UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

March 8, 2012 Date of Report (Date of earliest event reported): March 8, 2012

 

 

THE COOPER COMPANIES, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware		1-8597		94-2657368
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

6140 Stoneridge Mall Road, Suite 590, Pleasanton, California 94588

(Address of principal executive offices)

(925) 460-3600

(Registrant’s telephone number, including area code)

 

 

Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

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ITEM 2.02. Results of Operations and Financial Condition.

On March 8, 2012, The Cooper Companies, Inc. issued a press release reporting results for its fiscal first quarter ended January 31, 2012. A copy of this release is attached and incorporated by reference.

Internet addresses in the release are for information purposes only and are not intended to be hyperlinks to other The Cooper Companies, Inc. information.

ITEM 9.01. Financial Statements and Exhibits.

 

(d)

Exhibits.

 

Exhibit		Description
99.1		Press Release dated March 8, 2012, of The Cooper Companies, Inc.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Dated: March 8, 2012

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EXHIBIT INDEX

 

Exhibit		Description
99.1		Press Release dated March 8, 2012, of The Cooper Companies, Inc.

Exhibit 99.1

 

NEWS RELEASE		6140 Stoneridge Mall Road Suite 590 Pleasanton, CA 94588 925-460-3663 www.coopercos.com
CONTACT: Kim Duncan Sr. Director, Investor Relations ir@cooperco.com

THE COOPER COMPANIES ANNOUNCES FIRST QUARTER 2012 RESULTS

PLEASANTON, Calif., March 8, 2012 — The Cooper Companies, Inc. (NYSE: COO) today announced financial results for the fiscal first quarter ended January 31, 2012.

 

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Revenue increased 11% year-over-year to $326.1 million. CooperVision (CVI) revenue up 10% to $268.9 million and CooperSurgical (CSI) revenue up 15% to $57.2 million.

 

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GAAP earnings per share (EPS) $1.12, up 29 cents or 35% from last year’s first quarter.

 

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Fiscal 2012 EPS guidance revised upward.

Commenting on the results, Robert S. Weiss, Cooper’s president and chief executive officer said, “We are pleased with our performance in the first quarter. Our strategy remains the same and our execution is illustrated in the numbers. We grew top line faster than our markets, we invested in our infrastructure with a focus on sales and marketing and research and development, and we posted double-digit earnings growth.”

First Quarter GAAP Operating Highlights

 

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Revenue $326.1 million, 11% above first quarter 2011, 11% in constant currency.

 

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Gross margin 65% compared with 60% in last year’s first quarter. The improvement was primarily the result of savings related to the closure of the Norfolk manufacturing plant completed in the fiscal first quarter of 2011, increased manufacturing efficiencies, and product mix.

 

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Operating margin 19% compared with 17% in last year’s first quarter. The increase was driven by the improvement in gross margin offset by investments in sales, marketing, and research and development, and increased amortization expense.

 

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Depreciation expense $20.2 million, up 11% from last year’s first quarter. Amortization $5.6 million, up 18% from last year’s first quarter as a result of acquired intangible assets related to recent acquisitions.

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Interest expense $3.7 million compared with $7.0 million in last year’s first quarter.

 

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Total debt increased $29.9 million in the quarter to $410.3 million, due primarily to share repurchases.

 

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Cash provided by operations $41.6 million, capital expenditures $20.0 million, insurance recovery $1.6 million resulted in free cash flow of $23.2 million.

First Quarter CooperVision (CVI) GAAP Operating Highlights

 

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Revenue $268.9 million, up 10% from last year’s first quarter, 10% in constant currency.

