Exhibit 99.1
FOR IMMEDIATE RELEASE Contact: Larry Tannenbaum
Chief Financial Officer
(650) 940-4700
July 22, 2003
Mountain View, California
IRIDEX REPORTS SECOND QUARTER RESULTS
IRIDEX Corporation (NASDAQ/NMS:IRIX) announced that sales for the quarter
ended June 28, 2003 were $7.4 million, at the same level when compared to the
corresponding quarter in 2002. The Company reported a net loss for the second
fiscal quarter of $299,000 or $0.04 per diluted share, compared to a net loss of
$447,000 or $0.07 per diluted share for the corresponding quarter in 2002. The
improvement in earnings in the second quarter of 2003 compared to the
corresponding quarter in 2002 was primarily due to lower operating costs
resulting from the Company's reduction-in-force completed during the second
quarter of 2002.
Sales of ophthalmology products during the second quarter of 2003 were
$6.0 million, an increase of 6% from the equivalent quarter of 2002. Due to weak
market conditions in the aesthetic market, sales of aesthetics products were
$1.4 million, a decrease of 19% from the corresponding quarter in 2002.
Theodore A. Boutacoff, President and CEO commented, "Based on the
continuing difficult economic climate, we are somewhat pleased that earnings per
share improved $0.03 when compared with the same quarter in 2002. Although we
are not satisfied with our current revenue trends, we are encouraged by the
introduction of new products and further validation of clinical applications.
Over the long term and as overall market conditions improve, the Company expects
to increase total revenues by continuing to supplement our existing product
lines with additional new product introductions, thus helping to reach our goal
of returning to profitability."
"During the quarter we began shipping two new previously announced
products, a 50 micron slit lamp adaptor and a 25 gauge single-use EndoProbe(R),"
continued Mr. Boutacoff. "Our 25 gauge EndoProbe allows ophthalmologists to
treat diabetic retinopathy, retinal breaks and detachments using newly
introduced "suture-less" vitrectomy systems. This new 25 gauge probe, along with
our tapered, angled, fluted, and recently introduced BriteLight(TM) EndoProbe
devices are compatible with IRIDEX and other validated laser photocoagulator
systems."
On the clinical application front, earlier this quarter the Company
announced the publication of two additional clinical studies using the Company's
IRIS Medical(R) OcuLight(R) SLx laser that further validate the effectiveness of
transpupillary thermotherapy (TTT) for the treatment of wet age-related macular
degeneration. There are now 15 states with written reimbursement coverage
policies on TTT.
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During the first six months of 2003, the Company generated $1.8 million in
cash provided from operations primarily as a result of accounts receivables
decreasing by $1.6 million. At the end of second quarter 2003, cash, cash
equivalents and available for sale securities equaled $13.1 million, a decrease
of $169,000 from the ending first quarter 2003 balance. The accounts receivable
balance of $6.4 million at the end of second quarter 2003 was approximately
level with the first quarter 2003. In addition, inventory decreased $321,000
during the first half of this year, while second quarter 2003 inventory
decreased by $212,000 from first quarter 2003.
Current market conditions continue to make it difficult to offer accurate
guidance, but the Company now expects total 2003 revenues to be flat compared to
total reported revenues for the 2002 fiscal year. The Company currently believes
that earnings per share will be slightly negative for the year 2003. As
previously mentioned, the Company will continue to place a high priority on its
asset management efforts to further increase its cash position.
IRIDEX management will conduct a conference call today for those
interested at 2:00 p.m. PST/5:00 p.m. EST. The dial-in number is 800-603-0804. A
recording of this call will be available for replay beginning at 5:00 p.m. PST/
8:00 p.m. EST, through July 29, 2003, 9:00 p.m. PST. The number for the replay
is 800-642-1687 and the access code is 1599394. An audio replay of the
conference call, including the information presented, will also be available on
the Company's website at www.iridex.com.
About IRIDEX
IRIDEX Corporation is a leading worldwide provider of semiconductor-based
laser systems for the ophthalmology and aesthetics markets. IRIDEX products are
sold in the United States through a direct sales force and internationally
through 66 independent distributors into 107 countries. For further information,
visit the Company's website at www.iridex.com.
