EXHIBIT 99.1
FOR MORE INFORMATION, CONTACT:
Investors: Todd Wyatt Office: 210-255-6157 Wireless: 210-347-3540 todd.wyatt@kci1.com | Media: Kevin Belgrade Office: 210-255-6232 Wireless: 210-216-1236 kevin.belgrade@kci1.com |
KINETIC CONCEPTS REPORTS FIRST QUARTER
2011 FINANCIAL RESULTS
First Quarter Highlights
| - | Worldwide revenue of $501.2 million, up from $485.8 million in the prior-year period, as reported, and up 3% on a constant currency basis |
| - | Worldwide Active Healing Solutions™ (“AHS”) revenue of $340.5 million, up from $333.0 million in the prior-year period, as reported, and up 2% on a constant currency basis |
| - | Worldwide LifeCell™ revenue of $93.0 million, up from $79.0 million in the prior-year period, as reported, and up 17% on a constant currency basis |
| - | Worldwide Therapeutic Support Systems (“TSS”) revenue of $67.6 million, down from $73.8 million in the prior-year period, as reported, and down 9% on a constant currency basis |
| - | Net earnings per diluted share of $0.94, up 27% from the prior-year period, as reported |
San Antonio, Texas, April 26, 2011 – Kinetic Concepts, Inc. (NYSE: KCI) today reported first quarter 2011 total revenue of $501.2 million, an increase of 3% from the first quarter of 2010. Foreign currency exchange movements had no significant impact on total revenue for the first quarter of 2011 as compared to the prior year.
Net earnings for the first quarter of 2011 were $68.4 million, an increase of 30% compared to $52.7 million for the same period one year ago. Net earnings per diluted share for the first quarter of 2011 were $0.94 compared to $0.74, or an increase of 27%, from the same period in the prior year. On a non-GAAP basis, excluding the effects of certain non-cash acquisition-related costs and expenses associated with our first quarter 2011 debt refinancing as detailed in the reconciliation contained herein, net earnings per diluted share were $1.11 for the first quarter of 2011 compared to $0.91 from the same period of the prior year.
“I am pleased with our first quarter performance, which demonstrated strength in biologics and in our core V.A.C.® Therapy franchise, particularly in the important U.S. and Japan regions,” said Catherine Burzik, President and Chief Executive Officer of KCI. “We continue to execute on our strategic vision as we aggressively introduce new products and develop our business in new geographies.”
Revenue Recap – First Quarter 2011
Worldwide revenue from AHS products was $340.5 million for the first quarter of 2011, an increase of 2% compared to $333.0 million for the corresponding period of 2010 resulting primarily from increased rental and sales volumes. Foreign currency exchange movements had no significant impact on worldwide AHS revenue as compared to the first quarter of the prior year.
AHS revenue from the Americas region of $257.9 million for the first quarter of 2011 increased 3% from the prior-year quarter driven by higher unit volumes, resulting from a combination of increased usage of traditional V.A.C. Therapy products and the adoption of new negative pressure-based therapies we have introduced in the U.S. Foreign currency exchange movements had no significant impact on Americas AHS revenue as compared to the prior-year period.
AHS revenue from the EMEA region for the first quarter of 2011 was $68.9 million, a decrease of 9% from $75.6 million for the first quarter of the prior year due primarily to lower average rental pricing and lower disposables volumes. Foreign currency exchange movements had no significant impact on EMEA AHS revenue as compared to the prior-year period.
APAC AHS revenue for the first quarter of 2011 was $13.7 million, up 83% from $7.5 million for the first quarter of the prior year due primarily to higher unit volumes and improved average pricing resulting from our entry into Japan. Foreign currency exchange movements favorably impacted APAC AHS revenue by 13% compared to the prior-year period.
Worldwide LifeCell revenue was $93.0 million for the first quarter of 2011, up 18% compared to $79.0 million for the first quarter of the prior year. EMEA LifeCell sales totaled $2.8 million in the first quarter, up from $1.0 million in the year-ago period, with growth reported in all geographic locations where we have launched our LifeCell products. Foreign currency exchange movements had no significant impact on worldwide LifeCell revenue as compared to the first quarter of the prior year.
