Austin Business Journal - by Staff Reports -- Austin medical device maker ArthroCare Corp. (Nasdaq: ARTC) posted $8.4 million net income available to shareholders in the third quarter, up from a $31.7 million net loss the same three months last year, the company reported Tuesday.
ArthroCare, founded in 1993, develops minimally-invasive surgical products. The company increased revenue 10.6 percent to $87.9 million in the quarter ended Sept. 30. Shareholders earned 26 cents per share, up from a $1.18 loss per share last year. Gross product margin was 65.6 percent for the quarter versus 68.2 percent the same period in 2009.
The company’s sports medicine product sales accounted for much of the increase, rising 12.6 percent to $6.4 million, due to increased supply agreement with Smith & Nephew, the earnings release said.
The increase comes five months after ArthroCare, which was delisted from Nasdaq last year, filed to earmark 5.8 million shares of its stock for a New York-based private equity firm that invested $75 million. The deal enabled the company to pay off debts and get back on its feet following an accounting scandal.
ArthroCare employed 1,363 workers as of January. The company completed an initial public offering in 1996 followed by steady growth that culminated in the $25 million acquisition of Florida-based DiscoCare Inc. in January 2008. But four months later, things began to unravel when a class action lawsuit alleged that ArthroCare profited from providing misleading financial information. The lawsuit and subsequent SEC investigation prompted a steady decline in the company’s stock value.
