BURLINGTON, Mass., Oct. 28, 2010 (GLOBE NEWSWIRE) -- Palomar Medical Technologies, Inc. (Nasdaq:PMTI), a leading researcher and developer of light-based systems for cosmetic treatments, today announced financial results for the third quarter ended September 30, 2010. Revenues for the quarter ended September 30, 2010 increased to $15.8 million, as compared to $14.5 million reported in the third quarter of 2009. Product and service revenues increased to $13.0 million, a 16 percent increase over the $11.2 million reported in the third quarter of 2009. Third quarter gross margin from product and service revenues was 60 percent, an increase over the 57 percent reported in the third quarter of 2009. Loss before income taxes for the third quarter ended September 30, 2010 was $2.0 million, which included a $1.5 million patent litigation expense and a $0.9 million non-cash stock-based compensation expense. Loss before income taxes for the third quarter ended September 30, 2009 was $0.2 million, which included a $100,000 patent litigation expense and a $1.0 million non-cash stock-based compensation expense. The Company reported net loss of $2.0 million, or $0.11 per share for the third quarter of 2010 and $0.3 million for the third quarter of 2009. The balance sheet continues to be strong with $102.8 million in cash, cash equivalents, short-term investments and marketable securities with no borrowings.
Chief Executive Officer Joseph P. Caruso commented, "Given the current economic climate, we are happy with the progress we are making, especially the trends experienced in the last few quarters. Our 23% increase in product revenues this quarter as compared to the same quarter last year is gratifying as this is the fourth consecutive quarter of growth and the largest percentage growth year over year in the last three years. Prices are stable and gross margins remain strong throughout the world. Our gross margin this quarter was a big improvement over the same time last year. Our efforts over the past two years to increase our international distribution are also paying off with 48% of total product and service revenues coming from outside North America. Our product portfolio and platform approach gives us the flexibility to adjust our business to meet the challenges in today's economy. Our sales and distribution network configure technology solutions to fit physicians' sites throughout the world in response to the particular economic pressure they are experiencing. We have also had great success with shifting our business model from principally one-time capital equipment sales to include recurring sources. This quarter, 41% of our revenue was generated from recurring sources."
Mr. Caruso continued, "We continue to invest in our consumer products initiative. Our branding and packaging are complete and we are building inventory to support a planned launch early next year. This is a new and exciting challenge for us representing a great opportunity to grow the business in the future."
Conference Call: As previously announced, Palomar will conduct a conference call and webcast today at 11:30 AM Eastern Time. Management will discuss financial results and strategic matters. If you would like to participate, please call (866) 800-8651 or listen to the webcast in the About Palomar/Investors section of the Company's website at www.palomarmedical.com. A webcast replay will also be available.
About Palomar Medical Technologies Inc: Palomar is a leading researcher and developer of light-based systems for cosmetic treatments. Palomar pioneered the optical hair removal field, when, in 1997, it introduced the first high-powered laser hair removal system. Since then, many of the major advances in light-based cosmetic treatments have been based on Palomar technology. In December 2006, Palomar became the first company to receive a 510(k) over-the-counter (OTC) clearance from the United States Food and Drug Administration (FDA) for a new, patented, home-use, light-based hair removal device. In June 2009, Palomar became the first company to receive a 510(k) OTC clearance from the FDA for a new, patented, home-use, laser device for the treatment of periorbital wrinkles. OTC clearance allows the product to be marketed and sold directly to consumers without a prescription. There are now millions of light-based cosmetic procedures performed around the world every year in physician offices, clinics, spas and salons. Palomar is testing many new and exciting applications to further advance the hair removal market and other cosmetic applications. Palomar is focused on developing proprietary light-based technology for introduction to the mass markets.
For more information on Palomar and its products, visit Palomar's website at www.palomarmedical.com. To continue receiving the most up-to-date information and latest news on Palomar as it happens, sign up to receive automatic e-mail alerts by going to the About Palomar/Investors section of the website.
