IRIS International Inc. (IRIS, Financial) filed Quarterly Report for the period ended 2009-09-30.
IRIS International Inc based in Chatsworth Calif. is a leader in automated urinalysis technology with systems in major medical institutions throughout the world. The Company's Sample Processing business unit based in Westwood Mass. manufactures innovative centrifuges and blood analysis products. Advanced Digital Imaging Research LLC based near Houston Texas is the Company's imaging research and development subsidiary. The IRIS Molecular Diagnostics Subsidiary develops innovative ultra-sensitive diagnostics and sample processing products with applications in the urinalysis oncology and infectious disease markets. Iris International Inc. has a market cap of $184.7 million; its shares were traded at around $10.28 with a P/E ratio of 22.3 and P/S ratio of 2.
Consolidated revenues for the nine months ended September 30, 2009 decreased by 4% over the prior year period. Revenues in the IVD urinalysis segment decreased 5% to $55.4 million in 2009 from $58.4 million in the prior year period. Sales of IVD instruments decreased to $16.8 million from $24.1 million during the prior year period. International revenues accounted for approximately 34% of consolidated revenue during the nine months ended September 30, 2009 compared to 32% during the prior year period. IVD consumables and service revenue increased to $38.7 million from $34.3 million, an increase of $4.4 million or 13% over the prior year period. Revenues for the first nine months of 2009 and 2008 from the sample processing segment increased by 3% to $10.7 million in 2009 as compared to $10.4 million in the prior year period.
Overall gross profit margins for the first nine months increased to 53% during the current year period compared to 52% for the 2008 period. The gross profit margin of our IVD instruments decreased to 36% in the current year period compared to 45% during the prior year. IVD instrument gross margin was impacted by $266,000 in sales promotions, $988,000 in costs related to the iChem VELOCITY, which included Velocity retrofit costs of $393,000, and severance costs of approximately $40,000. The IVD instruments gross margin was also affected by a high proportion of international sales which typically carry a lower gross margin as they are primarily sold through distributors. The gross margin of our IVD consumables and services increased to 61% during the first nine months of 2009 compared to 57% during the prior year period, and included approximately $291,000 in international sales discounts and $100,000 in severance costs. The improvement in IVD gross margin is primarily due to strong demand for urinalysis consumables and improvements in service profitability. Gross profit margin for our sample processing segment increased to 52% in 2009 from 50% in 2008, as a result of product mix, price increases and reduced headcount related to the reduction in force in the second quarter of 2009.
Marketing and selling expenses totaled $11.7 million, or 18% of revenue, for the first nine months, as compared to $11.9 million, or 17% of revenue, in the same period of 2008. The increase in additional personnel and related costs of $505,000 and other expenses of $66,000 were offset by lower commissions and GPO fees of $505,000, outside professional services of $115,000 and travel related expenses of $200,000.
Operating Cash Flows. Cash provided by operations for the nine months ended September 30, 2009 improved to $9.6 million compared to cash provided by operations of $8.6 million during the prior year nine month period. The improvement includes non-cash items consisting of higher depreciation and amortization of $223,000, stock-based compensation expense of $1.0 million, and tax benefits from stock options exercises of $1.5 million. In addition, we experienced a $2.6 million reduction in accounts receivable, a $1.5 million reduction in prepaid expenses and other current assets primarily due to a nonrecurring $1.5 million payment from IDEXX Labs, Inc. under the December 2008 manufacturing, supply and transition agreement, and a $143,000 reduction in investment in sales-type leases. The sources of cash were partially offset by a $1.3 million decrease in net income, an increase of $684,000 of deferred taxes, an increase of $1.7 million in inventories, and a decrease in accounts payable and accrued expenses of $2.1 million as compared to the prior year nine month period.
Financing Activities. Cash used in financing activities totaled $2.5 million during the first nine months of 2009, a $896,000 decrease over the first nine months of the prior year primarily as a result of the reduction in the repurchase of common stock amounting to $4.3 million partially offset by a decrease from the issuance of common stock of $749,000 and a reduction in tax deduction benefits from the exercise of stock options of $2.7 million compared to the prior first nine months of 2008.