Worldwide TSS revenue was $67.6 million for the first quarter of 2011, compared to $73.8 million for the same period one year ago, due primarily to lower rental and sales volumes of wound care surfaces. Americas revenue from TSS was $44.6 million for the first three months of 2011, compared to $48.4 million for the prior-year period. EMEA TSS revenue was $22.9 million for the first quarter of 2011, compared to $24.9 million for the same period in the prior year. Foreign currency exchange rate movements favorably impacted Americas TSS revenue by 1% and had an unfavorable impact of 1% on EMEA TSS revenue, as compared to the prior-year period.
Profit Margins
Gross profit for the first quarter of 2011 was $289.0 million, an increase of approximately 6% from the prior-year period. Gross profit margin was 58% for the first quarter of 2011, an increase of approximately 170 basis points from the same period one year ago. The gross profit margin increase was due primarily to lower royalty expense associated with our previous license agreement with Wake Forest University and higher gross margins associated with our LifeCell business unit and lower rental fleet depreciation, partially offset by the additional investment in our AHS sales force during the second half of 2010.
Selling, general and administrative (“SG&A”) expenses for the period increased $9.0 million, or 7%, over the first quarter of 2010. SG&A increases included selling costs associated with our LifeCell division, higher costs associated with new product launches and geographic expansion and increased amortization from recent technology acquisitions, partially offset by reduced litigation costs.
Research and development expenses for the first quarter of 2011 decreased 15% from the prior-year period to $21.2 million. Total research and development expenses represented 4% of revenue for the current-year period compared to 5% one year ago. Research and development expenses were higher during the first quarter of 2010 as we prepared for product launches such as V.A.C.Via™ and Prevena™.
Operating profit for the first quarter of 2011 was $114.6 million, representing an operating margin of 23%, up from 21% in the corresponding period of the prior year. The increase in operating margin resulted from a combination of lower royalty expense, favorable product mix and other operating efficiencies.
Other Income/Expense
First quarter 2011 interest expense decreased to $20.8 million, compared to $23.6 million in the same period of the prior year, due to scheduled and voluntary debt payments made over the last twelve months totaling $154.5 million as well as lower interest rates. Long-term debt outstanding as of March 31, 2011 consisted of a senior secured term loan of $543.1 million due 2016 and $690.0 million of 3.25% senior convertible notes due 2015.
As previously disclosed, we completed the refinancing of our senior credit facility during the first quarter of 2011. Related to the refinancing, we wrote-off $3.2 million in capitalized debt issuance costs, which is included within interest expense in the accompanying condensed consolidated statement of earnings.
Foreign currency transaction gains were $181,000 in the first quarter of 2011 compared to losses of $2.6 million in the prior-year period due primarily to continued volatility in currency exchange rates.
Income Tax Rate
The effective income tax rate for the first quarter of 2011 was 27.3%, compared to 30.0% for the same period in 2010. The lower effective income tax rate in the first quarter of 2011 was due primarily to a higher percentage of taxable income being generated in lower-tax foreign jurisdictions.
Financial Position
Total cash at quarter-end was $442.2 million, an increase of $125.6 million from year-end 2010. Operating cash flow less net capital expenditures for the first quarter of 2011 was $123.2 million compared to $64.4 million in the prior-year period due primarily to higher net earnings and lower cash outlays resulting from our actions related to the Wake Forest patent claims. Total long-term debt outstanding at March 31, 2011 was $1.126 billion on a GAAP-basis and $1.233 billion on an economic, or debt-instrument, basis.
Outlook
We are reaffirming revenue guidance and increasing both GAAP and non-GAAP diluted earnings per share guidance which is based on current information and expectations as of April 26, 2011 (in millions, except per share data):
| % Change | |||||
| FY 2010 | FY 2011 | from 2010 | |||
| Total revenue | $ 2,018 | $ 2,050 – $ 2,090 | 2% – 4% | ||
| Diluted EPS – GAAP basis | $ 3.57 | $ 4.35 – $ 4.45 | 22% – 25% | ||
| Acquisition-related adjustments: | |||||
| Amortization-related adjustments | 0.43 | 0.35 | |||
| Non-cash interest – accounting | |||||
| for convertible debt | 0.18 | 0.19 | |||
| Restructuring and other charges | 0.11 | 0.07 – 0.09 | |||
| Adjusted Diluted EPS – non-GAAP basis | $ 4.29 | $ 4.96 – $ 5.08 | 16% – 18% | ||
| Diluted weighted average shares outstanding | 71.7 | 73.5 – 74.5 | 3% – 4% |
The revenue guidance reflects our expectation of (i) flat-to-low single digit growth in AHS, (ii) mid-to-upper teens growth in LifeCell revenue, (iii) low-to-mid single digit contraction in TSS revenue and (iv) foreign currency exchange rates remaining comparable to 2010.
