- MRI Magnet, Medical Device Sales Remain Strong LATHAM, N.Y., Jan.
3 /PRNewswire-FirstCall/ -- Intermagnetics General Corporation
(NASDAQ:IMGC) today reported that second-quarter normalized net
income from operations increased 25 percent to $8.5 million, or
$0.30 per diluted share, from $6.8 million, or $0.24 per diluted
share, a year earlier. Reported net income increased to $6.8
million, or $0.24 per diluted share, from $4.1 million or $0.15 per
diluted share. Revenues for the quarter ended November 27, 2005,
climbed about 18 percent to $78.1 million from $66.2 million. For
the first six months of fiscal 2006, normalized net income rose to
$14.5 million, or $0.51 per diluted share, from the prior-year
period's $11.2 million, or $0.40 per diluted share. Reported
six-month net income was $11.9 million, or $0.42 per diluted share,
compared with $9.4 million, or $0.34 per diluted share. Revenue
increased to $149.1 million from $117.7 million. "Our operating
segments continued to deliver strong performance during the second
quarter," said Glenn H. Epstein, chairman and chief executive
officer. "Our technology and product leadership within the overall
MRI market remains the cornerstone of our ongoing business, and we
believe we remain on target to meet our previously forecasted sales
growth of greater than 15 percent, with earnings increasing more
than 20 percent compared with normalized continuing operations last
fiscal year." Conference Call Tomorrow The company will discuss its
second-quarter results, as well as other developments during a
conference call Wednesday, January 4, 2006, beginning at 11 a.m.
EST. The call will be broadcast live and archived over the Internet
through the company's website http://www.intermagnetics.com/ under
the Investor Relations section. The domestic dial-in number for the
live call is 877-407-8037. The international dial-in number is
201-689-8037. No conference code is required for the live call. The
company will also make available a digital replay beginning 2 p.m.
EST January 4, 2006, through 11:59 p.m. January 16, 2006, by
dialing 201-612-7415-account number 249. Callers should select
conference number 181831. Intermagnetics
(http://www.intermagnetics.com/) draws on the financial strength,
operational excellence and technical leadership in the market of
Magnetic Resonance Imaging (MRI) as well as its expanding
businesses within Medical Devices that encompass Invivo Diagnostic
Imaging (focusing on MRI components & imaging sub-systems) and
Invivo Patient Care (focusing on monitoring & other patient
care devices). Intermagnetics is also a prominent participant in
superconducting applications for Energy Technology. The company has
a more than 30-year history as a successful developer, manufacturer
and marketer of superconducting materials, high-field magnets,
medical systems & components and other specialized high-value
added devices. Safe Harbor Statement: The statements contained in
this press release that are not historical fact are
"forward-looking statements" which involve various important
assumptions, risks, uncertainties and other factors. These forward-
looking statements are based on currently available competitive,
financial and economic data and management's views and assumptions
regarding future events. Such forward-looking statements are
inherently uncertain and are subject to risks, including but not
limited to: the company's ability to meet the performance, quality
and price requirements of our customers, develop new products and
maintain gross margin levels through continued production cost
reductions and manufacturing efficiencies; the ability of the
company's largest customer to maintain and grow its share of the
market for MRI systems; the company's ability to invest sufficient
resources in and obtain third-party funding for its HTS development
efforts and avoid the potential adverse impact of competitive
emerging patents; as well as other risks and uncertainties set
forth herein and in the company's Annual Report on Forms 10-K and
10-Q. The company has provided supplemental non-GAAP financial
tables to provide shareholders and prospective shareholders
additional information to understand the company's normalized
quarterly operations. These tables contain certain estimated
