UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of
the
Securities Exchange Act of 1934
May 3,
2010
Date of
Report (date of earliest event reported)
Cutera,
Inc.
(Exact
name of Registrant as specified in its charter)
|
Delaware
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000-50644
|
77-0492262
|
||
|
(State
or other jurisdiction of
incorporation
or organization)
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(Commission
File Number)
|
(I.R.S.
Employer
Identification
Number)
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3240
Bayshore Blvd.
Brisbane,
California 94005
(Address
of principal executive offices)
(415)
657-5500
(Registrant’s
telephone number, including area code)
N/A
(Former
name or former address, if changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
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¨
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|
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¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
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¨
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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¨
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item 2.02.
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Results
of Operations and Financial
Condition.
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On May 3,
2010, we are issuing a press release and holding a conference call regarding our
financial results for the first quarter ended March 31, 2010. A copy of the
press release is furnished as Exhibit 99.1 to this Form 8-K.
This
information shall not be deemed “filed” for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), or
incorporated by reference in any filing under the Securities Act of 1933, as
amended, or the Exchange Act, except as shall be expressly set forth by specific
reference in such a filing.
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Item 9.01.
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Financial
Statements and Exhibits.
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(d)
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Exhibits.
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Exhibit No.
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Description
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99.1
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Press
Release of Cutera, Inc. dated as of May 3,
2010.
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
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CUTERA,
INC.
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||||
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Date:
May 3, 2010
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/s/
KEVIN P. CONNORS
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|||
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Kevin
P. Connors
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||||
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President
and Chief Executive Officer
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||||
Exhibit 99.1
FOR
IMMEDIATE RELEASE
CONTACTS:
Cutera,
Inc.
Ron
Santilli
Chief
Financial Officer
415-657-5500
Investor
Relations
John
Mills
Integrated
Corporate Relations, Inc.
310-954-1100
john.mills@icrinc.com
Cutera
Reports First Quarter 2010 Results
BRISBANE,
Calif., May 3, 2010 -- 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.
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CUTERA,
INC.
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||||||||||||
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CONDENSED
CONSOLIDATED BALANCE SHEETS
|
||||||||||||
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(in
thousands)
|
||||||||||||
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(unaudited)
|
||||||||||||
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March
31,
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December
31,
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March
31,
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||||||||||
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2010
|
2009
|
2009
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||||||||||
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Assets
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||||||||||||
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Current
assets:
|
||||||||||||
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Cash
and cash equivalents
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$ | 22,519 | $ | 22,829 | $ | 35,793 | ||||||
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Marketable
investments
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73,733 | 76,780 | 58,131 | |||||||||
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Accounts
receivable, net
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3,488 | 3,327 | 5,262 | |||||||||
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Inventories
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6,953 | 6,408 | 9,846 | |||||||||
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Deferred
tax asset
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178 | 175 | 4,652 | |||||||||
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Other
current assets and prepaid expenses
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3,190 | 2,785 | 2,997 | |||||||||
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Total
current assets
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110,061 | 112,304 | 116,681 | |||||||||
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Property
and equipment, net
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796 | 847 | 1,241 | |||||||||
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Long-term
investments
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7,153 | 7,275 | 9,463 | |||||||||
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Intangibles,
net
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781 | 829 | 975 | |||||||||
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Deferred
tax asset, net of current portion
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97 | 97 | 6,312 | |||||||||
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Total
assets
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$ | 118,888 | $ | 121,352 | $ | 134,672 | ||||||
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Liabilities
and Stockholders' Equity
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||||||||||||
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Current
liabilities:
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||||||||||||
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Accounts
payable
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$ | 1,898 | $ | 1,081 | $ | 1,535 | ||||||
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Accrued
liabilities
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7,328 | 9,048 | 8,166 | |||||||||
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Deferred
revenue
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6,270 | 6,160 | 6,596 | |||||||||
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Total
current liabilities
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15,496 | 16,289 | 16,297 | |||||||||
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Deferred
rent
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1,398 | 1,493 | 1,658 | |||||||||
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Deferred
revenue, net of current portion
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1,594 | 1,968 | 4,001 | |||||||||
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Income
tax liability
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729 | 749 | 1,421 | |||||||||
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Total
liabilities
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19,217 | 20,499 | 23,377 | |||||||||
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Stockholders’
equity:
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||||||||||||
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Common
stock
|
13 | 13 | 13 | |||||||||
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Additional
paid-in capital
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86,150 | 85,248 | 81,450 | |||||||||
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Retained
earnings
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15,236 | 17,254 | 29,582 | |||||||||
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Accumulated
other comprehensive income (loss)
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(1,728 | ) | (1,662 | ) | 250 | |||||||
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Total
stockholders’ equity
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99,671 | 100,853 | 111,295 | |||||||||
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Total
liabilities and stockholders’ equity
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$ | 118,888 | $ | 121,352 | $ | 134,672 | ||||||
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CUTERA,
INC.
