MOUNTAIN VIEW, Calif.,
March 17, 2016 /PRNewswire/ --
Omnicell, Inc. (NASDAQ: OMCL), a leading provider of
medication and supply management solutions to healthcare systems,
today issued a press release presenting the pro forma financial
information related to its recent acquisition of Aesynt Holding
Coöperatief U.A. ("Aesynt").
On January 6, 2016, Omnicell filed
a Current Report on Form 8-K (the "Original Form
8-K") reporting that on January 5,
2016 Omnicell closed its acquisition of Aesynt. On
March 17, 2016, Omnicell filed Form
8-K/A that amended the Original Form 8-K to provide the historical
financial statements of Aesynt and the pro forma financial
information required by Items 9.01(a) and 9.01(b) of Form 8-K that
were excluded from the Original Form 8-K in reliance on the
instructions to such items. Except for the filing of the historical
financial statements and pro forma financial information, the
Original Form 8-K is not being amended or updated in any other
manner. Details of this Form 8-K and the Form 8-K/A can be found in
the investor relations section of our website and can be accessed
by clicking here.
In addition to these filings, Omnicell is presenting herein the
Non-GAAP reconciliation of pro forma financial information related
to its recent acquisition of Aesynt as if the acquisition had
occurred on January 1, 2015.
About Omnicell
Since 1992, Omnicell (NASDAQ: OMCL) has been creating innovative
solutions to improve patient care, anywhere it is delivered.
Omnicell is a leading supplier of comprehensive automation and
business analytics software for medication and supply management
across the entire health care continuum—from the acute care
hospital setting, to post-acute skilled nursing and long-term care
facilities, to the patient's home.
Approximately 4,000 customers worldwide use Omnicell automation
and analytics solutions to increase operational efficiency, reduce
medication errors, deliver actionable intelligence and improve
patient safety. The recent acquisition of Aesynt adds distinct
capabilities, particularly in central pharmacy and IV robotics,
creating the broadest medication management product portfolio in
the industry.
The Omnicell SureMed solution provides innovative medication
adherence packaging to help reduce costly hospital readmissions. In
addition, these solutions enable approximately 7,000 institutional
and retail pharmacies worldwide to maintain high accuracy and
quality standards in medication dispensing and administration while
optimizing productivity and controlling costs.
For more information about Omnicell, Inc. please visit
www.omnicell.com.
Forward-Looking Statements
To the extent any statements contained in this release deal with
information that is not historical, these statements are
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. As such, they are subject
to the occurrence of many events outside Omnicell's control and are
subject to various risk factors that could cause actual results to
differ materially from those expressed or implied in any
forward-looking statement. Such statements include, but are not
limited to Omnicell's momentum, pipeline and new sales
opportunities, profit and revenue growth, and the success of
Omnicell's strategy for growth, including differentiated products,
expansion into new markets and targeted acquisitions. Risks that
contribute to the uncertain nature of the forward-looking
statements include our ability to take advantage of the growth
opportunities in medication management across the spectrum of
healthcare settings from long term care to home care, unfavorable
general economic and market conditions, risks to growth and
acceptance of our products and services, including competitive
conversions, and to growth of the clinical automation and workflow
automation market generally, the potential of increasing
competition, potential regulatory changes, the ability of the
company to improve sales productivity to grow product bookings, to
develop new products and to acquire and successfully integrate
companies. These and other risks and uncertainties are described
more fully in Omnicell's most recent filings with the Securities
and Exchange Commission. Prospective investors are cautioned not to
place undue reliance on forward-looking statements. All
forward-looking statements contained in this press release speak
only as of the date on which they were made. Omnicell undertakes no
obligation to update such statements to reflect events that occur
or circumstances that exist after the date on which they were
made.
Use of Non-GAAP Financial Information
This press release contains financial measures that are not
calculated in accordance with U.S. generally accepted accounting
principles (GAAP). Our management evaluates and makes operating
decisions using various performance measures. In addition to
Omnicell's GAAP results, we also consider non-GAAP gross profit,
non-GAAP operating expenses, non-GAAP income from operations,
non-GAAP net income, and non-GAAP net income per diluted share.
