Full Press Release Details
SOUTH JORDAN, Utah, Feb. 5, 2009 (GLOBE NEWSWIRE) -- Merit Medical Systems, Inc. (Nasdaq:MMSI), a manufacturer and marketer of proprietary disposable devices used primarily in cardiology and radiology procedures, today announced record revenues of $227.1 million for the year ended December 31, 2008, an increase of 9% over revenues of $207.8 million for the year ended December 31, 2007.
Earnings for the year ended December 31, 2008 were a record $20.7 million, up 33% compared to $15.6 million for the year ended December 31, 2007. Earnings per share for the year 2008 were $0.73, up from $0.55 per share for the year 2007.
Gross margins improved to 41.1% of sales for the year ended December 31, 2008, compared to 38.4% of sales for the year ended December 31, 2007, an improvement of 270 basis points.
"Merit's performance for 2008 exceeded our original estimates for the year and are a reflection of the efforts of many employees during a difficult economic environment," said Fred P. Lampropoulos, Merit's Chairman and Chief Executive Officer. "The volatile prices of commodities we have experienced during the past year were overcome by our focus on efficiency, new product introductions and productivity."
Revenues for the quarter ended December 31, 2008 were $58.0 million, compared with revenues of $54.3 million for the quarter ended December 31, 2007, an increase of 7%.
Earnings for the quarter ended December 31, 2008 were $5.4 million, up 14% compared to $4.7 million for the quarter ended December 31, 2007. Earnings per share for the fourth quarter of 2008 were $0.19, up from $0.17 per share for the fourth quarter of 2007. Earnings for the fourth quarter of 2008 were negatively impacted by an increase in income tax expense of $356,000 for losses in life insurance investments related to Merit's deferred compensation plan which are not deductible for income tax reporting purposes.
Gross margins for the fourth quarter of 2008 were 40.5% of sales, up from 39.8% of sales for the fourth quarter of 2007.
Sales in each of Merit's product categories grew for the year ended December 31, 2008, compared to the year ended December 31, 2007, as catheter sales rose 20%; custom kit and tray sales rose 11%; stand-alone device sales increased 9%; and inflation device sales grew 4%.
For the fourth quarter of 2008, compared to the fourth quarter of 2007, catheter sales rose 23%; custom kit and tray sales grew 15%; stand-alone device sales increased 4%; and inflation device sales decreased 4%.
Sales during the fourth quarter of 2008 were affected by deliveries of inflation devices to an OEM customer, foreign exchange rates, and the recovery process of Merit's facility in Angleton, Texas, which was damaged by Hurricane Ike.
Selling, general and administrative expenses were 22.2% and 23.4% of sales for the fourth quarter and year ended December 31, 2008, respectively, compared with 23.1% and 23.2% of sales for the comparable periods of 2007, respectively.
Research and development costs were 4.1% and 4.0% of sales for the fourth quarter and year ended December 31, 2008, respectively, compared to 3.9% and 4.2% of sales for the comparable periods of 2007, respectively.
Merit's effective tax rates for the fourth quarter and calendar year 2008 were 36.9% and 34.9%, respectively, compared to 33.5% and 33.4% for the same periods of 2007, respectively.
Merit earned $28.3 million in cash from operations for the year ended December 31, 2008, compared to $32.1 million for the year ended December 31, 2007. Merit's cash position increased to $34.3 million on December 31, 2008, compared to $17.6 million on December 31, 2007.
During the quarter ended December 31, 2008, Merit received 510(k) clearance from the Food and Drug Administration for its new Maestro(tm) microcatheters, and the Miser(tm), a newly designed contrast management system.
The financial information presented in this release has not been audited and is subject to adjustment as Merit completes the procedures associated with the audit of its financial statements for the year ended December 31, 2008. Merit does not anticipate those adjustments, if any, to be material.
