ev3 Reports In-Line - Analyst Blog

ev3, Inc. (EVVV) recently reported fourth quarter and full fiscal 2009 results. For the fourth quarter, earnings per share were 12 cents, in line with the Zacks Consensus Estimate and higher than the year-ago loss of 2 cents. For fiscal 2009, earnings per share were 40 cents, higher than the loss of 45 cents in the year-ago quarter.

Quarterly results

Excluding the Merck research collaboration revenues, net sales increased 20% year over year to $126.8 million in the fourth quarter. Excluding a favorable foreign currency translation (FX), net sales increased 16% year over year.

Peripheral vascular sales increased 8% year over year to $73.7 million. Growth was led by higher demand for the company’s plaque excision; thrombectomy and embolic protection; and procedural support products. This was partly offset by lower revenues from stents.

Neurovascular sales increased 41% year over year to $53.0 million buoyed by higher sales of embolic; and neuro access and delivery products.

ev3 reported a gross margin expansion of 870 basis points (bps) year over year to 75.9%. Sales, general and administrative expenses as a percentage of sales declined 330 bps year over year to 46.9%. Research and development expenses as a percentage of sales declined 20 bps year over year to 10.0%.

Fiscal year results

Excluding the Merck research collaboration revenues, net sales increased roughly 12% year over year to $449.1 million in fiscal 2009. Peripheral vascular sales increased 4% year over year to $279.5 million. Neurovascular sales increased 28% year over year to $169.5 million.

Geographically, the U.S. contributed roughly 60% to total fiscal 2009 revenues and declined 2% year over year. International revenues increased 21% year over year.

Balance Sheet

ev3 ended fiscal 2009 with cash and cash equivalent of approximately $98.1 million, a sequential increase of $17.5 million. The company had an outstanding long-term debt of roughly $6.5 million at fiscal-end 2009.

Outlook

ev3 has provided earnings per share and sales guidance for both the first quarter and full fiscal 2010. For the first quarter, earnings per share are expected between 12 and 15 cents. Total revenues should be in the range of $115 to $118 million, an increase of 14 to 18% year over year. The diluted number of outstanding shares should be roughly 113.4 million.

For fiscal 2010, ev3 expects earnings per share between 78 and 84 cents. Total revenues should be in the range of $500 to $515 million, an increase of 11 to 15% year over year. The diluted number of outstanding shares should be roughly 114.1 million.

ev3 is a Plymouth, MN-based endovascular company that concentrates on catheter-based or endovascular technologies for the minimally invasive treatment of vascular diseases and disorders.

ev3 competes in the endovascular market with a number of large companies like Boston Scientific Corporation (BSX), Medtronic Inc. (MDT), C.R. Bard (BCR), and Cordis.