BRISBANE, Calif., May 3, 2010 (GLOBE NEWSWIRE) -- Cutera, Inc. (Nasdaq:CUTR), a leading provider of laser and other energy-based aesthetic systems for practitioners worldwide, today reported financial results for the first quarter ended March 31, 2010.
First quarter 2010 revenue was $13.7 million, compared to $14.4 million in the same period last year. Net loss for the first quarter of 2010 was $2.0 million, or $0.15 per diluted share.
Kevin Connors, President and CEO of Cutera, stated, "Historically, our first quarter revenue is seasonally the lowest compared to the other quarters during a fiscal year. During the first quarter of 2010, our international revenue increased 14%, compared to the first quarter of 2009, however, our US revenue decreased on a year-over-year basis. Even though several industry reports indicate that our customers continue to experience strong patient demand from our products, the U.S. market continues to remain challenging as many of our prospective customers remain reluctant to purchase capital equipment."
"Our sales and marketing expenses decreased to $6.4 million, or 46% of revenue, compared to $7.0 million, or 49% of revenue, in the first quarter of 2009. This $642,000 improvement was due primarily to our 2009 restructuring efforts. On a sequential basis, our sales and marketing expenses increased $261,000 from the fourth quarter of 2009, due primarily to seasonal expenses associated with our largest trade show of the year and our annual sales meeting. In addition, we added a few new sales and marketing functions in the first quarter of 2010 to increase our focus on revenue growth."
"During the quarter, we made progress in the implementation of our strategic alliances with Obagi Medical Products, Inc. (Nasdaq:OMPI) and Sound Surgical Technologies LLC. We trained our applicable sales and service teams, enhanced our marketing plans, invested in inventories, and established our infrastructure to integrate these exciting new products through the international side of our organization. In February 2010, we commenced shipments of Obagi Medical's physician dispensed cosmeceutical products in Japan and are planning to launch the Vaser ultra-sound assisted liposuction device during the second quarter of this year. We believe these alliances will leverage our distribution network, enhance our product offering and increase revenue in selected international markets."
Mr. Connors added, "We remain focused on key initiatives to increase future revenue levels and leverage our business model, which we expect will result in improved profitability. While the near-term prospects for our industry are difficult to predict, we believe that our worldwide distribution network, strong balance sheet with $103.4 million in cash and investments -- with no debt -- a broad portfolio of products, and various research and development projects underway, offer continuing, long-term opportunities for our company."
Conference Call:
The conference call to discuss these results is scheduled to begin at 2:00 p.m. PT (5:00 p.m. ET) on May 3, 2010. The call will be broadcast live over the Internet hosted at the Investor Relations section of Cutera's website at www.cutera.com, and will be archived online within one hour of its completion through 8:59 p.m. PT (11:59 p.m. ET) on May 17, 2010. In addition, you may call (877) 407-0784 to listen to the live broadcast. Participating in the call will be Kevin Connors, President and Chief Executive Officer, and Ron Santilli, Executive Vice President and Chief Financial Officer.
About Cutera, Inc.
Brisbane, California-based Cutera is a leading provider of laser and other energy-based aesthetic systems for practitioners worldwide. Since 1998, Cutera has been developing innovative, easy-to-use products that enable physicians and other qualified practitioners to offer safe and effective aesthetic treatments to their patients. For more information, call 1-888-4CUTERA or visit www.cutera.com.
This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Specifically, statements concerning Cutera's ability to leverage its business model, increase revenue, manage costs and expenses, generate additional cash, increase profitability, develop and commercialize existing and new products and applications, and statements regarding long-term prospects and opportunities are forward-looking statements within the meaning of the Safe Harbor. Forward-looking statements are based on management's current, preliminary expectations and are subject to risks and uncertainties, which may cause Cutera's actual results to differ materially from the statements contained herein. Potential risks and uncertainties that could affect Cutera's business and cause its financial results to differ materially from those contained in the forward-looking statements include the current economic uncertainty, which may reduce consumer demand for its products, cause potential customers to delay their purchase decisions and make it more difficult for some potential customers to obtain credit financing; its ability to increase revenue, manage costs and expenses and improve sales productivity and performance worldwide; its ability to successfully develop and acquire new products and applications and market them to both its installed base and new customers; the length of the sales cycle process; unforeseen events and circumstances relating to its operations; government regulatory actions; and those other factors described in the section entitled, "Risk Factors," in its most recent Form 10-Q as filed with the Securities and Exchange Commission on May 3, 2010. Undue reliance should not be placed on forward-looking statements, which speak only as of the date they are made. Cutera undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date they were made, or to reflect the occurrence of unanticipated events. Cutera's first quarter ended March 31, 2010 financial performance, as discussed in this release, is preliminary and unaudited, and subject to adjustment.
