Medindia LOGIN REGISTER
Medindia
Advertisement

Align Technology Announces Second Quarter Fiscal 2008 Results

Wednesday, July 30, 2008 General News
Advertisement
SANTA CLARA, Calif., July 29 Align Technology,Inc. (Nasdaq: ALGN) today reported financial results for the second quarter offiscal 2008, ended June 30, 2008.
Advertisement

Total net revenues for the second quarter of fiscal 2008 (Q2 08) were arecord $79.9 million. This reflects a year-over-year increase of 4.3 percentcompared to $76.6 million in the second quarter of 2007 (Q2 07). On asequential basis, net revenues increased 6.9 percent from $74.8 million in thefirst quarter of 2008 (Q1 08). Q2 07 shipments included approximately fourthousand cases and revenue of $5.2 million from the reduction in backlog andcycle times caused by the allocation of capacity to the Patients First Programduring the fourth quarter of 2006 and the first quarter of 2007.
Advertisement

"I'm pleased with our solid performance in the second quarter despite anever more challenging economic environment for our doctors and theirpatients," said Thomas M. Prescott, president and CEO of Align Technology."During the second quarter, we continued to execute on our strategicinitiatives including today's launch of Invisalign Teen following thesuccessful pilot of the product."

Net profit for Q2 08 was $4.0 million, or $0.06 per diluted share. This iscompared to net profit of $13.6 million, or $0.19 per diluted share in Q2 07,and net profit of $5.3 million, or $0.07 per diluted share in Q1 08.Stock-based compensation expense included in Q2 08 net profit was $4.8million, compared to $2.9 million in Q2 07, and $4.0 million in Q1 08.

The Company also announced measures to reduce operating expenses.

Prescott said, "As consumer spending has continued to soften, so has ouroutlook for revenue growth. As a result, we're reducing overall companyspending and slowing headcount growth while preserving the importantinvestments in strategic priorities. Unfortunately, valued employees will beaffected, and those are decisions that the management team and I do not takelightly. These actions are only the first steps in actively reducing our coststructure and moving towards a financial model with greater operatingleverage."

The cost-saving measures include: a reduction in full time headcount of38, slowing headcount growth for the remainder of 2008, and cuts indiscretionary spending. These actions will reduce expenses in the second halfof 2008 by approximately $5 million to $6 million. In addition, the companyis implementing a phased consolidation of its order acquisition operations inSanta Clara, California into its existing operations in Juarez, Mexico by theend of 2008. Upon completion, 29 positions in Santa Clara will be eliminated,resulting in annualized cost savings of approximately $1.0 to $1.5 million in2009. As part of these actions, Align will record a restructuring chargeestimated to be approximately $2.6 million in the second half of fiscal 2008,of which approximately $2.2 million will be realized in Q3 08. At the end ofQ2 08, Align had a regular employee base of approximately 1,400 worldwide.

Liquidity and Capital Resources

As of June 30, 2008, Align had $110.1 million in cash, cash equivalents,and short term marketable securities compared to $127.9 million as of December31, 2007. During Q2 08, Align purchased 2.2 million shares at an average priceof $12.65 per share for a total of $27.7 million. There remains $22.3 millionunder the Company's existing stock repurchase authorization.

Key Business Metrics

The following table highlights business metrics for Align's second quarterof 2008. Additional historical information is available on the Company'swebsite at http://investor.aligntech.com.

Business Outlook

For the third quarter of fiscal 2008 (Q3 08), Align Technology expects netrevenues to be in a range of $74 million to $76 million. GAAP earnings perdiluted share for Q3 08 is expected to be in a range of $0.01 to $0.03.Non-GAA
Sponsored Post and Backlink Submission


Latest Press Release on General News

This site uses cookies to deliver our services.By using our site, you acknowledge that you have read and understand our Cookie Policy, Privacy Policy, and our Terms of Use  Ok, Got it. Close