SAN DIEGO, Aug. 7 /PRNewswire-FirstCall/ -- ResMed Inc. today announced revenue and pro forma income results for the quarter ended June 30, 2007. Revenue for the quarter was $191.3 million, a 12% increase over the quarter ended June 30, 2006. For the current quarter, pro forma income from operations and pro forma net income were $42.4 million and $32.2 million (pro forma measures exclude the impact of stock-based compensation costs, restructuring expenses, amortization of acquired intangible assets and voluntary product recall expenses, as described below). Pro forma diluted earnings per share for the quarter ended June 30, 2007 were $0.41, compared to $0.40 for the quarter ended June 30, 2006. GAAP operating income was $36.0 million for the current quarter, while GAAP net income was $27.7 million or $0.35 per diluted share, compared with $0.30 in the year ago quarter, an increase of 17%. Gross margin was 61.3% for the quarter ended June 30, 2007.
Pro forma selling, general and administration (SG&A) costs for the quarter were $61.3 million, an increase of $10.7 million, or 21%, over the same period in fiscal 2006. Pro forma SG&A costs were 32% of revenue in the June quarter, compared to 30% in the same period in fiscal 2006. GAAP SG&A costs were $65.2 million for the quarter, an increase of $11.5 million or 21% over the quarter ended June 30, 2006. The increase in SG&A was primarily due to the addition of selling and administration personnel and related expenses to support sales growth.
Pro forma research & development expenditure during the June quarter was $13.7 million. GAAP R&D expense during the quarter was $14.2 million or approximately 7% of revenue. GAAP R&D expenses increased 28% year over year and are expected to remain between 6% and 7% of net revenue through fiscal year 2008.
For the year ended June 30, 2007, revenue was $716.3 million, an increase of 18% over the $607.0 million for the year ended June 30, 2006. Pro forma income from operations and pro forma net income were $174.3 million and $125.8 million, or $1.59 per diluted share, an increase of 13% and 16%, respectively. On a GAAP basis, income from operations was $90.2 million, while net income for the year ended June 30, 2007 was $66.3 million or $0.85 per diluted share.
Amortization of acquired intangibles of $1.8 million ($1.2 million net of tax), incurred during the quarter ended June 30, 2007 consisted of amortization of acquired intangible assets associated with our acquisitions of Resprecare, Hoefner, Saime, Pulmomed and PolarMed. Stock-based compensation costs incurred during the quarter ended June 30, 2007, of $4.5 million ($3.3 million net of tax), consisted of expenses associated with stock options granted to employees and the employee stock purchase plan.
The Company has provided tabular reconciliation of GAAP operating income and GAAP net income with pro forma operating income and pro forma net income, (excluding the impact of stock-based compensation costs, restructuring expenses, amortization of acquired intangibles, American Jobs Creation Act of 2004 ('AJCA') and voluntary product recall expenses) for the quarters and years ended June 30, 2007 and 2006.
Inventory at $157.2 million as of June 30, 2007, was comparable to March 31, 2007 level of $156.9 million. Accounts receivable days sales outstanding, at 77 days, increased from the March 31, 2007 quarter of 73 days.
Peter C. Farrell Ph.D., Chairman and Chief Executive Officer, commented, "In the fourth quarter of fiscal 2007, overall Americas sales increased by 10%; excluding sales from our motor division, Americas sales increased by 13% over the year ago quarter. Sales growth for the Americas were impacted by challenging year ago comparables when we grew by 44% and a product recall initiated during the current year's quarter. Sales outside of the Americas totaled $92.8 million, a 14% increase over last year. Operating cash flow for the June quarter was an encouraging $27.1 million. While we are not satisfied with our Q407 results, we had a robust fiscal year 2007, and we remain optimistic about our growth moving forward.
Dr. Farrell continued, "I am also pleased to announce that we have set up three distinct strategic business units. They are now operational under the leadership of Senior Vice Presidents Don Darkin (Interfaces), Michael Farrell (Positive Airway Pressure Devices) and Stein Jacobsen (Portable Ventilators). The SBU leaders will be responsible for product management in their respective areas, while our regional chief operating officers will continue to lead our commercial teams. This reorganization streamlines our management structure by removing one layer of management, and aligns our structure better with market expansion opportunities.
Dr. Farrell continued, "We are encouraged by the initial response to our newly-launched full face masks: Quattro and Liberty, with strong early sales achieved by these innovative products. We saw continued growth in Adapt SV sales with complex sleep apnea continuing to gain recognition within the sleep community. In fiscal 2008, we plan to expand our market development initiatives in cardiology, diabetes and occupational health and we will also launch a number of new products in the mask and flow generator segments. I am encouraged that we are beginning to lift the veil of ignorance of sleep-disordered breathing and remain optimistic about our continued organic growth in the years ahead."
RMD Price at posting:
0.0¢ Sentiment: Buy Disclosure: Not Held
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