Exhibit 99.1
SYMMETRY MEDICAL REPORTS THIRD QUARTER RESULTS
Highlights:
* Revenue increased to $67.2 million, up 24.2% over third quarter 2004
* Net income increased to $8.2 million, or $0.24 per diluted share over
third quarter 2004
* Completed an equity offering of 11.0 million secondary shares and 0.5
million primary shares, doubling shares available for trading
* Initiated construction of previously announced 30,000 square foot Design &
Development Center (DDC) in Warsaw, IN
* In October, relocated Symmetry Medical Cheltenham in the UK , to a larger
25,000 square foot facility
WARSAW, Ind., Nov. 2 /PRNewswire-FirstCall/ -- Symmetry Medical Inc. (NYSE:
SMA), an independent provider of products to the global orthopedic device
industry, announced today third quarter 2005 financial results for the period
ended October 1, 2005.
The Company reported third quarter 2005 revenue of $67.2 million, a 24.2%
increase over revenue of $54.1 million for the third quarter of 2004.
Gross profit for the third quarter of 2005 was $19.7 million, a 23.1%
increase over gross profit of $16.0 million for the third quarter of 2004. Gross
margin for the third quarter was 29.4%, compared to a gross margin of 29.6% for
the third quarter 2004.
Operating income for the third quarter of 2005 was $12.3 million, an 18.2%
increase over operating income of $10.4 million for the third quarter of 2004.
Operating margin for the third quarter was 18.3%, compared to an operating
margin of 19.2% for the third quarter 2004. The variance in operating margin
reflects increased third quarter 2005 selling, general and administrative
expense related to tax consulting services that have resulted in significant tax
benefits, and additional fees and expenses related to Sarbanes-Oxley compliance.
The combination of these items resulted in an expense of $0.5 million in the
third quarter.
Income before income taxes for the third quarter of 2005 was $10.8 million,
a 60.6% increase over the $6.7 million for the third quarter of 2004.
The Company's third quarter 2005 earnings were reduced by $0.02 per diluted
share, attributed to the expense associated with the completion of the secondary
offering in July 2005, and were increased by $0.03 per diluted share largely
from a cumulative research and development tax credit obtained in the third
quarter.
Net income applicable to common shareholders was $8.2 million, or $0.24 per
diluted share, compared to net income applicable to common shareholders of $2.0
million, or $0.12 per diluted share, for the quarter ended October 2, 2004. The
weighted average number of diluted shares outstanding during the third quarter
of 2005 was 34,987,000, which include the impact of 500,000 primary common
shares issued in July 2005.
During the third quarter, Symmetry Medical initiated construction of its
previously announced 30,000 square foot Design & Development Center (DDC) in
Warsaw, IN. The Company estimates that total cost for the facility will be
approximately $2.5 million. In October, Symmetry Medical Cheltenham Ltd.
relocated to a larger 25,000 square foot facility more than doubling the size of
the Company's operation devoted to its European design and development services
and instrument business.
Brian Moore, President and Chief Executive Officer, stated, "We are pleased
with our third quarter results, given the seasonal impact of the summer months
on the orthopedic business. With the opening of the Cheltenham facility and the
ongoing construction of the DDC in Warsaw, we are positioned to expand globally
and to meet the demands of our orthopedic customers."
Financial Guidance
The following statements are based on current market conditions and foreign
currency comparisons. These statements are forward-looking, and actual results
may differ materially. These statements do not include the potential impact of
new business or license agreements the Company may enter in future periods. The
factors discussed above are not intended to be an exhaustive list of the factors
that may affect our future performance.
For the total year 2005, the Company has increased its full year revenue
guidance to be in the range of $258 million to $261 million. The company
currently expects full year 2005 earnings per diluted share in the range of
$0.90 to $0.92, which includes one-time charges of $0.02 per share in connection
with the Company's secondary offering completed in July 2005. This guidance also
includes additional expenses related to Sarbanes-Oxley compliance.
