PRESS RELEASE
Published on August 5, 2003
Exhibit 99.1
ResMed Inc. Announces Record Financial Results
For Quarter and Year Ended June 30, 2003
SAN DIEGO, Aug. 5 /PRNewswire-FirstCall/ -- ResMed Inc. (NYSE: RMD)
announced record revenue and income results for the quarter and year ended
June 30, 2003. Revenue for the quarter was $80.7 million, an increase of 43%
over the quarter ended June 30, 2002. Income from operations and net income
for the June 30, 2003 quarter increased to $18.6 million and $13.5 million
respectively, an increase of 55% and 38%.
Selling, general and administration (SG&A) costs for the quarter were
$25.6 million, an increase of $6.6 million or 35%, over the same period in
fiscal 2002. The increase in SG&A related primarily to an increase in
selling and administration personnel to meet expanding opportunities in the
sleep-disordered breathing market and $1.0 million in legal costs
predominantly associated with outstanding patent infringement lawsuits against
competitors. SG&A expenditure as a percentage of revenue was 31.7% in the
June quarter compared to 33.8% for the same period in fiscal 2002.
Research and development expenditure, at 7.7% of revenues, increased
during the three months ended June 30, 2003 to $6.2 million from $4.1 million
in the quarter ended June 30, 2002. The increase of 51% in research and
development outlays reflects ResMed's continuing commitment to innovation
within its product portfolio, as well as an ongoing commitment to clinical
research and product development, particularly in evolving hypertension,
stroke and congestive heart failure markets. The increase in research and
development expenditure, adjusted for the effect of a stronger Australian
dollar, was 31%. The R&D spend should continue at around 8% of revenues.
Company revenues for fiscal year 2003 were $273.6 million, an increase
of 34% over the year ended June 30, 2002. Net income for the year was
$45.7 million or $1.33 per share, on a diluted basis, compared with net income
of $37.5 million or $1.10 per share for fiscal year 2002. Net income
increased by 22%, while EPS, on a diluted basis, improved by 21%.
Inventories of $49.4 million were flat compared to March 2003 levels.
Inventory turnover improved 22 days from the March quarter. Accounts
receivable days sales outstanding at 62 days, improved by 6 days compared to
March 2003 quarter and continue to compare favorably to industry peers.
Peter C. Farrell, PhD, Chairman and Chief Executive Officer, commented,
"These record profit and revenue results for the June quarter and fiscal year
2003 reflect ResMed's continuing strong sales and profit growth. Our
operating cash flow for the June quarter, was a record-breaking $22.1 million.
Domestic sales increased by 28% over the June 2002 quarter to a record
$36.3 million, reflecting very healthy domestic demand for our
sleep-disordered breathing products. International sales increased by a
healthy 60%, over the June 2002 quarter, reflecting growth across all major
markets as well as a stronger Euro and SARS-related sales of approximately
$5.0 million."
Dr. Farrell also commented, "We were delighted with the way the Company
ended fiscal 2003, especially relating to our strong cash flow. We are making
encouraging progress in the cardiovascular market as we continue to develop
our strategic partnerships with Medcath Corporation and Guidant Corporation.
In addition, we have some exciting new products to be released during the next
two quarters as well as other products under development."
Looking forward, we project the overall market for our products to
continue to grow annually at approximately 20% over the next 12-18 months. We
continue to believe that our annual revenue growth will meet or exceed this
market growth rate, excluding the impact of any non-recurring issues, such as
the recent SARS epidemic.
ResMed is a leading developer, manufacturer, and marketer of medical
equipment for the diagnosis, treatment, and management of sleep-disordered
breathing, selling a comprehensive range of products in over 60 countries.
ResMed will host a conference call at 1:30 pm Pacific Daylight Time (PDT)
today to discuss these quarterly results. Individuals wishing to access the
conference call may do so via ResMed's Web site at www.resmed.com . Please
allow extra time prior to the call to visit the site and download the
streaming media player (Windows Media Player) required to listen to the
Internet broadcast. The online archive of the broadcast will be available
approximately 90 minutes after the live call and will be available for two
weeks. A telephone replay of the conference call is available by dialing
(888) 286-8010 (domestic) and +1 (617) 801-6888 (international) and entering
conference ID No. 83532481.
Further information can be obtained by contacting David Pendarvis at
ResMed Inc. San Diego, on (858) 746-2568; Adrian Smith at ResMed Limited
Sydney on +61 (2) 9886-5407; or by visiting the Company's multilingual Web
site at www.resmed.com .
