CDIC .39
CardioDynamics Reports Fiscal Third Quarter 2007 Results, Third Consecutive Quarterly Revenue Growth Over Prior Year-
Plus-
biz.yahoo.com
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SAN DIEGO, Oct. 9 /PRNewswire-FirstCall/ -- CardioDynamics (Nasdaq: CDIC),
the innovator and leader of BioZ(R) Impedance Cardiography (ICG) technology,
today reported financial results for fiscal third quarter 2007. Operating
results are for the ICG business only and do not include results for Vermed
which was sold on August 31, 2007.
Sales Highlights of Third Quarter 2007 Compared with Third Quarter 2006
-- Net ICG sales increased 8% to $5.6 million, up from $5.2 million
-- ICG sensor revenue increased 15% to $1.8 million, or 32% of total
sales, up from $1.5 million in third quarter 2006, and increased 5%
sequentially over second quarter 2007
-- 7,532 ICG monitors and modules sold to date, up 11% from 6,804 one year
ago
-- ICG monitor sales totaled 121 units, 93 of which were BioZ Dx systems,
19 BioZ monitors, and 9 Medis ICG monitors, up from 119 ICG monitors in
the third quarter of 2006
-- Field headcount totaled 64 field associates, including 32 U.S.
territory managers and 20 clinical application specialists, compared
with 59 field associates, including 32 U.S. territory managers and 18
clinical application specialists
Key Financial Results of Third Quarter 2007 Compared with Third Quarter
2006
-- ICG gross profit margin was 72%, up from 61%
-- Loss from continuing operations improved 22% to $1.2 million, compared
to a loss from operations of $1.5 million a year ago
-- Net loss was $853,000, or ($0.02) per diluted share, compared to net
income of $665,000, or $0.01 per diluted share, which includes a
$2.2 million gain on derivative instruments, for the same period a year
ago
-- Cash, cash equivalents and short term investments increased $4.0
million to $8.4 million, up from $4.4 million on August 31, 2006,
principally as a result of the sale of Vermed
-- Bank debt of $1.5 million was retired
Additional Key Operating Milestones for the Third Quarter 2007
-- Completed $8 million sale of Vermed business
-- Obtained expanded hypertension coverage from local Medicare contractors
for ICG technology in Georgia, Alabama, Mississippi, and South Carolina
-- Presented new ICG hypertension evidence providing framework for new
hypertension research strategy targeted to address questions raised in
the 2006 Medicare reconsideration of ICG coverage for high blood
pressure
-- Entered into strategic alliance agreement with Amarex Clinical Research
which enables advanced data analysis services through Amarex's Secure
WebView Portal for pharmaceutical clinical trial research
Third Quarter 2007 Operating Results Discussion
The Company reported a net sales increase of 8% to $5.6 million for the
third fiscal quarter 2007 and a 12% year-to-date increase to $15.7 million, up
from $14.1 million for the same period a year ago. Third quarter ICG sales
growth was driven by a combination of 15% increase in ICG sensor revenue and
13% improvement in capital sales productivity of the domestic direct sales
force. The increased productivity was the result of improved training and
sales success of newer territory managers and also positive early results from
Phoenix Growth Initiative programs.
ICG Sensor revenue was $1.8 million in the third quarter of 2007, growing
15% from $1.5 million in the same period in 2006, and 5% sequentially from
second quarter 2007. Sensor revenue growth was attributed to the clinical
sales team's ongoing focused customer service efforts and increased use of the
BioZ Assessment Process (BAP), which assists physician offices in
appropriately assessing which patients could benefit from BioZ data. To date,
there are over 1,600 offices who have initiated the BAP into assessment of
patients.
Gross margin as a percentage of sales increased from 61% to 72% in the
third quarter of 2007, largely due to average unit sales price improvements,
increased mix of recurring sensor revenue, lower inventory reserve
requirements, and reduced indirect manufacturing cost allocations.
Operating expenses increased 11% compared with the same period in 2006
driven primarily by a 17% increased in sales and marketing expenses, including
addition of clinical application specialists and a greater allocation of
customer service and technical support department costs that were previously
allocated to cost of sales.
The operating loss improved 22% to $1.2 million, compared to an operating
loss of $1.5 million for the same period in 2006. The year-to-date operating
loss was $4.0 million, a 43% improvement, from the same period in 2006 of
$7.1 million.
CEO Comments and Outlook
Michael K. Perry, Chief Executive Officer of CardioDynamics, stated,
"Achieving our third consecutive quarterly year-over-year revenue growth and
12% growth year-to-date is encouraging and a testament to the continued growth
potential for ICG. The strong progression of sensor revenue seen over the
past two quarters demonstrates the effectiveness of our clinical application
specialist team to improve customers' clinical understanding of ICG and
maximize physician office workflow integration. We were pleased with the
steady improvement in our key operating metrics including a 13% increase in
sales productivity of our direct sales team, 15% growth in ICG sensor revenue,
11% expansion in ICG gross margins, and 22% reduction in operating loss. Our
goal remains to return to positive operating cash flow and profitability as
quickly as possible while making judicious investments that will drive
increased revenue growth and help establish ICG in the treatment guidelines
for heart failure and hypertension over the next five years."
Perry continued, "The sale of Vermed was completed efficiency and, now
with over $8 million in cash, we have increased financial resources to devote
to the growth of our proprietary ICG business. Recently, we announced our
plan to accelerate the return to profitability and this has injected renewed
energy and excitement into our employees. The Phoenix Growth Initiative is
stimulating teamwork across all functions and providing new opportunities for
revenue growth. An initial project, the Legacy Investment Program(TM),
designed to revitalize the early adopters of BioZ technology, was well
received by our customers and is helping drive increased customer
satisfaction, recurring revenue, and capital sales."
Conference Call Information
Michael K. Perry, Chief Executive Officer, and Steve P. Loomis, Chief
Financial Officer, will host a summary of CardioDynamics' third quarter 2007
results in a conference call today, Tuesday October 9, 2007, at 4:30 p.m.
(EDT). To access the conference call, dial 800-346-7359 (Code 7784).
International participants can call 973-528-0008 (Code 7784). A replay of the
call will be available for one month following the call at 800-332-6854 (Code
7784). The international replay number is 973-528-0005 (Code 7784). The
Internet webcast can be accessed through the Investor Relations section of the
Company's website at cdic.com or at
phx.corporate-ir.net
eventDetails&c=86923&eventID=1657461
About CardioDynamics
CardioDynamics (Nasdaq: CDIC), the ICG Company, is the innovator and
leader of an important medical technology called impedance cardiography (ICG).
The Company develops, manufactures and markets noninvasive ICG products. The
Company's ICG Systems are being used by physicians around the world to help
battle the number one killer of men and women -- cardiovascular disease.
Partners include GE Healthcare and Philips Medical Systems. For additional
information, please refer to the company's Web site at cdic.com. |
