Vital Images Announces Third Quarter Results
MINNEAPOLIS, Nov 4, 2009 (GlobeNewswire via COMTEX) -- By Staff
Company: Vital Images. Inc. (VTAL)
Vital Images, Inc. (Nasdaq:VTAL), a leading provider of advanced visualization and analysis solutions, today reported financial results for the third quarter ended September 30, 2009. Third quarter revenue was $14.3 million, compared to $17.7 million for the third quarter of 2008. Third quarter net loss was $750,000, or $(0.05) per diluted share, compared to a net loss of $243,000, or $(0.02) per diluted share, for the third quarter of 2008.
Third quarter adjusted EBITDA (a non-GAAP measure) was $1.2 million, compared to $1.4 million for the third quarter of 2008. Through the first nine months of 2009, adjusted EBITDA was $3.2 million, compared to $568,000 during the same period last year.
Michael H. Carrel, Vital Images president and chief executive officer, said, "There are encouraging signs that our marketplace may be improving. With positive adjusted EBITDA, as well as $140 million in cash and investments and a commitment to profitability, we are well positioned to continue our strategic investments in research and development, services and improving market share for future growth."
Carrel continued, "Our customers are excited about the recent launch of Vitrea Enterprise Suite and its productivity enhancing, centralized solution for managing volumetric data. We look forward to showing physicians the depth and breadth of capabilities within Vitrea Enterprise Suite at the upcoming RSNA conference. We were honored at the end of October when Vitrea Enterprise Suite was recognized by AuntMinnie.com editors and its expert panel of radiology professionals as the Minnies winner for Best New Radiology Software in 2009."
The company's total cash and investments were $140.3 million as of September 30, 2009, compared to $141.1 million as of June 30, 2009. During the third quarter of 2009, the company repurchased 30,000 shares of its common stock for $323,000 under its publicly announced share repurchase program. As of September 30, 2009, up to 588,000 shares remained to be purchased under the program.
Non-GAAP Information
To supplement the company's condensed consolidated financial statements presented on a GAAP basis, Vital Images uses adjusted EBITDA (a non-GAAP measure), which is adjusted to exclude certain items to enhance the overall understanding of our past financial performance. These adjustments to GAAP results are made with the intent of providing both management and investors a more complete understanding of Vital Images' underlying operational results and trends and our marketplace performance. In addition, these non-GAAP results are among the information management uses to establish internal operating budgets, supplement the financial results and forecasts reported to the company's board of directors, determine a portion of bonus compensation for executive officers and certain other key employees, and evaluate short-term and long-term operating trends in the company's core operations. The presentation of this additional information is not meant to be considered in isolation or as a substitute for results prepared in accordance with GAAP and may not be computed the same as similarly titled measures used by other companies. See Supplemental Financial Information section for a reconciliation from GAAP results to adjusted EBITDA.
Conference Call and Webcast
Vital Images will host a live webcast of its third quarter earnings conference call on Thursday, November 5, 2009 at 10:30 a.m. CT. To access this webcast, go to the investors' portion of the company's Web site, www.vitalimages.com, and click on the webcast icon. If you wish to listen to an audio replay of the conference call, dial (888) 203-1112 and enter conference call ID #9428296. The audio replay will be available beginning at 2:00 p.m. CT on Thursday, November 5, 2009 through 5:00 p.m. CT on Thursday, November 19, 2009.
About Vital Images
Vital Images, Inc., headquartered in Minneapolis, is a leading provider of advanced visualization and analysis software solutions. The company's technology gives radiologists, cardiologists, oncologists and other medical specialists time-saving productivity and communications tools that can be accessed throughout the enterprise and via the Web for easy use in the day-to-day practice of medicine. For more information, visit www.vitalimages.com.
The Vital Images, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5843
Forward-Looking Statements
Except for the historical information contained herein, the matters discussed in this news release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are intended to enjoy the protection of the safe harbor for forward-looking statements provided by that Act. These statements involve risks and uncertainties which could cause results to differ materially from those projected, including but not limited to dependence on market growth, challenges associated with international expansion, the ability to predict product, customer and geographic sales mix, fluctuations in interest rates, regulatory approvals, the timely introduction, availability and acceptance of new products, the impact of competitive products and pricing, dependence on major customers, the ability to successfully manage operating costs, fluctuations in quarterly results, approval of products for reimbursement and the level of reimbursement, and other factors detailed from time to time in Vital Images' SEC reports, including its annual report on Form 10-K for the year ended December 31, 2008. Vital Images encourages you to consider all of these risks, uncertainties and other factors carefully in evaluating the forward-looking statements contained in this release. As a result of these matters, changes in facts, assumptions not being realized or other circumstances, the company's actual results may differ materially from the expected results discussed in the forward-looking statements contained in this release. The forward-looking statements made in this release are made only as of the date of this release, and, except as may be required by law, the company undertakes no obligation to update them to reflect subsequent events or circumstances.
Vital Images(R) and Vitrea(R) are registered trademarks of Vital Images, Inc. Vital Images disclaims any proprietary interest in the marks and names of others.
