EX-99.1 2 ad20167572-ex99_1.htm PRESS RELEASE ad20167572-ex99_1.htm
 
Exhibit 99.1
 
FOR IMMEDIATE RELEASE

Company Contact:
Investor Relations Contacts:
Media Contact:
AngioDynamics, Inc.
D. Joseph Gersuk, CFO
(800) 772-6446 x1608
jgersuk@AngioDynamics.com
EVC Group, Inc.
Doug Sherk / Jenifer Kirtland
(415) 896-6820
dsherk@evcgroup.com
jkirtland@evcgroup.com
EVC Group, Inc.
Chris Gale
(646) 201-5431
cgale@evcgroup.com
 

 
AngioDynamics Reports Strong Finish to Fiscal 2010

·  
Fourth Quarter Net Sales Increase 14% to $60.3 Million
·  
First $1.0 Million NanoKnife® IRE System Net Sales Quarter
·  
Record $16.1 Million Operating Cash Flow Quarter
·  
Fourth Quarter Net Income Grows 29%
·  
Company Provides Guidance for FY 2011
·  
Conference Call Begins Today at 4:30 p.m. Eastern Time

 
ALBANY, NY (July 15, 2010) — AngioDynamics (NASDAQ: ANGO), a leading provider of innovative medical devices for the minimally-invasive treatment of cancer and peripheral vascular disease, today reported financial results for the fiscal fourth quarter and year ended May 31, 2010.

Net sales in the fourth quarter were $60.3 million, a 14% increase over the $52.8 million reported for the fourth quarter last year.  Gross margin was 58.0% compared with 61.9% a year ago, with the decline primarily attributable to lower selling prices for certain Peripheral Vascular and Access products in a competitive pricing environment, higher material costs for certain products, and product mix.  Operating income was $6.4 million in the quarter compared with $4.8 million a year ago, which included $702,000 in certain non-recurring costs.  Operating income grew 17% excluding non-recurring items.  Net income was $3.7 million, or $0.15 per share, compared with the prior year’s $2.9 million, or $0.12 per share, and $3.4 million, or $0.14 per share excluding non-recurring items.

Oncology/Surgery sales grew 35% to $16.8 million from the fourth quarter a year ago and included $1.0 million in NanoKnife IRE System sales.  Fiscal 2010 NanoKnife IRE System sales totaled $2.5 million.  Peripheral Vascular sales increased by 13% from the fourth quarter a year ago to $25.5 million.  Access sales were $18.0 million in the quarter, an increase of 1% from a year ago.

AngioDynamics generated cash flow from operations of $16.1 million in the fourth quarter and $40.0 million in the fiscal year.  The Company ended fiscal 2010 with $100.1 million in cash and investments, and $6.8 million in long-term debt.

For the fiscal year, net sales were $216.0 million, an 11% increase over the $195.1 million reported in fiscal 2009; gross margin was 58.8% compared with 61.6% for the prior year; operating income was $20.9 million compared with $16.1 million for the prior year, which included $3.7 million in certain non-recurring costs; and net income was $12.3 million, or $0.50 per share, compared with the prior year’s $9.9 million, or $0.41 per share, and $12.4 million, or $0.51 per share, excluding non-recurring items.

“There is much to like about our fourth quarter,” said Jan Keltjens, President and CEO. “With the significant increase in Oncology/Surgery sales, rising NanoKnife IRE System sales and growing demand for our Varicose Vein products, we achieved our highest level of organic sales growth in eight quarters and ended our fiscal year in a very strong position.  We met the challenge of the difficult pricing environment that continues to pressure our gross margin with tight operating expense control and excellent balance sheet management.  As a result, we delivered strong operating profit growth and record operating cash flow.

“We launched 11 new products in fiscal 2010 and we enter fiscal 2011 with several recently-introduced products that we believe will increase sales growth in our Access products,” continued Mr. Keltjens.  “While we expect the pricing environment to remain challenging, due to our focus on high growth markets, innovation and operating leverage, AngioDynamics is well positioned for profitable growth in the years ahead.”

Highlights of the quarter, and more recent activities, include the following:

·  
Continued strong clinical interest in AngioDynamics’ NanoKnife IRE System resulted in the treatment of an additional 76 patients since March 31 2010. The number of patients treated to date with the NanoKnife system now totals 230.  Procedures have been performed in many organs, including prostate, liver, lung, and pancreas.

·  
Four hospitals entered into a commercial agreement for the NanoKnife IRE System during the fourth quarter, including the first center outside the U.S.

