Exhibit 99.1
Natus Medical Reports Record First Quarter Revenue and Earnings;
Company Increases 2005 Earnings Guidance
SAN CARLOS, Calif.--(BUSINESS WIRE)--May 5, 2005--Natus Medical
Incorporated (Nasdaq:BABY) today announced financial results for the
three months ended March 31, 2005.
Natus reported revenue of $9.7 million for the quarter ended March
31, 2005, an increase of $1.1 million or 13% from $8.6 million in the
comparable quarter of the previous year. The Company reported net
income of $910,000, or $0.05 per diluted share, for the first quarter
of 2005, compared with a net loss of $447,000, or ($0.03) loss per
share, for the comparable period in 2004.
Gross margin improved to 60.1% for the three months ended March
31, 2005, compared with 56.2% for the first quarter of 2004. The gross
margin for the 2005 period was favorably impacted by reductions in
materials costs, as well as a reduction in manufacturing overhead as a
percentage of revenue, as it is largely fixed. For the three months
ended March 31, 2005, total operating expenses decreased by $290,000,
or approximately 6%, to $5.0 million, compared with $5.2 million for
the first quarter of 2004.
As of March 31, 2005, the Company reported cash, cash equivalents
and short-term investments of $37.8 million, representing an increase
of approximately $2.1 million from the corresponding amount at
December 31, 2004. Additionally, the Company reported stockholders'
equity of $54.0 million and working capital of $42.2 million as of
March 31, 2005.
"We are extremely pleased with our results for the first quarter,"
said Jim Hawkins, President and Chief Executive Officer of Natus
Medical. "We continue to benefit from the cost control measures we
implemented during the middle of 2004. In addition, we have been able
to grow our top line revenue while at the same time improving our
margins."
"The integration of Natus and Fischer-Zoth continues to go very
well. This acquisition has had a very positive impact upon our results
for the past two quarters, being immediately accretive to our bottom
line. Our strategy continues to focus on internal growth coupled with
strategic acquisitions that we expect to allow us to leverage our
strong and established sales channels," Hawkins added.
Financial Guidance
Natus updated financial guidance for 2005. The Company expects to
report earnings per diluted share of $0.28 to $0.31 on revenue of $41
to $43 million in 2005. This compares to a loss per share of $0.17 on
revenue of $36.5 million reported for 2004. Natus had previously said
it would earn $0.27 to $0.29 per diluted share in 2005 on the same
revenue amounts.
The Company also updated its guidance for the second quarter of
2005. For the three months ending June 30, 2005, the Company expects
to report diluted earnings per share of $0.05 to $0.06, on revenue of
$9.8 to $10.0 million. Natus had previously said it would earn $0.04
to $0.06 per diluted share on revenue of $9.7 to $10.0 million.
In addition, Natus provided quarterly financial guidance for the
second half of 2005. For the third quarter of 2005, the Company
expects to report diluted earnings per share of $0.07 to $0.08, on
revenue of $10.2 to $10.4 million. For the fourth quarter 2005, the
Company expects to report diluted earnings per share of $0.11 to
$0.12, on revenue of $11.3 to $12.9 million.
The estimates of earnings per diluted share do not include the
impact of expensing employee stock options. The SEC has delayed the
effective date for adopting Financial Accounting Standards Board
Statement No. 123R, "Share-Based Payment." The company will be
required to begin expensing employee stock options in its first
quarterly period in 2006.
Conference Call
Natus has scheduled an investor conference call to discuss this
announcement beginning at 11:00 a.m. Eastern Time today. Individuals
interested in listening to the conference call may do so by dialing
(800) 510-9691 for domestic callers, or (617) 614-3453 for
international callers, and entering reservation code 89915360. A
telephone replay will be available for 48 hours following the
conclusion of the call by dialing (888) 286-8010 for domestic callers,
or (617) 801-6888 for international callers, and entering reservation
code 12373136.
The conference call also will be available real-time via the
Internet at http://investor.natus.com, and a recording of the call
will be available on the Company's Web site for 90 days following the
completion of the call.
About Natus Medical
Natus develops, manufactures, and markets products for the
detection, treatment, monitoring, and tracking of common disorders in
newborns. Natus products are marketed under well-recognized brand
names such as ALGO(R), Neometrics(TM), Echo-Screen(R), and
neoBLUE(TM). Headquartered in San Carlos, California, Natus markets
and sells its products worldwide through a direct sales force in the
U.S. and the U.K., and through distributors in over 50 other
countries. Additional information about Natus Medical can be found at
www.natus.com.
