Wright Medical Group Inc. (WMGI, Financial) filed Quarterly Report for the period ended 2012-06-30.
Wright Medical Group, Inc. has a market cap of $772.4 million; its shares were traded at around $19.73 with a P/E ratio of 36.4 and P/S ratio of 1.5.
Our international sales decreased 5% to $54.1 million in the second quarter of 2012, compared to $57.2 million in the second quarter of 2011, as the Belgian stocking order was more than offset by a 12% decline in European sales, driven by lower levels of hip sales to our international stocking distributors, and a 12% decline in Japan driven primarily by pricing declines. Additionally, international sales were negatively impacted by $2.4 million due to unfavorable currency exchange rates.
totaled $69.2 million in the second quarter of 2012 and $75.4 million in the second quarter of 2011, a decline of 8%, and represented 56% and 57% of total net sales, respectively. Our international net sales totaled $54.1 million in the second quarter of 2012, compared to $57.2 million in the second quarter of 2011, representing a decline of 5%.
Our selling, general and administrative expenses as a percentage of net sales totaled 59.1% in the second quarter of 2012, compared to 53.4% in the second quarter of 2011. Selling, general and administrative expense for the second quarter of 2012 included $2.1 million of costs associated with the DPA (1.7% of net sales) and $2.8 million of non-cash, stock based compensation expense (2.3% of net sales). Selling, general and administrative expense for the second quarter of 2011 included $1.3 million of non-cash, stock based compensation expense (1.0% of net sales) and $2.4 million of costs associated with the DPA (1.8% of net sales). The remaining increase in selling, general and administrative expenses as a percentage of net sales is attributable to increased spending on foot and ankle medical education and relatively flat general and administrative expenses in relation to a lower level of sales.
Charges associated with the amortization of intangible assets totaled $1.3 million (1.0% of net sales) in the second quarter of 2012, as compared to $0.7 million (0.5% of net sales) in the second quarter of 2011. The increase is attributable to amortization expense associated with distributor non-compete agreements entered into during the second quarter of 2012. Based on the intangible assets held as of June 30, 2012, we expect to recognize amortization expense of approximately $4.9 million for the full year of 2012, $4.9 million in 2013, $3.2 million in 2014, $2.2 million in 2015, and $2.0 million in 2016.
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Wright Medical Group, Inc. has a market cap of $772.4 million; its shares were traded at around $19.73 with a P/E ratio of 36.4 and P/S ratio of 1.5.
Highlight of Business Operations:
Significant Quarterly Business Developments. Net sales decreased 7.0% in the second quarter of 2012 to $123.3 million, compared to net sales of $132.5 million in the second quarter of 2011 driven primarily by previously announced U.S. OrthoRecon customer losses, the impact of our 2011 agreement with KCI, and unfavorable currency rates. In the second quarter of 2012, we recorded net income of $0.7 million, a $5.4 million decrease compared to net income of $6.1 million for the second quarter of 2011, primarily due to lower sales, and increased non-cash, stock-based compensation and medical education expenses.Our international sales decreased 5% to $54.1 million in the second quarter of 2012, compared to $57.2 million in the second quarter of 2011, as the Belgian stocking order was more than offset by a 12% decline in European sales, driven by lower levels of hip sales to our international stocking distributors, and a 12% decline in Japan driven primarily by pricing declines. Additionally, international sales were negatively impacted by $2.4 million due to unfavorable currency exchange rates.
totaled $69.2 million in the second quarter of 2012 and $75.4 million in the second quarter of 2011, a decline of 8%, and represented 56% and 57% of total net sales, respectively. Our international net sales totaled $54.1 million in the second quarter of 2012, compared to $57.2 million in the second quarter of 2011, representing a decline of 5%.
Our selling, general and administrative expenses as a percentage of net sales totaled 59.1% in the second quarter of 2012, compared to 53.4% in the second quarter of 2011. Selling, general and administrative expense for the second quarter of 2012 included $2.1 million of costs associated with the DPA (1.7% of net sales) and $2.8 million of non-cash, stock based compensation expense (2.3% of net sales). Selling, general and administrative expense for the second quarter of 2011 included $1.3 million of non-cash, stock based compensation expense (1.0% of net sales) and $2.4 million of costs associated with the DPA (1.8% of net sales). The remaining increase in selling, general and administrative expenses as a percentage of net sales is attributable to increased spending on foot and ankle medical education and relatively flat general and administrative expenses in relation to a lower level of sales.
Charges associated with the amortization of intangible assets totaled $1.3 million (1.0% of net sales) in the second quarter of 2012, as compared to $0.7 million (0.5% of net sales) in the second quarter of 2011. The increase is attributable to amortization expense associated with distributor non-compete agreements entered into during the second quarter of 2012. Based on the intangible assets held as of June 30, 2012, we expect to recognize amortization expense of approximately $4.9 million for the full year of 2012, $4.9 million in 2013, $3.2 million in 2014, $2.2 million in 2015, and $2.0 million in 2016.
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