·  
The first patient treatment was completed in the pilot study of the use of the Company’s NanoKnife IRE System in the treatment of early stage hepatocellular carcinoma (HCC), or primary liver cancer.  This clinical trial is being conducted under the supervision of Dr. Jordi Bruix of the Barcelona Liver Cancer Group of the University of Barcelona and Dr. Riccardo Lencioni of the University of Pisa School of Medicine.  Updates on the status of the study, titled “A Prospective, Multi-Center, Clinical Trial Using Irreversible Electroporation (IRE) for the Treatment of Early-Stage Hepatocellular Carcinoma (HCC),” can be found at www.clinicaltrials.gov.
 
·  
An article, “Irreversible Electroporation: A New Challenge in ‘Out of Operating Theater’ Anesthesia,” authored by Christine Ball, MBBS; Kenneth R. Thomson, MD; and Helen Kavnoudias, PhD, was published in Anesthesia & Analgesia, May 2010, Volume 110, Number 5.

·  
The new Morpheus® Smart PICC Triple Lumen CT PICC was introduced.  The product features Smart Taper™ technology, allowing the catheter to quickly taper from a seven French diameter to a precise six French diameter, improving blood flow and reducing the risk of thrombosis.

·  
The Company expanded its Smart Port CT family of power-injectable ports, featuring its patented Vortex® port technology, to include low-profile and mini models for repeated treatments such as chemotherapy and for use with computed tomography (CT). The new models offer additional placement options for specialized anatomies, such as smaller patients.

Fiscal 2011 Guidance

The Company’s outlook for fiscal 2011 is as follows:

·  
Net sales in the range of $230 million to $235 million, an increase of 6% to 9% over fiscal 2010 net sales
 
·  
Gross margin in the range of 58% to 59% of net sales
 
·  
GAAP operating income in the range of $22.5 million to $23.5 million, an increase of 8% to 13%
 
·  
EBITDA in the range of $35 million to $36 million
 
·  
GAAP EPS in the range of $0.53 to $0.56, an increase of 6% to 12%, inclusive of a $0.23 EPS impact from the IRE program
 
Conference Call
 
AngioDynamics management will host a conference call to discuss its fiscal fourth quarter results today beginning at 4:30 p.m. Eastern Time. To participate in the live call by telephone, please dial 1 (877) 941-2332.

In addition, individuals can listen to the call on the Internet by visiting the investor relations portion of the AngioDynamics Web site at http://investors.angiodynamics.com. To listen to the live call, please go to the Web site 15 minutes prior to its start to register, download and install the necessary audio software.  In addition, a replay of the call will be available at http://investors.angiodynamics.com.

Use of Non-GAAP Measures

Management uses non-GAAP measures to establish operational goals, and believes that non-GAAP measures may assist investors in analyzing the underlying trends in AngioDynamics’ business over time. Investors should consider these non-GAAP measures in addition to, not as a substitute for or as superior to, financial reporting measures prepared in accordance with GAAP. In this news release, AngioDynamics has reported non-GAAP EBITDA (income before interest, taxes, depreciation and amortization). Management uses this measure in its internal analysis and review of operational performance. Management believes that this measure provides investors with useful information in comparing AngioDynamics’ performance over different periods. By using this non-GAAP measure, management believes that investors get a better picture of the performance of AngioDynamics’ underlying business. Management encourages investors to review AngioDynamics’ financial results prepared in accordance with GAAP to understand AngioDynamics’ performance taking into account all relevant factors, including those that may only occur from time to time but have a material impact on AngioDynamics’ financial results. Please see the tables that follow for a reconciliation of Operating Income to non-GAAP measures.

About AngioDynamics

AngioDynamics, Inc. is a leading provider of innovative medical devices used by interventional radiologists, surgeons and other physicians for the minimally-invasive treatment of cancer and peripheral vascular disease.  AngioDynamics’ diverse product lines include market-leading radiofrequency and irreversible electroporation ablation systems, vascular access products, angiographic products and accessories, dialysis products, angioplasty products, drainage products, thrombolytic products, embolization products and venous products. More information is available at www.angiodynamics.com.

