SOURCE: CONMED Corporation

CONMED Corporation

October 22, 2009 07:00 ET

CONMED Corporation Announces Third Quarter 2009 Financial Results

Conference Call to Be Held at 10:00 a.m. ET Today

UTICA, NY--(Marketwire - October 22, 2009) - CONMED Corporation (NASDAQ: CNMD) today announced financial results for the third quarter of 2009.

Sales for the third quarter ended September 30, 2009 were $175.5 million compared to $179.4 million in the same quarter of 2008. GAAP diluted earnings per share were $0.04 compared to $0.33 in the third quarter of 2008. Non-GAAP diluted earnings per share equaled $0.28 compared to non-GAAP diluted earnings per share of $0.37 in the 2008 third quarter. As discussed below under "Use of Non-GAAP Financial Measures," the Company presents various non-GAAP financial measures in this release. Investors should consider non-GAAP measures in addition to, and not as a substitute for, or superior to, financial performance measures prepared in accordance with GAAP. Please refer to the attached reconciliation between GAAP and non-GAAP financial measures.

For the nine months ended September 30, 2009, sales were $504.1 million compared to $562.9 million in the first nine months of 2008. GAAP diluted earnings per share were $0.25 for year-to-date September 2009 compared to $1.09 in the same period of 2008. Non-GAAP diluted earnings per share were $0.63 for the 2009 nine-month period compared to $1.20 in 2008.

"The Company's third quarter financial results, excluding unusual items, were substantially better than we had anticipated due to increased sales volumes and more favorable foreign currency exchange rates. Sequentially, compared to the second quarter of 2009, sales increased approximately $11.0 million, reversing the historical seasonal trend of a decline from the second to the third quarter due to reduced summer surgical activity. Both our single-use and capital equipment sales were considerably stronger in the third quarter as compared to the first half of the year. We believe the sales volume increases we delivered in the third quarter are an indication that the economic trends that adversely impacted our industry late last year and in the first six months of this year, are beginning to moderate," commented Mr. Joseph J. Corasanti, President and Chief Executive Officer.

As previously announced, the Company has taken various cost-cutting actions in response to the current economic environment, including, most recently, consolidating a division's administrative functions within the Corporate headquarters, delaying hiring for certain open positions, reducing production where the Company believes it has sufficient finished goods on hand, freezing the defined benefit pension plan for U.S. employees, and continuing with the previously announced manufacturing restructuring. Our transition to the new manufacturing site in Mexico is now substantially complete, but we expect to incur additional restructuring costs through the end of 2009 as we close two Upstate New York plants, as well as the divisional administrative office. Over the final three months of 2009, we expect that such costs will approximate $2.5 million for the manufacturing sites and $1.8 million for the administrative office (further described below). The Company continues to review its total cost structure for reductions in areas that are not critical to CONMED's long-term growth strategy.

International sales in the third quarter of 2009 were $77.2 million, representing 44.0% of total sales, and $223.8 million for the nine months ended September 30, 2009. Although currency exchange rates have improved compared to those of the first six months of 2009, compared to the rates in 2008, sales were reduced by $4.7 million in the third quarter of 2009, and $27.2 million for the nine months of 2009.

Outlook

Mr. Corasanti added, "As we look to the completion of 2009, we expect that the improving business trends of the third quarter should continue into the last quarter of the year. Consequently, we anticipate that fourth quarter 2009 sales should approximate $178 - $183 million and that non-GAAP earnings per share should approximate $0.30 - $0.35. For 2010, we are basing our expectations on continued measured improvement in the general economy, as well as foreign currency exchange rates similar to those experienced in the third quarter of 2009. Sales in 2010 are anticipated to be $715 - $725 million with non-GAAP diluted earnings per share estimated to be $1.20 - $1.30."

The non-GAAP estimates for the fourth quarter of 2009 exclude the additional amortization of bond discount required by recently issued Financial Accounting Standards Board ("FASB") guidance, the manufacturing restructuring costs and facility consolidation expenses expected to be incurred in 2009. The 2010 non-GAAP estimates exclude the amortization of bond discount and unusual costs, if any.