pro-forma calculations that we believe provide helpful information
regarding our operations. Except for the company's continuing
obligation to disclose material information under federal
securities law, the company is not obligated to update its
forward-looking statements even though situations may change in the
future. The company qualifies all of its forward-looking statements
by these cautionary statements. INTERMAGNETICS GENERAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS (Dollars in Thousands, Except
Per Share Amounts) (Unaudited) Three Months Ended Six Months Ended
November 27, November 28, November 27, November 28, 2005 2004 2005
2004 Revenues $78,112 $66,175 $149,128 $117,699 Cost of revenues
42,952 34,946 82,822 63,354 Gross margin 35,160 31,229 66,306
54,345 Product research and development 7,635 6,188 14,971 11,147
Selling, general and administrative: Stock based compensation 3,153
3,441 5,229 4,568 Other selling, general and administrative 13,433
14,807 26,140 25,487 Amortization of intangible assets 1,267 1,673
2,664 3,057 Impairment of intangible assets 913 913 25,488 27,022
49,004 45,172 Operating income 9,672 4,207 17,302 9,173 Interest
and other income 1,033 211 1,187 412 Interest and other expense
(945) (1,117) (1,591) (2,129) Gain on litigation settlement 600
Adjustment to gain on prior period sale of division 648 648 1,094
Income from continuing operations before income taxes 10,408 3,301
18,146 8,550 Provision for income taxes 3,570 934 6,224 2,756
INCOME FROM CONTINUING OPERATIONS 6,838 2,367 11,922 5,794
Discontinued operations: Income from operations of discontinued
subsidiary 2,708 5,594 Provision for income taxes 941 1,942 INCOME
FROM DISCONTINUED OPERATIONS - 1,767 - 3,652 NET INCOME $6,838
$4,134 $11,922 $9,446 Basic Net Income per Common Share: Continuing
operations $0.24 $0.09 $0.42 $0.22 Discontinued operations 0.06
$0.13 Basic Net Income per Common Share $0.24 $0.15 $0.42 $0.35
Diluted Net Income per Common Share: Continuing operations $0.24
$0.09 $0.42 $0.21 Discontinued operations 0.06 $0.13 Diluted Net
Income per Common Share $0.24 $0.15 $0.42 $0.34 Shares: Basic
28,169,367 27,979,535 28,156,526 27,334,721 Diluted 28,659,027
28,478,513 28,636,899 27,801,185 INTERMAGNETICS GENERAL CORPORATION
RECONCILING STATEMENTS OF OPERATIONS (Dollars in Thousands, Except
Per Share Amounts) (Unaudited) Three Months Ended Six Months Ended
November 27, November 28, November 27, November 28, 2005 2004 2005
2004 Normalized Operations without Acquisition, Integration, Sale
and Non-cash items: Revenues $78,112 $66,175 $149,128 $117,699 Cost
of revenues 42,952 34,873 82,822 63,143 Gross margin 35,160 31,302
66,306 54,556 Product research and development 7,635 6,188 14,971
11,129 Selling, general and administrative 13,433 13,200 26,140
23,518 Amortization of intangible assets 1,267 1,673 2,664 3,057
22,335 21,061 43,775 37,704 Operating income 12,825 10,241 22,531
16,852 Interest and other income 1,033 211 1,187 412 Interest and
other expense (945) (588) (1,591) (1,163) Income from continuing
operations before income taxes 12,913 9,864 22,127 16,101 Provision
for income taxes 4,429 3,048 7,590 4,942 INCOME FROM CONTINUING
OPERATIONS $8,484 $6,816 $14,537 $11,159 Earnings per Common Share:
Basic $0.30 $0.24 $0.52 $0.41 Diluted $0.30 $0.24 $0.51 $0.40
Shares: Basic 28,169,367 27,979,535 28,156,526 27,334,721 Diluted
28,659,027 28,478,513 28,636,899 27,801,185 Three Months Ended Six
Months Ended November 27, November 28, November 27, November 28,
2005 2004 2005 2004 Reconciliation of Financial Statements to GAAP
Equivalent: Pro-forma net income $8,484 $6,816 $14,537 $11,159
Stock based compensation (3,153) (3,441) (5,229) (4,568) Gain on
litigation settlement 600 Acquisition and integration related
charges (1,680) (2,198) Impairment of intangible assets (913) (913)
Interest burden (529) (966) Adjustment to gain on prior period sale
of division 648 648 1,094 Provision for taxes relating to pro-forma
adjustments 859 2,114 1,366 2,186 Income from discontinued
operations 1,767 3,652 As Reported Net Income $6,838 $4,134 $11,922
$9,446 * This table is included to provide shareholders' and
prospective shareholders' additional information to understand the
Company's normalized quarterly and annual performance.