Conference Call
Symmetry Medical will host a conference call at 10:30 a.m. ET on Thursday,
November 3, 2005, to discuss its third quarter results. A live Web cast of the
conference call will be available online from the investor relations page of the
Company's corporate Web site at http://www.symmetrymedical.com. The dial-in
numbers are (800) 510-0178 for domestic callers and (617) 614-3450 for
international callers. The reservation number for both is 81537433. After the
live Web cast, the call will remain available on Symmetry's Web site through
December 1, 2005. In addition, a telephonic replay of the call will be available
until November 20, 2005. The replay dial-in numbers are (888) 286-8010 for
domestic callers and (617) 801-6888 for international callers. Please use
reservation code 23944392.
About Symmetry Medical Inc.
Symmetry Medical Inc. is an independent provider of implants and related
instruments and cases to the orthopedic device industry. The Company also
designs, develops and produces these products for companies in other segments of
the medical device market, including dental, osteobiologic and endoscopy sectors
and provides limited specialized products and services to non-healthcare
markets, such as the aerospace market.
Statements in this press release regarding Symmetry Medical Inc.'s business,
which are not historical facts may be "forward-looking statements" that involve
risks and uncertainties. Forward-looking statements frequently are identified by
the use of terms such as "may," "will," "should," "expect," "believe,"
"estimate," "intend" and similar words indicating possible future events or
actions. Actual results could differ materially from those projected, implied or
anticipated by our forward-looking statements. Certain factors that could cause
actual results to differ include: the loss of one or more customers; the
development of new products or product innovations by our competitors; product
liability; changes in management; changes in conditions affecting the economy,
orthopedic device manufacturers or the medical device industry generally; and
changes in government regulation of medical devices and third-party
reimbursement practices. For a discussion of these and other risks and
uncertainties that could cause actual results to differ from those contained in
the forward-looking statements, see "Risk Factors" in the Company's prospectus
filed on July 19, 200, as well as the Company's other filings with the
Securities and Exchange Commission which are available on the SEC's website at
http://www.sec.gov. All forward-looking statements are qualified in their
entirety by this cautionary statement, and Symmetry Medical Inc. undertakes no
obligation to revise or update this news release to reflect events or
circumstances after the date hereof.
Investors/Media: Contact:
The Ruth Group Symmetry Medical Inc.
Stephanie Carrington/Jason Rando Andrew Miclot
646-536-7017/7025 Senior Vice President
scarrington@theruthgroup.com Marketing, Sales & Business Development
jrando@theruthgroup.com Investor Relations Officer
574-269-7390 ext. 1002
Selected Financial Information
Symmetry Medical Inc.
Condensed Consolidated Balance Sheets
(In Thousands, Except Per Share Data)
October 1, January 1,
2005 2005
------------ ------------
(unaudited)
Assets:
Current Assets:
Cash and cash equivalents $ 15,475 $ 4,849
Accounts receivables, net 44,292 39,640
Inventories 35,663 34,083
Refundable income taxes 1,016 2,578
Deferred income taxes 2,106 2,036
Other current assets 3,013 5,635
Total current assets 101,565 88,821
Property and equipment, net 91,499 71,854
Interest rate swap valuation asset 658 486
Goodwill 125,260 127,369
Intangible assets, net of accumulated
amortization 16,577 17,327
Other assets 899 1,011
Total Assets $ 336,458 $ 306,868
Liabilities and Shareholders' Equity:
Current Liabilities:
Accounts payable $ 19,373 $ 17,908
Accrued wages and benefits 9,925 9,384
Other accrued expenses 2,945 3,012
Income tax payable 2,173 2,008
Revolving line of credit 3,265 1,204
Current portion of capital lease
obligations 3,259 3,572
Current portion of long-term debt 1,313 879
Total current liabilities 42,253 37,967
Deferred income taxes 9,925 9,547
Capital lease obligations, less
current portion 9,141 11,709
Long-term debt, less current portion 27,563 31,500
Total Liabilities 88,882 90,723
Commitments and contingencies (Note 10)
Shareholders' Equity:
Common Stock, $.0001 par value;
72,410 shares authorized; shares
issued (October 1, 2005--34,684;
January 1, 2005--33,174) 3 3
Additional paid-in capital 268,487 255,509
Retained earnings (deficit) (24,671) (49,178)
Accumulated other comprehensive
income 3,757 9,811
Total Shareholders' Equity 247,576 216,145
Total Liabilities and Shareholders'
Equity $ 336,458 $ 306,868
Symmetry Medical Inc.
