Welcome!

Microsoft Cloud Authors: John Basso, Liz McMillan, Pat Romanski, Glenn Rossman, Elizabeth White

News Feed Item

Align Technology Announces Fourth Quarter and Record Fiscal Year 2012 Results

SAN JOSE, CA -- (Marketwire) -- 01/30/13 -- Align Technology, Inc. (NASDAQ: ALGN)

  • 2012 net revenues were a record $560.0 million, an increase of 16.7% year-over-year
  • 2012 Invisalign clear aligner case shipments were a record 363.5 thousand, an increase 17.5% year-over-year
  • Q4 net revenues of $142.8 million include the release of $4.9 million of previously deferred revenue for Invisalign case refinement
  • Q4 Invisalign clear aligner revenue of $132.8 million increased 4.8% sequentially and 11.7% year-over-year
  • Q4 Invisalign clear aligner shipments were 90.5 thousand, compared to 92.5 thousand in Q3 12 and 82.6 thousand in Q4 11
  • Q4 diluted GAAP diluted EPS was $0.12, non-GAAP diluted EPS was $0.27

Align Technology, Inc. (NASDAQ: ALGN) today reported financial results for the fourth quarter and fiscal year ended December 31, 2012.

Total net revenues for the fourth quarter of fiscal 2012 (Q4 12) were $142.8 million. This is compared to $136.5 million reported in the third quarter of 2012 (Q3 12) and compared to $128.9 million reported in the fourth quarter of 2011 (Q4 11). Q4 12 net revenues include the release of $4.9 million of revenue previously deferred for Invisalign case refinement. Q4 12 Invisalign clear aligner revenue was $132.8 million, compared to $126.7 million in Q3 12 and $118.9 million in Q4 11. Q4 12 Invisalign clear aligner case shipments were 90.5 thousand, compared to 92.5 thousand in Q3 12 and 82.6 thousand in Q4 11. Q4 12 scanner and CAD/CAM services revenue was $10.0 million, compared to $9.8 million in Q3 12 and compared to $10.0 million in Q4 11.

Align defers revenue for Invisalign case refinement, which is an optional finishing tool used to adjust a patient's teeth to the desired final position that is generally ordered in the last stages of orthodontic treatment. In Q4 12, we determined that the actual usage rate was lower than our estimate and as a result we released $4.9 million of revenue deferred for case refinement.

For fiscal 2012 (FY 12), record net revenues of $560.0 million increased 16.7 percent from $479.7 million reported for fiscal 2011 (FY 11). Record FY 12 Invisalign clear aligner net revenues of $516.6 million increased 14.4% from $451.7 million reported for FY 11. FY 12 Invisalign clear aligner case shipments of 363.5 thousand increased 17.5% from 309.3 thousand reported for FY 11. FY 12 scanner and CAD/CAM services net revenues was $43.4 million compared to $28.0 million in FY 11. FY 11 scanner and CAD/CAM services net revenues reflect eight months of sales resulting from the acquisition of Cadent Holdings, Inc., which closed on April 29, 2011.

"I'm very pleased to report a solid fourth quarter which culminated in a record fiscal year for with over 17 percent growth for Invisalign volume", said Thomas M. Prescott, Align president and CEO. "Despite a soft start this quarter in North America for Align and most of the dental industry, Invisalign case submissions rebounded in December and this trend has continued into the first quarter of 2013. Overall, we've seen an uptick in North American case receipts -- reflecting increased patient traffic in our customers' offices, as well as traction from customer engagement and practice development activities. We've also seen increased customer interest in Invisalign related to the launch of SmartTrack, our next generation aligner material which is commercially available now." Prescott continued, "We had many significant accomplishments in 2012 that contributed to our growth, including entry into new market segments with the launch of Invisalign Express 5 and Invisalign i7 and expansion into new emerging country markets. We are starting off the new year with several new products and feature enhancements including the new iTero scanner, Invisalign Outcome Simulator, and Invisalign G4 enhancements which will contribute to our growth throughout the year."

Net profit for Q4 12 of $9.6 million, or $0.12 per diluted share, includes the release of $4.9 million of revenue previously deferred for Invisalign case refinement. This is compared to net loss of $0.3 million, or $0.00 per diluted share in Q3 12 and net profit of $20.4 million, or $0.25 per diluted share in Q4 11. Net profit for Q4 12 includes a goodwill impairment charge of $11.9 million resulting from finalizing our Q3 12 preliminary estimate and a pre-tax amortization of acquired intangible assets of $1.0 million with a total income tax-related adjustment of $0.2 million. Net loss for Q3 12 includes a preliminary estimate pre-tax goodwill impairment charge of $24.7 million, pre-tax acquisition and integration related costs of $0.2 million, pre-tax amortization of acquired intangible assets of $1.1 million, pre-tax severance and benefit costs of $0.1 million with a total income tax-related adjustment of $2.1 million. Net profit for Q4 11 includes pre-tax acquisition and integration related costs of $1.1 million, pre-tax amortization of acquired intangible assets of $1.3 million, pre-tax severance and benefit costs of $0.8 million with a total tax effect of $0.7 million.

In Q3 12, we determined that there were sufficient indicators of a potential impairment to the goodwill attributed to the scanner and CAD/CAM services reporting unit, therefore we conducted step one of the goodwill impairment analysis and concluded that the goodwill was impaired. Based on our preliminary step two analysis, we recorded an estimated goodwill impairment charge of $24.7 million in Q3 12. In Q4 12, we finalized step two of our analysis and recorded an additional goodwill impairment charge of $11.9 million.

