EXTON, Pa., Feb. 1, 2011 /PRNewswire/ -- Kensey Nash Corporation (Nasdaq: KNSY), a medical device company primarily focused on regenerative medicine for a wide range of medical procedures, today reported the results for its second quarter ended December 31, 2010.
Second Quarter Snapshot and Recent Developments
- Diluted EPS of $0.38, in line with the Company’s previous guidance of $0.37-$0.40, and representing an increase from the prior year comparable quarter’s diluted EPS of $0.32 and a decrease from the prior year comparable quarter’s adjusted diluted EPS*of $0.43.
- Revenue of $17.4 million, in line with the Company’s previous guidance of $17.0-$17.8 million and representing a decrease from the prior year comparable quarter’s revenue of $19.1 million.
- Net sales of $10.9 million, in line with the Company’s previous guidance of $10.3-$11.0 million and representing a decrease from the prior year comparable quarter’s net sales of $12.5 million.
- Royalty income of $6.5 million, below the Company’s previous guidance of $6.7-$6.8 million and representing a decrease from the prior year comparable quarter’s royalty income of $6.6 million.
- Operating margin of 29%.
- Cash from operations of $2.2 million in the quarter.
- EBITDA* of $6.8 million.
- Entered into a manufacturing agreement with, and made a minority equity investment in, Orteq Sports Medicine, a medical device company specializing in the field of biodegradable polymer technology for meniscus repair.
- Signed distribution agreement with Arthrex, Inc. for the European distribution of the Company’s Cartilage Repair Device.
- Acquired the net assets of Nerites Corporation, a developer of medical adhesives and anti-fouling coatings (See the Company’s January 31, 2011 press release).
President and CEO Commentary
“Although our second quarter results were in line with our expectations, the issues of high unemployment and a challenging health insurance environment continue to impact our industry. However, the inventory reduction efforts by some of our larger customers are subsiding, as we are beginning to experience an increase in orders which should improve our results for the balance of the fiscal year,” commented Joe Kaufmann, President and CEO of the Company. “We expect our sports medicine and spine product sales will increase by approximately 30% and 50% sequentially in our third quarter. Overall, sales of our biomaterials products are expected to increase by an amount in the range of 8% to 10% sequentially in our third quarter despite an anticipated decline in cardiology collagen sales to St. Jude Medical of approximately 25%. Furthermore, we are optimistic that our fourth quarter will continue to show growth in our biomaterial business due to the ongoing expansion of the ECM products distributed by our strategic partner, Synthes, as well as an improvement in the overall business climate.”
Supplemental Sales Data. Details of the Company’s net sales for the three and six months ended December 31, 2010 and 2009 are summarized below.
Three Months Ended | Year over | Six Months Ended | Year over | ||||
($ millions) | 2010 | 2009 | 2010 | 2009 | |||
Biomaterials Products | |||||||
Orthopaedic Products | |||||||
Sports Medicine Products | $2.6 | $3.1 | (14%) | $5.3 | $6.7 | (20%) | |
Spine Products | 2.0 | 2.8 | (30%) | 4.5 | 5.6 | (19%) | |
Other Orthopaedic Products | 0.2 | 0.1 | 34% | 0.3 | 0.2 | 23% | |
Total Orthopaedic Products | $4.8 | $6.0 | (20%) | $10.1 | $12.5 | (19%) | |
Cardiovascular Products | 4.1 | 4.3 | (5%) | 8.4 | 9.3 | (10%) | |
General Surgery Products | 1.4 | 1.1 | 29% | 2.0 | 2.2 | (11%) | |
Other Biomaterial Products | 0.3 | 0.2 | 73% | 0.6 | 0.2 | n/a | |
Biomaterials Products | $10.6 | $11.6 | (9%) | $21.1 | $24.2 | (13%) | |
Endovascular Products | $0.3 | $0.8 | (68%) | $0.7 | $1.7 | (57%) | |
Total Net Sales | $10.9 | $12.5 | (13%) | $21.8 | $25.9 | ||
