CEO of ev3 Inc., commented, "Our first
quarter sales growth continued at a rate consistent with us achieving our
longer term business and financial objectives. We are very pleased with our
balanced growth and enthusiastic about the potential for several of our new
products including the EverFlex Stent, the Onyx Liquid Embolic System, and
the recently approved Protege RX Stent combined with the SpideRX Embolic
Protection Device for carotid stenting."
ev3's net loss for the first quarter of 2007 declined 61% to $9.5
million compared to $24.5 million in the first quarter of 2006. ev3's net
loss per common share was $0.17 for the first quarter of 2007 compared to
$0.44 per common share in the first quarter of 2006. Total weighted average
common shares outstanding used in the per share calculations were 57.5
million and 55.9 million for the first quarter of 2007 and 2006,
respectively.
ev3's earnings before interest, taxes, depreciation and amortization
(EBITDA), excluding charges for non-cash stock-based compensation, was a
negative $1.2 million in the first quarter of 2007, compared to a negative
$17.7 million in the first quarter of 2006. ev3 uses the non-GAAP financial
measures, EBITDA and EBITDA, excluding charges for non-cash stock-based
compensation, as supplemental measures of performance and believes that
these measures facilitate operating performance comparisons from period to
period and company to company.
EBITDA and EBITDA, excluding charges for non-cash stock-based
compensation, for the first quarter ended April 1, 2007 and April 2, 2006
are reconciled to ev3's net loss for the respective periods immediately
following the detail of net sales by geography later in this press release.
This information is also made available on the company's website at
http://www.ev3.net.
Corbett continued, "2007 is a year in which we will be increasing our
investment in clinical trials to further validate the performance
advantages of our products and provide physicians and third party payers
with increased clinical data. However, we remain committed to a significant
year over year improvement in our 2007 EBITDA performance."
Sales Review
In the first quarter of 2007, ev3's Neurovascular segment net sales
increased 48% to $25.0 million versus $16.9 million in the first quarter of
2006. Within the Neurovascular business segment, sales of embolic products
increased 75% to $12.9 million from $7.4 million, and sales of Neuro access
and delivery products were up 27% to $12.1 million from $9.5 million. The
primary growth drivers for the Neurovascular segment were the continued
market penetration of both the Onyx Liquid Embolic System for the treatment
of brain arterio-venous malformations (AVMs) and the Nexus family of
embolic coils for the treatment of brain aneurysms.
Cardio Peripheral segment net sales in the first quarter of 2007
increased 44% to $36.5 million versus $25.3 million in the first quarter of
2006. Within the Cardio Peripheral business segment, stent sales increased
52% to $19.8 million from $13.1 million. Sales of thrombectomy and embolic
protection products increased 54% to $6.2 million from $4.0 million, while
sales of procedural support and other Cardio Peripheral products increased
27% to $10.5 million from $8.2 million. The largest contributors to the
growth in the Cardio Peripheral segment were the EverFlex stent and the
recently approved Protege RX stent combined with the SpideRX Embolic
Protection Device for carotid stenting.
On a geographic basis, ev3's first quarter U.S. net sales increased 42%
to $35.1 million, while first quarter international net sales increased 51%
to $26.4 million, over the prior-year quarter. Changes in foreign currency
exchange rates had a positive impact of approximately $1.4 million on first
quarter 2007 net sales compared to the first quarter of the prior year.
Outlook
ev3 continues to expect 2007 annual net sales to be in the range of
approximately $262 to $278 million. ev3 expects second quarter of 2007 net
sales to be in the range of $63 to $67 million. Further, ev3 continues to
expect its EBITDA, excluding non-cash stock-based compensation, to be
positive in 2007.
Earnings Call Information
ev3 will host a conference call today, April 27, 2007, beginning at 8
a.m. CT to review its results of operations for the first quarter of 2007
and other recent events and to discuss its 2007 business outlook.
Discussions during the conference call may include forward-looking
statements regarding such topics as, but not limited to, the company's net
sales, cost of goods sold, operating expenses, distribution arrangements,
clinical studies, regulatory status, financial position and comments the
company may make about its future in response to questions from
participants on the conference call. Any interested party may listen to the
conference call through a live audio Webcast at http://www.ev3.net. For
those unable to listen to the Webcast, a playback of the Webcast will be
available at http://www.ev3.net for approximately 90 days. Those without
Internet access may join the call from within the United States by dialing
(866) 277-1181; outside the United States dial (617) 597-5358 passcode
93392122. A playback of the conference call will be available from 11 a.m.
CT, April 27, 2007 until noon CT on May 4, 2007 by dialing (888) 286-8010
(United States) or (617) 801-6888 (International), passcode 18302612.
Statements contained in this press release that are not historical
information are forward-looking statements as defined within the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
are subject to risks and uncertainties that could cause actual results to
differ materially from those projected or implied. Such potential risks and
uncertainties relate, but are not limited to, in no particular order:
product demand and market acceptance; the impact of competitive products
and pricing; delays in regulatory approvals and the introduction of new
products; and success of clinical testing. More detailed information on
these and additional factors which could affect ev3 Inc.'s operating and
financial results is described in the company's filings with the Securities
and Exchange Commission, including its most recent annual report on Form
10-K. ev3 Inc. urges all interested parties to read this report to gain a
better understanding of the many business and other risks that the company
faces. Additionally, ev3 Inc. undertakes no obligation to publicly release
the results of any revisions to these forward-looking statements, which may
be made to reflect events or circumstances occurring after the date hereof
or to reflect the occurrence of unanticipated events.
ev3 and the ev3 logo are trademarks of ev3 Inc., registered in the U.S.
and other countries.