Read the The complete Report
IRIS International Inc based in Chatsworth Calif. is a leader in automated urinalysis technology with systems in major medical institutions throughout the world. The Company's Sample Processing business unit based in Westwood Mass. manufactures innovative centrifuges and blood analysis products. Advanced Digital Imaging Research LLC based near Houston Texas is the Company's imaging research and development subsidiary. The IRIS Molecular Diagnostics Subsidiary develops innovative ultra-sensitive diagnostics and sample processing products with applications in the urinalysis oncology and infectious disease markets. Iris International Inc. has a market cap of $184.7 million; its shares were traded at around $10.28 with a P/E ratio of 22.3 and P/S ratio of 2.
Highlight of Business Operations:
Marketing and selling expenses totaled $3.8 million, or 17% of revenues, during the third quarter of 2009 as compared to $4.2 million, or 18% of revenues, during the third quarter of 2008. The decrease was due to lower commissions and GPO fees of $250,000, travel and entertainment expenses of $75,000 and outside professional services of $85,000, offset by an increase in additional personnel and related costs of $100,000. The increase in personnel and related costs is the result of our previous investments to enhance our internal sales staff and global marketing support in order to support the long-term growth of our business. We expect to continue to invest in these areas to strengthen our global presence and support for the anticipated launches of our extensive product pipeline.Consolidated revenues for the nine months ended September 30, 2009 decreased by 4% over the prior year period. Revenues in the IVD urinalysis segment decreased 5% to $55.4 million in 2009 from $58.4 million in the prior year period. Sales of IVD instruments decreased to $16.8 million from $24.1 million during the prior year period. International revenues accounted for approximately 34% of consolidated revenue during the nine months ended September 30, 2009 compared to 32% during the prior year period. IVD consumables and service revenue increased to $38.7 million from $34.3 million, an increase of $4.4 million or 13% over the prior year period. Revenues for the first nine months of 2009 and 2008 from the sample processing segment increased by 3% to $10.7 million in 2009 as compared to $10.4 million in the prior year period.
Overall gross profit margins for the first nine months increased to 53% during the current year period compared to 52% for the 2008 period. The gross profit margin of our IVD instruments decreased to 36% in the current year period compared to 45% during the prior year. IVD instrument gross margin was impacted by $266,000 in sales promotions, $988,000 in costs related to the iChem VELOCITY, which included Velocity retrofit costs of $393,000, and severance costs of approximately $40,000. The IVD instruments gross margin was also affected by a high proportion of international sales which typically carry a lower gross margin as they are primarily sold through distributors. The gross margin of our IVD consumables and services increased to 61% during the first nine months of 2009 compared to 57% during the prior year period, and included approximately $291,000 in international sales discounts and $100,000 in severance costs. The improvement in IVD gross margin is primarily due to strong demand for urinalysis consumables and improvements in service profitability. Gross profit margin for our sample processing segment increased to 52% in 2009 from 50% in 2008, as a result of product mix, price increases and reduced headcount related to the reduction in force in the second quarter of 2009.
Marketing and selling expenses totaled $11.7 million, or 18% of revenue, for the first nine months, as compared to $11.9 million, or 17% of revenue, in the same period of 2008. The increase in additional personnel and related costs of $505,000 and other expenses of $66,000 were offset by lower commissions and GPO fees of $505,000, outside professional services of $115,000 and travel related expenses of $200,000.
Operating Cash Flows. Cash provided by operations for the nine months ended September 30, 2009 improved to $9.6 million compared to cash provided by operations of $8.6 million during the prior year nine month period. The improvement includes non-cash items consisting of higher depreciation and amortization of $223,000, stock-based compensation expense of $1.0 million, and tax benefits from stock options exercises of $1.5 million. In addition, we experienced a $2.6 million reduction in accounts receivable, a $1.5 million reduction in prepaid expenses and other current assets primarily due to a nonrecurring $1.5 million payment from IDEXX Labs, Inc. under the December 2008 manufacturing, supply and transition agreement, and a $143,000 reduction in investment in sales-type leases. The sources of cash were partially offset by a $1.3 million decrease in net income, an increase of $684,000 of deferred taxes, an increase of $1.7 million in inventories, and a decrease in accounts payable and accrued expenses of $2.1 million as compared to the prior year nine month period.
Financing Activities. Cash used in financing activities totaled $2.5 million during the first nine months of 2009, a $896,000 decrease over the first nine months of the prior year primarily as a result of the reduction in the repurchase of common stock amounting to $4.3 million partially offset by a decrease from the issuance of common stock of $749,000 and a reduction in tax deduction benefits from the exercise of stock options of $2.7 million compared to the prior first nine months of 2008.
Read the The complete Report
