Exactech Inc. (EXAC, Financial) filed Quarterly Report for the period ended 2009-09-30.
Exactech develops and markets orthopaedic implant devices related surgical instruments and biologic materials and services to hospitals and physicians. The company manufactures many of its orthopaedic devices at its Gainesville facility. Exactech's orthopaedic products are used in the restoration of bones and joints that have deteriorated as a result of injury or diseases such as arthritis. Exactech Inc. has a market cap of $202.4 million; its shares were traded at around $15.83 with a P/E ratio of 15.4 and P/S ratio of 1.2. Exactech Inc. had an annual average earning growth of 12.2% over the past 5 years.
During the nine months ended September 30, 2009, sales increased 6% to $129.0 million from $121.4 million in the comparable nine months ended September 30, 2008, as we experienced some expansion in the market, which was partially offset by the effect of foreign currency fluctuations and the current economic downturn. Gross margins increased to 64.2% from 63.1% as a result of continued growth in our domestic sales with higher margins as well as the impact of lower product costs with more components being manufactured internally. Operating expenses increased 12% from the nine month period ended September 30, 2008, and as a percentage of sales, operating expenses increased to 54% during the first nine months of 2009 as compared to 52% for the same period in 2008. This increase was partially due to $3.4 million in legal and other expenses related to the DOJ inquiry. We also incurred additional sales and marketing expenses and depreciation and amortization expenses as a result of our
acquisitions during 2008. Net income for the nine months ended September 30, 2009 decreased 2% to $7.8 million and diluted earnings per share were $0.61 as compared to $0.63 last year. Net income for the nine months was also affected by the DOJ inquiry, which had a net of tax impact of $2.1 million on net income and $0.16 effect on earnings per share. Excluding the impact of the DOJ inquiry costs, net income increased 7% to $10.0 million.
During the nine months ended September 30, 2009, we acquired $12.8 million in property and equipment, including new production equipment, surgical instrumentation, and facility expansion. Cash flow from operations was $20.3 million for the nine months ended September 30, 2009 as compared to a net cash flow from operations of $2.5 million during the nine months ended September 30, 2008.
For the quarter ended September 30, 2009, total sales increased 12% to $42.4 million from $37.9 million in the comparable quarter ended September 30, 2008. Sales of knee implant products increased 4% to $17.3 million during the third quarter of 2009 from $16.6 million for the quarter ended September 30, 2008. We believe this increase is partially a result of sequential improvement in same customer surgical volumes as well as adding new customers. Hip implant sales of $6.8 million during the quarter ended September 30, 2009 were an increase of 24% over the $5.5 million in sales during the quarter ended September 30, 2008, primarily due to the continued success of our Novation® hip products. Sales from biologics and spine increased 7% during the quarter ended September 30, 2009 to $6.5 million, up from $6.1 million in the comparable quarter in 2008, due to the continued growth and market penetration from our Optecure® service and the Accelerate platelet concentrating system. Sales of our extremity products were up 31% to $5.5 million as compared to $4.2 million for the same period in 2008, as we continue to see increasing market acceptance of our Equinoxe® shoulder system, including the reverse product line extension. Sales of all other products increased to $6.3 million as compared to $5.5 million in the same quarter last year. Domestically, total sales increased 15% to $30.2 million, or 71% of total sales, during the quarter ended September 30, 2009, up from $26.3 million, which represented 69% of total sales, in the comparable quarter last year. Internationally, total sales increased 5% to $12.2 million, representing 29% of total sales, for the quarter ended September 30, 2009, as compared to $11.6 million, which was 31% of total sales, for the same quarter in 2008.
For the nine months ended September 30, 2009, total sales increased 6% to $129.0 million from $121.4 million in the comparable nine months ended September 30, 2008. Sales of knee implant products decreased 2% to $54.7 million during the nine months ended September 30, 2009, compared to $55.6 million for the same period in 2008, which we believe is partially due to a decrease in the volume of elective surgical procedures due to the economic downturn. Hip implant sales of $20.0 million during the nine months ended September 30, 2009 were an increase of 14% over the $17.5 million in sales during the nine months ended September 30, 2008, due to the continued momentum of our Novation® hip product line. Sales from biologics and spine increased 5% during the nine months ended September 30, 2009 to $20.5 million, up from $19.4 million in
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Exactech develops and markets orthopaedic implant devices related surgical instruments and biologic materials and services to hospitals and physicians. The company manufactures many of its orthopaedic devices at its Gainesville facility. Exactech's orthopaedic products are used in the restoration of bones and joints that have deteriorated as a result of injury or diseases such as arthritis. Exactech Inc. has a market cap of $202.4 million; its shares were traded at around $15.83 with a P/E ratio of 15.4 and P/S ratio of 1.2. Exactech Inc. had an annual average earning growth of 12.2% over the past 5 years.