All trademarks and tradenames referred to in this press release are the
property of their respective owners.
ev3 Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share amounts)
(unaudited)
For the Three Months Ended
April 1, April 2,
2007 2006
Net sales $61,499 $42,237
Operating expenses
Cost of goods sold (a) 20,457 16,488
Sales, general and administrative
(a) 39,137 37,861
Research and development (a) 7,433 6,774
Amortization of intangible assets 4,100 4,243
Loss on sale or disposal of assets,
net 16 170
Acquired in-process research and
development --- 1,786
Total operating expenses 71,143 67,322
Loss from operations (9,644) (25,085)
Other (income) expense:
Interest (income) expense, net (109) (699)
Other (income) expense, net (317) (54)
Loss before income taxes (9,218) (24,332)
Income tax expense 276 169
Net loss $(9,494) $(24,501)
Earnings per share:
Net loss per common share (basic
and diluted) $(0.17) $(0.44)
Weighted average common shares
outstanding 57,514,255 55,944,925
(a)Includes stock-based compensation
charges of:
Cost of goods sold $158 $214
Sales, general and administrative 1,859 1,366
Research and development 182 214
$2,199 $1,794
ev3 Inc.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share amounts)
April 1, December 31,
2007 2006
(unaudited)
Assets
Current assets
Cash and cash equivalents $18,732 $24,053
Short-term investments 7,900 14,700
Accounts receivable, less allowance
of $4,247 and $3,924, respectively 49,413 45,137
Inventories 46,199 42,124
Prepaid expenses and other assets 5,565 7,162
Other receivables 3,652 2,669
Total current assets 131,461 135,845
Restricted cash 1,307 2,022
Property and equipment, net 24,140 24,072
Goodwill 149,061 149,061
Other intangible assets, net 45,837 40,014
Other assets 730 1,812
Total assets $352,536 $352,826
Liabilities and stockholders' equity
Current liabilities
Accounts payable $14,465 $13,140
Accrued compensation and benefits 12,358 16,382
Accrued liabilities 12,954 10,102
Current portion of long-term debt 2,976 2,143
Total current liabilities 42,753 41,767
Long-term debt 8,988 5,357
Other long-term liabilities 1,113 468
Total liabilities 52,854 47,592
Stockholders' equity
Common stock: $0.01 par value;
100,000,000 shares authorized;
issued and outstanding: 58,243,788 and
57,594,742, respectively 582 576
Additional paid in capital 923,945 919,221
Accumulated deficit (624,788) (614,578)
Accumulated other comprehensive
income (57) 15
Total stockholders' equity 299,682 305,234
Total liabilities and stockholders'
equity $352,536 $352,826
ev3 Inc.
SELECTED NET SALES INFORMATION
(Dollars in thousands, except per share amounts)
(unaudited)
NET SALES BY SEGMENT For the Three Months Ended
April 1, April 2,
2007 2006 % change
Cardio Peripheral
Stents $19,806 $13,046 52%
Thrombectomy and embolic
protection 6,218 4,037 54%
Procedural support and other 10,467 8,249 27%
Total cardio peripheral 36,491 25,332 44%
Neurovascular
Embolic products 12,926 7,383 75%
Neuro access and delivery
products and other 12,082 9,522 27%
Total neurovascular 25,008 16,905 48%
Total company $61,499 $42,237 46%
NET SALES BY GEOGRAPHY For the Three Months Ended
April 1, April 2,
2007 2006 % change
United States $35,140 $24,774 42%
International 26,359 17,463 51%
Total net sales $61,499 $42,237 46%
ev3 Inc.
NON-GAAP FINANCIAL MEASURES
(Dollars in thousands)
(unaudited)
For the Three Months Ended
April 1, April 2,
2007 2006
Reconciliation of net loss to EBITDA
Net loss, as reported (GAAP
basis) $(9,494) $(24,501)
Interest (income) expense,
net (109) (699)
Income tax expense 276 169
Depreciation and amortization 5,904 5,517
EBITDA $(3,423) $(19,514)
Stock-based compensation 2,199 1,794
EBITDA, adjusted for stock-based
compensation $(1,224) $(17,720)
ev3 uses non-GAAP financial measures, as outlined above, as
supplemental measures of performance and believes these measures facilitate
operating performance comparisons from period to period and company to
company by factoring out potential differences caused by variations in
capital structure, tax positions, depreciation, non-cash charges and
certain large and unpredictable charges. ev3 also believes that the
presentation of these measures provides useful information to investors in
evaluating the company's operations, period over period. Non-GAAP measures
have limitations as analytical tools, and should not be considered in
isolation, or as a substitute for analysis of the company's results as
reported under Generally Accepted Accounting Principles (GAAP). This
information is also made available on the company's website at
http://www.ev3.net.
SOURCE ev3 Inc.
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Related links:
http://www.ev3.net
Photo Notes:
NewsCom: http://www.newscom.com/cgi-bin/prnh/20050615/CGEV3LOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com
CONTACT:
Patrick Spangler, CFO of ev3 Inc.,
+1-763-398-7000, pspangler@ev3.net; or Media Relations, Laura
Nobles of Nobles Communications, +1-310-795-0497,
laura@noblescommunications.com, for ev3 Inc.; or Investor
Relations, Marian Briggs, +1-612-455-1742, mbriggs@psbpr.com, or
Nancy A. Johnson, +1-612-455-1745, njohnson@psbpr.com, both of
Padilla Speer Beardsley for ev3 Inc.
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