American Medical Tops Estimates - Analyst Blog
04 Maggio 2011 - 5:32PM
Zacks
Leading pelvic-health devices provider American Medical
Systems (AMMD) reported first-quarter fiscal 2011 adjusted
(excluding one-time items such as amortization charges) earnings
per share of 33 cents, beating the Zacks Consensus Estimate of 30
cents and surpassing the year-ago adjusted earnings of 29
cents.
The results were ahead of the Minnesota-based company’s guidance
range of 29 cents and 32 cents.
Besides, amortization charges, adjusted earnings also exclude
the start-up expenses associated with transition of manufacturing
operations to the company’s new facility in Ireland. Profit (as
reported) for the quarter climbed 4.4% year over year to $21.6
million (or 27 cents a share).
Revenues and Margins
Revenues for the quarter moved up 4.3% year over year to $140.8
million, above the Zacks Consensus Estimate of $137 million and the
company’s guidance of $135 and $139 million.
Excluding currency exchange translation and the impact of the
divested Her Option uterine health product line, sales grew 5.4%.
Revenue growth in the quarter was driven by higher sales across the
company’s Men’s Health and Women’s Health businesses.
Gross margin declined narrowly to 84.3% from 84.4% a year-ago.
Operating margin increased to 29% from 27% in the earlier-year
quarter.
Results by Segments
Revenues from American Medical’s Men’s Health business rose 4.5%
year over year to $67.4 million as its male continence product line
performed well in the quarter.
BPH Therapy sales spiked 8.3% to $28.1 million, led by the
company’s GreenLight XPS laser therapy and the new BPH therapy
system, MoXy Liquid Cooled Fiber. In Women’s Health business,
revenues jumped 6% year over year to $45.3 million, driven by the
sustained healthy performance of pelvic floor repair products
buoyed by the success of Elevate anterior and Elevate posterior
systems.
Geographically, the U.S. sales rose 3.3% year over year to $99.7
million, representing 71% of total sales
while international revenues (up 12.3% to $41.1 million) accounted
for the balance.
Balance Sheet and Cash Flow
American Medical ended the quarter with cash and short-term
investments of $110 million, up 84% year over year. Total debt and
other long-term liabilities declined roughly 17% year over year to
$320.6 million. American Medical generated $33.2 million in cash
from operations during the quarter, a roughly 25% year over year
increase.
Endo Pharmaceuticals Deal
American Medical is slated to be acquired by specialty
healthcare solutions company Endo Pharmaceuticals
(ENDP) in the third quarter of 2011. Under the deal, announced in
April 2011, Endo Pharmaceuticals will buy American Medical for $2.9
billion or $30.00 per share in cash.
The consideration includes the assumption of $312 million of
debt. The deal has been approved by the Boards of both
companies and is subject to the approval of American Medical’s
shareholders, antitrust clearance and attainment of other closing
conditions.The company will announce a special shareholder meeting
in due course to secure stockholder clearance of the proposed deal.
Currently, we have a Neutral rating on American Medical.
AMER MED SYS (AMMD): Free Stock Analysis Report
ENDO PHARMACEUT (ENDP): Free Stock Analysis Report
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