SAN DIEGO, April 23, 2015 /PRNewswire/ -- ResMed Inc.
(NYSE: RMD) today announced results for its quarter ended
March 31, 2015. Revenue for the
quarter was $422.5 million, a 6
percent increase compared to the quarter ended March 31, 2014 (a 13 percent increase on a
constant currency basis). Net income was $91.0 million, an increase of 1 percent compared
to the quarter ended March 31,
2014. Diluted earnings per share for the quarter were
$0.64, an increase of 2 percent
compared to the quarter ended March
31, 2014. Non-GAAP diluted earnings per share for the
quarter were $0.65, a 2 percent
increase compared to the quarter ended March
31, 2014.
"We are pleased to report excellent progress with our new
product launches, as we continued to see double-digit revenue
growth," said Mick Farrell, ResMed's
chief executive officer. "Strong demand for our new flow generator
launches in the U.S. and continued growth in our Asia Pacific and Europe regions drove our results in the
quarter.
"We saw strong customer adoption of our range of new flow
generators: the Astral, AirSenseā¢ 10 and the recently launched
AirCurveā¢ 10 series of cloud-connected bilevel devices. This
quarter, we continued to build our informatics capabilities with
the acquisition of Jaysec, a provider of cloud-based software
solutions for the home medical equipment industry, as well as the
integration of our AirView patient management system with leading
informatics partners." Farrell concluded, "We are executing on our
long-term strategy: growing our core sleep disordered breathing
market and investing in future opportunities in chronic obstructive
pulmonary disease as well as cardio-respiratory conditions. Our
innovative products and solutions improve patient outcomes, lower
healthcare costs, and reduce the impact of chronic disease."
Analysis of third quarter results
In the third
quarter of fiscal year 2015, revenue in the Americas was
$250.9 million, a 16 percent increase
over the prior year's quarter. Revenue in combined
Europe and Asia Pacific was $171.6
million, a 6 percent decrease compared to the quarter ended
March 31, 2014 (a 9 percent increase
on a constant currency basis).
Gross margin in the third quarter was 59.5 percent, lower than
the prior year, mainly due to declines in average selling prices,
an unfavorable product and geographic mix, and an unfavorable
impact from foreign exchange rate movements.
Selling, general and administrative expenses were $116.3 million for the quarter, a 1 percent
increase (a 10 percent increase on a constant currency basis) over
the quarter ended March 31, 2014.
SG&A expenses improved to 27.5 percent of revenue in the
quarter, compared to 28.9 percent in the quarter ended March 31, 2014.
Research and development expenses were $27.0 million for the quarter, or 6.4 percent of
revenue. R&D expenses decreased by 8 percent (a 4 percent
increase on a constant currency basis) compared to the quarter
ended March 31, 2014.
Operating profit for the quarter was $105.9 million and cash flow from operations was
$90.9 million.
Amortization of acquired intangible assets was $2.2 million ($1.6
million, net of tax) during the quarter. Stock-based
compensation costs incurred during the quarter of $11.7 million ($8.2
million, net of tax) consisted of expenses associated with
employee equity grants, and the company's employee stock purchase
plan.
Share repurchase program
During the quarter,
the company repurchased 300,000 shares at a cost of $20.3 million, as part of its ongoing capital
management program.
Dividend program
The ResMed board of directors today declared a quarterly dividend
of $0.28 per share. The dividend will
have a record date of May 21, 2015,
payable on June 18, 2015. The
dividend will be paid in U.S. currency to holders of ResMed's
common stock trading on the New York Stock Exchange. Holders of
Chess Depositary Instruments trading on the Australian Securities
Exchange will receive an equivalent amount in Australian currency,
based on the exchange rate on the record date, and reflecting the
10:1 ratio between CDIs and NYSE shares. The ex-dividend date will
be May 19, 2015 for common stock
holders and for CDI holders. ResMed has received a waiver from the
ASX's settlement operating rules, which will allow ResMed to defer
processing conversions between its common stock and CDI registers
from May 19, 2015 through
May 21, 2015, inclusive.
