Iridex Corp. has a market cap of $39.4 million; its shares were traded at around $4.45 with a P/E ratio of 15.3 and P/S ratio of 1. IRIX is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:Ophthalmology revenues increased 0.8% or $0.1million from $7.5 million to $7.6 million. Domestic ophthalmology systems increased $0.3 million, or 34.1%, from $0.8 million to $1.1 million. We have continued to see a return of customers willing to make capital equipment expenditures as the economic uncertainty diminishes. International ophthalmology systems increased $0.4 million, or 20.5%, from $1.9 million to $2.3 million. International demand remains strong across a broad array of countries helped by the recovering global economy. Ophthalmology recurring revenues consisting of consumables and service decreased $0.4 million, or 10.1%, from $4.4 million to $4.0 million, although we did see a recovery of $0.2 million or 4.1% over the preceding quarter. Recurring revenues may have been impacted by a reduction in procedure rates in 2009 and we may be seeing some recovery based on improving economic conditions. OEM revenues reduced to $0.2 million from $0.4 million. Our OEM revenue is generated from a long standing relationship and demand for the end user products is decreasing.
Aesthetics revenues in total remained constant at $3.2 million. International aesthetics system revenues increased $0.31 million or 42.4%, from $0.8 million to $1.1 million and domestic aesthetics system revenues decreased $0.2 million or 26.7%, from $0.8 million to $0.6 million. Service revenues decreased $0.2 million or 11.9%, from $1.6 million to $1.4 million. Aesthetics systems revenues fluctuate period to period due to the timing of individual deals because of the relatively high price and low volume of systems being sold. This effect is magnified for international sales where distributors often place multiple system orders at one time.
Gross profit for the quarter ended April 3, 2010 was $5.2 million compared with $5.0 million for the comparable quarter of the prior year, an increase of $0.2 million. This reflected an improvement of gross margins to 48.6% of revenues for the quarter ended April 3, 2010 compared with 47.0% of revenues for the same quarter a year earlier.
Research and development (R&D) expenses increased by $0.2 million or 22%, to $1.0 million from $0.8 million for the quarter ended April 3, 2010 compared to the same period of the prior year. R&D expenses increased due to increased consumption of project materials.
General and administrative expenses decreased by $0.2 million or 15.8%, to $1.3 million from $1.5 million for the quarter ended April 3, 2010 compared to the same period of the prior year. The decrease in general and administrative spending is primarily attributable to a reduction in professional fees. The decrease was partially offset by $0.1 million of acquisition costs incurred in the current quarter in conjunction with the acquisition of RetinaLabs, Inc.
As of April 3, 2010, we had cash and cash equivalents of $6.4 million and working capital of $14.3 million compared to $9.4 million and $13.2 million, respectively as of January 2, 2010. During the quarter the Company repaid amounts owed to Wells Fargo Bank and terminated the credit agreement. It is managements intention to enter into a new banking agreement in the near future.
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