2003 First Quarter Financials Amended to Reflect the Allocation of Purchase
Price for the Bionx Business Acquired in That Period
UTICA, N.Y., Aug. 14 /PRNewswire-FirstCall/ -- CONMED Corporation
(Nasdaq: CNMD) announced today that it has amended its first quarter 2003
results to reflect the allocation of the purchase price for the March 2003
acquisition of Bionx Implants, Inc. The amended results include a non-cash
charge of $7.9 million to write off in-process research and development
acquired from Bionx. The charge is required to account for the value assigned
to in-process research and development in the purchase transaction. An
independent appraisal was recently completed to assist management in assigning
values to the in-process research and development, as well as other tangible
and intangible assets.
As previously disclosed, CONMED planned on recording the in-process
research and development non-cash acquisition charge upon completion of the
independent appraisal in the third quarter of 2003; however, the Company now
believes, after careful review and in accordance with the AICPA Practice Aid
"Assets Acquired In A Business Combination Used In R & D Activities," that it
should record its best estimate of the allocation of the purchase price it
paid for the Bionx business in the quarter in which the acquisition was
consummated, rather than initially recording intangible assets in goodwill
until the allocation could be finalized. Accordingly, the Company has
restated its financial statements for its first quarter and first six months
of 2003 to reflect that allocation. As a result, those statements reflect the
estimated fair value for the acquired in-process research and development of
$7.9 million, and its write-off to expense, and also reflect the allocation of
the Bionx purchase price to the rest of the assets acquired and liabilities
assumed based on their estimated fair values and the appropriate amortization
of those allocated amounts.
Intangible assets identified in the Bionx purchase include core/developed
technology, in-process technology, customer relationships and goodwill. In
accordance with FAS 142, "Accounting For Goodwill and Other Intangible
Assets," goodwill will not be amortized, while core/developed technology and
customer relationships will be amortized to expense over their estimated
useful lives. The in-process technology (in-process research and development)
has been charged to expense in accordance with FAS 2 "Accounting For Research
and Development Costs" and FASB Interpretation No. 4.
For the three months ended March 31, 2003, previously reported net income
of $14.6 million, or $0.50 per diluted share, has been adjusted to $6.7
million, or $0.23 per diluted share, and previously reported shareholders'
equity of $405.0 million has been adjusted to $397.1 million.
For the six months ended June, 2003, previously reported net income of
$17.3 million, or $0.59 per diluted share, has been adjusted to $9.4 million,
or $0.32 per diluted share, and previously reported shareholders' equity of
$409.8 million has been adjusted to $401.9 million.
CONMED Profile
CONMED is a medical technology company specializing in instruments,
implants, and video equipment for arthroscopic sports medicine, and powered
surgical instruments, such as drills and saws, for orthopedic, ENT,
neuro-surgery, and other surgical specialties. The Company is also a leading
developer, manufacturer and supplier of RF electrosurgery systems used
routinely to cut and cauterize tissue in nearly all types of surgical
procedures worldwide, endoscopy products such as trocars, clip appliers,
scissors, and surgical staplers. The Company offers integrated operating room
design and intensive care unit service managers. The Company also
manufactures and sells a full line of ECG electrodes for heart monitoring and
other patient care products. Headquartered in Utica, New York, the Company's
2,600 employees distribute its products worldwide from eleven manufacturing
locations.
Forward Looking Information
This press release contains forward-looking statements based on certain
assumptions and contingencies that involve risks and uncertainties. The
forward-looking statements are made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995 and relate to the
Company's performance on a going-forward basis. The forward-looking
statements in this press release involve risks and uncertainties which could
cause actual results, performance or trends, to differ materially from those
expressed in the forward-looking statements herein or in previous disclosures.
The Company believes that all forward-looking statements made by it have a
reasonable basis, but there can be no assurance that management's
expectations, beliefs or projections as expressed in the forward-looking
statements will actually occur or prove to be correct. In addition to general
industry and economic conditions, factors that could cause actual results to
differ materially from those discussed in the forward-looking statements in
this press release include, but are not limited to: (i) the failure of any one
or more of the assumptions stated above, to prove to be correct; (ii) the
risks relating to forward-looking statements discussed in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2002; (iii)
cyclical purchasing patterns from customers, end-users and dealers; (iv)
timely release of new products, and acceptance of such new products by the
market; (v) the introduction of new products by competitors and other
competitive responses; (vi) the possibility that any new acquisition or other
transaction may require the Company to reconsider its financial assumptions
and goals/targets; and/or (vii) the Company's ability to devise and execute
strategies to respond to market conditions.
SOURCE CONMED Corporation
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http://www.conmed.com
Company News On-Call:
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CONTACT:
Robert Shallish, Chief Financial Officer of
CONMED Corporation, +1-315-624-3206; or Investors - Lauren Levine
or Tiernan Cavanna, or Media - Sean Leous, all of Financial
Dynamics, +1-212-850-5600, for CONMED Corporation
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