Exhibit 99.1
LASERSCOPE REPORTS 2005 FIRST QUARTER RESULTS AND RAISES 2005 GUIDANCE
UROLOGY BUSINESS EXCEEDS EXPECTATIONS WITH RECORD WORLDWIDE PERFORMANCE IN
BOTH SYSTEM AND FIBER SALES
2005 First Quarter Highlights (compared to the prior-year quarter):
- GreenLight(TM) fiber volumes used for PVP increased almost 154% to 16,255
units.
- Total revenues grew more than 50% to $28.2 million.
- Operating income increased almost 135% to a record $6.1 million.
- Net income grew more than 124% to $5.0 million
- Gross margins grew to 62% from 57%.
SAN JOSE, Calif., April 27 /PRNewswire-FirstCall/ -- Laserscope (Nasdaq:
LSCP), a pioneer in the development and commercialization of medical lasers and
advanced fiber-optic devices, today reported revenues of $28.2 million for its
first quarter ended March 31, 2005, a 50.3% increase from $18.8 million in the
first quarter of 2004. The increase in revenues was primarily attributable to
continued strong growth in sales of the Company's line of GreenLight(TM)
products for Photo-Selective Vaporization of the Prostate ("PVP"). First quarter
2005 operating income grew 134.8% to $6.1 million, from $2.6 million for the
first quarter of 2004. First quarter 2005 net income was $5.0 million, or $0.22
per diluted share, a substantial increase from net income of $2.2 million, or
$0.10 per diluted share, in the same quarter last year.
"We reported very strong results again this quarter, driven primarily by
exceptional growth in our urology business worldwide," said Eric Reuter,
President and Chief Executive Officer of Laserscope. "As our installed base of
GreenLight laser systems continues to expand around the globe, and as sales of
our single-use fiber-optic delivery device increase, we're gathering more and
more evidence that the PVP procedure using the GreenLight laser system is
gaining an increasing share of the BPH treatment market, not just at the expense
of highly invasive surgical procedures such as Trans-Urethral Resection of the
Prostate ("TURP"), but now at the expense of the so-called thermal therapies and
non-surgical treatment options, such as drug therapy, as well.
"While we also saw a year-over-year decline in aesthetic product sales this
quarter, we believe this development was largely due to the short-term effects
of several structural changes implemented in our aesthetics sales organization
during the first quarter of 2005, changes that we hope will accommodate and
drive future long-term growth in our aesthetics business. As a result, we
believe our solid foundation of existing and upcoming light-based treatment
products, and continued strong customer demand in the aesthetic treatment
market, will enable us to move ahead in the current quarter and in the
foreseeable future, even in an ever more competitive environment."
Gross margin in the first quarter of 2005 grew to approximately 62%,
compared with approximately 57% in the first quarter of 2004. The increase in
2005 first quarter gross margin percentage resulted from a higher mix of
GreenLight products.
Selling, general and administrative (SG&A) expenses were $9.9 million, or
35% of revenues, in the first quarter of 2005, compared with $6.8 million, or
36% of revenues in the first quarter of 2004. Increased SG&A spending resulted
primarily from higher commissions paid commensurate with the increase in
revenues, higher marketing and clinical education expenses related to expanding
the presence of the Company's products in both domestic and international
markets, as well as increased costs related to Sarbanes-Oxley Section 404
compliance.
The Company's effective tax rate for the first quarter of 2005 was 20%,
compared to 13% in the first quarter of 2004. The difference in the rates is due
to a lower relative benefit of net operating loss carry forwards in the first
quarter of 2005.
The Company's financial position remains strong. At March 31, 2005,
Laserscope had no bank borrowings and a cash position of $22.0 million, up
significantly from $16.0 million at December 31, 2004. Shareholders' equity
increased from $42.9 million at December 31, 2004 to $49.3 million at March 31,
2005.
Urology Business Update
"Our urology business continues to surpass our expectations as adoption of
the PVP procedure using the GreenLight laser system is increasing in all major
geographic regions of the world," said Mr. Reuter. "We sold 90 GreenLight laser
systems during the first quarter and more than 16,000 single-use disposable
fibers. GreenLight fiber sales growth was impressive in both the United States
and overseas, as we posted 135% and 222% gains, respectively, year-over-year.
