Published: February 14, 2012
Masimo Reports Fourth Quarter and Full Year 2011 Financial Results; Provides 2012 Financial Guidance
IRVINE, Calif., Feb. 14, 2012 /PRNewswire/ -- Masimo (NASDAQ: MASI) today announced its financial results for the fourth quarter and year ended December 31, 2011.
Masimo's total fourth quarter revenue, including royalties, rose 6% to $112.3 million, compared to $105.6 million for the fourth quarter of 2010. Fourth quarter 2011 product revenue rose 12% to $104.7 million, compared to $93.8 million for the fourth quarter of 2010. For the fourth quarter of 2011, the company's worldwide end-user business grew 17% and represented 86% of product revenue. OEM sales, which represented the remaining 14% of product revenue, declined 12% in the fourth quarter of 2011, compared to the same period in 2010. Revenue from Masimo rainbow product sales rose 16% to $9.8 million in the fourth quarter, compared to $8.4 million for the fourth quarter of 2010.
Net income for the fourth quarter was $13.8 million, or $0.23 per diluted share, compared to reported net income of $16.1 million, or $0.26 per diluted share, in the fourth quarter of 2010. Excluding one-time expenses in the year-ago period, Masimo's adjusted net income and adjusted earnings per share for the fourth quarter of 2010 were $17.5 million and $0.29, respectively.
For 2011, Masimo's total revenue rose 8% to $439.0 million, compared to $405.4 million in 2010. The company's product revenue rose 14% to $406.5 million, compared to $356.4 million in 2010. Revenue from Masimo rainbow products rose 4% to $34.1 million, compared to $32.9 million in 2010. Excluding the $4.0 million U.S. military order in 2010 that did not repeat in 2011, rainbow revenue grew by 18%. Royalty revenue declined from $49.0 million in 2010 to $32.5 million in 2011.
Masimo's net income for 2011 was $63.7 million, or $1.05 per diluted share, compared to 2010 net income of $73.5 million, or $1.21 per diluted share, which included $0.18 from the net of a one-time gain related to $30.8 million in antitrust proceeds from Covidien and offset by $14.7 million in one-time expenses. Excluding one-time items in 2010, Masimo's 2010 adjusted net income and adjusted earnings per share were $62.5 million and $1.03, respectively.
During the fourth quarter, the company shipped approximately 34,400 Masimo SET pulse oximetry and Masimo rainbow SET Pulse CO-Oximetry units, excluding handheld units, down 18% compared to approximately 41,800 in the same prior-year period. For 2011, Masimo shipped approximately 148,200 Masimo SET pulse oximetry and Masimo rainbow SET Pulse CO-Oximetry units, excluding handheld units, down 2% compared to approximately 153,200 in 2010. Masimo estimates its worldwide installed base as of December 31, 2011 to be 979,000 units, up 15% from 855,000 units as of January 1, 2011.
Joe Kiani, Chairman and Chief Executive Officer of Masimo, said, "Masimo finished 2011 with a 12% rise in fourth quarter product revenue, including 17% growth in our direct business. Strong double-digit sales growth in our U.S. acute care channel and international business, as well as a 16% increase in rainbow revenue, drove our product revenue performance in the quarter. We also grew our worldwide installed base by 15%, expanding our global reach and demonstrating the continuing demand for our superior Masimo SET pulse oximetry and rainbow SET Pulse CO-Oximetry technology."
As of December 31, 2011, cash and cash equivalents were $129.9 million, compared to $88.3 million as of January 1, 2011. During the fourth quarter, the company used approximately $36 million in cash to purchase approximately 1.8 million shares of its common stock under a stock repurchase program authorized by the Board of Directors in mid-2011.
2012 Financial Guidance
Masimo expects fiscal 2012 total revenue to be approximately $483 million, including product revenue of $455 million and royalty revenue of $28 million. Included within the 2012 product revenue guidance is a rainbow revenue expectation of $45 million. The company expects fiscal 2012 GAAP earnings per share to be $1.20. Each of the components of Masimo's guidance set forth above is an estimate only and actual performance could differ.
