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Thoratec's CEO Discusses Q2 2012 Results - Earnings Call Transcript

Stocks in this article: THOR

Gerhard Burbach

Thank you, Taylor, and good afternoon. Thoratec generated solid results in the second quarter of 2012, capping off the strongest six months financial performance in the company's history. We continue to experience broad-based momentum in the global VAD market driven by strong performance from HeartMate II. On a year-over-year basis HeartMate II units grew 22% during the first six months of 2012. And in the second quarter which I would note is our most challenging quarterly comparison this year, units grew 13%.

We have realized strong performance across all key areas of our HeartMate II business, but the most significant growth drivers continue to be the ongoing development of the destination therapy indication, along with a strong contribution from emerging transplant programs and open-heart centers in the United States as well as broad-based strength internationally.

Meanwhile our acute support product line including CentriMag and PediMag, is also performing well with revenues expanding nearly 20% in the first half of 2012, excluding the impact of the Levitronix Medical acquisition. These strong results from both HeartMate II and CentriMag have more than offset a weak first half of the year for our PVAD and IVAD franchise, where revenues have declined 36% year-to-date.

During the second quarter this decline was somewhat more pronounced with revenues falling 50% or almost $4 million year-over-year. In aggregate though, we were incredibly pleased with the company's performance in the second quarter and year-to-date. During the first half of 2012, we have achieved revenue growth of 16% versus the same period last year. Increased non-GAAP earnings per share by 25% and made significant strides in both our market development and product development efforts, which should support strong performance for many years to come.

With respect to our financial results for the second quarter, Thoratec generated revenues of $118.6 million, a 7% increase over revenues of $111.2 million in the second quarter of 2011. In terms of geographic breakdown we recorded revenues of $97.1 million in the United States versus $93 million in the prior year, while international revenues were $21.5 million versus $18.2 million a year ago. Relative to the second quarter of 2011, foreign exchange fluctuation detracted $1.2 million from Q2 2012 revenues. While the acquisition of the CentriMag and PediMag product lines added $2.5 million, of which $2.2 million was recorded outside the United States.

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