Full Press Release Details
IRIDEX Reports 2016 Third Quarter, Nine-Month Results
Cyclo G6 Glaucoma Laser Platform Third Quarter Revenues Up 442 Percent Year-over-Year
Mountain View, CA. - November 3, 2016 - IRIDEX Corporation (Nasdaq: IRIX) today reported financial results for the third quarter and nine months ended October 1, 2016.
Revenues were $9.8 million for the third quarter of 2016, flat from $9.8 million for the 2015 third quarter. Growth in revenues from the Company's Cyclo G6 glaucoma laser platform, which increased 442 percent compared to the third quarter of 2015, was offset by lower revenues in certain retina products although the Company ended the third quarter with a record high in back orders. For the first nine months of 2016, revenues were $33.6 million compared to $29.6 million in the prior year period, an increase of 13.4%.
Gross margin for the 2016 third quarter was 43.4 percent compared to 49.3 percent for the third quarter of the prior year. Gross margin was impacted in the 2016 third quarter by an increase in manufacturing overhead and an increase in manufacturing variances.
The operating loss for the 2016 third quarter was $1.2 million compared to an operating income of $0.1 million for the 2015 third quarter.
Net loss for the third quarter of 2016 was $0.7 million, or $0.07 loss per share, compared to a net income of $0.4 million, or $0.04 income per share, for the prior year period. Net loss for the first nine months of 2016 was $0.9 million, or $0.09 loss per share, compared to a net income of $0.0 million, or $0.00 income per share, in the first nine months of 2015.
Guidance: The Company continues to expect revenue growth for the full year 2016 to be in the low double-digits. For the fourth quarter of 2016, the Company anticipates revenues of $12.4 million to $12.9 million.
Recent Business Highlights
IRIDEX management will conduct a conference call later today, Thursday, November 3, 2016, at 5:00 pm Eastern Time. Interested parties may access the live conference call by dialing (877) 407-0784 (US) or (201) 689-8560 (International) and requesting the IRIDEX 2016 Third Quarter Results Conference Call, or by visiting the Company's website at www.iridex.com. A telephone replay will be available beginning on Thursday, November 3, 2016 through Thursday, November 10, 2016 by dialing (844) 512-2921 (US) or (412) 317-6671 (International) and entering Replay Pin # 13647465. In addition, later today an archived version of the webcast will be available on the Company's website at www.iridex.com.
IRIDEX Corporation was founded in 1989 and is a worldwide leader in developing, manufacturing, and marketing innovative and versatile laser-based medical systems, delivery devices and consumable instrumentation for the ophthalmology market. We maintain a deep commitment to the success of our customers, with comprehensive technical, clinical, and service support programs. IRIDEX is dedicated to a standard of excellence, offering superior technology for superior results. IRIDEX products are sold in the United States through a direct sales force and internationally through a combination of a direct sales force and a network of approximately 70 independent distributors into over 100 countries. For further information, visit the IRIDEX website at http://www.iridex.com/.
Safe Harbor Statement
This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934, as amended, including those statements the Company's guidance concerning its results for full year 2016 and fourth quarter 2016, including anticipated ranges of revenue and revenue growth; the causes of back orders with certain retina products and the Company's expectations to resolve
those issues and ship its back orders; future demand and order levels for the Company's products; regulatory approvals and future product releases; the availability of funds under the Company's loan facilities; future marketing activities; and the Company's strategic plans and objectives. These statements are not guarantees of future performance and actual results may differ materially from those described in these forward-looking statements as a result of a number of factors, including: the Company's ongoing evaluation of the causes of the issues experienced in the 2016 third quarter; quality and control and production issues; defects in product design; risks associated with international sales; general economic and political conditions globally or regionally; business and economic conditions in the industries in which the Company operates; the ability to develop new products; the ability of new and existing products to achieve and maintain market acceptance; increases in and effects of competition; uncertainty regarding healthcare reform measures and changes in third-party coverage and reimbursement policies; changes in collaborative relationships; changes in unit pricing of products; changes in sales force or distributor relationships; any failure to manage growth in the Company's business, including growth through acquisitions; any failure to maintain or successfully protect intellectual property rights; any loss of key personnel; any failure to accurately forecast demand for the Company's products; reliance on sole and limited source suppliers; the impact of FDA, environmental and other regulations on business; any failure to comply with regulatory and legal requirements; loss of reputation, including as a result of any misuse of products; any recalls of products; and product liability and other legal claims. Please see a detailed description of these and other risks contained in the Company's Annual Report on Form 10-K for the fiscal year ended January 2, 2016, and Quarterly Reports on Form 10-Q for subsequent fiscal quarters, each of which was filed with the Securities and Exchange Commission. Forward-looking statements contained in this announcement are made as of this date and will not be updated.