 

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Revenue by category:

 

		(In millions) 1Q12				% of CVI Revenue 1Q12				%chg y/y				Constant  Currency %chg y/y
Toric		$	81.8				30	%			8	%			9	%
Multifocal			20.8				8	%			25	%			26	%
Single-use sphere			60.4				23	%			14	%			10	%
Non single-use sphere, other			105.9				39	%			8	%			8	%
Total		$	268.9				100	%			10	%			10	%

 

•

Revenue by geography:

 

		(In millions) 1Q12				% of CVI Revenue 1Q12				%chg y/y				Constant  Currency %chg y/y
Americas		$	106.0				39	%			10	%			11	%
EMEA			95.4				36	%			5	%			7	%
Asia Pacific			67.5				25	%			19	%			13	%
Total		$	268.9				100	%			10	%			10	%

 

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Selected revenue by material:

 

		(In millions) 1Q12				% of CVI  Revenue 1Q12				%chg y/y				Constant  Currency %chg y/y
Proclear®		$	70.8				26	%			7	%			6	%
Silicone hydrogel		$	86.9				32	%			39	%			40	%

 

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Gross margin 64% compared with 59% in the first quarter of 2011. The improvement was the result of savings related to the closure of the Norfolk manufacturing plant completed in the fiscal first quarter of 2011, increased manufacturing efficiencies, and product mix, primarily the shift to higher margin silicone hydrogel products.

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First Quarter CooperSurgical (CSI) GAAP Operating Highlights

 

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Revenue $57.2 million, up 15% from last year’s first quarter, up 9% excluding acquisitions.

 

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Revenue by category:

 

		(In millions) 1Q12				% of CSI Revenue 1Q12				%chg y/y
Office, other		$	30.5				53	%			10	%
Surgical procedures			22.9				40	%			24	%
Fertility			3.8				7	%			10	%
Total		$	57.2				100	%			15	%

 

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Gross margin 67%, up from 64% in last year’s first quarter. The improvement in gross margin was largely a result of manufacturing efficiency improvements and product mix including higher margin products used in surgical procedures.

Other Items

 

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Share repurchases $46.1 million or approximately 663,000 shares.

 

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IRS Notice of Deficiency for the tax years 2005 and 2006 settled, resulting in a favorable adjustment to the effective tax rate.

2012 Guidance

The Company revises upward its full-year 2012 EPS guidance. Guidance is summarized as follows:

 

		FY12 Guidance Old		FY12 Guidance New
Revenues (In millions)
Total		$1,385-$1,440		$1,385-$1,440
CVI		$1,170-$1,210		$1,170-$1,210
CSI		$215-$230		$215-$230
EPS
GAAP		$4.80-$5.00		$4.90-$5.15
Non-GAAP		$4.80-$5.00		$4.90-$5.15
Free Cash Flow (In millions)		$200-$230		$200-$230

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Conference Call and Webcast

The Company will host a conference call today at 5:00 PM ET to discuss its fiscal first quarter 2012 financial results. The dial in number in the United States is +1-800-435-1261 and outside the United States is +1-617-614-4076. The passcode is 38162301. There will be a replay available approximately two hours after the call ends until Thursday, March 15, 2012. 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 23691259. This call will be broadcast live on our website at www.coopercos.com and at www.streetevents.com. A transcript will be available on our website 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 crafting 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 over 7,000 employees with products sold in over 100 countries. For more information, please visit www.coopercos.com.

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 2012 Guidance and all statements regarding anticipated growth in our revenue, 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

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general business, political and economic conditions due to the current global economic downturn, including the impact of continuing uncertainty and instability of United States and international credit markets that may adversely affect the Company’s or its customers’ ability to meet future liquidity needs; reduced sales, loss of customers, and costs and expenses related to the recall of certain lots of Avaira Toric and Avaira Sphere contact lenses and any additional adverse impact if this recall is expanded in the future; delays in obtaining, or failure to obtain, FDA approval to return Avaira Toric to market; 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; legal costs, insurance expenses, settlement costs and the risk of an adverse decision or settlement related to product liability, patent or other litigation; limitations on sales following new product introductions due to poor market acceptance; new competitors, product innovations or technologies; the impact of acquisitions or divestitures on revenues, earnings or margins; interest rate and foreign currency exchange rate fluctuations; the requirement to provide for a significant liability or to write off, or accelerate depreciation on, a significant asset, including goodwill; changes in United States and foreign government regulations of the retail optical industry and of the healthcare industry generally; changes in tax laws or their interpretation and changes in effective tax rates; dilution to earnings per share from acquisitions or issuing stock 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, 2011, 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.

