Cytyc Reports Record Revenue and EPS; U.S. Market Share Exceeds 50 Percent Third Quarter Revenue Grows to $57 Million.Business Editors BOXBOROUGH, Mass.--(BUSINESS WIRE)--Oct. 24, 2001 Cytyc Cytyc Corporation (NASDAQ: CYTC) engages in the design, development, manufacture, and marketing of clinical products that focus on women’s health. Its products cover a range of women's health applications, including cervical cancer screening, breast cancer risk Corporation (Nasdaq:CYTC) today reported record revenue and earnings for the third quarter ended September September: see month. 30, 2001. The Company also announced that its estimated share of the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. Pap test Pap test, Pap smear, or Papanicolaou test (păp'ənē`kəlou), medical procedure used to detect cancer of the uterine cervix. market increased to approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 51 percent in the third quarter. Revenue for the third quarter was $57.2 million, an 8 percent increase from the $53 million reported in the second quarter of 2001 and a 54 percent increase from the $37 million reported in the comparable quarter last year. Assuming a theoretical tax rate of 40 percent, pro-forma net income for the third quarter was $14.6 million, or $0.12 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared to a fully taxed pro-forma net income of $13 million, or $0.11 per diluted share, in the second quarter of 2001. Fully taxed pro-forma net income in the comparable quarter last year was $6.8 million, or $0.06 per diluted share. Reported net income for the quarter was $18.0 million, or $0.15 per diluted share, compared to $16 million, or $0.13 per diluted share, in the second quarter of 2001, and $11.0 million, or $0.09 per diluted share, in the third quarter of 2000. For the nine months ended September 30, 2001, revenues grew 58 percent to $157.7 million compared to revenue of $99.5 million for the same period in 2000. The Company reported net income of $49.6 million, or $0.41 per diluted share for the first nine months of 2001 compared to net income of $23.4 million, or $0.20 per diluted share for the same period last year. Net income for the nine months ended September 2001 includes a $3 million 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. settlement. "We believe the superior clinical performance of the ThinPrep ThinPrep™ Cytology A proprietary system–Cytec, Inc, in which specimens are obtained with a special fluid collection system and the slides for cytologic examination are spread in one-cell-thick layers. See thin prep. (R) Pap Test(TM) and the effectiveness of our sales and marketing strategy have provided Cytyc with consistent revenue and earnings growth and financial performance," said Patrick J. Sullivan, Cytyc's president and chief executive officer. "Last week we announced that Cytyc has entered into a definitive merger agreement to acquire Pro-Duct Health, Inc., an acquisition that we expect will expand our product line to include breast cancer and provide an excellent opportunity for significant revenue and earnings growth." Cytyc management will discuss results of the third quarter and future expectations during a conference call on October October: see month. 24, 2001, at 5:00 p.m. (Eastern). A webcast and a replay of the call may be accessed at Cytyc's web site, www.cytyc.com, where the event will be available for replay approximately two hours following the webcast. Those without web access may access the call by calling 800-374-0727 or 706-634-2339. A telephonic replay of the call will be available through October 31, 2001, by calling 800-642-1687 (Access Code: 2076654) or 706-645-9291 (Access Code: 2076654). In connection with the adoption of the SEC rules on corporate disclosure, Cytyc is publishing its procedures for announcing its future expectations for the Company. Towards the end of each fiscal quarter, Cytyc will have a "Quiet Period" when it will not comment concerning its financial results or expectations. The Quiet Period will extend until Cytyc's next quarterly earnings release is published and the conference call takes place. For the fourth quarter of 2001, the Quiet Period will be December December: see month. 16, 2001, through approximately January January: see month. 31, 2002. Cytyc Corporation develops, manufactures, and markets the ThinPrep(R) System for medical diagnostic applications. The ThinPrep System consists of the ThinPrep(R) 2000 Processor, ThinPrep(R) 3000 Processor, and related reagents, filters, and other supplies. Cytyc(R), and ThinPrep(R) are registered trademarks and ThinPrep(R) Pap Test(TM) is a trademark of Cytyc Corporation. 