Welcome!

IoT User Interface Authors: Peter Galvin, Elizabeth White, Dana Gardner, Nicole Bryan, Kevin Benedict

News Feed Item

IntriCon 2012 Fourth-Quarter Sales Rise 15.1 Percent

IntriCon Corporation (NASDAQ: IIN), a designer, developer, manufacturer and distributor of miniature and micro-miniature body-worn devices, today announced financial results for its fourth quarter and year ended December 31, 2012.

For the 2012 fourth quarter, the company reported net sales of $16.7 million, an increase of 15.1 percent from the prior-year period. IntriCon had net income of $332,000, or $0.06 per diluted share, compared to a net loss of $(352,000), or $(0.06) per diluted share, for the 2011 fourth quarter.

“We are pleased to have delivered growth across all markets for both the quarter and year – in fact our body-worn device segment had a record year,” said Mark S. Gorder, president and chief executive officer of IntriCon.

“Our medical business posted its strongest revenue quarter ever, driven by increased activity from our largest customer, Medtronic, among others. In hearing health, our non-conventional personal sound amplifier products, drove modest quarterly growth despite continued softness in the conventional hearing health market. And in professional audio communications we delivered significant gains, with sales increasing 44 percent over the 2011 fourth quarter on strong demand for securities products domestically and headset products internationally.”

As a percentage of 2012 fourth-quarter sales, healthcare-related revenue (hearing health and medical combined) totaled 72.7 percent (32.8 percent hearing health and 39.9 percent medical), with professional audio communications at 27.3 percent. This compares to 2011 healthcare-related revenue of 78.2 percent (37.4 percent hearing health and 40.8 percent medical), with professional audio communications at 21.8 percent.

Gross profit margins increased to 23.5 percent from 23.1 percent in the prior-year fourth quarter. The gain was primarily due to higher sales volume, partially offset by an unfavorable product mix within the professional audio communications market.

Said Gorder, “As part of our margin enhancement program, we continued to transfer select, labor-intensive programs to our Singapore and Indonesia facilities during the fourth quarter. In an effort to drive further margin improvement and remain competitive from a cost standpoint, we will continue that shift in 2013. We’re also working to increase the percentage of proprietary IntriCon technology in all of our products by investing in our core technologies—this also will have a favorable effect on margins as we move through the 2013 year.”

IntriCon reduced its operating expenses in the fourth quarter 2.8 percent, despite higher sales, reflecting the company’s ongoing focus on expense management.

Full-Year Results
For the 2012 year, IntriCon reported net sales of $63.9 million and net income of $709,000, or $0.12 per diluted share. This is up from 2011 net sales of $56.1 million and a net loss of $(1.4 million), or $(0.25) per diluted share. Hearing health sales rose 13.2 percent over the prior year, with medical and professional audio up 6.7 percent and 29.4 percent, respectively. Included in 2012 full-year results was a one-time gain of $822,000, or $0.14 per diluted share, from the previously disclosed sale of the company’s 50-percent ownership interest in Global Coils, to its Switzerland-based joint venture partner, Audemars SA.

As a percentage of 2012 sales, healthcare-related revenue totaled 75.5 percent (37.2 percent hearing health and 38.3 percent medical), with professional audio communications at 24.5 percent. This compares to 2011 healthcare-related revenue of 78.4 percent (37.5 percent hearing health and 40.9 percent medical), with professional audio communications at 21.6 percent.

Gross profit margins for 2012 were 23.4 percent, up from 22.6 percent in the prior year, primarily due to volume increases, partially offset by an unfavorable product mix.

hi HealthInnovations
As previously disclosed, IntriCon satisfied hi HealthInnovations’ initial product ramp-up needs for hearing aids early in 2012. As a result, minimal new orders were received in the second half of 2012. The company remains optimistic about the long-term prospects of this program.

