STEWARTVILLE, Minn.,
Nov. 13, 2012 /PRNewswire/
-- Rochester Medical Corporation (NASDAQ: ROCM) today
announced operating results for its fourth quarter and fiscal year
ended September 30, 2012.
The Company reported record sales and record income from
operations for the fourth quarter. Sales were $16,733,000 compared to $14,839,000 for the fourth quarter of last
year. Income from operations for the quarter was $1,687,000 compared to income from operations of
$588,000 in the fourth quarter of
last year. Net income for the fourth quarter of fiscal 2012
was $1,027,000 or $0.08 per diluted share compared to net income of
$407,000 or $0.03 per diluted share for the fourth quarter of
last year.
Fourth quarter sales increased 13% year over year (16% on a
constant currency basis) driven by a 14% increase in Rochester
Medical Direct Sales (19% on a constant currency basis) and a 7%
increase in Private Label Sales (7% on a constant currency
basis). Constant currency basis assumes current exchange
rates for all periods in order to exclude the impact of foreign
exchange variations. In the fourth quarter of fiscal 2012,
the U.S. dollar was somewhat stronger versus the pound sterling and
the Euro, thus negatively affecting Rochester Medical Direct Sales
growth levels in actual U.S. dollars given the significant volume
of direct sales in the United
Kingdom and The
Netherlands.
Net income adjusted for certain non-recurring unusual items and
certain recurring non-cash expenses, or "Non-GAAP Net Income" for
the current quarter was $1,366,000 or
$0.11 per diluted share compared to
Non-GAAP Net Income of $822,000 or
$0.07 per diluted share for the
fourth quarter of last year. The increase in Non-GAAP net
income for the fourth quarter is primarily due to increased gross
profit as a result of the higher sales versus last year.
For the fiscal year ended September 30,
2012, the Company reported record sales of $61,089,000 compared to sales of $52,919,000 for the previous year. It also
had a record $3,213,000 of income
from operations compared to a loss from operations of ($1,677,000) in fiscal 2011. The 15%
increase in annual total sales (18% on constant currency basis)
resulted from an 18% increase in Rochester Medical Direct Sales
(21% on a constant currency basis) and a 6% increase in Private
Label Sales (6% on a constant currency basis). The Company
reported net income for the year of $2,050,000 or $0.17
per diluted share compared to a net loss of ($1,315,000) or ($0.11) per diluted share for the previous
year. The increase in net income for this fiscal year was
primarily attributable to increased gross profit as a result of
higher sales.
Non-GAAP Net Income for the current year was $3,507,000 or $0.28
per diluted share compared to Non-GAAP Net Income of $1,073,000 or $0.09
per diluted share for the previous year. The increase was
primarily due to increased gross profit as a result of higher
sales.
Commenting on the results, Rochester Medical's CEO and President
Anthony J. Conway said, "We had a
solid quarter and a good year. Our Direct Sales continue to
grow nicely, especially our Intermittent Catheters which we sell
into an $800 million global market.
In the fourth quarter on a global basis, Intermittent
Catheters sales were up 44% overall. In the U.S.,
Intermittent Catheter sales were up 47%. This market is a
primary focus for the Company going forward. We expect to
introduce further advanced products into this marketplace in late
calendar year 2013.
"We announced last week that the Company will exit the Foley
Catheter marketplace. Though we have excellent products, our
rate of market penetration was simply not strong enough to justify
the considerable expense and attention that it required. We
are confident that the Company will be significantly stronger as a
result of our decision."
"The Company also announced an update to its three-year
strategic plan originally provided in November 2010. From
continuing operations the Company now expects Fiscal 2013 revenues
to be approximately $67 million and
net income to be approximately $7
million. The primary reasons for the change in the
strategic plan are the result of the discontinuation of the Foley
Catheter line, and to a lesser extent, a more conservative
assumption about the performance in our international sales
business given the broader economic challenges in Europe."
Conway continued, "As our updated plan indicates, despite the
reduction in our expected results of our three-year plan we
nonetheless have demonstrated solid growth in fiscal years 2011 and
2012 and, importantly, we continue to grow our business at a robust
rate. Total sales are expected to increase 17% year over year
after adjusting for the exclusion of Foley Catheter sales in both
years, and net income is expected to double from fiscal 2012 given
the higher level of profitability we expect to achieve. We
are looking forward to a good fiscal 2013."
Conference Call and Webcast
The Company will hold a
quarterly conference call on Tuesday,
November 13, 2012 to discuss its earnings report. The
call will begin at 3:30 p.m., Central
Time (4:30 p.m., Eastern
Time).