Net profit for FY 12 was $58.7 million or $0.71 per diluted share and includes pre-tax goodwill impairment charge of $36.6 million, pre-tax acquisition and integration related costs of $1.3 million, pre-tax amortization of acquired intangible assets of $4.4 million, pre-tax severance and benefit costs of $0.8 million with a total tax effect of $4.9 million. This compares to net profit for FY 11 of $66.7 million, or $0.83 per diluted share and includes pre-tax acquisition and integration related costs of $10.0 million, pre-tax amortization of acquired intangible assets of $3.2 million, pre-tax severance and benefit costs of $1.1 million with a total tax effect of $2.9 million.

To supplement our consolidated financial statements, we use the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP operating expense, non-GAAP operating margin, non-GAAP net profit, non-GAAP earnings per diluted share, EBITDA and adjusted EBITDA. Detailed reconciliations between GAAP and non-GAAP information are contained in the tables following the financial tables of this release.

Non-GAAP net profit for Q4 12 was $22.3 million, or $0.27 per diluted share. This is compared to non-GAAP net profit of $23.7 million, or $0.28 per diluted share in Q3 12 and non-GAAP net profit of $23.0 million, or $0.28 per diluted share in Q4 11. Non-GAAP net profit for FY 12 was $96.7 million, or $1.17 per diluted share. This compares to non-GAAP net profit for FY 11 of $78.1 million, or $0.97 per diluted share.


Q4 12 Operating Results ($M)

  Key GAAP Operating Results                   Q4 12      Q3 12      Q4 11
                                            ---------  ---------  ---------
  Revenue                                   $   142.8  $   136.5  $   128.9
    Clear Aligner                           $   132.8  $   126.7  $   118.9
    Scanner and CAD/CAM Services            $    10.0  $     9.8  $    10.0

  Gross Margin                                   74.5%      73.5%      74.1%
    Clear Aligner                                78.8%      77.6%      78.7%
    Scanner and CAD/CAM Services                 18.5%      20.6%      20.0%

  Operating Expense                         $    89.4  $    95.8  $    69.1
  Operating Margin                               12.0%       3.3%      20.5%
  Net Profit (Loss)                         $     9.6  $    (0.3) $    20.4
  Earnings (Loss) Per Diluted Share (EPS)   $    0.12  $   (0.00) $    0.25

  Key Non-GAAP Operating Results               Q4 12      Q3 12      Q4 11
                                            ---------  ---------  ---------
  Non-GAAP Gross Margin                          74.7%      73.7%      74.9%
    Non-GAAP Clear Aligner                       78.8%      77.6%      78.7%
    Non-GAAP Scanner & CAD/CAM Services          20.5%      23.8%      30.0%

  Non-GAAP Operating Expense                $    76.6  $    70.0  $    66.9
  Non-GAAP Operating Margin                      21.0%      22.4%      23.0%
  Non-GAAP Net Profit                       $    22.3  $    23.7  $    23.0
  Non-GAAP Earnings Per Diluted Share (EPS) $    0.27  $    0.28  $    0.28
  EBITDA                                    $    21.7  $     8.5  $    30.7
  Adjusted EBITDA                           $    33.6  $    33.6  $    32.6

Total stock-based compensation expense included in Q4 12 was $6.0 million compared to $5.4 million in Q3 12 and $5.0 million in Q4 11. Stock based compensation expense included in GAAP gross margin in Q4 12, Q3 12 and Q4 11 was $0.5 million. Stock-based compensation expense included in GAAP operating expense in Q4 12 was $5.5 million compared to $4.9 million in Q3 12 and $4.5 million in Q4 11.

Liquidity and Capital Resources
As of December 31, 2012, Align Technology had $356.1 million in cash, cash equivalents, and marketable securities compared to $248.1 million as of December 31, 2011. During Q4 12, we purchased approximately 1.4 million shares of our common stock at an average price of $26.41 per share for a total of approximately $37.0 million. There remains approximately $95.5 million available under the Company's existing stock repurchase authorization.

Q1 Fiscal 2013 Business Outlook
For the first quarter of fiscal 2013 (Q1 13), Align Technology expects net revenues to be in a range of $146.0 million to $150.5 million. Invisalign clear aligner case shipments for Q1 13 are expected to be in a range of 95.0 to 97.5 thousand cases, which reflect a year-over-year increase of 11.4% to 14.3%. Earnings per diluted share for Q1 13 is expected to be in a range of $0.21 to $0.23. Starting in fiscal year 2013, amortization of acquired intangible assets will no longer be excluded as a non-GAAP measure. The expense is now included in all periods presented, therefore, excluding it as a non-GAAP measure is no longer meaningful in period-to-period comparisons. A more comprehensive business outlook is available following the financial tables of this release.

Align Web Cast and Conference Call
Align Technology will host a conference call today, January 30, 2013 at 4:30 p.m. ET, 1:30 p.m. PT, to review its fourth quarter and fiscal year 2012 results, discuss future operating trends and business outlook. The conference call will also be web cast live via the Internet. To access the web cast, go to the "Events & Presentations" section under Company Information on Align Technology's Investor Relations web site at http://investor.aligntech.com. To access the conference call, please dial 201-689-8261 approximately fifteen minutes prior to the start of the call. An archived audio web cast will be available beginning approximately one hour after the call's conclusion and will remain available for approximately 12 months. Additionally, a telephonic replay of the call can be accessed by dialing 877-660-6853 with conference number 406337 followed by #. For international callers, please dial 201-612-7415 and use the same conference number referenced above. The telephonic replay will be available through 5:30 p.m. ET on February 8, 2013.