Conference Call
Masimo will hold a conference call today at 1:30 p.m. PT (4:30 p.m. ET) to discuss the results. A live webcast of the conference call will be available online from the investor relations page of the company's corporate website at www.masimo.com. The dial-in numbers are (888) 520-7182 for domestic callers and +1 (706) 758-3929 for international callers. The reservation code for both dial-in numbers is 42982286. After the live webcast, the call will be available on Masimo's website through March 14, 2012. In addition, a telephonic replay of the call will be available through February 28, 2012. The replay dial-in numbers are (800) 585-8367 for domestic callers and +1 (855) 859-2056 for international callers. Please use reservation code 42982286
About Masimo
Masimo (NASDAQ: MASI) is the global leader in innovative noninvasive monitoring technologies that significantly improve patient care--helping solve "unsolvable" problems. In 1995, the company debuted Measure-Through Motion and Low Perfusion pulse oximetry, known as Masimo SET®, which virtually eliminated false alarms and increased pulse oximetry's ability to detect life-threatening events. More than 100 independent and objective studies demonstrate Masimo SET provides the most reliable SpO2 and pulse rate measurements even under the most challenging clinical conditions, including patient motion and low peripheral perfusion. In 2005, Masimo introduced rainbow® SET Pulse CO-Oximetry(TM) technology, allowing noninvasive and continuous monitoring of blood constituents that previously required invasive procedures, including total hemoglobin (SpHb®), oxygen content (SpOC(TM)), carboxyhemoglobin (SpCO®), methemoglobin (SpMet®), and Pleth Variability Index (PVI®), in addition to SpO2, pulse rate, and perfusion index (PI). In 2008, Masimo introduced Patient SafetyNet(TM), a remote monitoring and wireless clinician notification system designed to help hospitals avoid preventable deaths and injuries associated with failure to rescue events. In 2009, Masimo introduced rainbow Acoustic Monitoring(TM), the first-ever noninvasive and continuous monitoring of acoustic respiration rate (RRa(TM)). Masimo's rainbow SET technology platform offers a breakthrough in patient safety by helping clinicians detect life-threatening conditions and helping guide treatment options. In 2010, Masimo acquired SEDLine®, a pioneer in the development of innovative brain function monitoring technology and devices. Masimo SET and Masimo rainbow SET technologies can also be found in over 100 multiparameter patient monitors from over 50 medical device manufacturers around the world. Founded in 1989, Masimo has the mission of "Improving Patient Outcomes and Reducing Cost of Care ... by Taking Noninvasive Monitoring to New Sites and Applications®." Additional information about Masimo and its products may be found at www.masimo.com.
Forward-Looking Statements
All statements other than statements of historical facts included in this press release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements including, in particular, the statements about our financial condition, results of operations and business generally; expectations regarding our ability to design and deliver innovative new noninvasive technologies; demand for our technologies; and expectations for total revenue, royalty revenue and product revenue, including rainbow revenue, and GAAP earnings per share, for the full fiscal year 2012. These forward-looking statements are based on management's current expectations and beliefs and are subject to uncertainties and factors, all of which are difficult to predict and many of which are beyond our control and could cause actual results to differ materially and adversely from those described in the forward-looking statements. These risks include, but are not limited to, those related to: our dependence on Masimo SET and Masimo rainbow SET products and technologies for substantially all of our revenue; any failure in protecting our intellectual property exposure to competitors' assertions of intellectual property claims; the highly competitive nature of the markets in which we sell our products and technologies; any failure to continue developing innovative products and technologies; the lack of acceptance of any of our current or future products and technologies; obtaining regulatory approval of our current and future products and technologies; the risk that the implementation of our international realignment will not continue to produce anticipated operational and financial benefits, including a continued lower effective tax rate; the loss of our customers; the failure to retain and recruit senior management; product liability claims exposure; a failure to obtain expected returns from the amount of intangible assets we have recorded; the maintenance of our brand; the impact of the decline in the worldwide credit markets on us and our customers; the amount and type of equity awards that we may grant to employees and service providers in the future; and other factors discussed in the "Risk Factors" section of our most recent periodic reports filed with the Securities and Exchange Commission ("SEC"), including our most recent Form 10-K and Form 10-Q, all of which you may obtain for free on the SEC's website at www.sec.gov. Although we believe that the expectations reflected in our forward-looking statements are reasonable, we do not know whether our expectations will prove correct. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, even if subsequently made available by us on our website or otherwise. We do not undertake any obligation to update, amend or clarify these forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
Investor Contact: Sheree Aronson Media Contact: Dana Banks
Vice President, Investor Relations, Manager, Public Relations, Masimo
Masimo Corporation Corporation
(949) 297-7043 (949) 297-7348
saronson@masimo.com dbanks@masimo.com
Masimo, SET, Signal Extraction Technology, Improving Patient Outcome and Reducing Cost of Care... by Taking Noninvasive Monitoring to New Sites and Applications, Rainbow, SpHb, SpOC, SpCO, SpMet, PVI, Rainbow Acoustic Monitoring, RRa, Radical-7, Rad-87, Rad-57,Rad-8, Rad-5,Pulse CO-Oximetry, Pulse CO-Oximeter, and SEDLine are trademarks or registered trademarks of Masimo Corporation.
