(Source: Business Wire)
Home
Diagnostics, Inc. (Nasdaq:HDIX), a leading manufacturer and
marketer of diabetes testing supplies, today announced financial results
for the third quarter ended September 30, 2009.
Total revenue for the third quarter was $34.5 million, a decrease of
3.0% from $35.6 million in the third quarter of 2008. Retail channel
sales increased 8.3%, driven by the continued national rollout of the
TRUEresult® and TRUE2go blood glucose monitoring systems and an
expanded product offering at Walmart. Mail service channel sales
increased 14.4% as a result of the continued success of the private
label, no-code blood glucose system offered through Liberty Medical and
our other mail service providers who promote the TRUEbalance no-code
blood glucose system. Distribution channel sales decreased 16.9% as a
result of customers' continued focus on reducing inventory days supply
on hand. International sales increased 19.8%, driven primarily by the
launch of TRUEbalance in several European markets.
Gross profit for the third quarter of 2009 was $17.9 million, compared
to $21.6 million in the third quarter of 2008. As a percentage of sales,
gross margin decreased to 51.8% compared to 60.8% in the prior year
period. As the Company previously guided, gross margin was negatively
impacted by the continued investment in the roll out of the new no-code
products in the retail and mail service channels. Gross margin was also
impacted by lower pricing in the mail service and distribution channels.
Selling, general and administrative expenses were $11.6 million for the
third quarter of 2009, compared with $13.4 million in the third quarter
of 2008. The decrease in selling, general and administrative expenses
was primarily due to lower sales and marketing expenses following the
initial launch of the TRUE2go and TRUEresult systems last year and cost
reduction initiatives.
Research and development expenses were $2.1 million for the third
quarter of 2009, compared with $2.0 million in the third quarter of 2008.
Operating income for the third quarter of 2009 was $4.2 million,
compared to operating income of $6.2 million for the third quarter of
2008.
For the three-month period ended September 30, 2009, the Company
reported net income of $2.9 million, or $0.17 per diluted share, based
on weighted average shares outstanding of 17.6 million. Net income for
the three-month period ended September 30, 2008 was $4.5 million, or
$0.24 per diluted share, based on 18.8 million weighted average shares
outstanding.
Joseph Capper, President and Chief Executive Officer of Home
Diagnostics, said, "We are pleased with the results in the retail and
mail service channels, underscoring the success of our new no-code
products and marketing initiatives. Importantly, we continue to gain
domestic market share, driven by the demand for our high-quality and
value-priced blood glucose monitoring TRUE-family of products.
International business was up 20% for the quarter. Our focus on
operating cost controls contributed to solid bottom line results. We are
encouraged by increased demand for our products reflected by record
outsales in the distribution and retail channels. Accordingly, we are on
schedule to triple our manufacturing capacity to support this growing
demand for TRUEtest. This investment, along with a focus on well
defined strategic initiatives, positions us well to achieve sales growth
in all of our business channels in 2010."
2009 Financial Guidance
Based on the third quarter 2009 results and challenging market
conditions, specifically in the distribution channel, the Company is
adjusting its full year 2009 guidance. It now expects total revenue to
be in the range of $126 million to $127 million and diluted earnings per
share to be in the range of $0.30 to $0.32 from the previous estimate of
$129 million to $131 million and diluted earnings per share in the range
of $0.36 to $0.38.
Conference Call
Home Diagnostics will hold a conference call on Thursday, November 5,
2009 at 8:30 a.m. ET to discuss its operating results. The dial-in
numbers are 1-877-407-0789 for domestic callers and 1-201-689-8562 for
international callers. A live Webcast of the conference call will be
available online from the investor relations page of the Company's
corporate Website at www.homediagnostics.com.
After the live Webcast, the call will remain available on Home
Diagnostics' Website, www.homediagnostics.com,
through December 5, 2009. In addition, a telephonic replay of the call
will be available until November 12, 2009. The replay dial-in numbers
are 1-877-660-6853 for domestic callers and 1-201-612-7415 for
international callers. Please use account number 3055 and conference ID
number 334965.
