AngioDynamics Reports Fiscal 2014 Second Quarter Financial Results

AngioDynamics Reports Fiscal 2014 Second Quarter Financial Results

  *Net sales of $88.6 million
  *GAAP income per share at break-even; Non-GAAP adjusted net income,
    excluding amortization, of $0.14 per share
  *Adjusted EBITDA of $12.7 million
  *Operating cash flow of $8.2 million
  *Company raises low end of revenue guidance to $349-$353 million for FY14;
    reiterates adjusted EPS, excluding amortization, of $0.63-$0.67

ALBANY, N.Y., Jan. 9, 2014 (GLOBE NEWSWIRE) -- AngioDynamics (Nasdaq:ANGO), a
leading provider of innovative, minimally invasive medical devices for
vascular access, surgery, peripheral vascular disease and oncology, today
reported financial results for the fiscal 2014 second quarter ended November
30, 2013.

"AngioDynamics' better than expected sales reflects improved performance in
our three businesses – Peripheral Vascular, Vascular Access and
Oncology/Surgery – compared to the prior quarter. Our new products,
specifically AngioVac, BioFlo PICCs and ports, and the Acculis microwave
system, represent disruptive emerging technologies that are contributing to
our growth while improving patient outcomes and reducing costs to the
healthcare system," said Joseph M. DeVivo, President and Chief Executive
Officer. "Having stabilized our U.S business while successfully introducing
new products to the market, we have taken actions to improve our international
operations, which can potentially be a more significant contributor to our
future results. We entered the second half of our fiscal year with strong
momentum and believe we are well-positioned to meet our financial goals for
2014."

Q2 FY14 Financial Results

Net sales of $88.6 million were up 2% compared with last year's second quarter
net sales of $87 million. Excluding the planned wind-down of the supply
agreement with Boston Scientific (BSC), second quarter sales were up 3% to $87
million compared to $84.5 million in last year's second quarter. The following
sales comparisons exclude the BSC supply agreement.

Peripheral Vascular net sales in the second quarter increased 7% to $48.9
million compared to $45.8 million in the prior year period. Vascular Access
net sales declined 4% to $25.6 million compared to $26.7 million in the year
ago quarter. Oncology/Surgery net sales of $12.6 million increased 5% compared
to the year ago quarter. Net sales in the U.S. increased 3% to $69.5 million
from $67.4 million in the prior year period, and International net sales were
up 1% at $17.5 million compared to the year-ago period.

The Company's net loss in the second quarter was $0.1 million, or break-even
on a per share basis, compared to net income of $2.0 million, or $0.06 per
share, a year ago. Excluding the items shown in the attached quarterly
non-GAAP reconciliation table, adjusted net income excluding amortization for
intangible assets was $5.0 million, or $0.14 per share, for the second quarter
of fiscal year 2014 compared to net income of $6.1 million, or $0.17 per
share, for the year ago quarter.

Second quarter EBITDA was $7.8 million, or $0.22 per share, compared to EBITDA
of $11.4 million, or $0.32 per share, a year ago. Adjusted EBITDA, excluding
the items shown in the attached reconciliation table, was $12.7 million, or
$0.36 per share, compared to $15 million, or $0.43 per share, in the year ago
period.

Second quarter operating cash flow was $8.2 million. Year-to-date operating
cash flow was $15.8 million versus $5.5 million in the prior year. At November
30, 2013, cash and investments were $17 million and debt was $140.2 million.

Recent Operational Highlights

  *The Company's growth drivers are continuing to deliver positive results.
    Data presented at the recent AVA meeting supports the clinical
    effectiveness and economic impact of BioFlo, which now accounts for over
    30% of the Company's global PICC revenue; while AngioVac technology is
    demonstrating increased market awareness.
  *The Centers for Medicare and Medicaid Services (CMS) created a new
    Ambulatory Payment Classification (APC) that includes both in-hospital
    endovenous radiofrequency (RF) treatments and in-hospital endovenous laser
    varicose vein ablation, such as the Company's VenaCure EVLT procedure,
    increasing payment for laser vein ablation by 9% while creating parity for
    thermal varicose vein ablation procedures.
  *AngioDynamics received EU CE Mark approval for its AngioVac venous
    drainage cannula and cardiopulmonary bypass circuit for use during
    extracorporeal bypass for up to six hours, with the AngioVac cannula also
    being approved for removal of fresh, soft thrombi or emboli.
  *The Company announced an operational excellence program designed to save
    $15 million to $18 million during the next three years by creating greater
    efficiencies and improving business performance through product
    rationalization, lean initiatives, supply chain optimization, ERP
    implementation and changes to its New York footprint.
  *John Sotowas appointed Chief Commercial Officer overseeing global sales
    and marketing initiatives as the Company seeks to accelerate its
    international business which currently contributes approximately 20% of
    net sales. Mr. Soto is the current leader of the Peripheral Vascular
    business, which grew sales 7% U.S. in the fiscal second quarter of 2014.