MASIMO CORPORATION
CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
December 31, January 1,
2011 2011
---- ----
ASSETS
Current assets
Cash and cash
equivalents $129,882 $88,305
Accounts
receivable, net of
allowance for
doubtful accounts 57,013 49,694
Royalties
receivable 7,102 12,000
Inventories 45,944 45,028
Prepaid expenses 6,424 4,535
Prepaid income
taxes 2,986 3,352
Deferred tax assets 11,576 12,555
Other current
assets 2,008 2,136
----- -----
Total current
assets 262,935 217,605
Deferred cost of
goods sold 51,679 47,184
Property and
equipment, net 15,239 15,951
Intangible assets,
net 11,393 10,497
Goodwill 448 448
Deferred tax assets 16,766 12,560
Other assets 7,644 5,990
--- ---
Total assets $366,104 $310,235
======== ========
LIABILITIES AND
EQUITY
Current liabilities
Accounts payable $27,302 $22,150
Accrued
compensation 19,717 21,074
Accrued liabilities 12,297 9,832
Income taxes
payable 570 722
Deferred revenue 16,019 16,369
Current portion of
capital lease
obligation 48 50
--- ---
Total current
liabilities 75,953 70,197
Deferred revenue 984 1,554
Capital lease
obligation, less
current portion 74 122
Other liabilities 9,427 8,323
--- ---
Total liabilities 86,438 80,196
Equity
Masimo Corporation
stockholders'
equity:
Common stock 58 59
Treasury stock (37,396) (1,209)
Additional paid-in
capital 243,528 222,206
Accumulated other
comprehensive
income 1,274 925
Retained earnings 69,364 5,664
---- ---
Total Masimo
Corporation
stockholders'
equity 276,828 227,645
Noncontrolling
interest 2,838 2,394
----- -----
Total equity 279,666 230,039
----- -----
Total liabilities
and equity $366,104 $310,235
======== ========
MASIMO CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(unaudited, in thousands, except per share amounts)
Three Months Ended Twelve Months Ended
------------------ -------------------
December 31, January 1, December 31, January 1,
2011 2011 2011 2011
---- ---- ---- ----
Revenue:
Product $104,716 $93,775 $406,487 $356,422
Royalty 7,625 11,799 32,501 48,985
--- ---- ---- ----
Total revenue 112,341 105,574 438,988 405,407
Cost of goods
sold 38,729 31,446 144,854 119,825
------ ------ ------- -------
Gross profit 73,612 74,128 294,134 285,582
Operating
expenses:
Selling,
general and
administrative 43,930 44,227 169,205 174,089
Research and
development 9,619 8,312 38,412 36,000
Antitrust
litigation
proceeds - - - (30,728)
--- --- --- -------
Total
operating
expenses 53,549 52,539 207,617 179,361
------ ------ ------- -------
Operating
income 20,063 21,589 86,517 106,221
Non-
operating
income
(expense) (468) 154 14 1,348
---- --- --- -----
Income before
provision
for income
taxes 19,595 21,743 86,531 107,569
Provision for
income taxes 5,429 5,112 22,478 34,164
----- ----- ------ ------
Net income
including
noncontrolling
interests 14,166 16,631 64,053 73,405
Net (income)
loss
attributable
to the
noncontrolling
interests (346) (517) (353) 125
---- ---- ---- ---
Net income
attributable
to Masimo
Corporation $13,820 $16,114 $63,700 $73,530
======= ======= ======= =======
Net income
per share
attributable
to Masimo
Corporation
stockholders:
Basic $0.23 $0.27 $1.07 $1.25
===== ===== ===== =====
Diluted $0.23 $0.26 $1.05 $1.21
===== ===== ===== =====
Weighted
average
shares used
in per share
calculations:
Basic 59,223 59,145 59,659 58,769
==== ==== ==== ====
