Utah Medical Products (UTMD) 10-Q 6 Nov 13 2013 Q3 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information (USD $)	9 Months Ended
	Sep. 30, 2013	Nov. 05, 2013	Jun. 30, 2013
Document and Entity Information:	'	'	'
Entity Registrant Name	'UTAH MEDICAL PRODUCTS INC	'	'
Document Type	'10-Q	'	'
Document Period End Date	30-Sep-13	'	'
Amendment Flag	'false	'	'
Entity Central Index Key	'0000706698	'	'
Current Fiscal Year End Date	'--12-31	'	'
Entity Common Stock, Shares Outstanding	'	3,739,800	'
Entity Public Float	'	'	$177,627,000
Entity Filer Category	'Accelerated Filer	'	'
Entity Current Reporting Status	'Yes	'	'
Entity Voluntary Filers	'No	'	'
Entity Well-known Seasoned Issuer	'No	'	'
Document Fiscal Year Focus	'2013	'	'
Document Fiscal Period Focus	'Q3	'	'

UTAH_MEDICAL_PRODUCTS_INC_CONS

UTAH MEDICAL PRODUCTS, INC. CONSOLIDATED BALANCE SHEET (USD $)	Sep. 30, 2013	Dec. 31, 2012
In Thousands, unless otherwise specified
Current assets:	'	'
Cash	$13,870	$8,871
Investments, available-for-sale	52	42
Accounts & other receivables - net	4,963	4,341
Inventories	4,660	4,353
Other current assets	986	929
Total current assets	24,531	18,535
Property and equipment - net	8,279	8,428
Goodwill	15,448	15,488
Other intangible assets	41,059	41,242
Other intangible assets - accumulated amortization	-8,719	-6,758
Other intangible assets - net	32,341	34,484
TOTAL ASSETS	80,599	76,935
Current liabilities:	'	'
Accounts payable	1,211	1,000
Accrued expenses	4,029	2,821
Current portion of notes payable	3,989	4,001
Total current liabilities	9,229	7,823
Notes payable	5,983	9,003
Deferred tax liability - intangible assets	7,432	7,889
Other long term liabilities	0	363
Deferred income taxes	878	884
TOTAL LIABILITIES	23,523	25,963
Stockholders' equity:	'	'
Preferred stock - $.01 par value; authorized - 5,000 shares; no shares issued or outstanding	'	'
Common stock - $.01 par value; authorized - 50,000 shares; issued - September 30, 2013, 3,738 shares and December 31, 2012, 3,703 shares	37	37
Accumulated other comprehensive loss	-769	-851
Additional paid-in capital	3,090	2,268
Retained earnings	54,717	49,519
Total stockholders' equity	57,076	50,972
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$80,599	$76,935

UTAH_MEDICAL_PRODUCTS_INC_CONS1

UTAH MEDICAL PRODUCTS, INC. CONSOLIDATED BALANCE SHEET (Parenthetical) (USD $)	Sep. 30, 2013	Dec. 31, 2012
In Thousands, except Per Share data, unless otherwise specified
Statement of Financial Position	'	'
Preferred Stock, Par Value	$0.01	$0.01
Preferred Stock, Shares Authorized	5,000	5,000
Preferred Stock, Shares Issued	'	'
Preferred Stock, Shares Outstanding	'	'
Common Stock, Par Value	$0.01	$0.01
Common Stock, Shares Authorized	50,000	50,000
Common Stock, Shares Issued	3,738	3,703
Common Stock, Shares Outstanding	3,738	3,703

UTAH_MEDICAL_PRODUCTS_INC_CONS2

UTAH MEDICAL PRODUCTS, INC. CONSOLIDATED STATEMENT OF INCOME AND COMPREHENSIVE INCOME (USD $)	3 Months Ended		9 Months Ended
In Thousands, except Per Share data, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Income Statement	'	'	'	'
Sales, net	$10,032	$10,489	$30,408	$31,719
Cost of goods sold	4,083	4,012	12,130	12,433
Gross profit	5,949	6,477	18,279	19,286
Operating expense:	'	'	'	'
Selling, general and administrative	2,159	2,376	6,641	7,226
Research and development	126	140	368	433
Total operating expense	2,285	2,517	7,009	7,660
Operating income	3,665	3,960	11,269	11,627
Other income (expense)	-88	-111	-279	-411
Income before provision for income taxes	3,577	3,849	10,991	11,215
Provision for income taxes	1,006	1,128	3,052	3,305
Net income	2,571	2,721	7,938	7,910
Earnings per common share (basic)	$0.69	$0.74	$2.13	$2.15
Earnings per common share (diluted)	$0.68	$0.73	$2.11	$2.13
Shares outstanding (basic)	3,735	3,689	3,724	3,672
Shares outstanding (diluted)	3,781	3,726	3,771	3,706
Other comprehensive income:	'	'	'	'
Foreign currency translation net of taxes of $0 in all periods	2,573	1,099	76	1,343
Unrealized gain on investments net of taxes of $0, $4, $4 and $6	0	6	6	10
Total comprehensive income	$5,145	$3,825	$8,020	$9,263

