IRIDEX Reports Second Quarter 2010 Financial Results
-- Sixth consecutive quarter of operating income
-- Cash flow positive from operations
-- Net income of $0.8 million or $0.08 per diluted share
MOUNTAIN VIEW, Calif., Aug. 5 /PRNewswire-FirstCall/ -- IRIDEX Corporation (Nasdaq: IRIX) today reported financial results for the second quarter ended July 3, 2010.
For the second quarter ended July 3, 2010, IRIDEX reported revenue of $9.9 million compared to $10.5 million for the comparable quarter of the previous year. Net income was $0.8 million, or $0.08 per diluted share, for the second quarter of 2010, compared with net income of $1.2 million, or $0.12 per diluted share for the second quarter of 2009. For the six months ended July 3, 2010, the Company reported revenue of $20.6 million and net income of $1.3 million, or $0.13 per diluted share, compared to $21.2 million and net income of $1.4 million, or $0.14 per diluted share for the six months ended July 4, 2009.
"Our second quarter performance was mixed. Excluding OEM revenue our Ophthalmology business was up from $7.2 million in the second quarter of 2009 to $7.4 million this quarter driven by strong international sales. We saw good sales of our IQ 577 Laser System with demand increasing and we launched our IQ 532 Laser System," stated Mr. Theodore A. Boutacoff, President and CEO.
"This was our sixth successive quarter of operating income and we continued to generate positive cash flows from operations, which given our weaker than anticipated revenues illustrates the progress we have made in creating an efficient business operation. The main weakness in our revenues came from our international Aesthetics sales as a consequence of the European economic crisis. International Aesthetics sales for the second quarter 2010 were $0.7 million lower than in the second quarter of 2009."
"A highlight in the quarter was closing the RetinaLabs acquisition and subsequent to the quarter end, we were granted a patent for our Adjustable Laser Probe, both significant steps to help grow our consumables revenues and in the execution of our stated growth strategy, which is a combination of organic initiatives and accretive acquisitions."
"Looking forward, sales in some segments of the market are historically lighter during the summer months; therefore we anticipate third quarter revenue to be between $10.0 million to $10.2 million, gross margins between 45% to 48% and operating expenses between $4.3 million and $4.5 million."
Conference Call
IRIDEX management will conduct a conference call later today, Thursday, August 5, 2010 at 5:00 p.m. Eastern Time. Interested parties may access the live conference call via telephone by dialing (877) 941-1466 (U.S.) or (480) 629-9678 (International) and quoting Conference ID 4336037, or by visiting the Company's website at www.iridex.com. A telephone replay will be available beginning on Thursday, August 5, 2010 through Thursday, August 12, 2010 by dialing (800) 406-7325 (U.S.) or (303) 590-3030 (International) and entering Access Code 4336037. In addition, later today an archived version of the webcast will be available on the Company's website at www.iridex.com.
About IRIDEX
IRIDEX Corporation was founded in 1989 and is a worldwide leader in developing, manufacturing, and marketing innovative and versatile laser-based medical systems and delivery devices. We provide solutions for multiple specialties, including ophthalmology, dermatology and otolaryngology. We maintain a deep commitment to the success of our customers, with comprehensive technical, clinical, and service support programs. IRIDEX is dedicated to a standard of excellence, offering superior technology for superior results. IRIDEX products are sold in the United States through a direct sales force and internationally through a combination of a direct sales force and a network of approximately 100 independent distributors into 107 countries. For further information, visit the Company's website at http://www.iridex.com.
Safe Harbor Statement
This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934, as amended, relating to the Company's third quarter revenue, gross margins, operating expenses as well as the effect of its acquisition of RetinaLabs and the issuance of a patent on its Adjustable Laser Probe on its consumables revenue. These statements are not guarantees of future performance and actual results may differ materially from those described in these forward-looking statements as a result of a number of factors. Please see a detailed description of these and other risks contained in our Annual Report on Form 10-K for the fiscal year ended January 2, 2010 and our Quarterly Report on Form 10-Q for the first quarter ended April 3, 2010, each of which was filed with the Securities and Exchange Commission. Forward-looking statements contained in this announcement are made as of this date and will not be updated.
