EXHIBIT 99.1
FOR IMMEDIATE RELEASE
CONTACT:
Joseph W. Kaufmann
President and Chief Executive Officer
(610) 524-0188
KENSEY NASH ANNOUNCES 99% INCREASE IN NET INCOME DRIVEN
BY 72% INCREASE IN NET SALES FOR ITS THIRD FISCAL QUARTER
-COMPANY FURTHER INCREASES GUIDANCE FOR FISCAL YEAR-
EXTON, PA, APRIL 16, 2003 -- Kensey Nash Corporation (Nasdaq: KNSY) today
announced record financial results for its third fiscal quarter ended March 31,
2003. Total revenues for the third quarter, which include both net sales and
royalty income, increased 61% to $11.7 million compared to $7.2 million in the
prior year period. Net sales increased 72% to $7.2 million from $4.2 million in
the comparable quarter of the prior fiscal year, while royalty income increased
48% to $4.2 million from $2.8 million. Operating income increased 164% to $2.9
million for the quarter and reflects the strength of the company's core
business. Despite the impact of a declining interest rate environment, net
income for the quarter increased 99% to $2.0 million, or $0.17 per share,
compared to $1.0 million, or $0.09 per share, for the prior period. These
results exceeded the previously announced guidance for the quarter of $11.0
million in revenue and $0.16 per share for net income.
Total revenues for the nine months ended March 31, 2003 increased 49% to $31.1
million compared to $20.9 million in the prior year period. Net sales increased
44% to $18.8 million from $13.1 million in the comparable nine months of the
prior fiscal year. Royalty income increased 59% to $11.7 million from $7.4
million. Operating income for the nine months increased 100% to $7.2 million
compared to $3.6 million for the prior year period. Net income for the nine
months increased 64% to $5.2 million, or $0.46 per share, compared to $3.2
million, or $0.28 per share, for the prior period.
Kensey Nash's balance sheet continued to be strong with $76.5 million of total
assets, $68.9 million of stockholders' equity and only $1.3 million of total
debt. During the quarter, the company generated cash from operations of $4.1
million, and reported $41.0 million of cash and investments at March 31, 2003.
"We are pleased to report strong results for the quarter," commented Joseph W.
Kaufmann, president and CEO of Kensey Nash Corporation. "Sales of our
biomaterials products continued to expand significantly exceeding $7 million in
the quarter. This represents an increase of 70% over last year and 12%
sequentially. Sales of both cardiology and sports medicine products were the
primary drivers in the quarter. In addition, Angio-Seal(TM) royalties continued
to increase, resulting in our sixth consecutive record quarter. We had
originally targeted top and bottom line growth for our fiscal year 2003 in
excess of 30%. Now our outlook is for 45 to 50% top line growth and earnings per
share growth of over 50%. This is despite significant increases in research and
development spending, and the establishment of a sales and marketing
infrastructure for the launch of our TriActiv(R) system in Europe."
"We are also pleased to report continuing progress with the commercial launch of
our TriActiv System in Europe and clinical status in the U.S.," Mr. Kaufmann
continued. "This quarter we recorded net sales in excess of $100,000 in the
European Union. Furthermore, we continue to enroll patients in our PRIDE
randomized pivotal clinical trial to support a U.S. regulatory approval. We are
working diligently to complete our enrollment and meet our goal for U.S.
approval in early calendar year 2004," he concluded.
The Company is raising its previously announced guidance for the fourth quarter
and fiscal year. Total revenues for the fourth fiscal quarter are estimated to
be in the $12.0 to $12.5 million range, including net sales in the $7.4 to $7.9
million range, royalty income of $4.3 million and research and development
revenue of $300,000.
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Net of income tax, the Company expects to record approximately $0.18 to $0.19
earnings per share in the fourth quarter and $0.64 to $0.65 for its fiscal year.
A live webcast of the conference call will be broadcast Thursday, April 17, 2003
at 11:00 AM eastern time. Please visit the investor relations page at
www.kenseynash.com for the link. To participate in the conference call,
interested parties may call 612-332-0107. A replay of the call will also be
available starting April 17, 2003 at 2:30 PM Eastern until Tuesday April 22,
2003 at midnight eastern time by calling 800-475-6701, access code 680524. A
recording of the broadcast will be available on the Kensey Nash website for one
year following the date of the call.
Kensey Nash Corporation has significant expertise and experience in designing,
developing, manufacturing and processing proprietary absorbable biomaterials
products for the cardiology, orthopedics, drug and biologics delivery,
periodontal/dental and wound care markets. The Company is also a leader in the
development of cardiovascular medical technology devices for arterial puncture
closure. The Company's TriActiv(R) Balloon Protected Flush Extraction System for
the treatment of saphenous vein graft disease is available for sale in the
European Union and is in clinical trials in the United States. Angio-Seal is a
trademark of St. Jude Medical, Inc.
