SonoSite's 2Q profits up, but shy of estimates

by Brendon Nafziger, DOTmed News Associate Editor | July 28, 2010
U.S. hospital channel
helps drive sales
Point-of-care ultrasound maker SonoSite Inc. saw a triple-digit profit leap in its second quarter, even as its per share earnings fell short of Wall Street estimates.

The Bothell, Wash.-based business posted earnings of $1.9 million, around 12 cents per diluted share, up dramatically from its earnings of $425,000, or two cents per diluted share, from this quarter last year. The earnings boost came partly from strong sales, which rose to $62 million for the quarter, up 18 percent from this time last year. Sales were led by the U.S. hospital sector, which went up 20 percent, SonoSite said.

Sales slightly surpassed analysts' projections, although earnings per share were two pennies shy of Street estimates.

The company said it earned 29 cents a share, excluding $2.5 million acquisition costs associated with buying VisualSonics in June.

Thanks to pricing discipline and a better product mix, including offerings from CardioDynamics, bought in 2009, gross margins rose about one and a half percent to 72 percent, the company said.

"The quarter was an excellent step forward for SonoSite as we resumed strong revenue growth, and managed pricing and operating expenses effectively," SonoSite's president and CEO Kevin M. Goodwin said in a statement.

The company expects newly acquired VisualSonics to contribute around $17 million in revenues, with overall sales growth of 18 to 19 percent this year.

SonoSite's shares rose nearly 4.5 percent to hit $29.98 in recent trading on Nasdaq.