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Revenue for the second quarter was $30.1 million, an increase of approximately $2.7 million, or 10%, as compared to the second quarter 2009 revenue of $27.4 million. Results for the quarter were driven by year-over-year double-digit revenue growth in North America, Asia Pacific, and Latin America.
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Solta Medical's GAAP reported results for the second quarter of 2010 include non-cash amortization and other charges of $1.4 million related to the acquisitions of Reliant Technologies and Aesthera Corporation, non-cash stock based compensation charges of $0.6 million, and cash expenses of $0.2 million related to the acquisition of Aesthera Corporation. The Company provides additional non-GAAP financial measures that exclude these charges and expenses.
The GAAP gross profit for the quarter was $18.7 million, or 62% of net revenue. Non-GAAP gross profit for the quarter was $19.9 million, or 66% of net revenue. GAAP net income for the quarter was $1.5 million, or $0.02 per share on a diluted basis, as compared to GAAP net income of $0.1 million, or breakeven earnings per share on a diluted basis, reported for the second quarter of 2009. Non-GAAP net income for the quarter was $3.8 million, or $0.06 per share on a diluted basis, as compared to non-GAAP net income of $2.3 million, or $0.05 per share on a diluted basis, reported for the second quarter of 2009. Non-GAAP EBITDA for the second quarter was $5.0 million compared to $3.1 million in the prior year period. Cash flow from operations for the quarter was a record $7.7 million compared to cash used in operating activities of $2.8 million in the second quarter of 2009. The results for the quarter also include the previously reported patent litigation settlement with Alma Lasers under which Solta received a one-time payment of $2.25 million.
"We continue to be successful in expanding our customer base, as well as building relationships with our existing customers," said Stephen J. Fanning, Chairman, President & CEO. "Year-over-year we generated double digit revenue increases in new system sales for both Thermage® and Fraxel® brands. In addition, we are gaining traction in the marketplace with the Isolaz® brand through our recent acquisition of Aesthera. We also completed the integration of Aesthera into Solta's operations in the second quarter. Finally, our record cash flow generated from operations of $7.7 million reflects the operating benefits of having three premier brands in the aesthetic device industry, a strong IP position, and efficient management of inventories and accounts receivable."
Financial Goals for 2010
The company provided the following financial goals for 2010 :
Non-GAAP Presentation
To supplement the condensed consolidated financial information presented on a GAAP basis, management has provided non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP EBITDA, non-GAAP net income (loss) and non-GAAP earnings (loss) per share measures that exclude the impact of acquisition related adjustments, severance costs, acquisition related costs, and stock-based compensation expenses, all net of income taxes. The Company believes that these non-GAAP financial measures provide investors with insight into what is used by management to conduct a more meaningful and consistent comparison of the Company's ongoing operating results and trends, compared with historical results. This presentation is also consistent with management's internal use of the measures, which it uses to measure the performance of ongoing operating results, against prior periods and against our internally developed targets. There are limitations in using these non-GAAP financial measures because they are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. These non-GAAP financial measures should not be considered in isolation or as a substitute for GAAP financial measures. Investors and potential investors should consider non-GAAP financial measures only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP and the reconciliation of non-GAAP financial measures attached to this release.
Conference Call Information
The Company will also host a conference call and webcast today, Tuesday, August 3, 2010, at 4:30 p.m. Eastern Time (1:30 p.m. Pacific) to discuss the financial results and current corporate developments. The dial-in number for the conference call is 877-941-1465 for domestic participants and 480-629-9644 for international participants.
A taped replay of the conference call will also be available beginning approximately one hour after the call's conclusion and will remain accessible for thirty days. This replay can be accessed by dialing 800-406-7325 for domestic callers and 303-590-3030 for international callers. Callers will need to use the Passcode 4331821#. To access the live webcast of the call, go to Solta Medical's website at www.solta.com and click on Investor Relations. An archived webcast will also be available at www.solta.com.
About Solta Medical, Inc.
Solta Medical, Inc. is a global leader in the medical aesthetics market providing innovative, safe, and effective solutions for patients that enhance and expand the practice of medical aesthetics for physicians. The company offers products to address a range of skin issues under the industry's three premier brands: Thermage®, Fraxel® and Isolaz®. Thermage is an innovative, non-invasive radiofrequency procedure for tightening and contouring skin. As the leader in fractional laser technology, Fraxel delivers minimally invasive clinical solutions to resurface aging and sun damaged skin. Isolaz is the only laser or light based system indicated for the treatment of inflammatory acne, comedonal acne, pustular acne, and mild-to-moderate inflammatory acne. Since 2002, approximately one million Thermage, Fraxel and Isolaz procedures have been performed in over 100 countries. For more information about Solta Medical, call 1-877-782-2286 or log on to www.Solta.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, including statements regarding expanding distribution of Aesthera's Isolaz systems and our financial goals for 2010. Forward-looking statements are based on management's current, preliminary expectations and are subject to risks and uncertainties, which may cause Solta Medical's actual results to differ materially from the statements contained herein. Factors that might cause such a difference include the risk that physician adoption of our systems does not grow, the risk that customers do not continue to purchase treatment tips, the possibility that the market for the sale of new products does not develop as expected, and the risks relating to Solta Medical's ability to achieve its stated financial goals as a result of, among other things, economic conditions and consumer and physician confidence causing changes in consumer and physician spending habits that affect demand for our products and treatments. Further information on potential risk factors that could affect Solta Medical's business and its financial results are detailed in its Form 10-K for the year ended December 31, 2009, and other reports as filed from time to time with the Securities and Exchange Commission. Undue reliance should not be placed on forward-looking statements, especially guidance on future financial performance, which speaks only as of the date they are made. Solta Medical undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date they were made, or to reflect the occurrence of unanticipated events.
-- Revenue for the full year 2010 of approximately $115 million which represents an increase of approximately $16 million, or 16%, from revenue for the full year 2009 of $98.8 million. -- Positive non-GAAP EBITDA for every quarter of 2010. -- Non-GAAP gross margin in the range of 66% to 69% for the full year 2010 excluding non-cash amortization charges and non-cash acquisition related adjustments.
SOURCE Solta Medical, Inc.
