-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QTw2CvqSD26+KuH5LQ89hXWocscMf4pE6ZlFXJmsMxEBe2GD3oLookl482kC4XnJ 3TGZTtGipnwM2bF3eSTGYg== 0000947871-03-001700.txt : 20030724 0000947871-03-001700.hdr.sgml : 20030724 20030724093604 ACCESSION NUMBER: 0000947871-03-001700 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20030724 ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030724 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ORTHOFIX INTERNATIONAL N V CENTRAL INDEX KEY: 0000884624 STANDARD INDUSTRIAL CLASSIFICATION: SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-19961 FILM NUMBER: 03799555 BUSINESS ADDRESS: STREET 1: 7 ABRAHAM DE VEERSTRAAT STREET 2: CURACAO CITY: NETHERLANDS ANTILLES STATE: P8 ZIP: 00000 8-K 1 f8k_072403.txt CURRENT REPORT UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ----------------------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 ----------------------------- Date of Report (Date of earliest event reported): July 24, 2003 Orthofix International N.V. (Exact name of Registrant as specified in its charter) Netherlands Antilles 0-19961 N/A (State or other jurisdiction Commission File Number (I.R.S. Employer of incorporation) Identification Number) ----------------------------- 7 Abraham de Veerstraat Curacao Netherlands Antilles 011-59-99-465-8525 (Address of principal executive offices and telephone number, including area code) ----------------------------- Item 9. Regulation FD Disclosure (and information furnished under Item 12). - -------------------------------------------------------------------------- The following information is furnished pursuant to Item 9, "Regulation FD Disclosure" and Item 12, "Results of Operations and Financial Condition." On July 24, 2003, Orthofix International N.V. ("Orthofix") issued a press release announcing, among other things, its results of operations for the quarter ended June 30, 2003. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein. In addition, Orthofix announced in its press release dated July 24, 2003 that, excluding litigation costs of $1.3 million related to the KCI patent infringement case, net income for the second quarter ended June 30, 2003 would have been $7.8 million, or $0.53 per share. For the six months ended June 30, 2003, net income, excluding KCI litigation costs of $2.2 million, would have been $14.6 million, or $1.00 per share. Orthofix believes that this net income measure, excluding KCI litigation costs, is a useful proxy for Orthofix's results from operations because Orthofix did not incur any KCI related litigation costs in the second quarter of 2002 or for the six months ended June 30, 2002. Exhibit ------- 99.1 Press release of Orthofix International N.V. dated July 24, 2003 Signature Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: July 24, 2003 ORTHOFIX INTERNATIONAL N.V. By: /s/ Thomas Hein ------------------------------- Name: Thomas Hein Title: Chief Financial Officer EX-99.1 3 ex99-1_072403.txt PRESS RELEASE Exhibit 99.1 [ORTHOFIX LOGO] For Further Information: - ----------------------- Charles W. Federico Thomas Hein Group President & CEO CFO Orthofix International N.V. Orthofix International N.V. 704.948.2600 704.948.2600 Orthofix Reports Record Second Quarter Sales of $51.6 Million; an Increase of 13% HUNTERSVILLE, N.C., July 24, 2003 - Orthofix International N.V. (NASDAQ:OFIX) today announced results for the second quarter ended June 30, 2003. For the three months ended June 30, 2003, sales were a record $51.6 million, an increase of 13% over the $45.6 million reported during the same period in 2002. The positive impact of foreign currency on sales for the quarter was $2.2 million. Net income for the second quarter ended June 30, 2003, was $6.5 million, or $0.44 per share, compared with $6.8 million, or $0.45 per share, for the same period in 2002. Net income for the second quarter ended June 30, 2003, included $1.3 million in litigation costs related to the KCI patent infringement case. Excluding these litigation costs, net income for the second quarter ended June 30, 2003, would have been $7.8 million, or $0.53 per share, an increase of 15% over the same period of the prior year. Diluted weighted average shares outstanding were 14,753,417 and 15,080,655 during the three months ended June 30, 2003, and June 30, 2002, respectively. For the six months ended June 30, 2003, sales were $99.7 million, an increase of 14% over the $87.2 million reported during the same period in 2002. The positive impact of foreign currency on sales for the six month period was $4.1 million. Net income for the six months ended June 30, 2003, was $12.4 million, or $0.85 per share, compared with $13.4 million, or $0.89 per share, for the same period in 2002. Net income for the six months ended June 30, 2003, included $2.2 million in litigation costs related to the KCI patent infringement case. Excluding KCI litigation costs, net income for the six months ended June 30, 2003, would have been $14.6 million, or $1.00 per share, an increase of 9% over the same period of the prior year. Diluted weighted average shares outstanding were 14,628,146 and 15,031,153 for the six months ended June 30, 2003, and June 30, 2002, respectively. Charlie