Friday April 28, 4:00 am Eastern Time
Company Press Release
VidaMed Reports Improved First Quarter Results
Revenues Increase 143%, Gross Margin Improves to 70%
FREMONT, Calif.--(BW HealthWire)--April 28, 2000-- VidaMed, Inc. (NASDAQ: VIDA - news) today reported financial results for the three months ended March 31, 2000.
First quarter 2000 net revenues were up 143% to $2.5 million, compared with $1.0 million recorded in the prior-year first quarter. On a sequential-quarter basis, sales were up 17%, driven by strong performance in adding new U.S. accounts and by procedure volume gains. Gross margins improved to 70%, compared with 20% in the year-ago quarter and 65% in the previous quarter. The first quarter 2000 net loss narrowed to $2.1 million, or $0.07 per share, representing an improvement of more than $1.0 million compared with the first quarter 1999 net loss of $3.1 million, or $0.16 per share, and a marked improvement over the previous quarter net loss of $2.5 million, or $0.11 per share.
The Company reported that 1,033 TUNA (Transurethral Needle Ablation) procedures for the treatment of Benign Prostatic Hyperplasia (BPH) were performed in the U.S. during the first quarter of 2000, an increase of 127% over procedures performed during the first quarter of 1999 and up 18% on a sequential-quarter basis. There were 597 fee-per-use (FPU) procedures performed during the quarter, up approximately 646% compared with FPU procedures performed during the same period of 1999 and up 34% over the immediate prior quarter. Thirty-seven new FPU customers entered the program in the first quarter of 2000, bringing the total FPU customer base to well over 100.
``The first quarter was exciting and eventful in terms of performance and milestones. We continued to build momentum with our fifth consecutive quarter of growth. We broke the 1,000 mark for TUNA procedures performed in the U.S. in a single quarter. We also were highly successful in establishing quality relationships that support our financial, distribution and business needs,'' commented Randy Lindholm, Chairman, President and Chief Executive Officer.
The quarter began with the announcement of an $11.2 million equity investment in the Company, including a $9.2 million equity investment by Medtronic (NYSE: MDT - news), a leader in the medical industry. This investment was followed by the appointment of Mike Ellwein, Vice President and Chief Development Officer of Medtronic, to the Company's Board of Directors. Other highlights of the quarter include:
-- Completion of a distribution agreement with MC Medical, a division
of Mitsubishi, as the exclusive distributor of the TUNA system in
Japan
-- Approval of Medicare reimbursement of TUNA procedures in the State
of New York
-- The appointment of Steve Williams, previously with Zeiss Humphrey
Systems where VidaMed outsources the manufacturing of its
disposable hand pieces, to Chief Operating Officer
The quarter concluded with the publication of a ruling by the Health Care Financing Administration (HCFA) for a proposed fixed reimbursement payment rate for both TUNA and TUMT (Transurethral Microwave Therapy) for the treatment of BPH in the hospital outpatient setting.
Mr. Lindholm added, ``We recognize that reimbursement will be changing in the near future and we are prepared to move swiftly and diligently to meet the market needs. We welcome this upcoming change to fixed levels of reimbursement under a Prospective Payment System because it signifies the first step towards establishing fixed reimbursement in not only the hospital out patient setting, but also in new markets including the ambulatory surgery setting and the physician office setting. Under a fixed reimbursement scenario, the best-outcome, low-cost solution will rise above the rest - and we believe that TUNA meets that criteria.''
The Company will hold a conference call to discuss these results beginning at 11:00 a.m. Eastern Time today. Individual investors are invited to listen to the conference call over the Internet through Vcall, a service of the Investor Broadcast Network, at www.vcall.com. To listen to the live call, please go to the Web site at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. In addition, a replay will begin shortly after the call has ended and will be available for 90 days.
The Company's TUNA System offers a minimally invasive, less than one hour, outpatient treatment for the symptoms associated with benign prostatic hyperplasia (BPH). These important quality-of-life symptoms include frequent and urgent urination, interruption of stream and nocturia (excessive urination at night), which may lead to sleep deprivation and related problems such as loss of libido and impairment of sexual function. The TUNA procedure is an ideal solution after drug therapy has failed and when Transurethral Resection of the Prostate (TURP) is not an option.
VidaMed designs, develops and markets technologically and clinically advanced cost-effective systems for the treatment of urological conditions. For investor information, please call (800) 363-2994 or visit the Company's Web site at www.vidamed.com.
Certain statements in this news release, including but not limited to statements relating to the increasing demand for the TUNA procedure, increases in the number of TUNA procedures performed each quarter and future increases in revenues and margins, contain forward-looking information. Actual results may vary significantly from those anticipated in such forward-looking statements due to risks and uncertainties, including the rate of adoption of the TUNA procedure by the medical community, the scope and level of reimbursement coverage of the TUNA procedure by Medicare and other payors, the impact of competitive treatments, products and pricing, the development and effectiveness of the Company's sales organization and marketing efforts, and other risks described in the Company's reports filed from time to time with the United States Securities and Exchange Commission.
VIDAMED, INC.
Consolidated Statements of Operations
(Unaudited)
(in thousands, except per share amounts)
Three Months Ended
March 31,
2000 1999
--------------- ---------------
Net revenues $ 2,524 $ 1,037
Cost of products
sold 767 833
--------------- ---------------
Gross profit 1,757 204
Operating expenses
Research and
development 783 814
Selling,
general and
administrative 3,265 2,504
--------------- ---------------
--------------- ---------------
Total operating
expenses 4,048 3,318
--------------- ---------------
Operating income
(loss) (2,291) (3,114)
Other income
(expense) 153 (42)
--------------- ---------------
Net income
(loss) $ (2,138) $ (3,156)
=============== ===============
=============== ===============
Basic and diluted
net income
(loss) per share $ (0.07) $ (0.16)
=============== ===============
Basic and diluted
shares used in
computing net
loss per share 28,936 20,313
=============== ===============
VIDAMED, INC.
Consolidated Balance Sheet
(in thousands)
March 31, December 31,
2000 1999
--------------- ---------------
(Unaudited) (a)
Assets:
Cash, cash equivalents
and short-term
investments $ 12,173 $ 2,748
Other current assets 2,492 2,389
Property and
equipment, net 2,426 2,017
Other assets 101 166
--------------- ---------------
--------------- ---------------
Total assets $ 17,192 $ 7,320
=============== ===============
Liabilities and
stockholders' equity:
Notes payable,
current portion $ 1,390 $ 1,394
Accounts payable
and accrued
liabilities 2,541 3,019
Deferred revenue 339 272
Notes payable,
noncurrent 829 1,030
Total liabilities 5,099 5,715
Stockholder's
equity 12,093 1,605
--------------- ---------------
Total liabilities
and stockholder's
equity $ 17,192 $ 7,320 |