As announced on February 28, 2011, KCI filed a lawsuit in the Federal District Court in the Western District of Texas seeking a declaratory judgment that KCI no longer owes royalties to Wake Forest University since the relevant patents are invalid or not infringed. Additionally, during the pendency of this case, KCI does not plan to accrue or pay royalties under the licensing agreement starting February 28, 2011. We have also reflected the dilutive effect of our convertible debt as our stock price currently exceeds the initial conversion price of $51.34. In addition, we have included the $0.03 net earnings per diluted share impact of our first quarter debt refinancing within restructuring and other charges above.
Non-GAAP Financial Information
Within this document, we have included our results for the first quarter ended March 31, 2011 and 2010 along with our full year 2011 outlook on a non-GAAP basis to exclude the impact of specified non-cash expenses associated with our acquisition of LifeCell in the second quarter of 2008 and the impact of other charges, including debt refinancing costs incurred during the first quarter of 2011. In addition, we have presented supplemental revenue data on a non-GAAP basis to exclude the impact of foreign currency fluctuations between 2010 and 2011. These non-GAAP financial measures do not replace the presentation of our GAAP results and outlook. We have provided this supplemental non-GAAP information because it may provide meaningful information regarding our results and outlook on a basis that better facilitates an understanding of our expected results of operations which may not be otherwise apparent under GAAP. Management uses this non-GAAP financial information, along with GAAP information, for reviewing the operating results of its business segments and for analyzing potential future business trends. In addition, we believe some investors may use this information in a similar fashion. A reconciliation of our GAAP selected financial information for the periods presented to the non-GAAP selected financial information provided is included herein.
Earnings Release Conference Call
As previously announced, we have scheduled an earnings release conference call for 8:30 a.m. Eastern Daylight Time today, Tuesday, April 26, 2011. The dial-in numbers for this conference call are as follows:
| Domestic Dial-in Number: | 877-537-8066 | |
| International Dial-in Number: | +706-758-3983 | |
| Conference ID Number: | 59545451 |
This call is being webcast and can be accessed at the Kinetic Concepts, Inc. web site at http://www.kci1.com/investor/index.asp, by clicking on Web cast – Q1 2011 Kinetic Concepts, Inc. Earnings Conference Call. An archive of the web cast will be available until April 25, 2012 at http://www.kci1.com/investor/index.asp.
KCI's business outlook as of today is expected to be available on KCI's Investor Relations web site. KCI does not currently expect to update this business outlook until the release of KCI's next quarterly earnings announcement, notwithstanding subsequent developments. Although KCI undertakes no duty to update its business outlook, KCI may update the full business outlook or any portion thereof at any time.
About KCI
Kinetic Concepts, Inc. (NYSE:KCI), is a leading global medical technology company devoted to the discovery, development, manufacture and marketing of innovative, high-technology therapies and products for the wound care, tissue regeneration and therapeutic support system markets. Headquartered in San Antonio, Texas, KCI's success spans more than three decades and can be traced to a history deeply rooted in innovation and a passion for significantly improving the healing and the lives of patients around the world.
The Company employs approximately 7,000 people and markets its products in more than 20 countries. For more information about KCI and how its products are changing the practice of medicine, visit www.KCI1.com.
Forward-Looking Statements
This press release contains forward-looking statements including, among other things, management's outlook, estimates of future performance, revenue, earnings per share, growth objectives and weighted average shares outstanding. The forward-looking statements contained herein are based on our current expectations and are subject to a number of risks and uncertainties that could cause us to fail to achieve our current financial projections and other expectations, such as changes in the demand for V.A.C. Therapy resulting from increased competition, the seasonal slowing of V.A.C. Therapy unit growth in the fourth and first quarter of each year, changes in payer reimbursement policies or in our ability to protect our intellectual property rights. All information set forth in this release and its attachments is as of April 26, 2011. We undertake no duty to update this information. More information about potential factors that could cause our results to differ or adversely affect our business and financial results is included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2010 including, among other sections, under the captions, "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations." This report is on file with the SEC and available at the SEC's website at www.sec.gov. Additional information may also be set forth in those sections in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2011, which is expected to be filed with the SEC in early May 2011.