Webcast details
ResMed will discuss its
financial and business results and its business outlook on its
webcast at 1:30 p.m. U.S. Pacific
Standard Time today. The live webcast of the call can be accessed
on ResMed's website at www.resmed.com. Please allow extra time
before the call to visit the website and download the streaming
media player (Windows Media Player), required to listen to the
internet broadcast. The online archive of the broadcast will be
available after the live call on ResMed's website. In addition, a
telephone replay of the conference call will be available
approximately two hours after the call by dialing 630-652-3042
(U.S.) and +1 630-652-3042 (international) and entering a passcode
of 39335543. The telephone replay will be available until
May 7, 2015.
About ResMed
The global team at ResMed
(NYSE:RMD) is united in their commitment to changing lives with
every breath. With more than 4,000 employees and a presence
in over 100 countries, the company has been pioneering new and
innovative devices and treatments for sleep-disordered
breathing, chronic obstructive pulmonary disease, and other
chronic diseases for more than 25 years. ResMed's world-leading
products and innovative solutions improve the quality of life for
millions of patients worldwide, reduce the impact of chronic
disease, and save healthcare costs. For more information about
ResMed and its businesses, visit www.resmed.com or follow
@resmed on Twitter.
Safe harbor statement
Statements contained in
this release that are not historical facts are "forward-looking"
statements as contemplated by the Private Securities Litigation
Reform Act of 1995. These forward-looking statements -- including
statements regarding ResMed's projections of future revenue or
earnings, expenses, new product development, new product
launches and new markets for its products -- are subject to
risks and uncertainties, which could cause actual results to
materially differ from those projected or implied in the
forward-looking statements. Additional risks and uncertainties are
discussed in ResMed's periodic reports on file with the U.S.
Securities & Exchange Commission. ResMed does not
undertake to update its forward-looking statements.
Investors:
Agnes Lee
Senior Director, Investor Relations
(858) 836-5971
investorrelations@resmed.com
News Media:
Alison Graves
Director, Global Corporate Communications
(858) 836-6789
news@resmed.com
RESMED INC AND
SUBSIDIARIES
|
Condensed
Consolidated Statements of Income (Unaudited)
|
(In thousands, except
per share data)
|
|
|
Three Months
Ended
March 31,
|
Nine Months
Ended
March 31,
|
|
2015
|
2014
|
2015
|
2014
|
|
|
|
|
|
Net
revenue
|
$422,497
|
$397,758
|
$1,225,848
|
$1,139,762
|
Cost of
sales
|
171,066
|
145,970
|
473,882
|
411,234
|
Gross
profit
|
251,431
|
251,788
|
751,966
|
728,528
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
Selling, general and
administrative
|
116,336
|
115,101
|
349,377
|
328,172
|
Research and
development
|
27,024
|
29,530
|
86,342
|
86,430
|
Amortization of
acquired intangible assets
|
2,203
|
2,459
|
6,558
|
7,325
|
Total operating
expenses
|
145,563
|
147,090
|
442,277
|
421,927
|
Income from
operations
|
105,868
|
104,698
|
309,689
|
306,601
|
|
|
|
|
|
Other income
(expenses), net:
|
|
|
|
|
Interest income
(expense), net
|
4,761
|
6,015
|
15,765
|
19,182
|
Other, net
|
3,729
|
2,199
|
6,346
|
(1,340)
|
Total other income
(expenses), net
|
8,490
|
8,214
|
22,111
|
17,842
|
|
|
|
|
|
Income before income
taxes
|
114,358
|
112,912
|
331,800
|
324,443
|
Income
taxes
|
23,375
|
22,943
