EX-99.1 2 a08-12378_1ex99d1.htm EX-99.1

Exhibit 99.1

 

1600 West Merit Parkway South Jordan, UT  84095

Telephone:  801-253-1600 Fax:  801-253-1688

 

PRESS RELEASE

 

FOR IMMEDIATE RELEASE

 

Date:

 

April 24, 2008

Contact:

 

Anne-Marie Wright, Vice President, Corporate Communications

Phone:

 

(801) 208-4167 e-mail: awright@merit.com Fax: (801) 253-1688

 

MERIT MEDICAL ANNOUNCES 50% INCREASE IN EPS

ON IMPROVED SALES AND GROSS MARGINS

 

SOUTH JORDAN, UTAH— Merit Medical Systems, Inc. (NASDAQ: MMSI), a leading manufacturer and marketer of proprietary disposable devices used primarily in cardiology and radiology procedures, today announced sales of $53.6 million for the first quarter ended March 31, 2008, an increase of 5% over sales of $51.0 million for the first quarter of 2007.

 

Net income for the first quarter of 2008 improved 45% to $4.3 million, compared to $3.0 million for the first quarter of 2007. Earnings per share for the quarter ended March 31, 2008 increased 50% to $0.15 per share, up from $0.10 per share for the first quarter of 2007.

 

“It is rewarding to see the results of our efforts and the continued improvement of the fundamental indicators of our business,” said Fred P. Lampropoulos, Merit’s Chairman and Chief Executive Officer.

 

For the first quarter of 2008, compared to the first quarter of 2007, catheter sales increased 11%; inflation device sales rose 7%; stand-alone device sales grew 6%; and custom kit and tray sales remained essentially flat.

 

Gross margins for the first quarter of 2008 were 40.3% of sales, compared to 37.0% of sales for the first quarter of 2007, an increase of 330 basis points. This significant improvement in gross margins demonstrates the results of increased productivity coming from an 18% reduction in manufacturing headcount and cost savings initiatives.

 

Selling, general and administrative expenses for the first quarter of 2008 were 24.4% of sales, compared to 23.5% of sales for the first quarter of 2007. Research and development

 



 

costs during the first quarter of 2008 were 3.6% of sales compared to 4.6% of sales for the first quarter of 2007.

 

Income from operations for the quarter ended March 31, 2008 was $6.6 million, compared to $4.5 million for the first quarter of 2007.

 

Merit’s effective tax rate for the first quarter of 2008 was 36.0%, compared with 35.0% for the comparable period of 2007.

 

Merit’s cash position was $23.8 million on March 31, 2008, compared with $17.6 million on December 31, 2007.

 

CONFERENCE CALL

 

Merit Medical invites all interested parties to participate in its conference call today, April 24, 2008, 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 866-250-2351, and the international number is 303-205-0044. A live webcast as well as a rebroadcast of the conference call can be accessed through the Investors page at www.merit.com or through the webcasts tab at www.fulldisclosure.com.

 



 

INCOME STATEMENT

(Unaudited, in thousands except per share data)

 

 

 

Three Months Ended

 

 

 

March  31,

 

 

 

2008

 

2007

 

 

 

 

 

 

 

SALES

 

$

53,553

 

$

51,030

 

 

 

 

 

 

 

COST OF SALES

 

31,961

 

32,172

 

 

 

 

 

 

 

GROSS PROFIT

 

21,592

 

18,858

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

Selling, general and administrative

 

13,072

 

12,015

 

Research and development

 

1,916

 

2,364

 

Total

 

14,988

 

14,379

 

 

 

 

 

 

 

INCOME FROM OPERATIONS

 

6,604

 

4,479

 

 

 

 

 

 

 

OTHER INCOME (EXPENSE)

 

 

 

 

 

Interest income

 

150

 

89

 

Other income (expense)

 

(5

)

(1

)

Total Other Income - net

 

145

 

88

 

 

 

 

 

 

 

INCOME BEFORE INCOME TAXES

 