With the exception of the historical information contained in this release, the matters described herein contain forward-looking statements, including, but not limited to, statements relating to new markets, future royalty amounts due from third parties, development and introduction of new products, and financial and operating projections. These forward-looking statements are neither promises nor guarantees, but involve risk and uncertainties that may individually or mutually impact the matters herein, and cause actual results, events and performance to differ materially from such forward-looking statements. These risk factors include, but are not limited to, results of future operations, technological difficulties in developing or introducing new products, the results of future research, lack of product demand and market acceptance for current and future products, the effect of economic conditions, challenges in managing joint ventures and research with third parties and government contracts, the impact of competitive products and pricing, governmental regulations with respect to medical devices, including whether FDA clearance will be obtained for future products and additional applications, the results of litigation, difficulties in collecting royalties, potential infringement of third-party intellectual property rights, factors affecting the Company's future income and resulting ability to utilize its NOLs, and/or other factors, which are detailed from time to time in the Company's SEC reports, including the report on Form 10-K for the year ended December 31, 2009 and the Company's quarterly reports on Form 10-Q. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
| Palomar Financial Summary: | ||||
| Consolidated Statements of Operations (Unaudited) | ||||
|
Three Months Ended September 30, |
Nine Months Ended September 30, |
|||
| 2010 | 2009 | 2010 | 2009 | |
| Revenues: | ||||
| Product revenues | $9,273,158 | $7,528,645 | $27,655,391 | $23,939,493 |
| Service revenues | 3,749,164 | 3,700,511 | 11,512,299 | 10,884,073 |
| Royalty revenues | 1,499,182 | 1,264,022 | 4,444,327 | 4,032,039 |
| Funded product development revenues | -- | 806,482 | -- | 1,636,082 |
| Other revenues | 1,250,000 | 1,250,000 | 3,750,000 | 3,750,000 |
| Total revenues | 15,771,504 | 14,549,660 | 47,362,017 | 44,241,687 |
| Costs and expenses: | ||||
| Cost of product revenues | 3,781,473 | 2,873,956 | 10,583,241 | 9,849,383 |
| Cost of service revenues | 1,367,316 | 1,901,303 | 4,320,439 | 5,417,280 |
| Cost of royalty revenues | 599,673 | 505,609 | 1,777,731 | 1,612,816 |
| Research and development | 3,545,622 | 3,305,311 | 11,320,691 | 10,125,279 |
| Selling and marketing | 4,663,632 | 4,062,930 | 14,408,442 | 13,464,732 |
| General and administrative | 4,267,535 | 2,451,496 | 11,579,566 | 7,566,053 |
| Total costs and expenses | 18,225,251 | 15,100,605 | 53,990,110 | 48,035,543 |
| Loss from operations | (2,453,747) | (550,945) | (6,628,093) | (3,793,856) |
| Interest income | 108,630 | 218,169 | 309,747 | 551,817 |
| Other income | 390,784 | 156,941 | 212,922 | 506,761 |
| Loss before income taxes | (1,954,333) | (175,835) | (6,105,424) | (2,735,278) |
| Provision for (benefit from) income taxes | 69,454 | 120,752 | 117,456 | (780,319) |
| Net loss | $(2,023,787) | $(296,587) | $(6,222,880) | $(1,954,959) |
| Net loss per share: | ||||
| Basic | $(0.11) | $(0.02) | $(0.34) | $(0.11) |
| Diluted | $(0.11) | $(0.02) | $(0.34) | $(0.11) |
| Weighted average shares outstanding: | ||||
| Basic | 18,561,877 | 18,065,655 | 18,539,847 | 18,058,246 |
| Diluted | 18,561,877 | 18,065,655 | 18,539,847 | 18,058,246 |
| Consolidated Balance Sheets (Unaudited) | ||
|
September 30, 2010 |
December 31, 2009 |
|
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | $76,623,685 | $81,948,482 |
| Short-term investments | 1,999,675 | 25,000,000 |
| Total cash, cash equivalents and short-term investments | 78,623,360 | 106,948,482 |
| Accounts receivable, net | 5,035,232 | 4,436,219 |
| Inventories | 12,218,475 | 11,126,352 |
| Other current assets | 1,783,674 | 2,179,233 |
| Total current assets | 97,660,741 | 124,690,286 |
| Marketable securities, at estimated fair value | 24,129,348 | 4,024,313 |
| Property and equipment, net | 37,271,766 | 34,629,410 |
| Other assets | 218,716 | 126,087 |
| Total assets | $159,280,571 | $163,470,096 |
| Liabilities and Stockholders' Equity | ||
| Current Liabilities: | ||
| Accounts payable | $3,326,847 | $2,696,217 |
| Accrued liabilities | 9,245,816 | 8,959,679 |
| Deferred revenue | 3,793,124 | 5,221,924 |
| Total current liabilities | 16,365,787 | 16,877,820 |
| Accrued income taxes | 2,788,802 | 2,965,077 |
| Total liabilities | $19,154,589 | $19,842,897 |
| Stockholders' equity: | ||
| Preferred stock, $.01 par value-- | ||
| Authorized - 1,500,000 shares | ||
| Issued -- none | -- | -- |
| Common stock, $.01 par value-- | ||
| Authorized - 45,000,000 shares | ||
| Issued – 18,573,262 and 18,521,045 shares, respectively | 185,733 | 185,211 |
| Additional paid-in capital | 209,629,876 | 206,740,492 |
| Accumulated other comprehensive loss | (460,540) | (292,297) |
| Accumulated deficit | (69,229,087) | (63,006,207) |
| Total stockholders' equity | $140,125,982 | $143,627,199 |
| Total liabilities and stockholders' equity | $159,280,571 | $163,470,096 |