TOTOWA, N.J., Aug. 7, 2008 (PRIME NEWSWIRE) -- Vital Signs, Inc. (Nasdaq: VITL) today announced sales and earnings for its fiscal third quarter ended June 30, 2008.
Net revenues for the third quarter of fiscal 2008 increased by 11.5% to $60,684,000 compared with $54,407,000 in the comparable period last year.
Net income increased by 12.3% to $9,685,000 for the third quarter of fiscal 2008 compared with $8,625,000 for the third quarter of fiscal 2007. Earnings per diluted share increased by 12.3% to $0.73 for the third quarter of fiscal 2008 compared with $0.65 for the prior-year quarter.
The Company continues to be a strong cash generator. Cash provided from operating activities for the nine months ended June 30, 2008 was $35.2 million. Vital Signs' Board of Directors approved a quarterly dividend of $0.11 per share payable on August 28, 2008 to shareholders of record on August 21, 2008.
Following are the net revenues by business segment for the third quarter of fiscal 2008 compared with the third quarter of fiscal 2007.
($ Thousands) NET REVENUES BY BUSINESS SEGMENT
-------------------------------------
FOR THE THREE MONTHS ENDED JUNE 30,
-------------------------------------
2008 2007 % CHANGE
-------------------------------------
Anesthesia $ 20,629 $ 19,876 3.8%
Respiratory/critical care 12,041 11,528 4.5
Sleep/ventilation 17,021 12,929 31.6
Interventional cardiology/radiology 7,604 6,957 9.3
Pharmaceutical technology 3,389 3,117 8.7
-------------------------------------
Net Revenues $ 60,684 $ 54,407 11.5%
=====================================
Anesthesia net revenues increased by 3.8% due primarily to sales of the Company's new products, enFlow(r) and SteeLite(tm), as well as to sales growth of Infusable(r), the Company's patented pressure infusor. Sleep/ventilation net revenues increased by 31.6% due to sales growth in the iSleep 20i(tm) intelligent CPAP and the Vivo(tm) 40 bi-level ventilator as well as from an acquisition at Sleep Services of America.
The table below shows gross profit margins for each of the Company's segments. The total gross profit margin increased to 53.5% in the third quarter of fiscal 2008 from 52.5% in the same quarter in the prior year.
GROSS PROFIT MARGIN BY
BUSINESS SEGMENT
----------------------------
FOR THE THREE MONTHS
ENDED JUNE 30,
----------------------------
2008 2007
----------------------------
Anesthesia 56.2% 52.4%
Respiratory/critical care 57.5 54.6
Sleep/ventilation 50.2 54.0
Interventional cardiology/radiology 54.8 57.9
Pharmaceutical technologies 36.5 27.5
----------------------------
Total gross profit margin 53.5% 52.5%
Net revenues for the first nine months of fiscal 2008 increased by 11.8% to $173,057,000 compared with $154,773,000 in the comparable period last year.
For the nine month period ended June 30, 2008, net income increased by 12.3% to $27,654,000 compared with $24,520,000 for the prior year. Diluted earnings per share increased by 13.0% to $2.08 for the nine-month period ended June 30, 2008 compared with $1.84 for the nine month period ended June 30, 2007.
Following are the net revenues by business segment for the nine months ended June 30, 2008 and 2007.
($ Thousands) NET REVENUES BY BUSINESS SEGMENT
-------------------------------------
FOR THE NINE MONTHS ENDED JUNE 30,
-------------------------------------
2008 2007 % CHANGE
-------------------------------------
Anesthesia $ 59,888 $ 56,453 6.1%
Respiratory/critical care 35,246 34,780 1.3
Sleep/ventilation 48,377 35,354 36.8
Interventional cardiology/radiology 20,440 19,796 3.3
Pharmaceutical technologies 9,106 8,390 8.5
-------------------------------------
Net Revenues $ 173,057 $ 154,773 11.8%
=====================================
Terry Wall, President and CEO of Vital Signs, commented, "I am pleased with the fiscal third quarter sales and earnings performance. Our Anesthesia and Sleep Ventilation segments' sales growth benefited from new product introductions. Two new single-patient-use anesthesia products, the enFlow(r) blood and fluid warmer and SteeLite(tm) laryngoscope blade, introduced at the end of December continue to gain sales momentum. The third quarter performance also reflects our continuing cost-improvement initiatives as the gross profit margin increased by 100 basis points compared with last year."
On July 24, 2008 Vital Signs and General Electric's GE Healthcare unit announced that they entered into a definitive merger agreement for GE to acquire Vital Signs at a price of $74.50 per share. The transaction is subject to customary conditions, including Vital Signs' shareholder approval and regulatory approvals in the United States and other foreign countries. The merger is expected to close in the calendar fourth quarter of 2008. The details of the transaction are included in Vital Signs' Form 8-K and exhibits filed with the SEC on July 24, 2008.
All non-historical statements in this press release, including statements regarding the pending transaction with GE, constitute Forward Looking Statements under the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from such statements as a result of a variety of risks and uncertainties, including the occurrence of any event, change or other circumstance that could give rise to the termination of the merger agreement, the inability to complete the merger due to the failure to obtain shareholder approval or the failure to satisfy other conditions to the completion of the merger, including the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and the failure to receive other required regulatory approvals, general economic conditions, industry specific conditions and the possibility that Vital Signs may be adversely affected by other economic, business, and/or competitive factors, as well as other risks and uncertainties disclosed in Vital Signs' 2007 Annual Report on Form 10-K filed with the SEC.
