EXHIBIT 99.1
Contact: Michael Dale, President/CEO
Jack Judd, Chief Financial Officer
Manny Villafana, Chairman
763/553-7736
763/553-0052 Fax
EVC Group, Inc.
Doug Sherk
415/652-9100
Anne Bugge
206/926-5220
FOR IMMEDIATE RELEASE
ATS MEDICAL REPORTS 69% FIRST QUARTER REVENUE GROWTH
o U.S. HEART CENTER CUSTOMERS GROW TO MORE THAN 200; OVERALL ASP INCREASES
o CONFERENCE CALL SCHEDULED FOR TODAY AT 11 AM EDT
MINNEAPOLIS, April 29, 2004 -- ATS Medical, Inc. (NASDAQ: ATSI) a leader in
mechanical heart valve technology and related cardiac surgical accessories,
today reported that revenue for the first quarter of 2004 increased 69 percent
to a record $6.7 million, as compared with sales of $4.0 million for the first
quarter of 2003. When compared to the fourth quarter of 2003, revenue increased
19 percent.
Net loss for the first quarter of 2004 was $3.3 million compared with $1.5
million for the first quarter of 2003. Net cash used in operations was $0.5
million through the first quarter of 2004 compared to $0.3 million in 2003. Cash
and investments were $8.0 million at March 31, 2004.
Michael D. Dale, President and CEO of ATS Medical commented, "The first quarter
of 2004 represents our seventh consecutive quarter of sales growth and reflects
the successful execution of our sales strategy. Our newly recruited sales
organization was largely in place by September 30 of last year. As the team
gains experience and becomes more proficient in communicating the superior
characteristics of the ATS Open Pivot(R) Valve, we expect to continue building
sales momentum and market share. Our first quarter growth rate of 69% exceeded
our growth rate for the previous quarter of 50%. Sales in the United States grew
to $2.4 million during the quarter, an increase of 180 percent over the first
quarter of 2003, as the number of heart centers purchasing the Open Pivot
surpassed 200. International sales grew to $4.3 million, an increase of 38
percent over the first quarter of 2003."
"Importantly," Mr. Dale continued, "we achieved our strong sales performance
while actually slightly increasing our overall average selling price for the
Open Pivot. We also leveraged our operating platform during the first quarter as
operating costs in the quarter were $5.2 million, in line with our
expectations." "Additionally, we have also taken a significant first step toward
expanding our presence in the cardiac surgery market by offering complementary
products and technology," Dale said. "Through our recently announced agreement
with ErySave AB of Sweden, we have acquired exclusive worldwide rights to a
patented, advanced blood filtration technology that uses ultrasound to remove
potentially dangerous particles of fat (lipid microemboli) that are released
during open heart procedures. Current methods of filtering do not effectively
remove these particles. This product could be used in all patients requiring a
cardiac surgery procedure, such as heart valve replacement or
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repair and coronary artery bypass. Our plans call for us to work with ErySave to
complete development and introduce this product to the market in the last half
of 2005."
"Looking ahead to the remainder of 2004, our strong first quarter performance is
enabling us to increase our revenue growth outlook. We feel confident that ATS
will be able to grow 2004 total revenue by at least 35% versus 2003. We expect
gross margins to fluctuate depending on our customer mix. Cash balances are
adequate to fund current operations throughout the year," concluded Mr. Dale
CONFERENCE CALL TODAY
ATS management will host a conference call and webcast today at 11:00 a.m. EDT
to discuss its first quarter financial results, outlook for 2004 and current
corporate developments. The dial in number for the conference call is
800-257-7063 for domestic participants and 303-262-2211 for international
participants.
A taped replay of the conference call will also be available beginning
approximately one hour after the call's conclusion and will remain available
through 9:00 p.m. EDT on Thursday, May 6, 2004 and can be accessed by dialing
800-405-2236 for domestic callers and 303-590-3000 for international callers,
using the passcode 575771#. A live webcast of the call can be accessed at
www.atsmedical.com by clicking on the Investors icon. The webcast will also be
archived on the company's website.
ABOUT ATS MEDICAL
ATS Medical, Inc., headquartered in Minneapolis, is a leading medical device
company specializing in mechanical heart valves, aortic graft prostheses and
related cardiovascular surgery accessories. ATS is a global company with product
sales in more than 40 countries. The ATS Open Pivot(R) Valve has been implanted
in over 80,000 patients and utilizes a unique pivot design that results in
better performance and a lower risk profile. The Company's website is
www.atsmedical.com.
SAFE HARBOR
This Press Release contains forward-looking statements that may include
statements regarding intent, belief or current expectations of the Company and
its management. Actual results could differ materially from those projected in
the forward looking statements as a result of a number of important factors,
including regulatory actions, competition, pricing pressures, supplier actions
and management of growth. For a discussion of these and other risks and
uncertainties that could affect the Company's activities and results, please
refer to the Company's filings with the Securities and Exchange Commission to
its Form 10-K for the year ended December 31, 2003.
(tables to follow)
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ATS MEDICAL, INC.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands, except per share data)
Three months ended March 31,
----------------------------
2004 2003
-------- --------
Net sales $ 6,694 $ 3,965
Cost of goods sold 4,766 2,748
-------- --------
Gross profit 1,928 1,217
Operating expenses:
Sales and marketing 3,666 1,154
Research and development 187 386
General and administrative 1,381 987
-------- --------
Total operating expenses 5,234 2,527
-------- --------
Operating loss (3,306) (1,310)
-------- --------
Interest (expense) income 1 (229)
-------- --------
Net loss ($ 3,305) ($ 1,539)
======== ========
Net loss per share:
Basic and diluted ($ 0.12) ($ 0.07)
Weighted average number of shares outstanding:
Basic and diluted 26,802 22,318
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ATS MEDICAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
March 31, December 31,
2004 2003
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CURRENT ASSETS
Cash and short-term investments $ 7,986 $ 8,475
Accounts receivable 5,859 4,939
Inventories 20,689 20,377
Prepaid expenses 717 508
------- -------
Total current assets 35,251 34,299
Property and equipment, net 5,738 5,895
Other inventories 13,000 17,000
Technology license 18,500 18,500
Other assets 435 440
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TOTAL ASSETS $72,924 $76,134
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CURRENT LIABILITIES
Accounts payable $ 1,122 $ 989
Accrued payroll 1,031 1,334
Other accrued liabilities 1,141 1,008
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Total current liabilities 3,294 3,331
Shareholders' equity 69,630 72,803
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TOTAL LIABILITIES & SHAREHOLDERS' EQUITY $72,924 $76,134
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ATS MEDICAL, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOW
(in thousands)
Three months
ended March 31,
----------------------
2004 2003
------- -------
OPERATING ACTIVITIES
Net loss ($3,305) ($1,539)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation 265 184
Compensation expense on stock options 25 1
Imputed interest long-term debt 0 160
Changes in operating assets and liabilities 2,527 874
------- -------
Net cash used in operating activities (488) (320)
INVESTING ACTIVITIES
Purchase of short-term investments, net of sales 250 (505)
Net purchases of furniture, machinery and equipment (108) (130)
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Net cash provided by (used in) investing activities 142 (635)
FINANCING ACTIVITIES
Net proceeds from sale of common stock 118 8
------- -------
Net cash provided by financing activities 118 8
Effect of exchange rate changes on cash (11) 1
------- -------
Decrease in cash and
cash equivalents ($ 239) ($ 946)
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