According to CEO Richard Packer, Zoll Medical Corp. “took it on the chin” during the fourth quarter and much of 2009, on the ropes as slumping spending on big-ticket equipment hit its top- and bottom-line results.
The Chelmsford, Mass.-based resuscitation device maker posted sales of $385.2 million during fiscal 2009, down 3.2 percent compared with $398 million during the prior year. Annual net income slumped 59.2 percent to $9.6 million, compared with $23.4 million during fiscal 2008.
During the three months ended Sept. 27, Zoll reported sales of $107.9 million, up 2.2 percent compared with $105.6 million during the fourth quarter last year. Net income plunged to $3.4 million, however, compared with $8.9 million during Q4 2008, a 61.7 percent slide.
The slide hit Zoll’s AutoPulse cardiac support pump particularly hard during the fourth quarter, Packer said.
“We clearly took it on the chin in Q4 as compared to last year’s Q4, squarely related to the capital equipment spending constraints,” he said. “Results [for the AutoPulse] were consistent with Q3 so at least we held steady.”
Foreign exchange rates also pasted one on the company, punching full-year sales down by $12 million. That blow was partially offset by a $6.9 million contribution from the temperature management business Zoll bought from Alsius Corp. in May. The unit brought in $5 million during the fourth quarter.
It wasn’t all black eyes for the company, particularly regarding the LifeVest automated external defibrillator. The device won clearance from the Food & Drug Administration in August. Packer said the company’s investment in the product is starting to show some returns.
“The LifeVest product performed very well again this quarter, as we invest heavily in this product. Revenue growth for the year exceeded 65 percent and we brought our total number of LifeVest sales representatives to 89 by the end of the fiscal year,” he said in a statement. “While 2009 was a challenging year for us in the capital equipment portion of the business, we did make progress. Our 2010 plan is unchanged as we continue to invest in our growth engines including LifeVest, temperature management, and the AutoPulse. We believe our core hospital business will rebound, particularly in the back half of 2010, as economic conditions improve. Additionally, based on current foreign exchange rates, we will not face the same headwind in 2010 that we faced in 2009. Overall, our resuscitation product portfolio continues to strengthen, positioning us to improve profitability as the economic recovery continues and we move through 2010.”