This press release contains forward-looking statements as defined
in the Private Securities Litigation Reform Act of 1995, particularly
statements regarding the expectations, beliefs, plans, intentions and
strategies of Natus. These forward-looking statements include, but are
not limited to, statements regarding anticipated revenue and
profitability for the full-year 2005 as well as for the second, third,
and fourth quarters of 2005, and expectations regarding future growth
and profitability. These statements relate to future events or Natus'
future financial performance or results, and involve known and unknown
risks, uncertainties and other factors that may cause actual results,
levels of activity, performance, or achievements to differ materially
from those expressed or implied by the forward-looking statements.
Forward-looking statements are only predictions and the actual events
or results may differ materially. Natus cannot provide any assurance
that its future results or the results implied by the forward-looking
statements will meet expectations. The results could differ materially
due to a number of factors, including the effects of competition, the
demand for our products and services, our ability to control costs,
and risks associated with integration of acquired businesses. Natus
disclaims any obligation to update information contained in any
forward-looking statement.
More information about potential risk factors that could affect
the business and financial results of Natus is included in Natus'
annual report on Form 10-K for the year ended December 31, 2004, and
its quarterly reports on Form 10-Q, and from time to time in other
reports filed by Natus with the U.S. Securities and Exchange
Commission.
Natus(R), AABR(R), AOAE(R), ALGO(R), ALGO DataBook(R), 70/40(R),
Cochlea-Scan(R), Echo-Screen(R), Ear Couplers(R), Flexicoupler(R),
Jelly Tab(R), Jelly Button(R), and MiniMuffs(R) are registered
trademarks of Natus. Audio-System(TM), Convert2Natus(TM),
DataLink(TM), EchoLink(TM), neoBLUE(TM), Natus Elite(TM), neoBLUE
mini(TM), Neometrics(TM), Metabolic Screening Database System
(MSDS)(TM), Case Management System (CMS)(TM), Voice Response System
(VRS)(TM), Web Electronic Birth Page (Web-EBP)(TM), and Accuscreen(TM)
are non-registered trademarks of Natus. Solutions for Newborn Care(SM)
is a non-registered service mark of Natus.
NATUS MEDICAL INCORPORATED AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
March 31, December 31,
2005 2004
ASSETS
Current assets:
Cash and equivalents $ 26,154 $ 16,239
Short-term investments 11,659 19,504
Accounts receivable, net of allowance
for doubtful accounts of $ 472 in
2005 and $395 in 2004 5,426 6,640
Inventories 3,474 4,347
Prepaid expenses and other current assets 581 625
Total current assets 47,294 47,355
Property and equipment, net 2,514 2,503
Goodwill, intangibles, and other assets 9,228 9,399
Total assets $ 59,036 $ 59,257
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Accounts payable $ 616 $ 1,947
Accrued liabilities 4,090 4,303
Deferred revenues 357 279
Total liabilities 5,063 6,529
Commitments and contingencies - -
Stockholders' equity:
Common stock, $0.001 par value,
120,000,000 shares authorized; shares
issued and outstanding: 17,171,812 in
2005 and 17,140,339 in 2004 89,541 89,373
Accumulated deficit (35,992) (36,902)
Accumulated other comprehensive income 424 257
Total stockholders' equity 53,973 52,728
Total liabilities and
stockholders' equity $ 59,036 $ 59,257
NATUS MEDICAL INCORPORATED AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three Months Ended
Mar 31, Mar 31,
2005 2004
Revenue $ 9,702 $ 8,571
Cost of revenue 3,870 3,758
Gross profit 5,832 4,813
Operating expenses:
Marketing and selling 2,605 2,971
Research and development 993 906
General and administrative 1,363 1,369
Total operating expenses 4,961 5,246
Income (loss) from operations 871 (433)
Other income/(expense):
Interest income 183 97
Interest expense - (3)
Other income, net 9 76
Total other income/(expense) 192 170
Income (loss) before
provision for income tax 1,063 (263)
Provision for income tax 153 1
Income (loss) from continuing operations 910 (264)
Discontinued operations - (183)
Net income (loss) $ 910 $ (447)
Earnings (loss) per share:
Basic:
Continuing operations $ 0.05 $ (0.02)
Discontinued operations $ - $ (0.01)
Net income (loss) $ 0.05 $ (0.03)
Diluted:
Continuing operations $ 0.05 $ (0.02)
Discontinued operations $ - $ (0.01)
Net income (loss) $ 0.05 $ (0.03)
Weighted-average shares used to compute
Basic earnings per share 17,156 16,579
Diluted earnings per share 18,435 16,579
CONTACT: Natus Medical Incorporated
Steven J. Murphy, 650-802-0400
InvestorRelations@Natus.com