EX-99.3 4 c87507exv99w3.txt EARNINGS PRESS RELEASE EXHIBIT 99.3 TLCVISION REPORTS FINANCIAL RESULTS FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2004 TORONTO, ONTARIO--(CCNMatthews - Aug. 9, 2004) - TLC Vision Corporation (NASDAQ:TLCV; TSX:TLC), North America's premier eye care services company, today announced its financial results for the three month and six month periods ended June 30, 2004. All dollar amounts are expressed in U.S. currency and results are reported in accordance with U.S. generally accepted accounting principles (U.S. GAAP) unless otherwise stated. Q2-04 total net revenues were $64.7 million, up 36% from $47.5 million in the second quarter of 2003. Second quarter total paid laser procedure volumes were over 51,600. Same-store year-over-year volume growth of 24% in the centers was partially offset by 9% year-over-year volume growth in the access business. The result was that Q2-04 total procedure volumes were up 16% from 44,500 for the same three month period a year ago. The procedure volume mix in Q2-04 was 59% centers versus 41% access. CustomLASIK procedures represented approximately 52% of center volumes in Q2-04. TLCVision reported a Q2-04 net profit of $6.2 million, or $0.09 per share, compared to a loss of ($3.5 million), or ($0.05) per share, reported in last year's second quarter. The Q2-04 net profit included restructuring, severance and other charges totaling $2.8 million, or $0.04 per share, primarily related to future severance payments associated with the planned retirements of B. Charles (Chuck) Bono III as Chief Financial Officer and Robert W. May as General Counsel. The effect of these charges was partially offset by a positive gain of $1.2 million, or $0.02 per share, due to the reversal of a reserve for long-term receivables. Editors should note that investment analyst estimates do not generally reflect the impact of one-time charges or gains. Excluding the aforementioned one-time adjustments, TLCVision's non-GAAP net profit was $7.8 million, or $0.11 per share. This was comparable with the $0.12 per share profit reported for the seasonally strong first quarter of 2004. Second quarter 2004 adjusted EBITDA was $13.1 million, up 272% from the $3.5 million reported for the same three month period last year. (Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization ("EBITDA") excluding certain non-recurring items and research and development costs and is used to assist in understanding and comparing operating results. EBITDA and Adjusted EBITDA, which are not calculated identically by all companies, are not substitutes for operating income, net income and cash flow as determined in accordance with generally accepted accounting principles. Management uses EBITDA and Adjusted EBITDA as key measures of operating performance. Reference should be made to the "Adjusted EBITDA" table that provides reconciliation between operating results as prescribed by U.S. GAAP and "Adjusted EBITDA".) For the six months ended June 30, 2004 paid laser procedure volumes were over 108,500 and total net revenues were $129.8 million. This compared to paid laser procedure volumes of 98,000 and total net revenues of $101.1 million for the comparable period of the prior year. The net profit for the six months ended June 30, 2004 was $14.3 million, or $0.20 per share, compared to a net loss of ($2.4 million), or ($0.04) per share, for the same period last year. Adjusted EBITDA for the six months ended June 30, 2004 was $26.4 million, up 149% from the Adjusted EBITDA of $10.6 million for the first half of 2003. Elias Vamvakas, TLCVision's Chairman, commented "I am very pleased with what we have accomplished thus far in 2004. Adjusted EBITDA for the first six months of 2004 alone has already exceeded that achieved for the entire 2003 year by 48%, or $8.6 million. Now into our third quarter, early indications are that year-over-year growth trends will continue. I remain confident that we will continue to build on TLCVision's world-leading position going forward." Conference Call TLCVision is pleased to invite all interested parties to participate in a conference call during which these results will be discussed. The call will be held today, August 9, at 4:30 p.m. Eastern Time at 1-800-731-2911. The call will also be broadcast live and archived on the company's web site at www.tlcv.com under the "Webcasts" link in the Investor Relations section. In addition, the live web cast will be available at various other popular portals and financial web sites. About TLC Vision TLCVision is North America's premier eye care services company. The key drivers of TLCVision's strategy are our affiliated network of thousands of eye doctors, proven corporate and consumer marketing and education programs, and access to state of the art clinical technologies. We are supported by a strong operations management culture and superior information technology. More information about the company can be found on the TLCVision web site at www.tlcv.com. Forward Looking Statements This press release contains certain forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934, which statements can be identified by the use of forward looking terminology, such as "may", "will", "expect", "intend", "anticipate", "estimate", "predict", "plans" or "continue" or the negative thereof or other variations thereon or comparable terminology referring to future events or results. