cryolife8k102909.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
washington,
d.c. 20549
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date
of Report (Date of earliest event reported): October 29,
2009
_______________________
CRYOLIFE,
INC.
(Exact
name of registrant as specified in its charter)
_________________________
Florida
|
1-13165
|
59-2417093
|
(State
or Other Jurisdiction
of
Incorporation)
|
(Commission
File Number)
|
(IRS
Employer
Identification
No.)
|
1655
Roberts Boulevard, N.W., Kennesaw, Georgia 30144
(Address
of principal executive office) (zip code)
Registrant's
telephone number, including area code: (770) 419-3355
_____________________________________________________________
(Former
name or former address, if changed since last report)
_________________________
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (see General Instruction
A.2. below):
o
|
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|
o
|
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
o
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
|
o
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
|
Section 2 Financial
Information
Item 2.02 Results of Operations and Financial
Condition.
On October 29, 2009, CryoLife, Inc.
(“CryoLife” or the “Company”) issued a press release announcing its financial
results for the quarter ended September 30, 2009. CryoLife hereby incorporates
by reference herein the information set forth in its Press Release dated October
29, 2009, a copy of which is attached hereto as Exhibit 99.1. Except as
otherwise provided in the press release, the press release speaks only as of the
date of such press release and it shall not create any implication that the
affairs of CryoLife have continued unchanged since such date. The
press release includes certain supplemental non-GAAP financial
measures:
·
|
non-GAAP
preservation service revenue growth, which has been obtained by adjusting
the comparable preservation service GAAP revenue growth number to exclude
revenues related to orthopedic tissue processing
services;
|
·
|
non-GAAP
preservation service revenues, which have been obtained by adjusting the
comparable preservation service segment revenue numbers to exclude
revenues related to orthopedic tissue processing
services;
|
·
|
non-GAAP
net income, which has been obtained by measuring net income as if the
Company had recorded 2008 income taxes at a normalized 41 percent
effective tax rate;
|
·
|
non-GAAP
fully diluted earnings per share, which have been obtained by measuring
fully diluted earnings per share as if the Company had recorded 2008
income taxes at a normalized 41 percent effective tax
rate;
|
·
|
non-GAAP
product revenues, which have been obtained by excluding the effects of
changes in foreign currency exchange
rates.
|
Preservation service revenue growth has
been adjusted to obtain non-GAAP preservation service revenue growth, and
preservation service segment revenues have been adjusted to obtain non-GAAP
preservation service revenues, by excluding revenues from orthopedic tissue
processing, because the Company discontinued procuring and processing such
tissue as of January 1, 2007 and ceased distributing its remaining orthopedic
tissue as of June 30, 2008. Because the Company’s revenues from
orthopedic tissue have been effectively reduced to zero and should remain at
that level for the foreseeable future, the Company believes that the non-GAAP
revenue growth numbers presented, as well as the non-GAAP preservation service
revenues presented, provide investors with a more accurate measure of the
relative revenue performance of the Company’s continuing preservation service
business.
Net income and fully diluted earnings
per share have been adjusted to obtain non-GAAP net income and fully diluted
earnings per share by presenting the figures as if the Company had recorded 2008
income taxes at a normalized 41 percent effective tax rate because the Company's
effective income tax rate was lower in 2008 due to the valuation allowance on
the Company's deferred tax assets during 2008. The Company believes
that the presentation of non-GAAP net income and fully diluted earnings per
share provides investors with the ability to better compare the Company’s
relative period-to-period performance with respect to such
measurements.
Product revenues have been adjusted to
obtain non-GAAP revenues by excluding the effects of changes in foreign currency
exchange rates in order to show the underlying trend in demand for the Company’s
products and the impact of that demand on revenues, as fluctuations in foreign
exchange rates may tend to obscure the trend in overall demand.
Accordingly, CryoLife believes that
these non-GAAP measures, when read in conjunction with the Company’s GAAP
financials, provide useful information to investors by offering:
·
|
the
ability to make more meaningful period-to-period comparisons of the
Company’s on-going operating
results;
|
·
|
the
ability to better identify trends in the Company’s underlying business and
perform related trend analyses; and
|
·
|
a
better understanding of how management plans and measures the Company’s
underlying business.
|
The additional non-GAAP financial
information is not meant to be considered in isolation or as a substitute for
measures calculated in accordance with GAAP. With respect to the
financial information regarding our products, investors are cautioned to avoid
overreliance on the non-GAAP financial measures, as a substantial portion of our
sales occur in European denominated currency and foreign currency exchange rates
have, and will continue to have, a material impact on CryoLife
dollar-denominated revenues. Management considers both the GAAP and
non-GAAP financial measures regarding our products when evaluating the Company’s
business prospects and overall health and continues to evaluate alternatives to
ameliorate the impact of foreign exchange rate fluctuations on the Company’s
revenues.