Highlight of Business Operations:
During the quarter ended September 30, 2009, sales increased 12% to $42.4 million from $37.9 million in the comparable quarter ended September 30, 2008, as we experienced a return to procedural volume growth as compared to what we experienced in the prior two quarters. Gross margins improved slightly to 64.0% from 63.9% as a result of increased domestic sales with higher gross margins. Operating expenses increased 12% from the quarter ended September 30, 2008, and as a percentage of sales, operating expenses remained stable at 54% during each of the three quarters ended September 30, 2009 and 2008. This increase was primarily due to higher expenditures for research and development and product launches. Net income for the quarter ended September 30, 2009 increased 28% and diluted earnings per share were $0.21 as compared to $0.16 during the third quarter last year.During the nine months ended September 30, 2009, sales increased 6% to $129.0 million from $121.4 million in the comparable nine months ended September 30, 2008, as we experienced some expansion in the market, which was partially offset by the effect of foreign currency fluctuations and the current economic downturn. Gross margins increased to 64.2% from 63.1% as a result of continued growth in our domestic sales with higher margins as well as the impact of lower product costs with more components being manufactured internally. Operating expenses increased 12% from the nine month period ended September 30, 2008, and as a percentage of sales, operating expenses increased to 54% during the first nine months of 2009 as compared to 52% for the same period in 2008. This increase was partially due to $3.4 million in legal and other expenses related to the DOJ inquiry. We also incurred additional sales and marketing expenses and depreciation and amortization expenses as a result of our
acquisitions during 2008. Net income for the nine months ended September 30, 2009 decreased 2% to $7.8 million and diluted earnings per share were $0.61 as compared to $0.63 last year. Net income for the nine months was also affected by the DOJ inquiry, which had a net of tax impact of $2.1 million on net income and $0.16 effect on earnings per share. Excluding the impact of the DOJ inquiry costs, net income increased 7% to $10.0 million.
During the nine months ended September 30, 2009, we acquired $12.8 million in property and equipment, including new production equipment, surgical instrumentation, and facility expansion. Cash flow from operations was $20.3 million for the nine months ended September 30, 2009 as compared to a net cash flow from operations of $2.5 million during the nine months ended September 30, 2008.
For the quarter ended September 30, 2009, total sales increased 12% to $42.4 million from $37.9 million in the comparable quarter ended September 30, 2008. Sales of knee implant products increased 4% to $17.3 million during the third quarter of 2009 from $16.6 million for the quarter ended September 30, 2008. We believe this increase is partially a result of sequential improvement in same customer surgical volumes as well as adding new customers. Hip implant sales of $6.8 million during the quarter ended September 30, 2009 were an increase of 24% over the $5.5 million in sales during the quarter ended September 30, 2008, primarily due to the continued success of our Novation® hip products. Sales from biologics and spine increased 7% during the quarter ended September 30, 2009 to $6.5 million, up from $6.1 million in the comparable quarter in 2008, due to the continued growth and market penetration from our Optecure® service and the Accelerate platelet concentrating system. Sales of our extremity products were up 31% to $5.5 million as compared to $4.2 million for the same period in 2008, as we continue to see increasing market acceptance of our Equinoxe® shoulder system, including the reverse product line extension. Sales of all other products increased to $6.3 million as compared to $5.5 million in the same quarter last year. Domestically, total sales increased 15% to $30.2 million, or 71% of total sales, during the quarter ended September 30, 2009, up from $26.3 million, which represented 69% of total sales, in the comparable quarter last year. Internationally, total sales increased 5% to $12.2 million, representing 29% of total sales, for the quarter ended September 30, 2009, as compared to $11.6 million, which was 31% of total sales, for the same quarter in 2008.
For the nine months ended September 30, 2009, total sales increased 6% to $129.0 million from $121.4 million in the comparable nine months ended September 30, 2008. Sales of knee implant products decreased 2% to $54.7 million during the nine months ended September 30, 2009, compared to $55.6 million for the same period in 2008, which we believe is partially due to a decrease in the volume of elective surgical procedures due to the economic downturn. Hip implant sales of $20.0 million during the nine months ended September 30, 2009 were an increase of 14% over the $17.5 million in sales during the nine months ended September 30, 2008, due to the continued momentum of our Novation® hip product line. Sales from biologics and spine increased 5% during the nine months ended September 30, 2009 to $20.5 million, up from $19.4 million in
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