Merit Medical Reports Record Net Income and Sales for the Year Ended December 31, 2002 and Gives Guidance for 2003.Business Editors & Health/Medical Writers SOUTH JORDAN, Utah--(BUSINESS WIRE)--Feb. 19, 2003 Merit Medical Systems, Inc. (Nasdaq:MMSI MMSI Maritime Mobile Service Identity MMSI Miniature Munitions/Store Interface MMSI Military Membership Status Identifier ) a manufacturer and marketer of proprietary disposable products Disposable products are items that are not intended by the manufacturer to be reused more than once or a few times as compared to more permanent serviceable and reusable items. Some products that have disposable versions are:
Medical specialty dealing with heart diseases and disorders. It began with the 1749 publication by Jean Baptiste de Sénac of contemporary knowledge of the heart. Diagnostic methods improved in the 19th century, and in 1905 the electrocardiograph was invented. and radiology radiology, branch of medicine specializing in the use of X rays, gamma rays, radioactive isotopes, and other forms of radiation in the diagnosis and treatment of disease. procedures, reported record net income of $11.3 million, or $0.77 per share, for the year ended December 31, 2002, compared with $6.7 million, or $0.50 per share in 2001, a gain of 69 percent. Revenues for 2002 were a record $116.2 million compared with $104 million for the same period in 2001, a gain of 12 percent. Net income for the fourth quarter ended December 31, 2002, was $3.2 million, or $0.21 per share, compared with $1.9 million, or $0.13 per share, in the 2001 fourth quarter, a gain of 62 percent. Revenues for the 2002 fourth quarter were $29.4 million compared with $25.3 million in the fourth quarter of 2000, a gain of 16 percent. Every group of the Company's products witnessed growth in 2002 compared to 2001. Both the custom kits and stand-alone products groups rose by 13 percent; followed by inflation devices, which grew by 11 percent; and catheters, which increased 6 percent. For the fourth quarter of 2002, sales of the Company's inflation devices grew by 20 percent; stand-alone products sales rose 19 percent, custom kits sales grew by 18 percent; and catheter catheter /cath·e·ter/ (kath´e-ter) 1. a tubular, flexible surgical instrument that is inserted into a cavity of the body to withdraw or introduce fluid. 2. urethral c. sales declined by 3 percent compared to the fourth quarter of 2001. Fred P. Lampropoulos, Chairman 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 Merit, said, "We continued our improved performance last year in terms of employee productivity gains, inventory reduction, new product introductions, gross margin improvements and cash flow. "We were able to reduce our inventory by approximately $2.1 million last year, while growing our revenues by 12 percent. Inventory turns rose from 2.9 times in 2001 to 3.4 times in 2002. All of these positive gains have contributed to a rising cash position. Our cash balance rose to almost $10 million at year-end since we retired our debt in March 2002. Additionally, the Company opted to purchase its Irish facility for $2.6 million in cash. "In 2003, we will continue to see productivity gains, benefits from cost-savings programs, and benefits from new product introductions. Costs will rise this year in a number of areas, including $400,000 in health care premiums which the Company is absorbing rather than passing on to our employees, a 23 percent rise in property and casualty insurance premiums due to the combination of the increased value of our business and rate increases, and a much higher income tax rate for 2003," Mr. Lampropoulos continued. The Company's gross margin improved to 41.7 percent in 2002 compared with 36.6 percent in 2001. This rise was due largely to employee productivity improvements. In addition, the implementation during 2001 and 2002 of cost-saving programs throughout the organization contributed importantly to the margin gains. Gross margin for the fourth quarter ended December 31, 2002, was 43.4 percent compared with 38.5 percent in the fourth quarter of 2001. Total operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. for 2002 grew slightly as a percent of sales to 27.3 percent compared with 27.1 percent in 2001. Selling, general and administrative expenses rose 15.4 percent, largely due to increases in commissions paid commensurate com·men·su·rate adj. 1. Of the same size, extent, or duration as another. 2. Corresponding in size or degree; proportionate: a salary commensurate with my performance. 3. with sales growth, as well as the addition of personnel in the sales and marketing organizations. Research and development expenditures in dollars were essentially flat in 2002 compared with 2001. Income before income tax expense rose by 71 percent to $16.8 million in 2002 compared with $9.8 million in 2001. Due to this increase, the Company's income-tax rate rose to 32.5 percent in 2002 compared to 31.2 percent in 2001. It is expected that the Company's income-tax rate will rise more rapidly in 2003 to approximately 35.5 percent. Merit also said it expects revenues and earnings per share for the year ended December 31, 2003, to be in the range of $126.9 million-$129.0 million, and $0.87-$0.93, respectively.
