AngioDynamics Fiscal Fourth Quarter Operating Profit up 31% on 23% Increase in Net Sales; Fiscal Year 2005 Net Sales Top a Record $60 Million; Net Income Rises 45%.QUEENSBURY, N.Y. -- Company to Provide Fiscal 2006 Financial Guidance Conference Call to Begin Today at 8:30 A.M. ET AngioDynamics, Inc. (Nasdaq:ANGO ANGO Algemene Nederlandse Gehandicapten Organisatie (Dutch: Equal Opportunities for Persons with Disabilities) ) today announced financial results for the 13 and 52 weeks ended May 28, 2005. Highlights of the fourth quarter of fiscal year 2005 (March through May) and recent weeks include: --Net sales up 23% to $17.3 million, compared with the fiscal 2004 fourth quarter --Gross margin up 300 basis points to 56.3% --Operating profit up 31% to $2.5 million --Market release of TOTAL ABSCESSION(TM) general drainage catheter --Favorable Markman ruling in Diomed litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. --Company added to Russell 3000 and Russell Microcap microcap 1. Of or relating to the common stock of a company with a small capitalization, usually between $50 million and $250 million. Microcap stocks tend to experience volatile price movements and are subject to investment fraud schemes. Indices --AngioDynamics named one of BusinessWeek's Top 100 Growth Companies Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the fourth quarter of fiscal 2005 were $17.3 million, an increase of 23% over net sales of $14.1 million for the fourth quarter of fiscal 2004. The increase reflects strong growth from most of the Company's product lines. Sales of Vascular Access vascular access Clinical medicine The ability to enter the vascular system; the ease with which the vascular system can be entered for administering therapy or obtaining blood for testing products grew 150%, with the Morpheus(TM) CT PICC PICC Peripherally-inserted central catheter Critical care An IV catheter inserted in the superior vena cava for long-term infusion of bolus or continuous delivery of therapeutics or TPN–drugs, fluids, nutrients, chemotherapy. Cf Catheter. , a new product introduced in fiscal 2005, accounting for most of the gains in this line. VenaCure(TM) product sales were up 33% over the 2004 quarter, while hemodialysis products Hemodialysis product (HDP) - is a number used to quantify hemodialysis and peritoneal dialysis treatment adequacy. It was proposed by Scribner and Oreopoulous[1] because of their perceived inadequacy of the Kt/V measure of dialysis adequacy. and angiographic products grew 15% and 12%, respectively. Gross profit increased 30% to $9.8 million for the fiscal 2005 fourth quarter from $7.5 million for the prior-year fourth quarter, and gross margin rose to 56.3% from 53.3%, a 300 basis point increase. This gross margin improvement is largely due to a product mix weighted more heavily toward higher margin disposable products, lower raw material costs and modest price increases implemented late in fiscal 2004 and early in fiscal 2005. Operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. for the 13 weeks ended May 28, 2005 increased to $2.5 million, from $1.9 million for the prior-year fourth quarter, a gain of 31%. Net income for the fourth quarter of fiscal 2005 was $1.7 million, or $0.13 per diluted share, compared with net income of $1.5 million, or $0.15 per diluted share, for the fiscal 2004 fourth quarter. The Company's effective income tax rate for the fiscal 2005 fourth quarter was 36%, compared with a tax rate of only 14% in the prior-year period when the Company realized a tax benefit from the utilization of capital loss carryforwards Loss Carryforward An accounting technique with which a company applies net operating losses of the current year to future year's profits in order to reduce tax liability. Notes: by its former parent, E-Z-EM (Nasdaq:EZEM). Eamonn P. Hobbs, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of AngioDynamics, commented, "This quarter marked the completion of another great year at AngioDynamics and our first year as a publicly traded company publicly traded company A company whose shares of common stock are held by the public and are available for purchase by investors. The shares of publicly traded firms are bought and sold on the organized exchanges or in the over-the-counter market. . The continued sales and unit growth of the product lines on which we have particularly focused our sales support, such as the VenaCure procedure kits, and acceptance of our new products, such as the Morpheus PICC line, provide tangible evidence of our commitment to innovation and the high level of performance from our staff. Our financial performance, including gross margin improvement, is a strong testament to how well all aspects of our business are running." Hobbs continued, "On a more specific note about the fourth quarter, I'd like to point out that we were successful in our strategy to refocus Verb 1. refocus - focus once again; The physicist refocused the light beam" focus - cause to converge on or toward a central