ZOLL Medical second quarter revenues increase 14% to $122.5 million

Apr 28 2011

ZOLL Medical Corporation (Nasdaq GS: ZOLL), a manufacturer of resuscitation devices and related software solutions, today announced that revenues for the second quarter of fiscal 2011 increased 14% to $122.5 million, compared to revenues in the second quarter of last year of $107.1 million. Net income increased 65% to $6.0 million for the quarter, compared to $3.7 million in the prior year. Diluted earnings per share grew 59% to $0.27, compared to $0.17 in the prior year. Backlog at the end of the second quarter was approximately $29 million, as compared to $13 million at the end of Q1 2011 and $22 million at the end of Q2 2010.

Second quarter sales to the North American market were $63.2 million, a decrease of 2%, compared to $64.3 million for the prior-year period. Sales to the North American hospital market included U.S. Military/Big Government sales of $3.3 million in the second quarter of fiscal 2011, compared to $4.0 million for the same period in the prior year. Excluding this military business, core North American hospital sales increased 4% to $27.1 million compared to $26.2 million in the prior year. Sales to the North American pre-hospital market decreased 4% to $32.7 million, compared to $34.2 million last year. International revenues increased by 25% to $32.7 million, compared to $26.1 million in the same period in the prior year. LifeVest® revenues increased 60% to $26.6 million.

From a product perspective, total Temperature Management sales increased 52% to $6.1 million, compared to $4.0 million in the same period last year. Total AutoPulse® sales decreased 34% to $3.0 million, compared to $4.5 million in the second quarter of last year.

Gross margin for the second quarter was 58%, compared to 55% in the second quarter of fiscal 2010. The increase primarily reflected an increased mix of higher margin LifeVest revenue and a particularly favorable mix of International revenue from the Company's direct subsidiaries.

Richard A. Packer, Chief Executive Officer of ZOLL, commented, "Q2 was a very strong quarter for ZOLL with good growth, as expected, from our LifeVest business. In addition, we were pleased to see higher than expected performance from our International business. This performance was broad-based geographically and included both core defibrillator products and our newer Temperature Management products."

Commenting further on the second quarter, Mr. Packer stated, "We were also happy to see continued improvement in our gross margin. As the LifeVest revenue growth exceeds our corporate average growth, we should continue to see a positive impact on our gross margins. Q2 was particularly strong in our International direct business and that helped a lot." He added, "Our backlog growth in Q2 reflected the improving overall business strength of our Company."

Mr. Packer concluded, "We expected to build momentum as we moved through the year and, as you can see from our results, our bottom line is running ahead of plan. Q2 was a robust quarter overall, even though not all areas of the business are growing at this point. Based on our strength in the first half of fiscal 2011 and our strong backlog entering the back half of the year, we believe we will modestly exceed the high end of our earnings expectations for fiscal 2011."

Source: ZOLL Medical Corporation