Vital Signs, Inc. and its subsidiaries design, manufacture, and market primarily single-patient-use medical products for the anesthesia and respiratory/critical care markets. Vital Signs also provides devices and services for the diagnosis and treatment of obstructive sleep apnea. Vital Signs is ISO 13485 certified and has CE Mark approval for its products. In 2007, Forbes Magazine named Vital Signs, Inc. as one of the "200 Best Small Companies in America" based on financial criteria.
IMPORTANT ADDITIONAL INFORMATION AND WHERE TO FIND IT:
In connection with the proposed merger, Vital Signs will file a proxy statement and other relevant materials with the Securities and Exchange Commission (the "SEC"). BEFORE MAKING ANY VOTING DECISION WITH RESPECT TO THE PROPOSED MERGER, INVESTORS AND SHAREHOLDERS ARE ADVISED TO READ THE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED MERGER AND THE PARTIES TO THE MERGER. Investors and shareholders may obtain a free copy of the proxy statement (when available) and other relevant documents filed with the SEC from the SEC's website at www.sec.gov. Vital Signs' shareholders and other interested parties will also be able to obtain, without charge, a copy of the proxy statement and other relevant documents (when available) by directing a request by mail to the company at 20 Campus Road, Totowa, New Jersey, 07512 or by telephone to 973-790-1330. Vital Signs and its directors and officers may be deemed to be participants in the solicitation of proxies from Vital Signs' shareholders with respect to the merger. Information about Vital Signs' directors and officers and their ownership of Vital Signs common stock is set forth in the Vital Signs proxy statements and Annual Reports on Form 10-K previously filed with the SEC, and will be set forth in the proxy statement relating to the proposed merger when it becomes available.
VITAL SIGNS, INC.
INANCIAL HIGHLIGHTS
STATEMENT OF INCOME
-------------------
(In Thousands, Except Per Share Amounts)
--------------------------------------
(Unaudited)
THREE MONTHS ENDED NINE MONTHS ENDED
JUNE 30, JUNE 30,
--------------------- ----------------------
2008 2007 2008 2007
--------------------- ----------------------
Gross revenues $ 79,796 $ 73,046 $ 229,424 $ 210,029
Rebates (18,769) (18,072) (55,351) (52,332)
Other deductions (343) (567) (1,016) (2,924)
---------- ---------- ---------- ----------
Net revenues 60,684 54,407 173,057 154,773
Cost of goods sold and
services provided 28,216 25,818 81,428 74,623
---------- ---------- ---------- ----------
Gross Profit 32,468 28,589 91,629 80,150
Expenses:
Selling, general and
administrative 17,049 14,609 47,627 41,110
Research and
development 2,503 2,053 7,399 5,651
Interest and other
(income)/expense,net (1,783) (1,496) (5,611) (4,209)
---------- ---------- ---------- ----------
Income from continuing
operations
Before income taxes
and minority interest 14,699 13,423 42,214 37,598
Provision for income
taxes 4,892 4,505 14,147 12,270
---------- ---------- ---------- ----------
Income from continuing
operations before
minority interest 9,807 8,918 28,067 25,328
Minority interest 118 277 521 773
---------- ---------- ---------- ----------
Income from continuing
operations 9,689 8,641 27,546 24,555
(Loss) Income from
discontinued operations,
net (4) (16) 108 (35)
Net income $ 9,685 $ 8,625 $ 27,654 $ 24,520
========== ========== ========== ==========
Earnings (loss) per
common share:
Basic:
Income per share
from continuing
operations $ 0.73 $ 0.65 $ 2.07 $ 1.86
Discontinued operations -- -- 0.01 (0.01)
---------- ---------- ---------- ----------
Net earnings $ 0.73 $ 0.65 $ 2.08 $ 1.85
========== ========== ========== ==========
Diluted:
Income per share
from continuing
operations $ 0.73 $ 0.65 $ 2.07 $ 1.85
Discontinued operations -- -- 0.01 (0.01)
---------- ---------- ---------- ----------
Net earnings $ 0.73 $ 0.65 $ 2.08 $ 1.84
========== ========== ========== ==========
Basic weighted average
number of shares 13,294 13,233 13,291 13,223
Diluted weighted average
number of shares 13,313 13,274 13,316 13,272
VITAL SIGNS, INC.
FINANCIAL HIGHLIGHTS
BALANCE SHEET SUMMARY
---------------------
(In thousands of dollars) June September
30, 2008 30, 2007
------------ ------------
Unaudited Audited
Cash and cash equivalents $ 132,080 $ 48,920
Short-term investments -- 86,671
Accounts receivable 40,339 36,915
Inventory 23,254 19,778
Other current assets 7,507 8,982
----- -----
Current assets $ 203,180 $ 201,266
Long-term investments 25,127 --
Other non-current assets 129,670 129,678
------- -------
Total assets $ 357,977 $ 330,944
======= =======
Current liabilities $ 18,215 $ 17,826
Non-current liabilities 2,046 --
----- ------
Total Liabilities $ 20,261 $ 18,312
Non-controlling share in subsidiary 7,228 6,051
Shareholders equity 330,488 306,581
------- -------
Total liabilities and shareholders equity $ 357,977 $ 330,944
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VITL-G