Thoratec Corporation, famous for its Heartmate ventricular assist device, has reported its financial results for the fourth quarter of 2012.
Rumours continue to circulate that the company remains a buyout target, with major shareholder Oracle Investment Management’s Larry Feinberg saying it would be an “undeniable” fit for Medtronic or St. Jude Medical. According to a piece on Fierce Medical Devices, here, things have been quiet on that front since last year, though, and HeartMate’s continued success can only push north any potential price tag.
For the quarter ended December 29, 2012, Thoratec reported revenues of $128.5 million, a 17 percent increase over revenues of $109.4 million in the fourth quarter of 2011. For the year revenues were $491.7 million, an increase of 16 percent over revenues of $422.7 million for fiscal year 2011.
The HeartMate product line contributed $110.8 million in the quarter, an increase of 18 percent, while the CentriMag extracorporeal blood pump product line contributed $11.5 million, an increase of 31 percent. The PVAD and IVAD product line contributed $5.6 million, a decrease of 8 percent.
For the fiscal year ended December 29, 2012, the HeartMate product line contributed $434.6 million to revenues, an increase of 19 percent, while the CentriMag product line contributed $35.7 million, an increase of 39 percent, including revenues of $6.1 million related to the acquisition of Levitronix Medical. The PVAD and IVAD product line contributed $19.0 million, a decrease of 33 percent.
For the fourth quarter of 2012, GAAP operating expenses were $64.1 million compared to $48.3 million in the same quarter last year. Non-GAAP operating expenses, described later in this press release, were $57.6 million compared to $43.0 million in the same quarter last year. The increase in non-GAAP operating expenses was due primarily to product and market development initiatives, project-related payments, and incentive compensation.
Looking forward, the company expects 2013 revenues to be in the range of $490 to $510 million, driven by growth of the HeartMate and CentriMag product lines, and partially offset by a continued decline in the PVAD and IVAD product line.
Gross margin is expected to hold up at approximately 68.5 percent on a GAAP basis and approximately 70.5 percent on a non-GAAP basis. Included in these estimates for gross margin is the impact of the U.S. medical device excise tax, which the company estimates will contribute approximately $6 million to cost of goods sold in 2013.
GAAP net income per diluted share is expected to be in the range of $1.32 to $1.42 and non-GAAP net income per diluted share is expected to be in the range of $1.76 to $1.86.
“Thoratec had an impressive year in 2012, with sales growth of 16 percent driven by our HeartMate II® and CentriMag® product lines, highlighting our leadership positions in chronic and acute mechanical circulatory support,” said Gary F. Burbach, President and Chief Executive Officer. “We were particularly pleased to finish the year with strong fourth quarter results, including 20 percent unit growth for HeartMate II on a worldwide basis, reflecting continued adoption in the U.S. Destination Therapy indication as well as in international markets.”
“We look forward to driving continued market growth and solidifying our leadership position in chronic and acute mechanical circulatory support during 2013,” Burbach commented. “Additionally, we remain focused on investing in longer-term strategic initiatives, including late-stage development activities related to HeartMate III™ and HeartMate PHP™, both of which we plan to bring into pivotal clinical trials later this year.”
Source: Thoratec, Inc., Fierce Medical Devices