American Medical Systems fourth quarter sales increase 0.7% to $147.0 million

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In anticipation of presenting at the JP Morgan Healthcare Conference on January 11, 2011, American Medical Systems Holdings, Inc. (NASDAQ: AMMD) reported today preliminary sales of $147.0 million for the fourth quarter of 2010, a 0.7 percent increase over sales of $146.0 million in the comparable quarter of 2009. The strengthening of the U.S. dollar compared to the fourth quarter of 2009 negatively affected revenue comparisons for the quarters by $1.6 million. Adjusting for the impact of foreign currency results in fourth quarter revenue growth of 1.7 percent over the same quarter last year. Further adjusting revenue for the impact of the Her Option® uterine health product line, which was sold during the first quarter of 2010, results in constant currency growth of 4.0 percent. The preliminary fourth quarter revenue of $147.0 million exceeds the Company's guidance issued on November 3, 2010, of $141 million to $146 million.

“We are particularly pleased to see a significant improvement in the U.S. growth rate which achieved 7.4% in the fourth quarter.”

Preliminary sales for the year 2010 were reported at $542.3 million, a 4.4 percent increase over sales of $519.3 million for the year 2009. The strengthening of the U.S. dollar for the full year 2010 compared to 2009 negatively affected revenue comparisons between years by $0.1 million. Further adjusting revenue for the impact of the Her Option® uterine health product line divestiture results in 2010 constant currency revenue growth of 5.9% over 2009.

Men's Health sales of $65.2 million in the fourth quarter, represented an increase of 2.7 percent on a reported basis compared to the same quarter last year, and grew 4.1 percent on a constant currency basis, with growth in the erectile restoration and male continence product lines roughly equal. The BPH Therapy business declined 2.1 percent on a reported basis and 1.0 percent on a constant currency basis, to $32.6 million for the quarter. BPH Therapy sales were led by an enthusiastic response to the new GreenLight™ XPS console, offset by a decline in fiber sales due to limited availability of the recently launched MoXy™ Liquid Cooled Fiber and challenging international markets. The Women's Health business increased 6.7 percent on a reported basis and 7.4 percent on a constant currency basis to $48.8 million in the fourth quarter. The female continence product line benefited from the recent introduction of the MiniArc® Precise Single-Incision Sling System for the treatment of female stress urinary incontinence, and the pelvic floor repair product line continued its strong performance driven by the success of both the Elevate® anterior and posterior systems.

"We are pleased to see notable year over year growth rate improvements across all three businesses versus third quarter performance," noted Tony Bihl, Chief Executive Officer. "We are particularly pleased to see a significant improvement in the U.S. growth rate which achieved 7.4% in the fourth quarter."

The Company reiterates its fourth quarter and full year 2010 non-GAAP adjusted earnings per share estimates in the ranges $0.35 to $0.38, and $1.24 to $1.27, respectively, which were provided on November 3, 2010. This guidance excludes the impact of the recently reinstated research and development tax credit, which is estimated to have a $0.01 per share favorable impact. The full year and fourth quarter guidance also exclude the per share impact of amortization of intangible assets of approximately $0.025 and $0.10 for the fourth quarter and full year 2010, respectively, and amortization of financing costs of approximately $0.025 and $0.11 for the fourth quarter and full year 2010, respectively. Guidance for both periods excludes the impact of any unusual non-recurring items, such as gain or loss on early debt extinguishments, sale of non-strategic assets or IPRD charges on milestone payments related to prior acquisitions.

Mr. Bihl further commented, "We look forward to sharing final financial results for the fourth quarter, along with our guidance for 2011, during our fourth quarter earnings call on February 15, 2011."

The Company will participate in the JP Morgan Healthcare Conference on Tuesday, January 11, 2011 in San Francisco. Tony Bihl, Chief Executive Officer, and Mark Heggestad, Chief Financial Officer, will present to attendees of the conference at 3:00 p.m. pacific time (6:00 p.m. eastern time). A live audio webcast of the presentation will be available to all interested parties at the Company's Investor Relations website at www.AmericanMedicalSystems.com.

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