Safe Harbor

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements regarding AngioDynamics’ expected future financial position, results of operations, cash flows, business strategy, budgets, projected costs, capital expenditures, products, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include the words such as “expects,” “reaffirms” “intends,” “anticipates,” “plans,” “believes,” “seeks,” “estimates,” or variations of such words and similar expressions, are forward-looking statements. These forward looking statements are not guarantees of future performance and are subject to risks and uncertainties. Investors are cautioned that actual events or results may differ from AngioDynamics’ expectations. Factors that may affect the actual results achieved by AngioDynamics include, without limitation, the ability of AngioDynamics to develop its existing and new products, future actions by the FDA or other regulatory agencies, results of pending or future clinical trials, overall economic conditions, the results of on-going litigation, general market conditions, market acceptance, foreign currency exchange rate fluctuations, the effects on pricing from group purchasing organizations and competition, the ability of AngioDynamics to integrate purchased businesses, as well as the risk factors listed from time to time in AngioDynamics’ SEC filings, including but not limited to its Annual Report on Form 10-K for the year ended May 31, 2009. AngioDynamics does not assume any obligation to publicly update or revise any forward-looking statements for any reason.

In the United States, NanoKnife has been cleared by the FDA for use in the surgical ablation of soft tissue. This document may discuss the use of NanoKnife for specific clinical indications for which it is not cleared in the United States at this time.
 

 
 

 
 
 
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(in thousands, except per share data)
 

     
Three months ended
   
Twelve months ended
 
     
May 31,
   
May 31,
   
May 31,
   
May 31,
 
     
2010
   
2009
   
2010
   
2009
 
     
(unaudited)
   
(unaudited)
      (2)  
                             
Net sales
    $ 60,277     $ 52,820     $ 216,035     $ 195,054  
Cost of sales
    25,320       20,127       89,066       74,989  
 
Gross profit
    34,957       32,693       126,969       120,065  
 
% of net sales
    58.0 %     61.9 %     58.8 %     61.6 %
                                   
Operating expenses
                               
   Research and development
    5,374       4,835       19,275       17,914  
   Sales and marketing
    16,491       16,281       60,923       57,797  
   General and administrative
    4,254       3,803       16,437       15,381  
   Non-recurring costs
    -       702       -       3,743  
   Amortization of intangibles
    2,456       2,310       9,463       9,126  
 
Total operating expenses
    28,575       27,931       106,098       103,961  
 
Operating income
    6,382       4,762       20,871       16,104  
Other income (expense), net
    (563 )     (294 )     (1,252 )     (952 )
 
Income before income taxes
    5,819       4,468       19,619       15,152  
Provision for income taxes
    2,081       1,566       7,307       5,220  
 
Net income
  $ 3,738     $ 2,902     $ 12,312     $ 9,932  
                                   
Earnings per common share
                               
 
Basic
  $ 0.15     $ 0.12     $ 0.50     $ 0.41  
 
Diluted
  $ 0.15     $ 0.12     $ 0.50     $ 0.41  
                                   
Weighted average common shares
                               
 
Basic
    24,743       24,427       24,580       24,363  
 
Diluted
    24,969       24,544       24,787       24,513  
                                   
                                   
                                   
                                   
(2)
Derived from audited financial statements
                               

 
 

 
 
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(in thousands, except per share data)
 

Reconciliation of Operating Income to non-GAAP EBITDA:
                       
                           
                           
                           
     
Three months ended
   
Twelve months ended
 
     
May 31,
   
May 31,
   
May 31,
   
May 31,
 
     
2010
   
2009
   
2010
   
2009
 
     
(unaudited)
   
(unaudited)
 
                           
Operating income
  $ 6,382     $ 4,762     $ 20,871     $ 16,104  
                                   
Amortization of intangibles
    2,456       2,310       9,463       9,126  
Depreciation
      747       689       2,996       2,687  
 
EBITDA
  $ 9,585     $ 7,761     $ 33,330     $ 27,917  
                                   
EBITDA per common share
                               
 
Basic
  $ 0.39     $ 0.32     $ 1.36     $ 1.15  
 
Diluted
  $ 0.38     $ 0.32     $ 1.34     $ 1.14  
                                   
Weighted average common shares
                               
 
Basic
    24,743       24,427       24,580       24,363  
 
Diluted
    24,969       24,544       24,787       24,513  
                                   
                                   

 
 

 
 
ANGIODYNAMICS, INC. AND SUBSIDIARIES
NET SALES BY BUSINESS UNIT AND BY GEOGRAPHY
(in thousands)

 
     
Three months ended
   
Twelve months ended
 
     
May 31,
   
May 31,
   
May 31,
   
May 31,
 
     
2010
   
2009
   
2010
   
2009
 
     
(unaudited)
   
(unaudited)
      (2)  
                             
