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 MINNEAPOLIS, Sept. 20 /PRNewswire/ -- SCIMED Life Systems, Inc. (NASDAQ-NMS: SMLS) announced net earnings of $15,014,000, or $.97 per share, for the second quarter of Fiscal 1994, ending Aug. 31, 1993, compared with earnings of $11,963,000, or $.79 per share, for the same period last year. Net sales for the quarter were a record $67,735,000, an increase of 25 percent compared with net sales of $54,386,000 last year.
 International sales increased by more than 50 percent, and U.S. sales increased by more than 15 percent, compared to last year. International sales were favorably impacted by the conversion earlier this year from distributors to direct sales operations in Germany and the United Kingdom as well as the impact of revenues from contract manufacturing in SCIMED's Belgian facility.
 Selling, general and administrative expenses increased 44 percent over the prior year due primarily to the establishment of direct sales operations in Germany and the U.K. and the expenses of establishing operations in Japan for conversion to a direct sales operation on Jan. 1, 1994.
 As previously announced, the Company has set up a reserve against orders from its Japanese distributor. This reduced second quarter revenues by $2.6 million and could reduce third quarter revenues by as much as $5 to $8 million. In addition, legal expenses are expected to increase in the third quarter due primarily to commencement of a trial on Sept. 27 in patent litigation with subsidiaries of Pfizer, Inc. involving the Company's EXPRESS(R) and RALLY(R) catheters.
 Dale A. Spencer, president and chief executive officer, commented, "During the second quarter, we continued our commitment to follow our strategic direction of strengthening our worldwide market share and increasing SCIMED's international presence by investing in the development of a direct sales organization in parts of Europe and in Japan. While we will continue to incur additional expenses as we further develop our international organization and strengthen our worldwide market position, we firmly believe that our investments will result in increased worldwide market share, as well as increased revenues and earnings, long term."
 SCIMED Life Systems, Inc. develops, manufactures and markets disposable medical devices, principally coronary and peripheral angioplasty products, for non-surgical treatment of cardiovascular disease. SCIMED's shares are traded on the NASDAQ National Market System under the symbol SMLS.
 Three Months Ended
 8/31/93 8/31/92
 Net Sales $67,735,000 $54,386,000
 Cost of Sales 14,003,000 12,036,000
 Gross Profit 53,732,000 42,350,000
 Operating Expenses:
 Selling, General and Administrative 21,687,000 15,075,000
 Royalties 4,079,000 5,495,000
 Research and Development 5,396,000 4,223,000
 Operating Profit 22,570,000 17,557,000
 Interest Income 1,069,000 900,000
 Interest Expense 142,000 258,000
 Other Income (Expense), net (43,000) 348,000
 Earnings Before Income Taxes 23,454,000 18,547,000
 Income Taxes 8,440,000 6,584,000
 Net Earnings $15,014,000 $11,963,000
 Earnings Per Common Share $.97 $.79
 Weighted Average Number of Common and
 Common Equivalent Shares Outstanding 15,551,000 15,202,000
 Six Months Ended
 8/31/93 8/31/92
 Net Sales $133,571,000 $105,650,000
 Cost of Sales 27,958,000 22,978,000
 Gross Profit 105,613,000 82,672,000
 Operating Expenses:
 Selling, General and Administrative 39,017,000 30,257,000
 Royalties 10,215,000 10,675,000
 Research and Development 10,523,000 8,270,000
 Operating Profit 45,858,000 33,470,000
 Interest Income 2,108,000 1,775,000
 Interest Expense 280,000 512,000
 Other Income (Expense), net (139,000) 369,000
 Earnings Before Income Taxes 47,547,000 35,102,000
 Income Taxes 17,355,000 12,461,000
 Net Earnings $30,192,000 $22,641,000
 Earnings Per Common Share $1.96 $1.49
 Weighted Average Number of Common and
 Common Equivalent Shares Outstanding 15,418,000 15,220,000
 8/31/93 2/28/93
 Cash and Cash Equivalents $68,650,000 $73,750,000
 Marketable Securities 44,770,000 38,120,000
 Accounts Receivable, net 33,843,000 31,100,000
 Inventories 11,778,000 8,573,000
 Other Current Assets 10,804,000 9,044,000
 Total Current Assets 169,845,000 160,587,000
 Property, Plant and Equipment, net 40,264,000 28,428,000
 Equity Investments 11,986,000 11,986,000
 Intangible Assets 36,502,000 26,026,000
 Other Assets, net 3,360,000 2,883,000
 -- $261,957,000 $229,910,000
 Current Liabilities $42,539,000 $44,089,000
 Other Non-Current Liabilities 328,000 302,000
 Shareholders' Equity 219,090,000 185,519,000
 -- $261,957,000 $229,910,000
 -0- 9/20/93
 /CONTACT: Karen J. Kelsey, SCIMED director of investor and public relations, 612-494-2329/

CO: SCIMED Life Systems, Inc. ST: Minnesota IN: MTC SU: ERN

KH-AL -- MN002 -- 3464 09/20/93 08:23 EDT
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Publication:PR Newswire
Date:Sep 20, 1993

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