|
||||||||||||
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CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
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||||||||||||
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(in
thousands, except per share data)
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||||||||||||
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(unaudited)
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||||||||||||
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Three
Months Ended
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||||||||||||
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March
31,
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December
31,
|
March
31,
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||||||||||
|
2010
|
2009
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2009
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||||||||||
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Net
revenue
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$ | 13,749 | $ | 15,416 | $ | 14,430 | ||||||
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Cost
of revenue
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5,829 | 5,783 | 5,936 | |||||||||
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Gross
profit
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7,920 | 9,633 | 8,494 | |||||||||
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Operating
expenses:
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||||||||||||
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Sales
and marketing
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6,361 | 6,100 | 7,003 | |||||||||
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Research
and development
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1,454 | 1,888 | 1,743 | |||||||||
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General
and administrative
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2,242 | 2,063 | 2,520 | |||||||||
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Litigation
settlement
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- | - | 850 | |||||||||
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Total
operating expenses
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10,057 | 10,051 | 12,116 | |||||||||
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Loss
from operations
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(2,137 | ) | (418 | ) | (3,622 | ) | ||||||
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Interest
and other income, net
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166 | 174 | 599 | |||||||||
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Other-than-temporary
impairments on long-term investments
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- | - | - | |||||||||
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Loss
before income taxes
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(1,971 | ) | (244 | ) | (3,023 | ) | ||||||
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Provision
(benefit) for income taxes
|
47 | (251 | ) | (1,195 | ) | |||||||
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Net
income (loss)
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$ | (2,018 | ) | $ | 7 | $ | (1,828 | ) | ||||
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Net
income (loss) per share:
|
||||||||||||
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Basic
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$ | (0.15 | ) | $ | 0.00 | $ | (0.14 | ) | ||||
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Diluted
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$ | (0.15 | ) | $ | 0.00 | $ | (0.14 | ) | ||||
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Weighted-average
number of shares used in per share calculations:
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||||||||||||
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Basic
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13,438 | 13,427 | 13,120 | |||||||||
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Diluted
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13,438 | 13,610 | 13,120 | |||||||||
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CUTERA,
INC.
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||||||||||||
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CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
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||||||||||||
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(in
thousands)
|
||||||||||||
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(unaudited)
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||||||||||||
|
Three
Months Ended
|
||||||||||||
|
March
31,
|
December
31,
|
March
31,
|
||||||||||
|
2010
|
2009
|
2009
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||||||||||
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Cash
flows from operating activities:
|
||||||||||||
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Net
income (loss)
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$ | (2,018 | ) | $ | 7 | $ | (1,828 | ) | ||||
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Adjustments
to reconcile net income (loss) to net cash provided by (used in) operating
activities:
|
||||||||||||
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Stock-based
compensation
|
828 | 840 | 1,045 | |||||||||
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Tax
benefit from stock-based compensation
|
- | 111 | (26 | ) | ||||||||
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Excess
tax deficit related to stock-based compensation
|
- | (23 | ) | - | ||||||||
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Depreciation
and amortization
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194 | 196 | 228 | |||||||||
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Provision
for excess and obsolete inventories
|
(23 | ) | 363 | 373 | ||||||||
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Provision
for doubtful accounts receivable
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(82 | ) | (25 | ) | 55 | |||||||
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Change
in deferred tax asset and deferred tax liability
|
(3 | ) | (28 | ) | (105 | ) | ||||||
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Changes
in assets and liabilities:
|
||||||||||||
|
Accounts
receivable
|
(79 | ) | (667 | ) | 475 | |||||||
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Inventories
|
(522 | ) | 1,113 | (292 | ) | |||||||
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Other
current assets and prepaid expenses
|
295 | 339 | (914 | ) | ||||||||
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Accounts
payable
|
817 | (131 | ) | (155 | ) | |||||||
|
Accrued
liabilities
|
(1,760 | ) | 1,767 | (682 | ) | |||||||
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Deferred
rent
|
(55 | ) | (55 | ) | (55 | ) | ||||||
|
Deferred
revenue
|
(264 | ) | (498 | ) | (1,068 | ) | ||||||
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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 | ) | ||||||
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Proceeds
from sales of marketable and long-term investments
|
14,990 | 7,120 | 6,578 | |||||||||
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Proceeds
from maturities of marketable investments
|
14,125 | 975 | 1,145 | |||||||||
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Purchase
of marketable and long-term investments
|
(26,712 | ) | (22,860 | ) | (5,542 | ) | ||||||
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Net
cash (used in) provided by investing activities
|
2,308 | (14,821 | ) | 2,119 | ||||||||
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Cash
flows from financing activities:
|
||||||||||||
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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 | ) | ||||||
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Cash
and cash equivalents at beginning of period
|
22,829 | 34,302 | 36,540 | |||||||||
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Cash
and cash equivalents at end of period
|
$ | 22,519 | $ | 22,829 | $ | 35,793 | ||||||
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CUTERA,
INC.
|
|||||||||||||||
|
CONSOLIDATED
REVENUE HIGHLIGHTS
|
|||||||||||||||
|
(in
thousands, except percentage data)
|
|||||||||||||||
|
(unaudited)
|
|||||||||||||||
|
Three
Months Ended
|
|||||||||||||||
|
March
31,
|
%
of
|
December
31,
|
%
of
|
March
31,
|
%
of
|
||||||||||
|
|
2010 |
Revenue
|
|
2009
|
Revenue
|
|
2009
|
Revenue
|
|||||||
|
Revenue
By Geography:
|
|||||||||||||||
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United
States
|
$
|
4,547
|
33%
|
$
|
5,298
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34%
|
$
|
6,345
|
44%
|
||||||
|
International
|
9,202
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67%
|
10,118
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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
|
||||||||||