The information provided pursuant to
this Item 2.02 is to be considered “furnished” pursuant to Item 2.02 of Form 8-K
and shall not be deemed to be “filed” for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended, or otherwise subject to the
liabilities of that Section or Sections 11 and 12(a)(2) of the Securities Act of
1933, as amended, nor shall it be deemed incorporated by reference into any of
CryoLife’s reports or filings with the Securities and Exchange Commission
(“SEC”), whether made before or after the date hereof, except as expressly set
forth by specific reference in such report or filing.
Except for the historical information
contained in this report, the statements made by CryoLife are forward-looking
statements that involve risks and uncertainties. All such statements are subject
to the safe harbor created by the Private Securities Litigation Reform Act of
1995. CryoLife’s future financial performance could differ significantly from
the expectations of management and from results expressed or implied in the
press release. Please refer to the last paragraph of the press release for
further discussion about forward-looking statements. For further information on
risk factors, please refer to “Risk Factors” contained in CryoLife’s Form 10-K
for the year ended December 31, 2008, as filed with the SEC, and any subsequent
SEC filings, as well as in the press release. CryoLife disclaims any obligation
or duty to update or modify these forward-looking statements.
Section
9 Financial Statements and
Exhibits.
Item
9.01(d) Exhibits.
(a)
Financial Statements.
Not applicable.
(b) Pro
Forma Financial Information.
Not applicable.
(c) Shell
Company Transactions.
Not applicable.
(d)
Exhibits.
|
Exhibit Number
|
Description
|
|
|
|
|
99.1*
|
Press
release dated October 29, 2009
|
|
* This
exhibit is furnished, not filed.
|
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, CryoLife, Inc. has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
|
CRYOLIFE,
INC. |
|
|
|
|
|
|
|
|
|
|
|
|
|
Date:
October 29, 2009
|
By:
|
/s/ D.A.
Lee |
|
|
Name: |
D.
Ashley Lee |
|
|
Title: |
Executive
Vice President, Chief |
|
|
|
Operating
Officer and Chief |
|
|
|
Financial
Officer |
|
.
cryolife8k102909ex99.htm
EXHIBIT 99.1
N E W S R E L E A S E
FOR
IMMEDIATE RELEASE
Media
Contact:
D. Ashley
Lee
Executive
Vice President, Chief Financial Officer and
Chief
Operating Officer
Phone:
770-419-3355
CryoLife
Reports Record Quarterly Revenues of $28.2 Million
Company
posts fully diluted earnings per share of $0.07 for third quarter of
2009;
Revenues
increased 5 percent for third quarter of 2009 compared to third quarter of
2008
ATLANTA, GA…(October 29,
2009)…CryoLife, Inc. (NYSE: CRY), an implantable biological medical
device and cardiovascular tissue processing company, announced today that
revenues for the third quarter of 2009 increased 5 percent to a quarterly record
of $28.2 million compared to $26.8 million for the third quarter of
2008.
Net
income for the third quarter of 2009 was $1.9 million, or $0.07 per basic and
fully diluted common share, compared to $3.6 million, or $0.13 per basic and
$0.12 per fully diluted common share for the third quarter of
2008. The Company’s effective income tax rate was 41 percent for the
third quarter of 2009, compared to 6 percent for the third quarter of
2008. The Company’s effective income tax rate was lower in 2008 due
to the valuation allowance on the Company’s deferred tax assets during
2008. If the Company had recorded 2008 income taxes at a normalized
41 percent effective tax rate, net income for the third quarter of 2008 would
have been $2.2 million and fully diluted earnings per share would have been
$0.08.
Revenues
for the first nine months of 2009 increased 4 percent to a record $83.1 million
compared to $79.5 million for the first nine months of 2008.