Endoscopic Technologies division consolidation

In July 2009, the Company began the process of consolidating the administrative functions of the Endoscopic Technologies division from its offices in Massachusetts to the Corporate Headquarters in Utica, New York. The sales force and product portfolio remain unchanged and CONMED Endoscopic Technologies will continue to operate as a separate division of the Company. In connection with this consolidation, we incurred costs of $0.3 million in the third quarter of 2009, including severance and other transitional costs. In the fourth quarter of 2009 we expect to incur similar costs, including lease termination expense, of $1.8 million. The third quarter 2009 costs are included in the GAAP earnings per share set forth above, and are excluded from the non-GAAP amount, as well as from the fourth quarter non-GAAP EPS estimate.

Product recall

During the third quarter of 2009, the Company announced a voluntary recall of certain model numbers of the PRO5 & PRO6 series battery handpieces and certain lots of the MC5057 Universal Cable used with certain of CONMED Linvatec's electric powered handpieces. Current models of products are not affected. We have estimated that the recall costs will total approximately $6.0 million and have recorded this charge in the third quarter. The third quarter 2009 costs are included in the GAAP earnings per share set forth above, and are excluded from the non-GAAP amount.

Convertible bond repurchase

During the first quarter of 2009, the Company repurchased and retired $9.9 million face value of its 2.5% Convertible Notes at a discount of approximately 21%. The repurchase was substantially funded by CONMED's own cash resources. The transaction resulted in a pre-tax gain to the 2009 nine-month financial statements of approximately $1.1 million, which is included in the GAAP earnings per share set forth above, and excluded from the non-GAAP amount.

U.S. pension plan

In March 2009, the Company gave notice that it would freeze the benefits of its defined benefit pension plan for United States employees. As has been widely reported, such plans have become increasingly difficult for companies to maintain because of the volatility in asset performance and required changes in the actuarial determination of plan liabilities. The Company's first quarter 2009 financial statements include a non-cash net pre-tax gain of $1.9 million, comprised of a $4.4 million pension curtailment benefit offset by a $2.5 million first quarter pension charge. This net non-cash pre-tax gain is included in the nine-month GAAP earnings per share set forth above, and is excluded from the non-GAAP amount.

Manufacturing restructuring

As previously disclosed, the Company continues with its plan for restructuring certain of its manufacturing operations by consolidating locations in New York and moving certain production lines to its new manufacturing site in Mexico. Such expenses amounted to $3.3 million in the third quarter of 2009 and $11.2 million for the first nine months of the year. These amounts are included in the GAAP earnings per share set forth above, and excluded from the non-GAAP amounts. In the fourth quarter of 2009 we expect such restructuring costs to approximate $2.5 million and are excluded from the non-GAAP EPS estimate.

Convertible note interest expense

As disclosed in the past, and in accordance with recently issued FASB guidance, beginning in 2009, the Company is required to record the amortization of the bond discount related to its convertible notes to bring the effective interest rate to a level approximating that of a non-convertible note of similar size and tenor. For the third quarter of 2009 and the first nine months of 2009, the Company recorded additional non-cash pre-tax interest charges of $1.0 million and $3.1 million, respectively. The pronouncement also requires that a similar adjustment be made in previously issued financial statements to facilitate comparative analysis. Accordingly, the 2008 financial statements have been adjusted and include additional interest expense of $1.2 million in the third quarter and $3.7 million for the first nine months. These charges are included in the GAAP earnings per share set forth above, and excluded from the non-GAAP amounts.

Use of Non-GAAP Financial Measures

Management has disclosed financial measurements in this press announcement that present financial information that is not in accordance with Generally Accepted Accounting Principles ("GAAP"). These measurements are not a substitute for GAAP measurements, although Company management uses these measurements as aids in monitoring the Company's on-going financial performance from quarter-to-quarter and year-to-year on a regular basis, and for benchmarking against other medical technology companies. Non-GAAP net income and non-GAAP earnings per share measure the income of the Company excluding unusual credits or charges that are considered by management to be outside of the normal on-going operations of the Company. Management uses and presents non-GAAP net income and non-GAAP earnings per share because management believes that in order to properly understand the Company's short and long-term financial trends, the impact of unusual items should be eliminated from on-going operating activities. These adjustments for unusual items are derived from facts and circumstances that vary in frequency and impact on the Company's results of operations. Management uses non-GAAP net income and non-GAAP earnings per share to forecast and evaluate the operational performance of the Company as well as to compare results of current periods to prior periods on a consistent basis. Non-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. Investors should consider non-GAAP measures in addition to, and not as a substitute for, or superior to, financial performance measures prepared in accordance with GAAP.

