SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6 K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
EDAP TMS S.A. Files
Press release on second quarter 2007 results
August 30, 2007
EDAP TMS S.A.
Parc Activite La Poudrette Lamartine
4/6 Rue du Dauphine
69120 Vaulx-en-Velin - France
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.
Form 20-F |X| Form 40-F |_|
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes |_| No |X|
This report on Form 6-K with respect to the Company's 2006 annual results, is
hereby incorporated by reference in the registration statement of EDAP TMS S.A.
on Form F-3, file number 333-136811.
TO BUSINESS AND MEDICAL EDITORS:
EDAP TMS S.A. 2007 Second Quarter Revenues Increase
European Growth Continues, HIFU Division Returns to Profitability
Retains Experienced North American Prostate Cancer Leader to Drive USA
Programs
LYON, France, Aug. 30 /PRNewswire-FirstCall/ -- EDAP TMS S.A. (Nasdaq:
EDAP), the global leader in High Intensity Focused Ultrasound (HIFU) treatment
of prostate cancer and the international leader in the development, production,
and distribution of a wide portfolio of minimally invasive medical devices
primarily for the treatment of urological diseases today reported financial
results for the second quarter 2007 and updated its HIFU growth expectations.
Key highlights include:
* HIFU RPP Revenues increased 40% year over year on significant
treatment growth and response to the company's marketing
initiatives. Year to date 23 new centers, including 12 in the second
quarter, have launched bringing the total global base to 155 sites
with additional sites signing on monthly.
* Total revenues are the highest reported in recent quarters due to
the mix of equipment sales coupled with high revenue contribution
from the recurring RPP programs at a growing number of sites. At
June 30 the company reported cash of Euro 9.0 million, having used
only Euro 325,000 in the second quarter as a result of increased
device sales and RPP levels compared to the prior year.
* The HIFU division grew revenues 45% as compared with 2006 same
quarter revenues. In the second quarter and first six months of 2007
the HIFU division reported an operating profit of Euro 354,000 and
Euro 20,000 respectively due to shifts in revenue mix and strong
margins.
* The company continued its progress on the US trials by adding Dr.
John Rewcastle as its Group Medical Director, a well known and
highly regarded prostate cancer expert. Rewcastle's main mission and
target will be to lead EDAP's FDA approval process, which is a major
and positive step forward for the company in the US.
* Clinical activity continues to grow including recent successes
reported in studies designed to demonstrate the effectiveness of
Ablatherm-HIFU in additional cancer stages through the use of
combination therapy, a common practice in later stage cancers. Early
indications suggest Ablatherm is particularly well suited for
combination with hormonal therapy in later stage cancers such as T2c
where the device has not previously seen regular use.
EXECUTIVE COMMENTS
Marc Oczachowski, EDAP TMS Chief Executive Officer commented: "The second
quarter is a record among recent quarters with revenue of nearly 6 million
Euros. EDAP continues its high growth in RPP revenues with a 40% increase on the
first half of Fiscal 2007 compared with last year. Already July and August,
typically slow summer months due to holidays prevalent in Europe look promising
with a comparable high growth rate. We are preparing for more growth in our RPP
programs based on refinement of the marketing and sales efforts launched to
achieve this success. We are adjusting our communications with direct feedback
from our subsidiaries and their local customers, including passing further
control over marketing plans and budgets to each major country manager in Europe
rather than centralizing these decisions from headquarters. These regional
actions will bring even higher efficacy and response to our conversion plans for
both patients and urologists for Ablatherm-HIFU.
"We are also pleased to already see significant benefit from the addition
of John Rewcastle to lead our medical efforts, including management of the FDA
programs. Dr. Rewcastle is the leading authority comparing devices available on
HIFU for prostate cancer. His decision to join EDAP affirms what our science has
shown conclusively -- EDAP secures consistent, statistically predictive efficacy
outcomes for patients while delivering some of the lowest complication rates in
areas crucial for quality of life, especially in the area of incontinence and
also in impotence through the opportunity to preserve the erectile nerves. As
men are diagnosed earlier in life, the importance of Ablatherm's ability to
protect a man's quality of life will only increase.
"The revenue growth and decreased loss in the second quarter results
confirm again the validity of our high growth RPP program. EDAP's revenues are
still significantly, and this quarter positively, affected by the Ablatherm
device sales despite the growth already achieved in our recurring revenues. We
know as a matter of fact that HIFU machine sales are unpredictable from one
quarter to the other. This dependence will decrease as EDAP increases revenues
in RPP lines among the total group revenues, an effort already achieving much
success."
FINANCIAL RESULTS
EDAP's second quarter and first half results show significant growth from
the higher contribution of the company's RPP business lines and the effect of
revenue diversification. Second quarter revenues increased 28% compared to first
quarter revenue due to the sale of two Ablatherm units in the second quarter.
