EX-99.1 2 v148388_ex99-1.htm
 
PRESS RELEASE

Investors/Media:
The Ruth Group
Nick Laudico/Jason Rando
646-536-7030/7025
nlaudico@theruthgroup.com
jrando@theruthgroup.com
  
Contact:
Symmetry Medical Inc.
Fred Hite
Senior Vice President
Chief Financial Officer
(574) 371-2218

Symmetry Medical Reports First Quarter 2009 Financial Results

Reaffirms Full Year 2009 Revenue and Increases Low-end of EPS Guidance

First Quarter 2009 Highlights:

 
·
Revenue of $101.4 million, comparable year-over-year and up 6.8% on a constant currency basis
 
·
Gross margin of 24.2%, up 70 basis points year-over-year and up 80 basis points over the fourth quarter of 2008
 
·
Operating income of $11.2 million, up 17.2% year-over-year and up 18.2% over the fourth quarter of 2008
 
·
Net income of $6.8 million or $0.19 per diluted share, compared to $4.0 million or $0.11 per diluted share in the first quarter 2008

WARSAW, Ind., May 7, 2009 - Symmetry Medical Inc. (NYSE: SMA), a leading independent provider of products to the global orthopaedic device industry and other medical markets, announced today first quarter 2009 financial results for the period ended April 4, 2009.

   
First Quarter
    
Vs Prior Quarter
  
(in millions, except share data)
  
2009
    
2008
    
Change
    
1Q'09
    
4Q'08
    
Change
  
Revenue
   $ 101.4     $ 101.9       0 %   $ 101.4     $ 99.7       2 %
Operating Income
     11.2       9.6       17 %     11.2       9.5       18 %
Net Income
     6.8       4.0       73 %     6.8       4.4 *     56 %
EPS
   $ 0.19     $ 0.11       73 %   $ 0.19     $ 0.12 *     62 %
                                                 
Revenue by Product:
                                                
Instruments
   $ 46.5     $ 39.3       18 %   $ 46.5     $ 44.4       5 %
Implants
     29.1       30.3       -4 %     29.1       29.6       -2 %
Cases
     18.5       21.5       -14 %     18.5       18.5       0 %
Other
     7.3       10.8       -32 %     7.3       7.2       1 %
    Total Revenue
   $ 101.4     $ 101.9       0 %   $ 101.4     $ 99.8       2 %

* non-gaap basis, excluding tax benefit of $6.9 million / $0.20 of EPS

 
 
 
 
Symmetry Medical Reports First Quarter 2009 Financial Results
Page 2

Revenue for the first quarter 2009 was $101.4 million, compared to $101.9 million reported in the first quarter 2008. Foreign currency had a $7.4 million unfavorable impact on the first quarter of 2009 compared to the first quarter of 2008. On a constant currency basis, revenue increased 6.8% for the period. First quarter 2009 includes a full quarter results from the Company’s New Bedford, Massachusetts manufacturing facility, which was acquired from DePuy Orthopaedics, Inc. in January 2008. Adjusting for the acquisition and the foreign exchange, revenue grew 4.2%.

Gross profit for the first quarter 2009 was $24.6 million, compared to $24.0 million in the first quarter 2008. Gross margin percentage for the first quarter 2009 was 24.2% compared to gross margin percentage of 23.5% in the same period last year and 23.4% in the fourth quarter 2008.
 
Selling, general and administrative expenses were $13.4 million for the first quarter 2009, a decrease of 7.2% from $14.4 million for the first quarter 2008. The first quarter of 2008 expenses included approximately $2.2 million of  professional fees related to the Sheffield, UK investigation. The Company did not incur further investigation expenses in the first quarter of 2009. Lower expenses were partially offset by an increase in non-cash stock based compensation and increased expenses associated with the addition of the New Bedford facility, which was acquired at the end of January 2008.
 
Operating income for the first quarter 2009 was $11.2 million compared to $9.6 million for the first quarter 2008. Operating margin for the first quarter 2009 was 11.0%, an increase from 9.4% for the first quarter 2008.
 
Net income for the first quarter 2009 was $6.8 million, or $0.19 per diluted share, compared to net income of $4.0 million, or $0.11 per diluted share, for the first quarter of 2008.
 
The weighted average number of diluted shares outstanding during the first quarter of 2009 was 35,380,503.

Brian Moore, President and Chief Executive Officer of Symmetry Medical, stated, “Our first quarter results represent an excellent start for 2009. We remain encouraged by our improved operational performance and efficiencies and continue to expect to reach profitability at our Sheffield facility in the second half of 2009.”

Mr. Moore continued, “Although the overall global economy remains challenging we are encouraged by the performance and strength of our business model. Despite our positive outlook, we will continue to manage operations conservatively, control costs, generate cash and improve efficiencies. Our focus for the remainder of the year is to build on our global presence in the orthopaedic industry and deliver improved results.”

 
 
 
 
Symmetry Medical Reports First Quarter 2009 Financial Results
Page 3
 
Financial Guidance
The following forward-looking estimates regarding 2009 guidance are based on current market conditions and foreign currency comparisons. Actual results may differ materially, and we refer you to forward-looking statements located at the end of the press release.
 
For the full year 2009, the Company is reaffirming its previously stated annual revenue guidance to be in the range of $405 million to $420 million. On a constant currency basis, the Company expects revenue to increase 2%-6% for the full year. For the full year 2009, the Company is increasing the low-end of earnings per diluted share guidance from $0.75 to $0.77 and reaffirming the high-end guidance of $0.85.
 
