Quarterly earnings are in full swing and we are excited to present financial highlights for Pennsylvania-based PhotoMedex, Inc. (PHMD-NASDAQ), which were just reported for the three-month period ended March 31, 2013.
In addition to the below discussion, detailed information from Crystal Research Associates about PhotoMedex’s business, product lines, strategies, market opportunities, and competition is available here, and the Company’s SEC filings can be accessed here.
Over $57 Million in Quarterly Revenue
Global skin health company PhotoMedex has posted considerable growth since its 2011 merger with Radiancy Inc. First quarter 2013 revenue was up 14% over the companies’ first combined quarter in 2012. PhotoMedex reported quarterly revenue of $57.2 million for the period ended March 31, 2013, which included year-over-year gains in each of the following business segments: (1) consumer revenues from the innovative no!no!™ products, including increases in all consumer avenues (direct-to-consumer, global retail and home shopping, and through distributors); (2) sales and treatment revenues from the professional XTRAC® excimer laser; and (3) sales of the NEOVA® topical skin care line.
Highlights: Effective Corporate Strategies Drive Growth
Over the past year, PhotoMedex and Radiancy have executed an efficient merger, blending PhotoMedex’s expertise in physician sales and deep product line of capital equipment and topical formulations with Radiancy’s highly advanced consumer sales engine, creative marketing programs, and global distributor and retail network. Effectively leveraging these skills has been key to the Company’s growth thus far, and is expected to be a major driver of sales going forward as PhotoMedex continues to incorporate consumer marketing strategies into its professional (dermatologist- and aesthetician-targeted) sales.
As an example of this type of integration, in late 2012, PhotoMedex launched a nationwide education campaign targeted at U.S. consumers and physicians, with the intent of raising awareness of the Company’s XTRAC® tools to treat psoriasis and vitiligo patients. As part of the “Live Clear. Live Free.” Campaign, national direct-to-consumer radio and television advertising began airing in November 2012, supported by a direct mail campaign. A 24/7 call center staffed with clinical specialists provides insurance guidance, answers questions on XTRAC® therapy, and expedites appointments with physicians. In addition, the XTRAC® website,www.LiveXTRACClear.com, has been equipped with patient and physician resources, and new patient education materials were delivered to all 300 authorized XTRAC® practices nationwide. In addition to providing patients with key information about their skin diseases and treatment options, “Live Clear. Live Free.” seeks to drive awareness of XTRAC® care among a wider physician base beyond just dermatologists commonly treating psoriasis and vitiligo patients.
As a result of this push, PhotoMedex reported XTRAC® adjusted treatment revenues of $3.2 million for the first quarter 2013, an increase of 73% versus the first quarter 2012 and an increase of 22% sequentially (compared to the fourth quarter 2012). In addition, the Company’s installed base of XTRAC® machines increased by 51 placements during the quarter, for a total of 401 in the U.S.
Similarly, 2012 saw a tremendous sales and marketing effort from PhotoMedex for the consumer no!no!™ products, which included several one-day “beauty events” on home shopping TV channels that earned record revenue, a drive to place the no!no!™ products at nearly every Bed Bath and Beyond store in the U.S. as well as a number of other global retailers, Spanish-language advertisements in the U.S., and increased marketing of no!no!™ Men. To get more traction out of these expenditures, the Company worked to upsell no!no!™ customers at call centers on the NEOVA® skin care products as well, leading to increased sales of this line too.
For the first quarter 2013, PhotoMedex reported consumer revenues, led by the no!no!™ products, of $49 million, a 16% increase over the first quarter 2012.
Profitability Increasing and Solid Cash Position
For the first quarter 2013, PhotoMedex’s gross margins increased from 77.7% in the first quarter 2012 to 79.3%.
The Company reported a net income for the period of $7.2 million, or $0.34 per diluted share, versus $4.9 million, or $0.26 per diluted share, for the year-ago quarter.
As of March 31, 2013, PhotoMedex had cash and cash equivalents of $63.5 million, or $3.00 per diluted share.