About Align Technology, Inc.
Align Technology designs, manufactures and markets Invisalign, a proprietary method for treating malocclusion, or the misalignment of teeth. Invisalign corrects malocclusion using a series of clear, nearly invisible, removable appliances that gently move teeth to a desired final position. Because it does not rely on the use of metal or ceramic brackets and wires, Invisalign significantly reduces the aesthetic and other limitations associated with braces. Invisalign is appropriate for treating adults and teens. Align Technology was founded in March 1997 and received FDA clearance to market Invisalign in 1998.The Invisalign product family includes Invisalign, Invisalign Teen, Invisalign Assist, Invisalign Express 10, Invisalign Express 5, Invisalign Lite, and Vivera Retainers. To learn more about Invisalign or to find an Invisalign trained doctor in your area, please visit www.invisalign.com.

Cadent Holdings, Inc. is a subsidiary of Align Technology and is a leading provider of 3D digital scanning solutions for orthodontics and dentistry. The Cadent family of products includes iTero and iOC scanning systems, OrthoCAD iCast and OrthoCAD iRecord. For additional information, please visit www.cadentinc.com.

About non-GAAP Financial Measures
To supplement our consolidated financial statements and our business outlook, we use the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP operating expenses, non-GAAP profit from operations, non-GAAP net profit and non-GAAP earnings per share, which exclude, as applicable, acquisition and integration related costs, amortization of acquired intangible assets, severance and benefit costs, impairment of goodwill, and any related income tax-related adjustments, and EBITDA and adjusted EBITDA. The presentation of this financial information is not intended to be considered in isolation, or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

We use these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. Our management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our "core operating performance." Management believes that "core operating performance" represents Align's performance in the ordinary, ongoing and customary course of its operations. Accordingly, management excludes from "core operating performance" certain expenditures and other items that may not be indicative of our operating performance including discrete cash and non-cash charges that are infrequent or one-time in nature. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting and analyzing future periods. These non-GAAP financial measures also facilitate management's internal evaluation of period-to-period comparisons. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision making and (2) they are provided to and used by our institutional investors and the analyst community to facilitate comparisons with prior and subsequent reporting periods. A reconciliation of the GAAP and non-GAAP financial measures for the quarter and year and a more detailed explanation of each non-GAAP financial measure and its uses are provided in the footnotes to the table captioned "Reconciliation of GAAP to non-GAAP Key Financial Metrics" and "Business Outlook Summary" included at the end of this release.

Forward-Looking Statement
This news release, including the tables below, contains forward-looking statements, including statements regarding certain business metrics for the first quarter of 2013, including anticipated net revenue, gross margin, operating expense, operating income, earnings per share, case shipments and cash. Forward-looking statements contained in this news release and the tables below relating to expectations about future events or results are based upon information available to Align as of the date hereof. Readers are cautioned that these forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions that are difficult to predict. As a result, actual results may differ materially and adversely from those expressed in any forward-looking statement. Factors that might cause such a difference include, but are not limited to, difficulties predicting customer and consumer purchasing behavior, the willingness and ability of our customers to maintain and/or increase utilization in sufficient numbers, the possibility that the development and release of new products does not proceed in accordance with the anticipated timeline, the possibility that the market for the sale of these new products may not develop as expected, the risks relating to Align's ability to sustain or increase profitability or revenue growth in future periods while controlling expenses, growth related risks, including capacity constraints and pressure on our internal systems and personnel, our ability to successfully achieve the anticipated benefits from the acquisition of Cadent Holdings, Inc., continued customer demand for our existing and new products, changes in consumer spending habits as a result of, among other things, prevailing economic conditions, levels of employment, salaries and wages and consumer confidence, the timing of case submissions from our doctors within a quarter, acceptance of our products by consumers and dental professionals, foreign operational, political and other risks relating to Align's international manufacturing operations, Align's ability to protect its intellectual property rights, continued compliance with regulatory requirements, competition from existing and new competitors, Align's ability to develop and successfully introduce new products and product enhancements, the loss of key personnel and impairments in the book value of goodwill or other intangible assets. These and other risks are detailed from time to time in Align's periodic reports filed with the Securities and Exchange Commission, including, but not limited to, its Annual Report on Form 10-K for the fiscal year ended December 31, 2011, which was filed with the Securities and Exchange Commission on February 29, 2012. Align undertakes no obligation to revise or update publicly any forward-looking statements for any reason.


ALIGN TECHNOLOGY, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)

                      Three Months Ended                Year Ended
                 ----------------------------  ----------------------------
                  December 31,   December 31,   December 31,   December 31,
                      2012           2011           2012           2011
                 -------------  -------------  -------------  -------------

Net revenues     $     142,840        128,905  $     560,041        479,741

Cost of revenues        36,362         33,355        143,653        118,458
                 -------------  -------------  -------------  -------------

Gross profit           106,478         95,550        416,388        361,283
                 -------------  -------------  -------------  -------------

Operating
 expenses:
 Sales and
  marketing             37,769         36,112        152,041        142,174
 General and
  administrative        27,166         22,457         95,840         89,152
 Research and
  development           11,711          9,568         42,869         37,154
 Impairment of
  goodwill              11,926              -         36,591              -
 Amortization of
  acquired
  intangible
  assets                   835            983          3,455          2,443
                 -------------  -------------  -------------  -------------
Total operating
 expenses               89,407         69,120        330,796        270,923
                 -------------  -------------  -------------  -------------

Profit from
 operations             17,071         26,430         85,592         90,360

Interest and
 other income
 (expense), net           (672)           (84)        (1,296)          (419)
                 -------------  -------------  -------------  -------------

