BURLINGTON, Mass., May 1 /PRNewswire-FirstCall/ -- Palomar Medical
Technologies, Inc. (Nasdaq: PMTI), a leading researcher and developer of
light-based systems for cosmetic treatments, today announced financial
results for the first quarter ended March 31, 2008. Revenues for the
quarter ended March 31, 2008 were $23.0 million, of which $17.7 million
were product revenues. Royalty revenues were $3.2 million, of which
$682,000 related to the recognition of the remaining portion of back-owed
royalties associated with the Alma Lasers, Ltd. settlement agreement.
Funded development revenues were $597,000. Other revenues were $1.5 million
related to a payment of $1.25 million under the non-exclusive license
agreement with The Procter & Gamble Company for home-use, light-based hair
removal devices for women and the recognition of the remaining portion of
trade dress infringement fees associated with the Alma Lasers, Ltd.
settlement agreement of $248,000. First quarter gross margin from product
revenues was 63%. Product gross margin was negatively affected by lower
product revenues which resulted in lower overhead absorption. Loss before
taxes for the first quarter ended March 31, 2008 was $1.8 million, which
included approximately $2.4 million in legal expenses related to the
Candela lawsuits and certain other adjustments as shown below.
The Company reported net loss of $1.0 million, or $0.05 per share for
the first quarter of this year and net income of $5.9 million, or $0.30 per
diluted share for the first quarter of 2007. Non-GAAP net income for the
quarter ended March 31, 2008, which includes adjustments for back-owed
royalty revenues, trade dress infringement fees, cost of back-owed royalty
revenues, investment banking fees related to an international distributor
agreement, FAS 123R compensation charge, interest on back-owed royalties,
and non-cash taxes, resulted in $1.6 million, or $0.09 per diluted share.
Please refer to the financial statements included in this news release for
a reconciliation of GAAP results to non-GAAP results for the three months
ended March 31, 2008 and 2007.
The Company's balance sheet continues to be strong and includes $128.0
million in cash and marketable securities. The Company reclassified
approximately $21.4 million of its marketable securities to non-current
assets due to the recent illiquidity in the auction-rate securities market.
The Company has the intent and ability to hold these investments to
maturity.
Chief Executive Officer Joseph P. Caruso commented, "We are
disappointed with the revenues generated this quarter in North America. A
slowdown in the economy seems to be a factor in delaying the buying
decisions of our customer base, especially those new to the market. We
believe, however, that the use of light-based devices for aesthetic
treatments is an excellent opportunity for growth and we are positioned
well to capitalize on this opportunity in the future with leading edge
professional products, consumer product offerings on the horizon, and a
strong intellectual property portfolio. During the quarter, we also
launched our laser-assisted lipolysis Aspire Body Sculpting platform. This
novel technology addresses the fastest growing segment of our market, fat
reduction, and rounds out our product offering to both existing and new
customers. We are targeting the first shipments of this new system during
the third quarter."
Use of Non-GAAP Financial Measures
To supplement Palomar's consolidated financial statements presented in
accordance with GAAP, this news release uses the following measures defined
as non-GAAP financial measures by the SEC: non-GAAP income before taxes,
non-GAAP provision for income taxes, non-GAAP net income, and non-GAAP
diluted earnings per share. The presentation of this financial information
is not intended to be considered in isolation or as a substitute for the
financial information prepared and presented in accordance with GAAP. In
addition, the non-GAAP financial measures included in this news release may
be different from, and therefore not comparable to, similar measures used
by other companies. For more information on these non-GAAP financial
measures, please see the non-GAAP data included below. This data has more
details of the GAAP financial measures that are most directly comparable to
non-GAAP financial measures and the related reconciliations between these
financial measures. Palomar's management believes that these non-GAAP
financial measures provide meaningful supplemental information regarding
our performance by excluding certain items that may not be indicative of
our core business operating results. Palomar believes that both management
and investors benefit from referring to these non-GAAP financial measures
in assessing Palomar's performance and when planning, forecasting and
analyzing future periods. These non-GAAP financial measures also facilitate
management's internal comparisons to Palomar's historical performance and
our competitors' operating results. Palomar believes that these non-GAAP
measures are useful to investors in allowing for greater transparency with
respect to supplemental information used by management in its financial and
operational decision making.
Conference Call: As previously announced, Palomar will conduct a
conference call and webcast today at 11:30 AM Eastern Time. Management will
discuss financial results and strategic matters. If you would like to
participate, please call (866) 770-7051 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 38414246 and will be available
for fourteen days. A webcast replay will also be available.
About Palomar Medical Technologies Inc: Palomar is a leading researcher
and developer of light-based systems for cosmetic treatments. Palomar
pioneered the optical hair removal field, when, in 1997, 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.
In December 2006, Palomar became the first company to receive a 510(k)
over-the- counter (OTC) clearance from the United States Food and Drug
Administration (FDA) for a new, patented, home-use, light-based hair
removal device. OTC clearance allows the product to be marketed and sold
directly to consumers without a prescription. There are now millions of
light-based cosmetic procedures performed around the world every year in
physician offices, clinics, spas and salons. Palomar is testing many new
and exciting applications to further advance the hair removal market and
other cosmetic applications. Palomar is focused on developing proprietary
light-based technology for introduction to the mass markets. Palomar has
granted The Procter & Gamble Company a non-exclusive License Agreement to
certain patents, technology and FDA documents related to the home-use,
light-based hair removal field for women. In addition, Palomar has an
exclusive development and license agreement with Johnson & Johnson Consumer
Companies to develop and potentially commercialize home-use, light-based
devices for reducing or reshaping body fat including cellulite, reducing
the appearance of skin aging, and reducing or preventing acne.