(Unaudited, in thousands except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
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SALES $ 57,996 $ 54,343 $ 227,143 $ 207,768
COST OF SALES 34,503 32,729 133,872 127,977
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GROSS PROFIT 23,493 21,614 93,271 79,791
Selling, general and
administrative 12,887 12,553 53,127 48,133
development 2,404 2,127 9,160 8,688
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Total 15,291 14,680 62,287 56,821
INCOME FROM OPERATIONS 8,202 6,934 30,984 22,970
Interest income 286 145 781 393
Other income 55 34 80 36
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income - net 341 179 861 429
INCOME BEFORE INCOME
TAX EXPENSE 8,543 7,113 31,845 23,399
INCOME TAX EXPENSE 3,151 2,385 11,118 7,811
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NET INCOME $ 5,392 $ 4,728 $ 20,727 $ 15,588
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Basic $ 0.19 $ 0.17 $ 0.75 $ 0.57
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Diluted $ 0.19 $ 0.17 $ 0.73 $ 0.55
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AVERAGE COMMON SHARES-
Basic 28,069,589 27,340,755 27,769,479 27,424,686
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Diluted 28,750,369 28,037,986 28,549,825 28,204,235
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(Unaudited in thousands)
December 31, December 31,
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Cash and cash equivalents $ 34,304 $ 17,574
Trade receivables, net 27,749 26,619
Employee receivables 126 144
Other receivables 818 1,140
Inventories 38,358 34,106
Prepaid expenses and other assets 985 1,297
Deferred income tax assets 2,782 811
Income tax refunds receivable 607 297
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Total Current Assets 105,729 81,988
Property and equipment, net 103,939 99,696
Other intangibles, net 6,963 6,163
Goodwill 12,998 9,527
Other assets 2,051 2,964
Deferred income tax assets 23 4
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Total Assets $ 231,776 $ 200,420
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LIABILITIES AND STOCKHOLDERS' EQUITY
Trade payables 10,622 10,275
Accrued expenses 9,973 9,492
Advances from employees 366 267
Liabilities related to unrecognized tax
Income taxes payable 211 737
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Total Current Liabilities 21,172 21,794
Deferred income tax liabilities 8,771 6,082
Liabilities related to unrecognized tax
positions 2,818 2,588
Deferred compensation payable 2,348 3,063
Deferred credits 1,994 2,105
Other long-term obligations 368 420
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Total Liabilities 37,471 36,052
Stockholders' Equity
Common stock 61,689 52,477
Retained earnings 132,674 111,947
Accumulated other comprehensive loss (58) (56)
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Total stockholders' equity 194,305 164,368
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Total Liabilities and Stockholders' Equity $ 231,776 $ 200,420
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Merit invites all interested parties to participate in its fourth quarter and year-end conference call today, February 5, 2009, at 5:00 p.m. Eastern (4:00 p.m. Central, 3:00 p.m. Mountain, and 2:00 p.m. Pacific). The domestic phone number is 800-366-7449, and the international number is 303-262-2140. A live webcast as well as a rebroadcast can be accessed through the Investors page at www.merit.com or through the webcasts tab at www.fulldisclosure.com.
Founded in 1987, Merit Medical Systems, Inc. is engaged in the development, manufacture and distribution of proprietary disposable medical devices used in interventional and diagnostic procedures, particularly in cardiology and radiology. Merit serves client hospitals worldwide with a domestic and international sales force totaling approximately 100 individuals. Merit employs approximately 1,650 people worldwide, with facilities in Salt Lake City and South Jordan, Utah; Angleton, Texas; Richmond, Virginia; Maastricht and Venlo, The Netherlands; and Galway, Ireland.
The Merit Medical Systems, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3282
Statements contained in this release, which are not purely historical, are forward-looking statements within the meaning of the Private Securities Litigation Act of 1995 and are subject to risks and uncertainties such as those described in Merit's Annual Report on Form 10-K for the year ended December 31, 2007. Such risks and uncertainties include infringement of Merit's technology or the assertion that Merit's technology infringes the rights of other parties; product recalls and product liability claims; downturn of the national economy and its affect on Merit's revenues, collections and supplier relations; termination of supplier relationships, or failure of suppliers to perform; inability to successfully manage growth through acquisitions; delays in obtaining regulatory approvals, or the failure to maintain such approvals; concentration of Merit's revenues among a few products and procedures; development of new products and technology that could render Merit's products obsolete; market acceptance of new products; introduction of products in a timely fashion; price and product competition; availability of labor and materials; cost increases; and fluctuations in and obsolescence of inventory; volatility of the market price of Merit's common stock; foreign currency fluctuations; changes in key personnel; work stoppage or transportation risks; modification or limitation of governmental or private insurance reimbursement; changes in health care markets related to health care reform initiatives; and other factors referred to in Merit's Annual Report on Form 10-K for the year ended December 31, 2007, and other reports filed with the Securities and Exchange Commission. All subsequent forward-looking statements attributable to Merit or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Actual results will differ, and may differ materially, from anticipated results. Financial estimates are subject to change and are not intended to be relied upon as predictions of future operating results, and Merit assumes no obligation to update or disclose revisions to those estimates.