| KINETIC CONCEPTS, INC. AND SUBSIDIARIES | ||||||||||||
| Condensed Consolidated Statements of Earnings | ||||||||||||
| (in thousands, except per share data) | ||||||||||||
| (unaudited) | ||||||||||||
| Three months ended March 31, | ||||||||||||
| % | ||||||||||||
| 2011 | 2010 | Change | ||||||||||
| Revenue: | ||||||||||||
| Rental | $ | 278,700 | $ | 279,991 | (0.5 | ) % | ||||||
| Sales | 222,484 | 205,814 | 8.1 | |||||||||
| Total revenue | 501,184 | 485,805 | 3.2 | % | ||||||||
| Rental expenses | 150,492 | 153,219 | (1.8 | ) | ||||||||
| Cost of sales | 61,719 | 60,924 | 1.3 | |||||||||
| Gross profit | 288,973 | 271,662 | 6.4 | % | ||||||||
| Selling, general and administrative expenses | 144,367 | 135,379 | 6.6 | |||||||||
| Research and development expenses | 21,183 | 24,784 | (14.5 | ) | ||||||||
| Acquired intangible asset amortization | 8,856 | 10,159 | (12.8 | ) | ||||||||
| Operating earnings | 114,567 | 101,340 | 13.1 | % | ||||||||
| Interest income and other | 202 | 136 | 48.5 | |||||||||
| Interest expense | (20,840 | ) | (23,562 | ) | (11.6 | ) | ||||||
| Foreign currency gain (loss) | 181 | (2,610 | ) | - | ||||||||
| Earnings before income taxes | 94,110 | 75,304 | 25.0 | % | ||||||||
| Income taxes | 25,692 | 22,591 | 13.7 | |||||||||
| Net earnings | $ | 68,418 | $ | 52,713 | 29.8 | % | ||||||
| Net earnings per share: | ||||||||||||
| Basic | $ | 0.96 | $ | 0.75 | 28.0 | % | ||||||
| Diluted | $ | 0.94 | $ | 0.74 | 27.0 | % | ||||||
| Weighted average shares outstanding: | ||||||||||||
| Basic | 71,364 | 70,518 | ||||||||||
| Diluted | 72,587 | 71,496 | ||||||||||
| KINETIC CONCEPTS, INC. AND SUBSIDIARIES | ||||||||
| Condensed Consolidated Balance Sheets | ||||||||
| (in thousands) | ||||||||
| March 31, | December 31, | |||||||
| 2011 | 2010 | |||||||
| (unaudited) | ||||||||
| Assets: | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 442,181 | $ | 316,603 | ||||
| Accounts receivable, net | 401,849 | 414,083 | ||||||
| Inventories, net | 167,855 | 172,552 | ||||||
| Deferred income taxes | 29,466 | 30,112 | ||||||
| Prepaid expenses and other | 36,175 | 34,199 | ||||||
| Total current assets | 1,077,526 | 967,549 | ||||||
| Net property, plant and equipment | 287,439 | 271,063 | ||||||
| Debt issuance costs, net | 32,424 | 22,622 | ||||||
| Deferred income taxes | 19,654 | 17,151 | ||||||
| Goodwill | 1,328,881 | 1,328,881 | ||||||
| Identifiable intangible assets, net | 455,104 | 453,802 | ||||||
| Other non-current assets | 15,187 | 14,931 | ||||||
| $ | 3,216,215 | $ | 3,075,999 | |||||
| Liabilities and Shareholders' Equity: | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 48,820 | $ | 60,137 | ||||
| Accrued expenses and other | 240,119 | 225,524 | ||||||
| Current installments of long-term debt | 27,500 | 169,500 | ||||||
| Income taxes payable | 28,614 | - | ||||||
| Total current liabilities | 345,053 | 455,161 | ||||||
| Long-term debt, net of current installments and discount | 1,098,667 | 935,290 | ||||||
| Non-current tax liabilities | 35,588 | 35,588 | ||||||
| Deferred income taxes | 152,994 | 163,386 | ||||||
| Other non-current liabilities | 3,082 | 3,495 | ||||||
| Total liabilities | 1,635,384 | 1,592,920 | ||||||