About Home Diagnostics, Inc.
Based in Fort Lauderdale, Florida, Home Diagnostics, Inc. (NASDAQ: HDIX)
is a leading developer, manufacturer and marketer of diabetes management
products. Home Diagnostics, Inc. offers a portfolio of high-quality
blood glucose monitoring systems that spans the spectrum of features and
benefits to help every person with diabetes better monitor and manage
their disease. The Home Diagnostics, Inc. product line includes
TRUE2go, TRUEresult®, TRUEtrack®, TRUEbalance, Sidekick®, TRUEread®
and Prestige IQ® blood glucose monitoring systems. The products are
available in more than 45,000 pharmacies throughout the U.S. Home
Diagnostics is the exclusive co-brand supplier of blood glucose
monitoring systems for leading pharmacies including CVS, Rite Aid and
Walgreens, as well as distributors such as AmerisourceBergen, Cardinal
Health, McKesson, Invacare and Liberty Medical. Home Diagnostics, Inc.
was named one of Forbes magazine's "200 Best Small Companies" in 2008,
and in 2009 received several recognitions for the company's TRUE2go
blood glucose meter, including a Medical Design Excellence Award (MDEA)
and a Gold Award in the Medical/Test Equipment category as part
of appliance DESIGN Magazine's 22nd Annual Excellence
in Design (EID) Awards Competition. For more information please visit www.homediagnostics.com.
Forward-Looking Statements
The above statements include forward-looking statements and are
subject to risks and uncertainties. Forward-looking statements give the
Company's current expectations and projections relating to its financial
condition, results of operations, plans, objectives, future performance
and business. The statements can be identified by the fact that they do
not relate strictly to historical or current facts. These statements may
include words such as "anticipate," "estimate," "expect," "project,"
"intend," "plan," "believe" and other words and terms of similar meaning
in connection with any discussion of the timing or nature of future
operating or financial performance or other events.
All statements other than statements of historical facts included in
this release that address activities, events or developments that we
expect, believe or anticipate will or may occur in the future are
forward-looking statements.
These forward-looking statements are largely based on our
expectations and beliefs concerning future events, which reflect
estimates and assumptions made by the Company's management. These
estimates and assumptions reflect the Company's best judgment based on
currently known market conditions and other factors relating to the
Company's operations and business environment, all of which are
difficult to predict and many of which are beyond its control.
Although the Company believes its estimates and assumptions to be
reasonable, they are inherently uncertain and involve a number of risks
and uncertainties that are beyond the Company's control. In addition,
management's assumptions about future events may prove to be inaccurate.
Management cautions all readers that the forward-looking statements
contained in this release are not guarantees of future performance, and
the Company cannot assure any reader that those statements will be
realized or the forward-looking events and circumstances will occur.
Actual results may differ materially from those anticipated or implied
in the forward-looking statements due to the factors listed in the "Risk
factors" and "Management's discussion and analysis of financial
condition and results of operations" sections contained in its filings
with the Securities and Exchange Commission. All forward-looking
statements speak only as of the date of this release. The Company does
not intend to publicly update or revise any forward-looking statements
as a result of new information, future events or otherwise, except as
required by law. These cautionary statements qualify all forward-looking
statements attributable to the Company or persons acting on its behalf.
TRUE2go, TRUEresult, TRUEbalance, TRUEtrack, Sidekick, TRUEread,
Prestige IQ, TRUEfill and TRUEtest are trademarks of Home Diagnostics,
Inc. All other trademarks are property of their respective owners.