This call is being webcast by Thomson Reuters and can be
accessed at Rochester Medical's website at www.rocm.com. To
listen live to the conference call via telephone, call:
Domestic:
|
888 679
8038
|
International:
|
617 213
4850
|
Pass
code:
|
51602204
|
Preregistration:
https://www.theconferencingservice.com/prereg/key.process?key=PFBBPA8XA
|
|
Replay
will be available for seven days at www.rocm.com or via telephone
at:
|
Domestic:
|
888 286
8010
|
International:
|
617 801
6888
|
Pass
code:
|
63543382
|
Individual investors can listen to the call at
www.fulldisclosure.com, Thomson Reuters individual investor portal,
powered by StreetEvents. Institutional investors can access
the call via Thomson's password-protected event management site,
StreetEvents (www.streetevents.com).
Forward-Looking Statements
This press release contains
"forward-looking statements" with the meaning of the Private
Securities Litigation Reform Act of 1995. Such statements
include, but are not limited to, statements about the future
financial and operating results of Rochester Medical. Such
statements are based on currently available information, operating
plans and management's expectations about future events and
trends. Such statements inherently involve significant risks
and uncertainties that could cause actual results to differ
materially from those predicted in such forward-looking statements,
including the uncertainty of estimated revenues and profits, the
uncertainty of current domestic and international economic
conditions that could adversely affect the level of demand for the
Company's products and increased volatility in foreign exchange
rates, the uncertainty of market acceptance of new product
introductions, and our level of success in increasing
Rochester Medical Direct Sales revenue, the uncertainty of gaining
new strategic relationships or locating and capitalizing on
strategic opportunities, the uncertainty of timing of Private Label
Sales revenues (particularly international customers), FDA and
other regulatory review and response times, and other risk factors
listed from time to time in the Company's SEC reports and filings,
including, without limitation, the section entitled "Risk Factors"
in the Company's Annual Report on Form 10-K for the year ended
September 30, 2011, and quarterly
reports on Forms 10-Q. Readers are cautioned not to place
undue reliance on any such forward-looking statements, which speak
only as of the date they are made. The Company undertakes no
obligation to update any forward-looking statements, whether as a
result of new information, future events or otherwise.
Use of Non-GAAP Financial Measures
Rochester Medical
has provided Non-GAAP Net Income in addition to net income
calculated in accordance with generally accepted accounting
principles (GAAP) because management believes Non-GAAP Net Income
provides a more consistent basis for comparisons that are not
influenced by certain charges and non-cash expenses and are
therefore helpful in understanding Rochester Medical's underlying
operating results. Similarly, constant currency represents
reported sales with the cost/benefit of currency movements
removed. Management uses the measure to understand the growth
of the business on a constant dollar basis, as fluctuations in
exchange rates can distort the underlying growth of the business
both positively and negatively. While we recognize that
foreign exchange volatility is a reality for a global company, we
routinely review our Company performance on a constant dollar
basis, and we believe this also allows our shareholders to
understand better our Company's growth trends.
Non-GAAP Net Income and constant currency are not measures of
financial performance under GAAP, and should not be considered an
alternative to net income or any other measure of performance or
liquidity under GAAP. Non-GAAP Net Income and constant currency are
not comparable to information provided by other companies. Non-GAAP
Net Income and constant currency have limitations as analytical
tools and should not be considered in isolation or as a
substitution for analysis of our results as reported under
GAAP. Reconciliations of GAAP Net Income and Non-GAAP Net
Income, and reconciliations of sales under GAAP and sales on a
constant currency basis, are presented at the end of this press
release.
About Rochester Medical Corporation
Rochester Medical
Corporation develops, manufactures, and markets disposable medical
catheters and devices for urological and continence care
applications. The Company also sells certain ostomy and wound
and scar care products and other brands of urological products into
the European marketplace.
For further information, please contact Anthony J. Conway, President and Chief Executive
Officer or David A. Jonas, Chief
Financial Officer of Rochester Medical Corporation at (507)
533-9600 or Parice Halbert, CFA, at
Westwicke Partners (443) 213-0500. More information about
Rochester Medical is available on its website at
http://www.rocm.com.
ROCHESTER
MEDICAL CORPORATION
|
Reconciliation of Reported GAAP Revenue to Non-GAAP
Revenue in Constant Currency
|
For the
Three and Twelve months ended
|
September
30, 2012 and 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
Three
months ended
|
|
Twelve
months ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2012
|
2011
|
|
2012
|
2011
|
|
|
|
|
|
|
|
GAAP Sales
as Reported
|
|
$ 16,732,915
|
$ 14,839,311
|
|
$ 61,089,410
|
$ 52,918,875
|
British Sterling Exchange rate as reported
|
|
1.58
|
1.61
|
|
1.58
|
1.61
|
Euro
Exchange rate as reported
|
|
1.25
|
1.41
|
|
1.30
|
1.41
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant
Currency Sales
|
|
$ 16,732,915
|
$ 14,493,113
|
|
$ 61,089,410
|
$ 51,943,485
|
(1) Exchange rate used for Constant Currency
purposes
|
1.58
|
1.58
|
|
1.58
|
1.58
|
(2) Exchange rate used for Constant Currency
purposes
|
1.25
|
1.25
|
|
1.30
|
1.30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Effect
of Constant Currency Illustration - British Sterling
|
$
-
|
$
(83,417)
|
|
$
-
|
$
(333,008)
|
Net Effect
of Constant Currency Illustration - Euros
|
|
$
-
|
$ (262,781)
|
|
$
-
|
$ (642,382)
|
|
|
|
|
|
|
|
Total Net
Effect of Constant Currency Illustration
|
|
$
-
|
$ (346,198)
|
|
$
-
|
$ (975,390)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) For
illustrative purposes constant currency translates prior period
foreign sales at current exchange rates.