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of numerous factors, including the timing of expenditures, effects of competition, changes to pricing, acquisitions and expansion opportunities, any of which could cause actual results to vary materially from current results or TLCVision's anticipated future results. See the Company's reports filed with the Canadian Securities Regulators and the U.S. Securities and Exchange Commission from time to time for cautionary statements identifying important factors with respect to such forward looking statements, including certain risks and uncertainties, that could cause actual results to differ materially from results referred to in forward looking statements. TLCVision assumes no obligation to update the information contained in this press release. TLC VISION CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (In thousands except per share amounts)
THREE MONTHS SIX MONTHS ENDED JUNE 30, ENDED JUNE 30, ------------------ ------------------ 2004 2003 2004 2003 ------- ------- ------- ------- Revenues Refractive Centers $36,374 $26,237 $75,212 $57,160 Access 10,544 9,647 22,593 20,576 Other healthcare services 17,743 11,648 32,031 23,386 ------- ------- ------- ------- Total revenues 64,661 47,532 129,836 101,122 ------- ------- ------- ------- Cost of revenues Refractive Centers 24,645 20,636 50,797 43,179 Access 7,135 6,481 15,307 13,643 Other healthcare services 10,574 7,950 19,712 15,430 ------- ------- ------- ------- Total cost of revenues 42,354 35,067 85,816 72,252 ------- ------- ------- ------- Gross margin 22,307 12,465 44,020 28,870 ------- ------- ------- ------- General and administrative 7,400 8,313 15,301 16,332 Marketing 3,435 3,496 6,329 7,157 Research and development 350 -- 724 -- Amortization of intangibles 1,057 1,678 2,069 3,350 Adjustment to the fair value of investments and long-term receivables (1,206) (651) (1,206) (448) Restructuring, severance and other charges 2,755 1,720 2,755 1,720 ------- ------- ------- ------- 13,791 14,556 25,972 28,111 ------- ------- ------- ------- Operating income (loss) 8,516 (2,091) 18,048 759 Other income (expense), net (22) 198 526 566 Interest expense, net (272) (393) (675) (761) Minority interests (2,454) (961) (4,328) (2,502) Earnings from equity investments 613 -- 1,012 -- ------- ------- ------- ------- Income (loss) before income taxes 6,381 (3,247) 14,583 (1,938) Income tax expense (142) (206) (292) (445) ------- ------- ------- ------- Net income (loss) $ 6,239 $(3,453) $14,291 $(2,383) ------- ------- ------- ------- Earnings (loss) per share - basic $ 0.09 $ (0.05) $ 0.21 $ (0.04) ======= ======= ======= ======= Earnings (loss) per share - diluted $ 0.09 $ (0.05) $ 0.20 $ (0.04) ======= ======= ======= ======= Weighted average number of common shares outstanding - basic 68,585 63,457 67,759 63,435 Weighted average number of common shares outstanding - diluted 71,249 63,457 70,341 63,435
TLC VISION CORPORATION RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA (In thousands except per share amounts) (unaudited)
3 months 3 months 6 months 6 months ended ended ended ended June 30 June 30 June 30 June 30 -------------------- -------------------- 2004 2003 2004 2004 -------- -------- -------- -------- Net income (loss) $ 6,239 $ (3,453) $ 14,291 $ (2,383) Interest 272 393 675 761 Taxes 142 206 292 445 Depreciation and amortization 4,461 5,493 9,018 11,047 -------- -------- -------- -------- EBITDA 11,114 2,639 24,276 9,870 -------- -------- -------- -------- Research and development 350 - 724 - Variable stock option expense 15 - 334 - Restructuring, severance and other charges 2,755 1,720 2,755 1,720 Adjustment to the fair value of investments and long-term receivables, net (1,206) (651) (1,206) (448) Other income, net 22 (198) (526) (566) -------- -------- -------- -------- Adjusted EBITDA $ 13,050 $ 3,510 $ 26,357 $ 10,576 ======== ======== ======== ========
TLC VISION CORPORATION CONSOLIDATED BALANCE SHEETS (In thousands)
(UNAUDITED) JUNE 30, DECEMBER 31, 2004 2003 --------- ------------ ASSETS Current assets Cash and cash equivalents $ 47,952 $ 29,580 Short-term investments 313 748 Accounts receivable 17,721 15,617 Prepaids and other current assets 12,753 11,646 --------- ------------ Total current assets 78,739 57,591 Restricted cash 1,352 1,376 Investments and other assets 7,858 3,102 Intangibles, net 20,327 22,959 Goodwill, net 53,088 48,829 Fixed assets, net 50,780 56,891 --------- ------------ Total assets $ 212,144 $ 190,748 ========= ============ LIABILITIES Current liabilities Accounts payable $ 7,669 $ 10,627 Accrued liabilities 25,678 25,811 Current portion of long-term debt 10,058 10,285 --------- ------------ Total current liabilities 43,405 46,723 Other long-term liabilities 2,493 2,607 Long-term debt, less current maturities 12,341 19,242 Minority interests 9,751 10,907 SHAREHOLDERS' EQUITY Capital stock 419,738 397,878 Option and warrant equity 4,877 8,143 Accumulated deficit (280,461) (294,752) --------- ------------ Total shareholders' equity 144,154 111,269 --------- ------------ Total liabilities and shareholders' equity $ 212,144 $ 190,748 ========= ============
-30- Stephen Kilmer VP, Investor Relations TLC Vision Corporation (NASDAQ:TLCV; TSX:TLC) (905) 238-3904