| Shareholders' equity: | ||||||||
| Common stock; authorized 225,000 at 2011 and 2010, | ||||||||
| issued and outstanding 72,369 at 2011 and 71,996 at 2010 | 72 | 72 | ||||||
| Preferred stock; authorized 50,000 at 2011 and 2010; | ||||||||
| issued and outstanding 0 at 2011 and 2010 | - | - | ||||||
| Additional paid-in capital | 873,320 | 852,152 | ||||||
| Retained earnings | 681,852 | 613,434 | ||||||
| Accumulated other comprehensive income, net | 25,587 | 17,421 | ||||||
| Shareholders' equity | 1,580,831 | 1,483,079 | ||||||
| $ | 3,216,215 | $ | 3,075,999 | |||||
| KINETIC CONCEPTS, INC. AND SUBSIDIARIES | ||||||||
| Condensed Consolidated Statements of Cash Flows | ||||||||
| (in thousands) | ||||||||
| (unaudited) | ||||||||
| Three months ended March 31, | ||||||||
| 2011 | 2010 | |||||||
| Cash flows from operating activities: | ||||||||
| Net earnings | $ | 68,418 | $ | 52,713 | ||||
| Adjustments to reconcile net earnings to net cash provided | ||||||||
| by operating activities: | ||||||||
| Amortization of convertible debt discount | 5,585 | 5,171 | ||||||
| Depreciation and other amortization | 35,965 | 40,734 | ||||||
| Provision for bad debt | 2,574 | 1,782 | ||||||
| Write-off of deferred debt issuance costs | 3,218 | 1,280 | ||||||
| Share-based compensation expense | 7,645 | 9,478 | ||||||
| Deferred income tax benefit | (10,034 | ) | (12,150 | ) | ||||
| Excess tax benefit from share-based payment arrangements | (355 | ) | (808 | ) | ||||
| Change in assets and liabilities: | ||||||||
| Decrease in accounts receivable, net | 15,442 | 29,442 | ||||||
| Decrease (increase) in inventories, net | 5,337 | (21,924 | ) | |||||
| Decrease (increase) in prepaid expenses and other | (1,977 | ) | 998 | |||||
| Increase (decrease) in accounts payable | (11,023 | ) | 213 | |||||
| Increase (decrease) in accrued expenses and other | 18,891 | (32,290 | ) | |||||
| Increase in tax liabilities, net | 28,390 | 12,628 | ||||||
| Decrease in deferred income taxes, net | (3,897 | ) | (1,995 | ) | ||||
| Net cash provided by operating activities | 164,179 | 85,272 | ||||||
| Cash flows from investing activities: | ||||||||
| Additions to property, plant and equipment | (36,459 | ) | (26,344 | ) | ||||
| Decrease (increase) in inventory to be converted into equipment | ||||||||
| for short-term rental | (4,528 | ) | 5,497 | |||||
| Dispositions of property, plant and equipment | 357 | 743 | ||||||
| Increase in identifiable intangible assets and other non-current assets | (14,922 | ) | (957 | ) | ||||
| Net cash used by investing activities | (55,552 | ) | (21,061 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Repayments of long-term debt, revolving credit facility and | ||||||||
| capital lease obligations | (6,905 | ) | (75,051 | ) | ||||
| Proceeds from exercise of stock options | 14,862 | 4,943 | ||||||
| Excess tax benefit from share-based payment arrangements | 355 | 808 | ||||||
| Purchase of immature shares for minimum tax withholdings | (1,125 | ) | (26 | ) | ||||
| Refinancing of senior credit facility: | ||||||||
| Proceeds from borrowings on refinancing of senior credit facility | 146,012 | - | ||||||
| Repayments on senior credit facility – due 2013 | (123,346 | ) | - | |||||