IRIDEX Corporation Condensed Consolidated Statements of Operations (In thousands, except per share data) (unaudited) | ||||||||
Three Months Ended | Six Months Ended | |||||||
July 3, | July 4, | July 3, | July 4, | |||||
2010 | 2009 | 2010 | 2009 | |||||
Revenues | $ 9,890 | $ 10,513 | $ 20,648 | $ 21,249 | ||||
Cost of revenues | 5,354 | 5,684 | 10,887 | 11,372 | ||||
Gross profit | 4,536 | 4,829 | 9,761 | 9,877 | ||||
Operating expenses: | ||||||||
Research and development | 966 | 906 | 1,993 | 1,747 | ||||
Sales and marketing | 2,327 | 2,211 | 4,665 | 4,562 | ||||
General and administrative | 1,108 | 1,313 | 2,365 | 2,806 | ||||
Total operating expenses | 4,401 | 4,430 | 9,023 | 9,115 | ||||
Income from operations | 135 | 399 | 738 | 762 | ||||
Legal settlement | 800 | 800 | 800 | 800 | ||||
Interest and other income (expense), net | (50) | 6 | (112) | (133) | ||||
Income before income taxes | 885 | 1,205 | 1,426 | 1,429 | ||||
Provision for income taxes | 71 | 7 | 127 | 7 | ||||
Net income | $ 814 | $ 1,198 | $ 1,299 | $ 1,422 | ||||
Net income per share - basic | $ 0.09 | $ 0.13 | $ 0.15 | $ 0.16 | ||||
Net income per share - diluted | $ 0.08 | $ 0.12 | $ 0.13 | $ 0.14 | ||||
Shares used in computing net income per share - basic | 8,965 | 8,844 | 8,907 | 8,835 | ||||
Shares used in computing net income per share - diluted | 10,197 | 10,107 | 10,094 | 9,966 | ||||
IRIDEX Corporation Condensed Consolidated Balance Sheets (In thousands) (unaudited) | ||||
July 3, | January 2, | |||
2010 | 2010 | |||
Assets | (unaudited) | |||
Current Assets: | ||||
Cash and cash equivalents | $ 7,000 | $ 9,378 | ||
Accounts receivable, net | 6,616 | 7,482 | ||
Inventories, net | 9,479 | 8,999 | ||
Prepaids and other current assets | 552 | 470 | ||
Total current assets | 23,647 | 26,329 | ||
Property and equipment, net | 386 | 486 | ||
Other long-term assets | 250 | 323 | ||
Other intangible assets, net | 1,892 | 1,153 | ||
Goodwill | 473 | - | ||
Total assets | $ 26,648 | $ 28,291 | ||
Liabilities and Stockholders' Equity | ||||
Current Liabilities: | ||||
Accounts payable | $ 2,013 | $ 1,872 | ||
Bank line of credit | - | 3,520 | ||
Accrued compensation | 1,691 | 2,171 | ||
Accrued expenses | 1,584 | 1,983 | ||
Accrued warranty | 1,150 | 1,165 | ||
Deferred revenue | 2,266 | 2,405 | ||
Total current liabilities | 8,704 | 13,116 | ||
Long Term Liabilities: | ||||
Other long-term liabilities | 573 | 149 | ||
Total liabilities | 9,277 | 13,265 | ||
Stockholders' Equity: | ||||
Convertible preferred stock | 5 | 5 | ||
Common Stock | 89 | 89 | ||
Additional paid-in capital | 40,859 | 39,820 | ||
Accumulated other comprehensive loss | (205) | (212) | ||
Treasury stock, at cost | (430) | (430) | ||
Accumulated deficit | (22,947) | (24,246) | ||
Total stockholders' equity | 17,371 | 15,026 | ||
Total liabilities and stockholders' equity | $ 26,648 | $ 28,291 | ||
SOURCE IRIDEX Corporation
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