Full Press Release Details
City, Utah - In the second calendar quarter (2Q) of 2007, Utah Medical
Products, Inc.'s (Nasdaq: UTMD) changes in financial results compared to the
same time period in the prior calendar year were as follows:
| 2Q (April - June) | 1H (January - June) | |||
| Sales: | (1%) | - | ||
| Gross Profit: | (2%) | (2%) | ||
| Operating Income: | +5 % | +3 % | ||
| Net Income: | (4%) | (4%) | ||
| Earnings Per Share: | (2%) | (3%) |
2007 and 1H 2007, UTMD achieved the following profit margins:
| 2Q 2007 (April - June) | 1H 2007 (January - June) | |||
| Gross Profit Margin (gross profits/ sales): | 55.5% | 55.4% | ||
| Operating Profit Margin (operating profits/ sales): | 37.7% | 37.7% | ||
| Net Profit Margin (profit after taxes/ sales): | 27.5% | 27.4% |
2Q 2007 sales to 2Q 2006 sales in product categories, neonatal product sales
were up 2%, obstetrics product sales were down 13%, gynecology/ electrosurgery
product sales were about the same and blood pressure monitoring/ components
sales were up 12%. Domestic sales in 2Q 2007 were down 5%, while
international sales were up 8% compared to 2Q 2006. Trade shipments
from Ireland were up 13% in EURO terms, but up 21% in US Dollar terms because
a weaker U.S. dollar.
direct sales excluding obstetrics products were about the same in 2Q 2007 as
2Q 2006. The domestic obstetrics product sales, which products are
sold to hospitals, were down substantially as a result of loss of market share
due to significant price reductions offered by competitors in 2007, and the
continued trend of administrative arrangements limiting physician choice of
devices used in L&D. The UTMD antidote is the continued
development of unique products that provide significant improvements in patient
safety and effectiveness of care.
regard, during 2Q 2007 UTMD introduced the Nutri-Lok
feeding-only extension sets that mate with, and enhance the safety of, UTMD's
popular Nutri-Cath silicone neonatal intensive care long-term feeding
catheters. The important enhancement of patient safety is
accomplished by eliminating the possibility of an inadvertent misconnection
an IV infusion line. The proprietary locking mechanism also ensures a secure
connection that will not accidentally slip apart, as is common with standard
slip fit connections to feeding syringes.
addition, in 2Q UTMD received FDA 510(k) regulatory concurrence to market its
saline/contrast media infusion catheter which is designed to improve the
detection and timely treatment of uterine disease. This product will augment
UTMD's first-line diagnostic device, the EndoCurette , which provides a
minimally-invasive, physician in-office biopsy for possible evaluation of
abnormal uterine bleeding. When biopsy results are inconclusive,
physicians are increasingly performing ultrasound or radiographic imaging of
endometrium as a next step. TVUS/HSG-Cath is a reliable and convenient means
deliver saline or contrast media needed in those growing number of
more than a year of submissions and Japan Ministry of Health review of
information, UTMD has achieved Japan certification of its manufacturing
facilities in both Utah and Ireland, as well as premarketing regulatory approval
for a number of its products. UTMD's new distributor, Solution/Best Aid
Corporation, expects completion of premarketing approvals under Japan's new more
stringent regulatory approvals process for most of UTMD's products in the near
future. Solution placed its first substantial order for OB/Gyn
products in July. UTMD believes that Japan's advanced health care system has the
potential to generate sales of about 25% of the sales volume that UTMD presently
enjoys from its specialty products in the U.S.
gross profit margin in 2Q 2007 was 55.5% compared to 55.9% in 2Q 2006, primarily
because the current quarter's sales mix was more weighted toward international
shipments at lower than average prices. Even with slightly lower sales and
profit margin, 2Q 2007 operating profit grew because operating expenses declined
by $193,000 to 17.9% of sales, compared to 20.3% of sales in 2Q
2006. Operating expenses are comprised of sales & marketing
(S&M), new product development (R&D) and general and administrative
(G&A) expenses. Compared to the prior year, 2Q 2007 S&M, R&D and
G&A expenses were down $76,000, $106,000 and $12,000,
respectively. In 2Q 2006, UTMD had written-off a one time charge to
R&D of $130,000 of intellectual property rights, which were recouped in 3Q
though operating profits were up, net income was down because in 2Q 2007, UTMD
did not have the one-time capital gains from investments received in 2Q 2006.