Federico, President and Chief Executive Officer, stated, "We continued to experience strong growth in our core businesses of orthopedic devices and stimulation, which grew 15% and 16%, respectively, in the second quarter over the same period of the prior year and which year-to-date have grown 16% and 15%, respectively, compared with the same period of the prior year. Our vascular business has grown 11% year-to-date over the same period of the prior year. Our Americas business continued its good growth, totaling $34.5 million, or 67% of total sales, for the second quarter, an increase of 9% for the second quarter and year-to-date over the same periods of the prior year. International sales, including the positive effect of foreign currency, increased 22% for the second quarter and 27% year-to-date over the same periods in 2002. Further, during the second quarter, the OrthoRx joint venture made additional progress by increasing revenues and reducing start-up losses. Orthofix made a further investment in the joint venture of $1.5 million during the second quarter, which was matched by our new partner, Ferrer Freeman and Company, following their purchase of HealthSouth's investment in the joint venture." Net sales by geographic destination for the periods ended June 30, (In millions)
Three Months Ended June 30, Six Months Ended June 30, --------------------------------------- --------------------------------------- 2003 2002 % Increase 2003 2002 % Increase ---------- ---------- -------------- ----------- ---------- -------------- Americas $ 34.5 $ 31.6 9% $ 65.7 $ 60.4 9% International 17.1 14.0 22% 34.0 26.8 27% ---------- ---------- -------------- ----------- ---------- -------------- Total $ 51.6 $ 45.6 13% $ 99.7 $ 87.2 14% ========== ========== ============== =========== ========== ==============
Net sales by product group for the periods ended June 30, (In millions)
Three Months Ended June 30, Six Months Ended June 30, ----------------------------------------- ----------------------------------------- 2003 2002 % Increase 2003 2002 % Increase ---------- ---------- --------------- ----------- ----------- --------------- Orthopedic Devices $ 16.4 $ 14.2 15% $ 31.6 $ 27.2 16% Stimulation 23.7 20.4 16% 44.8 39.1 15% Vascular (DVT) 5.8 5.7 2% 11.8 10.6 11% ---------- ---------- --------------- ----------- ----------- --------------- Total Orthopedic 45.9 40.3 14% 88.2 76.9 15% Non-Orthopedic 5.7 5.3 8% 11.5 10.3 12% ---------- ---------- --------------- ----------- ----------- --------------- Total $ 51.6 $ 45.6 13% $ 99.7 $ 87.2 14% ========== ========== =============== =========== =========== ===============
Gross profit margin for the second quarter was 75% compared with 74% for the same period of the prior year, reflecting the favorable impact of higher stimulation sales, partially offset by the negative foreign currency impact from foreign production of external fixation and vascular products, a significant portion of which are sold in US dollars. Year-to-date gross profit margin of 74% compared with 75% for the same period of the prior year reflects the negative currency impact on gross margins of foreign produced products sold in US dollars described above. Operating income as a percent of sales was 20% for the quarter and year-to-date compared with 25% for the same periods of the prior year. The decrease is primarily attributable to higher operating expenses resulting from KCI litigation costs, negative foreign currency impact on operating expenses, and higher sales and marketing expenses including higher commissions on stimulation sales and the cost of adding new sales people, launching the new PC.C.P product, and training and education of surgeons and sales force as products are introduced worldwide. The Company's effective tax rate for the three and six month periods ended June 30, 2003, was negatively impacted 4.0% and 3.5%, respectively, due to KCI legal expenses incurred in a low tax jurisdiction. Orthofix International N.V. is an international corporation, which develops, produces and markets innovative products in the medical device sector. Its products include Spinal-Stim(R) Lite for the enhanced healing of spinal fusions, the Orthotrac Pneumatic Vest(R) for chronic low back pain, the EZBrace LSO(R) for spine stabilization, the Physio-Stim(R) Lite for the healing of un-united fractures, the OSCAR(R) ultrasonic bone cement removal system for hip revision procedures, the A-V Impulse System(R) for enhancing venous circulation, the Orthofix(R) external fixation range for fractures and limb reconstruction, and the Orthofix ISKD(R) internal lengthener. For more information, please visit our corporate website at http://www.orthofix.com. - ----------------------- Certain of the matters discussed in this news release are forward-looking statements that involve risks and uncertainties, including, without limitation, the acceptance of new products in the market and the impact of competitive products and other risks and uncertainties. These are detailed from time to time in the Company's SEC filings (including its Annual Report on Form 10-K for the year ended December 31, 2002 and Quarterly Reports on Form 10-Q) and the Company's quarterly press releases. This news release, together with any information that would be required under Regulation G, will be available in the "Press Release" section of the Company's website specified above. - Financial tables follow - ORTHOFIX INTERNATIONAL N.V. CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited, U.S. Dollars, in thousands, except per share and share data)