|
66,376
|
66,908
|
Net income
|
$90,983
|
$89,969
|
$265,424
|
$257,535
|
|
|
|
|
|
Basic earnings per
share
|
$0.65
|
$0.64
|
$1.89
|
$1.82
|
Diluted earnings per
share
|
$0.64
|
$0.63
|
$1.86
|
$1.78
|
|
|
|
|
|
Basic shares
outstanding
|
140,792
|
140,959
|
140,341
|
141,774
|
Diluted shares
outstanding
|
142,813
|
143,375
|
142,614
|
144,758
|
|
|
|
|
|
RESMED INC AND
SUBSIDIARIES
|
Condensed
Consolidated Balance Sheets (Unaudited - In thousands)
|
|
|
March 31,
|
June 30,
|
|
2015
|
2014
|
Assets
|
|
|
Current
assets:
|
|
|
Cash and cash
equivalents
|
$866,325
|
$905,730
|
Accounts receivable,
net
|
345,485
|
359,593
|
Inventories
|
225,191
|
165,418
|
Prepayments, deferred
income taxes and other current assets
|
115,769
|
125,468
|
Total current
assets
|
1,552,770
|
1,556,209
|
Property, plant and
equipment, net
|
384,160
|
434,277
|
Goodwill and other
intangible assets, net
|
302,339
|
334,510
|
Deferred income taxes
and other non-current assets
|
38,760
|
35,966
|
Total non-current
assets
|
725,259
|
804,753
|
Total
assets
|
$2,278,029
|
$2,360,962
|
Liabilities and
Stockholders' Equity
|
|
|
Current
liabilities:
|
|
|
Accounts
payable
|
$70,900
|
$85,405
|
Accrued
expenses
|
131,770
|
130,656
|
Deferred
revenue
|
37,295
|
42,370
|
Income taxes
payable
|
15,800
|
10,392
|
Deferred income
taxes
|
639
|
717
|
Current portion of
long-term debt
|
0
|
18
|
Total current
liabilities
|
256,404
|
269,558
|
Non-current
liabilities:
|
|
|
Deferred income
taxes
|
8,831
|
10,716
|
Deferred
revenue
|
14,184
|
16,352
|
Income taxes
payable
|
1,754
|
5,318
|
Non-current portion
of long-term debt
|
460,581
|
300,770
|
Total non-current
liabilities
|
485,350
|
333,156
|
Total
liabilities
|
741,754
|
602,714
|
Stockholders'
Equity:
|
|
|
Common
stock
|
563
|
561
|
Additional paid-in
capital
|
1,195,880
|
1,117,644
|
Retained
earnings
|
1,927,958
|
1,780,396
|
Treasury
stock
|
(1,388,623)
|
(1,291,910)
|
Accumulated other
comprehensive income
|
(199,503)
|
151,557
|
Total stockholders'
equity
|
$1,536,275
|
$1,758,248
|
|
|
|
Total liabilities and
stockholders' equity
|
$2,278,029
|
$2,360,962
|
|
|
|
RESMED INC AND
SUBSIDIARIES
|
Condensed
Consolidated Statements of Cash Flows (Unaudited - In
thousands)
|
|
|
Nine Months
Ended
March 31,
|
Nine Months
Ended
March 31,
|
|
2015
|
2014
|
Cash flows from
operating activities:
|
|
|
Net income
|
$265,424
|
$257,535
|
Adjustment to
reconcile net income to net cash provided by operating
activities:
|
|
|
Depreciation and
amortization
|
55,310
|
53,631
|
Gain on disposal of
business
|
(709)
|
-
|
Stock-based
compensation costs
|
34,802
|
32,679
|
Foreign currency
revaluation
|
(1,252)
|
(3,305)
|
Excess tax benefit
from stock-based compensation arrangements
|
(20,738)
|
(11,388)
|
Changes in operating
assets and liabilities, net of effect of acquisitions:
|
|
|
Accounts receivable,
net
|
(14,814)
|
(12,873)
|
Inventories,
net
|
(80,793)
|
(15,735)
|
Prepaid expenses, net
deferred income taxes and other current assets
|
(3,487)
|
(4,020)
|
Accounts payable,
accrued expenses and other liabilities
|
49,736
|
(20,839)
|
Net cash provided by
operating activities
|
283,479
|
275,685
|
Cash flows from
investing activities:
|
|
|
Purchases of
property, plant and equipment
|
(50,266)
|
(54,210)
|
Patent registration
costs
|
(7,109)
|
(5,691)
|
Business
acquisitions, net of cash acquired
|
(26,956)
|
(3,172)
|
Investments in
cost-method investments
|
(10,500)
|
(5,275)
|
Proceeds from sale of
business
|
468
|
-
|
Purchases of foreign
currency options
|
-
|
(1,337)
|
Payments on maturity
