IMRIS Reports First Quarter 2012 Financial Results
WINNIPEG, May 14, 2012 /PRNewswire/ – IMRIS Inc. (NASDAQ: IMRS; TSX: IM)
(“IMRIS” or the “Company”) today reported its results for the first
quarter of 2012. All figures are reported in US dollars.
Highlights:
-- First quarter 2012 orders of $24 million drive backlog to
$115.7 at March 31, 2012
-- Three VISIUS Surgical Theatres sold in first quarter to
hospitals in China, the Middle East and the US
-- Positive results in first randomized trial demonstrate benefits
of VISIUS Surgical Theatre
-- Image Guided Surgical Robot on schedule for July 2012 FDA
submission
During the first quarter of 2012, revenues were $3.5 million which was
consistent with expectations for fewer planned installations in the
period resulting in lower revenues in the first quarter of 2012.
Revenues will ramp in the second quarter with accelerating expansion
though the second half of the year. Lower revenue combined with
continued investment in new product development, marketing, sales and
customer support initiatives contributed to net losses of $8.4 million
in the first quarter 2012 compared with net loss of $4.6 million in the
first quarter of 2011.
Financial Highlights:
___________________________________________________________________
| |3 months ended Mar 31 (unaudited)|
| |_________________________________|
|($000's except per share amounts)| 2012 | 2011 | Change |
|_________________________________|_______|_______|_________________|
|Sales | 3,493| 11,057| (68%) |
|_________________________________|_______|_______|_________________|
|Gross profit | 1,394| 4,453| (69%) |
|_________________________________|_______|_______|_________________|
| Gross profit as % of sales | 39.9%| 40.3%| n/mf1 |
|_________________________________|_______|_______|_________________|
|Operating expenses | 9,939| 9,468| 5% |
|_________________________________|_______|_______|_________________|
|Adjusted EBITDA2 |(7,222)|(3,850)| (88%) |
|_________________________________|_______|_______|_________________|
|Operating loss |(8,545)|(5,015)| (70%) |
|_________________________________|_______|_______|_________________|
|Net income (loss) |(8,350)|(4,588)| (82%) |
|_________________________________|_______|_______|_________________|
|Basic earnings (loss) per share | (0.18)| (0.10)| (80%) |
|_________________________________|_______|_______|_________________|
|Diluted earnings (loss) per share| (0.18)| (0.10)| (80%) |
|_________________________________|_______|_______|_________________|
|Cash, cash equivalents & accounts| | | |
|receivable | 44,614| 63,774| (30%) |
|_________________________________|_______|_______|_________________|
|Total assets | 85,066|104,294| (18%) |
|_________________________________|_______|_______|_________________|
________________________________
(1) Not meaningful.
(2) The Company defines adjusted EBITDA as earnings before interest income,
stock based compensation, foreign exchange, embedded derivatives,
income taxes, and amortization.
First Quarter Results:
Revenues
Revenues in the first quarter of 2012 were $3.5 million compared to
$11.1 million in the prior year period. The decreased revenues
primarily reflected a reduction in the conversion of order backlog as
planned installation activities were lower in the first three months of
the year. Service contract revenues were $1.1 million in the 2012
first quarter, compared with $0.6 million during the same period in
2011 as a result of more VISIUS Surgical Theatres on service programs
in 2012.
Gross Profit
Gross profit was $1.4 million in the first quarter compared with $4.5
million in Q1 2011. The first quarter 2012 gross margin as a percentage
of sales was 39.9% compared to 40.3% in the prior year period. The
lower gross profit in this year’s period is primarily due to lower
system installations. Gross margin as a percentage of sales was
marginally lower due to higher final closing costs and warranty
provisions on projects, which have a higher impact on margins when
there are lower product deliveries in any given period. These costs
were partially offset as a result of cost reductions and recoveries on
several projects.
Operating Expenses
Investment in research and development in support of the Company’s MR
guided radiation therapy product and image guided surgical robotics
program continued to be a major focus in the first quarter of 2012.
These activities increased research and development expenditures to
$3.6 million in the first quarter of 2012 compared with $2.5 million in
Q1 2011. This increase was partially offset by decreased expenditures
in administration and other areas of the business as part of a focused
effort to manage costs in non-customer facing activities. The Company
has continued to invest in sales and marketing programs as well as
customer support necessary to drive new order bookings and service
those new customers through to clinical operation.
Adjusted EBITDA and Operating Loss
Adjusted EBITDA in the first quarter of 2012 was negative $7.2 million
compared with negative $3.9 million in the first quarter of 2011.
Operating loss was $8.5 million in the first quarter of 2012 compared
with operating loss of $5.0 million in Q1 2011. The year over year
decreases in Adjusted EBITDA and operating loss reflect lower revenues
and gross profit combined with higher investment in research and
development as described above.
Net Loss
Net loss for the first quarter of 2012 was $8.4 million compared to a
net loss of $4.6 million in Q1 2011. The higher net losses in 2012
reflect the year-over-year increases in operating losses, driven
primarily by lower revenue in the period. In Q1 2012, the Company
recorded a foreign exchange gain of $0.2 million versus $0.4 million in
Q1 2011.
Liquidity and Capital Resources
Cash and cash equivalents at March 31, 2012 totaled $35.4 million. In
addition, the Company had accounts receivable of $9.2 million. These
funds, together with ongoing operating cash flow, will be used to fund
the Company’s working capital and general corporate purposes.