UTAH_MEDICAL_PRODUCTS_INC_CONS3

UTAH MEDICAL PRODUCTS, INC. CONSOLIDATED STATEMENT OF INCOME AND COMPREHENSIVE INCOME (Parenthetical) (USD $)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Income Statement	'	'	'	'
Foreign currency translation tax adjustment	$0	$0	$0	$0
Unrealized gain (loss) on investments tax adjustment	$0	$4	$4	$6

UTAH_MEDICAL_PRODUCTS_INC_CONS4

UTAH MEDICAL PRODUCTS, INC. CONSOLIDATED CONDENSED STATEMENT OF CASH FLOW (USD $)	9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012
Statement of Cash Flows	'	'
Net income	$7,938	$7,910
Adjustments to reconcile net income to net cash provided by operating activities:	'	'
Depreciation	459	494
Amortization	1,913	1,957
(Gain) loss on investments	0	0
Provision for (recovery of) losses on accounts receivable	5	10
Deferred income taxes	-567	-613
(Gain)/Loss on disposal of assets	6	'
Stock-based compensation expense	21	54
Changes in operating assets and liabilities:	'	'
Accounts receivable - trade	-489	-140
Accrued interest and other receivables	-170	-111
Inventories	-205	336
Prepaid expenses and other current assets	19	-88
Accounts payable	226	232
Accrued expenses	315	531
Deferred revenue	-75	-75
Other liability	-339	0
Total adjustments	1,120	2,588
Net cash provided by operating activities	9,058	10,499
Capital expenditures for property and equipment	-222	-195
Capital expenditures for intangible assets	-5	-1
Purchases of investments	'	'
Proceeds from sale of investments	'	'
Net cash (used in) provided by investing activities	-227	-197
Proceeds from issuance of common stock - options	647	1,185
Common stock purchased and retired	0	0
Payment of taxes for exchange of stock options	-90	0
Tax benefit attributable to exercise of stock options	241	99
Repayment of notes payable	-2,909	-7,174
Payment of dividends	-1,824	-1,762
Net cash (used in) provided by financing activities	-3,935	-7,652
Effect of exchange rate changes on cash	103	103
NET INCREASE IN CASH	4,999	2,754
CASH AT BEGINNING OF PERIOD	8,871	6,534
CASH AT END OF PERIOD	13,870	9,288
Cash paid during the period for income taxes	2,662	2,621
Cash paid during the period for interest	$341	$516

Basis_of_Presentation

Basis of Presentation	9 Months Ended
	Sep. 30, 2013
Notes	'
Basis of Presentation	'
	(1)           The unaudited financial statements have been prepared in accordance with the instructions to form 10-Q and do not include all of the information and note disclosures required by accounting principles generally accepted in the United States.  These statements should be read in conjunction with the financial statements and notes included in the Utah Medical Products, Inc. ("UTMD" or "the Company") annual report on form 10 K for the year ended December 31, 2012.  In the opinion of management, the accompanying financial statements include all adjustments (consisting only of normal recurring adjustments) necessary to summarize fairly the Company's financial position and results of operations.  Currency amounts are in thousands except per-share amounts, and where noted.

Inventories

Inventories	9 Months Ended
	Sep. 30, 2013
Notes	'
Inventories	'
	(2)    Inventories at September 30, 2013 and December 31, 2012 consisted of the following:
			30-Sep-13		31-Dec-12
	Finished goods	$	1,474	$	1,630
	Work-in-process		932		938
	Raw materials		2,254		1,785
	Total	$	4,660	$	4,353

StockBased_Compensation

Stock-Based Compensation	9 Months Ended
	Sep. 30, 2013
Notes	'
Stock-Based Compensation	'
	(3)           Stock-Based Compensation.  At September 30, 2013, the Company has stock-based employee compensation plans which authorize the grant of stock options to eligible employees and directors.  The Company accounts for stock compensation under FASB Accounting Standards Codification (“ASC”) 718, Stock Compensation.  This statement requires the Company to recognize compensation cost based on the grant date fair value of options granted to employees and directors.  In the quarters ended September 30, 2013 and 2012, the Company recognized $7 and $16 , respectively, in stock-based compensation cost.  In the nine months ended September 30, 2013 and 2012, the Company recognized $21 and $54, respectively, in stock-based compensation cost.

