More Losses on Horizon Despite Healthy Revenue Growth at Volcano Corp.

Cardio/Vascular device specialist Volcano Corporation has joined the list of companies issuing their fourth quarter and full year results for 2013. Quarterly revenue was up 6 percent on a constant currency basis, but losses increased dramatically as the company accounted for significant restructuring charges in the period.

Background

Volcano Corporation offers a range of technologies that purport to make imaging and therapy simpler, more informative and less invasive. The company says its products empower physicians around the world with a new generation of analytical tools that deliver more meaningful information, using light and sound as the guiding elements.

So for Q4 ended December 31, 2013, Volcano’s revenue figure was $103.3 million, 6 percent up on Q4 2012 after currency exchange rates were factored in. For the full year revenue of $393.7 million represented an 8 percent ramp over prior year, again on a constant currency basis.

Down the income statement, a number of factors drove the net loss figure up to $20.5 million for the quarter and $34.5 million for the year. The final quarter sticks out like a sore thumb because of the company accounting for restructuring charges of $14.5 million related to a strategic reprioritization initiative that began in the third quarter of 2013. For the year these charges amounted to $19.4 million.

What to expect for 2014 then: Well, Volcano says it expects revenues to grow, on a constant currency basis to land in the range of $417.0-$425.0 million. With gross margins expected to land in the range of 64.0-64.5 percent and operating expenses, including restructuring charges of  68.0-69.0 percent of revenue, it is expecting to make another loss of $0.57-$0.60 per share (GAAP basis) or $0.16-$0.19 (non-GAAP basis).

Company comments

“Volcano had a very solid quarter throughout all of its businesses and across all of our key geographies, with particular strength in our U.S. IVUS (Intravascular Ultrasound) disposable revenues as we increased our penetration of the peripheral market and recorded contributions from the Pioneer Plus Re-Entry Catheter that we acquired in the third quarter of 2013,” said Scott Huennekens, president and chief executive officer.

“We continued to experience share gains in Europe, where we realized a greater than 20 percent increase in our combined IVUS and FFR (Fractional Flow Reserve) disposable revenues year-over-year. Also during the quarter, we initiated the roll-out of several new products, including the Pioneer Plus, our new Verrata FFR wire and the Crux IVC (inferior vena cava) filter, and continued our limited market release of our iFR (Instant Wave-Free Ratio) FFR technology in Europe and Japan. We believe these products will provide even more significant revenue contributions during 2014,” he added.

Source: Volcano Corporation, PR Newswire

 

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