Conference call

The Company will webcast its third quarter 2009 conference call live over the Internet at 10:00 a.m. Eastern Time on Thursday, October 22, 2009. This webcast can be accessed from CONMED's web site at www.conmed.com. Replays of the call will be made available through October 29, 2009.

CONMED Profile

CONMED is a medical technology company with an emphasis on surgical devices and equipment for minimally invasive procedures and patient monitoring. The Company's products serve the clinical areas of arthroscopy, powered surgical instruments, electrosurgery, cardiac monitoring disposables, endosurgery and endoscopic technologies. They are used by surgeons and physicians in a variety of specialties including orthopedics, general surgery, gynecology, neurosurgery and gastroenterology. Headquartered in Utica, New York, the Company's 3,200 employees distribute its products worldwide from several manufacturing locations.

Forward-Looking Information

This press release contains forward-looking statements based on certain assumptions and contingencies that involve risks and uncertainties. The forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and relate to the Company's performance on a going-forward basis. The forward-looking statements in this press release involve risks and uncertainties which could cause actual results, performance or trends, to differ materially from those expressed in the forward-looking statements herein or in previous disclosures. The Company believes that all forward-looking statements made by it have a reasonable basis, but there can be no assurance that management's expectations, beliefs or projections as expressed in the forward-looking statements will actually occur or prove to be correct. In addition to general industry and economic conditions, factors that could cause actual results to differ materially from those discussed in the forward-looking statements in this press release include, but are not limited to: (i) the failure of any one or more of the assumptions stated above, to prove to be correct; (ii) the risks relating to forward-looking statements discussed in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2008; (iii) cyclical purchasing patterns from customers, end-users and dealers; (iv) timely release of new products, and acceptance of such new products by the market; (v) the introduction of new products by competitors and other competitive responses; (vi) the possibility that any new acquisition or other transaction may require the Company to reconsider its financial assumptions and goals/targets; and/or (vii) the Company's ability to devise and execute strategies to respond to market conditions.



                            CONMED CORPORATION
                        Third Quarter Sales Summary


                                     Three Months Ended September 30,
                                ------------------------------------------
                                                                  Constant
                                                                  Currency
                                   2008       2009      Growth     Growth
                                ---------- ---------- ---------  ---------
                                    (in millions)
Arthroscopy
  Single-use                    $     47.8 $     49.1       2.7%       5.9%
  Capital                             21.7       19.6      -9.7%      -6.9%
                                ---------- ---------- ---------  ---------
                                      69.5       68.7      -1.2%       1.9%
                                ---------- ---------- ---------  ---------

Powered Surgical Instruments
  Single-use                          19.0       19.0       0.0%       4.2%
  Capital                             19.8       18.3      -7.6%      -4.5%
                                ---------- ---------- ---------  ---------
                                      38.8       37.3      -3.9%      -0.3%
                                ---------- ---------- ---------  ---------

Electrosurgery
  Single-use                          17.4       17.8       2.3%       3.4%
  Capital                              6.1        6.3       3.3%       4.9%
                                ---------- ---------- ---------  ---------
                                      23.5       24.1       2.6%       3.8%
                                ---------- ---------- ---------  ---------

Endoscopic Technologies
  Single-use                          13.0       12.2      -6.2%      -3.8%
                                ---------- ---------- ---------  ---------
Endosurgery
  Single-use and reposable            15.8       15.9       0.6%       3.2%
                                ---------- ---------- ---------  ---------
Patient Care
  Single-use                          18.8       17.3      -8.0%      -7.4%
                                ---------- ---------- ---------  ---------

Total
  Single-use and reposable           131.8      131.3      -0.4%       2.2%
  Capital                             47.6       44.2      -7.1%      -4.4%
                                ---------- ---------- ---------  ---------
                                $    179.4 $    175.5      -2.2%       0.4%
                                ========== ========== =========  =========




                            CONMED CORPORATION
                         Nine-Month Sales Summary


                                      Nine Months Ended September 30,
                                ------------------------------------------
                                                                  Constant
                                                                  Currency
                                   2008       2009      Growth     Growth
                                ---------- ---------- ---------  ---------
                                    (in millions)
Arthroscopy
  Single-use                    $    150.6 $    142.0      -5.7%       0.7%
  Capital                             71.1       52.1     -26.7%     -22.6%
                                ---------- ---------- ---------  ---------
                                     221.7      194.1     -12.4%      -6.8%
                                ---------- ---------- ---------  ---------