Diluted 60,180 60,839 60,845 60,609
==== ==== ==== ====
Cash dividend
declared per
share $ - $0.75 $ - $2.75
=== === ===== === === =====
The following table presents details of the share-based compensation expense (benefit)
that is included in each functional line item in the consolidated
statements of income above (in thousands):
Three Months Ended Twelve Months Ended
------------------ -------------------
December 31, January 1, December 31, January 1,
2011 2011 2011 2011
---- ---- ---- ----
Cost of goods
sold $(36) $132 $383 $483
Selling,
general and
administrative 2,709 2,519 10,268 9,033
Research and
development 836 765 3,025 2,787
Total $3,509 $3,416 $13,676 $12,303
====== ====== ======= =======
MASIMO CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
Year ended Year ended
December
31, January 1,
2011 2011
---- ----
Cash flows from
operating
activities:
Net income
including
noncontrolling
interests $64,053 $73,405
Adjustments to
reconcile net
income including
noncontrolling
interests
to net cash
provided by
operating
activities:
Depreciation and
amortization 7,342 6,584
Share-based
compensation 13,676 12,303
Provision for
doubtful accounts 231 108
Provision for
obsolete inventory 2,130 619
Provision for
warranty costs 2,592 2,355
Provision for
deferred income
taxes (3,217) (2,231)
Income tax benefit
from exercise of
stock options
granted prior to
January 1, 2006 1,650 4,851
Excess tax benefit
from share-based
payment
arrangements (67) (707)
Changes in
operating assets
and liabilities:
Increase in
accounts
receivable (7,549) (10,905)
(Increase) decrease
in royalties
receivable 4,898 (500)
Increase in
inventories (3,046) (14,088)
Increase in
deferred cost of
goods sold (4,526) (19,080)
Increase in prepaid
expenses (1,874) (743)
(Increase) decrease
in prepaid income
taxes 366 (1,648)
Increase in other
assets (1,502) (1,396)
Increase in
accounts payable 5,159 5,474
Increase (decrease)
in accrued
compensation (1,333) 3,219
Decrease in accrued
liabilities (77) (2,281)
Increase (decrease)
in income taxes
payable (89) 940
Increase (decrease)
in deferred
revenue (921) 3,012
Increase in other
liabilities 1,061 1,729
----- -----
Net cash provided
by operating
activities 78,957 61,020
------ ------
Cash flows from
investing
activities:
Purchase of short-
term investments - (75,986)
Proceeds from sale
and maturities of
short-term
investments - 132,975
Purchases of
property and
equipment (5,057) (9,561)
Increase in
intangible assets (2,451) (1,937)
------ ------
Net cash provided
by (used in)
investing
activities (7,508) 45,491
------ ------
Cash flows from
financing
activities:
Repayments on long-
term debt (50) (60)
Proceeds from
issuance of common
stock 5,943 10,239
Excess tax benefit
from share-based
payment
arrangements 67 707
Dividends paid - (161,978)
Repurchases of
common stock (36,187) -
Short swing profit
recovery 73 -
--- ---
Net cash used in
financing
activities (30,154) (151,092)
------- --------
Effect of foreign
currency exchange
rates on cash 282 832
--- ---
Net increase
(decrease) in cash
and cash
equivalents 41,577 (43,749)
Cash and cash
equivalents at
beginning of
period 88,305 132,054
------ -------
Cash and cash
equivalents at end
of period $129,882 $88,305
======== =======
SOURCE Masimo Corporation
Copyright © 2012, PRNewswire
Copyright © 2012, NewsBlaze,
Daily News
Search News
