Cutera Reports Record Third Quarter 2016 Results
- Revenue increased 31% year-over-year to
$30.3 million - Revenue achievement represents record third quarter, and second highest quarter in Company’s history
- Ninth consecutive quarter of double-digit revenue growth
- Achieved GAAP profitability and significant operating cash flow
Key operating highlights and financial performance for the third quarter of 2016, when compared to the third quarter of 2015, were as follows:
- Revenue increased 31% to
$30.3 million , due to strong growth in Product revenue inNorth America and Rest of World of 28% and 52%, respectively. - Gross Margin increased to 59%, primarily due to leverage from revenue growth.
- GAAP Net Income increased
$2.6 million from a net loss of$1.0 million a year ago, to a$1.6 million profit. Earnings per diluted share were$0.12 , compared to a loss per share of$0.07 . - Cash generated by operations was
$1.6 million . - Repurchased 176,000 shares of common stock for
$1.9 million from the$10.0 million board-approved stock repurchase program. Remaining balance on the authorized$10.0 million program was$5.1 million . - Cash, cash equivalents and marketable investments were
$46.4 million , and no debt.
In the third quarter of 2016, the Company’s Product revenue grew substantially in the North American and Rest-of-World regions, as well as across all of the major product platforms, including the newly released products as well as our legacy products.
“We continue to expand the functionality of our enlighten platform. In
Mr. Santilli concluded, “We remain committed to advancing our technologies and to providing our customers with an attractive path for upgrading their current systems to the new capabilities. We are well positioned to achieve continued year-over-year profitable growth in the fourth quarter as we continue to execute on the various initiatives for expanding our market share in the growing aesthetic medical equipment market.”
Conference Call
The conference call to discuss these results is scheduled to begin at
About
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, INC. | ||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||
(in thousands, except per share data) | ||||||||||||||
(unaudited) | ||||||||||||||
Three Months Ended | ||||||||||||||
September 30, | September 30, | |||||||||||||
2016 | 2015 | |||||||||||||
Net revenue | $ | 30,281 | $ | 23,085 | ||||||||||
Cost of revenue | 12,538 | 9,594 | ||||||||||||
Gross profit | 17,743 | 13,491 | ||||||||||||
Gross margin % | 59 | % | 58 | % | ||||||||||
Operating expenses: | ||||||||||||||
Sales and marketing | 10,574 | 8,790 | ||||||||||||
Research and development | 2,914 | 2,748 | ||||||||||||
General and administrative | 2,716 | 2,937 | ||||||||||||
Total operating expenses | 16,204 | 14,475 | ||||||||||||
Income (Loss) from operations | 1,539 | (984 | ) | |||||||||||
Interest and other income, net | 166 | 84 | ||||||||||||
Income (Loss) before income taxes | 1,705 | (900 | ) | |||||||||||
Provision for income taxes | 61 | 57 | ||||||||||||
Net income (loss) | $ | 1,644 | $ | (957 | ) | |||||||||
Net income (loss) per share: | ||||||||||||||
Basic | $ | 0.12 | $ | (0.07 | ) | |||||||||
Diluted | $ | 0.12 | $ | (0.07 | ) | |||||||||
Weighted-average number of shares used in per share calculations: | ||||||||||||||
Basic and diluted | 13,163 | 13,827 | ||||||||||||
Diluted | 13,544 | 13,827 | ||||||||||||
CUTERA, INC. | ||||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||||||
(in thousands) | ||||||||||||||
(unaudited) | ||||||||||||||
September 30, | June 30, | September 30, | ||||||||||||
2016 | 2016 | 2015 | ||||||||||||
Assets | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | $ | 11,275 | $ | 7,420 | $ | 10,055 | ||||||||
Marketable investments | 35,108 | 35,902 | 37,689 | |||||||||||
Cash, cash equivalents and marketable investments | 46,383 | 43,322 | 47,744 | |||||||||||
Accounts receivable, net | 11,680 | 11,181 | 9,013 | |||||||||||
Inventories | 16,478 | 14,702 | 13,479 | |||||||||||
Deferred tax asset | - | - | 69 | |||||||||||
Other current assets and prepaid expenses | 2,507 | 2,619 | 1,977 | |||||||||||
Total current assets | 77,048 | 71,824 | 72,282 | |||||||||||
Property and equipment, net | 1,720 | 1,577 | 1,386 | |||||||||||
Deferred tax asset, net of current portion | 410 | 401 | 291 | |||||||||||
Intangibles, net | 16 | 44 | 227 | |||||||||||
Goodwill | 1,339 | 1,339 | 1,339 | |||||||||||