|
For Rochester Medical Corporation this
is the conversion rate of British pounds to US dollars. The
rate represents the average
exchange rate for the respective three or nine month
period.
|
(2) For
illustrative purposes constant currency translates prior period
foreign sales at current exchange rates.
|
For Rochester Medical Corporation this
is the conversion rate of Euros to US dollars. The rate
represents the average
exchange rate for the respective three or nine month
period.
|
|
|
|
|
|
|
|
ROCHESTER
MEDICAL CORPORATION
|
Reconciliation of Reported GAAP Net Income to
Non-GAAP Net Income
|
For the
Three and Twelve months ended
|
September
30, 2012 and 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
Three
months ended
|
|
Twelve
months ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2012
|
2011
|
|
2012
|
2011
|
|
|
|
|
|
|
|
GAAP Net
Income (Loss) as Reported
|
|
$ 1,027,000
|
$ 407,000
|
|
$ 2,050,000
|
$ (1,315,000)
|
|
|
|
|
|
|
|
Diluted
EPS as Reported
|
|
$
0.08
|
$
0.03
|
|
$
0.17
|
$
(0.11)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for non-recurring unusual
items:
|
|
|
|
|
|
|
Merger and acquisition costs for
Laprolan (1)
|
|
|
30,000
|
|
|
725,000
|
Subtotal
|
|
-
|
30,000
|
|
-
|
725,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for recurring non-cash
expenses:
|
|
|
|
|
|
|
Intangible amortization (2)
|
|
158,000
|
183,000
|
|
632,000
|
701,000
|
ASC 718 compensation expense
(3)
|
|
181,000
|
202,000
|
|
825,000
|
962,000
|
Subtotal
|
|
339,000
|
385,000
|
|
1,457,000
|
1,663,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP
Net Income
|
|
$ 1,366,000
|
$ 822,000
|
|
$ 3,507,000
|
$ 1,073,000
|
|
|
|
|
|
|
|
Non-GAAP
Diluted EPS
|
|
$
0.11
|
$
0.07
|
|
$
0.28
|
$
0.09
|
|
|
|
|
|
|
|
Weighted
Average Shares - Diluted
|
|
12,367,693
|
12,470,989
|
|
12,339,500
|
12,282,545
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Merger
and acquisition costs related to the purchase of Laprolan B.V. from
Fornix N.V.
|
|
|
|
|
|
|
|
(2)
Amortization of the intangibles acquired in June 2006 asset
acquisition from Coloplast AS and Mentor Corporation and the intangibles acquired in the
January 2011 aquisition of Laprolan from Fornix
N.V. Management believes these assets are
appreciating. This adjustment adds back amortization
expense for the three and twelve months ended
September 30, 2012 and 2011 related to certain intangibles.
The gross amount of amortization expense for the
three months ended September 30, 2012 and 2011
is $218,000 and $236,000 net of taxes of $60,000
and $53,000 for net amounts of $158,000 and $183,000
respectively. The gross amount of amortization
expense for the twelve months ended September 30, 2012
and 2011 is $872,000 and $901,000 net of taxes of
$240,000 and $200,000 for net amounts of $632,000
and $701,000 respectively.
|
|
|
|
|
|
|
|
(3)
Compensation expense mandated by ASC 718. This adjustment
adds back the compensation expense recorded
for stock options granted to employees and directors that vested
during the three and twelve months ended September
30, 2012 and 2011. The gross amount of compensation expense
for the three months ended September
30, 2012 and 2011 is $208,000 and $316,000 net of taxes of $27,000
and $114,000 for net amounts of $181,000
and $202,000 respectively. The gross amount of compensation
expense for the twelve months ended September
30, 2012 and 2011 is $984,000 and $1,495,000 net of taxes of
$159,000 and $533,000 for net amounts of
$825,000 and $962,000 respectively.
