UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 8, 2011
CANTEL MEDICAL CORP.
(Exact name of registrant as specified in its charter)
Delaware |
|
001-31337 |
|
22-1760285 |
(State or other jurisdiction |
|
(Commission |
|
(IRS Identification |
of incorporation) |
|
File Number) |
|
Number) |
150 Clove Road, Little Falls, New Jersey |
|
07424 |
Address of principal executive offices) |
|
(Zip Code) |
Registrants telephone number, including area code: (973) 890-7220
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition
On December 8, 2011, the Registrant issued a press release announcing its results of operations for the quarter ended October 31, 2011 (Registrants first quarter of fiscal year 2012). A copy of the press release is included with this Report as Exhibit 99.1.
Item 9.01 Financial Statements, Pro-Forma Financial Information and Exhibits
(d) Exhibit 99.1 Press release of Registrant dated December 8¸ 2011.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
CANTEL MEDICAL CORP. | |
|
| |
|
| |
|
By: |
/s/ Andrew A. Krakauer |
|
|
Andrew A. Krakauer |
|
|
President and CEO |
Dated: December 8, 2011
Exhibit 99.1
CANTEL MEDICAL CORP.
150 Clove Road
Little Falls, New Jersey 07424
FOR IMMEDIATE RELEASE
Contact: |
Andrew A. Krakauer |
Richard E. Moyer |
|
President & CEO |
Cameron Associates, Inc. |
|
Cantel Medical Corp. |
richard@cameronassoc.com |
|
Phone: (973) 890-7220 |
Phone: (212) 554-5466 |
CANTEL MEDICAL REPORTS 25% INCREASE IN NET INCOME - EPS OF $0.35 vs. $0.29 - FOR QUARTER ENDED OCTOBER 31, 2011 ON 30% SALES INCREASE
LITTLE FALLS, New Jersey (December 8, 2011) ... CANTEL MEDICAL CORP. (NYSE:CMN) reported a 25% increase in net income to $6,220,000, or $0.35 per diluted share, on a 30% increase in sales to a record $93,262,000 for the first quarter ended October 31, 2011. This compares with net income of $4,975,000, or $0.29 per diluted share, on sales of $71,993,000 for the first quarter ended October 31, 2010.
Andrew Krakauer, Cantels President and CEO stated, We are pleased to have delivered record sales and strong quarterly earnings. These positive results confirm the continued success of our three prong approach to growth which includes investing in new product development, sales and marketing programs and acquisitions. All of these strategies positively affected the results this quarter.
Krakauer added, Our Endoscopy segment had an especially stellar performance this quarter as organic sales grew by 25%, excluding sales from our newly acquired Byrne Medical business. This growth was driven by increased shipments of our newest reprocessor, the DSD Edge, as well as disinfectants and sterilants, parts and service. Byrne Medical, which is in the process of being integrated into the Endoscopy segment, had core sales growth in excess of 30% and was accretive to earnings in the quarter. We also had excellent performance in our Water Purification and Filtration segment, where sales growth of 21% and effective integration of the Gambro water acquisition resulted in a 57% increase in operating income.
The Company also reported that its balance sheet at October 31, 2011 included current assets of $118,617,000, including cash of $19,646,000, a current ratio of 2.27:1, gross debt of $116,500,000 and stockholders equity of $247,257,000. Krakauer stated, We continue to maintain a strong balance sheet and generate substantial cash flow and EBITDAS. When compared with the same quarter last year, our EBITDAS grew by 36% to $15,680,000. We were able to reduce our net debt position by approximately $7 million to $96,854,000, since the close of the Byrne Medical acquisition on the first day of this quarter.
Cantel Medical Corp. (NYSE:CMN) is a leading provider of infection prevention and control products in the healthcare market. Our products include water purification equipment, sterilants, disinfectants and cleaners, specialized medical device reprocessing systems for endoscopy and renal dialysis, disposable infection control products primarily for dental and GI endoscopy markets, dialysate concentrates and other dialysis supplies, hollow fiber membrane filtration and separation products for medical and non-medical applications, and specialty packaging for the transport and temperature regulation of infectious and biological specimens.
The Company will hold a conference call to discuss the results for the first quarter ended October 31, 2011 on Thursday, December 8, 2011 at 11:00 AM Eastern time. To participate in the conference call, dial (877) 407-8033 approximately 5 to 10 minutes before the beginning of the call. If you are unable to participate, a digital replay of the call will be available from Thursday, December 8, 2011 at 2:00 PM through midnight on February 8, 2012 by dialing (877) 660-6853 and using pass code # 286 and conference ID # 384108.
The call will be simultaneously broadcast live over the Internet on vcall.com at http://www.investorcalendar.com/IC/CEPage.asp?ID=166708. A replay of the webcast will be available on Vcall for 90 days.
For further information, visit the Cantel website at www.cantelmedical.com.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve a number of risks and uncertainties, including, without limitation, the risks detailed in Cantels filings and reports with the Securities and Exchange Commission. Such forward-looking statements are only predictions, and actual events or results may differ materially from those projected or anticipated.
