AngioDynamics Outperforms

AngioDynamics, Inc. (ANGO) yesterday reported first quarter fiscal 2010 earnings per share of 9 cents, surpassing the Zacks Consensus Estimate of 8 cents. Earnings per share in the year-ago quarter also reached 9 cents.

Sales

Net sales in the reported quarter were $50.1 million, increasing 13% year over year. The increase was across all the business segments. On a geographic basis, U.S. sales contributed approximately 90% of total sales and increased roughly 15% year over year. International sales were roughly flat year over year.

Peripheral Vascular sales increased 14% year over year to $21.1 million. This was primarily due to the Benephit renal infusion system and Diomed acquisitions. Access sales increased 3% year over year to $16.2 million. Oncology/Surgery sales increased 25% year over year to $12.8 million.

Margins

Gross margin declined 170 basis points (bps) year over year to 60.2% in the quarter. The decline was primarily due to an unfavorable product mix, higher costs of raw materials, a competitive pricing environment and lower utilization rates. Operating expenses increased due to higher sales and marketing programs and the company’s continuing investments in irreversible electroporation (IRE) technology.

Lower gross margin and higher operating expenses were primarily responsible for lower operating and net margins. Operating margin declined 150 bps year over year to 7.1%. Net margin declined 80 bps year over year to 4.2%.

Balance Sheet

AngioDynamics ended the reported quarter with cash, cash equivalents and short-term investments of roughly $68.8 million, compared to $68.2 million in the prior quarter. The company ended the quarter with a long-term debt of $6.7 million.

Outlook

AngioDynamics has provided guidance for the full fiscal year 2010. Net sales are estimated between $211 million and $215 million, compared to the previous guidance of $209 million to $215 million. Gross margin should range between 61% and 62%. Operating income should be in the range of $18 million to $20 million.

AngioDynamics is engaged in the designing, development, manufacture and marketing of therapeutic and diagnostic devices to treat peripheral vascular disease (PVD) and other non-coronary diseases.

Read the full analyst report on ANGO