| CUTERA, INC. | |||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||
| (in thousands) | |||
| (unaudited) | |||
|
March 31, 2010 |
December 31, 2009 |
March 31, 2009 |
|
| Assets | |||
| Current assets: | |||
| Cash and cash equivalents | $ 22,519 | $ 22,829 | $ 35,793 |
| Marketable investments | 73,733 | 76,780 | 58,131 |
| Accounts receivable, net | 3,488 | 3,327 | 5,262 |
| Inventories | 6,953 | 6,408 | 9,846 |
| Deferred tax asset | 178 | 175 | 4,652 |
| Other current assets and prepaid expenses | 3,190 | 2,785 | 2,997 |
| Total current assets | 110,061 | 112,304 | 116,681 |
| Property and equipment, net | 796 | 847 | 1,241 |
| Long-term investments | 7,153 | 7,275 | 9,463 |
| Intangibles, net | 781 | 829 | 975 |
| Deferred tax asset, net of current portion | 97 | 97 | 6,312 |
| Total assets | $ 118,888 | $ 121,352 | $ 134,672 |
| Liabilities and Stockholders' Equity | |||
| Current liabilities: | |||
| Accounts payable | $ 1,898 | 1,081 | 1,535 |
| Accrued liabilities | 7,328 | 9,048 | 8,166 |
| Deferred revenue | 6,270 | 6,160 | 6,596 |
| Total current liabilities | 15,496 | 16,289 | 16,297 |
| Deferred rent | 1,398 | 1,493 | 1,658 |
| Deferred revenue, net of current portion | 1,594 | 1,968 | 4,001 |
| Income tax liability | 729 | 749 | 1,421 |
| Total liabilities | 19,217 | 20,499 | 23,377 |
| Stockholders' equity: | |||
| Common stock | 13 | 13 | 13 |
| Additional paid-in capital | 86,150 | 85,248 | 81,450 |
| Retained earnings | 15,236 | 17,254 | 29,582 |
| Accumulated other comprehensive income (loss) | (1,728) | (1,662) | 250 |
| Total stockholders' equity | 99,671 | 100,853 | 111,295 |
| Total liabilities and stockholders' equity | $ 118,888 | $ 121,352 | $ 134,672 |
|
CUTERA, INC. |
|||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||
| (in thousands, except per share data) | |||
| (unaudited) | |||
| Three Months Ended | |||
|
March 31, 2010 |
December 31, 2009 |
March 31, 2009 |
|
| Net revenue | $ 13,749 | $ 15,416 | $ 14,430 |
| Cost of revenue | 5,829 | 5,783 | 5,936 |
| Gross profit | 7,920 | 9,633 | 8,494 |
| Operating expenses: | |||
| Sales and marketing | 6,361 | 6,100 | 7,003 |
| Research and development | 1,454 | 1,888 | 1,743 |
| General and administrative | 2,242 | 2,063 | 2,520 |
| Litigation settlement | -- | -- | 850 |
| Total operating expenses | 10,057 | 10,051 | 12,116 |
| Loss from operations | (2,137) | (418) | (3,622) |
| Interest and other income, net | 166 | 174 | 599 |
| Loss before income taxes | (1,971) | (244) | (3,023) |
| Provision (benefit) for income taxes | 47 | (251) | (1,195) |
| Net income (loss) | $ (2,018) | $ 7 | $ (1,828) |
| Net income (loss) per share: | |||
| Basic | $ (0.15) | $ 0.00 | $ (0.14) |
| Diluted | $ (0.15) | $ 0.00 | $ (0.14) |
| Weighted-average number of shares used in per share calculations: | |||
| Basic | 13,438 | 13,427 | 13,120 |
| Diluted | 13,438 | 13,610 | 13,120 |
|
CUTERA, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||
| (in thousands) | |||
| (unaudited) | |||