Continued growth in recurring RPP and services revenues will ultimately reduce
the swing effect of device sales.
Gross profit at the group level in the first six months is Euro 4.3
million reflecting gross margins of 41.1%, down slightly from the prior year due
to changes in UDS sales mix and currency while HIFU margins remain steady at 60%
for the first half. Second quarter HIFU margins were 61 percent, up 4% compared
to the prior year period.
Group operating loss was Euro 712,000 in the second quarter and Euro 1.9
million year to date. Operating loss includes FDA trial expenses and higher
costs for the expanded marketing and sales support fueling HIFU revenue growth.
The company recorded $300,000 in benefit from the exercise of warrants by its
former partner in the US as well as increased cash investment in inventory
assets ahead of second half sales and the launch of the company's new Sonolith
I-sys requiring inventory investment for the near term. Cash position remains
strong at Euro 9.0 million, or $12.1 million US, at June 30.
The HIFU revenue reached Euro 4.4 million at the end of June 2007, Euro
2.8 million in the second quarter alone. This is an increase 45.4% over the
second quarter of 2006 and 74.7% over Q1 2007. The increase includes the sale of
two Ablatherm units with additional sales expected in the second half and the
steady growth of RPP sales, up 40.2% over the first six months of 2006.
The second quarter revenue increase helped the HIFU division past
breakeven at the end of June, with a Euro 354,000 Operating Profit in the
quarter and a Euro 20,000 profit in the first half, despite the increase in
marketing expenses by 19% over the first half 2006.
UDS revenue remains recurring and globally stable at Euro 3.1 million in
the second quarter, up 2.4% and 27.5% over Q1 2007 and Q4 2006 respectively, and
down 5.2% for the first half of 2007 as compared to 2006, with a six month
revenue of Euro 6.2 million. The decrease of Euro 300,000 in the six months is
primarily connected to negative exchange rate impacts of Euro 200,000 on the
Japanese Yen, and to a lower number of machines sold (18 lithotripters in 2007
versus 21 in 2006), partially offset by a 9% increase in the average price due
to product and country mix.
UDS Gross Margin decreased by 6.5 points to 27.5% year to date in 2007.
The decrease is due to the exchange rate effect on machines sold in Japan to
date and mix as a higher portion of products were sold including optional
equipment. Options increase revenue, but are purchased from third parties
decreasing the global margin rate. The already identified appetite for
full-option high-range litho machines drove the development of the new Sonolith
I-sys litho machine to be launched in Autumn this year, to help sustain and grow
the UDS revenue.
Eric Soyer, EDAP TMS Chief Financial Officer, commented: "As we had
indicated, the first quarter had a high cash investment due to increases in
inventory to prepare for equipment sales such as shown in the second quarter.
More importantly, the recent results demonstrate the success of the business
model in balancing recurring revenue sources with less predictable equipment
sales. We intend to continue growing the recurring RPP and services portion of
our business to ultimately secure profitable operations. EDAP's strong cash
management allows it the flexibility to address needs on two continents from a
position of strength, making investments that will secure long term future
growth and profitability for shareholders."
US PROGRAMS: REWCASTLE BRINGS FDA EXPERTISE, NORTH AMERICAN PRESENCE
EDAP continues its ongoing US clinical sessions in pursuit of future FDA
approval for Ablatherm-HIFU under its direct efforts. EDAP has full rights to
all revenue and profit earned in future US activities with growing treatment
demand from centers participating in the EDAP study. Both patients and doctors
report early success with the Ablatherm-HIFU activities mirroring the highly
predictive outcomes observed over more than a decade of European clinical
examination. Dr. Rewcastle will lead the trial programs in the United States
including center selection, medical communications, FDA activities and education
efforts to make doctors aware of the study and HIFU's existing medical
documentation to help them evaluate appropriate patient selection criteria for
Ablatherm-HIFU under the study protocols.
Dr. Rewcastle commented: "Although I expected to see the trial embraced,
the level of interest within the urological community has been surprising. There
are many more centers interested in participating in the clinical trial that we
can accommodate -- both top level academic centers and high quality community
practices. Thankfully, this is a very good problem to have in terms of accruing
patients to a clinical trial. For physicians and patients alike, I believe HIFU
will ultimately become the treatment of choice for men diagnosed with low risk
prostate cancer within the next decade. HIFU is attractive to patients due to
the non-invasive nature of the procedure and its low complication rate. More
importantly, however, is the emerging clinical data that is establishing the
durability of the treatment and solidifying HIFU's role as a primary prostate
cancer therapy."
Conference Call and Webcast
Management will host a conference call today, August 30, at noon Eastern
Time, 6:00 p.m. Paris Time. Interested investors may join the call live by
dialing (866) 463-5401 from the United States or +1 (212) 457-9857 from
international locations and entering PIN code 762482#. Investors may also listen
to the live call online at http://www.edap-tms.com.
