HAYWARD, Calif., July 26, 2012 /PRNewswire/ -- Solta Medical, Inc. (NASDAQ: SLTM), a global leader in the medical aesthetics market, today announced results for the second quarter ended June 30, 2012. Revenue for the second quarter was $37.3 million, an increase of $8.3 million, or 29%, as compared to the second quarter of 2011. Revenue from Liposonix, the Company’s non-invasive fat reduction system, was $9.4 million, which was generated from shipments of 98 systems and associated consumables. Total revenue from treatment tips and consumables for the quarter was $18.2 million, representing 49% of total revenue. Revenue from the Asia Pacific region grew 32% year-over-year driven primarily from sales of the Company’s Thermage® and Clear + Brilliant® brands.
“Liposonix continues to gain traction in the market place and in order to meet demand, we ramped production of Liposonix systems by 40% during the quarter and doubled the production of transducer treatment tips. We expect to increase production over the balance of the year to meet the anticipated demand,” said Stephen J. Fanning, Chairman, President & CEO. “Approximately three-quarters of the available Liposonix product was shipped to customers in North America in Q2. We look forward to expanding our Liposonix commercialization efforts in markets outside of North America over the remainder of the year.”
GAAP net loss for the quarter was $26.3 million as compared to GAAP net loss of $0.2 million reported for the second quarter of 2011. Non-GAAP net income for the quarter was $2.7 million, or $0.04 per diluted share as compared to non-GAAP net income of $1.4 million, or $0.02 per diluted share for same period last year.
Solta Medical’s GAAP results for the second quarter include a $26.0 million charge for a fair value reassessment of the expected earn out payments associated with the acquisition of Liposonix. The total contingent consideration, which includes expected payments over the next seven years, has been increased by $26.0 million to $58.5 million, and is shown on the Company’s June 30, 2012 balance sheet as a short-term liability of $22.2 million and a long-term liability of $36.3 million. The Company’s GAAP results for the quarter also include $1.8 million of non-cash amortization and other acquisition related charges, and $1.2 million of non-cash stock based compensation charges. The Company provides non-GAAP financial measures that exclude these charges and expenses. A reconciliation of GAAP to non-GAAP results is provided in the tables included in this release.
“We produced our eleventh consecutive quarter of positive non-GAAP EBITDA and generated $4.0 million in cash flow from operations,” said Mr. Fanning. “In addition, non-GAAP operating income of $3.2 million for the second quarter more than doubled from $1.5 million in the prior year, demonstrating our ability to leverage our operating infrastructure.”
Also today the Company announced that it has signed a Commitment Letter from Silicon Valley Bank for a new $10 million term loan. Upon closing and funding, this term loan will provide the Company with additional capital to continue to drive growth and to address future obligations related to the Liposonix acquisition.
“We believe the additional $10 million term loan provides us with sufficient liquidity to support our operations through the next 12 months, including the 2013 contingent payments related to the acquisition of Liposonix. Nonetheless, we will continue to evaluate opportunities to strengthen our balance sheet,” Mr. Fanning concluded.
Financial Outlook for 2012
The company updated its financial outlook for 2012 as follows:
- Revenue for the full year 2012 is now expected to be in the range of $142 million to $144 million, representing year-over-year revenue growth of 22% to 24%, driven by sales of the second generation Liposonix system. The Company previously provided a revenue outlook for full year 2012 in the range of $140 million to $143 million.
- Non-GAAP gross margin is now estimated to be in the range of 64% to 67% for the full year 2012 as compared to the Company’s previously issued range of 63% to 66%. Non-GAAP gross margin excludes non-cash amortization charges, non-cash stock based compensation charges, severance costs, and acquisition related adjustments. Non-GAAP gross margin for the six months ended June 30, 2012 was 67.5%.
- The outlook for positive non-GAAP EBITDA for every quarter and for the full-year 2012 remains unchanged. Non-GAAP EBITDA excludes non-cash amortization charges, non-cash stock based compensation charges, severance costs, and acquisition related adjustments. Non-GAAP EBITDA for the six months ended June 30, 2012 was $4.7 million.
Non-GAAP Presentation
To supplement the condensed consolidated financial information presented on a GAAP basis, management has provided non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP EBITDA, non-GAAP net income (loss) and non-GAAP earnings (loss) per share measures that exclude the impact of acquisition related adjustments, severance costs, acquisition related costs, and stock-based compensation expenses. The Company believes that these non-GAAP financial measures provide investors with insight into what is used by management to conduct a more meaningful and consistent comparison of the Company’s ongoing operating results and trends, compared with historical results. This presentation is also consistent with the measures management uses to measure the performance of ongoing operating results against prior periods and against our internally developed targets. There are limitations in using these non-GAAP financial measures because they are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. These non-GAAP financial measures should not be considered in isolation or as a substitute for GAAP financial measures. Investors and potential investors should consider non-GAAP financial measures only in conjunction with the Company’s consolidated financial statements prepared in accordance with GAAP and the reconciliation of non-GAAP financial measures attached to this release.
Conference Call Information
The Company will also host a conference call and webcast today, Thursday, July 26, 2012, at 4:30 p.m. Eastern Time (1:30 p.m. Pacific) to discuss the financial results and current corporate developments. The dial-in number for the conference call is 877-941-9205 for domestic participants and 480-629-9819 for international participants.
To access the live webcast of the call, go to Solta Medical’s website at www.solta.com and click on Investor Relations. An archived webcast will also be available at www.solta.com.
About Solta Medical, Inc.
Solta Medical, Inc. is a global leader in the medical aesthetics market providing innovative, safe, and effective solutions for patients that enhance and expand the practice of medical aesthetics for physicians. The company offers six aesthetic energy devices to address a range of issues, including skin resurfacing and rejuvenation with Fraxel® and Clear + Brilliant, body contouring and skin tightening with Liposonix® and Thermage® and acne reduction with Isolaz® and CLARO. As the innovator and leader in fractional laser technology, Fraxel delivers minimally invasive clinical solutions to resurface aging and sun damaged skin. Using similar fractional laser technology, Clear + Brilliant is a unique, cost-effective treatment to prevent and improve the early signs of photoaging. For body contouring, Liposonix is a non-surgical treatment to reduce waist circumference with advanced high-intensity focused ultrasound (HIFU) technology to permanently destroy targeted fat beneath the skin. Thermage is an innovative, non-invasive radiofrequency procedure for tightening and contouring skin. Isolaz was the first laser or light based system indicated for the treatment of inflammatory acne, comedonal acne, pustular acne, and mild-to-moderate inflammatory acne. CLARO is a personal care acne system that is the first FDA cleared over-the-counter IPL device that uses a powerful combination of both heat and light to clear skin quickly and naturally. More than two million procedures have been performed with Solta Medical’s portfolio of products around the world. For more information about Solta Medical, call 1-877-782-2286 or log on to www.Solta.com.
