Palomar Medical Technologies Inc. (PMTI, Financial) filed Annual Report for the period ended 2012-02-29.
Palomar Med Tec has a market cap of $191.23 million; its shares were traded at around $9.43 with and P/S ratio of 1.85.
Other revenues. Other revenues decreased by 48% in 2011 as compared to 2010. In 2011, other revenues of $2.2 million related to payments received under an amendment to our license agreement with P&G (“the License Agreement”) that was signed in the fourth quarter of 2010. The payments under the amended License Agreement are being recognized ratably through the expected launch term. In 2010, other revenues consisted of three quarterly payments of $1.25 million pursuant to a license agreement with P&G plus the recognition of $0.6 million of the $1.0 million payment pursuant to the amendment to the License Agreement with P&G in the fourth quarter.
Cost of royalty revenues. The cost of royalty revenues increased in absolute dollars, but decreased as a percentage of royalty revenues to 38% in 2011 from 40% in 2010. The increase in absolute dollars is mainly attributed to the royalty revenues received from Candela/Syneron as a result of the resolution of the patent infringement lawsuits against Syneron, Inc., Syneron Medical Ltd., and Candela Corporation. Excluding the effect of the royalty revenues received from Candela/Syneron of $11.1 million, cost of royalty revenues increased by 41% for the year ended December 31, 2011 as compared to the year ended December 31, 2010. We believe that the use of this non-GAAP cost of royalty revenues disclosure enhances our ability to conduct period-to-period analyses for our results. The increase is a result of an increase in on-going royalty payments from our licensees and a $1.1 million back-owed royalty payment in the first quarter of 2011.
Selling and marketing expense. Selling and marketing expense increased in absolute dollars, but decreased as a percentage of total revenues to 25% in 2011 from 31% in 2010. Excluding the effect of the $29.8 million in royalty revenues received from Candela/Syneron, selling and marketing expense increased as a percentage of total revenues to 35% in 2011 from 31% in 2010. We believe that the use of this non-GAAP selling and marketing expense disclosure enhances our ability to conduct period-to-period analyses for our results. Selling and marketing expenses relating to our Professional Product segment increased by 24% in 2011 as compared to 2010. The increase was primarily driven by increases of $2.1 million from our foreign subsidiaries in Germany and Spain that we established in 2011, $0.7 million in commissions due to higher revenues, and $0.7 million in higher payroll and payroll related expenses. Selling and marketing expenses related to our Consumer Product segment increased by 70% in 2011 over 2010. The increase was primarily driven by increases of $0.8 million in direct marketing expenses and $0.3 million in payroll and payroll related expenses.
Other revenues. Other revenues decreased by 14% in 2010 as compared to 2009. In 2010, other revenues of $4.3 million consisted of three quarterly payments of $1.25 million relating to a license agreement with P&G plus the recognition of $0.6 million of the $1.0 million payment related to an amendment to the license agreement with P&G which was signed in the fourth quarter of 2010. The payments under the amended license agreement are being recognized ratably through the expected launch term. In 2009, other revenues of $5.0 million consisted of four quarterly payments of $1.25 million relating to a license agreement with P&G.
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Palomar Med Tec has a market cap of $191.23 million; its shares were traded at around $9.43 with and P/S ratio of 1.85.
Highlight of Business Operations:
Royalty revenues. Royalty revenues increased by 546% in 2011 as compared to 2010. The increase was mainly attributable to the $29.8 million in royalty revenues we received from Candela/Syneron as a result of the resolution of the patent infringement lawsuits against Syneron, Inc., Syneron Medical Ltd., and Candela Corporation. The $29.8 million is compensation for back-owed royalties for sales of professional laser-and lamp-based systems beginning with Candela and Syneron s sales in August 2000 through September 30, 2011 plus estimated future royalties owed through the expiration of U.S. Patent 5,595,568 and 5,735,844 and corresponding foreign counterparts (“the Anderson Patents”) in February 2015. Excluding the $29.8 million, royalty revenues increased 41% for the year ended December 31, 2011 over the year ended December 31, 2010. We believe that the use of this non-GAAP revenues disclosure enhances our ability to conduct period-to-period analyses for our results. The increase is a result of an increase in on-going royalty payments from our licensees and a $1.1 million back-owed royalty payment in the first quarter of 2011.Other revenues. Other revenues decreased by 48% in 2011 as compared to 2010. In 2011, other revenues of $2.2 million related to payments received under an amendment to our license agreement with P&G (“the License Agreement”) that was signed in the fourth quarter of 2010. The payments under the amended License Agreement are being recognized ratably through the expected launch term. In 2010, other revenues consisted of three quarterly payments of $1.25 million pursuant to a license agreement with P&G plus the recognition of $0.6 million of the $1.0 million payment pursuant to the amendment to the License Agreement with P&G in the fourth quarter.
Cost of royalty revenues. The cost of royalty revenues increased in absolute dollars, but decreased as a percentage of royalty revenues to 38% in 2011 from 40% in 2010. The increase in absolute dollars is mainly attributed to the royalty revenues received from Candela/Syneron as a result of the resolution of the patent infringement lawsuits against Syneron, Inc., Syneron Medical Ltd., and Candela Corporation. Excluding the effect of the royalty revenues received from Candela/Syneron of $11.1 million, cost of royalty revenues increased by 41% for the year ended December 31, 2011 as compared to the year ended December 31, 2010. We believe that the use of this non-GAAP cost of royalty revenues disclosure enhances our ability to conduct period-to-period analyses for our results. The increase is a result of an increase in on-going royalty payments from our licensees and a $1.1 million back-owed royalty payment in the first quarter of 2011.
Selling and marketing expense. Selling and marketing expense increased in absolute dollars, but decreased as a percentage of total revenues to 25% in 2011 from 31% in 2010. Excluding the effect of the $29.8 million in royalty revenues received from Candela/Syneron, selling and marketing expense increased as a percentage of total revenues to 35% in 2011 from 31% in 2010. We believe that the use of this non-GAAP selling and marketing expense disclosure enhances our ability to conduct period-to-period analyses for our results. Selling and marketing expenses relating to our Professional Product segment increased by 24% in 2011 as compared to 2010. The increase was primarily driven by increases of $2.1 million from our foreign subsidiaries in Germany and Spain that we established in 2011, $0.7 million in commissions due to higher revenues, and $0.7 million in higher payroll and payroll related expenses. Selling and marketing expenses related to our Consumer Product segment increased by 70% in 2011 over 2010. The increase was primarily driven by increases of $0.8 million in direct marketing expenses and $0.3 million in payroll and payroll related expenses.
Other revenues. Other revenues decreased by 14% in 2010 as compared to 2009. In 2010, other revenues of $4.3 million consisted of three quarterly payments of $1.25 million relating to a license agreement with P&G plus the recognition of $0.6 million of the $1.0 million payment related to an amendment to the license agreement with P&G which was signed in the fourth quarter of 2010. The payments under the amended license agreement are being recognized ratably through the expected launch term. In 2009, other revenues of $5.0 million consisted of four quarterly payments of $1.25 million relating to a license agreement with P&G.
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