Said Gorder, “hi HealthInnovations continues to make progress building the infrastructure to provide high-quality, affordable hearing health care to a broad range of customers. During the year, UnitedHealthcare expanded its hi HealthInnovation' program to more than 26 million people enrolled in its employer-sponsored and individual health benefit plans. We expect that this will open up additional opportunities for IntriCon and that new orders will be received in the second half of 2013.”

Business Update
Within IntriCon’s medical business, year-over-year sales rose 12.6 percent in the fourth quarter. The growth, as previously stated, was primarily due to increased activity from various large medical customers, most notably Medtronic. Near term, the company expects medical sales going forward to continue to strengthen.

On the cardiac front, IntriCon continues to deliver demo units of its two FDA-approved wireless cardiac diagnostic monitoring (CDM) devices—Centauri™ and Sirona™— to targeted customers to compile feedback. Additionally, the company is expanding its CDM sales and marketing infrastructure, to further advance its cardiac program and elevate its devices with market-demanded features.

Said Gorder, “Our technology connects patients and caregivers in non-traditional ways. We help shift the point of care from traditional settings such as hospitals, to non-traditional settings like the home. We accomplish this with devices that are more advanced, smaller and lightweight. In 2013, we will focus more capital and resources in sales and marketing to expand our reach to other large medical device manufacturers and healthcare companies.”

Within hearing health, IntriCon continues to experience softness in the conventional market. Said Gorder, “The 13.2 percent growth we experienced during the year came primarily from our hi HealthInnovations work, and non-conventional personal sound amplifier products. And in 2013, while we don’t anticipate hi HealthInnovations to ramp until the second half of the year, there are several growth opportunities that give us optimism for the longer term to strengthen our position as a supplier to the value hearing health market.

“First, we continue to develop new technology to improve the user experience. Our Audion6™, a six-channel hearing aid amplifier, is a notable example. Audion6 is a feature-rich amplifier that fits a wide array of applications and has a complete set of proven adaptive features.

“Second, hearing health technology is evolving beyond traditional hearing aid applications. Devices can now wirelessly stream music, television, audio or a companion’s voice—making them significantly more versatile and effective than traditional hearing devices. In addition, this technology and functionality holds great potential in the non-conventional personal sound amplifier market.”

Fourth-quarter professional audio communications sales remained very strong, up more than 44 percent from the prior-year period. The company completed delivery on its significant contract with the Singapore government during the quarter, providing technically advanced headsets to be worn in difficult listening environments. Professional audio sales going forward are expected to moderate to more historical levels.

Heightened Focus on Marketing
Said Gorder, “Over the past five years we have invested heavily in our technology portfolio and global manufacturing infrastructure. Better understanding customer and market needs, and evolving our technology portfolio to meet those needs, as well as developing new products and product platforms, is the next step in our strategic plan.

“To that end, we will be increasing investments in marketing and sales in 2013 to advance us down that path. That process has already begun and we expect to add additional staff and resources throughout the year to build customer relationships, market knowledge and sales.”

Looking Ahead
Concluded Gorder, “As a business, our primary goals are to build revenue, improve margins and grow our bottom line. We plan to do so by: placing a heightened focus on marketing; raising the percentage of proprietary IntriCon technology we incorporate in our products; and leveraging our low-cost manufacturing footprint.

“Consistent with historical revenue cycles we anticipate a more moderate 2013 first quarter in comparison to our 2012 fourth quarter. That being said, we are optimistic about our opportunities in 2013 and our ability to execute and deliver growth.”

Conference Call Today
As previously announced, the company will hold an investment community conference call today, Wednesday, February 13, 2013, beginning at 4:00 p.m. CT. Mark Gorder, president and chief executive officer, and Scott Longval, chief financial officer, will review fourth-quarter performance and discuss the company’s strategies. To join the conference call, dial: 1-877-941-6009 (international 1-480-629-9818) and provide the conference identification number 4596685 to the operator.

