EXHIBIT 99.1
FOR IMMEDIATE RELEASE
CONTACT:
Joseph W. Kaufmann
President and Chief Executive Officer
(610) 524-0188
KENSEY NASH ANNOUNCES EPS OF $0.28 FOR QUARTER, UP 65% FROM PRIOR YEAR;
INCREASES GUIDANCE FOR NEXT QUARTER
-RECORD REVENUE UP 35% FROM PRIOR YEAR-
EXTON, PA, APRIL 20, 2004 -- Kensey Nash Corporation (Nasdaq: KNSY) today
announced record financial results for its third fiscal quarter ended March 31,
2004. Total revenues for the third quarter, which include both net sales and
royalty income, increased 35% to $15.8 million compared to $11.7 million in the
prior year period. Net sales increased 30% to $9.4 million from $7.2 million in
the comparable quarter of the prior fiscal year, while royalty income increased
50% to $6.2 million from $4.2 million. Net income for the quarter increased 78%
to $3.5 million, or $0.28 per share, compared to $2.0 million, or $0.17 per
share, for the prior year period. These results exceeded the previously
announced guidance for the quarter of $14.0 - $14.3 million in revenue and $0.24
- - $0.25 per share for net income.
Kensey Nash's balance sheet continues to be strong with $93.2 million of total
assets, $54.5 million of cash and investments, $87.2 million of
stockholders'equity, and no long-term debt reported at March 31, 2004. During
the quarter, the Company generated cash flow from operations of $4.3 million.
The following table summarizes the results for the Company for the three months
ended March 31, 2004 compared to the three months ended March 31, 2003:
- --------------------------------- -------------- -------------- ----------
PERCENTAGE
(MILLIONS, EXCEPT PER SHARE DATA) MARCH 31, 2004 MARCH 31, 2003 CHANGE
- --------------------------------- -------------- -------------- ----------
Net Sales $9.4 $7.2 30%
- --------------------------------- -------------- -------------- ----------
Royalty Income $6.2 $4.2 50%
- --------------------------------- -------------- -------------- ----------
Total Revenues $15.8 $11.7 35%
- --------------------------------- -------------- -------------- ----------
Operating Income $5.0 $2.9 74%
- --------------------------------- -------------- -------------- ----------
Net Income $3.5 $2.0 78%
- --------------------------------- -------------- -------------- ----------
Earnings Per Share $0.28 $0.17 65%
- --------------------------------- -------------- -------------- ----------
Weighted Average Diluted Shares
Outstanding 12.3 11.6 6%
- --------------------------------- -------------- -------------- ----------
Total revenues for the nine months ended March 31, 2004 increased 35% to $41.9
million compared to $31.1 million in the prior year period. Net sales increased
32% to $24.8 million from $18.8 million in the comparable nine months of the
prior fiscal year. Royalty income increased 42% to $16.7 million from $11.7
million. Net income for the nine months increased 68% to $8.8 million, or $0.72
per share, compared to $5.2 million, or $0.46 per share, for the prior year
period.
"Our overall business is showing tremendous momentum," commented Joseph W.
Kaufmann, President and CEO of Kensey Nash Corporation. "I am very proud of how
our organization is identifying and pursuing opportunities to continue to grow
our company's position in the expanding biomaterials field. During the quarter,
we launched the first bone grafting products from our collaboration with
Orthovita, Inc., with more product launches scheduled in coming quarters.
Overall our biomaterials business increased 31% over last year and 17% over the
second quarter, driven by sales to Orthovita in preparation for their new
product launches, which accounted for over $1 million in revenue, as well as by
continued growth in sports medicine product sales."
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"Angio-Seal(TM) royalties of $6.2 million for the quarter were exceptional. Both
U.S. and international sales of Angio-Seal were strong as St. Jude Medical
continued their market leadership position in the growing vascular closure
device market," Mr. Kaufmann continued.
"Finally, we want to highlight our recent completion of the PRIDE clinical study
as a major accomplishment for the company. The physician feedback about the
potential of this platform technology has been excellent. If approved, the
TriActiv System will be the only embolic protection system that automatically
removes the problematic debris with the push of a button. With close to 900
patients enrolled, almost 700 of which were randomized, we will have a data set
that we believe will be competitive with already approved products and will
allow us to compete on the merits of the system. We continue to target our
510(k) submission for the current quarter," Mr. Kaufmann concluded.
Based on the strong third quarter results and management's visibility going
forward, the Company is raising its previously announced guidance for its fourth
quarter and fiscal year. Total revenues for the fourth fiscal quarter are
estimated to be in the $15.6 to $15.9 million range, including net sales in the
$11.0 to $11.2 million range and royalty income of $4.4 to $4.6 million. The
royalty income estimates reflect the reduction in the royalty rate from 9% to
6%, expected during the current quarter, when St. Jude Medical is anticipated to
achieve the milestone of four million cumulative Angio-Seal(TM) units sold.
Despite the expected reduction in Angio-Seal royalty income of approximately
$1.9 million sequentially, the Company is increasing its earnings per share
guidance for the fourth quarter to $0.30 to $0.31. This guidance includes an
approximate $0.02 per share benefit related to an estimated reduction in the
Company's effective tax rate for fiscal 2004 to approximately 30%. Revenues for
the fiscal year 2004 are expected to exceed $57 million, 30% above fiscal year
2003. Earnings per share for the fiscal year, forecasted at $1.01 to $1.02,
would be 33% greater than the $0.76 reported in fiscal 2003, which included a
$0.10 per share net benefit for research and development tax credits.
