Thermage Announces First Quarter 2008 Financial Results
Thursday May 8, 4:01 pm ET
Systems and Tip Revenue Up Domestically and Internationally
U.S. Sales Increase 8% Year-Over-Year
U.S. ThermaCool NXT System Sales Grow 29% Year-Over-Year
HAYWARD, Calif., May 8 /PRNewswire-FirstCall/ -- Thermage, Inc. (Nasdaq: THRM - News), a leader in non-invasive tissue tightening in the aesthetic industry, reported today its financial results for the first quarter ended March 31, 2008.
Revenue for the first quarter of 2008 was $16.2 million, up 7% from $15.2 million for the first quarter of 2007. Domestic revenue increased 8% and international revenue was up 6% compared with the prior year's first quarter. Gross profit for the first quarter of 2008 was $11.9 million, representing 73.2% of revenue, compared with $11.0 million, or 72.6% of revenue, for the same quarter of 2007.
The Company reported a net loss of $2.2 million, or $(0.09) per share, versus net income of $0.1 million, or breakeven earnings per share, for the same quarter of the prior year. Non-GAAP (1) net loss for the first quarter of 2008 was $1.3 million, or $(0.05) per share, compared to net income of $1.3 million, or $0.05 per diluted share, for the prior year period. Included in the first quarter 2008 net loss were approximately $1.0 million of expenses for business development activities that were terminated during the quarter.
"We grew revenue both in the U.S. and internationally, despite a softening aesthetics market," said Stephen J. Fanning, Chairman, President and Chief Executive Officer. "Revenue from both treatment tips and systems increased during the quarter. Our systems sales during the quarter included a high percentage of upgrades for existing customers, the second highest quarter for upgrade units since the NXT system was introduced in the first quarter of 2007. The growth in upgrades demonstrates the continued commitment by our customers to Thermage procedures."
"Thermage is focused on a strategy that includes organic growth, as well as complementary acquisitions that add value for our customers and shareholders," continued Mr. Fanning. "One of the primary reasons behind our IPO was to raise funds that would allow us to pursue this strategy. During the first quarter, we reached an advanced stage of negotiations with a potential acquisition target and had performed significant due diligence on the project before negotiations were terminated. We incurred approximately $1.0 million in outside advisory fees pursuing this acquisition. We remain committed to our strategy to build our presence in the aesthetics market, both organically and through acquisitions that will allow us to expand our product offerings to our customer base and leverage our operating infrastructure."
"Looking at the remainder of 2008, the recent bifurcation of our domestic salesforce, innovative sales strategies such as our Infinity program, and recently introduced tips and procedures, we believe we are positioned for continued revenue growth. While we anticipate that economic conditions will remain challenging throughout the year, we will continue our focus to drive revenue, expand market share, and build upon our reputation as a leader in safe, effective skin tightening and contouring procedures," concluded Mr. Fanning.
Management currently expects 2008 revenue to be in a range of $67 million to $70 million. With the revised revenue guidance, as well as the business development expenses incurred during the first quarter, the Company expects net income for the full year 2008 on a GAAP basis to be between breakeven and $0.03 per diluted share. Non-GAAP (1) net income for the full year 2008, which excludes estimated stock based compensation charges of approximately $4.6 million, is expected to be in a range of $0.18 to $0.21 per diluted share. The per share earnings amounts are based on weighted average shares of 26 million.
(1) To supplement the condensed financial information presented on a GAAP
basis, management has provided non-GAAP net income and loss, and
non-GAAP earnings per share measures that exclude the impact of all
stock-based compensation expenses, net of income taxes. The Company
believes that these non-GAAP financial measures provide investors with
insight into what is used by management to conduct a more meaningful
and consistent comparison of the Company's ongoing operating results
and trends, compared with historical results. This presentation is
also consistent with management's internal use of the measure, which
it uses to measure the performance of ongoing operating results,
against prior periods and against our internally developed targets. A
table reconciling the GAAP financial measures to the non-GAAP measures
is included in the condensed financial information attached to this
The conference call is scheduled to begin at 1:30 p.m. PDT (4:30 p.m. EDT) on May 8, 2008. The call will be broadcast live over the Internet hosted at the Investor Relations section of the Company's website at http://www.thermage.com
. In addition, you may call to listen to the live broadcast: 866-249-5225 for domestic participants and 303-262-2006 for international participants. Participating in the call will be Stephen J. Fanning, Chairman, President and Chief Executive Officer, and Jack Glenn, 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 for domestic callers and 303-590-3000 for international callers. Both callers will need to use the Passcode 11113200#. An archived webcast will also be available at http://www.thermage.com