WESTFORD, Mass., April 29 /PRNewswire-FirstCall/ -- Cynosure, Inc. (Nasdaq: CYNO), a leading developer and manufacturer of a broad array of light-based aesthetic treatment systems, today announced record revenues and gross margin for the quarter ended March 31, 2008.
First-Quarter 2008 Financial Results
Revenues increased approximately 41% to a record $36.8 million in the first quarter of 2008 from $26.1 million in the first quarter of 2007. Gross profit margin increased to 66.3% of total revenues compared with 62.0% for the same period in 2007. Net income in the first quarter of 2008 increased approximately 130% to $4.9 million, or $0.38 per diluted share, compared with net income of $2.1 million, or $0.17 per diluted share, in the first quarter of 2007.
Non-GAAP net income, which excludes stock-based compensation expense and its related income tax effects, was $5.7 million, or $0.45 per diluted share, in the first quarter of 2008, compared with non-GAAP net income of $3.1 million, or $0.25 per diluted share, in the first quarter of 2007. Please refer to the financial reconciliations included in this news release for a reconciliation of GAAP results to non-GAAP results for the three month periods ended March 31, 2008 and 2007.
"We produced another excellent quarter, as our flagship solutions for laser lipolysis, anti-aging and hair removal all posted double-digit percentage revenue gains," said Cynosure President and Chief Executive Officer Michael Davin. "Laser product revenue rose 43% in the first quarter of 2008 from the same period last year, reflecting demand for our Smartlipo LaserBodySculpting and Affirm Anti-Aging workstations as well as our Elite Aesthetic workstation for hair removal. Average selling prices remained strong and we continued to achieve manufacturing efficiencies. As a result, our first-quarter gross margin improved 430 basis points to a record 66.3% and we more than doubled our net income over the prior-year period."
"We achieved a number of financial milestones in the first quarter of 2008, including our 10th consecutive quarter of revenue growth, our sixth consecutive quarter of profitability and our fifth consecutive quarter of positive cash flow from operations," Davin said. "Even in a challenging macroeconomic environment, we have delivered outstanding results based on our unwavering commitment to having the best technology, products and distribution in the industry. Looking ahead, we believe our customers remain positive about their purchasing intentions and consumer sentiment."
"Cynosure is off to a great start in 2008, and we will continue to pursue a strategy centered on delivering the best aesthetic technology for broad-based, fast-growing applications," Davin said. "While our overall industry has come under some recent economic pressure, we believe we remain well-positioned for growth with an extensive suite of advanced products, a strong balance sheet, and an efficient operating profile. We expect our continued innovation will help our brand continue to be one of the most sought after in the industry. In addition, the new products we have introduced over the past several years have helped us forge strong alliances with traditional and non-traditional customers. Our aim is that these relationships, and our outstanding reputation in the industry, will prove invaluable as we continue to launch products, both in the U.S. and abroad."
Use of Non-GAAP Financial Measures
To supplement Cynosure's consolidated financial statements presented in accordance with GAAP, this press release includes the following measures defined as non-GAAP financial measures by the SEC: non-GAAP net income and non-GAAP diluted earnings per share. The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. In addition, the non-GAAP financial measures included in this press release may be different from, and therefore not comparable to, similar measures used by other companies. Although certain non-GAAP financial measures used in this release exclude the accounting treatment of stock-based compensation, these non-GAAP measures should not be relied upon independently, as they ignore the contribution to our operating results that is generated by the incentive and compensation effects of the underlying stock-based compensation programs. For more information on these non-GAAP financial measures, please see the non-GAAP data included at the end of this release. This data has more details of the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures.
Cynosure's management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenses and expenditures that may not be indicative of our core business operating results. Cynosure believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing Cynosure's performance and when planning, forecasting and analyzing future periods. These non-GAAP financial measures also facilitate management's internal comparisons to Cynosure's historical performance and our competitors' operating results. Cynosure believes that these non-GAAP measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making.
Cynosure will host a conference call for investors today at 9:00 a.m. ET. On the call, Michael Davin and Timothy Baker, the company's Executive Vice President and Chief Financial Officer, will discuss the first quarter 2008 financial results, provide a business update and discuss the company's growth strategy.
Those who wish to listen to the conference call webcast should visit the "Investor Relations" section of the company's website at http://www.cynosure.com. The live call also can be accessed by dialing (877) 407-5790 or (201) 689-8328. If you are unable to listen to the live call, the webcast will be archived on the company's website.
About Cynosure, Inc.
Cynosure, Inc. develops and markets aesthetic treatment systems that are used by physicians and other practitioners to perform non-invasive and minimally invasive procedures to remove hair, treat vascular lesions, rejuvenate skin through the treatment of shallow vascular and pigmented lesions, laser lipolysis and temporarily reduce the appearance of cellulite. Cynosure's products include a broad range of laser and other light-based energy sources, including Alexandrite, pulsed dye, Nd:YAG and diode lasers, as well as intense pulsed light. Cynosure was founded in 1991.
For corporate or product information, contact Cynosure at 800-886-2966, or visit http://www.cynosure.com.
Any statements in this press release about future expectations, plans and prospects for Cynosure, Inc., including statements about the company's expectations and future financial performance, as well as other statements containing the words "believes," "anticipates," "plans," "expects," "will" and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including Cynosure's history of operating losses, its reliance on sole source suppliers, the inability to accurately predict the timing or outcome of regulatory decisions, changes in consumer preferences, competition in the aesthetic laser industry, economic, market, technological and other factors discussed in Cynosure's most recent Annual Report on Form 10-K, which is filed with the Securities and Exchange Commission. In addition, the forward-looking statements included in this press release represent Cynosure's views as of the date of this press release. Cynosure anticipates that subsequent events and developments will cause its views to change. However, while Cynosure may elect to update these forward- looking statements at some point in the future, it specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing Cynosure's views as of any date subsequent to the date of this press release.
SOURCE Cynosure, Inc.