PhotoMedex Reports First Quarter 2013 Financial Results
PhotoMedex Reports First Quarter 2013 Financial Results
Revenues increased 14% over the same period in 2012, diluted EPS increased 31% to $0.34
MONTGOMERYVILLE, Pa.--(BUSINESS WIRE)-- PhotoMedex, Inc.
- Revenues of $57.2 million, an increase of 14% compared with the prior-year first quarter and an increase of 4% sequentially
- Consumer revenues of $49.0 million, an increase of 16% compared with the prior-year first quarter and an increase of 6% sequentially
- Direct-to-consumer channel revenues of $31.7 million, an increase of 1% compared with the prior-year first quarter and an increase of 6% sequentially
- Global retail and home shopping channel revenues of $12.0 million, an increase of 101% compared with the prior-year first quarter and a decrease of 3% sequentially
- Distributor consumer channel revenues of $5.3 million, an increase of 13% compared with the prior-year first quarter and an increase of 41% sequentially
- XTRAC® adjusted treatment revenues of $3.2 million, an increase of 73% compared with the prior-year first quarter and an increase of 22% sequentially
- XTRAC® recurring revenue U.S. installed base of 401 at quarter end, an increase of 51 placements during the quarter, including 27 on the Comeback program of previously sold systems
- NEOVA® skin care revenues of $2.2 million, an increase of 3% compared with the prior-year first quarter and an increase of 14% sequentially
- Gross profit of $45.4 million, an increase of 16% compared with the first quarter of 2012
- Gross margin of 79.3% compared with 77.7% in the prior-year first quarter
- Pre-tax income of $9.7 million, an increase of 91% compared with the prior-year first quarter and an increase of 45% sequentially
- Earnings per diluted share of $0.34, an increase of 31%, compared with the prior-year first quarter and an increase of 21% sequentially
- Non-GAAP adjusted income of $12.5 million or $0.59 per diluted share, representing increases of 49% and 34%, respectively, compared with the prior-year first quarter and increases of 31% and 31%, respectively, sequentially
Reported Financial Results
Revenues for the first quarter of 2013 were $57.2 million, an increase of 14% compared with revenues for the first quarter of 2012 of $50.3 million.
Net income for the first quarter of 2013 was $7.2 million, or $0.34 per diluted per share, which included $1.3 million in stock-based compensation expense and $1.4 million in depreciation and amortization expenses. This compares with net income for the first quarter of 2012 of $4.9 million, or $0.26 per diluted share, which included $1.8 million in stock-based compensation expense and $1.3 million in depreciation and amortization expenses.
PhotoMedex repurchased no shares of its common stock during the first quarter of 2013.
As of March 31, 2013 the Company had cash and cash equivalents of $63.5 million or $3.00 per diluted share, compared with $62.3 million as of December 31, 2012. Current assets included $24.3 million in accounts receivable, compared with $19.1 million as of December 31, 2012. The increase in accounts receivables was largely related to the impact of the timing of shipments related to a television home shopping special event in the first quarter, which were collected in the second quarter.
Management expects revenues for the second quarter of 2013 to exceed $59 million.
Dr. Dolev Rafaeli, PhotoMedex CEO, commented, "The rapid growth we have achieved the past few years continued during the first quarter and, importantly, featured an improvement in gross margin led by a 16% increase in consumer revenues, particularly from our no!no!™ products. No!no! is now available in most every Bed Bath and Beyond store across the U.S. and we are pleased with the initial sales ramp. We have also had strong responses to our Spanish-language advertisements in the U.S. and our marketing of no!no! Men. In addition we achieved substantial sales increases in Neova® skin care products from upselling no!no! customers at our call centers.
"Geographic expansion holds particular promise for PhotoMedex as we prepare to launch no!no! in Brazil and further develop the German and Korean markets. We are very excited about the sales potential in these geographies going into the second half of the year."
Dr. Rafaeli added, "XTRAC adjusted treatment revenues were up 73% compared with the first quarter of 2012 as our direct-to-patient advertising is having a clear impact. We've initiated television and radio advertising in six new areas of the country and we plan additional rollouts of advertising in new markets throughout the year."
A reconciliation of non-GAAP financial measures to GAAP financial measures, and a presentation of the most directly comparable GAAP financial measures are included below.
To supplement PhotoMedex's consolidated financial statements presented in accordance with GAAP, PhotoMedex provides certain non-GAAP measures of financial performance. These non-GAAP measures include non-GAAP adjusted income and non-GAAP adjusted income per share.
PhotoMedex's reference to these non-GAAP measures should be considered in addition to results prepared under current accounting standards, but are not a substitute for, nor superior to, GAAP results. These non-GAAP measures are provided to enhance investors' overall understanding of PhotoMedex's current financial performance and to provide further information for comparative purposes.
Specifically, the Company believes the non-GAAP measures provide useful information to both management and investors by isolating certain expenses, gains and losses that may not be indicative of the Company's core operating results and business outlook. In addition, PhotoMedex believes non-GAAP measures enhance the comparability of results against prior periods. Reconciliation to the most directly comparable GAAP measure of all non-GAAP measures included in this press release is as follows:
|Three Months Ended Mar 31,|
|(ooo's) except per share amounts||2013||2012|
|Net income as reported||$||7,212||$||4,857|
|Depreciation and amortization expense||1,443||1,332|
|Interest expense, net||5||189|
|Income tax expense||2,511||240|
|Stock-based compensation expense||1,290||1,753|
|Non-GAAP adjusted income||$||12,461||$||8,371|
|Fully diluted shares outstanding at March 31||21,148||18,876|
|Non-GAAP adjusted income per share||$||0.59||$||0.44|
PhotoMedex will hold a conference call to discuss the Company's first quarter 2013 results and answer questions today, May 8, 2013 beginning at 11:00 a.m. Eastern time.