"We have long said that the potential market for PVP is millions of men
annually and growing worldwide along with the aging population. Additionally, we
expect the worldwide demand for PVP to continue to rise as more and more
patients, physicians, and health care insurers become aware of the combined
outstanding clinical outcomes, long-term durability, safety profile, and
cost-effectiveness of this procedure. We believe that the rapid worldwide
adoption of PVP using the GreenLight laser system validates our contention that
no other known therapy provides these kinds of benefits to all the relevant
stakeholders in the treatment process. In the United States, current estimates
show that approximately 11 million men, or 30% of all men over the age of 50,
will suffer from the symptoms of BPH over the course of their lifetimes, and
further, that 20% of those men will require treatment. Overseas the numbers are
even more compelling, where the ultimate market for our procedure is estimated
at four to 10 times that of the United States. We have made strong progress in
international markets to date, but believe there is still much work to be done,
and challenges to be overcome, to fulfill the opportunity in our key
international markets. We will continue to educate health care system providers,
patients, and physicians at home and abroad about the safety profile and
cost-effectiveness of PVP over alternative therapies. Distribution agreements
such as the ones we've established in Germany, Russia, Latin America and the
Caribbean will help us penetrate new and underserved markets around the globe,
and throughout the year we'll be working to secure additional relationships that
provide market entry or an enhanced presence in key geographies."
Aesthetics Business Update
"By offering a full line of easy to use and competitively valued aesthetics
products, we believe Laserscope is well positioned to capitalize on the growing
worldwide demand for cosmetic treatments," continued Mr. Reuter. "This demand,
which is being fueled by many factors, including the need by physicians to
uncover additional revenue streams, will be best satisfied by companies that can
provide versatile and multi-use systems that are quick, efficacious, and provide
patients with a high level of comfort and satisfaction. Our Gemini(TM) system
has already gained wide appeal in the marketplace, while our newest product, the
Solis(TM), has received an enthusiastic welcome since its introduction a few
months ago at the American Academy of Dermatology Annual Meeting. The Solis is
expected to begin shipping sometime this summer. We believe these two products
will enable us to compete in the challenging highly-competitive aesthetic
treatment market."
Full Year 2005 Guidance
The management of Laserscope has raised full year 2005 guidance as follows:
. 2005 full year revenues are expected to be in the range of $130 million to
$135 million.
. Reported pre-tax earnings are expected to be in the range of $30 million
to $33 million.
. Net income is expected to be in the range of $0.79 to $0.87 per fully
diluted share, assuming a fully taxed basis of approximately 38%. This is
without giving consideration to the potential benefit of the deferred tax
asset or its associated reserve. The ultimate release of the deferred tax
asset reserve will depend on not only the level of achievement of our
operating projections but also the timing of other non-operating tax
deductions such as the exercise of employee stock options. We intend to
continue to evaluate the reserve each quarter consistent with GAAP.
. Sequential growth in 2005 revenues and earnings is expected to be more
heavily weighted to the second half of the year, as was the case in 2003
and 2004.
"Our overall business strategy is driven by the considerable and growing
market for the treatment of conditions of aging. We are focused on improving the
quality and cost-effectiveness of healthcare by offering safe, minimally
invasive and clinically effective surgical solutions. As a result, we believe
Laserscope is well positioned to not only create value for our shareholders, but
to continue to make a substantial difference in the quality of life for people
throughout the world," said Mr. Reuter.
Management Conference Call
Management of Laserscope will hold a conference call on Wednesday, April 27,
2005 at 8:00 am PT / 11:00am ET to discuss results for the first quarter of
2005. To participate in the call, please dial 800-257-6607 (303-262-2194 for
international callers) at least five minutes prior to the start time.
Investors will also have the opportunity to listen to the conference call
live on the Internet through Laserscope's website at www.laserscope.com.
Investors should go to the website a few minutes early, as it may be necessary
to download audio software to access the conference call.
A replay of the conference call will be available through May 4, 2005 by
dialing 800-405-2236 (303-590-3000 for international callers), and entering
passcode 11029057. A replay of the webcast will also be available at
Laserscope's website.
About Laserscope
Laserscope designs, manufactures, sells and services on a worldwide basis an
advanced line of medical laser systems and related energy delivery devices for
the office, outpatient surgical center, and hospital markets. More information
about Laserscope can be found on the Company's web site at www.laserscope.com.
Safe Harbor Statement
This press release contains forward-looking information within the meaning
of Section 21E of the Securities Exchange Act of 1934, and is subject to the
safe harbor created by this section. These forward-looking statements include:
statements about Laserscope's future profitability and operating results,
competition, expected continued momentum of Laserscope's business and growth
including new product offerings, worldwide adoption rates of the PVP procedure
using our GreenLight(TM) laser system and market penetration opportunities in
international markets such as Germany, Russia and Latin America among others.