INTERMAGNETICS GENERAL CORPORATION Condensed Consolidated Balance
Sheets (Dollars in Thousands) (Unaudited) November 27, May 29, 2005
2005 ASSETS CURRENT ASSETS Cash and short-term investments $10,054
$6,970 Trade accounts receivable 66,328 60,682 Costs and estimated
earnings in excess of billings on uncompleted contracts 1,823 718
Inventories 56,766 40,265 Prepaid expenses and other 9,163 8,665
TOTAL CURRENT ASSETS 144,134 117,300 PROPERTY, PLANT AND EQUIPMENT,
net 45,186 42,974 GOODWILL, INTANGIBLE AND OTHER ASSETS 229,247
229,374 $418,567 $389,648 LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES Current portion of long-term debt $212 $12,404
Accounts payable 15,309 22,136 Salaries, wages and related items
9,618 11,691 Customer advances and deposits 1,162 1,951 Product
warranty reserve 3,445 4,073 Income tax payable 1,360 3,305 Other
liabilities and accrued expenses 7,763 10,189 TOTAL CURRENT
LIABILITIES 38,869 65,749 LONG-TERM DEBT, less current portion
58,559 19,885 NOTE PAYABLE 5,000 5,000 DEFERRED INCOME TAXES 20,135
19,618 DERIVATIVE LIABILITY 52 DEFERRED COMPENSATION OBLIGATION
8,047 4,338 SHAREHOLDERS' EQUITY 287,957 275,006 $418,567 $389,648
INTERMAGNETICS GENERAL CORPORATION SUMMARY OF PERFORMANCE AGAINST
GOALS Six Months Ended November 27, November 28, 2005 2004 Goal
Gross Margin (1) 44% 46% 45% Operating Income: Percent of Sales (1)
(2) 15% 14% 15% Percent of Net Operating Assets (1) (2) 42% 45% 50%
Return on Equity (1) (2) 10% 9% 15% Working Capital Efficiency
(Working capital, less cash divided by net sales) (1) (2) 20% 14%
15% (1) Based on normalized data; (2) Based on annualized data
SEGMENT DATA Three Months Ended November 27, 2005 Magnetic (Dollars
in Thousands) Resonance Medical Energy Imaging Devices Technology
Total Net revenues to external customers: Magnet systems $34,549
$34,549 Patient Monitors & RF Coils $40,727 40,727 Other $2,836
2,836 Total 34,549 40,727 2,836 78,112 Segment operating income
(loss) 9,154 5,146 (1,475) 12,825 Total assets $137,119 $269,706
$11,742 $418,567 November 28, 2004 Magnetic (Dollars in Thousands)
Resonance Medical Energy Imaging Devices Technology Total Net
revenues to external customers: Magnet systems $29,506 $29,506
Patient Monitors & RF Coils $33,644 33,644 Other $3,025 3,025
Total 29,506 33,644 3,025 66,175 Segment operating income (loss)
6,611 5,375 (1,745) 10,241 Total assets $126,371 $243,019 $11,602
$380,992 Six Months Ended November 27, 2005 Magnetic Resonance
Medical Energy Imaging Devices Technology Total Net revenues to
external customers: Magnet systems $62,664 $62,664 Patient Monitors
& RF Coils $80,593 80,593 Other $5,871 5,871 Total 62,664
80,593 5,871 149,128 Segment operating income (loss) 15,958 9,793
(3,220) 22,531 Total assets $137,119 $269,706 $11,742 $418,567
November 28, 2004 Magnetic Resonance Medical Energy Imaging Devices
Technology Total Net revenues to external customers: Magnet systems
$53,608 $53,608 Patient Monitors & RF Coils $59,516 59,516
Other $4,575 4,575 Total 53,608 59,516 4,575 117,699 Segment
operating income (loss) 10,973 9,726 (3,847) 16,852 Total assets
$126,371 $243,019 $11,602 $380,992 Three Months Ended November 27,
November 28, 2005 2004 Reconciliation of income before income
taxes: Operating income from reportable segments $12,825 $10,241
Non-cash stock based compensation (3,153) (3,441) Acquisition and
integration related items (1,680) Impairment of intangible assets
(913) Net Operating Profit 9,672 4,207 Interest and other income
1,033 211 Interest and other expense (945) (1,117) Adjustment to
gain on prior period sale of division 648 Income before income
taxes $10,408 $3,301 Six Months Ended November 27, November 28,
2005 2004 Reconciliation of income before income taxes: Operating
income from reportable segments $22,531 $16,852 Non-cash stock
based compensation (5,229) (4,568) Acquisition and integration
related items (2,198) Impairment of intangible assets (913) Net
Operating Profit 17,302 9,173 Interest and other income 1,187 412
Interest and other expense (1,591) (2,129) Gain on litigation
settlement 600 Adjustment to gain on prior period sale of division
648 1,094 Income before income taxes $18,146 $8,550 Reconciliation
of Metrics to GAAP Equivalent: Six Months Ended November 27, 2005
Operating Income as a Gross Percent of Return on Margin Sales
Equity As Reported GAAP Equivalent 44% 11% 8% Effect of non-cash
related charges and non-recurring gains 4% 2% Effect of averaging
Pro-forma metrics 44% 15% 10% Six Months Ended November 28, 2004
Operating Income as a Gross Percent of Return on Margin Sales
Equity As Reported GAAP Equivalent 46% 8% 8% Impact of excluding
Polycold (3%) Effect of acquisition, integration, non-cash related
charges and other non-recurring charges and credits 6% 4% Effect of
averaging Pro-forma metrics 46% 14% 9% DATASOURCE: Intermagnetics
General Corporation CONTACT: Michael Burke, Exec. VP & CFO, or
Cathy Yudzevich, IR Manager, both of Intermagnetics General
Corporation, +1-518-782-1122 Web site:
http://www.intermagnetics.com/
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