Profit before
 income taxes           16,399         26,346         84,296         89,941

Provision for
 income taxes            6,840          5,897         25,605         23,225
                 -------------  -------------  -------------  -------------

Net profit       $       9,559  $      20,449  $      58,691  $      66,716
                 =============  =============  =============  =============

Net profit per
 share
 - basic         $        0.12  $        0.26  $        0.73  $        0.86
                 =============  =============  =============  =============
 - diluted       $        0.12  $        0.25  $        0.71  $        0.83
                 =============  =============  =============  =============

Shares used in
 computing net
 profit per
 share
 - basic                81,043         78,737         80,528         77,988
                 =============  =============  =============  =============
 - diluted              82,981         80,849         83,040         80,294
                 =============  =============  =============  =============



ALIGN TECHNOLOGY, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)

                                              December 31,    December 31,
                                                   2012            2011

                                             --------------- ---------------
                   ASSETS

Current assets:
  Cash and cash equivalents                  $       306,386 $       240,675
  Restricted cash                                      1,575           4,026
  Marketable securities, short-term                   28,485           7,395
  Accounts receivable, net                            98,992          91,537
  Inventories                                         15,122           9,402
  Other current assets                                35,233          31,781
                                             --------------- ---------------
    Total current assets                             485,793         384,816

Marketable securities, long-term                      21,252               -
Property and equipment, net                           79,191          53,965
Goodwill and intangible assets, net                  145,013         185,405
Deferred tax assets                                   21,609          22,337
Other long-term assets                                 3,454           2,741
                                             --------------- ---------------

    Total assets                             $       756,312 $       649,264
                                             =============== ===============

    LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Accounts payable                           $        19,549 $        19,265
  Accrued liabilities                                 74,247          76,600
  Deferred revenue                                    65,239          52,252
                                             --------------- ---------------
    Total current liabilities                        159,035         148,117

Other long term liabilities                           15,960          10,366
                                             --------------- ---------------

    Total liabilities                                174,995         158,483

Total stockholders' equity                           581,317         490,781
                                             --------------- ---------------

  Total liabilities and stockholders' equity $       756,312 $       649,264
                                             =============== ===============



ALIGN TECHNOLOGY, INC.
RECONCILIATION OF GAAP TO NON-GAAP KEY FINANCIAL METRICS



Reconciliation of GAAP to
 Non-GAAP Gross Profit
(in thousands)
                                           Three Months Ended
                             ----------------------------------------------
                              December 31,    September 30,   December 31,
                                  2012            2012            2011
                             --------------  --------------  --------------

GAAP Gross profit            $      106,478  $      100,350  $       95,550
  Acquisition and
   integration costs related
   to cost of revenues (1)                -              55             139
  Amortization of acquired
   intangible assets related
   to cost of revenues (2)              201             213             285
  Severance and benefit
   costs related to cost of
   revenues(3)                            -              39             579
                             --------------  --------------  --------------
Non-GAAP Gross profit        $      106,679  $      100,657  $       96,553
                             ==============  ==============  ==============

Reconciliation of GAAP to
 Non-GAAP Gross Profit
 Scanner and CAD/CAM
 Services
(in thousands)
                                            Three Months Ended
                             ----------------------------------------------
                               December 31,   September 30,    December 31,
                                   2012            2012            2011
                             --------------  --------------  --------------

GAAP Scanner and CAD/CAM
 Services gross profit       $        1,848  $        2,016  $        1,993
  Acquisition and
   integration costs related
   to cost of revenues (1)                -              55             139
  Amortization of acquired
   intangible assets related
   to cost of revenues (2)              201             213             285
  Severance and benefit
   costs related to cost of
   revenues(3)                            -              39             579
                             --------------  --------------  --------------
Non-GAAP Gross profit        $        2,049  $        2,323  $        2,996
                             ==============  ==============  ==============

Reconciliation of GAAP to
 Non-GAAP Operating Expenses
(in thousands)
                                            Three Months Ended
                             ----------------------------------------------
                               December 31,   September 30,    December 31,
                                   2012            2012            2011
                             --------------  --------------  --------------

GAAP Operating expenses      $       89,407  $       95,847  $       69,120
  Acquisition and
   integration costs related
   to operating expenses (1)              -            (179)         (1,005)
  Amortization of acquired
   intangible assets related
   to operating expenses (2)           (835)           (866)           (983)
  Severance and benefit
   costs related to
   operating expenses (3)                 -            (105)           (256)
  Impairment of goodwill (4)        (11,926)        (24,665)              -
                             --------------  --------------  --------------
Non-GAAP Operating expenses  $       76,646  $       70,032  $       66,876
                             ==============  ==============  ==============

Reconciliation of GAAP to
 Non-GAAP Profit from
 Operations
(in thousands)
                                            Three Months Ended
                             ----------------------------------------------
                               December 31,   September 30,    December 31,
                                   2012            2012            2011
                             --------------  --------------  --------------

GAAP Profit from operations  $       17,071  $        4,503  $       26,430
  Acquisition and
   integration costs (1)                  -             234           1,144
  Amortization of acquired
   intangible assets (2)              1,036           1,079           1,268
  Severance and benefit
   costs (3)                              -             144             835
  Impairment of goodwill             11,926          24,665               -
                             --------------  --------------  --------------
Non-GAAP Profit from
 operations                  $       30,033  $       30,625  $       29,677
                             ==============  ==============  ==============

Reconciliation of GAAP to
 Non-GAAP Net Profit
(in thousands, except per
 share amounts)
                                            Three Months Ended
                             ----------------------------------------------
                               December 31,   September 30,    December 31,
                                   2012            2012            2011
                             --------------  --------------  --------------