A replay of the conference call will be available one hour after the call ends through 11:59 p.m. CT on Tuesday, February 19, 2013. To access the replay, dial 1-800-406-7325 (international 1-303-590-3030) and enter access code: 4596685.

About IntriCon Corporation
Headquartered in Arden Hills, Minn., IntriCon Corporation designs, develops and manufactures miniature and micro-miniature body-worn devices. These advanced products help medical, healthcare and professional communications companies meet the rising demand for smaller, more intelligent and better connected devices. IntriCon has facilities in the United States, Asia and Europe. The company’s common stock trades under the symbol “IIN” on the NASDAQ Global Market. For more information about IntriCon, visit www.intricon.com.

Forward-Looking Statements
Statements made in this release and in IntriCon’s other public filings and releases that are not historical facts or that include forward-looking terminology are “forward-looking statements” within the meaning of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be affected by known and unknown risks, uncertainties and other factors that are beyond IntriCon’s control, and may cause IntriCon’s actual results, performance or achievements to differ materially from the results, performance and achievements expressed or implied in the forward-looking statements. These risks, uncertainties and other factors are detailed from time to time in the company’s filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the year ended December 31, 2011. The company disclaims any intent or obligation to publicly update or revise any forward-looking statements, regardless of whether new information becomes available, future developments occur or otherwise.

 
 
IntriCon Corporation
Consolidated Condensed Statements of Operations
(in thousands, except per share data)
 
    (Unaudited)
Three Months Ended     Twelve Months Ended
December 31,     December 31, December 31,     December 31,
2012 2011 2012 2011
Sales, net $ 16,665 $ 14,474 $ 63,933 $ 56,058
Cost of sales   12,748     11,131     48,957     43,392  
Gross profit 3,917 3,343 14,976 12,666
 
Operating expenses:
Sales and marketing 961 763 3,324 3,185
General and administrative 1,215 1,415 5,958 5,797
Research and development   1,181     1,276     4,694     4,876  
Total operating expenses   3,357     3,454     13,976     13,858  
Operating income (loss) 560 (111 ) 1,000 (1,192 )
 
Interest expense (166 ) (178 ) (755 ) (609 )
Equity in income (loss) of partnerships (39 ) (143 ) (116 ) 174
Gain on sale of investment in partnership -- -- 822 --
Other income (expense), net   (14 )   10     (78 )   42  
Income (loss) from before income taxes 341 (422 ) 873 (1,585 )
 
Income tax expense (benefit)   9     (70 )   164     (160 )
 
Net income (loss) $ 332   $ (352 ) $ 709   $ (1,425 )
 
Net income (loss) per share:
Basic $ 0.06 $ (0.06 ) $ 0.13 $ (0.25 )
Diluted $ 0.06 $ (0.06 ) $ 0.12 $ (0.25 )
 
 
Average shares outstanding:
Basic 5,678 5,623 5,669 5,599
Diluted 5,819 5,623 5,888 5,599
 
 
IntriCon Corporation
Consolidated Condensed Balance Sheets
(in thousands, except per share data)
 
At December 31,     2012     2011
Current assets:
Cash $ 226 $ 119
Restricted cash 563 540
Accounts receivable, less allowance for doubtful accounts of $154 and $223 at December 31, 2012 and 2011, respectively 7,171 8,545
Inventories 11,117 11,720
Refundable income taxes -- 82
Other current assets   1,483     652  
Total current assets 20,560 21,658
 
Machinery and equipment 40,796 39,170
Less: Accumulated depreciation   34,012     32,164  
Net machinery and equipment 6,784 7,006
 
Goodwill 9,709 9,709
Investment in partnerships 773 1,283
Other assets, net   1,306     1,074  
Total assets $ 39,132   $ 40,730  
 
Current liabilities:
Checks written in excess of cash $ 637 $ 396
Current maturities of long-term debt 2,945 2,883
Accounts payable 4,045 6,298
Accrued salaries, wages and commissions 1,786 1,617
Deferred gain 110 110
Partnership payable -- 240
Income taxes payable 96 --
Other accrued liabilities   2,048     1,907  
Total current liabilities 11,667 13,451
 