CANTEL MEDICAL CORP.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
(unaudited)
|
|
Three Months Ended |
| ||||
|
|
October 31, |
| ||||
|
|
2011 |
|
2010 |
| ||
|
|
|
|
|
| ||
Net sales |
|
$ |
93,262 |
|
$ |
71,993 |
|
|
|
|
|
|
| ||
Cost of sales |
|
55,312 |
|
43,801 |
| ||
|
|
|
|
|
| ||
Gross profit |
|
37,950 |
|
28,192 |
| ||
|
|
|
|
|
| ||
Expenses: |
|
|
|
|
| ||
Selling |
|
12,923 |
|
9,631 |
| ||
General and administrative |
|
12,102 |
|
9,118 |
| ||
Research and development |
|
2,145 |
|
1,629 |
| ||
Total operating expenses |
|
27,170 |
|
20,378 |
| ||
|
|
|
|
|
| ||
Income before interest and income taxes |
|
10,780 |
|
7,814 |
| ||
|
|
|
|
|
| ||
Interest expense |
|
1,031 |
|
241 |
| ||
Interest income |
|
(30 |
) |
(19 |
) | ||
|
|
|
|
|
| ||
Income before income taxes |
|
9,779 |
|
7,592 |
| ||
|
|
|
|
|
| ||
Income taxes |
|
3,559 |
|
2,617 |
| ||
|
|
|
|
|
| ||
Net income |
|
$ |
6,220 |
|
$ |
4,975 |
|
|
|
|
|
|
| ||
Earnings per common share - diluted |
|
$ |
0.35 |
|
$ |
0.29 |
|
|
|
|
|
|
| ||
Dividends per common share |
|
$ |
0.07 |
|
$ |
0.06 |
|
|
|
|
|
|
| ||
Weighted average shares - diluted |
|
17,933 |
|
16,993 |
|
CANTEL MEDICAL CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(unaudited)
|
|
October 31, |
|
July 31, |
| ||
|
|
2011 |
|
2011 |
| ||
Assets |
|
|
|
|
| ||
Current assets |
|
$ |
118,617 |
|
$ |
111,324 |
|
Property and equipment, net |
|
44,214 |
|
34,459 |
| ||
Intangible assets, net |
|
78,167 |
|
39,191 |
| ||
Goodwill |
|
184,545 |
|
134,770 |
| ||
Other assets |
|
3,678 |
|
1,699 |
| ||
|
|
$ |
429,221 |
|
$ |
321,443 |
|
|
|
|
|
|
| ||
Liabilities and stockholders equity |
|
|
|
|
| ||
Current portion of long-term debt |
|
$ |
10,000 |
|
$ |
|
|
Other current liabilities |
|
42,212 |
|
43,411 |
| ||
Long-term debt |
|
106,500 |
|
24,000 |
| ||
Other long-term liabilities |
|
23,252 |
|
19,717 |
| ||
Stockholders equity |
|
247,257 |
|
234,315 |
| ||
|
|
$ |
429,221 |
|
$ |
321,443 |
|
SUPPLEMENTARY INFORMATION
Reconciliation of Earnings Before Interest, Taxes, Depreciation, Amortization and Stock-Based Compensation Expense (EBITDAS)
The reconciliation of EBITDAS with net income for the three months ended October 31, 2011 and 2010, respectively, is as follows (in thousands):
|
|
Three Months Ended |
| ||||
|
|
October 31, |
| ||||
|
|
2011 |
|
2010 |
| ||
|
|
|
|
|
| ||
Net income |
|
$ |
6,220 |
|
$ |
4,975 |
|
|
|
|
|
|
| ||
Income taxes |
|
3,559 |
|
2,617 |
| ||
Interest expense |
|
1,031 |
|
241 |
| ||
Interest income |
|
(30 |
) |
(19 |
) | ||
Depreciation |
|
1,677 |
|
1,628 |
| ||
Amortization |
|
2,289 |
|
1,319 |
| ||
Loss (gain) on disposal of fixed assets |
|
3 |
|
(11 |
) | ||
|
|
|
|
|
| ||
EBITDA |
|
14,749 |
|
10,750 |
| ||
|
|
|
|
|
| ||
Stock-based compensation expense |
|
931 |
|
765 |
| ||
|
|
|
|
|
| ||
EBITDAS |
|
$ |
15,680 |
|
$ |
11,515 |
|
EBITDAS is a measure of the Companys performance that is not required by, or presented in accordance with, Generally Accepted Accounting Principles (GAAP). EBITDAS is a non-GAAP financial measure defined by the Company as income before interest, taxes, depreciation, amortization and stock-based compensation expense. The Company believes EBITDAS is an important valuation measurement for management and investors given the increasing effect that non-cash charges, such as stock-based compensation, amortization related to acquisitions and depreciation of capital equipment, has on the Companys net income. In particular, acquisitions have historically resulted in significant increases in amortization of intangible assets that reduced the Companys net income. Additionally, the Company regards EBITDAS as a useful measure of operating performance and cash flow before the effect of interest expense and complements operating income, net income and other GAAP financial performance measures. Generally, a non-GAAP financial measure is a numerical measure of a Companys performance, financial position or cash flow that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. This measure, however, should be considered in addition to, and not as a substitute or superior to, net income, cash flows, or other measures of financial performance prepared in accordance with GAAP.