Circon Announces Fourth Quarter 1996 Results.SANTA BARBARA Santa Barbara (săn'tə bär`brə, –bərə), city (1990 pop. 85,571), seat of Santa Barbara co., S Calif., on the Pacific Ocean; inc. 1850. , Calif.--(BW HealthWire)--Feb. 4, 1997-- Richard A. Auhll, chairman and president, today announced fourth quarter 1996 results. Circon's (NASDAQ/NMS:CCON CCON Call Control ) fourth quarter U.S. sales force sales were up 10% over the comparable 1995 period and were the highest of any quarter since the merger with Cabot Medical in August 1995. International sales were down primarily due to a fourth quarter 1995 initial stocking order of our Japanese distributor. This caused total sales to be level for the respective fourth quarters. Year-end total sales were $153.8 million compared to a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma combined of $160.4 million in 1995 even though the two companies were not merged for the full year. Fourth quarter gross profit as a percent of sales reached 56.6%, up from 55.1% of the prior year. Net income grew 21% over the same period last year to $1.2 million. Post Merger Transition - 2nd Quarter to 4th Quarter During the initial six months transition period immediately following the merger with Cabot Medical, the newly combined U.S. sales force had uneven performance. However, after the second quarter the performance improvement of the U.S. sales force and general operating results have been most gratifying grat·i·fy tr.v. grat·i·fied, grat·i·fy·ing, grat·i·fies 1. To please or satisfy: His achievement gratified his father. See Synonyms at please. 2. . From the second quarter through the fourth quarter, total sales and U.S. sales force revenues have grown at an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. rate of 7% and 13%, respectively. Gross profit improved at an annualized rate of 11%. Over the same periods, operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. increased 153% to $2.4 million, and net income rose to $1.2 million. Ongoing Activities International sales is a key area of focus. Circon utilizes specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. distributors in most countries; however in 1996, two distribution changes were implemented. First, the Cabot Medical products were removed from their Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. distributor and are now being sold by Circon's direct Canadian sales force. Also, late in the third quarter 1996, a Circon direct sales force was established in France. Fourth quarter sales results were encouraging and the French sales organization should become productive in 1997. Cabot Medical's Langhorne, Pa., facility was closed at the end of October 1996. The full benefit of the closure will begin when the new tenant leases on that facility commence in the first quarter 1997. As a result of the Langhorne closure and other measures, fourth quarter gross profit as a percent of sales reached 56.6%, up from 55.1% for the same 1995 period and 1.0 percentage point over 55.6% over the immediately preceding third quarter. Several important new products began shipping in the fourth quarter, most notably the $12,000 AUR-7 Flexible Ureteroscope which is the smallest diameter instrument of its type in the world. Numerous other products are targeted for release in the first and second quarters of 1997. Strategic Plan Circon is proceeding under a carefully crafted Strategic Plan which includes three basic elements: 1. Acquire Cabot Medical and capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. its strategic position in the gynecology gynecology (gīn'əkŏl`əjē), branch of medicine specializing in the disorders of the female reproductive system. Modern gynecology deals with menstrual disorders, menopause, infectious disease and maldevelopment of the endoscopy endoscopy Examination of the body's interior through an instrument inserted into a natural opening or an incision, usually as an outpatient procedure. Endoscopes include the upper gastrointestinal endoscope (for the esophagus, stomach, and duodenum), the colonoscope (for the field. 2. Improve productivity in joint operations A general term to describe military actions conducted by joint forces or by Service forces in relationships (e.g., support, coordinating authority) which, of themselves, do not create joint forces. . 3. Develop new products and expand into new markets. This Strategic Plan is well underway and Circon has already established itself as having the world's most comprehensive line of endoscopy products for the urology urology Medical specialty dealing with the urinary system and male reproductive organs. It traces its origin to medieval lithologists, itinerant healers who specialized in surgical removal of bladder stones. and gynecology growth markets. For a more detailed review of the Circon Strategic Plan call for a copy of Circon's 1995 and forthcoming 1996 Annual Reports. -0-
COMPARATIVE SUMMARY OF INCOME
Unaudited, in Millions, Except per Share Data
4th Qtr 3rd Qtr 2nd Qtr 4th Qtr Full Year
1996 1996 1996 1995 1996 1995
U.S. Sales Force $ 30.4 $ 29.9 $ 28.5 $ 27.7 $118.5 $119.0
Other Sales 8.0 8.5 8.6 10.9 35.3 41.4
Total Sales $ 38.4 $ 38.4 $ 37.1 $ 38.6 $153.8 $160.4
Gross Profit 21.7 21.3 20.6 21.3 85.9 87.7(a)
G.P.% 56.6% 55.6% 55.6% 55.1% 55.8% 54.7%
Operating Income
Before Non-Re-
curring Charges $ 2.4 $ 2.4 $ 1.0 $ 2.6 $ 9.3 $ 12.2
Langhorne Facil-
ity Closure 0 0.5 2.1 0 2.6 0
Cabot Business
Integration 0 0 0 0 0 8.4
Operating Income 2.4 1.9 (1.1) 2.6 6.7 3.8
USSC Tender
Offer (0.2) 3.2 0 0 3.0 0
Cabot Trans-
action Costs 0 0 0 0 0 4.9
Interest/Other
Expense, Net 0.7 1.0 0.9 1.2 3.7 4.9
Income Before
Taxes 1.9 (2.3) (2.1) 1.4 (0.0) (6.0)
Income Taxes
(Benefit) 0.7 (0.8) (0.8) 0.4 (0.1) (0.6)
NOL (Benefit) 0 0 (2.0) 0 (2.0) 0
Net Income $ 1.2 $ (1.5) $ 0.7 $ 1.0 $ 2.1 $ (5.4)
Shares
Outstanding 13,712 13,431 13,037 13,397 13,339 13,237
Earnings per
Share $0.09 $ (0.11) $ 0.05 $ 0.08 $ 0.16 $(0.41)
(a) Excludes non-recurring charge
CONDENSED BALANCE SHEET
Unaudited, in Millions
Dec. 31 Dec. 31
1996 1995
Cash and Equivalents $ 8.3 $ 24.1
Total Current Assets 81.1 90.8
All Other Assets, Net 87.5 90.6
Total Assets $168.6 $ 181.4
Total Current Liabilities $ 20.5 $ 35.5
Total Long-Term Debt 50.6 56.4
All Other Liabilities, Net 0.4 2.3
Shareholders' Equity 97.1 87.2
Total Liabilities and
Shareholders' Equity $168.6 $ 181.4
-0- This report may contain 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. . Such forward-looking statements involve risks, uncertainties and other factors that may cause the actual results, performance, cost savings or achievements of the company to be materially different from those expressed or implied by such forward-looking statements. Circon refers you to the documents the company has filed with the Securities & Exchange Commission and particularly the company's 10-Q for the third quarter 1996 where many of these risks are discussed. CONTACT: Circon Corp. R. Bruce Bruce, Scottish royal family descended from an 11th-century Norman duke, Robert de Brus. He aided William I in his conquest of England (1066) and was given lands in England. Thompson Thompson, city, Canada Thompson, city (1991 pop. 14,977), central Man., Canada, on the Burntwood River. A mining town, it developed after large nickel deposits were discovered in the area in 1956. , 805/685-5100 |
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