Long-term debt, less current maturities 7,222 8,217
Other postretirement benefit obligations 590 685
Accrued pension liabilities 510 431
Deferred gain 275 385
Other long-term liabilities   146     115  
Total liabilities 20,410 23,284
Commitments and contingencies
 
Shareholders’ equity:
Common stock, $1.00 par value per share; 20,000 shares authorized; 5,687 and 5,646 shares issued and outstanding at December 31, 2012 and 2011, respectively.

5,687

5,646

Additional paid-in capital 15,797 15,259
Accumulated deficit (2,360 ) (3,069 )
Accumulated other comprehensive loss   (402 )   (390 )
Total shareholders' equity   18,722     17,446  
Total liabilities and shareholders’ equity $ 39,132   $ 40,730  

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@CloudExpo Stories
The cloud market growth today is largely in public clouds. While there is a lot of spend in IT departments in virtualization, these aren’t yet translating into a true “cloud” experience within the enterprise. What is stopping the growth of the “private cloud” market? In his general session at 18th Cloud Expo, Nara Rajagopalan, CEO of Accelerite, explored the challenges in deploying, managing, and getting adoption for a private cloud within an enterprise. What are the key differences between wh...
More and more companies are looking to microservices as an architectural pattern for breaking apart applications into more manageable pieces so that agile teams can deliver new features quicker and more effectively. What this pattern has done more than anything to date is spark organizational transformations, setting the foundation for future application development. In practice, however, there are a number of considerations to make that go beyond simply “build, ship, and run,” which changes ho...
It is one thing to build single industrial IoT applications, but what will it take to build the Smart Cities and truly society changing applications of the future? The technology won’t be the problem, it will be the number of parties that need to work together and be aligned in their motivation to succeed. In his Day 2 Keynote at @ThingsExpo, Henrik Kenani Dahlgren, Portfolio Marketing Manager at Ericsson, discussed how to plan to cooperate, partner, and form lasting all-star teams to change t...
Connected devices and the industrial internet are growing exponentially every year with Cisco expecting 50 billion devices to be in operation by 2020. In this period of growth, location-based insights are becoming invaluable to many businesses as they adopt new connected technologies. Knowing when and where these devices connect from is critical for a number of scenarios in supply chain management, disaster management, emergency response, M2M, location marketing and more. In his session at @Th...
You are moving to the Cloud. The question is not if, it’s when. Now that your competitors are in the cloud and lapping you, your “when” better hurry up and get here. But saying and doing are two different things. In his session at @DevOpsSummit at 18th Cloud Expo, Robert Reeves, CTO of Datical, explained how DevOps can be your onramp to the cloud. By adopting simple, platform independent DevOps strategies, you can accelerate your move to the cloud. Spoiler Alert: He also makes sure you don’t...
Your business relies on your applications and your employees to stay in business. Whether you develop apps or manage business critical apps that help fuel your business, what happens when users experience sluggish performance? You and all technical teams across the organization – application, network, operations, among others, as well as, those outside the organization, like ISPs and third-party providers – are called in to solve the problem.
The initial debate is over: Any enterprise with a serious commitment to IT is migrating to the cloud. But things are not so simple. There is a complex mix of on-premises, colocated, and public-cloud deployments. In this power panel at 18th Cloud Expo, moderated by Conference Chair Roger Strukhoff, Randy De Meno, Chief Technologist - Windows Products and Microsoft Partnerships at Commvault; Dave Landa, Chief Operating Officer at kintone; William Morrish, General Manager Product Sales at Interou...
SaaS companies can greatly expand revenue potential by pushing beyond their own borders. The challenge is how to do this without degrading service quality. In his session at 18th Cloud Expo, Adam Rogers, Managing Director at Anexia, discussed how IaaS providers with a global presence and both virtual and dedicated infrastructure can help companies expand their service footprint with low “go-to-market” costs.