For the three months For the six months --------------------------------- --------------------------------- ended June 30, ended June 30, --------------------------------- --------------------------------- 2003 2002 2003 2002 --------------- --------------- -------------- ---------------- Net sales $ 51,565 $ 45,580 $ 99,746 $ 87,175 Cost of sales 13,009 11,840 25,595 21,751 --------------- --------------- -------------- ---------------- Gross profit 38,556 33,740 74,151 65,424 --------------- --------------- -------------- ---------------- Operating expenses Sales and marketing 19,507 15,666 37,107 30,752 General and administrative 5,118 4,640 10,099 8,784 Research and development 2,128 1,971 4,258 4,103 Amortization 119 147 397 312 KCI litigation costs 1,264 -- 2,126 -- --------------- --------------- -------------- ---------------- 28,136 22,424 53,987 43,951 --------------- --------------- -------------- ---------------- Operating income 10,420 11,316 20,164 21,473 Other income (expense) 24 (661) (302) (936) --------------- --------------- -------------- ---------------- Net income before income tax 10,444 10,655 19,862 20,537 and minority interests Income tax expense (3,949) (3,406) (7,414) (6,311) --------------- --------------- -------------- ---------------- Net income before minority interests 6,495 7,249 12,448 14,226 Minority interests -- (473) -- (861) --------------- --------------- -------------- ---------------- Net income $ 6,495 $ 6,776 $ 12,448 $ 13,365 --------------- --------------- -------------- ---------------- Net income per common share - diluted $ 0.44 $ 0.45 $ 0.85 $ 0.89 Weighted average number of common shares outstanding - diluted 14,753,417 15,080,655 14,628,146 15,031,153
ORTHOFIX INTERNATIONAL N.V. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited, U.S. Dollars, in thousands)
As of As of ----------------- ---------------- June 30, December 31, ----------------- ---------------- 2003 2002 ----------------- ---------------- Assets Current assets: Cash and cash equivalents $ 38,684 $ 48,813 Trade accounts receivable 60,214 54,654 Inventory 23,730 23,471 Deferred income taxes 3,271 3,271 Prepaid expenses and other 5,778 6,789 ----------------- ---------------- Total current assets 131,677 136,998 Securities and other investments 7,145 4,753 Property, plant and equipment, net 13,055 13,841 Intangible assets, net 77,872 62,995 Other long-term assets 1,445 2,187 ----------------- ---------------- Total assets $ 231,194 $ 220,774 ================= ================ Liabilities and shareholders' equity Current liabilities: Bank borrowings $ 2,854 $ 6,977 Current portion of long-term debt 161 399 Trade accounts payable 8,200 7,562 Other current liabilities 22,562 22,188 ----------------- ---------------- Total current liabilities 33,777 37,126 Long-term debt 48 44 Deferred income taxes 1,907 2,202 Deferred income 2,500 2,500 Other long-term liabilities 45 58 Deferred compensation 1,001 893 ----------------- ---------------- Total liabilities 39,278 42,823 ----------------- ---------------- Minority interests 0 9,867 Shareholders' equity Common shares 1,423 1,384 Additional paid-in capital 53,479 50,884 Less: Treasury shares, at cost (2,513) (5,281) ----------------- ---------------- 52,389 46,987 Retained earnings 135,642 123,194 Accumulated other comprehensive income 3,885 (2,097) ----------------- ---------------- Total shareholders' equity 191,916 168,084 ----------------- ---------------- Total liabilities, minority interests and shareholders' equity $ 231,194 $ 220,774 ================= ================
ORTHOFIX INTERNATIONAL N.V. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited, U.S. Dollars, in thousands)
For the six months ended June 30, ----------------------------------- 2003 2002 --------------- -------------- Net cash provided by operating activities $ 14,724 $ 11,144 --------------- -------------- Cash flows from investing activities: Investment in subsidiaries and affiliates (23,659) (7,254) Capital expenditure (2,194) (3,084) --------------- -------------- Net cash used in investing activities (25,853) (10,338) --------------- -------------- Cash flows from financing activities: Net repayment of loans and borrowings (4,809) (2,611) Proceeds from issuance of common stock 9,483 13,268 Acquisition of treasury shares (4,395) (10,335) --------------- -------------- Net cash provided by financing activities 279 322 --------------- -------------- Effect of exchange rate changes on cash 721 1,123 --------------- -------------- Net (decrease) increase in cash and cash equivalents (10,129) 2,251 Cash and cash equivalents at the beginning of the period 48,813 34,273 --------------- -------------- Cash and cash equivalents at the end of the period $ 38,684 $ 36,524 --------------- --------------
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