Backlog(3)
At March 31, 2012, IMRIS’ backlog was $115.7 million. During the first
quarter of 2012, $3.5 million of backlog was converted into revenues
and $24 million in new orders were received. The change in the US
dollar versus the foreign currencies of the orders in backlog resulted
in a $0.2 million increase in the value of the backlog. Total backlog
at March 31, 2012 was comprised of $78.1 million of system orders and
$37.6 million in service contracts.
Other Developments
IMRIS hosted its first-ever VISIUS Surgical Theatre symposium at the
annual meeting of the American Association of Neurological Surgeons at
AANS 2012 in Miami Beach, FL. The symposium, which took place on April
16, 2012, was chaired by Dr. Joseph Piepmeier, Chief of the Section of
Surgical Neuro-oncology at Yale University School of Medicine. The
program featured presentations from four surgeons from the US and China
who shared their experiences and clinical findings in a range of
neurosurgical applications.
Separately at the AANS 2012, there were two oral presentations and six
e-posters based on studies performed at hospitals with a VISIUS
Surgical Theatre. Dr. Xiaolei Chen, Associate Professor, Neurosurgery,
Chinese PLA General Hospital, Beijing, presented preliminary results of
the first-ever randomized trial that studied the resection of low-grade
insular glioma using high-field intraoperative MR imaging. Dr. Chen’s
presentation is one of several that indicate that intraoperative MR
imaging is gaining broad acceptance as a “best clinical practice” in
neurosurgery.
Outlook
Sales programs with potential new customers of the VISIUS Surgical
Theatre remain active as bookings increase and the Company’s sales
funnel continues to broaden. The Company believes the economic climate
has improved and, as markets continue to stabilize, the trend will be
for a strengthening of bookings performance driven by the underlying
clinical demand for VISIUS Surgical Theatres.
In the balance of 2012, IMRIS expects top line improvement with annual
revenues forecast to be in the range of $57 million to $60 million.
Quarterly revenues are expected to increase significantly from Q1 2012
with Q2 2012 revenues anticipated to be $15 million to $16 million.
In 2012, annual gross margin is expected to be comparable to 2011
levels, with quarterly gross margins expected to vary somewhat
depending on the timing of underlying system installations in the
respective quarters. As market recognition and demand for our products
expands, the Company’s margins are anticipated to increase into the mid
40% range.
The Company’s priorities for 2012 remain a focused drive to maximize
bookings with targeted marketing programs together with increased
investment to complete development of the Company’s image guided
surgical robot, its image guided radiation therapy product, and to
further improve the capabilities of the VISIUS Surgical Theatre. In
2012, research & development expenses are expected to be approximately
$13 million to $15 million with the remainder of operating expenses to
remain consistent with 2011 levels.
IMRIS is well positioned to build the current business and add new
products for future growth. With cash, cash equivalents and accounts
receivable at March 31, 2012 of $44.6 million and order backlog of
$115.7 million, the Company has a strong base from which to continue to
fund operations and product development.
The Company’s full financial statements as well as management’s
discussion and analysis will be available at www.sedar.com, www.sec.gov and www.imris.com.
___________________________
(3) See “Non-GAAP Financial Measures” in the Company’s Q1 2012 MD&A for
further information on backlog.
Conference Call
Management will host a conference call to discuss the results at 5:00 pm ET today, Monday, May 14, 2012. Following management’s presentation, there will be a
question-and-answer session for analysts and institutional investors.
To participate in the teleconference, please call 416-644-3414 or 800-814-4859. To access the live audio webcast, please visit IMRIS’s website at www.imris.com. A taped rebroadcast will be available to listeners following the call
until midnight (ET) on May 21, 2012. To access the rebroadcast,
please call 416-640-1917 or 877-289-8525 and enter passcode 4535294#.
The webcast will also be archived on IMRIS’ website.
About IMRIS
IMRIS (NASDAQ: IMRS; TSX: IM) is a global leader in providing image
guided therapy solutions through its VISIUS Surgical Theatre – a
revolutionary, multifunctional surgical environment that provides
unmatched intraoperative vision to clinicians to assist in decision
making and enhance precision in treatment. VISIUS Surgical Theatres
serve the neurosurgical, cardiovascular and cerebrovascular markets and
have been selected by leading medical institutions around the world.
For more information, visit www.imris.com.
Forward-Looking Statements
This press release may contain or refer to forward-looking information
based on current expectations. In some cases, forward-looking
statements can be identified by terminology such as “anticipate”,
“may”, “expect”, “believe”, “prospective”, “continue” or the negative
of these terms or other similar expressions concerning matters that are
not historical facts. These statements should not be understood as
guarantees of future performance or results. Such statements involve
known and unknown risks, uncertainties and other factors that may cause
actual results, performance or achievements to be materially different
from those implied by such statements. Although such statements are
based on management’s reasonable assumptions, there can be no assurance
that actual results will be consistent with such statements.
Forward-looking statements are subject to significant risks and
uncertainties, and other factors that could cause actual results to
differ materially from expected results. These forward-looking
statements are made as of the date hereof and we assume no
responsibility to update or revise them to reflect new events or
circumstances.
SOURCE IMRIS Inc.
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