All: Here is the earnings release. Apparently the conference call was only available live. I missed about the first 10-12 minutes. I called the number back hoping for a replay but only got music. An operator finally came on and gave me an 800 number to call about replays. The person there said the call was recorded but no arrangements were made for replay. He gave me the name of the person who made the arrangements. I'll try to track her down and see if I can get a replay or transcript.
Thursday July 31 8:40 AM EDT
Company Press Release
Source: Exactech, Inc.
Exactech Q2 Net Income Up 24% Q2 Revenue Increases
25% On Strong Knee Sales
GAINESVILLE, Fla., July 31 /PRNewswire/ -- Exactech, Inc. (Nasdaq:EXAC) announced today that second quarter revenue increased 25% to $4,234,644 from $3,400,233 in the second quarter of 1996. Net income for the quarter rose 24% to $452,800 from $364,176 in the same quarter last year. Earnings per share for the quarter were $.09 versus $.10 in the second quarter of 1996, due to a higher number of shares outstanding following the company's initial public offering on May 30,
1996.
For the six month period ending June 30, 1997, net sales were up 22% to $8,334,183 from $6,823,862 in the same period last year. Net income for the six months was up 33% to $891,034 from $669,827 for the corresponding period last year. Earnings per share were $.18 versus $.20 for the first six months of 1996.
Exactech Chairman and CEO William Petty said, ``We again experienced strong double digit growth in net sales of our Optetrak(R) knee system with penetration of new markets. Unit sales of primary and revision knee replacements were up 45%, and up 47% on a dollar basis. We experienced higher profit margins as a result of lower costs associated with increased production volume. This is further evidence of the excellent reception our knees are gaining from both surgeons
and patients. Unit hip product sales were up slightly. The hip product sales results were affected by a delay in our rollout schedule for the AuRA(TM) hip system due to production issues which we hope will be resolved by the third quarter. More instrumentation and inventory availability should result in positive growth in hip product sales in the fourth quarter.''
President and COO Tim Seese said, ``Our higher costs in the quarter reflected the significant investment we continue to make in research and development and hiring and training new sales representatives as part of building our worldwide distribution and marketing network. We hope to see a positive impact on revenues from this investment over the next two quarters. Although net income growth for the quarter was strong, earnings per share were lower because of the increase in
shares outstanding versus the same period a year ago. Weighted average shares outstanding for the second quarter of 1997 increased to 4.94 million from 3.68 million in the second quarter of 1996. The number of shares outstanding in the upcoming third quarter will be close to the number of shares outstanding in the third quarter of 1996 which means percentage change in earnings per share should be in balance with change in net income.'' Exactech's public offering of 1,840,000 shares of common stock occurred May 30, 1996.
Based in Gainesville, Fla., Exactech develops, manufactures and markets orthopaedic implant devices and related surgical instruments to hospitals and physicians. The company's orthopaedic implant devices are used to replace joints which have deteriorated as a result of injury or diseases such as arthritis.
Exactech contracts with independent sales agents to market its products in the United States and in nine countries in Europe, Asia and Latin America.
Copies of EXAC press releases, SEC filings, current price quotes and other valuable information for investors may be found on the website hawkassociates.com.
A copy of the quarterly financials is attached.
EXAC has scheduled a conference call today (July 31) at 11:00 a.m. to discuss the earnings release. Those wishing to participate in the call with senior members of the management team may do so by calling 800-950-7703 any time after 10:55 a.m. on July 31st. The pass code is 2266#.
This release contains various forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 which represent the company's expectations or beliefs concerning future events of the company's financial performance. These forward looking statements are further qualified by important factors that could cause actual results to differ materially from those in the forward looking statements. These factors include the effect of competitive pricing, the company's dependence on the ability of third party manufacturers to produce components on a basis which is cost-effective to the company, market acceptance of the company's products and the effects of government regulation. Results actually achieved may differ materially from expected results included in these statements.
EXACTECH, INC.