Notes_Payable

Notes Payable	9 Months Ended
	Sep. 30, 2013
Notes	'
Notes Payable	'
	(4)  Notes payable.  In March, 2011, UTMD obtained a $14,000 loan from JPMorgan Chase Bank, N.A. (Chase), to help finance the purchase price of Femcare. The terms and conditions of the loan require UTMD to a) repay the loan in equal monthly payments over 5 years, b) pay interest based on the 30-day LIBOR rate plus a margin starting at 2.80% and ranging from 2.00% to 3.75%, depending on the ratio of its funded debt to EBITDA (Leverage Ratio), c) pledge 65% of all foreign subsidiaries’ stock, d) provide first priority liens on all domestic business assets, e) maintain its Interest Coverage Ratio at 1.05 to 1.00 or better, f) maintain its Tangible Net Worth (TNW) above a minimum threshold 20% below UTMD’s TNW at closing on March 18, and g) maintain its Leverage Ratio at 2.75 to 1.00 or less.  UTMD is in compliance with all of the loan financial covenants at September 30, 2013.  Based on UTMD’s financial position, the bank’s margin was 2.00% at September 30, 2013.  The principal balance on this note at September 30, 2013 was $3,500.
	In March 2011, the Company also obtained a $12,934 loan from JP Morgan Chase, London Branch, to help finance UTMD’s purchase of Femcare. Terms and conditions of the loan are the same as those listed above for the $14,000 U.S. loan.  The principal balance on this note at September 30, 2013 was $6,472.

Warranty_Reserve

Warranty Reserve	9 Months Ended
	Sep. 30, 2013
Notes	'
Warranty Reserve	'
	(5)   Warranty Reserve.   The Company’s published warranty is: “UTMD warrants its products to conform in all material respects to all published product specifications in effect on the date of shipment, and to be free from defects in material and workmanship for a period of thirty (30) days for supplies, or twenty-four (24) months for equipment, from date of shipment.  During the warranty period UTMD shall, at its option, replace any products shown to UTMD's reasonable satisfaction to be defective at no expense to the Purchaser or refund the purchase price.”
	UTMD maintains a warranty reserve to provide for estimated costs which are likely to occur. The amount of this reserve is adjusted, as required, to reflect its actual experience. Based on its analysis of historical warranty claims and its estimate that existing warranty obligations are immaterial, no warranty reserve was made at December 31, 2012 or September 30, 2013.

Investments

Investments	9 Months Ended
	Sep. 30, 2013
Notes	'
Investments	'
	(6)   Investments.  Changes in the unrealized holding gain/loss on investment securities available-for-sale and reported as a separate component of accumulated other comprehensive income are as follows:
			3Q 2013		3Q 2012
	Balance, beginning of period	$	5	$	(188)
	Realized loss from securities included in beginning balance		~		~
	Gross unrealized holding gains (losses), in equity securities		1		8
	Deferred income taxes on unrealized holding (gain) loss		~		-3
	Balance, end of period	$	6	$	(183)

Fair_Value_Measurements

Fair Value Measurements	9 Months Ended
	Sep. 30, 2013
Notes	'
Fair Value Measurements	'
	(7)  Fair Value Measurements.  The Company follows ASC 820, Fair Value Measurements and Disclosures to determine fair value of its financial assets.  The following table provides financial assets carried at fair value measured as of September 30, 2013:
				Fair Value Measurements Using
	Description		Total Fair Value		Quoted Prices		Significant Other		Significant
			at 9/30/2013		in Active Markets		Observable Inputs		Unobservable Inputs
					for Identical Assets		(Level 2)		(Level 3 )
					(Level 1)
	Common stock	$	52	$	52	$	0	$	0

Subsequent_Events

Subsequent Events	9 Months Ended
	Sep. 30, 2013
Notes	'
Subsequent Events	'
	(8)          Subsequent Events.  UTMD has evaluated subsequent events through the date the financial statements were issued, and concluded there were no other events or transactions during this period that required recognition or disclosure in its financial statements.