6,749

 

4,567

 

 

 

 

 

 

 

INCOME TAX EXPENSE

 

2,432

 

1,598

 

 

 

 

 

 

 

NET INCOME

 

$

4,317

 

$

2,969

 

 

 

 

 

 

 

EARNINGS PER COMMON SHARE-

 

 

 

 

 

Basic

 

$

0.16

 

$

0.11

 

 

 

 

 

 

 

Diluted

 

$

0.15

 

$

0.10

 

 

 

 

 

 

 

AVERAGE COMMON SHARES-

 

 

 

 

 

Basic

 

27,495,314

 

27,652,971

 

 

 

 

 

 

 

Diluted

 

28,301,487

 

28,616,595

 

 



 

BALANCE SHEET

(Unaudited in thousands)

 

 

 

March 31,

 

December 31,

 

 

 

2008

 

2007

 

ASSETS

 

 

 

 

 

Current Assets

 

 

 

 

 

Cash and cash equivalents

 

$

23,757

 

$

17,574

 

Trade receivables, net

 

25,391

 

26,619

 

Employee receivables

 

161

 

144

 

Other receivables

 

929

 

1,140

 

Inventories

 

34,643

 

34,106

 

Prepaid expenses and other assets

 

1,072

 

1,297

 

Deferred income tax assets

 

2,087

 

811

 

Income tax refunds receivable

 

417

 

297

 

Total Current Assets

 

88,457

 

81,988

 

 

 

 

 

 

 

Property and equipment, net

 

100,735

 

99,696

 

Other intangibles, net

 

6,610

 

6,163

 

Goodwill

 

11,632

 

9,527

 

Other assets

 

2,911

 

2,964

 

Deferred income tax assets

 

336

 

4

 

Deposits

 

78

 

78

 

Total Assets

 

$

210,759

 

$

200,420

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

Current Liabilities

 

 

 

 

 

Trade payables

 

11,246

 

10,275

 

Other payables

 

1,500

 

 

 

Accrued expenses

 

9,821

 

9,492

 

Advances from employees

 

261

 

267

 

Liabilities related to unrecognized tax positions

 

 

 

1,023

 

Income taxes payable

 

2,597

 

737

 

Total Current Liabilities

 

25,425

 

21,794

 

 

 

 

 

 

 

Deferred income tax liabilities

 

6,533

 

6,082

 

Liabilities related to unrecognized tax positions

 

2,588

 

2,588

 

Deferred compensation payable

 

3,048

 

3,063

 

Deferred credits

 

2,078

 

2,105

 

Other long-term obligation

 

389

 

420

 

Total Liabilities

 

40,061

 

36,052

 

 

 

 

 

 

 

Stockholders’ Equity

 

 

 

 

 

Common stock

 

54,301

 

52,477

 

Retained earnings

 

116,264

 

111,947

 

Accumulated other comprehensive loss

 

133

 

(56

)

Total stockholders’ equity

 

170,698

 

164,368

 

 

 

 

 

 

 

Total Liabilities and Stockholders’ Equity

 

$

210,759

 

$

200,420

 

 



 

ABOUT MERIT

 

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 90 individuals. Merit employs approximately 1,570 people worldwide, with facilities in Salt Lake City and South Jordan, Utah; Angleton, Texas; Richmond, Virginia; Maastricht and Venlo, The Netherlands; and Galway, Ireland.

 

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;  termination or interruption of relationships with suppliers, or failure of suppliers to perform; product recalls and product liability claims; inability to successfully manage growth, particularly through acquisitions; failure to comply with governing regulations; changes in health care markets related to health care reform initiatives; delays in obtaining regulatory approvals, or the failure to maintain such approvals; concentration of Merit’s sales among a few products, procedures and/or customers; 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; dependency upon key personnel; work stoppage or transportation risks; modification or limitation of governmental or private insurance reimbursement; and other factors referred to in Merit’s Annual Report on Form 10-K 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 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.

 

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