SOURCE: Syneron Medical Ltd.

November 08, 2007 07:00 ET

Syneron Reports Third Quarter Results and Announces Share Repurchase Program of Up to $50 Million

YOKNEAM, ISRAEL--(Marketwire - November 8, 2007) - Syneron Medical Ltd. (NASDAQ: ELOS), an innovator in the development, marketing and sales of elos™ combined-energy medical aesthetic devices, today reported financial results for the third quarter of 2007 and announced its first share repurchase program.

Revenues for the third quarter of 2007 were $33 million and $102.9 million for the first nine months, a 26% increase compared to the same nine-month period last year. As previously reported, Syneron revenues in North America were impacted by manufacturing delays in the VelaShape and Matrix IR applicator, which have since been fully resolved. Sales remained robust internationally. In Europe sales rose 26% compared to the third quarter of 2006 and in the Asia Pacific region sales grew 34% from the same period last year. The international contribution to total revenue rose to 48%, with North American sales accounting for 52% of total sales.

Net income for the third quarter of 2007 was $8 million, or $0.28 per diluted share. The stock-based compensation expense for the third quarter was $2.5 million, or $0.09 per diluted share.

Chief Executive Officer Doron Gerstel said, "We believe that Syneron will continue to build performance momentum and we are committed to delivering that value to our shareholders. We are pleased to announce Board approval of up to $50 million in share repurchases, Syneron's first repurchase program, reflecting our outlook, cash flow and cash position. Our full-year 2007 revenue guidance is $138-140 million."

CFO Fabian Tenenbaum said, "Syneron's financial position remains strong. Syneron's cash position at the quarter's end (including long-term marketable securities) rose to $196 million, reflecting net cash from operating activities for the quarter of $7.2 million."

The Board authorized Syneron to purchase its ordinary shares in the aggregate amount of up to $50 million. Any purchases under Syneron's share repurchase program may be made from time to time in the open market and may be initiated and discontinued at any time.

Shareholders' equity at the end of the quarter totaled $233 million. Syneron has about 28 million shares outstanding.

Conference call

Syneron Management will host a conference call to discuss the results at 8:30am ET today, November 8, 2007. The webcast will be broadcast simultaneously with a slide presentation. Investors and other interested parties may access the webcast and slide presentation at http://www.visualwebcaster.com/event.asp?id=43348 or through Syneron's website at www.syneron.com. Dial-in numbers for the call are: (US) 877-888-3490, (International) +1-416-641-6135. Please login at least 10 minutes prior to the conference call in order to download the applicable audio software. Following the conclusion of the call, a replay of the webcast will be available within 24 hours at the Company's website.

About Syneron

Syneron Medical Ltd. (NASDAQ: ELOS) manufactures and distributes medical aesthetic devices that are powered by the proprietary, patented elos combined-energy technology of Bi-Polar Radio Frequency and Light. The Company's innovative elos technology provides the foundation for highly effective, safe and cost-effective systems that enable physicians to provide advanced solutions for a broad range of medical-aesthetic applications including hair removal, wrinkle reduction, rejuvenating the skin's appearance through the treatment of superficial benign vascular and pigmented lesions, and the treatment of acne, leg veins and cellulite. Founded in 2000, the corporate, R&D, and manufacturing headquarters for Syneron Medical Ltd. is located in Israel. Syneron has offices and distributors throughout the world, including North American Headquarters in Canada, North American Logistics Support Center in Irvine, CA, European Headquarters in Germany, and Asia-Pacific Headquarters in Hong Kong, which provide sales, service and support. Additional information can be found at www.syneron.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 relating to future events or our future performance, including statements with respect to our expectations regarding, but not limited to, financial forecast for 2007 and maintaining a leadership position in core markets. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied in those forward-looking statements, including, but not limited to the risk associated with our ability to commercialize new products and identify new markets for our technology; ability to manage our growth, competition and pricing pressure, risks associated with our international operations, risks associated with regulatory qualifications or approvals, and risks related to our intellectual property. These risks and other factors are summarized under the heading "Risk Factors" in our Annual Report on Form 20-F for the year ended December 31, 2006, filed with the Securities and Exchange Commission on June 15, 2007. These factors are updated from time to time through the filing of reports and registration statements with the Securities and Exchange Commission. We do not assume any obligation to update the forward-looking information contained in this press release.

Syneron, the Syneron logo, and elos are trademarks of Syneron Medical Ltd. and may be registered in certain jurisdictions. elos (Electro-Optical Synergy) is a proprietary technology of Syneron Medical Ltd. All other names are the property of their respective owners.

                           Syneron Medical Ltd.
                     CONSOLIDATED STATEMENT OF INCOME
              U.S. dollars in thousand except per share data


                              Three Months ended      Nine Months ended
                                September 30,           September 30,
                               2007        2006        2007        2006
                            (unaudited) (unaudited) (unaudited) (unaudited)
                            ----------- ----------- ----------- -----------
Revenues                         33,063      30,684     102,930      81,941
Cost of Revenues                  6,760       4,621      18,813      12,555
                            ----------- ----------- ----------- -----------
Gross Profit                     26,303      26,063      84,117      69,386

Operating expenses
Research and development          3,325       2,279       9,134       6,264
Selling and marketing            14,038      11,972      44,191      31,840
General and administrative        2,865       2,695       8,588       6,419
Other expenses
                            ----------- ----------- ----------- -----------
Total operating expenses         20,228      16,946      61,913      44,523

                            ----------- ----------- ----------- -----------
Operating Income                  6,075       9,117      22,204      24,863
Financial income, net             2,429       1,640       6,414       4,096
                            ----------- ----------- ----------- -----------
Income before taxes               8,504      10,757      28,618      28,959
Taxes on income                     550         350       1,800         859
                            ----------- ----------- ----------- -----------
Net Income                        7,954      10,407      26,818      28,100

