Penumbra, Inc. Reports First Quarter 2016 Financial Results

ALAMEDA, Calif., May 9, 2016 /PRNewswire/ — Penumbra, Inc.(NYSE: PEN), a global interventional therapies company, today reported financial results for the first quarter ended March 31, 2016.

Penumbra, Inc. Logo
  • Revenue of $57.9 million in the first quarter of 2016, an increase of 48.7%, or 51.0% in constant currency1, over the first quarter of 2015.

First Quarter 2016 Financial Results
Total revenue grew to $57.9 million for the first quarter of 2016 compared to $39.0 million for the first quarter of 2015, an increase of 48.7%, or 51.0% on a constant currency basis. The U.S. represented 68.0% of total revenue and international represented 32.0% of total revenue for the first quarter of 2016. Revenue from sales of neuro products grew to $41.3 million for the first quarter of 2016, an increase of 30.4%, or 32.8% on a constant currency basis. Revenue from sales of peripheral vascular products grew to $16.6 million for the first quarter of 2016, an increase of 127.9%, or 130.0% on a constant currency basis.

Gross profit was $39.9 million, or 68.9% of total revenue, for the first quarter of 2016, compared to $26.7 million, or 68.6% of total revenue, for the first quarter of 2015.

Total operating expenses were $38.1 million, or 65.7% of total revenue, for the first quarter of 2016, compared to $22.7 million, or 58.4% of total revenue, for the first quarter of 2015. R&D expenses were $5.0 million for the first quarter of 2016, compared to $3.2 million for the first quarter of 2015. SG&A expenses were $33.1 million for the first quarter of 2016, compared to $19.5 million for the first quarter of 2015.

Net income for the first quarter of 2016 was $0.8 million, compared to $2.5 million for the first quarter of 2015.

As of March 31, 2016, cash and cash equivalents and marketable investments totaled $144.4 million.

Webcast and Conference Call Information
Penumbra, Inc. will host a conference call to discuss the first quarter 2016 financial results after market close on Monday, May 9, 2016 at 4:30 PM Eastern Time. The conference call can be accessed live over the phone by dialing (877) 201-0168 for domestic callers or (647) 788-4901 for international callers (conference id: 92077838), or the webcast can be accessed on the “Investors” section of the Company’s website at: www.penumbrainc.com. The webcast will be available on the Company’s website for two weeks following the completion of the call.

About Penumbra
Penumbra, Inc., headquartered in Alameda, California, is a global interventional therapies company that designs, develops, manufactures and markets innovative medical devices. The company has a broad portfolio of products that address challenging medical conditions and significant clinical needs across two major markets, neuro and peripheral vascular. Penumbra sells its products to hospitals primarily through its direct sales organization in the U.S., most of Europe, Canada and Australia, and through distributors in select international markets. Penumbra and the Penumbra logo are trademarks of Penumbra, Inc.

Non-GAAP Financial Measures
In addition to financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), the Company has disclosed the non-GAAP financial measure relating to constant currency revenue in this press release.

Our constant currency revenue disclosures estimate the impact of changes in foreign currency rates on the translation of the Company’s current period revenue as compared to the applicable comparable period in the prior year. This impact is derived by taking the current local currency revenue and translating it into U.S. Dollars based upon the foreign currency exchange rates used to translate the local currency revenue for the applicable comparable period in the prior year, rather than the actual exchange rates in effect during the current period. It does not include any other effect of changes in foreign currency rates on the Company’s results or business.

Full reconciliation of this non-GAAP measure to the most comparable GAAP measures is set forth in the tables below.

Our management believes the non-GAAP financial measure disclosed in this press release is useful to investors in assessing the operating performance of our business and provides a meaningful comparison to prior periods and thus a more complete understanding of our business than could be obtained absent this disclosure. Specifically, we consider the change in constant currency revenue as a useful metric as it provides an alternative framework for assessing how our underlying business performed excluding the effect of foreign currency rate fluctuations.

The non-GAAP financial measure included in this press release may be different from, and therefore may not be comparable to, similarly titled measures used by other companies. Non-GAAP measures should not be considered in isolation or as alternatives to GAAP measures. We urge investors to review the reconciliation of the non-GAAP financial measure to the comparable GAAP financial measures included in this press release, and not to rely on any single financial measure to evaluate our business.

