Press Release


The Cooper Companies Announces First Quarter 2014 Results

PLEASANTON, Calif., March 6, 2014 (GLOBE NEWSWIRE) -- The Cooper Companies, Inc. (NYSE:COO) today announced financial results for the fiscal first quarter ended January 31, 2014.

  • Revenue increased 7% year-over-year to $405.0 million, up 11% in constant currency and excluding the divestiture of Aime. CooperVision (CVI) revenue up 8% to $326.3 million, up 14% in constant currency and excluding the divestiture of Aime. CooperSurgical (CSI) revenue up 0.3% to $78.7 million.
  • GAAP earnings per share (EPS) and non-GAAP EPS of $1.47, down 3 cents or 2% and up 24 cents or 20% year over year, respectively.

Commenting on the results, Robert S. Weiss, Cooper's president and chief executive officer said, "We are very pleased to report a strong first quarter. CooperVision continued to gain share in all geographies and modalities with silicone hydrogel products showing especially strong growth led by Biofinity®. CooperSurgical also continued to post solid revenue growth in fertility. Our businesses continue to perform well and we remain excited about the future."

First Quarter GAAP Operating Highlights

  • Revenue $405.0 million, up 7% from last year's first quarter, 11% excluding currency and the divestiture of Aime (CVI's rigid gas permeable contact lens and solutions business in Japan, sold effective October 31, 2013).
  • Gross margin 65% compared with 63% in last year's first quarter. Gross margin was positively impacted by a lower royalty payment on silicone hydrogel lens sales and favorable product mix, partially offset by lower revenue due to currency, primarily the yen.
  • Operating margin 20% compared with 18% in last year's first quarter. The increase was the result of gross margin improvement and SG&A leverage. 
  • Depreciation $23.9 million, down 1% from last year's first quarter. Amortization $7.5 million, up 2% from last year's first quarter.
  • Total debt increased $1.1 million from October 31, 2013 to $345.7 million. Interest expense $1.7 million compared with $2.6 million in last year's first quarter.
  • Cash provided by operations $68.6 million, capital expenditures $61.0 million and insurance recovery of $1.4 million, resulted in free cash flow $9.0 million
  • Shares repurchased $50.0 million (396 thousand shares).

First Quarter CooperVision GAAP Operating Highlights

  • Revenue $326.3 million, up 8% from last year's first quarter, 14% in constant currency and excluding the divestiture of Aime.
  • Revenue by category:  
        Constant Currency
  (In millions) % of CVI Revenue %chg %chg
  1Q14 1Q14 y/y y/y
Toric  $ 101.2 31% 10% 12%
Multifocal  33.7 10% 24% 24%
Single-use sphere  68.8 21% 5% 14%
Non single-use sphere, other  122.6 38% 5% 6%
Total  $ 326.3 100% 8% 11%
  • Revenue by geography:
        Constant Currency
   (In millions)  % of CVI Revenue %chg %chg
   1Q14  1Q14 y/y y/y
Americas  $ 140.7 43% 13% 13%
EMEA  117.9 36% 16% 13%
Asia Pacific  67.7 21% -9% 6%
Total  $ 326.3 100% 8% 11%
  • Selected revenue by material:
        Constant Currency
   (In millions)  % of CVI Revenue %chg %chg
   1Q14  1Q14 y/y y/y
Silicone hydrogel  $ 154.2 47% 29% 30%
Proclear®  $ 82.6 25% 9% 12%
  • Gross margin 65% compared with 63% in last year's first quarter. Gross margin was positively impacted by a lower royalty payment on silicone hydrogel lens sales and favorable product mix, partially offset by lower revenue due to currency, primarily the yen.

First Quarter CooperSurgical GAAP Operating Highlights

  • Revenue $78.7 million, up 0.3% from last year's first quarter.
  • Revenue by category:
  (In millions) % of CSI Revenue %chg
  1Q14 1Q14 y/y
Office and surgical procedures  $ 50.8 65% -6%
Fertility  27.9 35% 15%
Total  $ 78.7 100% 0%
  • Gross margin 63% compared with 64% in last year's first quarter. The decrease was primarily the result of lower margins associated with the fertility business.