| Payment of debt issuance costs | (14,676 | ) | - | |||||
| Net cash provided (used) by financing activities | 15,177 | (69,326 | ) | |||||
| Effect of exchange rate changes on cash and cash equivalents | 1,774 | (1,980 | ) | |||||
| Net increase (decrease) in cash and cash equivalents | 125,578 | (7,095 | ) | |||||
| Cash and cash equivalents, beginning of period | 316,603 | 263,157 | ||||||
| Cash and cash equivalents, end of period | $ | 442,181 | $ | 256,062 | ||||
| KINETIC CONCEPTS, INC. AND SUBSIDIARIES | ||||||||||||||||||||
| Reconciliation from GAAP to Non-GAAP | ||||||||||||||||||||
| Supplemental Revenue Data | ||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||
| Three months ended March 31, | ||||||||||||||||||||
| 2011 | GAAP | Constant | ||||||||||||||||||
| Constant | 2010 | % | Currency % | |||||||||||||||||
| GAAP | FX Impact | Currency | GAAP | Change | Change (1) | |||||||||||||||
| Total Revenue: | ||||||||||||||||||||
AHS | $ | 340,539 | $ | (1,433 | ) | $ | 339,106 | $ | 332,953 | 2.3 | % | 1.8 | % | |||||||
| LifeCell | 93,014 | (207 | ) | 92,807 | 79,015 | 17.7 | 17.5 | |||||||||||||
| TSS | 67,631 | (175 | ) | 67,456 | 73,837 | (8.4 | ) | (8.6 | ) | |||||||||||
| Total Revenue | $ | 501,184 | $ | (1,815 | ) | $ | 499,369 | $ | 485,805 | 3.2 | % | 2.8 | % | |||||||
| AHS: | ||||||||||||||||||||
| Americas revenue | ||||||||||||||||||||
| Rental | $ | 181,862 | $ | (274 | ) | $ | 181,588 | $ | 178,993 | 1.6 | % | 1.4 | % | |||||||
| Sales | 75,998 | (272 | ) | 75,726 | 70,839 | 7.3 | 6.9 | |||||||||||||
| Total Americas revenue | 257,860 | (546 | ) | 257,314 | 249,832 | 3.2 | 3.0 | |||||||||||||
| EMEA revenue | ||||||||||||||||||||
| Rental | 30,449 | 300 | 30,749 | 35,585 | (14.4 | ) | (13.6 | ) | ||||||||||||
| Sales | 38,491 | (176 | ) | 38,315 | 40,020 | (3.8 | ) | (4.3 | ) | |||||||||||
| Total EMEA revenue | 68,940 | 124 | 69,064 | 75,605 | (8.8 | ) | (8.7 | ) | ||||||||||||
| APAC revenue | ||||||||||||||||||||
| Rental | 7,960 | (567 | ) | 7,393 | 3,779 | 110.6 | 95.6 | |||||||||||||
| Sales | 5,779 | (444 | ) | 5,335 | 3,737 | 54.6 | 42.8 | |||||||||||||
| Total APAC revenue | 13,739 | (1,011 | ) | 12,728 | 7,516 | 82.8 | 69.3 | |||||||||||||
| Total rental revenue | 220,271 | (541 | ) | 219,730 | 218,357 | 0.9 | 0.6 | |||||||||||||
| Total sales revenue | 120,268 | (892 | ) | 119,376 | 114,596 | 4.9 | 4.2 | |||||||||||||
| Total AHS Revenue | $ | 340,539 | $ | (1,433 | ) | $ | 339,106 | $ | 332,953 | 2.3 | % | 1.8 | % | |||||||
| LifeCell Revenue: | ||||||||||||||||||||
| Americas revenue | ||||||||||||||||||||
| Rental | $ | 235 | $ | - | $ | 235 | $ | - | - | % | - | % | ||||||||
| Sales | 90,002 | (21 | ) | 89,981 | 77,974 | 15.4 | 15.4 | |||||||||||||
| Total Americas revenue | 90,237 | (21 | ) | 90,216 | 77,974 | 15.7 | 15.7 | |||||||||||||
| EMEA revenue | ||||||||||||||||||||
| Sales | 2,777 | (186 | ) | 2,591 | 1,041 | 166.8 | 148.9 | |||||||||||||
| Total rental revenue | 235 | - | 235 | - | - | - | ||||||||||||||
| Total sales revenue | 92,779 | (207 | ) | 92,572 | 79,015 | 17.4 | 17.2 | |||||||||||||
| Total LifeCell Revenue | $ | 93,014 | $ | (207 | ) | $ | 92,807 | $ | 79,015 | 17.7 | % | 17.5 | % | |||||||