Condensed Consolidated Statements of Operations
(In Thousands, Except Per Share Data)
Three Months Ended Nine Months Ended
---------------------------- ----------------------------
October 1, October 2, October 1, October 2,
2005 2004 2005 2004
------------ ------------ ------------ ------------
(unaudited) (unaudited) (unaudited) (unaudited)
Revenue $ 67,228 $ 54,126 $ 201,165 $ 153,053
Cost of Revenue 47,486 38,087 140,593 108,363
Gross Profit 19,742 16,039 60,572 44,690
Selling, general, and
administrative expenses 7,455 5,647 21,157 16,975
Operating Income 12,287 10,392 39,415 27,715
Other (income) expense:
Interest expense 635 3,688 2,347 10,852
Interest rate swap valuation (65) (24) (172) (809)
Other 927 9 1,811 (230)
Income before income taxes 10,790 6,719 35,429 17,902
Income tax expense 2,567 2,285 10,922 6,108
Net income 8,223 4,434 24,507 11,794
Preferred stock dividends - 2,409 - 7,069
Net income applicable to common
shareholders $ 8,223 $ 2,025 $ 24,507 $ 4,725
Net income applicable to common
shareholders per share:
Basic $ 0.24 $ 0.13 $ 0.73 $ 0.30
Diluted $ 0.24 $ 0.12 $ 0.71 $ 0.28
Weighted average common shares and
equivalent shares outstanding:
Basic 34,310 15,789 33,575 15,789
Diluted 34,987 16,612 34,526 16,605
Symmetry Medical Inc.
Condensed Consolidated Statements of Cash Flows
(In Thousands)
Nine Months Ended
----------------------------
October 1, October 2,
2005 2004
------------ ------------
(unaudited) (unaudited)
Operating activities
Net Income $ 24,507 $ 11,794
Adjustments to reconcile net income
to net cash provided by (used in)
operating activities:
Depreciation 9,504 7,711
Amortization 456 456
(Gain) loss from sale of assets 71 20
Deferred income tax provision 374 (64)
Income tax benefits from exercise of
stock options 1,199 -
Interest rate swap valuation change (172) (809)
Change in operating assets and
liabilities:
Accounts receivable (6,449) (6,115)
Other assets 2,212 (2,209)
Inventories (2,761) (3,357)
Accounts payable 2,441 5,607
Accrued expenses and other 3,173 3,534
Net cash provided by operating
activities 34,555 16,568
Investing activities
Purchases of property and equipment (31,354) (13,619)
Net cash used in investing activities (31,354) (13,619)
Financing activities
Proceeds from bank revolver 37,065 47,580
Payments on bank revolver (34,695) (45,311)
Payments on long-term debt and
capital lease obligations (6,452) (5,591)
Proceeds from the issuance of common
stock 11,707 -
Payments for redemption of common and
preferred stock - (37)
Net cash provided by financing
activities 7,625 (3,359)
Effect of exchange rate changes on
cash (200) 42
Net increase (decrease) in cash and
cash equivalents 10,626 (368)
Cash and cash equivalents at
beginning of period 4,849 2,348
Cash and cash equivalents at end of
period $ 15,475 $ 1,980
Supplemental disclosures:
Cash paid for interest $ 1,837 $ 9,785
Cash paid for income taxes $ 6,964 $ 2,843
Assets acquired under capital leases $ 283 $ 3,911
SOURCE Symmetry Medical Inc.
-0- 11/02/2005
/CONTACT: Investors-Media: Stephanie Carrington, +1-646-536-7017,
scarrington@theruthgroup.com, or Jason Rando, +1-646-536-7025,
jrando@theruthgroup.com, both of The Ruth Group; or Andrew Miclot, Senior Vice
President, Marketing, Sales & Business Development, Investor Relations Officer
of Symmetry Medical Inc., +1-574-269-7390
ext. 1002/
/Web site: http://www.symmetrymedical.com /