Vital Images, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
For the Three For the Nine
Months Ended Months Ended
September 30, September 30,
------------------ ------------------
2009 2008 2009 2008
-------- -------- -------- --------
Revenue:
License fees $ 5,624 $ 9,114 $ 16,183 $ 26,178
Maintenance and services 8,274 8,157 25,206 23,502
Hardware 402 408 1,074 1,023
-------- -------- -------- --------
Total revenue 14,300 17,679 42,463 50,703
Cost of revenue:
License fees 749 1,181 2,277 3,345
Maintenance and services 2,351 2,561 6,996 7,612
Hardware 364 318 997 624
-------- -------- -------- --------
Total cost of revenue 3,464 4,060 10,270 11,581
Gross profit 10,836 13,619 32,193 39,122
Operating expenses:
Sales and marketing * 5,200 6,298 16,127 21,207
Research and development * 4,245 5,422 12,200 15,738
General and administrative * 2,405 3,348 7,645 9,935
Asset impairment -- -- 3,147 --
-------- -------- -------- --------
Total operating expenses 11,850 15,068 39,119 46,880
Operating loss (1,014) (1,449) (6,926) (7,758)
Interest income 200 1,012 960 3,856
-------- -------- -------- --------
Loss before income taxes (814) (437) (5,966) (3,902)
Provision (benefit) for income
taxes (64) (194) 14,656 (1,488)
-------- -------- -------- --------
Net loss $ (750) $ (243) $(20,622) $ (2,414)
======== ======== ======== ========
Net loss per share - basic
and diluted $ (0.05) $ (0.02) $ (1.44) $ (0.15)
======== ======== ======== ========
Weighted average common shares
outstanding - basic and diluted 14,204 15,711 14,336 16,535
======== ======== ======== ========
* Certain reclassifications have been made to prior
period amounts in order to conform to current period presentation -
see Supplemental Financial Information section.
Vital Images, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except per share amounts)
(Unaudited)
Sept. 30, Dec. 31,
2009 2008
-------- --------
Assets
Current assets:
Cash and cash equivalents $118,311 $109,706
Marketable securities 6,683 37,287
Accounts receivable, net 12,552 13,047
Deferred income taxes -- 654
Prepaid expenses and other current assets 2,134 2,179
-------- --------
Total current assets 139,680 162,873
Marketable securities 15,278 --
Property and equipment, net 6,168 11,519
Deferred income taxes -- 13,904
Other intangible assets, net 472 808
Goodwill 9,089 9,089
-------- --------
Total assets $170,687 $198,193
======== ========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 2,710 $ 3,792
Accrued compensation 2,741 2,936
Accrued royalties 621 1,057
Other current liabilities 2,095 1,947
Deferred revenue 14,972 17,724
-------- --------
Total current liabilities 23,139 27,456
Deferred revenue 862 1,164
Deferred rent 572 882
-------- --------
Total liabilities 24,573 29,502
-------- --------
Stockholders' equity:
Preferred stock: $0.01 par value; 5,000 shares
authorized; none issued or outstanding -- --
Common stock: $0.01 par value; 40,000 shares
authorized; 14,291 issued and outstanding
as of September 30, 2009; and 14,673 shares
issued and outstanding as of December 31, 2008 143 147
Additional paid-in capital 166,806 168,738
Accumulated deficit (21,002) (380)
Accumulated other comprehensive income 167 186
-------- --------
Total stockholders' equity 146,114 168,691
-------- --------
Total liabilities and stockholders' equity $170,687 $198,193
======== ========
Vital Images, Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
For the Nine
Months Ended
September 30,
-------- --------
2009 2008
-------- --------
Cash flows from operating activities:
Net loss $(20,622) $ (2,414)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization of property
and equipment 3,747 3,679
Amortization of identified intangibles 336 783
Loss on disposal of assets 112 --
Asset impairment 3,147 --
Provision for doubtful accounts 141 391
Deferred income taxes 14,664 (1,488)
Excess tax benefit from stock transactions -- (317)
Amortization of discount and accretion of
premium on marketable securities 241 (538)
Employee stock-based compensation 2,926 3,864
Amortization of deferred rent (296) (280)
Changes in operating assets and liabilities:
Accounts receivable 354 1,168
Prepaid expenses and other assets 45 (282)
Accounts payable (793) 349
Accrued expenses and other liabilities (596) 584
Deferred revenue (3,054) 835
-------- --------
Net cash provided by operating activities 352 6,334
-------- --------
Cash flows from investing activities:
Purchases of property and equipment (1,944) (3,994)
Purchases of marketable securities (21,749) (76,313)
Proceeds from maturities of marketable securities 36,709 48,857
Proceeds from sale of marketable securities -- 1,581
-------- --------
Net cash provided by (used in) investing
activities 13,016 (29,869)
-------- --------
Cash flows from financing activities:
Repurchases of common stock (6,081) (25,383)
Proceeds from sale of common stock under
stock plans 1,318 1,713
Excess tax benefit from stock transactions -- 317
-------- --------
Net cash used in financing activities (4,763) (23,353)
-------- --------
Net increase (decrease) in cash and cash
equivalents 8,605 (46,888)
Cash and cash equivalents, beginning of period 109,706 146,685
-------- --------
Cash and cash equivalents, end of period $118,311 $ 99,797
======== ========
Vital Images, Inc.