Net Sales by Business Unit
                         
 
Peripheral Vascular
  $ 25,524     $ 22,510     $ 92,163     $ 83,457  
 
Access
    17,994       17,881       66,988       66,812  
 
Oncology/Surgery
    16,759       12,429       56,884       44,785  
 
Total
  $ 60,277     $ 52,820     $ 216,035     $ 195,054  
                                   
                                   
                                   
                                   
Net Sales by Geography
                               
 
United States
  $ 54,152     $ 47,144     $ 192,933     $ 173,406  
 
International
    6,125       5,676       23,102       21,648  
 
Total
  $ 60,277     $ 52,820     $ 216,035     $ 195,054  
                                   
                                   
                                   
                                   
                                   
(2)
Derived from audited financial statements
                               
 
 
 
 

 
 
 

ANGIODYNAMICS, INC. AND SUBSIDIARIES
 
CONSOLIDATED BALANCE SHEETS
 
(in thousands)
 
               
               
     
May 31,
   
May 31,
 
     
2010
   
2009
 
     
(unaudited)
     (2)  
Assets
               
Current Assets
             
 
Cash and cash equivalents
  $ 58,763     $ 27,909  
 
Marketable securities
    41,311       40,278  
 
      Total cash and investments
    100,074       68,187  
                   
 
Receivables, net
    29,838       27,181  
 
Inventories, net
    29,216       36,928  
 
Deferred income taxes
    5,281       9,337  
 
Prepaid income taxes
    5,525       3,694  
 
Prepaid expenses and other
    1,426       3,271  
 
      Total current assets
    171,360       148,598  
                   
Property, plant and equipment, net
    24,193       22,183  
Intangible assets, net
    58,352       67,770  
Goodwill
    161,974       161,974  
Deferred income taxes
    2,527       4,263  
Other non-current assets
    5,519       3,915  
 
      Total Assets
  $ 423,925     $ 408,703  
                   
Liabilities and Stockholders' Equity
               
Current portion of long-term debt
  $ 260     $ 265  
Contractual payments on acquisition of business, net
    -       5,227  
Other current liabilities
    25,766       24,207  
Long-term debt, net of current portion
    6,550       6,810  
 
      Total Liabilities
    32,576       36,509  
                   
Stockholders' equity
    391,349       372,194  
 
      Total Liabilities and Stockholders' Equity
  $ 423,925     $ 408,703  
                   
Shares outstanding
    24,747       24,428  
                   
                   
                   
(2)
Derived from audited financial statements
               

 
 

 


ANGIODYNAMICS, INC. AND SUBSIDIARIES
 
CONSOLIDATED STATEMENTS OF CASH FLOWS
 
(in thousands)
 
                         
                         
         
Twelve months ended
 
         
May 31,
         
May 31,
 
         
2010
         
2009
 
         
(unaudited)
           (2)  
                           
Cash flows from operating activities:
                   
  Net income   $ 12,312             $ 9,932  
  Depreciation and amortization     12,459               11,813  
  Tax effect of exercise of stock options   (529 )             (149 )
  Deferred income taxes     5,877               4,267  
  Stock-based compensation     4,876               5,793  
  Other     (940 )             1,611  
  Changes in operating assets and liabilities                      
   
 Receivables
    (2,613 )             351  
   
 Inventories
    8,302               (10,532 )
   
 Accounts payable and accrued liabilities
    1,522               5,566  
   
 Litigation provision
    -               (6,757 )
   
 Other
      (1,307 )             (1,953 )
     
 Net cash provided by operating activities
    39,959               19,942  
                               
Cash flows from investing activities:
                       
  Additions to property, plant and equipment     (5,042 )             (4,361 )
  Acquisition of intangible assets and businesses     (5,411 )             (17,078 )
  Change in restricted cash     -               68  
  Purchases, sales and maturities of marketable securities, net     (1,324 )             5,672  
     
 Net cash provided by (used in) investing activities
    (11,777 )             (15,699 )
                               
Cash flows from financing activities:
                       
  Repayment of long-term debt     (265 )             (10,040 )
  Proceeds from exercise of stock options and ESPP     2,983               1,774  
     
 Net cash provided by (used in) financing activities
    2,718               (8,266 )
                               
     
 Effect of exchange rate changes on cash
    (46 )             (108 )
     
  Increase (Decrease) in cash and cash equivalents
    30,854               (4,131 )
                               
Cash and cash equivalents
                       
     
 Beginning of period
    27,909               32,040  
     
 End of period
  $ 58,763             $ 27,909  
                               
                               
                               
                               
(2) Derived from audited financial statements