of foreign currency contracts
|
(25,232)
|
(2,466)
|
Net cash used in
investing activities
|
(119,595)
|
(72,151)
|
Cash flows from
financing activities:
|
|
|
Proceeds from
issuance of common stock, net
|
23,176
|
15,624
|
Excess tax benefit
from stock-based compensation arrangements
|
20,738
|
11,388
|
Purchases of treasury
stock
|
(103,295)
|
(169,398)
|
Payment of business
combination contingent consideration
|
(458)
|
(1,117)
|
Proceeds from
borrowings, net of borrowing costs
|
160,000
|
507,838
|
Repayment of
borrowings
|
(1,527)
|
(415,029)
|
Dividends
paid
|
(117,862)
|
(106,387)
|
Net cash (used in) /
provided by financing activities
|
(19,228)
|
(157,081)
|
Effect of exchange
rate changes on cash
|
(184,061)
|
16,062
|
Net increase /
(decrease) in cash and cash equivalents
|
(39,405)
|
62,515
|
Cash and cash
equivalents at beginning of period
|
905,730
|
876,048
|
Cash and cash
equivalents at end of period
|
866,325
|
938,563
|
Reconciliation of
Non-GAAP Financial Measures (Unaudited)
|
(In US$ thousands,
except share and per share data)
|
|
The measure,
"non-GAAP operating income" is reconciled with GAAP income from
operations below:
|
|
|
Three Months
Ended
Mar 31,
|
Nine Months
Ended
Mar 31,
|
|
2015
|
2014
|
2015
|
2014
|
GAAP income from
operations
|
105,868
|
104,698
|
309,689
|
306,601
|
Amortization of
acquired intangible assets (A)
|
2,203
|
2,459
|
6,558
|
7,325
|
Non-GAAP operating
income (excluding the impact of amortization of acquired intangible
assets)
|
108,071
|
107,157
|
316,247
|
313,926
|
|
The measure,
"non-GAAP net income" and "non-GAAP diluted earnings per share" are
reconciled with GAAP net income and GAAP diluted earnings per share
in the table below:
|
|
|
Three Months
Ended
Mar 31,
|
Nine Months
Ended
Mar 31,
|
|
2015
|
2014
|
2015
|
2014
|
GAAP net
income
|
90,983
|
89,969
|
265,424
|
257,535
|
Amortization of
acquired intangible assets, net of tax
(A)
|
1,643
|
1,868
|
4,951
|
5,563
|
Non-GAAP net income
(excluding the impact of amortization of acquired intangible
assets)
|
92,626
|
91,837
|
270,375
|
263,098
|
Diluted shares
outstanding
|
142,813
|
143,375
|
142,614
|
144,758
|
GAAP diluted earnings
per share
|
$0.64
|
$0.63
|
$1.86
|
$1.78
|
Non-GAAP diluted
earnings per share (excluding the impact of amortization of
acquired intangible assets)
|
$0.65
|
$0.64
|
$1.90
|
$1.82
|
|
|
(A)
|
Management excludes
amortization of acquired intangible assets from its evaluation of
ongoing operations and believes investors benefit from excluding
these charges to facilitate a more meaningful evaluation of current
operating performance.
|
|
|
|
ResMed believes that
presenting diluted earnings per share, excluding the impact of the
amortization of acquired intangible assets is an additional measure
of performance that investors can use to compare operating results
between reporting periods.
|
|
|
|
Management uses
non-GAAP information internally in planning, forecasting, and
evaluating the results of operations in the current period and in
comparing it to past periods. Management believes this information
provides investors better insight in evaluating the Company's
performance from core operations and provides consistency in
financial reporting. Our use of non-GAAP measures is intended to
supplement, and not to replace, our presentation of net income and
other GAAP measures. Like all non-GAAP measures, non-GAAP earnings
are subject to inherent limitations because they do not include all
the expenses that must be included under GAAP.
|
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