The Company continues to expect the Sheffield, UK operating unit to report smaller net operating losses during the second quarter 2009 and operating profitability in the second half of 2009.
 
Conference Call
Symmetry Medical will host a conference call at 8:00 a.m. ET on May 7, 2009. A live webcast of the conference call will be available online from the investor relations page of the Company’s corporate web site at www.symmetrymedical.com. The dial-in numbers are (800) 706-7745 for domestic callers and (617) 614-3472 for international. The reservation number for both is 96482121. After the live webcast, the call will remain available on Symmetry Medical’s web site through July 7, 2009. In addition, a telephonic replay of the call will be available until May 14, 2009. The replay numbers are (888) 286-8010 for domestic callers and (617) 801-6888 for international callers. Please use reservation code 90966491.

About Symmetry Medical Inc.
Symmetry Medical Inc. is a leading independent provider of implants and related instruments and cases to the orthopaedic device industry. The Company also designs, develops and produces these products for companies in other segments of the medical device market, including arthroscopy, dental, laparoscopy, osteobiologic and endoscopy sectors and provides limited specialized products and services to non-healthcare markets, such as the aerospace market.

Forward-Looking Statements
Statements in the press release regarding Symmetry Medical Inc.'s business, which are not historical facts, may be "forward-looking statements" that involve risks and uncertainties, within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are predictive in nature and are frequently identified by the use of terms such as "may," "might," "will," "should," "expect," "believe," "anticipate," "plan," "estimate," "intend," and similar words indicating possible future expectations, events or actions. Such predictive statements are not guarantees of future performance, and actual outcomes and results could differ materially from our current expectations. We refer you to the "Risk Factors" and "Forward Looking-Statements" sections in the Company's most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission as well as the Company's other filings with the SEC, which are available on the SEC's Web site at www.sec.gov.

 
 
 
 
Symmetry Medical Reports First Quarter 2009 Financial Results
Page 4
 
Symmetry Medical Inc.
Consolidated Statements of Operations

   
Three Months Ended
  
   
April 4,
    
March 29,
  
   
2009
    
2008
  
   
(In Thousands, Except Per Share Data)
  
   
(unaudited)
  
             
Revenue
   $ 101,422     $ 101,862  
Cost of Revenue
     76,864       77,916  
                 
Gross Profit
     24,558       23,946  
                 
Selling, general and administrative expenses
    
13,353
      
14,382
  
                 
Operating Income
     11,205       9,564  
Other (income)/expense:
                
Interest expense
     1,820       2,700  
Derivatives valuation (gain)/loss
     (394 )     1,165  
Other
     (296 )     (162 )
                 
Income before income taxes
     10,075       5,861  
Income tax expense
     3,228       1,894  
                 
Net income
   $ 6,847     $ 3,967  
                 
Net income per share:
                
Basic
   $ 0.19     $ 0.11  
                 
Diluted
   $ 0.19     $ 0.11  
                 
Weighted average common shares and equivalent shares outstanding:
                
Basic
     35,286       35,153  
Diluted
     35,381       35,335  

 
 
 
 
Symmetry Medical Reports First Quarter 2009 Financial Results
Page 5
 
Symmetry Medical Inc.
Consolidated Balance Sheets

   
April 4,
    
January 3,
  
   
2009
    
2009
  
   
(In Thousands)
  
   
(unaudited)
        
Assets:
            
Current Assets:
            
Cash and cash equivalents
   $ 18,957     $ 10,191  
Accounts receivable, net
     52,510       52,845  
Inventories
     68,942       61,111  
Refundable income taxes
     1,272       6,610  
Deferred income taxes
     4,509       3,993  
Other current assets
     4,253       3,154  
                 
Total current assets
     150,443       137,904  
Property and equipment, net
     115,737       115,045  
Goodwill
     153,003       153,521  
Intangible assets, net of accumulated amortization
     44,414       45,039  
Other assets
     1,558       1,728  
                 
Total Assets
   $ 465,155     $ 453,237  
                 
Liabilities and Shareholders' Equity:
                
Current Liabilities:
                
Accounts payable
   $ 30,254     $ 26,929  
Accrued wages and benefits
     8,757       12,784  
Other accrued expenses
     4,606       5,186  
Income tax payable
     3,969       2,637  
Deferred income taxes
     105       -  
Revolving line of credit
     3,265       2,495  
Current portion of capital lease obligations
     813       1,034  
Current portion of long-term debt
     17,775       16,900  
                 
Total current liabilities
     69,544       67,965  
Deferred income taxes
     18,966       18,131  
Derivative valuation liability
     3,377       3,771  
Capital lease obligations, less current portion
     3,228       3,356  
Long-term debt, less current portion
     110,500       107,600  
                 
Total Liabilities
     205,615       200,823  
                 
Shareholders' Equity:
                
Common Stock, $.0001 par value; 72,410 shares authorized; shares issued April 4, 2009—35,799; January 3, 2009—35,801
     4       4  
Additional paid-in capital
     276,629       275,890  
Accumulated deficit
     (14,660 )     (21,507 )
Accumulated other comprehensive loss
     (2,433 )     (1,973 )
                 
Total Shareholders' Equity
     259,540       252,414  
                 
Total Liabilities and Shareholders' Equity
   $ 465,155     $ 453,237