GAAP Net profit (loss)       $        9,559  $         (344) $       20,449
  Acquisition and
   integration costs (1)                  -             234           1,144
  Amortization of acquired
   intangible assets (2)              1,036           1,079           1,268
  Severance and benefit
   costs (3)                              -             144             835
  Impairment of goodwill (4)         11,926          24,665               -
  Income tax-related
   adjustments (5)                     (193)         (2,078)           (715)
                             --------------  --------------  --------------
Non-GAAP Net profit          $       22,328  $       23,700  $       22,981
                             ==============  ==============  ==============

Diluted Net profit (loss)
 per share:
    GAAP                     $         0.12  $        (0.00) $         0.25
                             ==============  ==============  ==============
    Non-GAAP                 $         0.27  $         0.28  $         0.28
                             ==============  ==============  ==============

Shares used in computing
 diluted GAAP Net profit
 (loss) per share                    82,981          81,437          80,849
                             ==============  ==============  ==============
Shares used in computing
 diluted Non-GAAP Net profit
 per share                           82,981          83,906          80,849
                             ==============  ==============  ==============

Reconciliation of GAAP Net
 Profit to EBITDA and
 Adjusted EBITDA
(in thousands)
                                            Three Months Ended
                             ----------------------------------------------
                               December 31,   September 30,    December 31,
                                   2012            2012            2011
                             --------------  --------------  --------------

GAAP Net profit (loss)       $        9,559  $         (344) $       20,449
Provision for income taxes            6,840           4,494           5,897
Depreciation and
 amortization (6)                     5,278           4,374           4,320
                             --------------  --------------  --------------
EBITDA (7)                           21,677           8,524          30,666
                             --------------  --------------  --------------

Adjustments or charges:
  Acquisition and
   integration related costs
   (1)                                    -             234           1,144
  Severance and benefit
   costs (3)                              -             144             835
  Impairment of goodwill (4)         11,926          24,665               -
                             --------------  --------------  --------------
EBITDA after adjustments (7) $       33,603  $       33,567  $       32,645
                             ==============  ==============  ==============



ALIGN TECHNOLOGY, INC.
RECONCILIATION OF GAAP TO NON-GAAP KEY FINANCIAL METRICS

Reconciliation of GAAP to Non-GAAP Gross Profit
(in thousands)
                                                       Year Ended
                                             ------------------------------
                                              December 31,    December 31,
                                                  2012            2011
                                             --------------  --------------

GAAP Gross profit                            $      416,388  $      361,283
  Acquisition and integration costs related
   to cost of revenues (1)                              261             398
  Amortization of acquired intangible assets
   related to cost of revenues (2)                      907             735
  Severance and benefit costs related to
   cost of revenues (3)                                 474             754
                                             --------------  --------------
Non-GAAP Gross profit                        $      418,030  $      363,170
                                             ==============  ==============

Reconciliation of GAAP to Non-GAAP Gross
 Profit Scanner and CAD/CAM Services
(in thousands)
                                                        Year Ended
                                             ------------------------------
                                               December 31,    December 31,
                                                   2012            2011
                                             --------------  --------------

GAAP Scanner and CAD/CAM Services gross
 profit                                      $       10,418  $        6,640
  Acquisition and integration costs related
   to cost of revenues (1)                              261             398
  Amortization of acquired intangible assets
   related to cost of revenues (2)                      907             735
  Severance and benefit costs related to
   cost of revenues(3)                                  474             754
                                             --------------  --------------
Non-GAAP Gross profit                        $       12,060  $        8,527
                                             ==============  ==============

Reconciliation of GAAP to Non-GAAP Operating
 Expenses
(in thousands)
                                                        Year Ended
                                             ------------------------------
                                               December 31,    December 31,
                                                   2012            2011
                                             --------------  --------------

GAAP Operating expenses                      $      330,796  $      270,923
  Acquisition and integration costs related
   to operating expenses (1)                         (1,010)         (9,632)
  Amortization of acquired intangible assets
   related to operating expenses (2)                 (3,455)         (2,443)
  Severance and benefit costs related to
   operating expenses (3)                              (306)           (328)
  Impairment of goodwill (4)                        (36,591)              -
                                             --------------  --------------
Non-GAAP Operating expenses                  $      289,434  $      258,520
                                             ==============  ==============


Reconciliation of GAAP to Non-GAAP Profit
 from Operations
(in thousands)
                                                        Year Ended
                                             ------------------------------
                                               December 31,    December 31,
                                                   2012            2011
                                             --------------  --------------

GAAP Profit from Operations                  $       85,592  $       90,360
  Acquisition and integration costs related
   to cost of revenues (1)                            1,271          10,030
  Amortization of acquired intangible assets
   related to cost of revenues (2)                    4,362           3,178
  Severance and benefit costs related to
   cost of revenues (3)                                 780           1,082
  Impairment of goodwill (4)                         36,591               -
                                             --------------  --------------
Non-GAAP Profit from Operations              $      128,596  $      104,650
                                             ==============  ==============


Reconciliation of GAAP to Non-GAAP Net
 Profit
(in thousands, except per share amounts)
                                                        Year Ended
                                             ------------------------------
                                               December 31,    December 31,
                                                   2012            2011
                                             --------------  --------------