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. in this press release are made pursuant to the provisions of Section 21E of the Securities Exchange Act of 1934. Investors are cautioned that statements in this press release which are not strictly historical statements, including, without limitation, statements regarding management's expectations for future growth, profitability, product development and results, and objectives and expectations regarding future management and operations, including without limitation statements regarding the Pro-Duct Health acquisition, constitute forward-looking statements. These statements are based on current expectations, forecasts and assumptions that are subject to risks and uncertainties which could cause actual outcomes and results to differ materially from those statements. Risks and uncertainties include, among others, risks associated with the consummation CONSUMMATION. The completion of a thing; as the consummation of marriage; (q.v.) the consummation of a contract, and the like. 2. A contract is said to be consummated, when everything to be done in relation to it, has been accomplished. and integration of the acquisition of Pro-Duct, including, without limitation, the failure to obtain regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. and shareholder approval, product development and marketing challenges, dependence on proprietary technology, dependence on timely and adequate levels of third-party reimbursement Reimbursement Payment made to someone for out-of-pocket expenses has incurred. , dependence on key personnel, management of growth and limited number of customers and lengthy sales cycle, as well as risks of downturns in economic conditions generally, and in the healthcare industry specifically, risks associated with competition and competitive pricing pressures, and other risks detailed in the Company's filings with the Securities and Exchange Commission including under the heading "Certain Factors Which May Affect Future Results" in its 2000 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. filed with the Commission. In addition, revenues and earnings in the medical device industry are subject to fluctuation Fluctuation A price or interest rate change. , and the growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. recently experienced by the Company do not necessarily represent future operating results. The Company cautions readers not to place undue reliance on any such forward-looking statements, which speak only as of the date they were made. The Company disclaims any obligation to publicly update or revise any such statements to reflect any change in Company expectations or events, conditions, or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.
Cytyc Corporation
Consolidated Balance Sheets
(in thousands)
September 30, December 31,
2001 2000
Assets:
Current assets
Cash and short-term investments $ 152,046 $ 88,845
Accounts receivable, net 49,092 40,214
Inventories 10,557 11,093
Other current assets 1,637 937
Total current assets 213,332 141,089
Property and equipment, net 24,081 21,363
Other assets, net 21,964 8,434
Total Assets $ 259,377 $ 170,886
Liabilities and Stockholders' Equity:
Current liabilities $ 23,524 $ 23,840
Stockholders' equity:
Capital stock 223,519 184,783
Accumulated other comprehensive loss (151) (632)
Retained earnings (deficit) 12,485 (37,105)
Total stockholders' equity 235,853 147,046
Total Liabilities and Stockholders' Equity $ 259,377 $ 170,886
Cytyc Corporation
Consolidated Statements of Operations
(in thousands, except per share data)
Three Months Ended Nine Months Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2001 2000 2001 2000
Net sales $ 57,249 $ 37,209 $157,713 $ 99,512
Cost of sales 10,466 5,866 28,746 17,285
Gross profit 46,783 31,343 128,967 82,227
Operating expenses:
Research and development 5,369 3,462 15,406 10,653
Sales and marketing 14,496 14,264 42,849 41,145
General and administrative 4,015 3,539 11,014 9,784
Total operating expenses 23,880 21,265 69,269 61,582
Income from operations 22,903 10,078 59,698 20,645
Other income, net:
Interest income 1,463 1,263 4,304 3,323
Litigation settlement -- -- 3,087 --
Total other income, net 1,463 1,263 7,391 3,323
Income before provision
for income taxes 24,366 11,341 67,089 23,968
Provision for income taxes 6,335 346 17,499 592
Net income $ 18,031 $ 10,995 $ 49,590 $ 23,376
Net income per common and
potential common share
Basic $ 0.16 $ 0.10 $ 0.43 $ 0.21
Diluted $ 0.15 $ 0.09 $ 0.41 $ 0.20
Weighted average common and
potential common shares
outstanding:
Basic 115,698 111,585 114,685 110,220
Diluted 120,918 118,311 119,953 117,777
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