The Company will be holding a conference call to discuss the third quarter
earnings results on Wednesday, April 21, 2004 at 11:00 AM eastern time. A live
webcast of the conference call will be broadcast. Please visit the investor
relations page at www.kenseynash.com for the link. To participate in the
conference call, interested parties may call 1-303-262-0062. A replay of the
call will also be available starting April 21, 2004 at 2:30 PM Eastern until
Monday, April 26 at 11:59 PM Eastern by calling 800-475-6701, access code
726916. A recording of the broadcast will be available on the Kensey Nash
website.
About Kensey Nash Corporation
- -----------------------------
Kensey Nash Corporation is a leading developer and manufacturer of absorbable
biomaterials-based products with applications in the cardiology, orthopaedics,
spine, drug and biologics delivery, periodontal/dental, surgical and wound care
markets. The Company was a pioneer in the field of arterial puncture closure, as
the inventor and developer of the Angio-Seal(TM) Vascular Closure Device.
Angio-Seal is licensed to St. Jude Medical, Inc. The Company's TriActiv(R)
Balloon Protected Flush Extraction System for the treatment of saphenous vein
graft disease is commercialized in the European Union. A 510(k) submission is
being prepared for the TriActiv System in the U.S., following the completion of
a major clinical study.
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.
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Cautionary Note Regarding Forward Looking Statements
- ----------------------------------------------------
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 2004. The Company tried to identify
these forward looking statements by using words such as "believes," "expects,"
"forecasts," "anticipates," "estimates," "plans," "should" or similar
expressions, but these words are not the exclusive means for identifying such
statements. 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, the risk that necessary
regulatory approvals will not be obtained, the ability of Kensey Nash to
successfully market the TriActiv System, 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. Except as expressly required by federal
securities laws, 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,
----------------------------- -----------------------------
2004 2003 2004 2003
----------- ----------- ----------- -----------
Revenues:
Net sales ...................................$ 9,402,745 $ 7,249,690 $24,756,449 $18,765,321
Research and development .................... 135,099 246,678 462,208 611,311
Royalty income .............................. 6,237,616 4,171,353 16,660,906 11,725,845
----------- ----------- ----------- -----------
Total revenues ......................... 15,775,460 11,667,721 41,879,563 31,102,477
----------- ----------- ----------- -----------
Operating costs and expenses:
Cost of products sold ....................... 4,275,791 3,239,491 11,155,622 8,560,081
Research and development .................... 4,308,411 3,690,769 12,633,967 10,245,484
Selling, general and administrative ......... 2,222,779 1,885,142 6,255,143 5,090,324
----------- ----------- ----------- -----------
Total operating costs and expenses ..... 10,806,981 8,815,402 30,044,732 23,895,889
----------- ----------- ----------- -----------
Income from operations .......................... 4,968,479 2,852,319 11,834,831 7,206,588
Interest and other income, net .................. 252,005 231,901 798,039 834,388
----------- ----------- ----------- -----------
Pre-tax income .................................. 5,220,484 3,084,220 12,632,870 8,040,976
Income tax expense .............................. 1,735,092 1,125,596 3,870,865 2,838,969
----------- ----------- ----------- -----------
Net income ......................................$ 3,485,392 $ 1,958,624 $ 8,762,005 $ 5,202,007
=========== =========== =========== ===========
Income per common share, assuming dilution ......$ 0.28 $ 0.17 $ 0.72 $ 0.46
=========== =========== =========== ===========
Weighted average common shares outstanding ...... 12,264,132 11,556,775 12,240,327 11,403,112
=========== =========== =========== ===========
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KENSEY NASH CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
MARCH 31, JUNE 30,
2004 2003
----------- -----------
ASSETS
Current assets:
Cash, cash equivalents and investments $54,543,697 $48,411,397
Trade receivables .................... 4,103,514 3,760,286
Other receivables .................... 6,642,319 5,149,497
Officer loan ......................... -- --
Inventory ............................ 4,451,637 3,481,322
Prepaids and other assets ............ 1,725,410 2,564,179
Deferred tax asset, current .......... 627,316 2,097,147
----------- -----------
Total current assets ............ 72,093,893 65,463,828
----------- -----------
Property, plant and equipment, net ........ 15,386,571 13,399,717
Acquired puncture closure patents, net .... 2,476,379 2,673,648
Deferred tax asset, non-current ........... -- 1,017,513
Goodwill .................................. 3,284,303 3,284,303
Restricted investments .................... -- --
----------- -----------
Total assets .............................. $93,241,146 $85,839,009
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 5,234,101 $ 5,038,025
Current portion of debt .............. 434,260 836,989
Deferred revenue ..................... 136,129 195,060
----------- -----------
Total current liabilities ....... 5,804,490 6,070,074
----------- -----------
Long-term debt ............................ -- 219,147
Deferred tax liability, non-current ....... 189,142 --
----------- -----------
Total stockholders' equity ................ 87,247,514 79,549,788
----------- -----------
Total liabilities and stockholders' equity $93,241,146 $85,839,009
=========== ===========
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