INCOME STATEMENT
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3 Mos. Ended 12/31 12 Mos. Ended 12/31
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2002 2001 2002 2001
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(In Thousands Except Share Data)
REVENUES $29,425 $25,289 $116,227 $104,036
COST OF SALES 16,651 15,562 67,712 65,938
GROSS PROFIT 12,774 9,727 48,515 38,098
OPERATING EXPENSES:
Selling, General and
Administration 7,078 5,825 27,732 24,041
Research and
Development 1,132 953 4,008 4,118
TOTAL OPERATING
EXPENSES 8,210 6,778 31,740 28,159
OPERATING INCOME 4,564 2,949 16,775 9,939
OTHER EXPENSE -
(INCOME) (63) 52 13 151
PRETAX INCOME 4,627 2,897 16,762 9,788
INCOME TAX EXPENSE 1,471 951 5,452 3,052
NET INCOME 3,156 1,946 11,310 6,736
EARNINGS PER COMMON
SHARE-
Basic: $0.23 $0.15 $0.83 $0.53
Diluted: $0.21 $0.13 $0.77 $0.50
AVERAGE COMMON SHARES-
Basic: 13,827,780 13,315,085 13,627,178 12,677,611
Diluted: 14,954,141 14,436,486 14,759,128 13,429,585
BALANCE SHEET
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12/31/02 12/31/01
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(In $ Thousands)
ASSETS
CASH $9,684 $342
TRADE RECEIVABLES (NET) 15,247 14,748
INVENTORIES 18,699 20,824
OTHER CURRENT ASSETS 4,166 1,688
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TOTAL CURRENT ASSETS 47,796 37,602
PROPERTY & EQUIPMENT (NET) 25,412 21,823
OTHER ASSETS 6,726 7,234
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TOTAL ASSETS $79,934 $66,659
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LIABILITIES AND STOCKHOLDERS' EQUITY
TOTAL CURRENT LIABILITIES $11,586 $10,690
OTHER LIABILITIES 4,933 2,583
LONG-TERM DEBT 16 5,727
STOCKHOLDERS' EQUITY 63,399 47,659
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TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $79,934 $66,659
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CONFERENCE CALL Merit Medical Systems, Inc. invites all interested parties to join its officers in their quarterly earnings conference call and 2003 guidance to be held today, February 19, 2003, at 4:15 PM Eastern Time (3:15 PM Central, 2:15 PM Mountain, and 1:15 PM Pacific). During the conference call, the results of operations for the year and quarter ended December 31, 2002 will be discussed in more detail, together with the Company's expectations for 2003 and trends that may affect its future results. The telephone numbers are: Domestic: 800/218-0713, and International: 303/262-2190. A rebroadcast is available through August 20, 2003, on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the by accessing the CCBN CCBN Central Coast Bancorp CCBN Charles County Business Network logo under "Webcasts" at www.merit.com. The rebroadcast is also available through August 20, 2003 at www.ccbn.com. ABOUT MERIT Founded in 1987, Merit Medical Systems, Inc. is 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. engaged in the development, manufacture and distribution of proprietary disposable disposable Nursing adjective Referring to that which is discarded or disposed of noun An item used in health care-related Pt contact which is discarded after use–eg masks, gloves, gowns, needles, paper products, syringes, wipes. See Biohazardous waste. medical products used in interventional and diagnostic procedures, particularly in cardiology and radiology. The Company serves client hospitals worldwide with a domestic and international sales force totaling approximately 70 individuals. Merit employs approximately 1,070 individuals worldwide, with manufacturing facilities in South Jordan and Salt Lake City, Utah For ships of the United States Navy of the same name, see . Salt Lake City is the capital and the most populous city of the U.S. state of Utah. The name of the city is often shortened to Salt Lake, or its initials, S.L.C. ; Santa Clara, California Santa Clara, California (IPA: /ˌsæntəˈklærə/) , founded in 1777 and incorporated in 1852, is a city in Santa Clara County, in the U.S. state of California. ; Angleton, Texas
Angleton is the county seatGR6 of Brazoria County in the U.S. ; and Galway, Ireland. For more information about Merit, visit www.merit.com. Statements contained in this release which are not purely historical are 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. within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 and are subject to risks and uncertainties such as those described in the Company's 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 December 31, 2001. Such risks and uncertainties include introduction of products in a timely fashion, market acceptance of new products, cost increases, fluctuations in and obsolescence ob·so·les·cent adj. 1. Being in the process of passing out of use or usefulness; becoming obsolete. 2. Biology Gradually disappearing; imperfectly or only slightly developed. of inventory, price and product competition, availability of labor and materials labor and materials (time and materials) n. what some builders or repair people contract to provide and be paid for, rather than a fixed price or a percentage of the costs. , development of new third-party products and techniques that render the Company's products obsolete OBSOLETE. This term is applied to those laws which have lost their efficacy, without being repealed, 2. A positive statute, unrepealed, can never be repealed by non-user alone. 4 Yeates, Rep. 181; Id. 215; 1 Browne's Rep. Appx. 28; 13 Serg. & Rawle, 447. , delays in obtaining regulatory approvals, potential product recalls, foreign currency fluctuations, changes in health care markets related to health care reform initiatives, 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. and other factors referred to in the Company's 10-K and other reports filed with the Securities and Exchange Commission. All subsequent forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety The whole, in contradistinction to a moiety or part only. When land is conveyed to Husband and Wife, they do not take by moieties, but both are seised of the entirety. by these cautionary statements. Actual results may differ materially from anticipated results. Financial estimates are subject to change and are not intended to be relied upon as predictions of future operating results. |
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