GAAP Net profit                              $       58,691  $       66,716
  Acquisition and integration costs related
   to cost of revenues (1)                            1,271          10,030
  Amortization of acquired intangible assets
   related to cost of revenues (2)                    4,362           3,178
  Severance and benefit costs related to
   cost of revenues (3)                                 780           1,082
  Impairment of goodwill (4)                         36,591               -
  Tax effect on non-GAAP adjustments (5)             (4,947)         (2,862)
                                             --------------  --------------
Non-GAAP Net profit                          $       96,748  $       78,144
                                             ==============  ==============

Diluted Net profit per share:
    GAAP                                     $         0.71  $         0.83
                                             ==============  ==============
    Non-GAAP                                 $         1.17  $         0.97
                                             ==============  ==============

Shares used in computing diluted GAAP net
 profit per share                                    83,040          80,294
                                             ==============  ==============
Shares used in computing diluted non-GAAP
 net profit per share                                83,040          80,294
                                             ==============  ==============


Reconciliation of GAAP Net Profit to EBITDA
 and Adjusted EBITDA
(in thousands)
                                                        Year Ended
                                             ------------------------------
                                               December 31,    December 31,
                                                   2012            2011
                                             --------------  --------------

GAAP Net profit                              $       58,691  $       66,716
Provision for income taxes                           25,605          23,225
Depreciation and amortization (6)                    17,811          17,477
                                             --------------  --------------
EBITDA (7)                                          102,107         107,418
                                             --------------  --------------

Adjustments or charges:
  Acquisition and integration related costs
   (1)                                                1,271          10,030
  Severance and benefit costs (3)                       780           1,082
  Impairment of goodwill (4)                         36,591               -
                                             --------------  --------------
EBITDA after adjustments (7)                 $      140,749  $      118,530
                                             ==============  ==============

(1) Acquisition costs and integration related. We have incurred acquisition-related and other expenses which include legal, banker, accounting and other advisory fees of third parties, retention bonuses, integration and professional fees. We do not engage in acquisitions in the ordinary course of business. We believe that it is important to understand these charges; however, we do not believe that these charges are indicative of future operating results. We believe that eliminating these expenses from our non-GAAP measures is useful because we generally would not have otherwise incurred such expenses in the periods presented as part of our continuing operations.

(2) Amortization of acquired intangible assets. When conducting internal development of intangible assets (including developed technology, customer relationships, trademarks, etc.), GAAP accounting rules require that we expense the costs as incurred. In the case of acquired businesses, however, we are required to allocate a portion of the purchase price to the accounting value assigned to intangible assets acquired and amortize this amount over the estimated useful lives of the acquired intangibles. The acquired company, in most cases, has itself previously expensed the costs incurred to develop the acquired intangible assets, and the purchase price allocated to these assets is not necessarily reflective of the cost we would incur in developing the intangible asset. We eliminate these amortization charges for our non-GAAP operating results to provide better comparability of pre and post-acquisition operating results and comparability to results of businesses utilizing internally developed intangible assets.

(3) Severance and benefits costs. These costs are related to the closure of our New Jersey operations and were realized through the first three quarters of 2012. We have engaged in various restructuring and exit activities in 2011 and 2009 that have resulted in costs associated with severance and benefits. Such activity has been a discrete event based on a unique set of business objectives or circumstances, and each has differed from the others in terms of its operational implementation, business impact and scope. We do not engage in restructuring and/or exit activities in the ordinary course of business. We believe that it is important to understand significant severance and benefits costs and, we believe that investors benefit from excluding these charges from our operating results to facilitate a more meaningful evaluation of current operating performance and comparisons to past operating performance.

(4) Impairment of goodwill. This cost represents non-cash write-downs of our goodwill. During the third quarter of 2012, we determined that there were sufficient indicators such as the termination of our distribution agreement with Straumann for iTero intra-oral scanners as well as the market conditions and business trends within our Scanners and CAD/CAM Services reporting unit for an impairment of goodwill. We remove the impact of these charges to our operating performance to assist in assessing our ability to generate cash from operations. We believe this may be useful information to users of our financial statements and therefore we have excluded these charges for purposes of calculating these non-GAAP measures to facilitate an evaluation of our current operating performance, particularly in terms of liquidity.

(5) Income tax-related adjustments. Non-GAAP financial information for the quarter is adjusted for a tax rate equal to our annual estimated tax rate on non-GAAP income. This rate is based on our estimated annual GAAP income tax rate forecast, adjusted to account for discrete tax items and items excluded from GAAP income in calculating the non-GAAP financial measures presented above. Our estimated tax rate on non-GAAP income is determined annually and may be re-calculated during the year to take into account events or trends that we believe materially impact the estimated annual rate.

(6) Includes the amortization of acquired intangible assets.

(7) EBITDA and adjusted EBITDA. We use EBITDA as a performance measure for benchmarking against our peers and competitors. We believe EBITDA is useful to investors because it is frequently used by securities analysts, investors and other interested parties to evaluate companies in the medical technology industry. We also use adjusted EBITDA which excludes certain special or non-recurring expenses, net of certain special or non-recurring benefits, detailed in the reconciliation tables that accompany this release, as an internal measure of business operating performance. We believe such financial measures provide a meaningful perspective of the underlying operating performance to our current business. EBITDA and adjusted EBITDA are not recognized terms under GAAP. Because all companies do not calculate EBITDA and similarly titled financial measures in the same way, those measures as used by other companies may not be consistent with the way we calculate such measures and should not be considered as alternative measures of operating or net profit.