Net
income for the first nine months of 2009 was $6.3 million, or $0.22 per basic
and fully diluted common share, compared to $10.2 million, or $0.37 per basic
and $0.36 per fully diluted common share for the first nine months of
2008. If the Company had recorded 2008 income taxes at a normalized
41 percent effective tax rate, net income for the first nine months of 2008
would have been $6.4 million and fully diluted earnings per share would have
been $0.22. The Company has net operating loss carryforwards that
will largely reduce required cash payments for federal and state income taxes
for the 2009 tax year.
Preservation
service revenues for the third quarter of 2009 increased 6 percent to $15.0
million compared to $14.2 million for the third quarter of 2008. The
increase in preservation service revenues was primarily due to increased
shipments of cardiac and vascular tissues for the third quarter of 2009 compared
to the third quarter of 2008.
Preservation
service revenues for the first nine months of 2009 increased 3 percent to $42.7
million compared to $41.3 million for the first nine months of
2008. Excluding orthopaedic tissue processing revenues of $148,000
and $662,000 for the first nine months of 2009 and 2008, respectively,
preservation service revenues increased 5 percent to $42.5 million for the first
nine months of 2009 compared to $40.7 million for the first nine months of
2008. The increase in preservation service revenues was primarily due
to increased revenues from vascular tissue for the first nine months of 2009
compared to the first nine months of 2008.
Revenues
from the distribution of CryoValve® SG
pulmonary heart valves and CryoPatch® SG
pulmonary cardiac patches increased to $1.9 million for the third quarter of
2009 from $1.7 million for the third quarter of 2008, representing 26 percent of
the Company’s cardiac tissue processing revenues for the third quarter of
2009. Revenues from the distribution of CryoValve SG and CryoPatch SG
increased to $4.6 million for the first nine months of 2009 from $3.4 million
for the first nine months of 2008, representing 24 percent of the Company’s
cardiac tissue processing revenues for the first nine months of
2009.
Product
revenues, which consists primarily of sales of BioGlue®
Surgical Adhesive and HemoStase™, were $12.8 million for the third quarter of
2009 compared to $12.2 million for the third quarter of 2008, an increase of 5
percent. Excluding the effects of changes in foreign currency
exchange rates for the third quarter of 2009 compared to those in effect during
the third quarter of 2008, which reduced revenues by $132,000 for the third
quarter of 2009, product revenues would have been $12.9 million.
Product
revenues were $39.7 million for the first nine months of 2009 compared to $37.5
million for the first nine months of 2008, an increase of 6
percent. Excluding the effects of changes in foreign currency
exchange rates for the first nine months of 2009 compared to those in effect
during the third quarter of 2008, which reduced revenues by $804,000 for the
first nine months of 2009, product revenues would have been $40.5
million.
Total
preservation services and product gross margins were 60 percent and 64 percent
for the third quarters of 2009 and 2008, respectively. Total
preservation services and product gross margins were 62 percent and 64 percent
for the first nine months of 2009 and 2008, respectively.
Preservation
services gross margins were 41 percent and 46 percent for the third quarters of
2009 and 2008, respectively. Preservation services gross margins were
43 percent and 46 percent for the first nine months of 2009 and 2008,
respectively.
Product
gross margins were 82 percent and 83 percent for the third quarters of 2009 and
2008, respectively. Product gross margins were 84 percent for each of
the first nine months of 2009 and 2008.
General,
administrative, and marketing expenses for the third quarter of 2009 were $12.4
million compared to $12.1 million for the third quarter of
2008. General, administrative, and marketing expenses for the first
nine months of 2009 were $37.4 million compared to $36.5 million for the first
nine months of 2008. These expenses included personnel costs,
advertising, physician education and training, and promotional materials to
support current revenue growth and the Company’s efforts to increase its
preservation service and product offerings.
General,
administrative, and marketing expenses for the first nine months of 2009 and
2008 included benefits of $405,000 and $449,000, respectively, related to the
adjustment of reserves for product liability losses.
Research
and development expenses were $1.5 million and $1.2 million for the third
quarters of 2009 and 2008, respectively. Research and development
expenses were $3.9 million for each of the first nine months of 2009 and
2008. Research and development spending in 2009 is primarily focused
on the Company’s BioGlue and related products and SynerGraft®
tissues and products.
As of
September 30, 2009, the Company had $32.0 million in cash, cash equivalents, and
restricted securities, compared to $22.8 million at December 31,
2008. Of this $32.0 million, $2.6 million was received from the U.S.
Department of Defense as advance funding for the development of BioFoamÒ
protein hydrogel technology, and $5.0 million was designated as long-term
restricted money market funds due to a financial covenant requirement under the
Company’s credit agreement.