Other long-term assets | 444 | 448 | 392 | |||||||||||
Total assets | $ | 80,977 | $ | 75,633 | $ | 75,917 | ||||||||
Liabilities and Stockholders' Equity | ||||||||||||||
Current liabilities: | ||||||||||||||
Accounts payable | $ | 3,283 | $ | 2,752 | $ | 2,659 | ||||||||
Accrued liabilities | 14,786 | 13,201 | 12,234 | |||||||||||
Deferred revenue | 8,312 | 8,919 | 8,470 | |||||||||||
Total current liabilities | 26,381 | 24,872 | 23,363 | |||||||||||
Deferred revenue, net of current portion | 1,426 | 1,685 | 2,495 | |||||||||||
Income tax liability | 164 | 157 | 187 | |||||||||||
Other long-term liabilities | 597 | 587 | 538 | |||||||||||
Total liabilities | 28,568 | 27,301 | 26,583 | |||||||||||
Stockholders' equity | 52,409 | 48,332 | 49,334 | |||||||||||
Total liabilities and stockholders' equity | $ | 80,977 | $ | 75,633 | $ | 75,917 | ||||||||
CUTERA, INC. | |||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||
(in thousands) | |||||||||||||
(unaudited) | |||||||||||||
Three Months Ended | |||||||||||||
September 30, | September 30, | ||||||||||||
2016 | 2015 | ||||||||||||
Cash flows from operating activities: | |||||||||||||
Net income (loss) | $ | 1,644 | $ | (957 | ) | ||||||||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||||||||||||
Stock-based compensation | 570 | 1,044 | |||||||||||
Depreciation and amortization | 249 | 290 | |||||||||||
Other | 18 | (32 | ) | ||||||||||
Changes in assets and liabilities: | |||||||||||||
Accounts receivable | (525 | ) | (94 | ) | |||||||||
Inventories | (1,776 | ) | 42 | ||||||||||
Accounts payable | 531 | (938 | ) | ||||||||||
Accrued liabilities | 1,659 | 1,230 | |||||||||||
Deferred revenue | (866 | ) | (801 | ) | |||||||||
Other | 99 | (398 | ) | ||||||||||
Net cash provided by (used in) operating activities | 1,603 | (614 | ) | ||||||||||
Cash flows from investing activities: | |||||||||||||
Acquisition of property, equipment and software | (174 | ) | (25 | ) | |||||||||
Disposal of property and equipment | 11 | - | |||||||||||
Net change in marketable investments | 711 | 16,941 | |||||||||||
Net cash provided by investing activities | 548 | 16,916 | |||||||||||
Cash flows from financing activities: | |||||||||||||
Repurchases of common stock | (2,008 | ) | (18,872 | ) | |||||||||
Proceeds from exercise of stock options and employee stock purchase plan | 3,803 | 1,046 | |||||||||||
Payments on capital lease obligations | (91 | ) | (48 | ) | |||||||||
Net cash provided by (used in) financing activities | 1,704 | (17,874 | ) | ||||||||||
Net increase (decrease) in cash and cash equivalents | 3,855 | (1,572 | ) | ||||||||||
Cash and cash equivalents at beginning of period | 7,420 | 11,627 | |||||||||||
Cash and cash equivalents at end of period | $ | 11,275 | $ | 10,055 | |||||||||
CUTERA, INC. | |||||||||||||||||||
CONSOLIDATED FINANCIAL HIGHLIGHTS | |||||||||||||||||||
(in thousands, except percentage data) | |||||||||||||||||||
(unaudited) | |||||||||||||||||||
Three Months Ended | % Change | ||||||||||||||||||
Q3 | Q3 | Q3 '16 Vs | |||||||||||||||||
2016 | 2015 | Q3 '15 | |||||||||||||||||
Revenue By Geography: | |||||||||||||||||||
United States | $ | 15,356 | $ | 13,206 | +16 | % | |||||||||||||
International | 14,925 | 9,879 | +51 | % | |||||||||||||||
$ | 30,281 | $ | 23,085 | +31 | % | ||||||||||||||
International as a percentage of total revenue | 49 | % | 43 | % | |||||||||||||||
Revenue By Product Category: | |||||||||||||||||||
Products | |||||||||||||||||||
-North America | $ | 13,896 | $ | 10,830 | +28 | % | |||||||||||||
-Rest of the World | 9,983 | 6,562 | +52 | % | |||||||||||||||
Total Products | 23,879 | 17,392 | +37 | % | |||||||||||||||
Service | 4,788 | 4,288 | +12 | % | |||||||||||||||
Hand Piece Refills | 602 | 671 | -10 | % | |||||||||||||||
Skincare | 1,012 | 734 | +38 | % | |||||||||||||||
$ | 30,281 | $ | 23,085 | +31 | % | ||||||||||||||
Three Months Ended | |||||||||||||||||||
Q3 | Q3 | ||||||||||||||||||
2016 | 2015 | ||||||||||||||||||
Pre-tax Stock-Based Compensation Expense: | |||||||||||||||||||
Cost of revenue | $ | 73 | $ | 112 | |||||||||||||||
Sales and marketing | 239 | 311 | |||||||||||||||||
Research and development | 131 | 148 | |||||||||||||||||
General and administrative | 127 | 473 | |||||||||||||||||
$ | 570 | $ | 1,044 | ||||||||||||||||
CONTACTS:Cutera, Inc. Ron Santilli Interim Chief Executive Officer and Chief Financial Officer 415-657-5500 Investor RelationsJohn Mills ICR, Inc. 646-277-1254 john.mills@icrinc.com