Syneron misses analysts' estimates by two cents
The aesthetic medical device company's fourth quarter earnings per share still grew 46%, while revenue grew 36%.
Globes correspondent 13 Feb 06 17:40
Aesthetic medical device company Syneron Medical Ltd. (Nasdaq: ELOS) of Yokne'am has reported a net profit of $12 million for the fourth quarter of 2005, representing a 46% increase over the comparable quarter of 2004.
Fully diluted earnings per share were $0.43, up 43% on the corresponding quarter of 2004. Nevertheless, fourth quarter 2005 earnings per share were $0.02 below the consensus analysts' estimate.
Revenue rose 36% from $17.5 million for the fourth quarter of 2004 to $23.7 million for the fourth quarter of 2005, but it too was below the analysts' estimate, which was for revenue of $24.2 million.
The company's gross profit margin for the fourth quarter of 2005 87%, the same as in the fourth quarter of 2004.
Revenue for 2005 as a whole rose 51% to $87.4 million $57.9 million in 2004. The annual net profit on a US GAAP basis was $41.1 million, compared with $27.3 million in 2004.
Earnings per diluted share on a US GAAP basis were $1.48. The US GAAP-based income includes $3.5 million of expenses for the company's secondary offering in March 2005 and the Thermage settlement in June 2005.
On a normalized proforma basis, net income was $44.6 million and EPS per diluted share $1.61, compared with $1.14 per diluted share for 2004.
R&D costs rose from $3.1 million in 2004 to $5 million in 2005.
During 2005, Syneron generated cash of $31.3 million from operations and $11.7 million from the exercise of options, giving a total cash position at the end of 2005 of $134.1 million, and shareholders' equity of $145.2 million.
Syneron CEO David Schlachet said, "We are very pleased with our ability to execute our unique business model and with our extremely high profitability. Although we have seen a slow down in our rate of growth in the fourth quarter, we are confident in our ability to continue Syneron's growth in 2006 and beyond, while maintaining our unique profitability structure." Mr. Schlachet continued, "In its first five years, Syneron has demonstrated its ability to grow at a very high rate taking advantage of its proprietary elos™ technology. With 51% growth in revenues in 2005, we estimate that our global market share has risen to approximately 15% with an installed world wide base of more than 4,000 units." Remarking on Syneron's future plans, Mr. Schlachet continued, "Now that Syneron has become a more mature company our strategic objective is to strengthen our position as a market leader by building the long-term plans of the company and the infrastructure to support it. Syneron is investing in enhancing its distribution channels and in the marketing and promotion of its products and technology."
Syneron said that, because of seasonality in the sector, it would issue annual revenue guidance rather than quarterly guidance. For 2006, Syneron sees revenue of $113-120 million, a 29-37% increase over 2005 revenue, and gross margin maintained at 85 to 87%. For the first quarter of 2006, the company expects about the same revenue as for the fourth quarter of 2005.
Published by Globes [online], Israel business news - www.globes.co.il - on February 13, 2006
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