Exhibit 99.1
[logo/logotype]MERIT MEDICAL
1600 West Merit Parkway o South Jordan, UT 84095
Telephone: 801-253-1600 o Fax: 801-253-1688
PRESSRELEASE
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FOR IMMEDIATE RELEASE
Date: February 19, 2004
Contact: Anne-Marie Wright, Director, Corporate Communications
Phone: (801) 208-4167 e-mail: awright@merit.com Fax: (801) 253-1681
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MERIT MEDICAL REPORTS RECORD NET INCOME AND SALES
FOR THE YEAR ENDED DECEMBER 31, 2003
SOUTH JORDAN, UTAH - Merit Medical Systems, Inc. (NASDAQ:NMS:MMSI), a
manufacturer and marketer of proprietary disposable products used in cardiology
and radiology procedures, reported record net income of $17.3 million, or $0.64
per share, for the year ended December 31, 2003, compared with $11.3 million, or
$0.43 per share for the 2002 year, an increase of almost 53%. Net income for
2003 includes a non-recurring gain from the settlement of a legal dispute and
sale of land of approximately $627,000 (net of tax), or $0.02 per share, which
occurred in the first and second quarters of 2003.
Merit's revenues for the year ended December 31, 2003 were a record
$136 million, compared with $116.2 million for the same period in 2002, an
increase of approximately 17%. Revenues for the quarter ended December 31, 2003
were a record $35.1 million, up 19.4% compared with $29.4 million for the fourth
quarter of 2002.
Net income for the quarter ended December 31, 2003 was a record $4.7
million, or $0.17 per share, compared with $3.2 million, or $0.12 per share, in
the fourth quarter of 2002, an increase of 49%.
Sales of every category of Merit's products grew in 2003, compared to
2002. Custom kit sales and stand-alone product sales increased by approximately
19%; inflation device sales grew by 17%; and catheter sales rose by 9%.
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Increases in revenue for the fourth quarter of 2003, compared to the
fourth quarter of 2002, resulted primarily from across-the-board growth in sales
of Merit's medical devices, as follows: custom kit sales rose 27%; catheter
sales increased 20%; inflation device sales grew 17%; and stand-alone sales rose
14%.
"We are pleased to report a record quarter and a record year," said
Fred P. Lampropoulos, Chairman and CEO of Merit. "We continued to generate
higher sales over a relatively fixed expense base with increased efficiencies
and employee productivity gains. Our earnings rose 53%, while our cash balance
at December 31, 2003 rose to $30.2 million, an increase of 212% from $9.7
million at December 31, 2002.
"In 2004, we anticipate that we will benefit from new product
introductions and productivity gains," Lampropoulos added. "We are also planning
to break ground on an 180,000 square foot facility that would increase our
manufacturing space by approximately 50%."
Merit's gross margin improved to 44.7% in 2003, compared to 41.7% in
2002. Gross margin for the fourth quarter of 2003 improved to 46.4%, compared
with 43.4% for the fourth quarter of 2002. This improvement was largely due to
higher production volumes, employee productivity improvements and cost-saving
programs, which were achieved during 2003.
Total operating expenses for 2003 decreased as a percentage of sales to
25.8%, compared to 27.3% in 2002. For the fourth quarter of 2003, total
operating expenses decreased as a percentage of sales to 25.8%, compared to
27.9% for the same period in 2002. Selling, general and administrative expenses
declined as a percentage of sales to 22.4% for the three and twelve months ended
December 31, 2003, compared to 24.1% and 23.9% for the three and twelve months
ended December 31, 2002, respectively.
Research and development expenditures were 3.4% of sales for the three
and twelve months ended December 31, 2003, compared to 3.8% of sales for the
fourth quarter of 2002 and 3.4% of sales for the year 2002.
Income before income tax expense rose by 61% to a record $27.0 million
in 2003, compared to $16.8 million in 2002. For the fourth quarter of 2003,
income before income tax expense rose by 59% to a record $7.4 million, compared
to $4.6 million for the fourth quarter of 2002. The Company's overall effective
tax rate increased to 36.0% in 2003, compared to 32.5% in 2002. For the fourth
quarter of 2003 the Company's effective tax rate was 36.4%, compared to 31.8%
for the comparable period of 2002. The increase in the effective tax rate was
primarily the result of lower taxable income for the three and twelve months
ended December 31, 2003, for the Company's Irish operations, which are taxed at
a lower rate than U.S. operations.
Merit said it currently expects revenues and earnings per share for the
year ending December 31, 2004 to be in the range of $152-155 million, and
$0.70-0.73, respectively.
