Achieves Positive Operating Cash Flow in Fourth Quarter
SAN DIEGO, Feb. 5 /PRNewswire-FirstCall/ -- CardioDynamics (Nasdaq: CDIC), the innovator and leader of BioZ(R) Impedance Cardiography (ICG) technology, today reported financial results for its fourth quarter and fiscal 2008.
Key Financial and Operating Results for Fourth Quarter 2008 Compared with Fourth Quarter 2007
Key Financial and Operating Results of Fiscal 2008 Compared with Fiscal 2007
Additional Key Operating Milestones for the Fourth Quarter and Fiscal 2008
Fourth Quarter and Fiscal 2008 Operating Results Discussion
The Company reported a net sales increase of 6% to $6.5 million in the fourth quarter 2008 and 12% for full year 2008 to $24.5 million, representing the second consecutive year of growth. Fourth quarter ICG sales growth was driven by a combination of a 13% increase in BioZ sales, a 255% increase in ICG Module sales and an 11% increase in ICG sensor revenue.
ICG Module sales were particularly strong in the fourth quarter with purchases by General Electric Medical Systems (GEMS) of 72 ICG Modules and Mindray of 80 ICG Modules. The Company also received a firm purchase order in January 2009 from Mindray for an additional 150 ICG Modules deliverable in 2009.
ICG sensor revenue in the fourth quarter was a record $1.9 million, due in part to the clinical sales team's focused customer service efforts through the launch of the Comprehensive Customer Care (C3) and ICG CERTIFIED programs.
Gross margin as a percentage of sales increased from 68% to 72% in fiscal 2008, largely due to lower manufacturing overhead costs, 9% average unit sales price improvement, and lower inventory reserve requirements.
As part of the Company's efforts to accelerate the return to profitability, tight expense control resulted in a 1% overall reduction in 2008 operating expenses with the most significant savings occurring in non revenue generating areas including General and Administrative expenses, down $321,000 and Research and Development, down $188,000. The Company surpassed one of its major 2008 goals by achieving $276,000 of positive operating cash flow in the fourth quarter of 2008.
Fourth Quarter 2008 operating loss improved 47% to $442,000, down from an operating loss of $830,000 in fourth quarter 2007. The operating loss for fiscal 2008 was $2.0 million, a 58% improvement from fiscal 2007 operating loss of $4.8 million. Fiscal 2008 loss before income taxes, depreciation, amortization and equity compensation was $1.0 million, an improvement of $2.9 million, or 74%
CEO Comments and Outlook
"We were pleased with the continued improvement in our key operating metrics during the fourth quarter and throughout 2008," stated Michael K. Perry, Chief Executive Officer of CardioDynamics. "Despite the challenging business climate, we achieved our eighth consecutive quarter of revenue growth and accomplished our goal of generating positive operating cash flow, which was $276,000 during the quarter. Our recently introduced Comprehensive Customer Care (C3) and BioZ Certification programs helped grow recurring sensor revenue 11% during the quarter and should contribute appreciably to our growth plans in 2009. International, New Markets and our Medis team were particularly strong contributors on the revenue front, collectively growing 73% in 2008."
Perry continued, "We are conservatively planning for high single to low double-digit revenue growth in 2009 and have, as a major objective, achievement of positive operating cash flow for the entire year. With over $6 million in cash, we have the financial resources to continue to execute our business plan without the need to access the capital markets during these challenging times."
Perry concluded, "Looking out over the next two to three years, we hope to be able to achieve solid growth and improved operating performance with our unique technology in a niche market that is less than 6% penetrated and at the very early stages of market adoption. We believe that we may be well positioned to capitalize on the proposed Obama-Biden healthcare reform which focuses on supporting disease management programs as over 75% of total health care dollars are spent on patients with one or more chronic conditions, including diabetes, heart disease and high blood pressure. ICG is ideal to support the disease management programs for heart disease and hypertension."
Conference Call Information
Michael K. Perry, Chief Executive Officer, and Steve P. Loomis, Chief Financial Officer, will host a summary of CardioDynamics' fourth quarter and fiscal 2008 results in a conference call today, Thursday, February 5, 2009, at 4:30 p.m. (EDT). To access the conference call, dial 800-346-7359 (Code 7784). International participants can call 973-528-0008 (Code 7784). A replay of the call will be available for one month following the call at 800-332-6854 (Code 7784). The international replay number is 973-528-0005 (Code 7784). The Internet webcast can be accessed through the Investor Relations section of the Company's website at www.cdic.com or at:
CardioDynamics (Nasdaq: CDIC), the ICG Company, is the innovator and leader of an important medical technology called BioZ(R) Impedance Cardiography (ICG). The Company develops, manufactures and markets noninvasive BioZ(R) ICG products. The Company's BioZ(R) ICG Systems are being used by physicians around the world to help battle the number one killer of men and women - cardiovascular disease. Partners include GE Healthcare, Philips Medical Systems, and Mindray. For additional information, please refer to the company's Web site at www.cdic.com.
Forward-Looking (Safe Harbor) Statement
Except for historical and factual information contained herein, this press release contains forward-looking statements, such as expectation of continued revenue growth including high single to low double-digit revenue growth in 2009, the achievement of positive operating cash flow in 2009, continued improvement in our key operating metrics, expectation of solid growth and improved operating performance over the next two to three years, and the adequacy of our financial resources, the accuracy of which is necessarily subject to uncertainties and risks including the Company's primary dependence on the BioZ product line, and various uncertainties characteristic of early stage companies, as well as other risks detailed in the Company's filings with the SEC, including its 2007 Form 10-K. The Company does not undertake to update the disclosures contained in this press release.
CardioDynamics International Corporation In thousands, except per share data (unaudited) Selected Consolidated Operational Results Three Months Ended Twelve Months Ended November 30, November 30, 2008 2007 2008 2007 Net sales $6,509 $6,151 $24,517 $21,850 Cost of sales 1,910 2,157 6,976 6,897 Gross margin 4,599 3,994 17,541 14,953 Research and development 448 389 1,518 1,706 Selling and marketing 3,976 3,679 15,088 14,780 General and administrative 593 723 2,839 3,160 Amortization of intangible assets 26 32 122 147 Loss from operations (444) (829) (2,026) (4,840) Other expense, net (166) (166) (699) (846) Loss before income taxes and minority interest (610) (995) (2,725) (5,686) Minority interest in income of subsidiary (35) (33) (180) (78) Income tax (provision) benefit 78 (126) (441) (321) Income (loss) from discontinued operations - - 127 (10,614) Net loss $(567) $(1,154) $(3,219) $(16,699) Net loss per common share: Basic and diluted $(0.08) $(0.16) $(0.45) $(2.38) Weighted-average shares used in per share calculation: Basic and diluted 7,223 7,045 7,184 7,014 Selected Consolidated Balance Sheet Data November 30, 2008 2007 Cash and cash equivalents $6,306 $8,362 Accounts receivable, net 3,918 4,475 Inventory, net 1,490 1,948 Total current assets 12,138 15,442 Long-term assets 3,428 4,425 Total assets 15,566 19,867 Total current liabilities 4,499 5,620 Long-term liabilities 4,504 4,318 Total liabilities 9,003 9,938 Minority interest 472 407 Shareholders' equity 6,091 9,522
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