“We saw
several key milestones during the third quarter of 2009, including the 510(k)
clearance for CryoPatch SG, the Humanitarian Use Device designation for
CryoValve SG aortic heart valve, and the CE Mark and first human implants of
BioFoam,” stated Steven G. Anderson, president and chief executive
officer. “We will continue to drive the development of our SynerGraft
and BioGlue and related product platforms forward to bring new innovative
solutions to cardiac and vascular surgeons, and the patients they
serve.”
2009
Financial Guidance
The
Company is updating its guidance for the full year of 2009. The
Company expects total revenues for the full year of 2009 to be near the lower
end of its range of guidance of between $112.0 million and $116.0
million. The Company expects preservation services revenues to be
near the lower end of its previous range of guidance of between $57.0 million
and $59.0 million. The Company expects product revenues to be near
the lower end of its previous range of guidance of between $54.0 million and
$56.0 million, with BioGlue revenues to be slightly below its previous range of
guidance of between $49.0 million and $50.0 million for the full year of 2009
and HemoStase revenues to be near the higher end of its previous range of
guidance of between $5.0 million and $6.0 million in 2009. Tissue
processing and product revenues could be affected by several factors, including
but not limited to, the general economic environment and its effect on demand
for the Company’s tissues and products, and changes in foreign currency exchange
rates and their effects on revenues generated in international
markets. Other revenues for 2009 are expected to be approximately
$1.0 million, related to funding received from the Department of Defense in
connection with the development of BioFoam. The amount of other
revenues is largely dependent upon actual expenses incurred related to the
development of BioFoam.
The
Company expects general, administrative, and marketing expenses to be near the
lower end of its previous range of guidance of between $50.0 million and $52.0
million, and research and development expenses of between $5.0 million and $6.0
million for the full year of 2009. The research and development
expectations include approximately $1.0 million to be funded by the Department
of Defense in connection with the development of BioFoam.
The
Company expects operating income to increase for the full year of 2009 compared
to 2008. However, the Company expects its effective income tax rate
to be approximately 41 percent in 2009 compared to a tax benefit in
2008. As a result, earnings per share in 2009 will be lower than in
2008, when the Company reversed a significant portion of the valuation allowance
on its deferred tax assets, which resulted in the recognition of significant
income tax benefits.
2010
Financial Guidance
The
Company plans to issue its initial 2010 financial guidance on either December 1
or 2, 2009 in connection with its presentation at the Piper Jaffray Healthcare
Conference in New York.
Webcast
and Conference Call Information
The
Company will hold a teleconference call and live webcast today at 10:00 a.m.
Eastern Time to discuss the results followed by a question and answer session
hosted by Mr. Anderson.
To listen
to the live teleconference, please dial 201-689-8261 a few minutes prior to
10:00 a.m. A replay of the teleconference will be available from
October 29 through November 5 and can be accessed by calling 877-660-6853 (toll
free) or 201-612-7415. The account number for the replay is 244 and
the conference number is 333891.
The live
webcast and replay can be accessed by going to the Investor Relations section of
the CryoLife Web site at www.cryolife.com and
selecting the heading Webcasts & Presentations.
About
CryoLife, Inc.
Founded
in 1984, CryoLife, Inc. is a leader in the processing and distribution of
implantable living human tissues for use in cardiac and vascular surgeries
throughout the U.S. and Canada. The Company's CryoValve® SG
pulmonary heart valve, processed using CryoLife's proprietary SynerGraft®
technology, has FDA 510(k) clearance for the replacement of diseased, damaged,
malformed, or malfunctioning native or prosthetic pulmonary
valves. The Company’s CryoPatch® SG
pulmonary cardiac patch has FDA 510(k) clearance for the repair or
reconstruction of the right ventricular outflow tract (RVOT), which is a surgery
commonly performed in children with congenital heart defects, such as Tetralogy
of Fallot, Truncus Arteriosus, and Pulmonary Atresia. CryoPatch SG is
distributed in three anatomic configurations: pulmonary hemi-artery, pulmonary
trunk, and pulmonary branch. The Company's BioGlue®
Surgical Adhesive is FDA approved as an adjunct to sutures and staples for use
in adult patients in open surgical repair of large vessels. BioGlue
is also CE marked in the European Community and approved in Canada and Australia
for use in soft tissue repair. The Company's BioFoam®
Surgical Matrix is CE marked in the European Community for use as an adjunct in
the sealing of abdominal parenchymal tissues (liver and spleen) when cessation
of bleeding by ligature or other conventional methods is ineffective or
impractical. BIOGLUE Aesthetic™ Medical Adhesive
is CE marked in the European Community for periosteal fixation following
endoscopic browplasty (brow lift) in reconstructive plastic surgery and is
distributed by a third party for this indication. CryoLife
distributes HemoStase™, a hemostatic agent, in much of the U.S. for use in
cardiac and vascular surgery and in the European Community and Canada for
cardiac, vascular, and general surgery, subject to certain
exclusions.