ALIGN TECHNOLOGY
Q4 2012 EARNINGS RELEASE ADDITIONAL DATA
REVENUE PERFORMANCE AND CLEAR ALIGNER METRICS
(in thousands except per share data)

                                                                  ----------
                              Q1        Q2        Q3        Q4      FISCAL
                             2012      2012      2012      2012      2012
Invisalign Clear Aligner
 Revenues by Geography:
 North America             $ 86,871  $ 92,997  $ 89,568  $ 91,686  $361,122
  North American
   Orthodontists             41,688    43,942    43,090    43,812   172,532
  North American GP
   Dentists                  45,183    49,055    46,478    47,874   188,590
  International              29,700    32,883    29,700    32,513   124,796
  Non-case*                   6,757     7,789     7,457     8,660    30,663
                           --------  --------  --------  --------  --------
  Total Clear Aligner
   Revenue                 $123,328  $133,669  $126,725  $132,859  $516,581
                           ========  ========  ========  ========  ========
   YoY % growth                17.6%     17.6%     10.9%     11.7%     14.4%
   QoQ % growth                 3.7%      8.4%     -5.2%      4.8%
 *includes Invisalign
  training, ancillary
  products, and retainers
Invisalign Clear Aligner
 Revenues by Product:
 Invisalign Full           $ 82,424  $ 88,617  $ 80,294  $ 87,265  $338,600
 Invisalign Express/Lite     11,806    13,632    12,779    13,269    51,486
 Invisalign Teen             15,148    16,380    19,144    16,455    67,127
 Invisalign Assist            7,193     7,251     7,051     7,210    28,705
 Non-case*                    6,757     7,789     7,457     8,660    30,663
                           --------  --------  --------  --------  --------
  Total Clear Aligner
   Revenue                 $123,328  $133,669  $126,725  $132,859  $516,581
                           ========  ========  ========  ========  ========

Average Invisalign Selling
 Price (ASP), as billed:
 Total Worldwide Blended
  ASP                      $  1,370  $  1,335  $  1,320  $  1,375  $  1,350
 International ASP         $  1,485  $  1,455  $  1,355  $  1,455  $  1,440

Invisalign Clear Aligner
 Cases Shipped by
 Geography:
 North America               65,280    72,685    70,610    68,140   276,715
  North American
   Orthodontists             32,235    35,420    35,885    33,505   137,045
  North American GP
   Dentists                  33,045    37,265    34,725    34,635   139,670
 International               19,985    22,595    21,905    22,340    86,825
                           --------  --------  --------  --------  --------
  Total Cases Shipped        85,265    95,280    92,515    90,480   363,540
                           ========  ========  ========  ========  ========

Invisalign Clear Aligner
 Cases Shipped by Product:
 Invisalign Full             57,145    62,510    57,400    57,920   234,975
 Invisalign Express/Lite     12,855    15,300    14,610    15,940    58,705
 Invisalign Teen              9,935    11,860    15,265    11,255    48,315
 Invisalign Assist            5,330     5,610     5,240     5,365    21,545
                           --------  --------  --------  --------  --------
  Total Cases Shipped        85,265    95,280    92,515    90,480   363,540
                           ========  ========  ========  ========  ========

Number of Invisalign
 Doctors Cases Shipped to:
 North American
  Orthodontists               4,460     4,575     4,660     4,615     5,665
 North American GP
  Dentists                   11,365    12,120    11,925    11,685    19,285
 International                5,085     5,480     5,400     5,715     9,285
                           --------  --------  --------  --------  --------
  Total Doctors Cases were
   Shipped to Worldwide      20,910    22,175    21,985    22,015    34,235
                           ========  ========  ========  ========  ========

Invisalign Doctor
 Utilization Rates*:
 North American
  Orthodontists                 7.2       7.7       7.7       7.3      24.2
 North American GP
  Dentists                      2.9       3.1       2.9       3.0       7.2
 International                  3.9       4.1       4.1       3.9       9.4
                           --------  --------  --------  --------  --------
  Total Utilization Rates       4.1       4.3       4.2       4.1      10.6
                           ========  ========  ========  ========  ========
 * # of cases shipped/# of
  doctors to whom cases
  were shipped
Number of Invisalign
 Doctors Trained:
 North American
  Orthodontists                  90        95       125        75       385
 North American GP
  Dentists                      720       995       675       920     3,310
 International                  715       965       685       780     3,145
                           --------  --------  --------  --------  --------
  Total Doctors Trained
   Worldwide                  1,525     2,055     1,485     1,775     6,840
                           ========  ========  ========  ========  ========
  Total to Date Worldwide    71,180    73,235    74,720    76,495    76,495
                           ========  ========  ========  ========  ========

Scanner and CAD/CAM
 Services Revenue:
 North America Scanner and
  CAD/CAM Services         $ 11,120  $ 11,752  $  9,439  $  9,940  $ 42,251
 International Scanner and
  CAD/CAM Services              631       205       332        41     1,209
                           --------  --------  --------  --------  --------
  Total Scanner and
   CAD/CAM Revenue         $ 11,751  $ 11,957  $  9,771  $  9,981  $ 43,460
                           ========  ========  ========  ========  ========

 Scanner Revenue           $  5,361  $  6,032  $  4,023  $  4,643  $ 20,059
 CAD/CAM Services Revenue     6,390     5,925     5,748     5,338    23,401
                           --------  --------  --------  --------  --------
  Total Scanner and
   CAD/CAM Services
   Revenue                 $ 11,751  $ 11,957  $  9,771  $  9,981  $ 43,460
                           ========  ========  ========  ========  ========

Total Revenue by
 Geography:
 Total North America
  Revenue                  $ 97,991  $104,749  $ 99,007  $101,626  $403,373
 Total International
  Revenue                    30,331    33,088    30,032    32,554   126,005
 Total Non-case Revenue       6,757     7,789     7,457     8,660    30,663
                           --------  --------  --------  --------  --------
  Total Worldwide Revenue  $135,079  $145,626  $136,496  $142,840  $560,041
                           ========  ========  ========  ========  ========
   YoY % growth                28.8%     21.3%      8.4%     10.8%     16.7%
   QoQ % growth                 4.8%      7.8%     -6.3%      4.6%
                                                                  ----------

Note: Historical public data may differ due to rounding. Additionally,
 rounding may effect totals.



