Symmetry Medical Reports Third Quarter 2008 Financi... (ompany's domestic forging operationsas a...)

Symmetry Medical Reports Third Quarter 2008 Financial Results

Date:11/12/2008

ompany's domestic forging operations as a result of a large press break down. The impact of these unfavorable items more than offset the lower loss experienced at our Sheffield operations of $0.8 million.

Gross margin percentage for the third quarter 2008 was 22.9% compared to gross margin percentage of 14.9% for the third quarter 2007.

Selling, general and administrative expenses were $15.2 million for the third quarter 2008, compared to $9.0 million in the third quarter 2007. The year-over-year increase was driven by $2.3 million from the addition of expenses from the recent acquisitions, $0.9 million from the remaining professional fees and expenses related to the review of accounting irregularities at the Sheffield, UK operating unit and $0.7 million from an increase in restricted stock expense. The remaining increase is a result of increased sales commission expense to support the higher sales levels and general inflation.

Operating income for the third quarter of 2008 was $10.5 million, up 359.9% from $2.3 million for the third quarter 2007. Operating margin for the third quarter 2008 was 9.4%, an increase from 3.0% for the third quarter 2007. In addition to several items in gross profit and SG&A mentioned above, operating income was negatively impacted by continuing operating losses at the Sheffield UK unit.

The third quarter 2008 net income included the unfavorable gross margin items worth $1.6 million or ($0.03) per share, a net unfavorable foreign exchange impact of $2.1 million or ($0.04) per share primarily at our Sheffield, UK operating unit, the impact of recording a full tax valuation allowance on current year losses at the Sheffield, UK operating unit of $1.1 million or ($0.03) per share, and the remaining Sheffield investigation expenses of $0.9 million or ($0.02) per share. Given these items, the net loss at Sheffield was $4.7 million compared to a net loss of $3.2 million in the second quarter of 2008. The Company i
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