Statements
made in this press release that look forward in time or that express
management's beliefs, expectations or hopes are forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of
1995. These statements include those regarding anticipated 2009
performance and our development of our SynerGraft and BioGlue and related
product platforms and statements regarding the expected impact of our net
operating loss carryforwards on our cash outlays for tax
obligations. These future events may not occur as and when expected,
if at all, and, together with our business, are subject to various risks and
uncertainties. These risks and uncertainties include that we are
significantly dependent on revenues from BioGlue and there are a variety of
risks affecting BioGlue, CryoValve SG pulmonary heart valves and other
SynerGraft processed tissues and products may not be accepted by the
marketplace, the CryoValve SG pulmonary heart valve has a one year shelf life,
the CryoPatch SG has a one year shelf life, we are dependent on the availability
of sufficient quantities of tissue from human donors, the CryoValve SG pulmonary
heart valve post-clearance study requested by the FDA may not provide the
expected positive results, our products and tissues we process and preserve have
allegedly caused and may in the future cause injury to patients, and we have
been and may be exposed to tissue processing and product liability claims and
additional regulatory scrutiny as a result, the possibility that the FDA could
impose additional restrictions on the Company's operations, issue a 483, or
warning letter, or require a recall, or prevent the Company from processing and
distributing tissues or manufacturing and distributing other products, our
failure to adequately comply with government regulations could result in loss of
revenues and customers as well as additional compliance expense, our ability to
borrow under our credit facility may be limited, the credit facility limits our
ability to pursue significant acquisitions, the financial and credit liquidity
crisis may adversely affect our ability to borrow money or raise capital, the
current economic crisis and future economic crises may adversely affect our
business and financial condition, there are limitations on our use of net
operating loss carry-forwards that could result in our inability to use them
fully or at all, adverse regulatory action outside of the U.S. could affect our
business, physicians have been and may be reluctant to implant or use our
preserved tissues or products, our existing insurance policies may not be
sufficient to cover our actual claims liability, current economic conditions may
impact demand for our tissues and products, intense competition may affect our
ability to operate profitably, we may be unable to obtain adequate insurance at
a reasonable cost or at all, uncertainties related to patents and protection of
proprietary technology may adversely affect the value of our intellectual
property, uncertainties related to patents and protection of proprietary
technology for products distributed by us may adversely affect our ability to
distribute those products, we are dependent on key personnel, we may not be
successful in obtaining necessary clinical results and regulatory approvals for
products and services in development, and our new products and services may not
achieve market acceptance, we may be unable to effectively leverage our existing
sales force to sell HemoStase, the lawsuit we filed against Medafor regarding
our distribution agreement with Medafor may adversely impact our relationship
with Medafor and could hamper or prevent us from distributing HemoStase, Medafor
may in the future attempt to terminate our distribution agreement, rapid
technological change could cause our services and products to become obsolete,
extensive government regulation may adversely affect our ability to develop and
sell products and services, we have experienced operating losses and negative
cash flows in the past, and we must continue to address the underlying causes in
order to continue to operate profitably and generate positive cash flows,
investments in new technologies and acquisitions of products or distribution
rights may not be successful, if we are not successful in expanding our business
activities in international markets, we will be unable to pursue one of our
strategies for increasing our revenues, continued deflation of foreign
currencies relative to the U.S. dollar could materially and adversely impact our
foreign revenues, and future healthcare policies, healthcare reimbursement
methods, and healthcare reimbursement policies may affect the availability,
amount, and timing of our revenues, financial condition, and
profitability. These risks and uncertainties include the risk factors
detailed in our Securities and Exchange Commission filings, including our Form
10-K filing for the year ended December 31, 2008, our Form 10-Q filing for the
quarter ended March 31, 2009, our Form 10-Q filing for the quarter ended June
30, 2009, our Form 10-Q to be filed for the quarter ended September 30, 2009,
and the Company's other SEC filings. The Company does not undertake
to update its forward-looking statements.