| TSS Revenue: | ||||||||||||||||||||
| Americas revenue | ||||||||||||||||||||
| Rental | $ | 38,523 | $ | (296 | ) | $ | 38,227 | $ | 41,410 | (7.0 | ) % | (7.7 | ) % | |||||||
| Sales | 6,030 | (106 | ) | 5,924 | 6,990 | (13.7 | ) | (15.3 | ) | |||||||||||
| Total Americas revenue | 44,553 | (402 | ) | 44,151 | 48,400 | (7.9 | ) | (8.8 | ) | |||||||||||
| EMEA revenue | ||||||||||||||||||||
| Rental | 19,667 | 162 | 19,829 | 20,180 | (2.5 | ) | (1.7 | ) | ||||||||||||
| Sales | 3,203 | 105 | 3,308 | 4,709 | (32.0 | ) | (29.8 | ) | ||||||||||||
| Total EMEA revenue | 22,870 | 267 | 23,137 | 24,889 | (8.1 | ) | (7.0 | ) | ||||||||||||
| APAC revenue | ||||||||||||||||||||
| Rental | 4 | (5 | ) | (1 | ) | 44 | (90.9 | ) | (102.3 | ) | ||||||||||
| Sales | 204 | (35 | ) | 169 | 504 | (59.5 | ) | (66.5 | ) | |||||||||||
| Total APAC revenue | 208 | (40 | ) | 168 | 548 | (62.0 | ) | (69.3 | ) | |||||||||||
| Total rental revenue | 58,194 | (139 | ) | 58,055 | 61,634 | (5.6 | ) | (5.8 | ) | |||||||||||
| Total sales revenue | 9,437 | (36 | ) | 9,401 | 12,203 | (22.7 | ) | (23.0 | ) | |||||||||||
| Total TSS Revenue | $ | 67,631 | $ | (175 | ) | $ | 67,456 | $ | 73,837 | (8.4 | ) % | (8.6 | ) % | |||||||
(1) Represents percentage change between 2011 Non-GAAP Constant Currency revenue and 2010 GAAP revenue. | ||||||||||||||||||||
| KINETIC CONCEPTS, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||
| Selected Financial Information - GAAP to Non-GAAP Reconciliation | ||||||||||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||
| Three months ended March 31, | ||||||||||||||||||||||||
| Interest | ||||||||||||||||||||||||
| Expense - | ||||||||||||||||||||||||
| Debt | Adoption of | |||||||||||||||||||||||
| Amortization | Issuance | Required | Restructuring | |||||||||||||||||||||
| 2011 | of Acquired | Cost | Accounting | and Other | Adjusted | Adjusted | % | |||||||||||||||||
| GAAP | Intangibles | Amortization | Standards | Charges | 2011 | 2010 | Change | |||||||||||||||||
| Operating earnings | $ | 114,567 | $ | 8,856 | $ | - | $ | - | $ | - | $ | 123,423 | $ | 111,499 | 10.7 | % | ||||||||
Net earnings (1) | $ | 68,418 | $ | 5,446 | $ | 1,019 | $ | 3,435 | $ | 1,979 | $ | 80,297 | $ | 64,592 | 24.3 | % | ||||||||
| Diluted earnings per share | $ | 0.94 | $ | 0.08 | $ | 0.01 | $ | 0.05 | $ | 0.03 | $ | 1.11 | $ | 0.91 | 22.0 | % | ||||||||
| Three months ended March 31, | |||||||||||||||
| Interest | |||||||||||||||
| Expense - | |||||||||||||||
| Debt | Adoption of | ||||||||||||||
| Amortization | Issuance | Required | |||||||||||||
| 2010 | of Acquired | Cost | Accounting | Adjusted | |||||||||||
| GAAP | Intangibles | Amortization | Standards | 2010 | |||||||||||
| Operating earnings | $ | 101,340 | $ | 10,159 | $ | - | $ | - | $ | 111,499 | |||||
Net earnings (1) | $ | 52,713 | $ | 6,247 | $ | 2,452 | $ | 3,180 | $ | 64,592 | |||||
| Diluted earnings per share | $ | 0.74 | $ | 0.09 | $ | 0.03 | $ | 0.05 | $ | 0.91 | |||||
| (1) Adjustments to “Net earnings” are presented net of tax. The tax effect of each reconciling item is calculated using the Company’s estimated incremental U.S. combined federal and state tax rate of 38.5%. | |||||||||||||||