| Three Months Ended | |||
| March 31, 2010 | December 31, 2009 | March 31, 2009 | |
| Cash flows from operating activities: | |||
| Net income (loss) | $ (2,018) | $ 7 | $ (1,828) |
| Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
| Stock-based compensation | 828 | 840 | 1,045 |
| Tax benefit from stock-based compensation | -- | 111 | (26) |
| Excess tax deficit related to stock-based compensation | -- | (23) | -- |
| Depreciation and amortization | 194 | 196 | 228 |
| Provision for excess and obsolete inventories | (23) | 363 | 373 |
| Provision for doubtful accounts receivable | (82) | (25) | 55 |
| Change in deferred tax asset and deferred tax liability | (3) | (28) | (105) |
| Changes in assets and liabilities: | |||
| Accounts receivable | (79) | (667) | 475 |
| Inventories | (522) | 1,113 | (292) |
| Other current assets and prepaid expenses | 295 | 339 | (914) |
| Accounts payable | 817 | (131) | (155) |
| Accrued liabilities | (1,760) | 1,767 | (682) |
| Deferred rent | (55) | (55) | (55) |
| Deferred revenue | (264) | (498) | (1,068) |
| Income tax liability | (20) | (133) | (31) |
| Net cash provided by (used in) operating activities | (2,692) | 3,176 | (2,980) |
| Cash flows from investing activities: | |||
| Acquisition of property and equipment | (95) | (56) | (62) |
| Proceeds from sales of marketable and long-term investments | 14,990 | 7,120 | 6,578 |
| Proceeds from maturities of marketable investments | 14,125 | 975 | 1,145 |
| Purchase of marketable and long-term investments | (26,712) | (22,860) | (5,542) |
| Net cash (used in) provided by investing activities | 2,308 | (14,821) | 2,119 |
| Cash flows from financing activities: | |||
| Proceeds from exercise of stock options and employee stock purchase plan | 74 | 149 | 114 |
| Excess tax benefit related to stock-based compensation | -- | 23 | -- |
| Net cash provided by financing activities | 74 | 172 | 114 |
| Net increase (decrease) in cash and cash equivalents | (310) | (11,473) | (747) |
| Cash and cash equivalents at beginning of period | 22,829 | 34,302 | 36,540 |
| Cash and cash equivalents at end of period | $ 22,519 | $ 22,829 | $ 35,793 |
|
CUTERA, INC. |
||||||
| CONSOLIDATED REVENUE HIGHLIGHTS | ||||||
| (in thousands, except percentage data) | ||||||
| (unaudited) | ||||||
| Three Months Ended | ||||||
|
March 31, 2010 |
% of Revenue |
December 31, 2009 |
% of Revenue |
March 31, 2009 |
% of Revenue |
|
| Revenue By Geography: | ||||||
| United States | $ 4,547 | 33% | $ 5,298 | 34% | $ 6,345 | 44% |
| International | 9,202 | 67% | 10,118 | 66% | 8,085 | 56% |
| $ 13,749 | $ 15,416 | $ 14,430 | ||||
| Revenue By Product Category: | ||||||
| Products | $ 7,445 | 54% | $ 8,083 | 52% | $ 7,652 | 53% |
| Product upgrades | 1,203 | 9% | 2,036 | 13% | 1,754 | 12% |
| Service | 3,314 | 24% | 3,327 | 22% | 3,253 | 23% |
| Titan refills | 1,322 | 10% | 1,524 | 10% | 1,385 | 10% |
| Dermal fillers and cosmeceuticals | 465 | 3% | 446 | 3% | 386 | 2% |
| $ 13,749 | $ 15,416 | $ 14,430 | ||||