CONDENSED STATEMENTS OF INCOME
(Unaudited)
Three Month Period Six Month Period
Ended June 30, Ended June 30,
1997 1996 1997 1996
NET SALES $4,234,644 $3,400,233 $8,334,183 $6,823,862
COST OF GOODS SOLD 1,301,735 1,216,207 2,668,421 2,483,539
Gross profit 2,932,909 2,184,026 5,665,762 4,340,323
OPERATING EXPENSES:
Sales and marketing 1,218,181 794,283 2,345,352 1,631,492
General and
administrative 415,402 292,509 775,188 565,785
Research and
development 240,449 171,471 482,404 332,525
Depreciation and
amortization 186,321 112,895 351,107 228,970
Royalties 204,904 138,034 393,290 282,230
Total operating
expenses 2,265,257 1,509,192 4,347,341 3,041,002
INCOME FROM OPERATIONS 667,652 674,834 1,318,421 1,299,321
OTHER INCOME (EXPENSE)
Interest income
(expense) 57,755 (66,270) 140,575 (170,379)
Equity in net
loss of subsidiary (10,000) (14,199) (25,000) (32,199)
INCOME BEFORE
INCOME TAXES 715,407 594,365 1,433,996 1,096,743
PROVISION FOR
INCOME TAXES 262,607 225,859 542,962 416,762
NET INCOME 452,800 368,506 891,034 679,981
PREFERRED STOCK
DIVIDENDS 0 4,330 0 10,154
NET INCOME AVAILABLE
TO COMMON
SHAREHOLDERS $452,800 $364,176 $891,034 $669,827
NET INCOME PER
COMMON AND COMMON
SHARE EQUIVALENT $0.09 $0.10 $0.18 $0.20
WEIGHTED AVERAGE
COMMON AND COMMON
SHARE EQUIVALENTS
OUTSTANDING 4,935,018 3,677,959 4,943,745 3,355,103
EXACTECH, INC.
CONDENSED BALANCE SHEETS
(Unaudited)
June 30, December 31,
1997 1996
ASSETS
CURRENT ASSETS
Cash and cash
equivalents $2,360,935 $3,992,442
Short-term investments 2,064,790 3,083,788
Trade receivables 3,042,655 2,462,864
Prepaid expenses
and other assets 484,742 194,009
Inventories 9,855,090 7,625,756
Total Current Assets 17,808,212 17,358,859
PROPERTY AND EQUIPMENT
Machinery and
equipment 5,129,161 4,174,394
Furniture and fixtures 121,645 115,089
Total 5,250,806 4,289,483
Accumulated depreciation (1,638,820) (1,322,392)
Net property and
equipment 3,611,986 2,967,091
OTHER ASSETS
Land held for
future use 263,301 263,301
Biologic products
license 106,494 ---
Investment in
subsidiary 86,914 100,638
Deferred financing
costs, net 6,028 21,296
Advances and deposits 251,800 2,442
Patents and trademarks
(net of amortization) 382,813 393,445
Total Other Assets 1,097,350 781,122
TOTAL ASSETS $22,517,548 $21,107,072
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable $1,818,158 $1,430,321
Income taxes payable 72,705 40,986
Current portion of
long-term debt
and leases 4,586 32,861
Commissions payable 412,832 373,900
Royalties payable 197,450 168,387
Other liabilities 79,483 135,823
Total Current
Liabilities 2,585,214 2,182,278
Deferred income taxes 326,875 326,875
Long-term debt and capital
lease-net of current
portion 15,571 18,144
Total Liabilities 2,927,660 2,527,297
COMMON SHAREHOLDERS' EQUITY:
Common stock 48,862 48,604
Additional paid in capital14,934,409 14,815,588
Retained earnings 4,606,617 3,715,583
Total Common Shareholders'
Equity 19,589,888 18,579,775
TOTAL LIABILITIES
AND EQUITY $22,517,548 $21,107,072
SOURCE: Exactech, Inc.
Contact: Frank N. Hawkins, Jr., 305-852-2383, or fax, 305-852-2378, or Fhawk@hawkassociates.com, or http: |
