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THRM Reports 3Q06 Results

[These are their first quarterly results as a public company. There’s a CC in 15 minutes that I will listen to because THRM is on my watchlist for shorting.]

http://biz.yahoo.com/prnews/061206/sfw083.html?.v=101

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Thermage, Inc. Reports Record Third Quarter 2006 Results

Wednesday December 6, 4:00 pm ET

Revenues Increase 47%, Gross Profit Up 53% over Prior Year Period

HAYWARD, Calif., Dec. 6 /PRNewswire-FirstCall/ -- Thermage, Inc. (Nasdaq: THRM ), a leader in non-invasive tissue tightening in the aesthetic industry, today reported financial results for the third quarter and nine months ended September 30, 2006.

Revenues for the quarter ended September 30, 2006 were $12.5 million, up 47% from $8.5 million for the quarter ended September 30, 2005. Gross profit increased to $9.0 million or 72% of revenue, for the quarter ended September 30, 2006 up from $5.9 million or 70% of revenue for quarter ended September 30, 2005. The Company reported a GAAP net loss of $1.5 million, or $0.36 per share, for the quarter ended September 30, 2006, versus net loss of $4.1 million, or $1.11 per share, for the quarter ended September 30, 2005. Non-GAAP net loss for the third quarter of 2006 and 2005 were $0.9 million, or $0.06 per share, and $2.7 million, or $0.17 per share, respectively.

"Our third quarter financial performance was driven by the strong growth of consumable product sales," said Stephen J. Fanning, President and Chief Executive Officer. "Our ThermaTips and other consumable products represented 71% of total revenue during the period, while 26% of revenue was generated from the sale of ThermaCool® systems. The U.S. and international businesses each experienced more than a 60% increase in total ThermaTip(TM) unit volume over the prior year period. Our revenue model is focused on consumable products as opposed to capital equipment and, as a result, the proportion of our revenue derived from consumable products has increased each year over the past four years."

"We are particularly pleased with the market adoption of our Eyes by Thermage(TM) procedure using our 0.25cm ThermaTip product, as well as the strong initial market response to our Tummy by Thermage(TM) procedure introduced in mid-October utilizing our 900 pulse count 3.0cm ThermaTip," continued Mr. Fanning. "We also experienced solid growth in sales of our ThermaCool systems. Based on our performance to date in the fourth quarter, we expect to finish 2006 with over 2,000 ThermaCool RF generator systems in the market."

"Our cash and cash equivalent balance at the end of the third quarter of $10.5 million was augmented by approximately $40 million in net proceeds from our IPO, providing Thermage with the necessary capital to pursue its growth opportunities. As we look ahead, we will continue to focus on our core strengths -- innovative, proprietary technology, a business model built on strong recurring revenue and our partnerships with our customers. We believe we are well-positioned to continue our strong growth and to leverage our infrastructure to achieve sustained profitability," concluded Mr. Fanning.

Revenues for the nine months ended September 30, 2006 were $39.6 million, up 26% from $31.3 million for the nine months ended September 30, 2005. Gross profit increased to $28.4 million, or 72% of revenue, up from $22.5 million, or 72% of revenue, for the nine months ended September 30, 2005. The Company reported a GAAP net loss of $5.3 million, or $1.26 per share, for the nine months ended September 30, 2006, versus net loss of $4.2 million, or $1.16 per share, for the nine months ended September 30, 2005. Non-GAAP (1) net loss for the first nine months of 2006 and 2005 were $1.6 million, or $0.10 per share, and $4.2 million, or $0.27 per share, respectively.

Guidance:

Management believes that revenue for the fourth quarter and full year ending December 31, 2006, will be in a range of approximately $14.0 million to $14.5 million and $53.5 million to $54.0 million, respectively. The full year 2006 revenue expectations represent approximately a 32% increase over full year 2005.

For the fourth quarter and full year ending December 31, 2006, non-GAAP loss per share is expected to be breakeven and $0.09, respectively.

Conference Call

The conference call is scheduled to begin at 1:30 p.m. PST (4:30 p.m. EST) on December 6, 2006. The call will be broadcast live over the Internet hosted at the Investor Relations section of the Company's website at www.thermage.com. In addition, you may call to listen to the live broadcast: 800-257-1836 for domestic participants and 303-262-2143 for international participants. Participating in the call will be Stephen J. Fanning, President and Chief Executive Officer, and Laureen DeBuono, Chief Financial Officer.

A taped replay of the conference call will also be available beginning approximately one hour after the call's conclusion and will remain accessible for seven days. This replay can be accessed by dialing 800-405-2236, Pass code 11077434# for domestic callers and 303-590-3000, Pass code 11077434# for international callers. An archived web cast will also be available at www.thermage.com.

About Thermage, Inc.

Thermage, Inc. (Nasdaq: THRM ) is one of the premier medical device companies for aesthetics applications. The Company's innovative radiofrequency (RF) technology provides a safe, non-invasive procedure to tighten tissue. The Company's ThermaCool® system is marketed in approximately 70 countries to physicians, including dermatologists, plastic surgeons, and other cosmetic physicians. Thermage was founded in 1996. The Company received FDA clearance and commercially launched the ThermaCool system in 2002. The Company is based in Hayward, California.
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