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Endologix Inc Reports Operating Results (10-Q)

August 03, 2012 | About:
10qk

10qk

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Endologix Inc (ELGX) filed Quarterly Report for the period ended 2012-06-30.

Endologix, Inc. has a market cap of $744.8 million; its shares were traded at around $11.85 with and P/S ratio of 8.9.

Highlight of Business Operations:

Gross margin for the three months ended June 30, 2012 decreased to 75.4% from 78.4% for the three months ended June 30, 2011. This decrease is primarily due to (i) royalty expenses which were not present in the prior year period and (ii) amounts recorded in the current year period to our provision for excess and obsolete inventory. These decreases were partially offset by a greater proportion of our current period revenue derived from our direct sales force, as opposed to distributor sales.

Marketing and Sales. The $2.7 million increase in marketing and sales expenses for the three months ended June 30, 2012, as compared to the prior year period, was primarily related to marketing costs to support the growth of our U.S. business, costs related to our direct sales force in Europe (which were not present in the prior year period), and an increase in variable compensation expense of $0.6 million due to an increase in U.S. revenue of 33.0%.

Marketing and Sales. The $5.3 million increase in marketing and sales expenses for the six months ended June 30, 2012, as compared to the prior year period, was primarily related to marketing costs to support the growth of our U.S. business, costs related to our direct sales force in Europe (which were not present in the prior year period), and an increase in variable compensation expense of $1.9 million due to an increase in U.S. revenue of 32.6%.

Our provision for income taxes was $0.5 million and our effective tax rate was 2% for the six months ended June 30, 2012. Our future effective income tax rate will depend on various factors, including profits (losses) before taxes, changes to tax law, and the geographic composition of our pre-tax income. Our effective income tax rate differs from the U.S. federal statutory tax rate of 35% primarily as a result of the mix of earnings between tax jurisdictions, nondeductible expenses, state income taxes, and our continuous evaluation of the realization of our deferred tax assets. During the six months ended June 30, 2012, we had operating legal entities in the U.S. and the Netherlands (including registered sales branches in certain countries in Europe). We had a single operating legal entity in the U.S. during the prior year period.

During the six months ended June 30, 2012 and 2011, our cash collections from customers totaled $46.9 million and $37.7 million, respectively, representing 94.0% and 99.8% of reported revenue for the same periods.

Read the The complete Report

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