These statements are subject to a number of risks and uncertainties, including:
uncertainties regarding introduction of new technologies competitive to our
products and the degree to which our current and new products are accepted by
customers, which could affect the level of demand for our products; our
dependence on sole source providers for key components and products; risk of
reductions in government and private insurance reimbursement of hospitals and
physicians for health care costs, which may negatively impact hospitals and
physicians decisions to purchase our products reducing adoption rates and sales
growth; risks that we may be unable to protect adequately the integrity, safety
and proper use of our disposable fiber optic delivery device with the GreenLight
laser system, which could result in negative patient outcomes and reduce our
disposable fiber recurring revenue stream; risks that patents and licenses that
we hold may be challenged, invalidated or circumvented or that we may become the
subject of intellectual property litigation; and uncertainties that new products
will receive regulatory approval in applicable jurisdictions. Actual results may
differ materially due to these and other factors. The matters discussed in this
press release also involve risks and uncertainties described from time to time
in Laserscope's filings with the Securities and Exchange Commission. In
particular, see the Risk Factors described in Laserscope's most recent Quarterly
Report on Form 10-Q and Annual Report on Form 10-K. Copies of Laserscope's
public disclosure filings with the SEC, including the most recent Annual Report
on Form 10-K and the most recent forms 10-Q are available upon request from its
Investor Relations Department at its website at www.laserscope.com. Laserscope
assumes no obligation to update the forward- looking information contained in
this press release.
At Laserscope: At Financial Relations Board:
Eric Reuter, President & CEO Tricia Ross Analyst/Investor Contact
Dennis LaLumandiere, CFO (617) 520-7064
(408) 943-0636 Laurie Berman, General Information
(310) 854-8315
LASERSCOPE
GREENLIGHT PV(TM) FIBER SALES
(UNITS)
2005 Q1
- ------------- --------
United States 11,792
International 4,463
Total 16,255
2004 Q1 Q2 Q3 Q4 Year
- ------------- -------- -------- -------- ------- --------
United States 5,018 6,908 7,024 10,211 29,161
International 1,385 1,582 2,967 2,269 8,203
Total 6,403 8,490 9,991 12,480 37,364
LASERSCOPE FINANCIAL SUMMARY
(Unaudited)
Condensed Consolidated Statements of Income
Three Months Ended
March 31,
---------------------------
($ in thousands except per share amounts) 2005 2004
- --------------------------------------------- ------------ ------------
Net revenues $ 28,177 $ 18,750
Cost of sales 10,577 8,082
Gross margin 17,600 10,668
Operating expenses:
Research and development 1,518 1,239
Selling, general and administrative 9,945 6,815
11,463 8,054
Operating income 6,137 2,614
Interest and other income (expense), net 79 (69)
Income before income taxes 6,216 2,545
Provision for income taxes 1,253 331
Net income $ 4,963 $ 2,214
Basic net income per share $ 0.23 $ 0.11
Diluted net income per share $ 0.22 $ 0.10
Shares used in basic per share calculations 22,009 20,342
Shares used in diluted per share calculations 22,986 22,682
Condensed Consolidated Balance Sheets
March 31, December 31,
($ in thousands) 2005 2004
- --------------------------------------------- ------------ ------------
Assets
Current assets:
Cash & cash equivalents $ 21,970 $ 15,954
Accounts receivable, net 22,245 20,342
Inventories 22,849 19,446
Prepayments and other current assets 1,488 1,471
Total current assets 68,552 57,213
Property and equipment, net 3,789 3,457
Other assets 925 919
Total assets $ 73,266 $ 61,589
Liabilities and Shareholders' Equity
Current liabilities $ 23,982 $ 18,647
Capital leases 25 31
Shareholders' equity 49,259 42,911
Total liabilities and shareholders' equity $ 73,266 $ 61,589
SOURCE Laserscope
-0- 04/27/2005
/CONTACT: Eric Reuter, President & CEO, or Dennis LaLumandiere, CFO, both
of Laserscope, +1-408-943-0636; or Tricia Ross, Analyst/Investor Contact,
+1-617-520-7064, or Laurie Berman, General Information, +1-310-854-8315, both
of Financial Relations Board, for Laserscope/
/Web site: http://www.laserscope.com /