The TriActiv System is designed to prevent heart attacks during the treatment of
saphenous vein grafts (SVGs) in patients who previously received coronary bypass
surgery, but now have blockages in the grafts. The device incorporates three
features to address the common problem of distal embolization - a protection
balloon guidewire, a flush catheter, and an extraction system to remove debris
from the grafts.
This press release contains forward-looking statements that reflect the
Company's current expectations about its prospects and opportunities, including,
without limitation, the revenue and earnings guidance provided by the Company
for its fourth fiscal quarter and fiscal 2003. The Company tried to identify
these forward looking statements by using words such as "expects,"
"anticipates," "estimates," "plans" or similar expressions. The Company cautions
that a number of risks, uncertainties, and other important factors could cause
the Company's actual results to differ materially from those in the
forward-looking statements including, without limitation, St. Jude Medical's
success in marketing the Angio-Seal(TM) device, demand for and the Company's
ability to develop and manufacture biomaterial products, including
Angio-Seal(TM) components, clinical and marketing success of the TriActiv(R)
system, additional regulatory approvals, and competition from other technologies
in the marketplace. For a more detailed discussion of these and other factors,
please see the Company's SEC filings. The Company undertakes no obligation to
update or revise any forward-looking statements, whether as a result of new
information, changed circumstances or future events or for any other reason.
The Company also cautions that results of operations in any past period should
not be considered indicative of the results to be expected for future periods.
Fluctuations in operating results may also result in fluctuations in the price
of the Common Stock.
-FINANCIAL INFORMATION TO FOLLOW-
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KENSEY NASH CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
THREE MONTHS NINE MONTHS
ENDED MARCH 31, ENDED MARCH 31,
--------------------------- ---------------------------
2003 2002 2003 2002
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Revenues:
Net sales $ 7,249,690 $ 4,209,622 $18,765,321 $13,060,499
Research and development 246,678 198,120 611,311 478,853
Royalty income 4,171,353 2,818,180 11,725,845 7,388,280
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Total revenues 11,667,721 7,225,922 31,102,477 20,927,632
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Operating costs and expenses:
Cost of products sold 3,239,491 2,062,734 8,560,081 6,277,640
Research and development 3,690,769 2,813,438 10,245,484 7,877,592
Selling, general and administrative 1,885,142 1,269,627 5,090,324 3,172,772
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Total operating costs and expenses 8,815,402 6,145,799 23,895,889 17,328,004
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Income from operations 2,852,319 1,080,123 7,206,588 3,599,628
Interest and other income, net 231,901 420,312 834,388 1,248,665
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Pre-tax income 3,084,220 1,500,435 8,040,976 4,848,293
Income tax 1,125,596 517,650 2,838,969 1,672,661
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Net income $ 1,958,624 $ 982,785 $ 5,202,007 $ 3,175,632
=========================== ===========================
Income per common share, assuming dilution $ 0.17 $ 0.09 $ 0.46 $ 0.28
=========================== ===========================
Weighted average common shares outstanding 11,556,775 11,361,024 11,403,112 11,240,536
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CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
MARCH 31, JUNE 30,
2003 2002
ASSETS
Current assets:
Cash, cash equivalents and investments $41,008,355 $31,874,263
Trade receivables 3,456,375 3,331,046
Other receivables 4,708,925 3,645,617
Officer loan 1,962,523 1,882,369
Inventory 3,494,778 2,518,924
Prepaids and other assets 2,121,823 1,160,834
Deferred tax asset, current 375,936 1,313,517
----------- -----------
Total current assets 57,128,715 45,726,570
----------- -----------
Property, plant and equipment, net 12,229,497 11,310,928
Acquired puncture closure patents, net 2,739,405 2,936,674
Deferred tax asset, non-current 1,075,714 1,608,760
Goodwill 3,284,303 3,284,303
Restricted investments - 2,113,072
----------- -----------
Total assets $76,457,634 $66,980,307
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LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities:
Accounts payable and accrued expenses $ 5,983,017 $ 2,810,845
Current portion of debt 821,584 978,902
Deferred revenue 322,625 293,035
----------- -----------
Total current liabilities 7,127,226 4,082,782
----------- -----------
Long-term debt 434,261 1,330,484
----------- -----------
Total stockholders' equity 68,896,147 61,567,041
----------- -----------
Total liabilities and stockholders' equity $76,457,634 $66,980,307
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