Full Press Release Details
SUNNYVALE, Calif., Feb. 1, 2007 (PRIME NEWSWIRE) -- Intuitive Surgical, Inc. (Nasdaq:ISRG), the industry leader in surgical robotics, today reported fourth quarter 2006 revenue of $112.6 million, increasing 56% from $72.1 million for the fourth quarter of 2005. Higher revenue was driven by increased da Vinci(r) Surgical System sales and continued growth in recurring revenue.
Fourth quarter 2006 instrument and accessory revenue increased 62% to $33.3 million from $20.6 million during the fourth quarter of 2005. Fourth quarter 2006 system revenue increased 53% to $63.0 million from $41.3 million during the fourth quarter of 2005. Fourth quarter 2006 service and training revenue increased 60% to $16.3 million from $10.2 million during the fourth quarter of 2005.
Revenue for the year ended December 31, 2006 totaled $372.7 million, increasing 64% from $227.3 million for the year ended December 31, 2005.
Three Months Ended Twelve Months Ended
December 31, December 31,
Revenue ------------------------ ------------------------
($ Millions) 2006 2005 Increase 2006 2005 Increase
------ ------ -------- ------ ------ --------
Accessories $ 33.3 $ 20.6 $ 12.7 $111.7 $ 67.8 $ 43.9
Systems 63.0 41.3 21.7 205.9 124.6 81.3
Training 16.3 10.2 6.1 55.1 34.9 20.2
------ ------ ------ ------ ------ ------
$112.6 $ 72.1 $ 40.5 $372.7 $227.3 $145.4
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Fourth quarter 2006 operating income was $35.4 million compared with $23.5 million for the fourth quarter of 2005. Operating results for the fourth quarter of 2006 included $6.8 million of stock compensation expense in accordance with the Financial Accounting Standards Board SFAS 123R. Excluding the $6.8 million of non-cash stock compensation expense, fourth quarter 2006 operating income was $42.2 million, up 80% compared with the fourth quarter of 2005.
Fourth quarter 2006 net income, including non-cash stock compensation expense, was $23.6 million, or $0.62 per diluted share. Excluding the impact of stock compensation expenses, fourth quarter 2006 net income was $28.1 million, or $0.73 per diluted share. Fourth quarter 2005 net income of $49.5 million included a tax benefit of $22.2 million associated with the recognition of deferred tax assets.
Net income for the year ended December 31, 2006, including non-cash stock compensation expense, was $72.0 million, or $1.89 per diluted share. Excluding the impact of stock compensation expenses, net income for the twelve months ended December 31, 2006 was $88.3 million, or $2.32 per diluted share.
Fourth quarter 2006 earnings before interest, taxes, depreciation, amortization, and non-cash stock compensation expenses (EBITDA) was $45.1 million, up 78% compared to $25.3 million for the fourth quarter 2005. EBITDA for the twelve months ended December 31, 2006 was $142.4 million, up 89% compared to $75.5 million for the twelve months ended December 31, 2005.
Intuitive ended the fourth quarter of 2006 with cash, cash equivalents and investments of $330.3 million, up $38.0 million from the end of the previous quarter and up $127.6 million from fiscal year 2005.
Commenting on the announcement, Lonnie Smith, Chairman and CEO of Intuitive Surgical, said, "We are pleased with our fourth quarter revenue and earnings growth. Our financial results reflect the ongoing adoption of robotic surgery, driven by patients seeking out superior surgical outcomes enabled by the da Vinci(r) Surgical System."
The Company will also announce these results at a conference call today at 1:30 pm PDT. The dial-in numbers for the call are 877-909-3508 for participants located in the U.S. and 517-645-6051 for participants located outside the U.S. The passcode is ISRG and the meeting leader is Mr. Lonnie Smith. To access financial information that will be discussed on the call, please visit Intuitive Surgical's website at www.intuitivesurgical.com.
About Intuitive's Products:
The da Vinci(r) Surgical System consists of a surgeon's viewing and control console having an integrated, high-performance InSite(r) 3-D vision system, a patient-side cart consisting of three or four robotic arms that position and precisely maneuver endoscopic instruments and an endoscope, and a variety of articulating EndoWrist(r) Instruments. By integrating computer-enhanced technology with surgeons' technical skills, Intuitive believes that its system enables surgeons to perform better surgery in a manner never before experienced. The da Vinci(r) Surgical System seamlessly and directly translates the surgeon's natural hand, wrist and finger movements on instrument controls at the surgeon's console outside the patient's body into corresponding micro-movements of the instrument tips positioned inside the patient through small puncture incisions, or ports.
