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The Cooper Companies Announces Third Quarter 2013 Results

Stocks in this article: COO

PLEASANTON, Calif., Sept. 5, 2013 (GLOBE NEWSWIRE) -- The Cooper Companies, Inc. (NYSE:COO) today announced financial results for the fiscal third quarter ended July 31, 2013.

  • Revenue increased 9% year-over-year to $412.0 million. CooperVision (CVI) revenue up 5% to $330.5 million, up 9% in constant currency, and CooperSurgical (CSI) revenue up 27% to $81.5 million.  
  • GAAP earnings per share (EPS) $1.79, up 43 cents or 32% from last year's third quarter.  
  • Non-GAAP EPS $1.74, up 29 cents or 20% from last year's third quarter. See "Reconciliation of Non-GAAP EPS to GAAP EPS" below.  
  • Third quarter free cash flow $64.5 million.

Commenting on the results, Robert S. Weiss, Cooper's president and chief executive officer said, "I am pleased to report another strong quarter for the Company. We continued to gain market share within CVI, CSI posted solid revenue growth driven by fertility, and we generated strong EPS and significant free cash flow. We remain encouraged by our business trends and believe we are well positioned to deliver strong operating results to finish our fiscal year."

Third Quarter GAAP Operating Highlights

  • Revenue $412.0 million, up 9% from last year's third quarter, 12% in constant currency.  
  • Gross margin 65% compared with 63% in last year's third quarter. The increase was primarily the result of a lower royalty payment on silicone hydrogel lens sales, product mix and increased manufacturing efficiencies, partially offset by lower revenue due to currency, primarily the Yen.  
  • Operating margin 23% compared with 20% in last year's third quarter. The increase was the result of higher gross margins.  
  • Depreciation $23.4 million, up 7% from last year's third quarter. Amortization $7.7 million, up 31% from last year's third quarter, primarily related to intangible assets from the acquisition of Origio in July 2012.  
  • Total debt decreased $76.9 million in the quarter to $243.6 million. Interest expense $2.3 million down 2% from last year's third quarter.  
  • Cash provided by operations $103.1 million and capital expenditures $38.6 million resulted in free cash flow $64.5 million.

Third Quarter CooperVision GAAP Operating Highlights

  • Revenue $330.5 million, up 5% from last year's third quarter, 9% in constant currency.  
  • Revenue by category:
        Constant Currency
  (In millions) % of CVI Revenue %chg %chg
  3Q13 3Q13 y/y y/y
Toric  $ 101.5 31% 7% 8%
Multifocal  33.1 10% 33% 32%
Single-use sphere  70.7 21% -1% 9%
Non single-use sphere, other  125.2 38% 2% 4%
Total  $ 330.5 100% 5% 9%
  • Revenue by geography:
        Constant Currency
   (In millions)  % of CVI Revenue %chg %chg
   3Q13  3Q13 y/y y/y
Americas  $ 143.0 43% 9% 9%
EMEA  118.4 36% 11% 8%
Asia Pacific  69.1 21% -9% 8%
Total  $ 330.5 100% 5% 9%
  • Selected revenue by material:
        Constant Currency
   (In millions)  % of CVI Revenue %chg %chg
   3Q13  3Q13 y/y y/y
         
Silicone hydrogel  $ 143.0 43% 21% 22%
Proclear ®  $ 86.0 26% 9% 11%
  • Gross margin 65% compared with 63% in last year's third quarter. The increase was primarily the result of a lower royalty payment on silicone hydrogel lens sales, product mix and increased manufacturing efficiencies, partially offset by lower revenue due to currency, primarily the Yen.

Third Quarter CooperSurgical GAAP Operating Highlights

  • Revenue $81.5 million, up 27% from last year's third quarter, driven by the acquisition of Origio in July 2012.  
  • Revenue by category:
  (In millions) % of CSI Revenue %chg
  3Q13 3Q13 y/y
Office and surgical procedures  $ 54.0 66% 0%
Fertility  27.5 34% 180%
Total  $ 81.5 100% 27%
  • Gross margin 64% compared with 67% in last year's third quarter. The decrease was primarily the result of lower margins associated with the acquisition of Origio.

2013 Guidance

The Company revises its full year fiscal 2013 guidance. Guidance is summarized as follows:

  FY13 Guidance FY13 Guidance 4Q13 Guidance
  Old New New
Revenues (In millions)      
Total $1,575 - $1,605 $1,586 - $1,601 $410 - $425
CVI $1,260 - $1,280 $1,271 - $1,281 $330 - $340
CSI $315 - $325 $315 - $320 $80 - $85
EPS      
GAAP $6.42 - $6.52 $6.57 - $6.62 $1.76 - $1.81
Non-GAAP $6.15 - $6.25 $6.23 - $6.28 $1.76 - $1.81
Free Cash Flow (In millions) $170 - $200 $180 - $210 $19 - $49

Guidance assumes constant currency at the date of issuance and excludes the financial impact for the proposed sale of Aime announced on May 31, 2013.

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