HOME DIAGNOSTICS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2008 % of Sales 2009 % of Sales 2008 % of Sales 2009 % of Sales
Net sales $ 35,565 100.0 % $ 34,500 100.0 % $ 94,041 100.0 % $ 91,755 100.0 %
Cost of sales 13,936 39.2 % 16,616 48.2 % 37,937 40.3 % 44,973 49.0 %
Gross profit 21,629 60.8 % 17,884 51.8 % 56,104 59.7 % 46,782 51.0 %
Operating expenses:
Selling, general and administrative (including stock-based compensation expense of $665 and $522 and $1,409 and $1,268 for the three and nine months ended September 30, 2008 and 2009, respectively) 13,400 37.7 % 11,594 33.6 % 38,969 41.4 % 36,277 39.6 %
Research and development 2,035 5.7 % 2,051 5.9 % 6,819 7.3 % 5,905 6.4 %
Total operating expenses 15,435 43.4 % 13,645 39.5 % 45,788 48.7 % 42,182 46.0 %
Income from operations 6,194 17.4 % 4,239 12.3 % 10,316 11.0 % 4,600 5.0 %
Other income (expense):
Interest income (expense), net 231 0.7 % 10 0.0 % 773 0.8 % 75 0.1 %
Other income (expense), net (82 ) -0.2 % (31 ) -0.1 % (503 ) -0.6 % 107 0.1 %
Other, net 149 0.5 % (21 ) -0.1 % 270 0.2 % 182 0.2 %
Income before provision for income taxes 6,343 17.9 % 4,218 12.2 % 10,586 11.2 % 4,782 5.2 %
Provision for income taxes 1,808 5.1 % 1,302 3.8 % 2,646 2.8 % 1,669 1.8 %
Net income $ 4,535 12.8 % $ 2,916 8.4 % $ 7,940 8.4 % $ 3,113 3.4 %
Earnings per common share:
Basic $ 0.26 $ 0.17 $ 0.45 $ 0.18
Diluted $ 0.24 $ 0.17 $ 0.42 $ 0.18
Weighted average shares used in computing earnings per common share:
Basic 17,610 16,894 17,783 17,031
Diluted 18,792 17,616 18,902 17,769
-------------------------------------------------------------------------------
HOME DIAGNOSTICS, INC. AND SUBSIDIARIES
Supplemental Information
(In thousands)
(Unaudited)
December 31, September 30,
2008 2009
Selected Balance Sheet Data:
Cash and cash equivalents $ 30,367 $ 22,091
Working capital 44,005 41,421
Total assets 140,580 144,333
Total stockholders' equity 112,066 112,634
Three Months Ended September 30, Nine Months Ended September 30,
2008 2009 2008 2009
Cash Flow Data:
Cash provided by operating activities $ 3,173 $ 4,205 $ 9,388 $ 5,683
Cash used in investing activities (603 ) (2,388 ) (3,925 ) (10,110 )
Cash provided by (used in) financing activities (2,430 ) 211 (3,873 ) (4,050 )
Revenue by Channel:
Three Months Ended September 30,
2008 2009 Increase/(Decrease)
Domestic:
Retail $ 7,981 22.4 % $ 8,645 25.0 % $ 664 8.3 %
Distribution 18,802 52.9 % 15,620 45.3 % (3,182 ) -16.9 %
Mail Service 5,307 14.9 % 6,071 17.6 % 764 14.4 %
Total Domestic 32,090 90.2 % 30,336 87.9 % (1,754 ) -5.5 %
International 3,475 9.8 % 4,164 12.1 % 689 19.8 %
Total $ 35,565 100.0 % $ 34,500 100.0 % $ (1,065 ) -3.0 %
Nine Months Ended September 30,
2008 2009 Increase/(Decrease)
Domestic:
Retail $ 20,536 21.8 % $ 25,585 27.9 % $ 5,049 24.6 %
Distribution 48,010 51.1 % 39,646 43.2 % (8,364 ) -17.4 %
Mail Service 14,897 15.8 % 17,116 18.6 % 2,219 14.9 %
Total Domestic 83,443 88.7 % 82,347 89.7 % (1,096 ) -1.3 %
International 10,598 11.3 % 9,408 10.3 % (1,190 ) -11.2 %
Total $ 94,041 100.0 % $ 91,755 100.0 % $ (2,286 ) -2.4 %
-------------------------------------------------------------------------------
[HDIX-F]
A service of YellowBrix, Inc.