Powered Surgical Instruments
  Single-use                          60.2       56.2      -6.6%       1.7%
  Capital                             58.9       47.4     -19.5%     -14.1%
                                ---------- ---------- ---------  ---------
                                     119.1      103.6     -13.0%      -6.1%
                                ---------- ---------- ---------  ---------

Electrosurgery
  Single-use                          54.1       52.0      -3.9%      -1.7%
  Capital                             22.1       17.1     -22.6%     -18.6%
                                ---------- ---------- ---------  ---------
                                      76.2       69.1      -9.3%      -6.6%
                                ---------- ---------- ---------  ---------

Endoscopic Technologies
  Single-use                          38.8       36.7      -5.4%      -1.0%
                                ---------- ---------- ---------  ---------
Endosurgery
  Single-use and reposable            48.2       47.8      -0.8%       3.3%
                                ---------- ---------- ---------  ---------
Patient Care
  Single-use                          58.9       52.8     -10.4%      -9.3%
                                ---------- ---------- ---------  ---------

Total
  Single-use and reposable           410.8      387.5      -5.7%      -0.8%
  Capital                            152.1      116.6     -23.3%     -18.7%
                                ---------- ---------- ---------  ---------
                                $    562.9 $    504.1     -10.4%      -5.6%
                                ========== ========== =========  =========




                            CONMED CORPORATION
                     CONSOLIDATED STATEMENTS OF INCOME
                  (in thousands except per share amounts)
                               (unaudited)


                              Three months ended       Nine months ended
                                  September 30,           September 30,
                            (As Adjusted)           (As Adjusted)
                                2008        2009        2008        2009
                             ----------  ----------  ----------  ----------

Net sales                    $  179,409  $  175,475  $  562,937  $  504,106

Cost of sales                    84,721      85,674     268,584     254,017
Cost of sales, other -
 Note A                               -       2,165       1,011       8,789
                             ----------  ----------  ----------  ----------

Gross profit                     94,688      87,636     293,342     241,300
                             ----------  ----------  ----------  ----------

Selling and administrative       67,768      67,480     205,963     193,480
Research and development          8,668       7,705      25,435      23,590
Other expense - Note B              709       7,449         709       6,847
                             ----------  ----------  ----------  ----------
                                 77,145      82,634     232,107     223,917
                             ----------  ----------  ----------  ----------

Income from operations           17,543       5,002      61,235      17,383

Gain on early extinguishment
 of debt                              -           -           -       1,083

Amortization of debt discount     1,243       1,018       3,667       3,076

Interest expense                  2,444       2,042       8,057       5,297
                             ----------  ----------  ----------  ----------

Income before income taxes       13,856       1,942      49,511      10,093

Provision for income taxes        4,121         654      17,839       2,911
                             ----------  ----------  ----------  ----------

Net income                   $    9,735  $    1,288  $   31,672  $    7,182
                             ==========  ==========  ==========  ==========
Per share data:

  Net Income
        Basic                $     0.34  $     0.04  $     1.10  $     0.25
        Diluted                    0.33        0.04        1.09        0.25

  Weighted average
   common shares
        Basic                    28,864      29,093      28,718      29,060
        Diluted                  29,415      29,183      29,189      29,096


Note A - Included in cost of sales, other, in the nine months ended
September 30, 2008 is a $1.0 million purchase accounting fair value
adjustment for inventory acquired in connection with the purchase of
our Italian distributor. Included in cost of sales, other, in the three
and nine months ended September 30, 2009 is $2.2 million and $8.8 million,
respectively, in costs related to the startup of a new manufacturing
facility in Chihuahua, Mexico and the consolidation of the Company's
three Utica, New York area manufacturing sites into a single facility.

Note B - Included in other expense in the three and nine months ended
September 30, 2008 are $0.7 million in costs related to the consolidation
of the Company's manufacturing and distribution sites. Included in other
expense in the three months ended September 30, 2009 are $6.0 million in
costs related to a voluntary product recall, $1.1 million in costs related
to the consolidation of the Company's distribution activities, and
$0.3 million in costs related to the consolidation of the administrative
functions of our Endoscopic Technologies division. Included in other
expense in the nine months ended September 30, 2009 is a non-cash net
pre-tax pension gain of $1.9 million, $6.0 million in costs related to a
voluntary product recall, $2.4 million in costs related to the
consolidation of the Company's distribution activities, and $0.3 million
in costs related to the consolidation of the administrative functions
of our Endoscopic Technologies division.




