ev3 Inc. (ev3), a US-based cardiovascular devices company, has reported net sales of $100.4 million for the first quarter of 2009, compared with the net sales of $101.3 million in the year ago quarter. It has also reported net loss of $1.8 million or $0.02 per share, for the first quarter of 2009, compared with the net loss of $9.8 million or $0.09 per share, in the year ago quarter.
Guidance
Looking ahead to the fiscal year 2009, the company expects net sales to be in the range of $420 to $430 million compared to $402.2 million of product sales in 2008. Net product sales growth on a constant currency basis is expected to be about 8% to 10%. Foreign currency exchange rate fluctuations are expected to negatively impact revenue growth by 3% to 4% in 2009. ev3 expects non-GAAP adjusted earnings per share to be in the range of $0.40 to $0.45 per diluted share, an increase of $0.31 to $0.36 over 2008, based on about 105.5 million of average outstanding shares. ev3’s adjusted net earnings per share guidance excludes estimated amortization expense of about $21.8 million, non-cash stock-based compensation of about $14.5 million, vacant leased facilities reserve expense of $3.4 million and gain on the divestiture of non-strategic investment assets of $4.1 million.
Looking forward to the second quarter, the company expects net sales to be in the range of $102 to $106 million compared to $101.5 million of net product sales in the second quarter of 2008 and non-GAAP adjusted net earnings per share to be in the range of $0.06 to $0.09 per diluted share, based on about 105.2 million of average outstanding shares. ev3’s non-GAAP adjusted net earnings per share for the second quarter of 2009 excludes estimated amortization expense of about $5.7 million and non-cash stock-based compensation of about $3.6 million.
First quarter of 2009 net product sales of $100.4 million increased about 6% versus the prior year product sales. Excluding approximately $4.3 million of negative impact of foreign currency exchange rates, net product sales increased 10% versus the prior year quarter.
Robert Palmisano, president and chief executive officer of ev3, commented, With our first quarter results, we delivered a solid start to 2009. We achieved sales growth across both our neurovascular and peripheral vascular segments driven by continued market penetration of our Axium coils and Onyx liquid embolic and expansion in our international business. As expected, however, our atherectomy business faced continuing challenges during the quarter. Despite these challenges, we are beginning to see positive progress from the strategic programs that we implemented to improve our performance and remain encouraged by the strength of our legacy peripheral vascular product lines, which grew 20% on a constant currency basis during the quarter.
For the Q1 2009, ev3’s non-GAAP adjusted net income was $7.1 million, or $0.07 per diluted share. Non-GAAP adjusted net income and adjusted net earnings per share for the first quarter excludes non-cash amortization expense of $5.8 million, non-cash stock-based compensation of $3.7 million, vacant leased facilities reserve expense of $3.4 million, and a $4.1 million realized gain on the sale of non-strategic investment assets.
ev3 recorded its third consecutive quarter of positive cash flow with cash and cash equivalents increasing $7.3 million in the Q1 2009 compared to the end of the Q4 2008. Cash and cash equivalents totaled $66.9 million as of the end of first quarter of 2009. This increase was primarily due to cash generated by operations and the divestiture of non-strategic investment assets.
Palmisano continued, With strong improvement in our gross margin, continued expense control and focus on operational efficiencies, I’m very pleased with the progress we continue to make towards profitable revenue growth. We believe our improving financial performance evidences that we have the right organizational alignment and strategic programs in place to position us for future success. We will build on our strong number two position in neurovascular and continue to leverage the power of our broad peripheral vascular portfolio.