Additionally, we calculate Adjusted EBITDA (another non-GAAP
measure) by means of adjustments to GAAP Net Income. These non-GAAP
results should not be considered as an alternative to gross profit,
operating expenses, net income, net income per diluted share, or
any other performance measure derived in accordance with GAAP. We
present these non-GAAP results because we consider them to be
important supplemental measures of Omnicell's performance.
Our non-GAAP gross profit, non-GAAP operating expenses, non-GAAP
net income and non-GAAP net income per diluted share are exclusive
of certain items to facilitate management's review of the
comparability of Omnicell's core operating results on a period to
period basis because such items are not related to Omnicell's
ongoing core operating results as viewed by management. We define
our "core operating results" as those revenues recorded in a
particular period and the expenses incurred within that period that
directly drive operating income in that period. Management uses
these non-GAAP financial measures in making operating decisions
because, in addition to meaningful supplemental information
regarding operating performance, the measures give us a better
understanding of how we should invest in research and development,
fund infrastructure growth and evaluate the effectiveness of
marketing strategies. In calculating the these non-GAAP results,
management specifically adjusted for the following excluded
items:
a) Stock-based compensation expense impact of Accounting
Standards Codification (ASC) 718. We recognize
equity plan-related compensation expenses, which represent the fair
value of all share-based payments to employees, including grants of
employee stock options, as required under ASC 718, Compensation
- Stock Compensation (ASC 718) as non-GAAP adjustments
in each period.
b) Intangible assets amortization from business
acquisitions. We excluded from our non-GAAP results the
intangible assets amortization expense resulting from our past
acquisitions. These non-cash charges are not considered by
management to reflect the core cash-generating performance of the
business and therefore are excluded from our non-GAAP results.
c) Amortization of debt issuance cost. Debt issuance cost
represents costs associated with the issuance of new Term Loan and
Revolving Line of Credit facilities. The cost include underwriting
fees, original issue discount, ticking fee, legal fees, etc. This
non-cash expense is not considered by management to reflect the
core cash-generating performance of the business and therefore is
excluded from our non-GAAP results.
d) Acquisition accounting impacts related to deferred
revenue. In connection with our acquisition of Aesynt, business
combination rules require us to account for the fair values of
arrangements for which acceptance has not been obtained, and post
installation support has not been provided in our purchase
accounting. The non-GAAP adjustment to our sales is intended to
include the full amounts of such revenues. We believe the
adjustment to these revenues is useful as a measure of the ongoing
performance of our business.
e) Inventory fair value adjustments. In connection with
our acquisition of Aesynt, business combination rules require us to
account for the fair values of inventory acquired in our purchase
accounting. The non-GAAP adjustment to our Cost of Revenue is
intended to include the impact of such adjustment. We believe the
adjustment is useful as a measure of the ongoing performance of our
business.
f) Acquisitions related expenses. We excluded from our
non-GAAP results the expenses which are related to the recent
acquisitions. These expenses are unrelated to our ongoing
operations and we do not expect them to occur in the ordinary
course of business. We believe that excluding these acquisition
related expenses provides more meaningful comparisons of the
financial results to our historical operations and forward looking
guidance and the financial results of less acquisitive peer
companies. Further, these expenses are not considered by management
to reflect the core performance of the business and therefore are
excluded from our non-GAAP results.
g) Gain on business combination of an equity investment.
We excluded from our non-GAAP results the gain on a minority equity
investment in a private company, Avantec, which was recognized in
relation to the acquisition by Omnicell of the remainder of the
company. This non-cash gain is not considered by management to
reflect the core cash-generating performance of the business and
therefore is excluded from our non-GAAP results.
Management adjusts for the above items because management
believes that, in general, these items possess one or more of the
following characteristics: their magnitude and timing is largely
outside of Omnicell's control; they are unrelated to the ongoing
operation of the business in the ordinary course; they are unusual
and we do not expect them to occur in the ordinary course of
business; or they are non-operational, or non-cash expenses
involving stock compensation plans.
We believe that the presentation of these non-GAAP financial
measures is warranted for several reasons:
1) Such non-GAAP financial measures provide an additional
analytical tool for understanding Omnicell's financial performance
by excluding the impact of items which may obscure trends in the
core operating results of the business;
2) Since we have historically reported non-GAAP results to the
investment community, we believe the inclusion of non-GAAP numbers
provides consistency and enhances investors' ability to compare our
performance across financial reporting periods;
3) These non-GAAP financial measures are employed by Omnicell's
management in its own evaluation of performance and are utilized in
financial and operational decision making processes, such as budget
planning and forecasting; and
4) These non-GAAP financial measures facilitate comparisons to
the operating results of other companies in our industry, which use
similar financial measures to supplement their GAAP results, thus
enhancing the perspective of investors who wish to utilize such
comparisons in their analysis of our performance.
