2320 NW 66th Ct.
• Gainesville
• Florida
• 32653
• USA
• www.exac.com
Investor Contact: Frank N. Hawkins, Jr. or Julie Marshall · Hawk Associates Inc. · (305) 451-1888 · www.hawkassociates.com
Investor Contact: Frank N. Hawkins, Jr. or Julie Marshall · Hawk Associates Inc. · (305) 451-1888 · www.hawkassociates.com
Q1 Revenue Up 9% to $43.3 Million. Net Income $2.5 M, EPS $0.19. Extremity Implant Revenue Up 57% to $5.8 M.
ALERT: Exactech's presentation at the Noble Financial Conference on June 8 is available for viewing using the link for Additional Information in the left hand column.
Exactech develops, manufactures, markets, distributes and sells its orthopaedic implant devices, including knee, shoulder, and hip implant systems, related surgical instrumentation, spine products and biologic services to hospitals and physicians in the United States and internationally in over 30 countries.
Founded and led by an orthopaedic surgeon, the company has built its success on its customer-centric culture. Feedback from its surgeon customers has helped Exactech develop a pipeline of innovative products that improve patient outcomes.
Company Overview
Q1 Segment Performance
• First quarter revenue increased 9% to $43.3 million• Net income excluding DOJ inquiry costs increased 12% to $3.3 million or $0.26 EPS
• Knee implant revenue remained unchanged at $18.5 million
• Hip implant revenue increased 3% to $6.5 million
• Biologic and Spine revenue increased 6% to $7.1 million
• Extremity implant revenue increased 57% to $5.8 million
• Other products revenue increased 19% to $5.4 million, including $2.3 million of other revenue from the French distributor acquired April 2008
Differentiators
FDA-CLEARED PRODUCTS AND SERVICES
It is estimated that there are nearly one million knee replacement procedures performed worldwide each year. To help meet this demand, Exactech continues to develop next generation knee systems that respond to the needs of the hospital and surgical community. Its Optetrak® differentiated knee implant products provide about 45% of the company's revenue.Representing about 10% of the company’s 2008 revenues, the Equinoxe® shoulder implant system is Exactech’s fastest growing product line.
Hip products account for about 14% of company revenues, and use industry-leading materials such as ceramic bearing surfaces and enhanced polyethylene for superior wear performance.
Exactech’s biologic and spine products together represent about 16% of revenue. The company began distribution of biologic tissue materials in 1998, and entered the spine market with an acquisition of a spine products company in early 2008. Exactech offers a variety of allograft tissue material for grafting and repairing bone defects, and a spine platform that provides a portfolio of spine products with the potential to expand domestically and internationally.
Surgeon input and clinician feedback is an important aspect in developing innovative new designs in implant technology. Recent News
Exactech to Present at the 2009 Noble Financial Equity Conference on June 8
Exactech Q1 Revenue Increases 9% to $43.3 Million
Exactech Schedules First Quarter 2009 Earnings Release and Conference Call
Pro Golfer Peter Jacobsen Endorses Exactech Knee Following Successful Knee Replacement
Exactech Receives Patent for Rotating Bearing Knee, Optetrak RBK System
- Market acceptance of new products
- Significant resources of larger competitors
- Market access to hospitals and surgeons
- Partial dependency on third-party manufacturers
- Medical device industry DOJ investigation
The Outlook Revenue for the first quarter of 2009 was $43.3 million, a 9% increase over $39.8 million in the first quarter of 2008. Net income was $2.5 million, or $0.19 per diluted share, compared to $2.8 million, or $0.23 per diluted share, in the same quarter a year ago. Net income for the quarter, excluding pre-tax legal expenses and costs of $1.4 million related to the ongoing Department of Justice (DOJ) inquiry, increased 12% to $3.3 million or $0.26 diluted EPS.
Sales from knee implants remained unchanged at $18.5 million for the first quarter of 2009. Hip implant sales for the first quarter were $6.5 million, a 3% increase from revenue of $6.4 million in the first quarter of 2008, due to domestic strength in our Novation® hip products. Biologic-spine revenue was up 6% to $7.1 million from $6.7 million in the same quarter last year. Extremity revenues increased to $5.8 million, a 57% increase from last year’s revenue of $3.7 million, as a result of the continued momentum of our Equinoxe® shoulder products. Other products increased 19% to $5.4 million.
Continued progress of the company's French distributor was the primary driver behind a 9% increase in international sales to $12.5 million from $11.5 million in the first quarter of 2008. International sales for the quarter remained at 29% of total sales, identical with last year. U.S. sales increased 9% to $30.8 million compared with $28.3 million in the first quarter of 2008.
Gross margins increased to 66.5% in 2009 from 62.9% in 2008, primarily as a result of a stable mix of domestic and international sales and continued benefit from internal manufacturing cost reduction efforts.
Looking forward, Exactech updated its revenue targets for 2009 to a range of $176 million to $184 million and diluted EPS for the year 2009 in the range of $1.02 to $1.08. For Q2 ending June 30, 2009, the company targets revenue in the range of $44 million to $46 million and diluted EPS in the range of $0.26 to $0.28. These EPS target ranges exclude the impact of DOJ inquiry costs. The foregoing statements regarding targets for the quarter and full year are forward-looking and actual results may differ materially. These are the company’s targets, not predictions of actual performance.
Management
Chairman and Chief Executive Officer-
William
Petty, M.D.
President and Director-
David
W.
Petty
CFO-
Joel
C.
Phillips, CPA
EVP of Research and Development, Director-
Gary
J.
Miller, Ph.D.
VP of Administration and Human Resources, Secretary-
Betty
B.
Petty
Senior Vice President, General Manager – Biologics Division-
Bruce
Thompson
Director-
James
G.
Binch
Director-
Albert
H
Burstein, Ph.D.
Director-
R.
Wynn
Kearney, Jr.
, M.D.
Director-
William
B.
Locander, Ph.D.
Director-
Paul
E.
Metts, CPA