2014 Guidance

The Company revises its full year fiscal 2014 guidance. Guidance is summarized as follows:

  FY14 Guidance FY14 Guidance
  Old New
Revenues (In millions)    
Total $ 1,675 -- $1,735 $ 1,685 -- $1,725
CVI $ 1,355 -- $1,395 $ 1,365 -- $1,395
CSI $ 320 -- $340 $ 320 -- $330
GAAP $ 6.70 -- $7.00 $ 6.75 -- $7.00
Non-GAAP $ 6.70 -- $7.00 $ 6.75 -- $7.00

Guidance assumes constant currency as of March 6, 2014.

Reconciliation of Non-GAAP EPS to GAAP EPS

To supplement our financial results presented on a GAAP basis, we use non-GAAP measures that we believe are helpful in understanding our results. The non-GAAP measures exclude, in our fiscal first quarter 2013, insurance proceeds related to a business interruption claim and costs related to acquisitions. Our non-GAAP financial results and guidance are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated financial statements and guidance prepared in accordance with GAAP. Management uses supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. These non-GAAP measures are among the factors management uses in planning and forecasting for future periods.

We also report revenue growth using the non-GAAP financial measure of constant currency revenue. Management presents and refers to constant currency information so that revenue results may be evaluated excluding the effect of foreign currency rate fluctuations. To present this information, current period revenue for entities reporting in currencies other than United States dollars are converted into United States dollars at the average foreign exchange rates for the corresponding period in the prior year. To report revenue growth excluding the October 31, 2013 divestiture of Aime, we excluded fiscal first quarter of 2013 revenue of $7.2 million.

Conference Call and Webcast

The Company will host a conference call today at 5:00 PM ET to discuss its fiscal first quarter 2014 financial results and current corporate developments. The dial-in number in the United States is 1-877-415-3184 and outside the United States is +1-857-244-7327. The passcode is 65586455. There will be a replay available approximately two hours after the call ends until Thursday, March 13, 2014. The replay number in the United States is 1-888-286-8010 and outside the United States is +1-617-801-6888. The replay passcode is 26297443. This call will also be broadcast live at and a transcript will be available following the conference call.

About The Cooper Companies

The Cooper Companies, Inc. ("Cooper") is a global medical device company publicly traded on the NYSE Euronext (NYSE:COO). Cooper is dedicated to being A Quality of Life Company™ with a focus on delivering shareholder value. Cooper operates through two business units, CooperVision and CooperSurgical. CooperVision brings a refreshing perspective on vision care with a commitment to developing a wide range of high-quality products for contact lens wearers and providing focused practitioner support. CooperSurgical focuses on supplying women's health clinicians with market leading products and treatment options to improve the delivery of healthcare to women. Headquartered in Pleasanton, CA, Cooper has approximately 8,000 employees with products sold in over 100 countries. For more information, please visit

Forward-Looking Statements

This news release contains "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995. Statements relating to guidance, plans, prospects, goals, strategies, future actions, events or performance and other statements which are other than statements of historical fact, including our 2014 Guidance and all statements regarding anticipated growth in our revenue, anticipated effects of any product recalls, anticipated market conditions, planned product launches and expected results of operations and integration of any acquisition are forward-looking. To identify these statements look for words like "believes," "expects," "may," "will," "should," "could," "seeks," "intends," "plans," "estimates" or "anticipates" and similar words or phrases.  Forward-looking statements necessarily depend on assumptions, data or methods that may be incorrect or imprecise and are subject to risks and uncertainties. 