Basic net earning per share        0.29        0.38        0.97        1.04
Diluted net earnings per
 share                             0.28        0.38        0.96        1.02
                            =========== =========== =========== ===========
Weighted average number
 of shares used in per
 share calculation
 (in thousand):
Basic                            27,760      27,306      27,687      27,105
Diluted                          27,955      27,644      27,908      27,659
                            =========== =========== =========== ===========



                           Syneron Medical Ltd.
                        CONSOLIDATED BALANCE SHEETS
                         U.S. dollars in thousand

                                                September 30, 31 December
                                                    2007          2006
                                                 (unaudited)    (audited)
                                                ------------- -------------
CURRENT ASSETS
Cash and cash equivalents (1)                          18,268        16,036
Short term deposits (1)                                     -         5,000
Marketable securities (1)                             116,813        81,493
Trade receivables                                      46,048        38,478
Other receivables and prepaid expenses                  5,173         4,890
Inventories                                             9,521         7,084
                                                ------------- -------------
Total current assets                                  195,823       152,981

LONG TERM ASSETS
Severance pay fund                                        335           368
Long-term deposits and other (1)                        1,125         1,105
Long-term available for sale marketable
 securities (1)                                        59,972        68,147
Investments in affiliated companies                     1,022             -
Property and equipment, net                             2,553         1,513
Intangible assets, net                                  5,020         1,127
                                                ------------- -------------
Long Term Assets                                       70,027        72,260

                                                ------------- -------------
Total Assets                                          265,850       225,241
                                                ============= =============

CURRENT LIABILITIES
Trade Payables                                          3,965         6,452
Other current liabilities                              23,021        19,270
                                                ------------- -------------
Total current liabilities                              26,986        25,722

LONG TERM LIABILITIES
Deferred Revenues                                       4,933         4,205
Warranty                                                  682           512
Accrued severance pay                                     371           405
                                                ------------- -------------
Total long-term liabilities                             5,986         5,122

SHAREHOLDERS' EQUITY:                                 232,878       194,397
                                                ------------- -------------
Total liabilities and shareholders' equity            265,850       225,241
                                                ============= =============

(1) Total Cash and Liquid Investments                 196,178       171,781



                           Syneron Medical Ltd.
                    CONSOLIDATED STATEMENT OF CASH FLOW
                         U.S. dollars in thousand


                              Three Months ended      Nine Months ended
                                September 30,           September 30,
                               2007        2006        2007        2006
                            (unaudited) (unaudited) (unaudited) (unaudited)
                            ----------  ----------  ----------  ----------
CASH FLOWS FROM OPERATING
 ACTIVITIES
Net income                       7,954      10,407      26,818      28,100
Adjustments to reconcile
 net income to net cash
 provided by
operating activities:
Depreciation and
 amortization                      252         173         701         525
Accrued severance pay, net         (19)        (17)         (1)         25
Increase in short-term and
 long-term trade
 receivables                    (4,402)     (3,190)     (7,570)    (11,790)
Decrease (increase) in
 other accounts receivables
 and prepaid expenses           (1,180)     (2,907)       (283)      1,910
Increase in inventories           (116)     (1,294)     (2,437)     (1,666)
Increase (decrease) in
 trade payables                   (734)        358      (2,487)      1,769
Increase (decrease) in
 other current liabilities       2,290       3,177       2,442      (1,509)
Loss (gain) on available
 for sale securities               251         (14)        200         552
Stock-based compensation         2,464       2,065       7,366       6,104
Increase in deferred
 revenues and warranty             442         964       1,567       1,489
                            ----------  ----------  ----------  ----------

Net cash provided by
 operating activities            7,202       9,722      26,316      25,509
                            ----------  ----------  ----------  ----------

CASH FLOWS FROM
 INVESTING ACTIVITIES

Investment in short-term
 deposits, net                       -           4       5,000      (5,000)
Purchase of
 available-for-sale
 securities                    (50,221)    (23,227)   (119,852)    (28,668)
Proceeds from sale of
 available-for-sale
 securities                     46,373       4,998      93,373       6,189
Payments for acquisition of
 affiliated companies, 
 long-term loans and others       (522)        (14)     (1,022)          -
Investment in long-term
 deposits and other                  -           -         (20)          -
Proceeds from long term
 loans and other                    17           -           -          17
Purchase of property and
 equipment                        (741)       (143)     (1,484)       (495)
Purchase of other assets        (3,510)          -      (3,510)          -
                            ----------  ----------  ----------  ----------

Net cash used in investing
 activities                     (8,604)    (18,382)    (27,515)    (27,957)
                            ----------  ----------  ----------  ----------

CASH FLOWS FROM FINANCING
 ACTIVITIES

Exercise of options                 75         108       3,431         314
                            ----------  ----------  ----------  ----------
Net cash provided by
 financing activities               75         108       3,431         314
                            ----------  ----------  ----------  ----------

Increase (decrease) in cash
 and cash equivalents           (1,327)     (8,552)      2,232      (2,134)
Cash and cash equivalents
 at the beginning of the
 period                         19,595      22,988      16,036      16,570
                            ----------  ----------  ----------  ----------
Cash and cash equivalents
 at the end of the period       18,268      14,436      18,268      14,436
                            ==========  ==========  ==========  ==========


Contact Information

  • For more information, please contact:

    Fabian Tenenbaum
    CFO
    +972 73 244 2329
    email: Email Contact

    Judith Kleinman
    VP Investor Relations
    +972 54 646 1688
    email: Email Contact