Inventories_Schedule_of_Invent

Inventories: Schedule of Inventory, Current (Tables)	9 Months Ended
	Sep. 30, 2013
Tables/Schedules	'
Schedule of Inventory, Current	'
			30-Sep-13		31-Dec-12
	Finished goods	$	1,474	$	1,630
	Work-in-process		932		938
	Raw materials		2,254		1,785
	Total	$	4,660	$	4,353

Investments_Availableforsale_S

Investments: Available-for-sale Securities (Tables)	9 Months Ended
	Sep. 30, 2013
Tables/Schedules	'
Available-for-sale Securities	'
			3Q 2013		3Q 2012
	Balance, beginning of period	$	5	$	(188)
	Realized loss from securities included in beginning balance		~		~
	Gross unrealized holding gains (losses), in equity securities		1		8
	Deferred income taxes on unrealized holding (gain) loss		~		-3
	Balance, end of period	$	6	$	(183)

Fair_Value_Measurements_Schedu

Fair Value Measurements: Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Tables)	9 Months Ended
	Sep. 30, 2013
Tables/Schedules	'
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis	'
				Fair Value Measurements Using
	Description		Total Fair Value		Quoted Prices		Significant Other		Significant
			at 9/30/2013		in Active Markets		Observable Inputs		Unobservable Inputs
					for Identical Assets		(Level 2)		(Level 3 )
					(Level 1)
	Common stock	$	52	$	52	$	0	$	0

Inventories_Schedule_of_Invent1

Inventories: Schedule of Inventory, Current (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
In Thousands, unless otherwise specified
Details	'	'
Finished goods	$1,474	$1,630
Work-in-process	932	938
Raw materials	2,254	1,785
Total	$4,660	$4,353

StockBased_Compensation_Detail

Stock-Based Compensation (Details) (USD $)	3 Months Ended		9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012
Details	'	'	'	'
Allocated Share-based Compensation Expense	$7	$16	$21	$54

Notes_Payable_Details

Notes Payable (Details) (USD $)	9 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013
JP Morgan Chase Bank NA (Chase) Note	'
Debt Instrument, Description	'In March, 2011, UTMD obtained a $14,000 loan from JPMorgan Chase Bank, N.A. (Chase), to help finance the purchase price of Femcare. The terms and conditions of the loan require UTMD to a) repay the loan in equal monthly payments over 5 years, b) pay interest based on the 30-day LIBOR rate plus a margin starting at 2.80% and ranging from 2.00% to 3.75%, depending on the ratio of its funded debt to EBITDA (Leverage Ratio), c) pledge 65% of all foreign subsidiaries’ stock, d) provide first priority liens on all domestic business assets, e) maintain its Interest Coverage Ratio at 1.05 to 1.00 or better, f) maintain its Tangible Net Worth (TNW) above a minimum threshold 20% below UTMD’s TNW at closing on March 18, and g) maintain its Leverage Ratio at 2.75 to 1.00 or less. UTMD is in compliance with all of the loan financial covenants at September 30, 2013. Based on UTMD’s financial position, the bank’s margin was 2.00% at September 30, 2013. The principal balance on this note at September 30, 2013 was $3,500.
Debt Instrument, Face Amount	$14,000
Debt Instrument, Description of Variable Rate Basis	'30-day LIBOR rate plus a margin starting at 2.80% and ranging from 2.00% to 3.75%
Debt Instrument, Basis Spread on Variable Rate	2.00%
Long-term Debt, Gross	3,500
JP Morgan Chase London Branch Note	'
Debt Instrument, Description	'In March 2011, the Company also obtained a $12,934 loan from JP Morgan Chase, London Branch, to help finance UTMD’s purchase of Femcare. Terms and conditions of the loan are the same as those listed above for the $14,000 U.S. loan. The principal balance on this note at September 30, 2013 was $6,472.
Debt Instrument, Face Amount	12,934
Long-term Debt, Gross	$6,472

Investments_Availableforsale_S1

Investments: Available-for-sale Securities (Details) (USD $)	3 Months Ended
In Thousands, unless otherwise specified	Sep. 30, 2013	Sep. 30, 2012
Details	'	'
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses	$5	($188)
Realized loss from securities included in beginning balance	'	'
Available-for-sale Securities, Gross Unrealized Gain (Loss)	1	8
Deferred income taxes on unrealized holding (gain) loss	'	-3
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses	$6	($183)

Fair_Value_Measurements_Schedu1

Fair Value Measurements: Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Details) (USD $)	Sep. 30, 2013
In Thousands, unless otherwise specified
Fair Value, Inputs, Level 1	'
Common Stock	$52
Fair Value, Inputs, Level 2	'
Common Stock	0
Fair Value, Inputs, Level 3	'
Common Stock	0
Fair Value, Measurements, Recurring	'
Common Stock	$52