Set forth below are additional reasons why share-based
compensation expense related to ASC 718 is excluded from our
non-GAAP financial measures:
i) While share-based compensation calculated in accordance
with ASC 718 constitutes an ongoing and recurring expense of
Omnicell, it is not an expense that requires cash settlement by
Omnicell. We therefore exclude these charges for purposes of
evaluating core operating results. Thus, our non-GAAP measurements
are presented exclusive of stock-based compensation expense to
assist management and investors in evaluating our core operating
results.
ii) We present ASC 718 share-based compensation expense in
our reconciliation of non-GAAP financial measures on a pre-tax
basis because the exact tax differences related to the timing and
deductibility of share-based compensation, under ASC 718 are
dependent upon the trading price of Omnicell's common stock and the
timing and exercise by employees of their stock options. As a
result of these timing and market uncertainties the tax effect
related to share-based compensation expense would be inconsistent
in amount and frequency and is therefore excluded from our non-GAAP
results.
Our Adjusted EBITDA calculation is defined as earnings before
interest income and expense, taxes, depreciation and amortization,
and non-cash expenses, including ASC 718 stock compensation
expense, as well as excluding certain other non-GAAP
adjustments.
As stated above, we present non-GAAP financial measures because
we consider them to be important supplemental measures of
performance. However, non-GAAP financial measures have limitations
as an analytical tool and should not be considered in isolation or
as a substitute for Omnicell's GAAP results. In the future, we
expect to incur expenses similar to certain of the non-GAAP
adjustments described above and expect to continue reporting
non-GAAP financial measures excluding such items. Some of the
limitations in relying on non-GAAP financial measures are:
- Omnicell's stock option and stock purchase plans are important
components of incentive compensation arrangements and will be
reflected as expenses in Omnicell's GAAP results for the
foreseeable future under ASC 718.
- Other companies, including companies in Omnicell's industry,
may calculate non-GAAP financial measures differently than
Omnicell, limiting their usefulness as a comparative measure.
Pursuant to the requirements of SEC Regulation G, a detailed
reconciliation between Omnicell's non-GAAP and GAAP financial
results is set forth in the financial tables at the end of this
press release. Investors are advised to carefully review and
consider this information strictly as a supplement to the GAAP
results that are contained in this press release and in Omnicell's
SEC filings.
OMNICELL,
INC.
|
UNAUDITED PRO
FORMA CONDENSED COMBINED STATEMENTS OF OPERATIONS
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
Historical
|
|
|
|
|
|
|
Year
ended
|
|
|
|
|
|
|
December 31,
2015
|
September 30,
2015
|
Pro
Forma
|
Pro
Forma
|
|
|
|
|
Omnicell
|
Aesynt
|
Adjustments
|
Combined
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
Product
|
|
$
|
388,397
|
|
$
|
105,819
|
|
$
|
2,334
|
|
$
|
496,550
|
|
Services and other
revenues
|
|
96,162
|
|
84,311
|
|
(8,631)
|
|
171,842
|
|
Total
revenues
|
484,559
|
|
190,130
|
|
(6,297)
|
|
668,392
|
|
Cost of
revenues:
|
|
|
|
|
|
—
|
|
Cost of product
revenues
|
|
198,418
|
|
103,687
|
|
(16,082)
|
|
286,023
|
|
Cost of services and
other revenues
|
38,211
|
|
—
|
|
34,381
|
|
72,592
|
|
Total cost of
revenues
|
236,629
|
|
103,687
|
|
18,299
|
|
358,615
|
|
Gross
profit
|
|
|
247,930
|
|
86,443
|
|
(24,596)
|
|
309,777
|
|
Operating
expenses:
|
|
|
|
—
|
|
Research and
development
|
|
35,160
|
|
15,760
|
|
—
|
|
50,920
|
|
Selling, general
and administrative
|
167,581
|
|
68,300
|
|
(1,531)
|
|
234,350
|
|
Gain on the
equity investment
|
(3,443)
|
|
—
|
|
—
|
|
(3,443)
|
|
|
|
|
|
199,298
|
|
84,060
|
|
(1,531)
|
|
281,827
|
|
Income from
operations
|
|
48,632
|
|
2,383
|
|
(23,065)
|
|
27,950
|
|
Interest
and other income(expense), net
|
(2,388)
|
|
(5,126)
|
|
(2,503)
|
|
(10,017)
|
|
Income before
taxes
|
|
|
46,244
|
|
(2,743)
|
|
(25,568)
|
|
17,933
|
|
Income
taxes expense
|
15,484
|
|
201
|
|
(9,588)
|
|
6,097
|
|
Net income
|
|
|
$
|
30,760
|
|
$
|
(2,944)
|
|
$
|
(15,980)
|
|
$
|
11,836
|
|
Net income per
share:
|
|
|
|
|
|
Basic
|
|
|
$
|
0.86
|
|
|
—
|
|
$
|
0.33
|
|
|
Diluted
|
|
|
$
|
0.84
|
|
|
—
|
|
$
|
0.32
|
|
Shares used in
computing income per share:
|
|
|
|
|
|
Basic
|
|
|
35,857
|
|
|
—
|
|
35,857
|
|
|
Diluted
|
|
|
36,718
|
|
|
523
|
|
37,241
|
|
Omnicell, Inc.
|
Reconciliation of
Pro Forma Statement of Operations from GAAP to
Non-GAAP
|
(Unaudited, in
thousands, except per share data and percentages)
|
|
|
|
|
|
|
|
|
Year
Ended
|
|
|
|
|
|
|
|
December 31,
2015
|
|
|
|
GAAP Pro forma
combined net income
|
|
$
|
11,836
|
|
Adjustments:
|
|
|
|
Share-based
compensation expense
|
|
17,228
|
|
|
Intangible assets
amortization from business acquisitions
|
|
29,768
|
|
|
Amortization of debt
issuance cost
|
|
1,590
|
|
|
Acquisition
accounting impacts related to deferred revenue
|
|
7,984
|
|
|
Inventory fair value
adjustments
|
|
3,951
|
|
|
Acquisitions related
expenses
|
|
3,700
|
|
|
Gain on business
combination of an equity investment
|
|
(3,443)
|
|
|
Tax effect of the
adjustments above(a)
|
|
(14,807)
|
|
Non-GAAP Pro forma
net income
|
|
$
|
57,807
|
|
|
|
|
|
|
|
|
|
Pro forma combined
revenues
|
|
$
|
668,392
|
|
|
|
Acquisition
accounting impacts related to deferred revenue
|
|
7,984
|
|
Non-GAAP Pro forma
combined revenues
|
|
$
|
676,376
|
|
|
|
|
|
|
GAAP Pro forma gross
profit
|
|
309,777
|
|
|
GAAP Pro forma gross
margin
|
|
46.3%
|
|
|
Acquisition
accounting impacts related to deferred revenue
|
|
7,984
|
|
|
|
Share-based
compensation expense
|
|
2,111
|
|
|
|
Inventory fair value
adjustments
|
|
3,951
|
|
|
|
Amortization of
acquired intangibles
|
|
19,654
|
|
|
Non-GAAP Pro forma
gross profit
|
|
$
|
343,477
|
|
|
Non-GAAP Pro forma
gross margin
|
|
50.8%
|
|
|
|
GAAP Pro forma
operating expenses
|
|
$
|
281,827
|
|
|
GAAP operating
expenses % to total revenue
|
|
42.2%
|
|
Share-based
compensation expense
|
|
(15,117)
|
|
|
Intangible assets
amortization from business acquisitions
|
|
(10,114)
|
|
|
Acquisition related
expenses
|
|
(3,700)
|
|
|
Gain on business
combination of an equity investment
|
|
3,443
|
|
Non-GAAP Pro forma
operating expenses
|
|
$
|
256,339
|
|
|
Non-GAAP Pro forma
operating expenses % to total revenue
|
|
37.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years
Ended
|
|
|
|
|
|
|
|
December 31,
2015
|
|
|
|
GAAP Pro forma income
from operations
|
|
$
|