|
Rochester
Medical Corporation
|
|
|
|
|
|
Press
Release - F12 Fourth Quarter
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary
Statements Of Operations
|
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
Three
months ended
|
|
Twelve
months ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$
16,732,915
|
|
$
14,839,311
|
|
$
61,089,410
|
|
$
52,918,875
|
|
|
|
|
|
|
|
|
|
Cost of
sales
|
8,446,864
|
|
7,504,817
|
|
30,954,828
|
|
26,821,427
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
8,286,051
|
|
7,334,494
|
|
30,134,582
|
|
26,097,448
|
|
Gross
profit %
|
49.5%
|
|
49.4%
|
|
49.3%
|
|
49.3%
|
|
|
|
|
|
|
|
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
|
Marketing
and selling
|
4,401,448
|
|
4,613,771
|
|
17,560,971
|
|
18,263,141
|
|
Research
and development
|
207,385
|
|
256,266
|
|
1,190,095
|
|
1,008,767
|
|
General
and administrative
|
1,990,690
|
|
1,876,686
|
|
8,170,468
|
|
8,502,956
|
|
|
|
|
|
|
|
|
|
Total
operating expenses
|
6,599,523
|
|
6,746,723
|
|
26,921,534
|
|
27,774,864
|
|
|
|
|
|
|
|
|
|
Income
(loss) from operations
|
1,686,528
|
|
587,771
|
|
3,213,048
|
|
(1,677,416)
|
|
|
|
|
|
|
|
|
|
Other
income (expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
15,126
|
|
(14,293)
|
|
43,243
|
|
139,859
|
|
Interest
expense
|
-
|
|
(51,917)
|
|
(89,545)
|
|
(277,008)
|
|
Other
income
|
(126,850)
|
|
(72,145)
|
|
(84,458)
|
|
(123,901)
|
|
|
|
|
|
|
|
|
|
Net income
(loss) before income taxes
|
1,574,804
|
|
449,416
|
|
3,082,288
|
|
(1,938,466)
|
|
|
|
|
|
|
|
|
|
Income tax
expense(benefit)
|
547,410
|
|
42,277
|
|
1,031,804
|
|
(623,162)
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
1,027,394
|
|
$
407,139
|
|
$
2,050,484
|
|
$
(1,315,304)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings
(loss) per common share - Basic
|
$
0.09
|
|
$
0.03
|
|
$
0.17
|
|
$
(0.11)
|
|
|
|
|
|
|
|
|
|
Earnings
(loss) per common share - Diluted
|
$
0.08
|
|
$
0.03
|
|
$
0.17
|
|
$
(0.11)
|
|
|
|
|
|
|
|
|
|
Weighted
Average Shares:
|
12,020,167
|
|
12,205,299
|
|
12,032,113
|
|
12,217,900
|
|
Basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
Average Shares:
|
|
|
|
|
|
|
|
|
Diluted
|
12,367,693
|
|
12,470,989
|
|
12,339,500
|
|
12,217,900
|
Rochester
Medical Corporation
|
|
|
Press
Release - F12 Fourth Quarter
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Balance Sheets
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
Cash and
equivalents
|
$
13,921,363
|
|
$
8,722,935
|
|
|
Marketable
securities
|
6,779,695
|
|
26,182,308
|
|
|
Accounts
receivable
|
11,008,429
|
|
8,644,332
|
|
|
Inventories
|
9,883,651
|
|
11,278,694
|
|
|
Prepaid
expenses and other assets
|
1,726,908
|
|
1,361,259
|
|
|
Deferred
income tax asset
|
1,287,177
|
|
1,618,495
|
|
|
|
|
|
|
|
|
|
|
Total
current assets
|
44,607,223
|
|
57,808,023
|
|
|
|
|
|
|
|
|
Property
and equipment, net
|
11,862,073
|
|
12,052,685
|
|
Deferred
income tax asset
|
1,030,994
|
|
1,242,010
|
|
Intangible
assets, net
|
9,377,354
|
|
10,272,671
|
|
Goodwill
|
|
9,053,091
|
|
9,094,725
|
|
|
|
|
|
|
|
|
Total
Assets
|
$
75,930,735
|
|
$
90,470,114
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Accounts
payable
|
$
3,070,329
|
|
$
2,773,398
|
|
|
Accrued
expenses
|
3,427,397
|
|
2,961,270
|
|
|
Short-term
debt
|
-
|
|
17,862,185
|
|
|
|
|
|
|
|
|
|
|
Total
current liabilities
|
6,497,726
|
|
23,596,853
|
|
|
|
|
|
|
|
|
Long-term
liabilities
|
1,137,212
|
|
896,414
|
|
|
|
|
|
|
|
|
Stockholders' equity
|
68,295,797
|
|
65,976,847
|
|
|
|
|
|
|
|
|
Total
Liabilities and Stockholder Equity
|
$
75,930,735
|
|
$
90,470,114
|
SOURCE Rochester Medical Corporation