Investors unable to join the call can access a playback of the conference
call by telephone or online. To access the replay, please dial (866) 439-4554 or
+1 (212) 457-9844 and using access code 334818# beginning one hour after the end
of the call until September 30, 2007, or visit the company's Web site at
http://www.edap-tms.com.
About EDAP TMS S.A.
EDAP TMS S.A. develops and markets Ablatherm, the most advanced and
clinically proven choice for High Intensity Focused Ultrasound (HIFU) treatment
of localized prostate cancer. HIFU treatment is shown to be a minimally invasive
and effective treatment option with a low occurrence of side effects.
Ablatherm-HIFU is generally recommended for patients with localized prostate
cancer (stages T1-T2) who are not candidates for surgery or who prefer an
alternative option, or for patients who failed radiotherapy treatment. The
company is also developing this technology for the potential treatment of
certain other types of tumors. EDAP TMS S.A. also produces and commercializes
medical equipment for treatment of urinary tract stones using Extra-corporeal
Shockwave Lithotripsy (ESWL).
For more information on the Company, contact Magnolia Investor Relations
at (469) 362-5960, the Corporate Investor Relations Dept at +33 (0)4 78 26 40 46
or see the Company's Web sites at http://www.edap-tms.com and
http://www.hifu-planet.com.
To sign up for alerts please visit:
http://www.b2i.us/irpass.asp?BzID=1053&to=ea&s=0
In addition to historical information, this press release contains
forward-looking statements that involve risks and uncertainties. These include
statements regarding the Company's growth and expansion plans. Such statements
are based on management's current expectations and are subject to a number of
uncertainties and risks that could cause actual results to differ materially
from those described in these forward-looking statements. Factors that may cause
such a difference include, but are not limited to, those described in the
Company's filings with the Securities and Exchange Commission. Ablatherm- HIFU
treatment is in clinical trials but not yet FDA approved or marketed in the
United States.
CONTACT: EDAP TMS S.A. Magnolia Investor Relations
Blandine Confort Matt Kreps
+33 4 78 26 40 46 469 362 5960
EDAP TMS S.A.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Amounts in thousands of Euros and U.S. Dollars, except per share data)
Three Months Ended : Three Months Ended :
June 30, June 30, June 30, June 30,
2007 2006 2007 2006
Euros Euros $US $US
Sales of goods 3,261 2,653 4,417 3,382
Net Sales of RPP
and Leases 1,262 1,009 1,710 1,286
Sales of spare parts
and Services 1,410 1,441 1,910 1,837
TOTAL NET SALES 5,933 5,104 8,036 6,505
Other revenues 14 64 19 82
TOTAL REVENUES 5,947 5,168 8,055 6,586
Cost of goods (2,085) (1,650) (2,824) (2,103)
Cost of RPP and Leases (549) (415) (744) (529)
Cost of spare parts
& services (967) (891) (1,309) (1,135)
Cost of sales (3,601) (2,956) (4,877) (3,767)
GROSS PROFIT 2,346 2,212 3,178 2,819
Research & development
expenses (943) (628) (1,277) (801)
Marketing & Sales
expenses (1,322) (1,482) (1,790) (1,888)
G & A expenses (1,235) (895) (1,673) (1,139)
Non recurring profit/
(expenses) 441 598
Total operating
expenses (3,059) (3,004) (4,142) (3,829)
OPERATING PROFIT
(LOSS) (712) (792) (965) (1,009)
Interest (expense)
income, net 3 21 4 27
Currency exchange gains
(loss), net (180) (103) (244) (131)
Other income (loss), net 9 4 12 5
INCOME (LOSS) BEFORE
TAXES AND MINORITY
INTEREST (880) (870) (1,192) (1,109)
Income tax (expense)
credit 144 21 195 26
NET INCOME (LOSS) (736) (850) (997) (1,083)
Earning per share
- Basic (0.08) (0.11) (0.11) (0.14)
Average number of
shares used
in computation of
basic EPS 9,163,007 7,837,831 9,163,007 7,837,831
Earning per share
- Diluted (0.08) (0.11) (0.11) (0.14)
Average number of
shares used
in computation of
diluted EPS 9,543,569 8,576,387 9,543,569 8,576,387
NOTE: Translated for convenience of the reader to U.S. dollars at the 2007
average three months noon buying rate of 1 Euro = 1.3544 USD, and 2006 average
three months noon buying rate of 1 Euro = 1.2745 USD.
