Wright Medical (WMGI:NASDAQ) Reports 4Q:04 Financials
BY JOHN CHOPACK, FEBRUARY 14, 2005
Wright reported both 4Q:04 and year-end 2004 financials on Thursday evening. 4Q:04 revenues totaled $77.7 million a 13% increase over 4Q:03 revenues and at the upper end of management's previous guidance of revenues of $76-$78 million. Revenues for the year totaled $298.7 million for 2004 which was a 20% increase over 2003. Earnings per share (EPS) totaled $0.23 for the 4Q:04 which was a 22% increase over the 4Q:04. 2004 EPS increased 29% over the 2003, totaling $75.
Source: Company's reports
Hips - Management was quite pleased with the 17.2% growth in hips in 4Q:04. Even though the rate of growth was approximately 5% lower than the rate of growth seen during the 3Q:04, management indicated that the 4Q:04 had a difficult comparable to the 4Q:03 which saw domestic growth of 63%. Management stated that growth in hips was driven by metal-on-metal hips, CONSERVE product line with BFH technology and the PROFEMUR line of primary stems. Interesting to us was the fact that management didn't mention the ceramic-on-ceramic product line as one of these growth drivers. Wright indicated that there was no news to report regarding its CONSERVE PLUS FDA clinical trial except to mention that the FDA recently took the April panel date off its proposed panel meeting list. To date, management stated there was "certainly no negative developments to report".
Knees - Revenue from knee products totaled $23 million during the 4Q:04 which was an 8.3% increase over the 4Q:03. The revenue growth experienced during the 4Q:04 was in-line with the 8.6% increase experienced during the 3Q:04. Management stated that is was pleased with its knee product line which increased 28% domestically during the 4Q:04.
Biologics - During the 4Q:04 biologics revenues totaled $16 million and increased 11% over the 4Q:03. The 11% growth in revenues was significantly slower than the 28% increase experienced during the 3Q:03. Management indicated that the slow down in biologic revenue growth was expected to continue for a couple of more quarters. The recent received stand-alone reimbursement for the use of GraftJackt in the repair of diabetes related foot ulcers and other complex wounds should help kick start revenue growth.
Extremity - Revenues from extremity sales totaled $9.4 million which was an 11.2% increase over the 4Q:04 and nearly twice the rate of growth experienced during the 3Q:03. Management spent a significant amount of time discussing the upcoming loss of the Newdeal product line which was recently acquired by Integra LifeSciences. Management indicated that for some time now it had been internally developing a replacement line and stated it provide more details regarding the launch of these products once its distribution agreement ends on February 14th.
Guidance - Management reiterated its guidance that was provided in December 2004 for 2005 revenues to total $333-344 million representing a 12-16% increase over 2004. EPS are still expected to total $0.86-$0.90 for 2005.
