Flat to 10% increase in revenue forecast for next quarter ($22m - $24m), but annual rev forecasted to be $95m to $105m.
Given Imaging Reports First Quarter 2005 Results
Monday May 2, 4:02 pm ET
- Quarterly sales growth of 73% to $22 million with EPS of 4 cents -
- A record 29,340 PillCam SB Capsules sold in the first quarter -
YOQNEAM, Israel, May 2 /PRNewswire-FirstCall/ -- Given Imaging Ltd. (Nasdaq: GIVN - News) today announced results for the first quarter ended March 31, 2005.
Worldwide sales of the Given® System and PillCam(TM) video capsules reached $22 million in the first quarter of 2005, a 73% increase over sales of $12.7 million in the first quarter of 2004. Gross margin in the quarter was 70.9% of revenues compared to 70.7% of revenues in the first quarter of 2004. Sales and gross margin both include the impact of the special PillCam ESO and DataRecorder 2.0 promotion that commenced last year and continued through the end of the first quarter, contributing approximately $3.2 million in sales this quarter with a reduced gross margin. Net profit for the first quarter was $1.2 million, or $0.04 per share on a diluted basis, compared to a net loss of $585,000 or $(0.02) per share in the first quarter of 2004. Cash balance at the end of the first quarter was $81.8 million.
"With a record of PillCam SB reorders, our results this quarter underscore that our recurring revenue model is working well," said Gavriel D. Meron, president and CEO of Given Imaging. "In the first quarter, together with InScope, we have built one of the most formidable sales forces in the GI endoscopy market. This team is now poised to leverage on our large and growing installed base to further drive the growth of PillCam sales."
First Quarter 2005 Revenue Analysis
The geographic breakdown of first quarter 2005 sales is as follows:
(Millions of U.S. dollars)
United States $16.3
Europe and ROW $ 5.7
In the first quarter of 2005, worldwide reorders of the PillCam SB capsule endoscope grew to 27,900, 58% higher than the first quarter of 2004 and 15% higher than the fourth quarter of 2004. Sales in the United States increased by 85% mainly due to growth in PillCam SB sales as well as the PillCam ESO and DR 2.0 special promotion. Sales in Europe and ROW increased by 45% compared to the first quarter of 2004, due mainly to strong growth in capsule utilization in Italy, France and Australia. The total number of PillCam SB capsules sold in the quarter was 29,340, 55% higher than in the first quarter of 2004 and 11% higher than the fourth quarter of 2004. To date, cumulative unit sales of PillCam SB have reached 201,000. As part of the PillCam ESO and DataRecorder 2.0 promotional campaign, 6,700 PillCam ESO capsules were sold in the first quarter of 2005, including capsules sold for customer evaluations and for use in clinical trials, compared to 5,300 PillCam ESO capsules sold in the fourth quarter of 2004. Due primarily to the lack of reimbursement coverage, reorders of PillCam ESO capsules in the first quarter were insignificant.
Sales of Given Systems totaled 145 for the first quarter of 2005, compared to 134 systems sold in the first quarter of 2004. Of these systems, 100 were sold in the United States during the first quarter of 2005, compared to 91 sold in the United States in the first quarter of 2004. Cumulatively, there are 2,435 systems placed worldwide, of which 1,432 are in the U.S. reflecting a penetration rate of approximately 20% of the U.S. market.
First Quarter Highlights
-- 4th International Conference on Capsule Endoscopy (ICCE)
In March, more than 430 physicians from 37 countries attended ICCE, the International Conference on Capsule Endoscopy. During the conference, international thought leaders convened to reach consensus on the role of Capsule Endoscopy in the treatment algorithm for the major disease indications. In addition, 118 abstracts were presented on various topics, including use of Capsule Endoscopy in the diagnosis of celiac disease, evaluation of esophageal varices using PillCam ESO in patients with end stage liver disease, and use of PillCam SB in the evaluation of mucosal healing in patients with Crohn's disease.
-- Expanding Reimbursement
PillCam SB
-- The Central Consultation Committee for Reimbursement Issues of
Germany's Federal Chamber of Physicians approved reimbursement for
capsule endoscopy as a first line tool for obscure gastrointestinal
bleeding. This decision provides reimbursement for the 8.2 million
German citizens who are covered by private insurance.
-- In the U.S., as a result of decisions made by Blue Cross Blue Shield
Minnesota, Blue Cross Blue Shield Vermont and Medicare South Carolina
to revise their capsule endoscopy policies to cover expanded
indications, there are now 172 million people in the United States,
compared to 167 million at the end of 2004, who have reimbursement
coverage for use of the PillCam SB capsule for expanded indications,
such as suspected Crohn's disease and small bowel tumors. The total
number of covered lives in the U.S. remains at 206 million.
-- Australia's minister for Health and Ageing approved reimbursement of
PillCam SB for pediatric patients for the obscure GI bleeding
indication effective May 1.
In Europe, the population with reimbursable access to capsule endoscopy grew from 102 million at the end of 2004 to 110 million at the end of the first quarter of 2005. The number of lives with reimbursement for expanded indications remained at 87 million.
The worldwide population with reimbursable access to capsule endoscopy grew to 335 million at the end of the first quarter of 2005 from 327 million at the end of 2004, and the number of lives with reimbursement for expanded indications grew to 258 million at the end of the first quarter from 253 million at the end of 2004.
PillCam ESO
-- Two private insurance companies in Israel, Menora Insurance Company and
Clal Insurance, approved coverage policy for PillCam ESO for
visualization of the esophagus.
-- Efforts are ongoing with private payers in the United states to
initiate coverage policies for PillCam ESO.
-- Given Imaging and partner InScope completed the special promotional
campaign offering a PillCam ESO 10-Pack and new DataRecorder 2.0 at a
combined discounted price. In addition, Given Imaging completed the
upgrade of the installed base to RAPID 3, resulting in 1,300 sites in
the United States now software compatible with PillCam ESO.
New Product Update
-- The Company continued intensive efforts and made progress during the
quarter in the development of the PillCam(TM) COLON. This capsule under
development is designed as an ingestible video capsule for screening
the colon, leveraging on the Rapid platform. At the coming Digestive
Disease Week meeting, to take place May 15-19, in Chicago, IL, the
Company plans to commence enrolling sites for initial clinical trials
with the product, which are expected to begin later this year. We
expect to submit the product for clearance by FDA and launch it in
Europe in 2006.
Operational News
-- Given Imaging completed construction of a second production line for
PillCam ESO in a new facility in Yoqneam.
Second Quarter Guidance/Confirming Annual Guidance
For the second quarter of 2005 the company expects sales of $22 to $24 million, with earnings between $0.06 and $0.10 per share. (In the first quarter the company completed the special PillCam ESO and DR 2.0 promotion, which contributed $3.2 million to the $22 million total revenue in the first quarter). The guided EPS for the second quarter reflects accelerated investments in new product development, expansion of U.S. sale and marketing activities and preparations for anticipated launch in Japan this year. The company confirms its previously provided annual guidance of $95 - 105 million and earnings per share of $0.40-$0.50. |