point; "Focus the light on this image" 2. certain sales initiatives and leverage the flexibility of our sales force. In the fiscal 2005 third quarter, we channeled resources to establish our new Morpheus CT PICC in the marketplace with great success. In the fourth quarter, we refocused our sales attention back to VenaCure. Our fourth quarter results reflect how well this approach worked as Morpheus growth remained on track while VenaCure sales increased significantly, as did its market share." For the 52 weeks ended May 28, 2005, net sales were $60.3 million, up 23% from net sales of $49.1 million for fiscal 2004. Gross margin for fiscal 2005 was 55.4%, representing an increase over the prior year of 280 basis points. The margin improvement is due to a product mix weighted towards higher margin disposable products, lower material costs, manufacturing efficiencies and modest price increases implemented late in fiscal 2004 and early in fiscal 2005. Net income for fiscal 2005 increased 45% to $4.5 million, or $0.37 per diluted share, from $3.1 million, or $0.32 per diluted share, for fiscal 2004. The Company's effective income tax rate for fiscal 2005 was 40%, compared with 28% for fiscal 2004, the increase again due to the use of capital loss carryforwards in 2004. The improvement in EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. from fiscal 2004 was partially offset by an increase in weighted average shares outstanding. AngioDynamics had cash and investments totaling $27.1 million as of May 28, 2005, compared with $2.5 million as of May 29, 2004. The increase is due primarily to the receipt, in June 2004, of proceeds from the Company's initial public offering, and the Company's positive operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. during fiscal 2005. Fiscal Year 2006 Financial Guidance Regarding financial guidance for fiscal 2006, Mr. Hobbs said, "We expect net sales growth to exceed 20% compared with fiscal 2005, to approximately $72 million. Year-over-year net income growth is expected to exceed 27%, to $5.8 million, which includes the anticipated impact of one-time charges totaling $366,000, net of income taxes, to be incurred in conjunction with our requirement to comply with Section 404 of the Sarbanes-Oxley Act See SOX. by May 2006. Without the effect of these expenses, net income would be expected to reach $6.1 million, or 35% net income growth from fiscal 2005. R&D and SG&A expenses should continue to top out at approximately 8% and 36% of net sales, respectively. Our plans also call for the continued growth of our sales force. We expect to have about 70 dedicated sales reps in the field over the next 30 months, up from 46 currently. Gross margins have increased nicely according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. our plans, and we see gross margins increasing in fiscal 2006 by approximately 200 basis points, continuing on our goal to achieve gross margins in the low-to-mid 60% range." Conference Call AngioDynamics management will host a conference call to discuss this announcement today, July 22, 2005, beginning at 8:30 a.m. Eastern Time. To participate in the call, please dial (877) 815-7177 from the U.S., or (706) 634-1250 from outside the U.S. A telephone replay of the call will be available from 9:30 a.m. Eastern Time on July 22, 2005 through 11:59 p.m. Eastern Time on July 26th by dialing (888) 642-1687 from the U.S., or (706) 645-9291 from outside the U.S., and entering reservation number 7945957. In addition, individuals may listen to the call on the Internet by visiting the investor relations Investor relations The process by which the corporation communicates with its investors. portion of the Company's Web site at. www.angiodynamics.com. A recording of the conference call will be archived there for 12 months. About AngioDynamics AngioDynamics, Inc. (www.angiodynamics.com) is a leading provider of innovative medical devices used by interventional radiologists, vascular surgeons and other physicians for the minimally invasive diagnosis and treatment of peripheral vascular disease Peripheral Vascular Disease Definition Peripheral vascular disease is a narrowing of blood vessels that restricts blood flow. It mostly occurs in the legs, but is sometimes seen in the arms. . AngioDynamics, Inc. designs, develops, manufactures and markets a broad line of therapeutic and diagnostic devices that enable interventional physicians, such as interventional radiologists, vascular surgeons and others, to treat peripheral vascular diseases and other non-coronary diseases. The Company's diverse product line includes angiographic catheters, hemodialysis hemodialysis /he·mo·di·al·y·sis/ (-di-al´i-sis) removal of certain elements from the blood by virtue of the difference in rates of their diffusion through a semipermeable membrane while being circulated outside the body; the process catheters, endovascular laser venous system products, PTA PTA or parent-teacher association: see parent education. dilation dilation /di·la·tion/ (di-la´shun) 1. the act of dilating or stretching. 