The Aesop(r) Endoscope Positioner is a voice-activated robotic arm that automates the critical task of endoscope positioning, providing the surgeon with direct control over a smooth, precise and stable view of the internal surgical field.
The Hermes(r) Control Center is a centralized system designed to voice control a series of networked "smart" medical devices.
Intuitive(r), da Vinci(r), da Vinci(r) S, InSite(r), EndoWrist(r), Hermes(r), and Aesop(r) are trademarks or registered trademarks of Intuitive Surgical, Inc.
About non-GAAP Financial Measures:
To supplement our consolidated financial statements presented in accordance with GAAP, Intuitive has presented the following information defined as non-GAAP financial information by the SEC: non-GAAP (pro forma) statements of operations and EBITDA. The presentation of non-GAAP financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the tables captioned "Unaudited Reconciliation of GAAP to non-GAAP Consolidated Statements of Operations" and "Unaudited Consolidated Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) Reconciliation" included in this press release.
Intuitive's management believe that these non-GAAP financial measures provide meaningful supplemental information regarding the Company's performance and liquidity by excluding certain expenses that may not be indicative of core operating results. Intuitive believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing Intuitive's performance and when planning, forecasting and analyzing future periods.
Intuitive has computed its non-GAAP financial measures using the same consistent method from quarter to quarter. The accompanying tables have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are necessarily estimates reflecting the best judgment of our management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. These forward-looking statements should, therefore, be considered in light of various important factors, including the following: timing and success of product development and market acceptance of developed products; regulatory approvals, clearances and restrictions; guidelines and recommendations in the health care and patient communities; intellectual property positions and litigation; competition in the medical device industry and in the specific markets of surgery in which Intuitive Surgical operates; and unanticipated manufacturing disruptions; delays in regulatory approvals of new manufacturing facilities or the inability to meet demand for products. Words such as "estimate", "project", "plan", "intend", "expect", "anticipate", "believe" and similar expressions are intended to identify forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. We undertake no obligation to publicly update or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.
INTUITIVE SURGICAL, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------- -------------------
-------- -------- -------- --------
Products $ 96,287 $ 61,919 $317,599 $192,417
Services 16,280 10,176 55,083 34,921
-------- -------- -------- --------
Total revenue 112,567 72,095 372,682 227,338
Products 29,161 18,785 97,615 58,357
Services 8,461 4,748 27,231 15,412
-------- -------- -------- --------
Total cost of revenue 37,622 23,533 124,846 73,769
Gross profit 74,945 48,562 247,836 153,569
Selling, general and
administrative 31,050 20,784 110,703 67,443
Research and development 8,448 4,268 29,778 17,354
-------- -------- -------- --------
Total operating costs
and expenses 39,498 25,052 140,481 84,797
Income from operations 35,447 23,510 107,355 68,772
income, net 4,181 1,928 12,783 5,035
-------- -------- -------- --------
Income before income taxes 39,628 25,438 120,138 73,807
(benefit) 15,987 (24,087)* 48,094 (20,327)*
-------- -------- -------- --------
Net income $ 23,641 $ 49,525 $ 72,044 $ 94,134
======== ======== ======== ========
Net income per common
Basic $ 0.64 $ 1.38 $ 1.96 $ 2.68
======== ======== ======== ========
Diluted $ 0.62 $ 1.31 $ 1.89 $ 2.51
======== ======== ======== ========
Shares used in computing
basic and diluted net
income per common share:
Basic 37,009 35,819 36,737 35,070
======== ======== ======== ========
Diluted 38,241 37,675 38,093 37,488
======== ======== ======== ========
* Includes a one-time deferred tax benefit of $22.2 million
related to the reversal of the tax asset valuation allowances.
INTUITIVE SURGICAL, INC.
UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP CONSOLIDATED
STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Three months ended December 31,
------------------------------------------
------------------------------ --------
GAAP Impact Forma Reported
-------- -------- -------- --------
Products $ 96,287 $ -- $ 96,287 $ 61,919
Services 16,280 -- 16,280 10,176
-------- -------- -------- --------
Total revenue 112,567 -- 112,567 72,095
Products 29,161 (629) 28,532 18,785
Services 8,461 (399) 8,062 4,748
-------- -------- -------- --------
Total cost of revenue 37,622 (1,028) 36,594 23,533
-------- -------- -------- --------
Gross profit 74,945 1,028 75,973 48,562
% total revenue 66.6% 0.9% 67.5% 67.4%
and administrative 31,050 (4,315) 26,735 20,784
Research and development 8,448 (1,441) 7,007 4,268
-------- -------- -------- --------
Total operating costs
and expenses 39,498 (5,756) 33,742 25,052