CTS(R) Ultima(TM) OPCAB(TM) System Featuring the New QuickLock Stabilizing
Mount Introduced
CUPERTINO, Calif., Oct. 14 /PRNewswire/ -- CardioThoracic Systems, Inc.
(CTS) (Nasdaq: CTSI), a leading developer of minimally invasive cardiac
surgery devices, today reported financial results for the quarter and nine
months ended October 1, 1999.
For the third quarter of 1999, CTS reported net sales of $8.1 million, an
84% increase over 1998 third quarter net sales of $4.4 million. Also for the
third quarter of 1999, CTS reported a net loss of $1.8 million, or $0.13 per
share on 14.5 million weighted average shares outstanding, compared to a net
loss of $4.9 million, or a net loss per share of $0.35 on 14.0 million
weighted average shares outstanding, for the third quarter of 1998.
For the first nine months of 1999, CTS reported net sales of
$21.8 million, a 96% increase over net sales of $11.1 million reported for the
first nine months of 1998. Net loss for the nine month period was
$7.8 million, or $0.54 per share on 14.4 million weighted average shares
outstanding, versus a net loss of $16.5 million, or $1.19 per share on
13.9 million weighted average shares outstanding, in the prior year period.
As of October 1, 1999, CTS had cash, cash equivalents and available-for-
sale securities of approximately $27.8 million.
In September, CTS introduced the CTS(R) Ultima(TM) OPCAB(TM)System
featuring the new QuickLock Stabilizing Mount. The QuickLock mounting
mechanism features a new, improved design that is intended to enhance the
surgeon's ability to quickly and easily approach more difficult vessels. CTS
continues to utilize its extensive experience of over 44,000 beating heart
procedures to set the standard in ease of use, flexibility and clinical
outcomes.
"A key factor in achieving double digit revenue growth for the third
quarter was the increased demand for the CTS Ultima OPCAB System as our focus
on continued education of surgeons regarding the advantages of off-pump bypass
surgery pays off," said Richard Ferrari, CTS president and CEO. "We believe
that the improved features of the QuickLock Stabilizing Mount will further
drive the adoption of the Ultima OPCAB System by providing surgeons with
consistent and reproducible performance when conducting off-pump procedures.
We look forward to working with Guidant Corporation to develop new products
and enhance existing products to augment the momentum we are experiencing as
minimally invasive off-pump bypass surgery becomes even more widespread."
Also during the quarter, CTS announced it had received U.S. Food and Drug
Administration premarket clearance for the CTS(R) Voyager(TM) Aortic
IntraClusion(TM) Device for use in stopped heart procedures, including mitral
valve replacement and repair and coronary artery bypass graft surgery. This
represents the company's second product for stopped heart procedures; each
year, over 700,000 such procedures are performed worldwide. Coupled with the
10 new products CTS launched earlier this year, the CTS Voyager Aortic
IntraClusion Device enables the company to sell at least one product that can
be used in virtually every adult cardiac surgery case. Shipments of the new
device to the first U.S. clinical sites began in August 1999.
On August 30, 1999 CTS and Guidant Corporation (Guidant) announced the
companies had entered into a merger agreement for Guidant to acquire CTS in a
stock-for-stock merger. In the merger, CTS stockholders will receive Guidant
common stock valued at $19.50 per CTS share. The price is subject to possible
adjustment pursuant to a collar agreement. The transaction will be a tax-free
exchange valued at approximately $313 million and is intended to be accounted
for as a pooling-of-interests. CTS has scheduled a special meeting of its
stockholders to be held on November 15, 1999 to consider and vote on the
merger agreement. Only holders of record of CTS stock at the close of
business on October 11, 1999 will be entitled to notice of, and to vote at,
the special meeting. Consummation of the merger is subject to certain
conditions, including approval by CTS shareholders and Hart-Scott-Rodino
anti-trust clearance. A proxy statement/prospectus will be mailed shortly to
stockholders of record on the record date. Solicitation of proxies for the
special meeting will be made only pursuant to such proxy statement/prospectus,
and no proxies are or should be deemed to be solicited hereby.
CardioThoracic Systems, Inc., located in Cupertino, Calif., is a leading
developer of proprietary technologies for use in minimally invasive cardiac
surgery. CTS introduced its first generation system for minimally invasive
beating heart bypass surgery in January 1997. Since that time, CTS has
shipped over 44,000 beating heart bypass systems.
The statements in this news release, including statements relating to the
company's revenue growth, the company's product and service development
efforts and the merger with Guidant Corporation, contain forward-looking
information. Actual results may differ significantly from the results
discussed in the forward-looking statements as a result of risks and
uncertainties associated with the success of the company's development
efforts, the company's financial results, the acceptance of the company's
products and systems, the capabilities and benefits of the CTS instrumentation
and methods, the size of the market for the Company's products, the coverage
and benefits of the company's patents and the completion of the merger with
Guidant Corporation as well as other factors, including factors set forth in
the company's annual report on Form 10-K filed with the SEC on March 30, 1999
and the company's most recent quarterly report on Form 10-Q filed with the SEC
on August 12, 1999. Copies of the Annual Report on Form 10-K and the most
recent quarterly report on form 10-Q are available by calling the company's
investor relations department at 408-342-1700.
To learn more about CardioThoracic Systems, Inc., visit the company's
website at http://www.cardioth.com .
For more information on CardioThoracic Systems, Inc. via fax at no cost,
dial 800-PRO-INFO or 908-544-2850 outside the U.S. Ticker symbol: CTSI
CARDIOTHORACIC SYSTEMS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
(in thousands, except share data)
Three Months Ended Nine Months Ended
October 1, October 2, October 1, October 2,
1999 1998 1999 1998
Net sales $8,120 $4,365 $21,782 $11,144
Cost of sales 2,639 1,897 7,546 5,199
Gross profit 5,481 2,468 14,236 5,945
Operating expenses:
Research and
development 2,585 2,712 7,731 8,064
Sales, marketing,
general and
administrative 5,048 5,249 15,487 16,246
Total operating
expenses 7,633 7,961 23,218 24,310
Loss from operations (2,152) (5,493) (8,982) (18,365)
Interest income, net 319 585 1,138 1,877
Net loss $(1,833) $(4,908) $(7,844) $(16,488)
Net loss per common
share and per
common share -
assuming dilution $(0.13) $(0.35) $(0.54) $(1.19)
Shares used in
computing net loss
per common share and
per common share -
assuming dilution 14,501 14,018 14,408 13,892
CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands)
October 1, 1999 January 1, 1999
(unaudited)
Cash, cash equivalents and
available-for-sale securities $27,776 $40,253
Total current assets 37,177 34,142
Property and equipment, net 2,897 3,374
Total assets 42,742 49,766
Total current liabilities 7,657 8,392
Total stockholders' equity $34,078 $39,963
SOURCE CardioThoracic Systems, Inc.
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Related links:
http://www.cardioth.com
CONTACT:
Richard M. Ferrari, CEO, or Steve Van Dick,
CFO, both of CardioThoracic Systems, Inc., 408-342-1700, general
information, Traci McCarty, analysts, Janet Nelson, or media,
Scott Marx, all of The Financial Relations Board, 415-986-1591,
for CardioThoracic Systems
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