Syneron Medical Ltd. (NASDAQ: ELOS)
Recent highlights
-- Third consecutive quarter of gross margin improvement -- Return to positive cash flow from operating activities during the three-month period ending September 30, 2009 -- Sequential revenue growth in the seasonally weakest quarter -- DSOs fall for third consecutive quarter -- Inventories lowered for the third consecutive quarter -- Signed definitive agreement for merger transaction with Candela Corporation -- Completed acquisition of Primaeva Medical Inc.
Syneron Medical Ltd. (NASDAQ: ELOS), an innovator in the development, marketing and sales of elos™ combined-energy medical aesthetic devices, today announced financial results for the third quarter ended September 30, 2009.
Revenues for the third quarter of 2009 were $14.3 million, compared to revenues of $14.2 million in the second quarter of 2009, and revenues of $28.5 million for the third quarter of 2008.
Syneron's gross margins improved for the third consecutive quarter. Gross margins widened to 67% in the third quarter from 64.8% in the second quarter of 2009. Syneron's gross margin has risen by 12.3 percentage points since the fourth quarter of 2008.
Syneron recorded a net loss in the third quarter of $5.5 million on a GAAP basis which includes $0.7 million in stock-based compensation and approximately $1.2 million of expenses related to the merger of Syneron with Candela Corporation, announced on September 9, 2009. The third quarter net loss of $5.5 million compares to a similar net loss of $5.5 million in the second quarter of 2009 and a net profit of $2.2 million in the third quarter of 2008. The merger related expenses are included in the GAAP results in accordance with FASB statement number 141(R) "Business Combinations" which is effective for business combinations occurring after January 1, 2009. Syneron will continue to note merger related expenses on a quarterly basis until the transaction is completed.
On a non-GAAP basis, excluding stock-based compensation expenses, net loss in the third quarter was $4.8 million, compared to a net profit on a non-GAAP basis of $3.1 million in the third quarter of 2008.
GAAP EPS amounted this quarter to a loss of $0.20 per basic and diluted share, compared to a loss of $0.20 per basic and diluted share in the second quarter of 2009, and earnings per basic and diluted share of $0.08 in the third quarter of 2008. On a non-GAAP basis, the result for the third quarter is equivalent to a loss of $0.17 per basic and diluted share, compared to earnings per basic and diluted share on a non-GAAP basis of $0.11 in the third quarter of 2008.
Commenting on the results and developments in the third quarter, Syneron CEO Lou Scafuri said, "I am pleased with the results for the third quarter, especially the strong improvement in our gross margin during the past nine months, our return to a positive cash flow from operating activities, and the sequential improvement in revenue in the third quarter which, traditionally, is the weakest quarter for the aesthetic device sector. The continued improvement in the gross margin and the positive turn in cash flow from operations reflect, primarily, the success of deep company-wide restructuring, while the sequential increase in revenue, although modest, is evidence of physician acceptance of the new products we have introduced to the market since the start of the year. These sales figures are also encouraging because they support the indications of gradually improving demand for procedures and devices which we have begun receiving from our luminary doctors and major customers.