PhotoMedex, Inc. (PHMD-NASDAQ)
Earlier today, PhotoMedex announced financial results for its third quarter 2012 (ended September 30). The company reported revenues of $56.7 million, up 63% over the corresponding period in 2011, which PhotoMedex attributed to its supporting consumer marketing programs. Notably, revenues for the first nine months of 2012 exceeded annual revenues for all of 2011.
PhotoMedex’s gross profit for the current three-month period was $45.4 million, an increase of 71% versus the third quarter 2011. Net income for the third quarter 2012 was $7.5 million, a 77% rise versus the prior year’s period. The company reports that it has increased its margin with a focus on reducing costs (such as by using ocean freight) as well as consolidating manufacturing.
PhotoMedex recently held a 24-hour beauty event for its no!no! Hair™ removal device that broke home television shopping sales records in the U.S. Consumers purchased roughly 42,000 units for total sales of $10.5 million in 24 hours. Going forward, the company aims to expand its marketing efforts internationally for the no!no! family of products as well as in the U.S. for two additional products: (1) XTRAC® for the treatment of psoriasis; and (2) Neova® to help reverse the effects of sun-damaged skin.
Neonode Inc. (NEON-NASDAQ)
Neonode announced that its MultiSensing Touch Technology is featured in the newly released “Crema Touch” e-reader from Netronix and PAGEOne Tech Co., Ltd. The Crema Touch retails at $99 and was launched today to the Korean consumer market. It is one of only three e-reader products built on the 6-inch touch module manufactured by Netronix that is marketed and sold in Korea and Europe. The Korea Electronic Publishing Association estimated the Korean e-book market to be $260 million in 2011, with potential to double during 2013.
Neonode’s MultiSensing Touch Technology enabled an overlay-free design that is lightweight, thin, and consumes little power, with up to 400 hours of battery life on a single charge. These attributes are typical for all Neonode touch-enabled e-readers.
AtheroNova Inc. (AHRO-OTC)
AtheroNova appointed Fred Knoll, the principal and portfolio manager of Knoll Capital Management, to its Board of Directors (biography provided below). Mr. Knoll’s experience with emerging growth companies is expected to support AtheroNova as the Company prepares to commence Phase I clinical trials of its lead bile acid-based candidate, AHRO-001. AtheroNova expects to complete Phase I trials and file an IND with the FDA by the first quarter 2013, followed by a Phase II clinical study. In October 2012, AtheroNova completed a private placement for net proceeds of roughly $2 million, which the company expects to provide the capital necessary to fund Phase I and Phase II clinical trials.
Since 1987, Mr. Knoll has been the principal and portfolio manager at Knoll Capital Management, an investment company managing funds over the last two decades in areas such as emerging growth companies, restructurings, and China. During the 1980s and early 1990s, he was chairman of the Board of Directors of Telos Corporation, a computer systems integration company, served as investment manager for General American Investors, was the U.S. representative on investments in leveraged buyouts and venture capital for Murray Johnstone, Ltd. of Glasgow, UK , and headed the New York investment group of Robert Fleming, Inc., at the time, a leading UK merchant bank subsequently acquired by JP Morgan, managing a venture capital fund and the U.S. research team.
Mr. Knoll started his investment career as an investment analyst at Capital Research (Capital Group) in the early 1980s and held positions in sales and marketing with Wang Inc. and Data General and software engineering with Computer Sciences Corporation in the late 1970s.
Mr. Knoll holds a B.S. in electrical engineering and computer science from the Massachusetts Institute of Technology (MIT), a B.S. in management from the Sloan School at MIT, and an MBA from Columbia University in finance. He was also a member of the Columbia University International Fellows Program.