Among the factors that could cause our actual results and future actions to differ materially from those described in forward-looking statements are: adverse changes in the global or regional general business, political and economic conditions due to the current global economic downturn, including the impact of continuing uncertainty and instability of certain European Union countries that could adversely affect our global markets; foreign currency exchange rate and interest rate fluctuations including the risk of further declines in the value of the yen and the euro that would decrease our revenues and earnings; acquisition related adverse effects including the failure to successfully obtain the anticipated revenues, margins and earnings benefits of acquisitions, integration delays or costs and the requirement to record significant adjustments to the preliminary fair value of assets acquired and liabilities assumed within the measurement period; a major disruption in the operations of our manufacturing, research and development or distribution facilities due to technological problems, natural disasters or other causes; disruptions in supplies of raw materials, particularly components used to manufacture our silicone hydrogel lenses; limitations on sales following product introductions due to poor market acceptance; new competitors, product innovations or technologies; reduced sales, loss of customers, and costs and expenses related to recalls; new U.S. and foreign government laws and regulations, and changes in existing laws, regulations and enforcement guidance, which affect the medical device industry and the healthcare industry generally; failure to receive, or delays in receiving, U.S. or foreign regulatory approvals for products; failure to obtain adequate coverage and reimbursement from third party payors for our products; compliance costs and potential liability in connection with U.S. and foreign healthcare regulations, including product recalls, and potential losses resulting from sales of counterfeit and other infringing products; legal costs, insurance expenses, settlement costs and the risk of an adverse decision or settlement related to product liability, patent protection or other litigation; changes in tax laws or their interpretation and changes in statutory tax rates; the requirement to provide for a significant liability or to write off, or accelerate depreciation on, a significant asset, including goodwill; the success of the Company's research and development activities and other start-up projects; dilution to earnings per share from acquisitions or issuing stock; changes in accounting principles or estimates; environmental risks and other events described in our Securities and Exchange Commission filings, including the "Business" and "Risk Factors" sections in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2013, as such Risk Factors may be updated in quarterly filings. 

We caution investors that forward-looking statements reflect our analysis only on their stated date. We disclaim any intent to update them except as required by law.

Consolidated Condensed Balance Sheets
(In thousands)
  January 31, October 31,
  2014 2013
Current assets:    
Cash and cash equivalents $ 28,828 $ 77,393
Trade receivables, net 235,288 229,537
Inventories 339,496 338,917
Deferred tax assets 35,499 41,179
Other current assets 61,983 60,215
Total current assets 701,094 747,241
Property, plant and equipment, net 769,397 739,867
Goodwill 1,387,983 1,387,611
Other intangibles, net 190,812 198,769
Deferred tax assets 18,885 16,279
Other assets 46,584 47,494
  $ 3,114,755 $ 3,137,261
Current liabilities:    
Short-term debt $ 44,147 $ 42,987
Other current liabilities 224,160 278,266
Total current liabilities 268,307 321,253
Long-term debt 301,589 301,670
Deferred tax liabilities 24,447 24,883
Other liabilities 66,503 65,961
Total liabilities 660,846 713,767
Total Cooper stockholders' equity 2,435,279 2,404,535
Noncontrolling interests 18,630 18,959
Stockholders' equity 2,453,909 2,423,494
  $ 3,114,755 $ 3,137,261
Consolidated Statements of Income
(In thousands, except earnings per share amounts)
  Three Months Ended
  January 31,
  2014 2013
Net sales $ 404,980 $ 379,839
Cost of sales 142,051 139,341
Gross profit 262,929 240,498
Selling, general and administrative expense 158,088 150,653
Research and development expense 15,712 13,653
Amortization of intangibles 7,507 7,371
Operating income 81,622 68,821
Interest expense 1,656 2,567
Gain on insurance proceeds -- 14,084
Other (expense) income, net (510) 638
Income before income taxes 79,456 80,976
Provision for income taxes 7,191 6,041
Net income 72,265 74,935
Income attributable to noncontrolling interests 422 268
Net income attributable to Cooper stockholders $ 71,843 $ 74,667
Diluted earnings per share attributable to Cooper stockholders $ 1.47 $ 1.50
Number of shares used to compute earnings per share attributable to Cooper stockholders 49,006 49,633

Soft Contact Lens Revenue Update

Worldwide Manufacturers' Soft Contact Lens Revenue    
 (U.S. dollars in millions; constant currency; unaudited)    
  Calendar 4Q13 Trailing Twelve Months 2013
    Market CVI   Market CVI
  Market Change Change Market Change Change
Sales by Modality            
Single-use  $ 787 12% 19%  $ 3,080 10% 18%
Other  1,053 3% 11%  4,389 2% 9%
WW Soft Contact Lenses  $ 1,840 6% 13%  $ 7,469 5% 11%
Sales by Geography            
Americas  $ 692 8% 15%  $ 2,955 6% 12%
EMEA  520 5% 12%  2,100 4% 9%
Asia Pacific  628 6% 10%  2,414 5% 12%
WW Soft Contact Lenses  $ 1,840 6% 13%  $ 7,469 5% 11%

Source: Management estimates and independent market research


CONTACT: Kim Duncan

         Senior Director, Investor Relations


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Source: The Cooper Companies, Inc.

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