                            CONMED CORPORATION
                   CONSOLIDATED CONDENSED BALANCE SHEETS
                              (in thousands)
                                (unaudited)


                                               (As Adjusted)
                                                December 31,  September 30,
                   ASSETS                           2008          2009
                                                ------------  ------------
Current assets:
  Cash and cash equivalents                     $     11,811  $     14,217
  Accounts receivable, net                            96,515       108,825
  Inventories                                        159,976       164,929
  Deferred income taxes                               14,742        15,362
  Other current assets                                11,218        12,784
                                                ------------  ------------
      Total current assets                           294,262       316,117

Property, plant and equipment, net                   143,737       146,397
Goodwill                                             290,245       290,379
Other intangible assets, net                         195,939       192,101
Other assets                                           7,478         6,488
                                                ------------  ------------
      Total assets                              $    931,661  $    951,482
                                                ============  ============

       LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
  Current portion of long-term debt             $      3,185  $      2,142
  Other current liabilities                           71,729        78,642
                                                ------------  ------------
      Total current liabilities                       74,914        80,784

Long-term debt                                       182,739       182,917
Deferred income taxes                                 88,468        98,868
Other long-term liabilities                           45,325        18,300
                                                ------------  ------------
      Total liabilities                              391,446       380,869
                                                ------------  ------------

Shareholders' equity:
  Capital accounts                                   256,874       261,161
  Retained earnings                                  314,373       320,835
  Accumulated other comprehensive income
   (loss)                                            (31,032)      (11,383)
                                                ------------  ------------
      Total equity                                   540,215       570,613
                                                ------------  ------------

      Total liabilities and shareholders'
       equity                                   $    931,661  $    951,482
                                                ============  ============




                            CONMED CORPORATION
              CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
                              (in thousands)
                                (unaudited)


                                                      Nine months ended
                                                        September 30,
                                                    ----------------------
                                                   (As Adjusted)
                                                       2008        2009
                                                    ----------  ----------
Cash flows from operating activities:
  Net income                                        $   31,672  $    7,182
    Adjustments to reconcile net income
     to net cash provided by operating activities:
      Depreciation and amortization                     23,847      26,991
      Amortization of debt discount                      3,667       3,076
      Stock-based compensation expense                   3,215       3,203
      Deferred income taxes                             16,626       2,805
      Gain on early extinguishment of debt                   -      (1,083)
      Sale of accounts receivable to (collections
       on behalf of) purchaser                          (5,000)     (3,000)
      Increase (decrease) in cash flows from
       changes in assets and liabilities:
          Accounts receivable                           (1,398)     (5,326)
          Inventories                                   (2,973)     (7,593)
          Accounts payable                              (2,205)     (1,928)
          Income taxes receivable (payable)               (953)     (2,466)
          Accrued compensation and benefits              3,192       2,865
          Other assets                                  (1,966)     (1,228)
          Other liabilities                             (8,038)      2,281
                                                    ----------  ----------
    Net cash provided by operating activities           59,686      25,779
                                                    ----------  ----------

  Cash flow from investing activities:
      Purchases of property, plant, and equipment      (25,707)    (17,090)
      Payments related to business acquisitions        (22,033)       (262)
                                                    ----------  ----------
    Net cash used in investing activities              (47,740)    (17,352)
                                                    ----------  ----------

  Cash flow from financing activities:
      Payments on debt                                  (1,328)     (9,857)
      Proceeds of debt                                       -       7,000
      Net proceeds from common stock issued
       under employee plans                              7,048         360
      Net change in cash overdrafts                          -      (2,252)
                                                    ----------  ----------
    Net cash provided by (used in) financing
     activities                                          5,720      (4,749)
                                                    ----------  ----------

  Effect of exchange rate change on cash and
   cash equivalents                                      2,537      (1,272)
                                                    ----------  ----------

  Net increase in cash and cash equivalents             20,203       2,406

  Cash and cash equivalents at beginning of period      11,695      11,811
                                                    ----------  ----------