UTMD's excess cash is now invested in short term money market instruments,
currently yielding about 5.1%.
the most recent 4 calendar quarters were $1.99, compared to $1.91 at the same
ratios as of June 30, 2007 which may be of interest to shareholders
from unexercised option shares added to actual weighted average outstanding
shares for purposes of calculating eps was 59,600 in 2Q 2007 compared to 96,300
in 2Q 2006, and 66,100 in 1H 2007 compared to 106,200 in 1H 2006. The
actual number of outstanding shares at the end of 2Q 2007 was 3,924,000 which
included 2Q option exercises of 1,700 shares and 2Q share repurchases of
23,800. The average price paid by the Company to repurchase shares in
the open market during 2Q 2007 was $30.50 including commissions. Year-to-date
purchases through 1H 2007 have been 40,700 shares at an average per share cost
of $31.20. The total number of outstanding unexercised employee and outside
director options at June 30, 2007 was 223,100 shares at an average exercise
price of $21.49/ share, including shares awarded but not vested. This compares
to 286,300 unexercised option shares outstanding at the end of 2Q
are cautioned that this press release may contain forward looking statements,
and that actual results or events may differ from those
projected. Risk factors that could cause results to differ materially
from those projected include clinical acceptance of products, access to the
hospital marketplace that may become restricted at any time by administrative
Group Purchasing Organization agreements, timing of regulatory approval of
products, regulatory intervention in current operations, the Company's ability
to efficiently manufacture, market, and sell its products, among other factors
that have been outlined in UTMD=s
disclosure filings with the SEC. The SEC Form 10-Q for 2Q 2007 will
be filed with the SEC by August 9.
Medical Products, Inc., with particular interest in health care for women and
their babies, develops, manufactures, assembles and markets a broad range of
disposable and reusable specialty medical devices designed for better health
outcomes for patients and their care-providers. For more information
about Utah Medical Products, Inc., visit UTMD=s
Medical Products, Inc.
STATEMENT, Second Quarter (3 months ended June 30)
thousands except earnings per share):
| 2Q 2007 | 2Q 2006 | Percent Change | ||||||||||
| Net Sales | $ | 7,211 | $ | 7,293 | (1.1% | ) | ||||||
| Gross Profit | 4,005 | 4,077 | (1.7% | ) | ||||||||
| Operating Income | 2,717 | 2,595 | +4.7% | |||||||||
| Income Before Tax | 3,031 | 3,166 | (4.3% | ) | ||||||||
| Net Income | 1,985 | 2,059 | (3.6% | ) | ||||||||
| Earnings Per Share | $ | 0.497 | $ | 0.509 | (2.4% | ) | ||||||
| Shares Outstanding (diluted) | 3,995 | 4,043 |
STATEMENT, First Half (6 months ended June 30)
thousands except earnings per share):
| 1H 2007 | 1H 2006 | Percent Change | ||||||||||
| Net Sales | $ | 14,329 | $ | 14,396 | (0.5% | ) | ||||||
| Gross Profit | 7,942 | 8,084 | (1.8% | ) | ||||||||
| Operating Income | 5,408 | 5,227 | +3.5% | |||||||||
| Income Before Tax | 6,022 | 6,212 | (3.1% | ) | ||||||||
| Net Income | 3,929 | 4,094 | (4.0% | ) | ||||||||
| Earnings Per Share | $ | 0.981 | $ | 1.010 | (2.8% | ) | ||||||
| Shares Outstanding (diluted) | 4,004 | 4,056 |