What does it look like when you have access to cloud infrastructure and platform under the same roof? Let’s talk about the different layers of Technology as a Service: who cares, what runs where, and how does it all fit together. In his session at 18th Cloud Expo, Phil Jackson, Lead Technology Evangelist at SoftLayer, an IBM company, spoke about the picture being painted by IBM Cloud and how the tools being crafted can help fill the gaps in your IT infrastructure.
Machine Learning helps make complex systems more efficient. By applying advanced Machine Learning techniques such as Cognitive Fingerprinting, wind project operators can utilize these tools to learn from collected data, detect regular patterns, and optimize their own operations. In his session at 18th Cloud Expo, Stuart Gillen, Director of Business Development at SparkCognition, discussed how research has demonstrated the value of Machine Learning in delivering next generation analytics to imp...
SYS-CON Events announced today that ReadyTalk, a leading provider of online conferencing and webinar services, has been named Vendor Presentation Sponsor at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. ReadyTalk delivers audio and web conferencing services that inspire collaboration and enable the Future of Work for today’s increasingly digital and mobile workforce. By combining intuitive, innovative tec...
Amazon has gradually rolled out parts of its IoT offerings, but these are just the tip of the iceberg. In addition to optimizing their backend AWS offerings, Amazon is laying the ground work to be a major force in IoT - especially in the connected home and office. In his session at @ThingsExpo, Chris Kocher, founder and managing director of Grey Heron, explained how Amazon is extending its reach to become a major force in IoT by building on its dominant cloud IoT platform, its Dash Button strat...
Digital Initiatives create new ways of conducting business, which drive the need for increasingly advanced security and regulatory compliance challenges with exponentially more damaging consequences. In the BMC and Forbes Insights Survey in 2016, 97% of executives said they expect a rise in data breach attempts in the next 12 months. Sixty percent said operations and security teams have only a general understanding of each other’s requirements, resulting in a “SecOps gap” leaving organizations u...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life sett...
It's easy to assume that your app will run on a fast and reliable network. The reality for your app's users, though, is often a slow, unreliable network with spotty coverage. What happens when the network doesn't work, or when the device is in airplane mode? You get unhappy, frustrated users. An offline-first app is an app that works, without error, when there is no network connection. In his session at 18th Cloud Expo, Bradley Holt, a Developer Advocate with IBM Cloud Data Services, discussed...
19th Cloud Expo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy. Meanwhile, 94% of enterpri...
There are several IoTs: the Industrial Internet, Consumer Wearables, Wearables and Healthcare, Supply Chains, and the movement toward Smart Grids, Cities, Regions, and Nations. There are competing communications standards every step of the way, a bewildering array of sensors and devices, and an entire world of competing data analytics platforms. To some this appears to be chaos. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, Bradley Holt, Developer Advocate a...
SYS-CON Events announced today that Bsquare has been named “Silver Sponsor” of SYS-CON's @ThingsExpo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. For more than two decades, Bsquare has helped its customers extract business value from a broad array of physical assets by making them intelligent, connecting them, and using the data they generate to optimize business processes.
The pace of innovation, vendor lock-in, production sustainability, cost-effectiveness, and managing risk… In his session at 18th Cloud Expo, Dan Choquette, Founder of RackN, discussed how CIOs are challenged finding the balance of finding the right tools, technology and operational model that serves the business the best. He also discussed how clouds, open source software and infrastructure solutions have benefits but also drawbacks and how workload and operational portability between vendors ...
There is little doubt that Big Data solutions will have an increasing role in the Enterprise IT mainstream over time. Big Data at Cloud Expo - to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA - has announced its Call for Papers is open. Cloud computing is being adopted in one form or another by 94% of enterprises today. Tens of billions of new devices are being connected to The Internet of Things. And Big Data is driving this bus. An exponential increase is...