Six Months Financial Results

For the six months ended November 30, 2013, net sales were $172.2 million, a
1% increase compared to the $170.4 million reported a year ago. The Company's
net loss was $0.5 million, or $0.01 per share, compared to net income of $1.2
million, or $0.04 per share, reported a year ago. Excluding the items shown in
the attached quarterly non-GAAP reconciliation table, adjusted net income
excluding amortization for intangible assets was $9.1 million, or $0.26 per
share, compared to net income of $12 million, or $0.34 per share, a year ago.
EBITDA was $15.1 million, or $0.43 per share, compared to EBITDA of $18
million, or $0.51 per share, a year ago. Adjusted EBITDA, excluding the items
shown in the attached reconciliation table, was $24 million, or $0.68 per
share, compared to $29.4 million, or $0.83 per share, in the year ago period.

Fiscal 2014 Guidance

"As a result of our stronger than anticipated first half of our fiscal year,
we are raising the low end of our revenue guidance to $349 million to $353
million," said Mark Frost, Executive Vice President and Chief Financial
Officer. "We also expect to report adjusted EPS, excluding amortization, of
$0.63 to $0.67 per share, which is consistent with our prior guidance.

"We are anticipating revenue to range from $85 million to $88 million in the
fiscal third quarter of 2014, a 4% to 8% increase at the top end compared with
the year ago fiscal third quarter," Frost continued. "Adjusted EPS, excluding
amortization, is expected to be $0.15 to $0.18 per share."

Conference Call

AngioDynamics will host a conference call today at 4:30 p.m. Eastern Time to
discuss its first quarter results. To participate in the live call, please
dial 1-877-941-8609. In addition, a live webcast and archived replay of the
call will be available at http://investors.angiodynamics.com. To access the
live webcast, please go to the website 15 minutes prior to its start to
register, download and install the necessary software.

Use of Non-GAAP Measures

Management uses non-GAAP measures to establish operational goals, and believes
that non-GAAP measures may assist investors in analyzing the underlying trends
in AngioDynamics' business over time. Investors should consider these non-GAAP
measures in addition to, not as a substitute for or as superior to, financial
reporting measures prepared in accordance with GAAP. In this news release,
AngioDynamics has reported EBITDA (income before interest, taxes, depreciation
and amortization), adjusted EBITDA, adjusted net income and adjusted earnings
per share. Management uses these measures in its internal analysis and review
of operational performance. Management believes that these measures provide
investors with useful information in comparing AngioDynamics' performance over
different periods. By using these non-GAAP measures, management believes that
investors get a better picture of the performance of AngioDynamics' underlying
business. Management encourages investors to review AngioDynamics' financial
results prepared in accordance with GAAP to understand AngioDynamics'
performance taking into account all relevant factors, including those that may
only occur from time to time but have a material impact on AngioDynamics'
financial results. Please see the tables that follow for a reconciliation of
non-GAAP measures to measures prepared in accordance with GAAP.

About AngioDynamics

AngioDynamics Inc. is a leading provider of innovative, minimally invasive
medical devices used by professional healthcare providers for vascular access,
surgery, peripheral vascular disease and oncology. AngioDynamics' diverse
product lines include market-leading ablation systems, fluid management
systems, vascular access products, angiographic products and accessories,
angioplasty products, drainage products, thrombolytic products and venous
products. More information is available at www.AngioDynamics.com.

Trademarks

AngioDynamics, the AngioDynamics logo, Acculis, AngioVac and BioFlo are
trademarks and/or registered trademarks of AngioDynamics Inc., an affiliate or
a subsidiary.

