EDAP TMS (NASDAQ:EDAP)
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EDAP TMS S.A. Reports 2003 Third Quarter Financial Results
- UDS Division Continues Record Breaking Year -
VAULX-EN-VELIN, France, Nov. 5 /PRNewswire-FirstCall/ -- EDAP TMS S.A. , a
global leader in the development, marketing and distribution of a portfolio of
minimally-invasive medical devices for the treatment of urological diseases,
today reported financial results for the third quarter ended September 30,
2003.
The Company's revenues for the third quarter of 2003 were EUR 4.7 million
compared to EUR 4.1 million in the same quarter of 2002. Third quarter revenues
included the sale of ten lithotripsy machines. Total revenues for the nine
months ended September 30, 2003 were EUR 13.9 million compared to EUR 14.0
million in the same period of 2002, partially due to the decrease in TUMT
manufacturing revenues.
The Company's gross margin, for the third quarter of 2003 and for the nine
months ended September 30, 2003, were 31% and 34%, respectively, versus 38% and
41% for the same periods in 2002. The decrease, year over year, is partially
related to the strong Euro and the decrease sequentially is primarily due to
lower than expected revenues in the Company's HIFU division.
The Company's expenses in the third quarter of 2003 were EUR 2.6 million and
were EUR 8.6 million for the nine months ended September 30, 2003, which was
below budget.
The Company's operating loss was EUR 1.2 million in the third quarter of 2003
compared to EUR 1.8 million in the third quarter of 2002 and was EUR 3.9 million
in the nine months ended September 30, 2003 compared to EUR 3.4 million in the
same period of 2002, partially due to the strong Euro.
As of September 30, 2003, the Company had EUR 12.0 million in cash and cash
equivalents, or EUR 1.53 per diluted share, which reflects the Company's
continued focus on cash management. Net book value is EUR 23.7 million, or EUR
3.03 per diluted share.
Philippe Chauveau, EDAP TMS's Chairman and CEO, commented, "While the overall
third quarter results are in line with expectations, the results by division
show a different situation.
HIFU division:
"The results of the Company's HIFU division did not meet expectations in terms
of either revenues or number of treatments performed. The third quarter included
several challenges, including continuing weakness in Italy and delayed orders
elsewhere. Per the conditions placed on the HIFU division by the board of
directors, the board met on October 21, 2003 to review the milestones expected
from this business in order to give directives and determine changes so as to
retain the overall goals of the Company.
"However, even with these challenges, we continue to be optimistic about the
future of HIFU as we see increases in recognition and acceptance of HIFU in
Europe at both the patient and physician level. Additionally, there were
positive events that occurred during the quarter that have yet to positively
impact the income statement of the HIFU division.
UDS division:
"The UDS division continued its record breaking year with a very strong third
quarter which included the sale of ten lithotripsy machines, bringing the nine
months number of machines sold to 27. The backlog of machines as of September
30, 2003 was seven units. The quarter continued to see an impact on revenues
related to the strong Euro which, through the end of the third quarter, had a
cumulative effect of EUR 1.0 million, however the division has been able to
offset this impact, as compared to 2003 expectation, with an increase in
expected units sold. Finally, for the UDS division, we continue to execute on
our goal of leveraging our distribution platform by adding new product
distribution on behalf of other companies. We anticipate announcing specifics
of these new products during the fourth quarter.
"Regarding the overall business, we had expected to be able to make an
announcement regarding a U.S. partner during this quarter. The search has taken
longer than expected. The discussions that the Company has had have focused on
the time and money required and not issues with the effectiveness of our
technologies.
"In conclusion, the Company with a September 30, 2003 cash balance of just under
EUR 12 million, continued to successfully implement its cash management plan
with a burn rate of less than EUR 1.0 million during the quarter. Therefore, the
Company expects to retain the necessary liquidity to reach the goal of overall
profitability and positive cash flow as planned," concluded Mr. Chauveau.