EDAP TMS S.A.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(Amounts in thousands of Euros and U.S. Dollars, except per share data)
Six Months Ended : Six Months Ended :
June 30, June 30, June 30, June 30,
2007 2006 2007 2006
Euros Euros $US $US
Sales of goods 5,163 5,442 6,900 6,754
Net Sales of RPP
and Leases 2,571 1,980 3,436 2,458
Sales of spare parts
and Services 2,830 2,865 3,782 3,556
TOTAL NET SALES 10,564 10,288 14,118 12,767
Other revenues 49 79 66 98
TOTAL REVENUES 10,613 10,367 14,184 12,865
Cost of goods (3,358) (3,317) (4,488) (4,116)
Cost of RPP and Leases (1,117) (846) (1,493) (1,050)
Cost of spare parts
& services (1,797) (1,706) (2,402) (2,117)
Cost of sales (6,276) (5,869) (8,384) (7,283)
GROSS PROFIT 4,340 4,498 5,800 5,582
Research & development
expenses (1,559) (1,223) (2,084) (1,518)
Marketing & Sales
expenses (2,663) (2,572) (3,559) (3,192)
G & A expenses (2,418) (1,978) (3,232) (2,456)
Non recurring profit/
(expenses) 441 590
Total operating
expenses (6,199) (5,574) (8,285) (7,165)
OPERATING PROFIT
(LOSS) (1,859) (1,275) (2,484) (1,583)
Interest (expense)
income, net 6 35 9 43
Currency exchange
gains (loss), net (228) (176) (305) (219)
Other income (loss), net 12 1 16 1
INCOME (LOSS) BEFORE
TAXES AND MINORITY
INTEREST (2,069) (1,417) (2,765) (1,758)
Income tax (expense)
credit 124 (57) 165 (70)
NET INCOME (LOSS) (1,945) (1,473) (2,600) (1,828)
Earning per share
- Basic (0.21) (0.19) (0.28) (0.23)
Average number of
shares used
in computation of
basic EPS 9,163,007 7,837,831 9,163,007 7,837,831
Earning per share
- Diluted (0.21) (0.19) (0.28) (0.23)
Average number of
shares used
in computation
of diluted EPS 9,685,022 8,599,346 9,685,022 8,599,346
NOTE: Translated for convenience of the reader to U.S. dollars at the 2007
average three months noon buying rate of 1 Euro = 1.3365 USD, and 2006 average
three months noon buying rate of 1 Euro = 1.2410 USD.
EDAP TMS S.A.
CONSOLIDATED BALANCE SHEETS HIGHLIGHTS (UNAUDITED)
(Amounts in thousands of Euros and U.S. Dollars)
June 30, Mar. 31, June 30, Mar. 31,
2007 2007 2007 2007
Euros Euros $US $US
Cash, cash equivalents
and short term
investments 8,966 9,291 12,122 12,426
Total current assets 25,346 25,699 34,268 34,370
Total current
liabilities 11,677 11,368 15,788 15,204
Shareholders' Equity 17,761 18,247 24,013 24,404
NOTE: Translated for convenience of the reader to U.S. dollars at the noon
buying rate of 1 Euro = 1.352 USD on June 30, 2007 and at the noon buying rate
of 1 Euro = 1.3374 USD, on March 31, 2007.
EDAP TMS S.A.
CONDENSED STATEMENTS OF OPERATIONS BY DIVISION
SIX MONTHS ENDED JUNE 30, 2007
(Amounts in thousands of Euros)
EDAP S.A. TMS S.A. EDAP EDAP Total
HIFU UDS TMS TMS After
Division Division FDA Corporate Consolidation
Sales of
goods 1,545 3,618 5,163
Sales of
RPPs &
Leases 2,085 486 2,571
Sales of
spare parts
& services 792 2,039 2,830
TOTAL NET
SALES 4,422 6,142 10,564
Other
revenues 18 32 49
TOTAL REVENUES 4,439 6,174 10,613
GROSS PROFIT 2,648 60% 1,692 28% 4,340 41%
Research &
Development (698) (549) (311) (1,559)
Total SG&A
plus
depreciation (1,930) (1,852) (315) (984) (5,081)
Non recurring
profit/
(expenses) 137 304 441
OPERATING PROFIT
(LOSS) 20 (572) (322) (984) (1,859)
SOURCE EDAP TMS S.A.
-0- 08/30/2007
/CONTACT: Blandine Confort of EDAP TMS S.A., +33 4 78 26 40 46; or Matt
Kreps of Magnolia Investor Relations, +1-469-362-5960/
/First Call Analyst: /
/FCMN Contact: /
/Web site: http://www.edap-tms.com/
(EDAP)
CO: EDAP TMS S.A.
ST: France
IN: MTC HEA
SU: ERN CCA
ND-EW
- -- LATH040 --
4841 08/29/2007 23:52 EDT
DEFERRED FOR 07:30 08/30
SIGNATURES
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, thereunto duly authorized.
Date : August 30, 2007
EDAP TMS S.A.
S/ MARC OCZACHOWSKI
MARC OCZACHOWSKI
CHIEF EXECUTIVE OFFICER