27,949
|
|
|
GAAP Pro forma
operating income % to total revenue
|
|
4.2%
|
|
Share-based
compensation expense
|
|
17,228
|
|
|
Intangible assets
amortization from business acquisitions
|
|
29,768
|
|
|
Acquisition
accounting impacts related to deferred revenue
|
|
7,984
|
|
|
Inventory fair value
adjustments
|
|
3,951
|
|
|
Acquisitions related
expenses
|
|
3,700
|
|
|
Gain on business
combination of an equity investment
|
|
(3,443)
|
|
Non-GAAP Pro forma
income from operations
|
|
$
|
87,137
|
|
|
Non-GAAP Pro forma
operating income % to total revenue
|
|
12.9%
|
|
|
|
|
|
|
|
|
GAAP Pro forma
Interest and other (expense), net
|
|
$
|
(10,017)
|
|
|
Amortization of debt
issuance cost
|
|
1,590
|
|
|
Non-GAAP Pro forma
Interest and other (expense), net
|
|
$
|
(8,427)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Pro forma shares
- diluted
|
|
37,241
|
|
|
|
|
|
|
|
|
|
GAAP Pro forma net
income per share - diluted
|
|
$
|
0.32
|
|
Adjustments:
|
|
|
|
Share-based
compensation expense
|
|
0.46
|
|
|
Intangible assets
amortization from business acquisitions
|
|
0.80
|
|
|
Amortization of debt
issuance cost
|
|
0.04
|
|
|
Acquisition
accounting impacts related to deferred revenue
|
|
0.21
|
|
|
Inventory fair value
adjustments
|
|
0.11
|
|
|
Acquisitions related
expenses
|
|
0.10
|
|
|
Gain on business
combination of an equity investment
|
|
(0.09)
|
|
|
Tax effect of the
adjustments above
|
|
(0.40)
|
|
Non-GAAP Pro forma
net income per share - diluted
|
|
$
|
1.55
|
|
|
|
|
GAAP Pro forma net
income
|
|
$
|
11,836
|
|
Add back:
|
|
|
|
Share-based
compensation expense
|
|
17,228
|
|
|
Interest
expense
|
|
6,428
|
|
|
Depreciation and
amortization expense
|
|
46,062
|
|
|
Income tax
expense
|
|
6,097
|
|
|
Acquisition related
expenses
|
|
3,700
|
|
|
Amortization of debt
issuance cost
|
|
1,590
|
|
|
Acquisition
accounting impacts related to deferred revenue
|
|
7,984
|
|
|
Gain on business
combination of an equity investment
|
|
(3,443)
|
|
Non-GAAP adjusted Pro
forma EBITDA (b)
|
|
$
|
97,482
|
|
|
|
|
|
|
|
|
|
Aesynt stand alone
Year Ended September 30, 2015 GAAP revenue
|
|
$
|
190,130
|
|
|
Acquisition
accounting impacts related to deferred revenue
|
|
851
|
|
Aesynt stand alone
year ended September 30, 2015 Non-GAAP revenue
|
|
$
|
190,981
|
|
|
|
|
|
|
|
|
|
Aesynt stand alone
Year Ended September 30, 2015 GAAP Pro forma net income
(loss)
|
|
$
|
(2,944)
|
|
Add back:
|
|
|
|
Share-based
compensation expense
|
|
490
|
|
|
Interest
expense
|
|
4,541
|
|
|
Depreciation and
amortization expense
|
|
9,453
|
|
|
Earn-out expense
associated with previous acquisitions
|
|
7,943
|
|
|
Acquisition related
expenses
|
|
802
|
|
|
Amortization of debt
issuance cost
|
|
564
|
|
|
Income tax
expense
|
|
201
|
|
|
Acquisition
accounting impacts related to deferred revenue
|
|
851
|
|
|
Inventory fair value
adjustment
|
|
1,503
|
|
Non-GAAP adjusted Pro
forma EBITDA
|
|
$
|
23,404
|
|
|
|
(a)
|
Tax effects
calculated for all adjustments except share based compensation
expense, using the effective tax rate of 33%.
|
(b)
|
Defined as earnings
before interest income and expense, taxes, depreciation and
amortization, and non-cash expenses, including stock compensation
expense, per ASC 718, as well as excluding certain non-GAAP
adjustments.
|
OMCL-E
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SOURCE Omnicell, Inc.