Supplemental Financial Information
Revenue Summary (dollars in thousands):
For the Three Months Ended For the Nine Months Ended
September 30, September 30,
------------------------- ------------------------
2009 2008 2009 2008
----------- ----------- ----------- -----------
Revenue:
License fees $ 5,624 $ 9,114 $16,183 $26,178
Maintenance
and services 8,274 8,157 25,206 23,502
Hardware 402 408 1,074 1,023
------- ------- ------- -------
Total
revenue $14,300 $17,679 $42,463 $50,703
======= ======= ======= =======
Revenue by channel
and as a percent
of total revenue:
Direct and
other
distributors $ 6,321 44% $ 7,890 45% $18,702 44% $24,248 48%
Toshiba 7,979 56 9,789 55 23,761 56 26,455 52
----------- ----------- ----------- -----------
Total
revenue $14,300 100% $17,679 100% $42,463 100% $50,703 100%
=========== =========== =========== ===========
License fee
revenue by
channel and as
a percent of
total license
fee revenue:
Direct and
other
distributors $ 928 17% $ 2,296 25% $ 2,633 16% $ 8,143 31%
Toshiba 4,696 83 6,818 75 13,550 84 18,035 69
----------- ----------- ----------- -----------
Total
license
fee
revenue $ 5,624 100% $ 9,114 100% $16,183 100% $26,178 100%
=========== =========== =========== ===========
Maintenance
and services
revenue by
channel and as
a percent of
total maintenance
and services
revenue:
Direct and
other
distributors $ 5,051 61% $ 5,288 65% $15,338 61% $15,218 65%
Toshiba 3,223 39 2,869 35 9,868 39 8,284 35
----------- ----------- ----------- -----------
Total
maintenance
and services
revenue $ 8,274 100% $ 8,157 100% $25,206 100% $23,502 100%
=========== =========== =========== ===========
Revenue by
geography:
United States $ 9,516 $11,996 $28,195 $37,207
Europe 2,584 3,475 7,599 7,435
Asia and
Pacific 1,279 1,213 3,422 3,162
Other foreign 921 995 3,247 2,899
------- ------- ------- -------
Total
revenue $14,300 $17,679 $42,463 $50,703
======= ======= ======= =======
Export revenue
as a percent of
total revenue: 33% 32% 34% 27%
Operating Expense Reclassifications:
During the third quarter of 2009, the company reclassified certain items within its operating expense categories. As a result, prior period operating expense amounts have been reclassified in order to conform to the current period presentation. Expenses related to certain product development related activities were reclassified from general and administrative expense and sales and marketing expense to research and development expense, and had no effect on previously reported stockholders' equity, net loss or net cash flows.
Quarterly operating expenses for 2008 and the first three quarters of 2009 using the current period presentation were as follows (in thousands):
For the Three Months Ended
-------------------------------------------------------
Mar June Sept Dec Mar June Sept
31, 30, 30, 31, 31, 30, 30,
2008 2008 2008 2008 2009 2009 2009
------- ------- ------- ------- ------- ------- -------
Operating
expenses:
Sales and
marketing $ 7,439 $ 7,470 $ 6,298 $ 6,628 $ 5,440 $ 5,487 $ 5,200
Research
and
development 5,091 5,225 5,422 4,617 4,002 3,953 4,245
General and
admini-
strative 3,457 3,130 3,348 3,308 2,743 2,497 2,405
Restructuring
charge -- -- -- 660 -- -- --
Asset
impairment -- -- -- -- -- 3,147 --
------- ------- ------- ------- ------- ------- -------
Total
operating
expenses $15,987 $15,825 $15,068 $15,213 $12,185 $15,084 $11,850
======= ======= ======= ======= ======= ======= =======
Reconciliation from GAAP results to adjusted EBITDA (in thousands):
For the Three For the Nine
Months Ended Months Ended
September 30, September 30,
----------------- -----------------
2009 2008 2009 2008
------- ------- ------- -------
Adjusted EBITDA (in thousands):
Operating loss $(1,014) $(1,449) $(6,926) $(7,758)
Equity-based compensation 952 1,322 2,926 3,864
Depreciation and amortization
of property and equipment 1,202 1,223 3,747 3,679
Amortization of identified
intangibles 90 261 336 783
Asset impairment -- -- 3,147 --
------- ------- ------- -------
Adjusted EBITDA $ 1,230 $ 1,357 $ 3,230 $ 568
======= ======= ======= =======
This news release was distributed by GlobeNewswire, www.globenewswire.com
SOURCE: Vital Images, Inc.
CONTACT: Vital Images Peter J. Goepfrich, Chief Financial Officer (952) 487-9500 www.vitalimages.com Padilla Speer Beardsley Nancy A. Johnson (612) 455-1745 njohnson@psbpr.com Marian Briggs (612) 455-1742 mbriggs@psbpr.com
Copyright (C) 2009 GlobeNewswire. All rights reserved
News Provided by COMTEX
Company: Vital Images. Inc. (VTAL)
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