| Company Contact: | Investor Relations Contact: | ||
| Atabak Mokari | Matt Clawson | ||
| CFO & VP, Corporate Development | Pure Communications | ||
| 650-940-4700 | 949-370-8500 | ||
| matt@purecommunicationsinc.com |
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
| Three Months Ended | Nine Months Ended | |||||||||||||||
| October 1, | October 3, | October 1, | October 3, | |||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||||
| Total revenues | $ | 9,789 | $ | 9,815 | $ | 33,628 | $ | 29,644 | ||||||||
| Cost of revenues | 5,544 | 4,974 | 18,352 | 15,176 | ||||||||||||
| Gross profit | 4,245 | 4,841 | 15,276 | 14,468 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 1,256 | 1,237 | 4,007 | 4,000 | ||||||||||||
| Sales and marketing | 2,378 | 2,234 | 7,212 | 6,463 | ||||||||||||
| General and administrative | 1,858 | 1,227 | 5,546 | 4,206 | ||||||||||||
| Total operating expenses | 5,492 | 4,698 | 16,765 | 14,669 | ||||||||||||
| (Loss) income from operations | (1,247 | ) | 143 | (1,489 | ) | (201 | ) | |||||||||
| Other (expense) income, net | (51 | ) | 164 | (83 | ) | 134 | ||||||||||
| (Loss) income from operations before benefit from income taxes | (1,298 | ) | 307 | (1,572 | ) | (67 | ) | |||||||||
| Benefit from income taxes | (627 | ) | (135 | ) | (674 | ) | (103 | ) | ||||||||
| Net (loss) income | $ | (671 | ) | $ | 442 | $ | (898 | ) | $ | 36 | ||||||
| Net (loss) income per share: | ||||||||||||||||
| Basic | $ | (0.07 | ) | $ | 0.04 | $ | (0.09 | ) | $ | 0.00 | ||||||
| Diluted | $ | (0.07 | ) | $ | 0.04 | $ | (0.09 | ) | $ | 0.00 | ||||||
| Weighted average shares used in computing net (loss) income per share: | ||||||||||||||||
| Basic | 10,129 | 9,972 | 10,083 | 9,956 | ||||||||||||
| Diluted | 10,129 | 10,094 | 10,083 | 10,142 |
Condensed Consolidated Balance Sheets
| October 1, | January 2, | |||||||
| 2016 | 2016 | |||||||
| Assets | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 9,577 | $ | 9,995 | ||||
| Accounts receivable, net | 7,926 | 9,282 | ||||||
| Inventories | 12,678 | 11,106 | ||||||
| Prepaids and other current assets | 1,225 | 386 | ||||||
| Total current assets | 31,406 | 30,769 | ||||||
| Property and equipment, net | 1,447 | 1,104 | ||||||
| Intangible assets, net | 256 | 268 | ||||||
| Goodwill | 533 | 533 | ||||||
| Deferred income taxes-long term | 8,985 | 8,985 | ||||||
| Other long-term assets | 87 | 164 | ||||||
| Total assets | $ | 42,714 | $ | 41,823 | ||||
| Liabilities and Stockholders' Equity | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable | $ | 2,472 | $ | 2,223 | ||||
| Accrued compensation | 1,574 | 1,572 | ||||||
| Accrued expenses | 1,622 | 1,722 | ||||||
| Accrued warranty | 570 | 603 | ||||||
| Deferred revenue | 1,305 | 1,311 | ||||||
| Total current liabilities | 7,543 | 7,431 | ||||||
| Long-Term Liabilities: | ||||||||
| Other long-term liabilities | 619 | 704 | ||||||
| Total liabilities | 8,162 | 8,135 | ||||||
| Stockholders' equity: | ||||||||
| Common stock | 112 | 111 | ||||||
| Additional paid-in capital | 39,747 | 37,986 | ||||||
| Accumulated deficit | (5,307 | ) | (4,409 | ) | ||||
| Total stockholders' equity | 34,552 | 33,688 | ||||||
| Total liabilities and stockholders' equity | $ | 42,714 | $ | 41,823 |