  Cash and cash equivalents at end of period        $   31,898  $   14,217
                                                    ==========  ==========




                            CONMED CORPORATION
         RECONCILIATION OF REPORTED NET INCOME TO NON-GAAP NET INCOME
            BEFORE UNUSUAL ITEMS AND AMORTIZATION OF DEBT DISCOUNT
                   (In thousands except per share amounts)
                               (unaudited)


                                                     Three months ended
                                                        September 30,
                                                    ----------------------
                                                   (As Adjusted)
                                                       2008        2009
                                                    ----------  ----------

Reported net income                                 $    9,735  $    1,288
                                                    ----------  ----------

New plant / facility consolidation costs included
 in cost of sales                                            -       2,165
                                                    ----------  ----------

Facility consolidation costs included in other
 expense                                                   709       1,118

Product recall                                               -       5,992

Endoscopic Technologies division consolidation               -         339
                                                    ----------  ----------

    Total other expense                                    709       7,449
                                                    ----------  ----------

Amortization of debt discount                            1,243       1,018
                                                    ----------  ----------

Unusual expense before income taxes                      1,952      10,632

Provision (benefit) for income taxes on unusual
 expense                                                  (715)     (3,837)
                                                    ----------  ----------

Net income before unusual items                     $   10,972  $    8,083
                                                    ==========  ==========

Per share data:

Reported net income
    Basic                                           $     0.34  $     0.04
    Diluted                                               0.33        0.04

Net income before unusual items
    Basic                                           $     0.38  $     0.28
    Diluted                                               0.37        0.28


Management has provided the above reconciliation of net income before
unusual items and amortization of debt discount as an additional measure
that investors can use to compare operating performance between reporting
periods. Management believes this reconciliation provides a useful
presentation of operating performance as discussed in the section "Use
of Non-GAAP Financial Measures" above. We have included the amortization
of debt discount in our analysis in order to facilitate comparison with
the non-GAAP earnings guidance provided in the "Outlook" section of this
and previous releases which exclude such expense.




                            CONMED CORPORATION
         RECONCILIATION OF REPORTED NET INCOME TO NON-GAAP NET INCOME
            BEFORE UNUSUAL ITEMS AND AMORTIZATION OF DEBT DISCOUNT
                   (In thousands except per share amounts)
                               (unaudited)


                                                      Nine months ended
                                                        September 30,
                                                    ----------------------
                                                   (As Adjusted)
                                                       2008        2009
                                                    ----------  ----------

Reported net income                                 $   31,672  $    7,182
                                                    ----------  ----------

New plant / facility consolidation costs included
 in cost of sales                                            -       8,789
                                                    ----------  ----------

Fair value inventory purchase accounting adjustment
 included in cost of sales                               1,011           -
                                                    ----------  ----------

Pension gain, net                                            -      (1,882)

Facility consolidation costs included in other
 expense                                                   709       2,398

Product recall                                               -       5,992

Endoscopic Technologies division consolidation               -         339
                                                    ----------  ----------

    Total other expense                                    709       6,847
                                                    ----------  ----------

Gain on early extinguishment of debt                         -      (1,083)
                                                    ----------  ----------

Amortization of debt discount                            3,667       3,076
                                                    ----------  ----------

Unusual expense before income taxes                      5,387      17,629

Provision (benefit) for income taxes on unusual
 expense                                                (1,974)     (6,375)
                                                    ----------  ----------

Net income before unusual items                     $   35,085  $   18,436
                                                    ==========  ==========

Per share data:

Reported net income
    Basic                                           $     1.10  $     0.25
    Diluted                                               1.09        0.25

Net income before unusual items
    Basic                                           $     1.22  $     0.63
    Diluted                                               1.20        0.63

Management has provided the above reconciliation of net income before
unusual items and amortization of debt discount as an additional measure
that investors can use to compare operating performance between reporting
periods. Management believes this reconciliation provides a useful
presentation of operating performance as discussed in the section "Use
of Non-GAAP Financial Measures" above. We have included the amortization
of debt discount in our analysis in order to facilitate comparison with
the non-GAAP earnings guidance provided in the "Outlook" section of this
and previous releases which exclude such expense.

Contact Information

  • CONTACT:
    CONMED Corporation
    Robert Shallish
    Chief Financial Officer
    315-624-3206

    FD
    Investors:
    Evan Smith/Brian Ritchie
    212-850-5600