Statements contained in this release that are not historical facts are
"forward-looking" statements as contemplated by the Private Securities
Litigation Reform Act of 1995. These forward-looking statements, including
statements regarding the Company's future revenue, earnings or expenses, new
product development and new markets for the Company's products, are subject to
risks and uncertainties, which could cause actual results to materially differ
from those projected or implied in the forward-looking statements. Those
risks and uncertainties are discussed in the Company's Annual Report on Form
10-K for its most recent fiscal year and in other reports the Company files
with the US Securities & Exchange Commission. Those reports are available on
the Company's Web site.
ResMed Inc. and Subsidiaries
Consolidated Statements of Income
(In US$ thousands, except per share data)
Three Months Ended Year Ended
June 30, June 30,
2003 2002 2003 2002
(unaudited) (unaudited)
Net revenue 80,695 56,247 273,570 204,076
Cost of sales 30,331 19,439 100,483 70,827
Gross profit 50,364 36,808 173,087 133,249
Operating expenses:
Selling, general and
administrative 25,578 19,014 85,313 64,481
Research and
development 6,235 4,140 20,534 14,910
In process R&D written
off on acquisition -- 350 -- 350
Donation to Foundations -- 1,349 -- 2,349
Total operating
expenses 31,813 24,853 105,847 82,090
Income from operations 18,551 11,955 67,240 51,159
Other:
Interest income
(expense), net (418) (763) (2,549) (3,224)
Other income
(expense), net 1,786 (363) 1,907 108
Gain on extinguishment
of debt -- 3,560 529 6,549
Total other income
(expenses), net 1,368 2,434 (113) 3,433
Income before income
taxes 19,919 14,389 67,127 54,592
Income taxes 6,395 4,579 21,398 17,086
Net income 13,524 9,810 45,729 37,506
Basic earnings
per share $0.41 $0.30 $1.38 $1.17
Diluted earnings
per share $0.39 $0.29 $1.33 $1.10
Basic shares
outstanding 33,275 32,714 33,054 32,174
Diluted shares
outstanding 34,726 34,011 34,439 34,080
ResMed Inc. And Subsidiaries
Consolidated Balance Sheets
(In US$ thousands except share and per share data)
June 30, 2003 June 30, 2002
(unaudited)
Assets
Current assets:
Cash and cash equivalents $114,491 $72,860
Marketable securities - available for sale 6,533 19,979
Accounts receivable, net 56,694 46,199
Inventories 49,386 41,173
Deferred income taxes 8,301 9,289
Prepaid expenses and other current assets 6,500 4,213
Total current assets 241,905 193,713
Property, plant and equipment, net of
accumulated depreciation 104,687 79,279
Patents, net of accumulated amortization 3,745 2,653
Goodwill 102,160 92,536
Other assets 7,098 8,010
Total assets $459,595 $376,191
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $19,368 $11,605
Accrued expenses 19,140 15,273
Income taxes payable 3,408 6,905
Deferred revenue 6,355 3,636
Payable for property purchase -- 11,552
Current portion of deferred profit
on sale leaseback 2,312 1,933
Total current liabilities 50,583 50,904
Non current liabilities:
Deferred revenue 7,210 5,402
Deferred profit on sale and leaseback 2,119 3,705
Convertible Subordinated Notes 113,250 123,250
Total non-current liabilities 122,579 132,357
Total liabilities $173,162 $183,261
Stockholders' Equity:
Preferred stock, $0.01 par value,
2,000,000 shares authorized; none issued -- --
Series A Junior Participating preferred
stock, $0.01 par value, 250,000 shares
authorized; none issued -- --
Common Stock $0.004 par value
100,000,000 shares authorized; issued and
outstanding 33,370,885 at June 30,2003 and
32,818,160 at June 30, 2002 (excluding
415,365 and 290,047 shares held as Treasury
stock respectively) 133 132
Additional paid-in capital 107,433 94,153
Retained earnings 160,372 114,643
Treasury Stock (11,415) (7,873)
Accumulated other comprehensive
income (loss) 29,910 (8,125)
Total stockholders' equity 286,433 192,930
Commitments and contingencies -- --
Total liabilities and stockholders' equity $459,595 $376,191
SOURCE ResMed Inc.
-0- 08/05/2003
/CONTACT: David Pendarvis of ResMed Inc., +1-858-746-2568; or Adrian
Smith of ResMed Limited Sydney, +61 (2) 9886-5407/
/Web site: http://www.resmed.com /
(RMD)
CO: ResMed Inc.
ST: California
IN: MTC BIO HEA
SU: ERN CCA MAV