Analogic Slips To Loss In Q1, Results Miss View; Shares Tumble

(RTTNews) - Medical imaging and aviation security technology provider Analogic Corp. (ALOG) on Monday reported a loss for the first quarter, reflecting lower revenues at the company's medical imaging business in addition to acquisition-related operating expenses.

Both revenues and adjusted earnings per share for the quarter missed analysts' estimates. Shares of the company declined more than 11 percent in extended trades.

Jim Green, president and CEO of Analogic said, "Our results for the first quarter saw strong double-digit revenue growth in our direct Ultrasound and Security businesses. This growth was offset in the quarter by lower revenue in our Medical Imaging business largely due to timing of OEM shipments, planned discontinuation of legacy products and the winding down of customer-funded engineering ahead of the production ramp up of a new CT product platform."

The Peabody, Massachusetts-based company's net loss for the first quarter was $3.78 million or $0.30 per share, compared to net income of $4.38 million or $0.35 per share in the year-ago period.

The latest quarter's results include acquisition-related operating and other expenses of $2.52 million pre-tax, associated with the Ultrasonix and PocketSonics acquisitions that were completed in the third quarter of fiscal 2013 and the first quarter of fiscal 2014, respectively.

Adjusted net income for the quarter was $0.82 million or $0.06 per share, compared to $6.73 million or $0.53 per share in the year-ago period. On average, analysts polled by Thomson Reuters expected the company to report earnings of $0.87 per share for the quarter. Analysts' estimates typically exclude special items.

Net revenue for the quarter decreased 8 percent to $110.08 million from $119.87 million in the same period last year. Analysts had a consensus revenue estimate of $131.35 million.

The company noted that strong revenue growth in direct Ultrasound and Security Technology was offset by timing in Medical Imaging as well as planned lower OEM Ultrasound probe sales.

Revenue from the company's Medical Imaging segment declined 21 percent from the year-ago period to $60.2 million due to several factors. This includes timing of OEM shipments, lower engineering revenue as projects began the transition to production, the end-of-life of an older generation CT product, and the exiting of a legacy non-strategic product line.

Ultrasound segment revenue rose 9 percent from last year to $34.7 million, driven by increased global sales of the company's end-user ultrasound products that includes the benefit of the acquisition of Ultrasonix, offset by lower OEM probe revenue.

Security Technology segment revenue for the quarter grew 25 percent to $15.2 million, reflecting continued growing demand for high-speed threat detection systems for aviation security.

On December 6, Analogic's board of directors declared a cash dividend of $0.10 per share for its first fiscal quarter ended October 31, 2013. The cash dividend will be payable on December 30, 2013, to shareholders of record on December 20, 2013.

Looking ahead to fiscal 2014, Analogic forecasts revenue growth in the upper single digits compared to fiscal 2013, with continued operating margin improvement as the company realizes the cost savings from the manufacturing consolidation in its ultrasound business.

For the longer term, Analogic continues to expect high single-digit organic growth, augmented by tuck-ins and new technologies, with continued improving adjusted operating margins reaching mid-teens in fiscal year 2015-2016 timeframe.

ALOG closed Monday's regular trading session at $92.65, up $0.61 or 0.66 percent on a volume of 62,254 shares. However, in after-hours, the stock declined $10.65 or 11.49 percent to $82.00.