To participate in the conference call, dial toll free 888-686-9681 or International/toll 913-312-1467 (and confirmation code # 7662001) approximately five to 10 minutes prior to the scheduled start time. For the convenience of our Israeli participants, a local/toll free number (1-80-925-8350) has been set up (the confirmation code remains the same # 7662001). If you are unable to participate, a digital replay of the call will be available from Wednesday, May 8, 2013 from 2:00 p.m. ET to Wednesday, May 22, 2013 at 2:00 p.m. ET, by dialing toll free 888-203-1112 or International/toll 719-457-0820 (Israeli participants may dial 1-80-924-6038) and using confirmation code # 7662001.
The live broadcast of PhotoMedex, Inc.'s quarterly conference call will be available online by going to www.photomedex.com and clicking on the link to Investor Relations, and at www.streetevents.com. The online replay will be available shortly after the conclusion of the call at those sites.
PhotoMedex is a global skin health company providing integrated disease management and aesthetic solutions to dermatologists, professional aestheticians and consumers. The company provides proprietary products and services that address skin diseases and conditions including psoriasis, vitiligo, acne, actinic keratosis (a precursor to certain types of skin cancer) and photo damage. Its experience in the physician market provides the platform to expand its skin health solutions to spa markets, as well as traditional retail, online and infomercial outlets for home-use products. As a result of its December 2011 merger with Radiancy Inc., PhotoMedex has added a range of home-use devices under the no!no!™ brand, for various indications including hair removal, acne treatment and skin rejuvenation. The company also offers a professional product line for acne clearance, skin tightening, psoriasis care and hair removal sold to physician clinics and spas.
SAFE HARBOR STATEMENT
Some portions of the conference call, particularly those describing PhotoMedex' strategies, operating expense reductions and business plans will contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks, uncertainties and other factors.All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including any statements of the plans, strategies and objectives of management for future operations; any statements regarding product development, product extensions, product integration or product marketing; any statements regarding continued compliance with government regulations, changing legislation or regulatory environments; any statements of expectation or belief and any statements of assumptions underlying any of the foregoing. In addition, there are risks and uncertainties related to successfully integrating the products and employees of the Company and Radiancy, as well as the ability to ensure continued regulatory compliance, performance and/or market growth.These risks, uncertainties and other factors, and the general risks associated with the businesses of the Company described in the reports and other documents filed with the SEC, could cause actual results to differ materially from those referred to, implied or expressed in the forward-looking statements.The Company cautions readers not to rely on these forward-looking statements.All forward-looking statements are based on information currently available to the Company and are qualified in their entirety by this cautionary statement.The Company anticipates that subsequent events and developments will cause its views to change.The information contained in this conference call speaks as of the date hereof and the Company has or undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.
|Three Months Ended March 31,|
|(ooo's) except per share amounts||2013||2012|
|Cost of revenues||11,866||11,234|
|Selling and marketing||29,326||25,835|
|General and administrative||5,659||7,119|
|Research and development and engineering||773||758|
|Interest and other financing income (expense), net||131||(230||)|
|Income before taxes expense||9,723||5,097|
|Income tax (expense) benefit||(2,511||)||(240||)|
|Net income 1||$||7,212||$||4,857|
|Net income per share:|
|Shares used in computing net income per share:|
|1 Includes: depreciation and amortization||1,443||1,332|
|Share-based compensation expense||1,290||1,753|
|CONSOLIDATED STATEMENTS OF REVENUES|
|For the three months ended:|
|March 31, 2013||December 31, 2012||March 31, 2012|
|Retailer and home shopping channels||12,047||12,362||5,992|
|Less: XTRAC incremental deferred revenue||(590||)||29||(145||)|
|CONDENSED CONSOLIDATED BALANCE SHEETS|
|March 31, 2013||December 31, 2012|
|Cash, cash equivalents, and short-term investments||$||63,509||$||62,348|
|Accounts receivable, net||24,281||19,064|
|Other current assets||28,155||32,294|
|Property and equipment, net||7,744||6,759|
|Other non-current assets||66,358||68,958|
|Liabilities and Stockholders' Equity|
|Accounts payable and accrued liabilities||$||26,432||$||34,618|
|Other current liabilities||6,648||5,259|
|Bank and lease notes payable||593||619|
|Total Liabilities and Stockholders' Equity||$||211,530||$||211,890|
For the Three Months
|CASH FLOWS FROM OPERATING ACTIVITIES:|
|Adjustments to reconcile net income to net cash provided by operating activities--|
|Depreciation and amortization||1,443||1,332|
|Provision for doubtful accounts||1,046||714|
|Deferred income taxes||523||2,027|
|Changes in assets and liabilities:|
|(Increase) decrease in--|
|Net cash provided by operating activities||3,064||8,148|
|CASH FLOWS FROM INVESTING ACTIVITIES:|
|Lasers placed in service||(1,220||)||(366||)|
|Purchases of PP&E, net||(211||)||(96||)|
|Net cash used in investing activities||(1,489||)||(532||)|
|CASH FLOWS FROM FINANCING ACTIVITIES:|
|Proceeds from exercise of options/issuance of securities||13||125|
|Repayments of debt||(213||)||(737||)|
|Net cash used in financing activities||(200||)||(612||)|
|Effect of exchange rate changes on cash||(214Read Full Story|