CRYOLIFE,
INC. AND SUBSIDIARIES
Financial
Highlights
(In
thousands, except per share data)
|
|
Three
Months Ended
|
|
|
Nine
Months Ended
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
2009
|
|
|
2008
|
|
|
2009
|
|
|
2008
|
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
Preservation
services
|
|
$ |
15,033 |
|
|
$ |
14,188 |
|
|
$ |
42,672 |
|
|
$ |
41,337 |
|
Products
|
|
|
12,806 |
|
|
|
12,239 |
|
|
|
39,669 |
|
|
|
37,499 |
|
Other
|
|
|
380 |
|
|
|
377 |
|
|
|
729 |
|
|
|
691 |
|
Total
revenues
|
|
|
28,219 |
|
|
|
26,804 |
|
|
|
83,070 |
|
|
|
79,527 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost
of preservation services and products:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preservation
services
|
|
|
8,903 |
|
|
|
7,615 |
|
|
|
24,421 |
|
|
|
22,382 |
|
Products
|
|
|
2,275 |
|
|
|
2,028 |
|
|
|
6,478 |
|
|
|
5,860 |
|
Total
cost of preservation services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
and
products
|
|
|
11,178 |
|
|
|
9,643 |
|
|
|
30,899 |
|
|
|
28,242 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
|
|
17,041 |
|
|
|
17,161 |
|
|
|
52,171 |
|
|
|
51,285 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General,
administrative, and marketing
|
|
|
12,386 |
|
|
|
12,072 |
|
|
|
37,440 |
|
|
|
36,497 |
|
Research
and development
|
|
|
1,461 |
|
|
|
1,186 |
|
|
|
3,854 |
|
|
|
3,938 |
|
Total
operating expenses
|
|
|
13,847 |
|
|
|
13,258 |
|
|
|
41,294 |
|
|
|
40,435 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
|
3,194 |
|
|
|
3,903 |
|
|
|
10,877 |
|
|
|
10,850 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
58 |
|
|
|
62 |
|
|
|
168 |
|
|
|
201 |
|
Interest
income
|
|
|
(10 |
) |
|
|
(92 |
) |
|
|
(73 |
) |
|
|
(285 |
) |
Other
expense, net
|
|
|
8 |
|
|
|
142 |
|
|
|
100 |
|
|
|
115 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
before income taxes
|
|
|
3,138 |
|
|
|
3,791 |
|
|
|
10,682 |
|
|
|
10,819 |
|
Income
tax expense
|
|
|
1,276 |
|
|
|
235 |
|
|
|
4,369 |
|
|
|
610 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$ |
1,862 |
|
|
$ |
3,556 |
|
|
$ |
6,313 |
|
|
$ |
10,209 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$ |
0.07 |
|
|
$ |
0.13 |
|
|
$ |
0.22 |
|
|
$ |
0.37 |
|
Diluted
|
|
$ |
0.07 |
|
|
$ |
0.12 |
|
|
$ |
0.22 |
|
|
$ |
0.36 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
28,145 |
|
|
|
27,899 |
|
|
|
28,074 |
|
|
|
27,741 |
|
Diluted
|
|
|
28,382 |
|
|
|
28,703 |
|
|
|
28,261 |
|
|
|
28,384 |
|
CRYOLIFE,
INC. AND SUBSIDIARIES
Financial
Highlights
(In
thousands)
|
|
Three
Months Ended
|
|
|
Nine
Months Ended
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
2009
|
|
|
2008
|
|
|
2009
|
|
|
2008
|
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
Preservation
services:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cardiac
tissue
|
|
$ |
7,315 |
|
|
$ |
7,034 |
|
|
$ |
19,377 |
|
|
$ |
19,620 |
|
Vascular
tissue
|
|
|
7,699 |
|
|
|
7,116 |
|
|
|
23,147 |
|
|
|
21,055 |
|
Orthopaedic
tissue
|
|
|
19 |
|
|
|
38 |
|
|
|
148 |
|
|
|
662 |
|
Total
preservation services
|
|
|
15,033 |
|
|
|
14,188 |
|
|
|
42,672 |
|
|
|
41,337 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Products:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BioGlue
and related products
|
|
|
11,180 |
|
|
|
11,623 |
|
|
|
35,323 |
|
|
|
36,482 |
|
HemoStase
|
|
|
1,562 |
|
|
|
549 |
|
|
|
4,139 |
|
|
|
726 |
|
Other
medical devices
|
|
|
64 |
|
|
|
67 |
|
|
|
207 |
|
|
|
291 |
|
Total
products
|
|
|
12,806 |
|
|
|
12,239 |
|
|
|
39,669 |
|
|
|
37,499 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
|
380 |
|
|
|
377 |
|
|
|
729 |
|
|
|
691 |
|
Total
revenues
|
|
$ |
28,219 |
|
|
$ |
26,804 |
|
|
$ |
83,070 |
|
|
$ |
79,527 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S.