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THE COOPER COMPANIES, INC. AND SUBSIDIARIES

Consolidated Condensed Balance Sheets

(In thousands)

(Unaudited)

 

		January 31, 2012				October 31, 2011
ASSETS
Current assets:
Cash and cash equivalents		$	7,681			$	5,175
Trade receivables, net			200,160				214,779
Inventories			272,774				253,584
Deferred tax assets			29,113				33,684
Other current assets			45,535				33,125
Total current assets			555,263				540,347
Property, plant and equipment, net			583,239				609,205
Goodwill			1,272,030				1,276,567
Other intangibles, net			122,873				128,341
Deferred tax assets			21,213				21,828
Other assets			44,649				48,230
		$	2,599,267			$	2,624,518
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short-term debt		$	39,191			$	52,979
Other current liabilities			167,201				214,227
Total current liabilities			206,392				267,206
Long-term debt			371,114				327,453
Other liabilities			65,776				72,244
Deferred tax liabilities			18,628				20,127
Total liabilities			661,910				687,030
Stockholders’ equity			1,937,357				1,937,488
		$	2,599,267			$	2,624,518

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THE COOPER COMPANIES, INC. AND SUBSIDIARIES

Consolidated Statements of Income

(In thousands, except earnings per share amounts)

(Unaudited)

 

		Three Months Ended January 31,
		2012				2011
Net sales		$	326,060			$	293,229
Cost of sales			115,607				116,623
Gross profit			210,453				176,606
Selling, general and administrative expense			131,748				113,453
Research and development expense			11,425				9,727
Amortization of intangibles			5,552				4,713
Operating income			61,728				48,713
Interest expense			3,662				6,951
Other income (loss), net			681				(734	)
Income before income taxes			58,747				41,028
Provision for income taxes			4,124				1,813
Net income		$	54,623			$	39,215
Diluted earnings per share		$	1.12			$	0.83
Number of shares used to compute earnings per share			48,792				47,391

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Soft Contact Lens Revenue Update

Worldwide Market vs. CooperVision (Constant Currency)

The data below is extracted from a compilation of industry participants’ revenue by the Contact Lens Institute (CLI), an independent market research firm. This data is compiled using gross product sales at foreign exchange rates set by CLI. It therefore excludes items such as discounts, rebates, currency hedges and freight reimbursements.

Worldwide Manufacturers’ Soft Contact Lens Revenue

(U.S. dollars in millions; constant currency; unaudited)

 

		Calendar 4Q11												Calendar 2011
		Market				Market Change				CVI Change				Market				Market Change				CVI Change
Sales by Category
Spheres		$	1,282				4	%			6	%		$	5,252				3	%			6	%
Torics			314				8	%			10	%			1,297				7	%			10	%
Multifocal			85				10	%			16	%			327				7	%			3	%
WW Soft Contact Lenses		$	1,681				5	%			7	%		$	6,876				4	%			7	%
Sales by Modality
Single-use		$	646				11	%			8	%		$	2,586				9	%			9	%
Other			1,035				2	%			7	%			4,290				2	%			6	%
WW Soft Contact Lenses		$	1,681				5	%			7	%		$	6,876				4	%			7	%
Sales by Material
Hydrogel		$	957				0	%			(4	%)		$	3,937				(1	%)			(5	%)
Silicone Hydrogel			724				12	%			37	%			2,939				12	%			41	%
WW Soft Contact Lenses		$	1,681				5	%			7	%		$	6,876				4	%			7	%
Sales by Geography
Americas		$	617				6	%			11	%		$	2,611				4	%			6	%
EMEA			492				5	%			4	%			1,993				5	%			7	%
Asia Pacific			572				5	%			8	%			2,272				4	%			9	%
WW Soft Contact Lenses		$	1,681				5	%			7	%		$	6,876				4	%			7	%
United States		$	522				7	%			11	%		$	2,239				5	%			6	%
International			1,159				5	%			5	%			4,637				4	%			7	%
WW Soft Contact Lenses		$	1,681				5	%			7	%		$	6,876				4	%			7	%

COO-E

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