EDAP TMS S.A. is the global leader in the development, production, marketing and
distribution of a portfolio of minimally invasive medical devices primarily for
the treatment of urological diseases. The Company currently develops and markets
devices for the minimally invasive treatment of localized prostate cancer, using
High Intensity Focused Ultrasound (HIFU), through its EDAP SA subsidiary; it is
also developing this technology for the treatment of certain other types of
tumors. EDAP TMS S.A. also produces and commercializes medical equipment for
treatment of urinary tract stones using Extra-corporeal Shockwave Lithotripsy
(ESWL), via its TMS SA subsidiary. In addition, the Company markets in Japan and
Italy devices for the non-surgical treatment of benign Prostate Hyperplasia
(BPH) using Microwave Thermotherapy (TUMT). For more information, in the U.S.,
contact EDAP Technomed Inc., the Company's U.S. subsidiary located in Atlanta,
GA, by phone at (770) 446-9950. For additional information on the Company,
please see the Company's web site at: http://www.edap-tms.com/.
This press release contains, in addition to historical information,
forward-looking statements that involve risks and uncertainties. These include
statements regarding the Company's growth and expansion plans. Such statements
are based on management's current expectations and are subject to a number of
uncertainties and risks that could cause actual results to differ materially
from those described in the forward-looking statements. Factors that may cause
such a difference include, but are not limited to, those described in the
Company's filings with the Securities and Exchange Commission.
CONTACT: Philippe Chauveau / Blandine Confort
33.4.72.15.31.50
Ian Vawter - EDAP Technomed Inc.
1.770.446.9950
EDAP TMS S.A.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Amounts in thousands of Euro's and U.S. Dollars, except per share data)
Three Months Ended: Three Months Ended:
September September September September
30, 30, 30, 30,
2003 2002 2003 2002
Euros Euros $US $US
Net sales of medical
equipment 2,129 1,748 2,404 1,718
Net sales of spare
parts, supplies and
Services 2,349 2,361 2,652 2,320
NET SALES 4,478 4,109 5,056 4,038
Other revenues 241 30 271 29
TOTAL REVENUES 4,719 4,139 5,327 4,067
Cost of sales (3,308) (2,565) (3,734) (2,520)
GROSS PROFIT 1,411 1,574 1,593 1,547
Research & development
expenses (792) (753) (894) (740)
S, G & A expenses (1,846) (1,880) (2,084) (1,847)
Non-recurring operating
expenses -- (745) -- (732)
Total operating expenses (2,638) (3,378) (2,978) (3,319)
OPERATING PROFIT (LOSS) (1,227) (1,804) (1,385) (1,772)
Interest (expense)
income, net 35 369 40 362
Currency exchange gains
(loss), net 60 (137) 67 (134)
Other income (loss), net (3) (27) (3) (27)
INCOME (LOSS) BEFORE
TAXES AND MINORITY
INTEREST (1,135) (1,599) (1,281) (1,571)
Income tax (expense)
credit 14 39 16 38
NET INCOME (LOSS) (1,121) (1,560) (1,265) (1,533)
Earning per share -
Basic (0.14) (0.20) (0.16) (0.20)
Average number of
shares used in
computation
of EPS 7,781,731 7,781,731 7,781,731 7,781,731
Earning per share -
Diluted (0.14) (0.20) (0.16) (0.20)
Average number of
shares used in
computation of EPS 7,821,195 7,821,195 7,821,195 7,821,195
NOTE: Translated for convenience of the reader to U.S. dollars at the
2003 average three months noon buying rate of 1 Euro = 1.1289 USD, and
2002 average three months noon buying rate of 1 Euro = 0.9827 USD.