Safe Harbor

This release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. All statements regarding
AngioDynamics' expected future financial position, results of operations, cash
flows, business strategy, budgets, projected costs, capital expenditures,
products, competitive positions, growth opportunities, plans and objectives of
management for future operations, as well as statements that include the words
such as "expects," "reaffirms," "intends," "anticipates," "plans," "believes,"
"seeks," "estimates," "optimistic," or variations of such words and similar
expressions, are forward-looking statements. These forward looking statements
are not guarantees of future performance and are subject to risks and
uncertainties. Investors are cautioned that actual events or results may
differ from AngioDynamics' expectations. Factors that may affect the actual
results achieved by AngioDynamics include, without limitation, the ability of
AngioDynamics to develop its existing and new products, technological advances
and patents attained by competitors, future actions by the FDA or other
regulatory agencies, domestic and foreign health care reforms and government
regulations, results of pending or future clinical trials, overall economic
conditions, the results of on-going litigation, the effects of economic,
credit and capital market conditions, general market conditions, market
acceptance, foreign currency exchange rate fluctuations, the effects on
pricing from group purchasing organizations and competition, the ability of
AngioDynamics to integrate purchased businesses, including Navilyst Medical
and its products, R&D capabilities, infrastructure and employees as well as
the risk factors listed from time to time in AngioDynamics' SEC filings,
including but not limited to its Annual Report on Form 10-K for the year ended
May 31, 2013. AngioDynamics does not assume any obligation to publicly update
or revise any forward-looking statements for any reason.

ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(in thousands, except per share data)
                                                               
                                     Three months ended Six months ended
                                     Nov 30,   Nov 30,  Nov 30,   Nov 30,
                                     2013      2012     2013      2012
                                     (unaudited)        (unaudited)        
                                                               
Net sales                             $88,616  $87,007 $172,195 $170,423
Cost of sales                                                   
Acquired inventory step-up            75       --     75       3,445
Quality call to action                --      113     --      812
Other cost of sales                   43,611   42,806  84,708   82,620
Total cost of sales                  43,686   42,919  84,783   86,877
Gross profit                          44,930   44,088  87,412   83,546
% of net sales                        50.7%     50.7%    50.8%     49.0%
                                                               
Operating expenses                                              
Research and development             7,003    7,014   13,712   14,088
Sales and marketing                   21,073   18,671  41,036   37,214
General and administrative            6,323    6,910   12,851   13,808
Amortization of intangibles           4,339    4,107   8,623    7,844
Medical device tax                    999      --     1,975    --
Change in fair value of contingent    940      197     1,673    197
consideration
Acquisition and other non-recurring   2,679    2,067   4,681    4,589
Total operating expenses              43,356   38,966  84,551   77,740
Operatingincome (loss)               1,574    5,122   2,861    5,806
Other income (expense), net           (1,660)  (1,990) (3,594)  (3,828)
Income (loss) before income taxes     (86)     3,132   (733)    1,978
Provision for (benefit from) income   13       1,163   (208)    730
taxes
Net income (loss)                     $(99)   $1,969 $(525)  $1,248
                                                               
Earnings (loss) per common share                                
Basic                                 $(0.00) $0.06  $(0.01) $0.04
Diluted                               $(0.00) $0.06  $(0.01) $0.04
                                                               
Weighted average common shares                                  
Basic                                 35,132   34,827  35,041   34,765
Diluted                               35,132   35,311  35,041   35,279


ANGIODYNAMICS, INC. AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION
(in thousands, except per share data)
                                                              
Reconciliation of Net Income to non-GAAP Adjusted Net Income:
                                                              
                          Three months ended        Six months ended
                          Nov 30,       Nov 30,     Nov 30,      Nov 30,
                          2013          2012        2013         2012
                          (unaudited)               (unaudited)
                                                              
Net income (loss)          $(99)       $1,969    $(525)     $1,248
                                                              
After tax:                                                     
Acquisition and other      1,746        1,332      3,032       2,922
non-recurring (1)
Quality Call to Action     --          72         --         516
Program (2)
Inventory step-up (3)      48           --        48          2,188
Contingent earn out        597          125        1,062       125
valuation (4)
Adjusted net income        2,291        3,498      3,617       6,998
Amortization of            2,755        2,608      5,476       4,981
intangibles
Adjusted net income        $5,046      $6,106    $9,093     $11,979
excluding amortization
                                                              
Reconciliation of Diluted Earnings Per Share to non-GAAP Adjusted Diluted
Earnings Per Share:
                                                              
                          Three months ended        Six months ended
                          Nov 30,       Nov 30,     Nov 30,      Nov 30,
                          2013          2012        2013         2012
                          (unaudited)               (unaudited)
                                                              
Diluted earnings (loss)    $(0.00)     $0.06     $(0.01)    $0.04
per share
                                                              
After tax:                                                     
Acquisition and other      0.05         0.04       0.09        0.08
non-recurring (1)
Quality Call to Action     0.00         0.00       0.00        0.01
Program (2)
Inventory step-up (3)      0.00         0.00       0.00        0.06
Contingent earn out        0.02         0.00       0.03        0.00
valuation (4)
Adjusted diluted earnings  0.06         0.10       0.10        0.20
per share
Amortization of            0.08         0.07       0.16        0.14
intangibles
Adjusted diluted earnings
per share excluding        $0.14       $0.17     $0.26      $0.34
amortization
                                                              
* Does not sum due to                                          
rounding
                                                              
(1) Includes costs relating to acquisitions, debt financing, business
restructuring, litigation and facility consolidations.
(2) Direct costs of implementing a comprehensive Quality Call to Action
program to review and augment the quality management systems at our Queensbury
and Fremont facilities.
(3) Amortization of basis step-up of acquired inventory.
(4) Impact of revaluation of contingent earn outs related to acquisitions.