|
|
$ |
23,941 |
|
|
$ |
22,916 |
|
|
$ |
70,264 |
|
|
$ |
67,750 |
|
International
|
|
|
4,278 |
|
|
|
3,888 |
|
|
|
12,806 |
|
|
|
11,777 |
|
Total
revenues
|
|
$ |
28,219 |
|
|
$ |
26,804 |
|
|
$ |
83,070 |
|
|
$ |
79,527 |
|
|
|
September
30,
|
|
|
December
31,
|
|
|
|
2009
|
|
|
2008
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents and restricted securities
|
|
$ |
27,046 |
|
|
$ |
17,763 |
|
Receivables,
net
|
|
|
15,293 |
|
|
|
13,999 |
|
Deferred
preservation costs
|
|
|
36,737 |
|
|
|
34,913 |
|
Inventories
|
|
|
6,462 |
|
|
|
7,077 |
|
Restricted
money market funds, long-term
|
|
|
5,000 |
|
|
|
5,000 |
|
Total
assets
|
|
|
133,299 |
|
|
|
125,995 |
|
Shareholders’
equity
|
|
|
108,260 |
|
|
|
99,326 |
|
CRYOLIFE,
INC.
Unaudited
Reconciliation of
Non-GAAP
Net Income and Income per Common Share
(In
thousands, except per share data)
|
|
Three
Months Ended
|
|
|
Nine
Months Ended
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
|
2009
|
|
|
2008
|
|
|
2009
|
|
|
2008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
before income taxes
|
|
$ |
3,138 |
|
|
$ |
3,791 |
|
|
$ |
10,682 |
|
|
$ |
10,819 |
|
Income
tax expense
|
|
|
1,276 |
|
|
|
235 |
|
|
|
4,369 |
|
|
|
610 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$ |
1,862 |
|
|
$ |
3,556 |
|
|
$ |
6,313 |
|
|
$ |
10,209 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income
per common share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$ |
0.07 |
|
|
$ |
0.13 |
|
|
$ |
0.22 |
|
|
$ |
0.37 |
|
Diluted
|
|
$ |
0.07 |
|
|
$ |
0.12 |
|
|
$ |
0.22 |
|
|
$ |
0.36 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
28,145 |
|
|
|
27,899 |
|
|
|
28,074 |
|
|
|
27,741 |
|
Diluted
|
|
|
28,382 |
|
|
|
28,703 |
|
|
|
28,261 |
|
|
|
28,384 |
|
Net
income
|
|
$ |
3,556 |
|
|
$ |
10,209 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP
adjustments to net income:
|
|
|
|
|
|
|
|
|
Tax
calculated at 41% of income before income taxes
|
|
|
1,554 |
|
|
|
4,436 |
|
Less
income tax expense, as reported
|
|
|
(235 |
) |
|
|
(610 |
) |
Additional
income tax expense, non-GAAP
|
|
|
1,319 |
|
|
|
3,826 |
|
|
|
|
|
|
|
|
|
|
Net
income, non-GAAP
|
|
$ |
2,237 |
|
|
$ |
6,383 |
|
|
|
|
|
|
|
|
|
|
Income
per common share, non-GAAP:
|
|
|
|
|
|
|
|
|
Basic
|
|
$ |
0.08 |
|
|
$ |
0.23 |
|
Diluted
|
|
$ |
0.08 |
|
|
$ |
0.22 |
|
|
|
|
|
|
|
|
|
|
Weighted
average common shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
27,899 |
|
|
|
27,741 |
|
Diluted
|
|
|
28,703 |
|
|
|
28,384 |
|
For
additional information about the company, visit CryoLife’s Web
site:
www.cryolife.com.
END