EDAP TMS S.A.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Amounts in thousands of Euro's and U.S. Dollars, except per share data)
Nine Months Ended: Nine Months Ended:
September September September September
30, 30, 30, 30,
2003 2002 2003 2002
Euros Euros $US $US
Net sales of medical
equipment 6,516 6,587 7,294 6,122
Net sales of spare
parts, supplies and
Services 7,004 7,224 7,839 6,714
NET SALES 13,520 13,811 15,133 12,836
Other revenues 338 149 378 138
TOTAL REVENUES 13,858 13,960 15,511 12,974
Cost of sales (9,245) (8,230) (10,348) (7,649)
GROSS PROFIT 4,613 5,730 5,163 5,325
Research & development
expenses (2,344) (2,176) (2,623) (2,023)
S, G & A expenses (6,207) (6,165) (6,947) (5,730)
Non-recurring operating
expenses -- (745) -- (692)
Total operating expenses (8,551) (9,086) (9,570) (8,445)
OPERATING PROFIT (LOSS) (3,938) (3,356) (4,407) (3,120)
Interest (expense)
income, net 42 549 47 510
Currency exchange gains
(loss), net (656) (599) (734) (557)
Other income (loss), net (164) 2,008 (184) 1,866
INCOME (LOSS) BEFORE
TAXES AND MINORITY
INTEREST (4,716) (1,398) (5,278) (1,301)
Income tax (expense)
credit 78 (170) 87 (158)
NET INCOME (LOSS) (4,638) (1,568) (5,191) (1,459)
Earning per share -
Basic (0.60) (0.20) (0.67) (0.19)
Average number of shares
used in computation
of EPS 7,781,731 7,768,383 7,781,731 7,768,383
Earning per share -
Diluted (0.59) (0.20) (0.66) (0.19)
Average number of shares
used in computation
of EPS 7,821,195 7,833,620 7,821,195 7,833,620
NOTE: Translated for convenience of the reader to U.S. dollars at the
2003 average nine months noon buying rate of 1 Euro = 1.1193 USD, and
2002 average nine months noon buying rate of 1 Euro = 0.9294 USD.
EDAP TMS S.A.
CONSOLIDATED BALANCE SHEETS HIGHLIGHTS (UNAUDITED)
(Amounts in thousands of Euro's and U.S. Dollars)
Sept. 30, June 30, Sept. 30, June 30,
2003 2003 2003 2003
Euros Euros $US $US
Cash, cash equivalents 11,963 12,769 13,937 14,687
and short
term investments
Total current assets 28,551 29,508 33,262 33,940
Total current
liabilities 9,363 9,301 10,908 10,698
Shareholders' Equity 23,663 24,722 27,567 28,435
NOTE: Translated for convenience of the reader to U.S. dollars at the
noon buying rate of 1 Euro = 1.165 USD, on September 30, 2003 and at the
noon buying rate of 1 Euro = 1.1502 USD, on June 30, 2003.
EDAP TMS S.A.
CONDENSED STATEMENTS OF OPERATIONS BY DIVISION
NINE MONTHS ENDED SEPTEMBER 30, 2003
(Amounts in thousands of Euro's)
EDAP TMS EDAP Consoli- Total
S.A. S.A. TMS da- After
HIFU UDS HQ tion Consoli-
Division Division Impact dation
Net sales of
medical
devices 1,148 6,499 (1,131) 6,516
Net sales of
spare parts,
supplies &
services 1,270 6,229 (495) 7,004
Other revenues 32 304 2 338
TOTAL REVENUES 2,450 13,032 2 (1,626) 13,858
GROSS PROFIT 806 33% 3,982 31% 2 (177) 4,613 34%
Research &
Development (1,172) (177) (1,349)
Total SG&A plus
depreciation (2,849) (3,319) (1,034) (7,202)
OPERATING
PROFIT (LOSS) (3,215) 486 (1,032) (177) (3,938)
DATASOURCE: EDAP TMS S.A.
CONTACT: Philippe Chauveau or Blandine Confort, both for EDAP TMS S.A.,
+33-4-72-15-31-50, or Ian Vawter of EDAP Technomed Inc., +1-770-446-9950
Web site: http://www.edaptechnomed.com/