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Span-America Medical Systems, Inc. (NASDAQ:SPAN) today reported its results for the fourth quarter and fiscal year ended October 1, 2011. The company reported fourth quarter 2011 sales of $13.7 million and net income of $910,000, or $0.32 per diluted share. Sales for fiscal year 2011 were $52.6 million, and net income was $3.7 million, or $1.30 per diluted share.
“Span-America reported a 3% increase in medical segment sales in the fourth quarter of fiscal 2011 compared to the fourth quarter of last year due to increased demand for our proprietary therapeutic support surfaces,” stated Jim Ferguson, president and CEO of Span-America Medical Systems. “The growth in medical sales was offset by lower custom products segment sales that decreased 7% compared with the fourth quarter of fiscal 2010 due to a successful sales promotion last year with a large customer that was not repeated in the fourth quarter of this year.
“Our fourth quarter 2011 earnings were down from fourth quarter last year due primarily to higher raw material and administrative costs compared with the prior year. We expect sales and earnings to improve in fiscal 2012 based on increasing demand for our new products, customer promotions scheduled, the potential for a significant large-corporate order in the medical segment and the expectation of more stable raw material pricing,” continued Mr. Ferguson.
Fourth Quarter Results
Sales for the fourth quarter of fiscal 2011 decreased 1% to $13.7 million compared with $13.8 million in the same quarter last year. Medical sales rose 3% to $9.0 million in the fourth quarter of fiscal 2011 compared with $8.7 million in the fourth quarter last year. Sales in the custom products segment were down 7% to $4.7 million compared with $5.1 million in the fourth quarter of fiscal 2010.
The majority of the sales growth in the medical segment came from our product lines of therapeutic support surfaces, where sales increased 8% to $5.7 million compared with $5.3 million in the same quarter last year. Most of the sales growth came from the PressureGuard® Easy Air® low-air-loss product line, our new Custom Care® therapeutic support surfaces and higher volume of Geo-Mattress® therapeutic support surfaces, including the newly introduced Geo-Mattress UltraMax™.