Safe Harbor Statement
This announcement contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended and Section 21E of the
Securities Act of 1934, as amended. The foregoing statements regarding
anticipated revenues for the full fiscal year 2003, earnings per share
projections and expected improvements from continued asset management efforts to
the Company's balance sheet for the fiscal year 2003, are preliminary and
forward looking. Actual results could differ materially from those projected in
the forward-looking statements based on, among other things, the actual order
and shipment rate during the remainder of the year for the Company's products,
including the Company's 50 micron slit lamp adaptor and 25 gauge single-use
EndoProbe, the rate of introduction and market acceptance of the Company's new
products, the impact of any continuing economic downturn on sales, including
sales of the Company's aesthetics products which are typically used for elective
procedures that can be deferred, and the difficulty forecasting anticipated
revenues due to continuing weakness and uncertainties related to general
economic conditions and overall weakness and demand in the Company's markets,
especially the aesthetics market. Other statements in this news release relating
to future events or predictions, such as those regarding the Company's ability
to introduce new products and applications, expected increases in overall
revenues and improved market conditions could differ materially from those
projected in the forward-looking statements. Risks and
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uncertainties to which the Company are subject may include, but may not
necessarily be limited to, the amount of orders that the Company receives and
ships during the quarter and the remainder of the year, inability to further
reduce costs, maintain or increase gross margins, the speed at which the Center
for Medicare and Medicaid Services (CMS) and local carriers are willing to
address reimbursement coverage policies on TTT and their internal policies
regarding the matter, the risks associated with bringing new products to market,
the results of clinical trials, competition in our markets and dependence on
international sales. Please see a detailed description of these risks contained
in our Quarterly Reports on Form 10-Q and Annual Report on Form 10-K for the
year ended December 28, 2002 filed with the Securities and Exchange Commission.
Forward-looking statements contained in this announcement are made as of this
date and will not be updated.
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IRIDEX CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED
--------------------- ----------------------
JUNE 28, JUNE 29, JUNE 28, JUNE 29,
2003 2002 2003 2002
-------- -------- -------- --------
Sales $ 7,435 $ 7,433 $ 14,661 $ 14,396
Cost of sales 4,315 4,312 8,303 8,190
-------- -------- -------- --------
Gross profit 3,120 3,121 6,358 6,206
-------- -------- -------- --------
Operating expenses:
Research and development 1,047 1,320 1,997 2,465
Sales, general and administrative 2,564 2,512 5,028 4,799
-------- -------- -------- --------
Total operating expenses 3,611 3,832 7,025 7,264
-------- -------- -------- --------
Loss from operations (491) (711) (667) (1,058)
Interest and other income, net 51 54 105 97
-------- -------- -------- --------
Loss before benefit from income taxes (440) (657) (562) (961)
Benefit from income taxes 141 210 181 307
-------- -------- -------- --------
Net loss $ (299) $ (447) $ (381) $ (654)
======== ======== ======== ========
Net loss per common share - basic and diluted $ (0.04) $ (0.07) $ (0.06) $ (0.10)
======== ======== ======== ========
Shares used in per common share basic and diluted
calculations 6,919 6,861 6,916 6,849
======== ======== ======== ========
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IRIDEX CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
JUNE 28, DECEMBER 28,
2003 2003
------------ ------------
(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents $ 8,121 $ 9,186
Available-for-sale securities 5,016 2,356
Accounts receivable, net 6,389 8,037
Inventories 10,404 10,725
Prepaids and other current assets 1,105 751
------------ ------------
Total current assets 31,035 31,055
Property and equipment, net 729 950
Deferred income taxes 2,267 2,267
------------ ------------
Total assets $ 34,031 $ 34,272
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 892 $ 657
Accrued expenses 3,305 3,417
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Total liabilities 4,197 4,074
------------ ------------
Stockholders' Equity:
Common stock 70 70
Additional paid-in capital 23,652 23,631
Accumulated other comprehensive income (1) 3
Treasury stock (430) (430)
Retained earnings 6,543 6,924
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Total stockholders' equity 29,834 30,198
------------ ------------
Total liabilities and stockholders' equity $ 34,031 $ 34,272
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