Rochester Medical Reports Third Quarter Results
Published: Jul 30, 2012
STEWARTVILLE, Minn., July 26, 2012 /PRNewswire/ -- Rochester Medical Corporation (NASDAQ:ROCM) today announced operating results for its third quarter ended June 30, 2012.
The Company reported sales of $15,252,000 for the current quarter compared to $14,281,000 for the third quarter of last year. It also reported net income of $496,000 or $0.04 per diluted share compared to net loss of ($294,000) or ($0.02) per diluted share for the same quarter of last year.
The approximate 7% increase (10% on a constant currency basis) in sales resulted from a 5% increase in Rochester Medical Direct Sales (9% on a constant currency basis) and a 16% increase in Private Label Sales (16% on a constant currency basis). Direct Sales include sales made directly to the end consumer and include all Rochester branded sales, U.K. Script Easy sales, and all Laprolan sales. Constant currency basis assumes current exchange rates for all periods in order to exclude the impact of foreign exchange variations. In the third quarter of fiscal 2012, the U.S. dollar was stronger versus the pound sterling and the Euro, thus negatively affecting Rochester Medical Direct Sales by $425,000 due to foreign currency translations.
Net income adjusted for certain non-recurring unusual items and certain recurring non-cash expenses, or "Non-GAAP Net Income" for the current quarter was $838,000 or $0.07 per diluted share compared to Non-GAAP Net Income of $442,000 or $0.04 per diluted share for the third quarter of last year. The increase for the current quarter is primarily due to increased gross profits as a result of increased sales.
Commenting on the quarter results, Rochester Medical's CEO and President Anthony J. Conway said, "The Company's direct business is doing very well, especially in the United States and United Kingdom. U.S. Direct Sales grew 34% and U.K. Direct Sales rose 13% (17% on a constant currency basis). European sales fell below our expectations with Laprolan sales down 17% (6% on a constant currency basis), and the rest of Europe and the Middle East (EME) down 32%. The decline in EME sales is due primarily to the timing of orders, which we expect will rebound in the next quarter. We believe our recent investments to strengthen the Laprolan team will begin to produce significant gains by mid fiscal 2013. Looking ahead we expect a strong final quarter for fiscal 2012 and increasing top and bottom line strength in fiscal 2013."
Conference Call and Webcast
The Company will hold a quarterly conference call tomorrow (July 27, 2012) to discuss its earnings report. The call will begin at 10:00 a.m. central time (11:00 a.m. eastern time).
This call is being webcast by Thomson Reuters and can be accessed at Rochester Medical's website at www.rocm.com. To listen live to the conference call via telephone, call:
Replay will be available for seven days at www.rocm.com or via telephone at:
Individual investors can listen to the call at www.fulldisclosure.com, Thomson Reuters individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson's password-protected event management site, StreetEvents (www.streetevents.com).
This press release contains "forward-looking statements" with the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the future financial and operating results of Rochester Medical. Such statements are based on currently available information, operating plans and management's expectations about future events and trends. Such statements inherently involve significant risks and uncertainties that could cause actual results to differ materially from those predicted in such forward-looking statements, including the uncertainty of estimated revenues and profits, the uncertainty of current domestic and international economic conditions that could adversely affect the level of demand for the Company's products and increased volatility in foreign exchange rates, the uncertainty of market acceptance of new product introductions, and our level of success in increasing Rochester Medical Direct Sales revenue, the uncertainty of gaining new strategic relationships or locating and capitalizing on strategic opportunities, the uncertainty of timing of Private Label Sales revenues (particularly international customers), FDA and other regulatory review and response times, and other risk factors listed from time to time in the Company's SEC reports and filings, including, without limitation, the section entitled "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended September 30, 2011, and quarterly reports on Forms 10-Q. Readers are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date they are made. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
Use of Non-GAAP Financial Measures
Rochester Medical has provided Non-GAAP Net Income in addition to net income calculated in accordance with generally accepted accounting principles (GAAP) because management believes Non-GAAP Net Income provides a more consistent basis for comparisons that are not influenced by certain charges and non-cash expenses and are therefore helpful in understanding Rochester Medical's underlying operating results. Similarly, constant currency represents reported sales with the cost/benefit of currency movements removed. Management uses the measure to understand the growth of the business on a constant dollar basis, as fluctuations in exchange rates can distort the underlying growth of the business both positively and negatively. While we recognize that foreign exchange volatility is a reality for a global company, we routinely review our Company performance on a constant dollar basis, and we believe this also allows our shareholders to understand better our Company's growth trends.
Non-GAAP Net Income and constant currency are not measures of financial performance under GAAP, and should not be considered an alternative to net income or any other measure of performance or liquidity under GAAP. Non-GAAP Net Income and constant currency are not comparable to information provided by other companies. Non-GAAP Net Income and constant currency have limitations as analytical tools and should not be considered in isolation or as a substitution for analysis of our results as reported under GAAP. Reconciliations of GAAP Net Income and Non-GAAP Net Income, and reconciliations of sales under GAAP and sales on a constant currency basis, are presented at the end of this press release.
About Rochester Medical Corporation
Rochester Medical Corporation develops, manufactures, and markets disposable medical catheters and devices for urological and continence care applications. The Company also sells certain ostomy and wound and scar care products and other brands of urological products into the European marketplace.
For further information, please contact Anthony J. Conway, President and Chief Executive Officer or David A. Jonas, Chief Financial Officer of Rochester Medical Corporation at (507) 533-9600 or Parice Halbert, CFA, at Westwicke Partners (443) 213-0500. More information about Rochester Medical is available on its website at http://www.rocm.com.