ANGIODYNAMICS, INC. AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION (Continued)
(in thousands, except per share data)
                                                              
Reconciliation of Net Income to EBITDA and Adjusted EBITDA:
                                                              
                         Three months ended         Six months ended
                         Nov 30,       Nov 30,      Nov 30,      Nov 30,
                         2013          2012         2013         2012
                         (unaudited)                (unaudited)
                                                              
Net income (loss)         $(99)       $1,969     $(525)     $1,248
                                                              
Provision for (benefit    13           1,163       (208)       730
from) income taxes
Other income (expense),   1,660        1,990       3,594       3,828
net
Amortization of           4,339        4,107       8,623       7,844
intangibles
Depreciation              1,849        2,185       3,662       4,317
EBITDA                    7,762        11,414      15,146      17,967
                                                              
Acquisition and other     2,679        2,067       4,681       4,589
non-recurring (1)
Stock-based compensation  1,271        1,252       2,423       2,375
Quality Call to Action    --          113         --         812
Program (2)
Inventory step-up (3)     75           --         75          3,445
Contingent earn out       940          197         1,673       197
revaluation (4)
Adjusted EBITDA           $12,727     $15,043    $23,998    $29,385
                                                              
EBITDA per common share                                        
Basic                     $0.22       $0.33      $0.43       $0.52
Assumes Diluted           $0.22       $0.32      $0.43       $0.51
                                                              
Adjusted EBITDA per                                            
common share
Basic                     $0.36        $0.43       $0.68       $0.85
Assumes Diluted           $0.36        $0.43       $0.68       $0.83
                                                              
Reconciliation of Operating Income to non-GAAP Adjusted Operating Income:
                                                              
                         Three months ended         Six months ended
                         Nov 30,       Nov 30,      Nov 30,      Nov 30,
                         2013          2012         2013         2012
                         (unaudited)                (unaudited)
                                                              
Operating income (loss)   $1,574       $5,122      $2,861      $5,806
                                                              
Acquisition and other     2,679        2,067       4,681       4,589
non-recurring (1)
Quality Call to Action    --          113         --         812
Program (2)
Inventory step-up (3)     75           --         75          3,445
Contingent earn out       940          197         1,673       197
revaluation (4)
Adjusted Operating income $5,268      $7,499     $9,290     $14,849
                                                              
(1) Includes costs relating to acquisitions, debt financing, business
restructuring, litigation and facility consolidations.
(2) Direct costs of implementing a comprehensive Quality Call to Action
program to review and augment the quality management systems at our Queensbury
and Fremont facilities.
(3) Amortization of basis step-up of acquired inventory.
(4) Impact of revaluation of contingent earn outs related to acquisitions.


ANGIODYNAMICS, INC. AND SUBSIDIARIES
PRELIMINARY NET SALES BY PRODUCT CATEGORY AND BY GEOGRAPHY
(unaudited in thousands)
                                                                  
                     Three months ended (a)      Six months ended (b)
                     Nov 30,   Nov 30,   %       Nov 30,    Nov 30,    %
                     2013      2012      Growth  2013       2012       Growth
                                                                  
Net Sales by Product                                               
Category
Peripheral Vascular   $48,860  $45,766  7%      $94,340   $89,060   6%
Vascular Access       25,571   26,712   (4%)    50,854    53,342    (5%)
Oncology/Surgery      12,557   12,006   5%      23,724    23,239    2%
Total Excluding       86,988   84,484   3%      168,918   165,641   2%
Supply Agreement
Supply Agreement      1,628    2,523    (35%)   3,277     4,782     (31%)
Total                 $88,616  $87,007  2%      $172,195  $170,423  1%
                                                                  
Net Sales by                                                       
Geography
United States         $69,530  $67,394  3%      $136,632  $132,898  3%
International         17,458   17,355   1%      32,286    32,743    (1%)
Supply Agreement      1,628    2,258    (28%)   3,277     4,782     (31%)
Total                 $88,616  $87,007  2%      $172,195  $170,423  1%
                                                                  
(a) Sales days for the three months ended Nov 30, 2013 and Nov 30, 2012, were
62 days.
(b) Sales days for the six months ended Nov 30, 2013 and Nov 30, 2012, were
126 and 127 days, respectively.


ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
                                                           
                                                Nov 30,     May 31,
                                                2013        2013
                                                (unaudited) (unaudited)
Assets                                                      
Current Assets                                              
Cash and cash equivalents                        $15,173    $21,802
Marketable securities                            1,850      2,153
Total cash and investments                       17,023     23,955
                                                           
Receivables, net                                 48,405     47,791
Inventories, net                                 60,052     55,062
Deferred income taxes                            6,706      6,591
Prepaid income taxes                             2,007      438
Prepaid expenses and other                       7,380      7,679
Total current assets                             141,573    141,516
                                                           
Property, plant and equipment, net               66,390     62,650
Intangible assets, net                           212,195    214,848
Goodwill                                         359,736    355,458
Deferred income taxes                            9,507      11,007
Other non-current assets                         6,089      6,105
Total Assets                                     $795,490   $791,584
                                                           
Liabilities and Stockholders' Equity                         
Current portion of long-term debt                $5,000     $7,500
Current portion of contingent consideration      12,221     9,207
Other current liabilities                        51,466     46,730
Total current liabilities                        68,687     63,437
Long-term debt, net of current portion           135,160    135,000
Contingent consideration, net of current portion 60,171     65,842
Other long-term liabilities                      1,743      475
Total Liabilities                                265,761    264,754
                                                           
Stockholders' equity                             529,729    526,830
Total Liabilities and Stockholders' Equity       $795,490   $791,584
                                                           
Shares outstanding                               35,305     35,060


ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
                                                               
                              Three months ended      Six months ended
                              Nov 30,     Nov 30,     Nov 30,     Nov 30,
                              2013        2012        2013        2012
                              (unaudited) (unaudited) (unaudited) (unaudited)
                                                               
Cash flows from operating                                       
activities:
Netincome(loss)             $(99)     $1,969    $(525)    $1,248
Depreciation and amortization 6,188      6,292      12,285     12,161
Change in fair value of        943        197        1,673      197
contingent consideration
Tax effect of exercise of      (85)       (504)      (146)      (504)
stock options
Deferred income taxes         688        2,260      1,226      2,175
Stock-based compensation      1,271      1,252      2,423      2,375
Amortization of inventory      75         --        75         3,445
step-up
Other                         19         (617)      (24)       (571)
Changes in operating assets                                     
and liabilities
Receivables                   (1,845)    (1,657)    209        1,497
Inventories                   (878)      1,084      (4,368)    (9,946)
Accounts payable and accrued   1,863      (46)       3,288      (6,861)
liabilities
Other                         46         900        (358)      299
Net cash provided by (used in) 8,186      11,130     15,758     5,515
operating activities
                                                               
Cash flows from investing                                       
activities:
Additions to property, plant   (4,017)    (3,819)    (7,191)    (4,787)
and equipment
Acquisition of businesses, net (150)      (15,166)   (4,319)    (14,308)
of cash acquired
Other cash flows from          --        801        --        801
investing activities
Purchases, sales and
maturities of marketable       --        9,452      303        11,855
securities, net
Net cash provided by (used in) (4,167)    (8,732)    (11,207)   (6,439)
investing activities
                                                               
Cash flows from financing                                       
activities:
Repayment of long-term debt   (143,750)  (1,875)    (143,750)  (3,750)
Proceeds from issuance of new  141,410    --        141,410    --
debt
Payment of Contingent          (8,350)    --        (9,300)    --
Consideration
Deferred financing costs of    (677)      --        (677)      --
long-term debt
Proceeds from exercise of      456        (103)      1,133      476
stock options and ESPP
Net cash provided by (used in) (10,911)   (1,978)    (11,184)   (3,274)
financing activities
                                                               
Effect of exchange rate        1          6          4          12
changes on cash
Increase(Decrease) in cash    (6,891)    426        (6,629)    (4,186)
and cash equivalents
                                                               
Cash and cash equivalents                                       
Beginning of period           22,064     18,896     21,802     23,508
End of period                 $15,173    $19,322    $15,173    $19,322

CONTACT: Company Contact:
         AngioDynamics Inc.
         Mark Frost, CFO
         (800) 772-6446 x1981
         mfrost@AngioDynamics.com
        
         Investor Relations Contacts:
         EVC Group, Inc.
         Michael Polyviou/Robert Jones
         (212) 850-6020; (646) 201-5447
         mpolyviou@evcgroup.com;
         bjones@evcgroup.com
        
         Media Contact:
         EVC Group, Inc.
         John Carter
         (212) 850-6021
         jcarter@evcgroup.com