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INCOME STATEMENT
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3 Mos. Ended 12/31 12 Mos. Ended 12/31
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2003 2002 2003 2002
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(in thousands except share data)
REVENUE $ 35,128 $ 29,425 $ 135,954 $ 116,227
COST OF SALES 18,833 16,651 75,230 67,712
GROSS PROFIT 16,295 12,774 60,724 48,515
OPERATING EXPENSES:
Selling, General and
Administration 7,861 7,078 30,468 27,732
Research and Development 1,205 1,132 4,627 4,008
TOTAL OPERATING
EXPENSES 9,066 8,210 35,095 31,740
OPERATING INCOME 7,229 4,564 25,629 16,775
OTHER EXPENSE-
(INCOME) (142) (63) (1,394) 13
PRETAX INCOME 7,371 4,627 27,023 16,762
INCOME TAX EXPENSE 2,685 1,471 9,728 5,452
NET INCOME 4,686 3,156 17,295 11,310
EARNINGS PER COMMON SHARES:
BASIC $ 0.18 $ 0.13 $ 0.68 $ 0.47
DILUTED $ 0.17 $ 0.12 $ 0.64 $ 0.43
AVERAGE COMMON SHARES:
BASIC 25,844,394 24,582,720 25,401,445 24,226,095
DILUTED 27,615,738 26,585,140 27,033,964 26,238,449
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BALANCE SHEET
12/31/03 12/31/02
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(in thousands)
ASSETS
CASH $ 30,204 $ 9,684
TRADE RECEIVABLES (NET) 17,728 15,247
INVENTORIES 21,269 18,699
OTHER CURRENT ASSETS 2,260 2,538
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TOTAL CURRENT ASSETS 71,461 46,168
PROPERTY & EQUIPMENT (NET) 29,197 25,412
OTHER ASSETS 6,643 6,725
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TOTAL ASSETS $107,301 $ 78,305
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LIABILITIES AND STOCKHOLDERS' EQUITY
TOTAL CURRENT LIABILITIES $ 14,530 $ 11,586
OTHER LIABILITIES 4,527 3,303
LONG-TERM DEBT 0 17
STOCKHOLDERS' EQUITY 88,244 63,399
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TOTAL LIABILITES AND
STOCKHOLDERS' EQUITY $107,301 $ 78,305
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CONFERENCE CALL
Merit Medical Systems, Inc. invites all interested parties to join its
officers in their quarterly and year-end earnings conference call and 2004
guidance to be held today, February 19, 2004, at 5:00 p.m. Eastern Time (4:00
p.m. Central, 3:00 p.m. Mountain, and 2:00 p.m. Pacific). During the conference
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call, the results of operations for the year and quarter ended December 31,
2003, will be discussed in more detail, along with the Company's expectations
for 2004 and trends that may affect its future results.
The telephone numbers are: Domestic: (800) 218-0204, and International:
(303) 205-0033. A rebroadcast will be available through February 19, 2005, on
the Internet by accessing the CCBN logo under "Webcasts" at www.merit.com or at
www.ccbn.com.
ABOUT MERIT
Founded in 1987, Merit Medical Systems, Inc. is a publicly traded
company engaged in the development, manufacture and distribution of proprietary
disposable
medical products used in interventional and diagnostic procedures, particularly
in cardiology and radiology. Merit serves client hospitals worldwide with a
domestic and international sales force totaling approximately 70 individuals.
Merit employs approximately 1,240 people worldwide, with manufacturing
facilities in South Jordan and Salt Lake City, Utah; Santa Clara, California;
Angleton, Texas; and Galway, Ireland. For more information about Merit, visit
www.merit.com.
Statements contained in this release which are not purely historical
are forward- looking statements within the meaning of the Private Securities
Litigation Act of 1995 and are subject to risks and uncertainties such as those
described in Merit's Annual Report on Form 10-K for the year ended December 31,
2002. Such risks and uncertainties include introduction of products in a timely
fashion, market acceptance of new products, cost increases, fluctuations in and
obsolescence of inventory, price and product competition, availability of labor
and materials, development of new third-party products and techniques that
render the Company's products obsolete, delays in obtaining regulatory
approvals, potential product recalls, foreign currency fluctuations, changes in
health care markets related to health care reform initiatives, litigation and
other factors referred to in the Company's 10-K and other reports filed with the
Securities and Exchange Commission. All subsequent forward-looking statements
attributable to the Company or persons acting on its behalf are expressly
qualified in their entirety by these cautionary statements. Actual results may
differ materially from anticipated results. Financial estimates are subject to
change and are not intended to be relied upon as predictions of future operating
results, and Merit assumes no obligation to update or disclose revisions to
those estimates.
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