Exhibit 99.1
{CHOLESTECH LOGO]
CHOLESTECH ANNOUNCES FINANCIAL RESULTS FOR FISCAL 2003
HAYWARD, Calif. - April 23, 2003 -- Cholestech Corporation (Nasdaq: CTEC) today
announced:
- Record revenue of $48.5 million in fiscal 2003, up 16% over
prior year, fueled in part by record fiscal fourth quarter
revenue of $13.5 million, which represented a 21% increase
over revenue of $11.1 million in the prior year quarter.
- Physician office laboratory market revenue in fiscal 2003
increased 35% over fiscal 2002 and 27% over prior year
quarter.
- Net income from continuing operations, excluding a
restructuring charge associated with the divestiture of the
WellCheck testing services business and an income tax benefit,
was $0.50 per share in fiscal 2003, including fourth quarter
net income from continuing operations, excluding an income tax
benefit, of $0.15 per share.
- Reported fiscal 2003 net income of $0.35 per share included a
$0.30 per share income tax benefit, a $0.41 per share net loss
from discontinued operations and a restructuring charge of
$0.04 per share, compared to fiscal 2002 net income of $0.40
per share, which included a $0.10 per share loss from
discontinued operations.
RECONCILIATION OF EARNINGS
($ per share, diluted)
FOURTH QUARTER FISCAL YEAR
-------------- -----------
FISCAL 2003 FISCAL 2002 FISCAL 2003 FISCAL 2002
----------- ----------- ----------- -----------
Net income from continuing operations, excluding
restructuring charge and income tax benefit $ 0.15 $ 0.15 $ 0.50 $ 0.50
Income tax benefit 0.30 -- 0.30 --
Net loss from discontinued operations (0.01) (0.04) (0.41) (0.10)
Restructuring charge -- -- (0.04) --
------ ------ ------ ------
Reported $ 0.44 $ 0.11 $ 0.35 $ 0.40
====== ====== ====== ======
Cholestech achieved revenue of $48.5 million for the fiscal year ended March 28,
2003, an increase of 16% over fiscal 2002 revenue of $41.7 million. Fourth
quarter revenue of $13.5 million represented a 21% increase over revenue of
$11.1 million in the prior year quarter.
Warren E. Pinckert II, president and chief executive officer, said "In fiscal
2003, we grew our installed base of Cholestech LDX(R) and Cholestech GDX(TM)
Systems and increased our penetration of the domestic physician office
laboratory market, which represented 51% of our revenue in fiscal 2003, up from
44% in fiscal 2002. Revenue in this market increased 35% over the prior fiscal
year."
In fiscal 2003, net income from continuing operations, excluding a restructuring
charge and an income tax benefit, was $0.50 per share, an amount equal to net
income per share from continuing operations in fiscal 2002. The company reported
net income of $4.9 million or $0.35 per share in fiscal 2003 compared to net
income of $5.6 million or $0.40 per share in fiscal 2002. Net income in fiscal
2003 included a $4.2 million or $0.30 per share gain from an income tax benefit,
a $5.8 million loss or $0.41 per share from discontinued operations and a
restructuring charge of $591,000 or $0.04 per share associated with the
divestiture of the WellCheck testing services
business. The net deferred income tax benefit of $4.2 million results from the
reversal of a portion of the valuation allowance previously established for the
company's net operating losses. Based on the company's recent positive operating
results, in the fourth quarter of fiscal 2003 the company determined that it was
increasingly likely that it would be able to realize a portion of its net
operating loss carryforwards in future periods thereby reducing taxes to be paid
in those periods.
In the fourth quarter of fiscal 2003, Cholestech achieved net income from
continuing operations, excluding an income tax benefit, of $0.15 per share, an
amount equal to net income per share from continuing operations in the prior
year period. In the fourth quarter of fiscal 2003, Cholestech reported net
income of $6.0 million or $0.44 per share compared to net income of $1.5 million
or $0.11 per share in fiscal 2002. Net income in the fourth quarter of fiscal
2003 included a $4.2 million or $0.30 share income tax benefit.
Pinckert added, "The sale of our WellCheck testing services business and the
launch of our GDX System under a multi-year global distribution agreement in
fiscal 2003 enabled us to successfully introduce a new product to, and focus
additional resources on, our core diagnostic products business, with a
particular emphasis on the physician office laboratory market. In fiscal 2004,
we plan to continue to invest a portion of our savings from the WellCheck
divestiture into business development, research and development and other
initiatives designed to create revenue growth opportunities and leverage our
worldwide product distribution capabilities, although we expect operating
expenses to grow more slowly than revenue."
The company believes the NIH guidelines, which aggressively target heart
disease, the #1 killer of Americans, have significantly expanded its market
opportunity by defining the domestic adult population of people to be screened
for high cholesterol as the 201 million Americans who are 20 years of age or
older. In addition, the NIH guidelines almost triple the number of Americans who
should be under a doctor's care and prescribed a cholesterol lowering drug -
from about 13 to 36 million and specify the lipid profile as the preferred
initial screening and ongoing monitoring test for an individual. The Cholestech
LDX(R) System is waived under the Clinical Laboratory Improvement Amendments
("CLIA") by the Food and Drug Administration ("FDA") and can provide a complete
lipid profile in accordance with the NIH guidelines in less than five minutes
using a single drop of blood. In addition, the company's ALT test, which enables
physicians to monitor the potential side effects on the liver from cholesterol
lowering drugs and other medications, is the only ALT test waived under CLIA by
the FDA.