MONTGOMERYVILLE, Pa.--(BUSINESS WIRE)--May 10, 2012--
PhotoMedex, Inc. (PHMD-NASDAQ) reported financial results for the three months ended March 31, 2012. Financial highlights of the 2012 first quarter include:
- Revenues of $50.3 million, an increase of 45% compared with the prior-year first quarter and an increase of 75% sequentially
- Consumer revenues of $42.2 million, an increase of 26% compared with the prior-year first quarter and an increase of 63% sequentially
- Gross profit of $39.0 million, an increase of 37% or $10.5 million compared with the first quarter of 2011
- Gross margin of 77.7% compared with 82.1% in the prior-year first quarter, reflecting the inclusion of revenues from the pre-merged PhotoMedex
- Income before taxes, litigation expense and one-time expenses of $7.8 million, net income of $4.9 million
- Litigation and one-time expenses of $2.7 million
- Adjusted income of $10.7 million or $0.56 per diluted share
On December 13, 2011, Radiancy, Inc. became a majority owned subsidiary of PhotoMedex in a reverse merger. In accordance with generally accepted accounting principles (GAAP), Radiancy is deemed to be the financial acquirer for financial statement purposes and therefore the related consolidated statements of operations for the periods prior to December 31, 2011, do not include activity from the pre-merged PhotoMedex prior to the date of merger.
Reported Financial Results
Revenues for the first quarter 2012 were $50.3 million, an increase of 45% over the same period last year. Included in this amount is $7.1 million in revenues from pre-merged PhotoMedex. This compares with revenues for the first quarter 2011 of $34.7 million, which included no revenues from pre-merged PhotoMedex.
Net income for the first quarter of 2012 was $4.9 million, or $0.26 per diluted per share, which included $1.8 million in stock-based compensation expense, $1.3 million in depreciation and amortization expenses, $1.8 million in litigation expenses, and $0.5 million in other one-time charges. This compares with net income for the first quarter 2011 of $8.1 million, or $0.68 per diluted share, which included $0.1 million in stock-based compensation expense, $0.1 million in depreciation and amortization expenses and $0.7 million in litigation expenses.
As of March 31, 2012, the Company had cash and cash equivalents of $23.5 million. On April 27, 2012, the Company raised $40.0 million in gross proceeds from concurrent registered offerings of 3,023,432 shares of Common Stock, yielding net proceeds of $37.8 million.
On a pro forma basis, had the merger been completed on January 1, 2011, revenues for the three months ended March 31, 2011, would have been $42.9 million, gross profit would have been $32.1 million, and net income would have been $6.3 million.
About PhotoMedex, Inc.
PhotoMedex is a global skin health company providing integrated disease management and aesthetic solutions to dermatologists, professional aestheticians, and consumers. The company provides proprietary products and services that address skin diseases and conditions including psoriasis, vitiligo, acne, actinic keratosis (a precursor to certain types of skin cancer), and photo damage. Its experience in the physician market provides the platform to expand its skin health solutions to spa markets, as well as traditional retail, online, and infomercial outlets for home-use products. As a result of its December 2011 merger with Radiancy Inc., PhotoMedex has added a range of home-use devices under the no!no!™ brand, for various indications including hair removal, acne treatment, and skin rejuvenation. The company also offers a professional product line for acne clearance, skin tightening, psoriasis care, and hair removal sold to physician clinics and spas.
Greater information about PhotoMedex and its product portfolio is provided in Crystal Research Associates' 60-page Executive Informational Overview (EIO).
PhotoMedex's Financial statements, Safe Harbor Statement, and other information is provided in the original press release.
PHMD Closes $40 Million Stock Offering
Today, global skin health company PhotoMedex, Inc. (PHMD-NASDAQ) announced the closing of concurrent registered offerings of over 3 million shares of its common stock at $13.23 per share for expected gross proceeds of roughly $40 million (before underwriting discounts, commissions, and other offering expenses). PhotoMedex plans to use the net proceeds to support capital expenditures, continued product development, sales and marketing initiatives, and working capital. The full press release is available here.
Pursuing Dual Listing on the Tel-Aviv Stock Exchange
As well, PhotoMedex announced plans to file an application to register its shares of common stock for dual listing on the Tel-Aviv Stock Exchange (TASE) in addition to its listing on the NASDAQ Global Select Market.
UPDATE: PhotoMedex announced that its application was accepted on May 1, 2012, and commenced trading on the TASE under the symbol "PHMD" on May 3, 2012.