2. dilatation. di·la·tion n. 1. balloon catheters balloon catheter n. A catheter with an inflatable balloon at its tip, used especially to expand a partially obstructed blood vessel or bodily passage and to measure blood pressure in a blood vessel. Also called balloon-tip catheter. , image-guided vascular access products, thrombolytic thrombolytic /throm·bo·lyt·ic/ (throm?bo-lit´ik) dissolving or splitting up a thrombus, or an agent that so acts. thrombolytic 1. dissolving or splitting up a thrombus. 2. an agent that dissolves or splits up a thrombus. products and drainage products. The statements made in this document contain certain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve a number of risks and uncertainties. Words such as "expects," "intends," "anticipates," "plans," "believes," "seeks," "estimates," or variations of such words and similar expressions, are intended to identify such forward-looking statements. Investors are cautioned that actual events or results may differ from the Company's expectations. In addition to the matters described above, the ability of the Company to develop its products, future actions by the FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. or other regulatory agencies regulatory agency Independent government commission charged by the legislature with setting and enforcing standards for specific industries in the private sector. The concept was invented by the U.S. , results of pending or future clinical trials, overall economic conditions, general market conditions, market acceptance, foreign currency exchange rate fluctuations, the effects on pricing from Group Purchasing Organizations A group purchasing organization is an entity that leverages the purchasing power of a group of businesses to obtain discounts from vendors based on the collective buying power of the GPO members. Many GPOs are funded by administrative fees that are actually paid by the vendors. , competition, including alternative procedures which continue to replace traditional fluoroscopic Fluoroscopic (fluoroscopy) An x-ray procedure that produces immediate images and motion on a screen. The images look like those seen at airport baggage security stations. Mentioned in: Hypotonic Duodenography procedures, as well as the risk factors listed from time to time in the SEC filings of AngioDynamics, Inc., including but not limited to its Form 10-Q Form 10-Q See 10-Q. for the quarter ended February 26, 2005, and its Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended May 29, 2004, may affect the actual results achieved by the Company.
AngioDynamics, Inc. and Subsidiary
CONSOLIDATED INCOME STATEMENT HIGHLIGHTS
(in thousands, except shares and per share data)
Thirteen weeks ended Fifty-two weeks ended
----------------------- ----------------------
May 28, May 29, May 28, May 29,
2005 2004 2005 2004
----------- ----------- ----------- ----------
(unaudited)
Net sales $17,332 $14,119 $60,289 $49,055
Cost of goods sold 7,576 6,599 26,912 23,254
----------- ----------- ----------- ----------
Gross profit 9,756 7,520 33,377 25,801
----------- ----------- ----------- ----------
Gross margin % 56.3% 53.3% 55.4% 52.6%
Operating expenses
Selling and
administrative 5,945 4,650 21,080 17,127
Research and
development 1,294 954 4,570 3,551
----------- ----------- ----------- ----------
Total operating
expenses 7,239 5,604 25,650 20,678
----------- ----------- ----------- ----------
Operating profit 2,517 1,916 7,727 5,123
Other income (expense),
net 98 (121) (109) (742)
----------- ----------- ----------- ----------
Income before income tax
provision 2,615 1,795 7,618 4,381
Income tax provision 948 249 3,069 1,238
----------- ----------- ----------- ----------
NET INCOME $1,667 $1,546 $4,549 $3,143
=========== =========== =========== ==========
Earnings per common
share
Basic $.14 $.17 $.39 $.34
=========== =========== =========== ==========
Diluted $.13 $.15 $.37 $.32
=========== =========== =========== ==========
Weighted Average Common
Shares
Basic 11,863,823 9,200,000 11,571,317 9,216,027
Diluted 12,672,346 10,107,296 12,328,783 9,838,168
AngioDynamics, Inc. and Subsidiary
CONSOLIDATED BALANCE SHEET HIGHLIGHTS
(in thousands)
May 28, May 29,
Assets 2005 2004
-------- --------
Current Assets
Cash and Cash Equivalents $14,498 $1,747
Marketable Securities 12,601 737
Restricted Cash 101
Accounts Receivable, net 9,929 7,945
Stock subscription receivable 19,949
Inventories 10,264 8,545
Deferred income taxes 736 681
Other current assets 1,679 670
-------- --------
Total current assets 49,707 40,375
Property, Plant & Equipment - at cost, net 8,528 7,343
Other Non-Current Assets 1,437 2,008
-------- --------
Total Assets $59,672 $49,726
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities $7,627 $9,394
Long-term Debt 2,935 3,100
Stockholders' Equity 49,110 37,232
-------- --------
Total Liabilities and Stockholders' Equity $59,672 $49,726
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