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 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, future
royalty amounts due from third parties, development and introduction of new
products, and financial and operating projections. These forward-looking
statements are neither promises nor guarantees, but 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 and government contracts, the
impact of competitive products and pricing, governmental regulations with
respect to medical devices, including whether FDA clearance will be
obtained for future products and additional applications, the results of
litigation, difficulties in collecting royalties, potential infringement of
third-party intellectual property rights, factors affecting the Company's
future income and resulting ability to utilize its NOLs, 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, 2007 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.
Contacts: Kayla Castle
Investor Relations Manager
Palomar Medical Technologies, Inc.
781-993-2411
ir@palomarmedical.com
Palomar Financial Summary:
Consolidated Statements of Income (Unaudited)
Three Months Ended
March 31,
2008 2007
Revenues:
Product revenues $17,688,793 $27,398,545
Royalty revenues 3,247,023 2,684,554
Funded product development revenues 596,570 1,435,080
Other revenues 1,497,625 -
Total revenues 23,030,011 31,518,179
Costs and expenses:
Cost of product revenues 6,594,332 8,618,388
Cost of royalty revenues 1,298,810 1,073,822
Research and development 5,383,647 4,303,342
Selling and marketing 6,778,317 6,275,988
General and administrative 6,236,592 3,144,090
Total costs and expenses 26,291,698 23,415,630
(Loss) income from operations (3,261,687) 8,102,549
Interest income 1,423,040 1,366,299
Other income 10,517 -
(Loss) income before income taxes (1,828,130) 9,468,848
(Benefit) provision for income taxes (823,490) 3,598,162
Net (loss) income $(1,004,640) $5,870,686
Net (loss) income per share:
Basic $(0.05) $0.32
Diluted $(0.05) $0.30
Weighted average number of shares outstanding:
Basic 18,313,701 18,129,429
Diluted 18,313,701 19,421,397
Non-GAAP data:
(Loss) income before income taxes $(1,828,130) $9,468,848
Royalty revenues: Back-owed royalty (682,380) -
Other revenues: Trade dress infringement fees (247,625) -
Cost of royalty revenues: Back-owed royalty 272,952 -
General and administrative: Investment banking
fee for international distributor agreement 1,013,899 -
FAS 123R stock-based compensation 3,343,475 (15,375)
Interest income: Interest on back-owed royalty (52,409) -
Non-GAAP income before income taxes 1,819,782 9,453,473
(Benefit) provision for income taxes (823,490) 3,598,162
Provision for income taxes - non-cash 622,396 (3,030,031)
Tax effect related to one-time events - cash 401,270 (923)
Non-GAAP provision for income taxes 200,176 567,208
Non-GAAP net income $1,619,606 $8,886,265
Non-GAAP diluted net income per share $0.09 $0.46
Diluted weighted average number of shares
outstanding 18,658,581 19,421,397
Consolidated Balance Sheets (Unaudited)
March 31, December 31,
2008 2007
Assets
Current assets:
Cash and cash equivalents $106,668,486 $90,460,350
Available-for-sale investments,
at market value - 41,910,000
Accounts receivable, net 11,745,581 16,037,475
Inventories 15,138,480 12,896,154
Deferred tax assets 5,459,352 3,811,873
Other current assets 2,290,657 1,129,300
Total current assets 141,302,556 166,245,152
Marketable securities, at market value 21,363,836 -
Property and equipment, net 1,317,471 1,250,437
Other assets 111,074 111,074
Total assets $164,094,937 $167,606,663
Liabilities and Stockholders' Equity
Liabilities:
Accounts payable $3,775,471 $1,987,579
Accrued liabilities 7,211,723 12,606,422
Deferred revenue 4,835,010 5,789,936
Total current liabilities 15,822,204 20,383,937
Deferred taxes 2,546,017 2,533,220
Total liabilities $18,368,221 $22,917,157
Stockholders' equity:
Preferred stock, $.01 par value-
Authorized - 1,500,000 shares
Issued - none - -
Common stock, $.01 par value-
Authorized - 45,000,000 shares
Issued - 18,453,021 and 18,442,846 shares,
respectively 184,530 184,429
Additional paid-in capital 203,713,062 199,988,081
Accumulated other comprehensive income (333,764) 12,590
Accumulated deficit (53,483,648) (52,479,008)
Treasury stock, at cost - 205,000 and 105,000
shares, respectively (4,353,464) (3,016,586)
Total stockholders' equity $145,726,716 $144,689,506
Total liabilities and stockholders' equity $164,094,937 $167,606,663
SOURCE Palomar Medical Technologies, Inc.
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Related links:
http://www.palomarmedical.com
http://www.prnewswire.com/comp/107555.html /
CONTACT:
Kayla Castle, Investor Relations Manager of
Palomar Medical Technologies, Inc., +1-781-993-2411,
ir@palomarmedical.com
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