The Cholestech GDX System(TM), which the company began distributing in July 2002
under a multi-year global distribution agreement, expands the company's
technology platform by offering a physician's office or diabetes clinic
efficient and economic diagnostic testing for A1C, which measures the long term
progress of a patient's diabetes and therapy management. According to the
American Diabetes Association ("ADA"), cardiovascular disease is the leading
cause of mortality in people with diabetes, and type 2 diabetes is associated
with a two to fourfold excess risk of coronary heart disease. In conjunction
with the Cholestech LDX System, the GDX System allows Cholestech to offer its
customers a full complement of products for immediate risk assessment and
therapeutic monitoring of heart disease and diabetes.
INVESTOR CONFERENCE CALL
The company will conduct a conference call on fiscal 2003 year-end and fourth
quarter results beginning at 7 a.m. PDT today. The call will be available to all
investors by dialing (800) 245-3043 or, from international locations, (785)
832-0201. A replay of the call will be aired from approximately 9 a.m. today
until 9 p.m. PDT on May 9 by dialing (877) 710-5302 or from international
locations, (402) 220-1605. There is no pass code.
ABOUT CHOLESTECH
Cholestech is committed to enabling people to lead longer, healthier and more
active lives. Cholestech provides easy to use, accessible diagnostic tools and
information to health care practitioners in over 35 countries around the world.
Cholestech offers efficient and economic diagnostic testing for cholesterol and
related lipids, blood glucose and glycemic control, and liver function at the
point of care. Health care providers can use the CLIA-
waived Cholestech LDX(R) and GDX(TM) Systems to initiate and monitor the
progress of patient therapy. By providing effective disease management
solutions, Cholestech's goal is to be a leading provider of diagnostic tools and
information for immediate risk assessment and therapeutic monitoring of heart
disease and diabetes.
Cholestech LDX(R) is a registered trademark and Cholestech GDX(TM) is a
trademark of Cholestech Corporation. All other trademarks mentioned in this
document are the property of their respective owners. For more information about
Cholestech and its products visit us on the web at www.cholestech.com.
SAFE HARBOR STATEMENT OF CHOLESTECH CORPORATION UNDER THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995:
This release contains forward-looking statements as defined in the Private
Securities Litigation Reform Act of 1995, including statements regarding: the
anticipated realization of a portion of net operating loss carryforwards;
planned investments into initiatives to enhance revenue growth and the expected
growth opportunities and the expansion of the number of Americans being treated
for high cholesterol due to the 2001 NIH guidelines. Actual results may differ
materially from those in the forward-looking statements due to risks and
uncertainties, including: the achievement of continued positive operating
results and revenue growth; competition from other companies with similar
product offerings; demand for our products, particularly in international
markets; internal operating results; regulatory changes and guidelines affecting
the healthcare system in the United States, and other factors.
Cholestech Contact: Investor Contact: Media Contact:
- ------------------- ----------------- --------------
William W. Burke Jim Byers Christopher Katis
Chief Financial Officer FD Morgen-Walke FD Morgen-Walke
Cholestech Corporation 415-439-4506 415-439-4518
510-781-5065 jbyers@fdmw.com ckatis@fdmw.com
bburke@cholestech.com
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts, unaudited)
Thirteen weeks ended Fifty-two weeks ended
-------------------- ---------------------
3/28/2003 3/29/2002 3/28/2003 3/29/2002
--------- --------- --------- ---------
Revenue $ 13,480 $ 11,144 $ 48,541 $ 41,747
Cost of revenue 5,577 4,451 20,424 17,040
-------- -------- -------- --------
Gross profit 7,903 6,693 28,117 24,707
-------- -------- -------- --------
Operating expenses:
Sales & marketing 3,209 2,527 12,325 10,115
Research & development 899 667 2,958 2,564
General & administrative 1,805 1,353 5,900 5,336
Restructuring charge -- -- 591 --
-------- -------- -------- --------
Total operating expenses 5,913 4,547 21,774 18,015
-------- -------- -------- --------
Income from continuing operations 1,990 2,146 6,343 6,692
Net interest and other income (expense) 124 150 438 449
Provision (benefit) for income taxes, net (4,121) 95 (3,934) 289
-------- -------- -------- --------
Net income from continuing operations 6,235 2,201 10,715 6,852
-------- -------- -------- --------
Loss from discontinued operations (27) (668) (1,377) (1,302)
Loss from sale of discontinued operations (163) -- (4,445) --
-------- -------- -------- --------
Net loss from discontinued operations (190) (668) (5,822) (1,302)
-------- -------- -------- --------
Net income $ 6,045 $ 1,533 $ 4,893 $ 5,550
======== ======== ======== ========
Net income from continuing operations per share:
Basic $ 0.46 $ 0.17 $ 0.79 $ 0.54
Diluted $ 0.45 $ 0.15 $ 0.76 $ 0.50
Net loss from discontinued operations per share:
Basic $ (0.02) $ (0.05) $ (0.43) $ (0.10)
Diluted $ (0.01) $ (0.04) $ (0.41) $ (0.10)
Net income per share:
Basic $ 0.44 $ 0.12 $ 0.36 $ 0.44
Diluted $ 0.44 $ 0.11 $ 0.35 $ 0.40
Shares used to compute net income (loss) per share:
Basic 13,637 13,144 13,551 12,658
Diluted 13,802 14,358 14,077 13,730
NOTE: Prior period amounts have been adjusted to reflect the operations of the
WellCheck segment as discontinued operations following its divestiture on
December 23, 2002.