Forward-Looking Statements
Except for historical information, certain statements in this press release are forward-looking in nature and are subject to risks, uncertainties and assumptions about us. Our business and operations are subject to a variety of risks and uncertainties and, consequently, actual results may differ materially from those projected by any forward-looking statements. Factors that could cause actual results to differ from those projected include, but are not limited to: failure to sustain or grow profitability or generate positive cash flows; failure to effectively introduce and market new products; delays in product introductions; significant competition; inability to further penetrate our current customer base, expand our user base and increase the frequency of use of our products by our customers; inability to achieve or maintain satisfactory pricing and margins; manufacturing difficulties; permanent write-downs or write-offs of our inventory; product defects or failures; unfavorable outcomes in clinical trials; inability to maintain our culture as we grow; fluctuations in foreign currency exchange rates; and potential adverse regulatory actions. These risks and uncertainties, as well as others, are discussed in greater detail in our filings with the Securities and Exchange Commission, including our Annual Report Form 10-K for the year ended December 31, 2015 filed with the SEC on March 8, 2016. There may be additional risks of which we are not presently aware or that we currently believe are immaterial which could have an adverse impact on our business. Any forward-looking statements are based on our current expectations, estimates and assumptions regarding future events and are applicable only as of the dates of such statements. We make no commitment to revise or update any forward-looking statements in order to reflect events or circumstances that may change.

______________________

1 Constant currency results are non-GAAP financial measures. Please refer to “Non-GAAP Financial Measures” for important information about our use of constant currency results, including reconciliations to the most comparable GAAP measures.

Penumbra, Inc.

Condensed Consolidated Balance Sheets

(unaudited)

(in thousands)

March 31,

December 31,

2016

2015

Assets

Current assets:

Cash and cash equivalents

$ 17,606

$ 19,547

Marketable investments

126,813

129,257

Accounts receivable,net of doubtful accounts of $600 and
$589 at March 31, 2016 and December 31, 2015, respectively

31,156

29,444

Inventories

66,564

56,761

Prepaid expenses and other current assets

11,512

9,352

Total current assets

253,651

244,361

Property and Equipment, net

9,717

8,951

Deferred taxes

11,318

10,143

Other non-current assets

435

393

Total assets

$ 275,121

$ 263,848

Liabilities and Stockholders’ Equity

Current Liabilities:

Accounts payable

$ 4,022

$ 2,567

Accrued liabilities

29,957

25,581

Total current liabilities

33,979

28,148

Other non-current liabilities

3,094

3,178

Total liabilities

37,073

31,326

Stockholders’ Equity:

Common stock

30

30

Additional paid-in capital

255,499

252,087

Notes receivable from stockholders

(5)

Accumulated other comprehensive loss

(786)

(2,115)

Accumulated deficit

(16,695)

(17,475)

Total stockholders’ equity

238,048

232,522

Total liabilities and stockholders’ equity

$ 275,121

$ 263,848

Penumbra, Inc.

Condensed Consolidated Statements of Operations

(unaudited)

(in thousands, except share and per share amounts)

Three Months Ended March 31,

2016

2015

Revenue

$ 57,919

$ 38,952

Cost of revenue

18,014

12,224

Gross profit

39,905

26,728

Operating expenses:

Research and development

5,001

3,191

Sales, general and administrative

33,069

19,547

Total operating expenses

38,070

22,738

Income from operations

1,835

3,990

Interest income (expense), net

510

208

Other income (expense), net

(224)

44

Income before provision for income taxes

2,121

4,242

Provision for income taxes

1,341

1,740

Net income

780

2,502

Net income attributable to common stockholders

$ 780

$ 503

Net income per share attributable to common stockholders
—Basic

$ 0.03

$ 0.10

—Diluted

$ 0.02

$ 0.07

Weighted average shares used to compute net income per share attributable to common stockholders
—Basic

29,990,006

4,903,535

—Diluted

32,486,516

7,193,452

Penumbra, Inc.

Reconciliation of Revenue Growth by Geographic Regions to Constant Currency Revenue Growth1

(unaudited)

(in thousands)

Three Months Ended March 31,

Reported Change

FX Impact

Constant Currency Change

2016

2015

$

%

$

$

%

United States

$ 39,412

$ 26,351

$ 13,061

49.6%

$ –

$ 13,061

49.6%

International

18,507

12,601

5,906

46.9%

895

6,801

54.0%

Total

$ 57,919

$ 38,952

$ 18,967

48.7%

$ 895

$ 19,862

51.0%

Penumbra, Inc.

Reconciliation of Revenue Growth by Product Categories to Constant Currency Revenue Growth1

(unaudited)

(in thousands)

Three Months Ended March 31,

Reported Change

FX Impact

Constant Currency Change

2016

2015

$

%

$

$

%

Neuro

$ 41,284

$ 31,654

$ 9,630

30.4%

$ 742

$ 10,372

32.8%

Peripheral Vascular

16,635

7,298

9,337

127.9%

153

9,490

130.0%

Total

$ 57,919

$ 38,952

$ 18,967

48.7%

$ 895

$ 19,862

51.0%

1See “Non-GAAP Financial Measures” above for important information about our use of non-GAAP measure and further information about our calculation of constant currency results.

Investor Relations
Penumbra, Inc.
510-995-2461
investors@penumbrainc.com

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SOURCE Penumbra, Inc.