"We believe that listing the Company’s shares on the TASE will provide additionalexposure to the Israeli investment community, and thus will increase interest inPhotoMedex among Israel’s large and sophisticated institutional investors, increasetrading volume if PhotoMedex’s ordinary shares are included in the various TASEindices, as well as provide trading access for European investors during regularEuropean business hours." ~ Dr. Dolev Rafaeli, PhotoMedex's Chief Executive Officer
First Quarter 2012 Conference Call
PhotoMedex is scheduled to release its first quarter financial results on Thursday, May 10, 2012. Information for the corresponding conference call is available below.
Date: May 10, 2012
Time: 4:30 p.m. ET
Dial-in Number: (888) 778-8904 (toll-free) or (913) 312-0961 (toll/international)
Confirmation Code: 6862422
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Crystal Research Associates has just issued a report on PhotoMedex Inc., a global skin health company addressing a worldwide aesthetic industry valued at roughly $34 billion annually. Closely held Radiancy® Inc. and publicly traded PhotoMedex Inc. merged in December 2011, whereby Radiancy became a majority-owned subsidiary of PhotoMedex. Each company emphasizes the development of physician-endorsed skin care products based on science. Upon receiving clearance for use, these products are commercialized through a systematic, proprietary marketing programs that are fundamental to business success and growth.
89% Year over Year Revenue Growth Reported Yesterday
Reflecting successful marketing strategies, on March 8, 2012, PhotoMedex reported revenues of over $132 million for the year ended December 31, 2011—an 89% increase over 2010. This included $1.5 million from operations of pre-merged PhotoMedex, representing its activities from December 13, 2011 (the date of merger with Radiancy) to December 31, 2011. On a proforma basis, combined 2011 company revenues were $162.3 million. Radiancy’s 2010 sales were $70 million. As of December 31, 2011, the Company held cash and cash equivalents of $16.5 million.
The Company provides dermatologists, professional aestheticians, and consumers with the equipment and skin care products they need to treat specific skin conditions, such as psoriasis, vitiligo, acne, and UV damage, among others. The recent marriage with Radiancy® Inc. brings to PhotoMedex the no!no!® line of home-use consumer products for hair removal, as well as acne treatment and skin rejuvenation. Radiancy further markets capital equipment to physicians, salons, and med spas for hair removal, acne treatment, skin tightening and rejuvenation, and psoriasis care.
You've likely seen ads for one of their more well-known products: the no!no!® Hair Removal 8800™ (no!no! brands also target at-home acne treatment and skin rejuvination).
The no!no! Hair Removal 8800™ was demonstrated on The Dr. Oz Show.
Radiancy possesses a proprietary consumer marketing engine built upon direct-to-consumer sales and creative marketing programs that drive brand awareness. During 2012, PhotoMedex expects to benefit from the impact of these marketing methodologies and expertise on its XTRAC® Excimer Laser and NEOVA® topical skin care lines while continuing to realize organic and geographic growth of additional brands. XTRAC received an FDA clearance in 2000 and has since become a widely recognized treatment among dermatologists for psoriasis and other skin conditions for which there are no cures. The NEOVA line of topical formulations is designed to prevent premature skin aging due to UV-induced DNA damage.
Their NEOVA® skin care line was demonstrated on The Doctors.
The Company has a rapidly expanding global presence that includes a 48-person direct sales force in the U.S., specialty distributors and retail venues in over 55 countries, online sales, product carried on home shopping TV channels, Company-owned stores/kiosks in certain countries, and targeted infomercials and print media disseminated worldwide.
Some of the magazines where the Company's products have appeared...
PhotoMedex's leadership is skilled in consumer, physician, and professional product development and sales, in particular, marketing professional aesthetics devices made for consumers. Management is supported by an experienced Board of Directors and a comprehensive Scientific Advisory Board, whose members bring broad dermatological and aesthetic medical expertise to PhotoMedex.
PhotoMedex (PHMD-NASDAQ) ended the day (March 9th) $1.24 (10.48%) at $13.07.