ALIGN TECHNOLOGY, INC.
BUSINESS OUTLOOK SUMMARY
(unaudited)

The outlook figures provided below and elsewhere in this press release are
 approximate in nature since Align's business outlook is difficult to
 predict. Align's future performance involves numerous risks and
 uncertainties and the company's results could differ materially from the
 outlook provided. Some of the factors that could affect Align's future
 financial performance and business outlook are set forth under "Forward
 Looking Information" above in this press release.

Financials
(in millions, except per share amounts and percentages)

                                                                 Q1 2013
                                                             ---------------

Net Revenue                                                  $146.0 - $150.5

Gross Profit                                                 $105.8 - $110.1

Gross Margin                                                  72.4% - 73.1%

Operating Expenses                                            $82.8 - $84.4

Operating Margin                                              15.8% - 17.1%

Net Income per Diluted Share                                  $0.21 - $0.23

Stock Based Compensation Expense:
Cost of Revenues                                                   $0.7
Operating Expenses                                                 $6.3
                                                             ---------------
Total Stock Based Compensation Expense                             $7.0

Business Metrics:
                                                                 Q1 2013
                                                             ---------------
Case Shipments                                                95.0K - 97.5K
Cash, Cash Equivalents, and Marketable Securities            $365M - $375M *
Capex                                                         $3.5M - $5.0M
Depreciation & Amortization                                   $4.5M - $5.0M
Diluted Shares Outstanding                                        83.2M*

* Excludes any stock repurchases during the quarter

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
SYS-CON Events announced today that 910Telecom will exhibit 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. Housed in the classic Denver Gas & Electric Building, 910 15th St., 910Telecom is a carrier-neutral telecom hotel located in the heart of Denver. Adjacent to CenturyLink, AT&T, and Denver Main, 910Telecom offers connectivity to all major carriers, Internet service providers, Internet backbones and ...
Big Data, cloud, analytics, contextual information, wearable tech, sensors, mobility, and WebRTC: together, these advances have created a perfect storm of technologies that are disrupting and transforming classic communications models and ecosystems. In his session at @ThingsExpo, Erik Perotti, Senior Manager of New Ventures on Plantronics’ Innovation team, provided an overview of this technological shift, including associated business and consumer communications impacts, and opportunities it ...
You think you know what’s in your data. But do you? Most organizations are now aware of the business intelligence represented by their data. Data science stands to take this to a level you never thought of – literally. The techniques of data science, when used with the capabilities of Big Data technologies, can make connections you had not yet imagined, helping you discover new insights and ask new questions of your data. In his session at @ThingsExpo, Sarbjit Sarkaria, data science team lead ...
WebRTC is bringing significant change to the communications landscape that will bridge the worlds of web and telephony, making the Internet the new standard for communications. Cloud9 took the road less traveled and used WebRTC to create a downloadable enterprise-grade communications platform that is changing the communication dynamic in the financial sector. In his session at @ThingsExpo, Leo Papadopoulos, CTO of Cloud9, discussed the importance of WebRTC and how it enables companies to focus...
ReadyTalk has expanded the capabilities of the FoxDen collaboration platform announced late last year to include FoxDen Connect, an in-room video collaboration experience that launches with a single touch. With FoxDen Connect, users can now not only engage in HD video conferencing between iOS and Android mobile devices or Chrome browsers, but also set up in-person meeting rooms for video interactions. A host’s mobile device automatically recognizes the presence of a meeting room via beacon tech...
Manufacturers are embracing the Industrial Internet the same way consumers are leveraging Fitbits – to improve overall health and wellness. Both can provide consistent measurement, visibility, and suggest performance improvements customized to help reach goals. Fitbit users can view real-time data and make adjustments to increase their activity. In his session at @ThingsExpo, Mark Bernardo Professional Services Leader, Americas, at GE Digital, discussed how leveraging the Industrial Internet a...
On Dice.com, the number of job postings asking for skill in Amazon Web Services increased 76 percent between June 2015 and June 2016. Salesforce.com saw its own skill mentions increase 37 percent, while DevOps and Cloud rose 35 percent and 28 percent, respectively. Even as they expand their presence in the cloud, companies are also looking for tech professionals who can manage projects, crunch data, and figure out how to make systems run more autonomously. Mentions of ‘data science’ as a skill ...
IoT generates lots of temporal data. But how do you unlock its value? You need to discover patterns that are repeatable in vast quantities of data, understand their meaning, and implement scalable monitoring across multiple data streams in order to monetize the discoveries and insights. Motif discovery and deep learning platforms are emerging to visualize sensor data, to search for patterns and to build application that can monitor real time streams efficiently. In his session at @ThingsExpo, ...
"delaPlex is a software development company. We do team-based outsourcing development," explained Mark Rivers, COO and Co-founder of delaPlex Software, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
Amazon has gradually rolled out parts of its IoT offerings in the last year, but these are just the tip of the iceberg. In addition to optimizing their back-end AWS offerings, Amazon is laying the ground work to be a major force in IoT – especially in the connected home and office. Amazon is extending its reach by building on its dominant Cloud IoT platform, its Dash Button strategy, recently announced Replenishment Services, the Echo/Alexa voice recognition control platform, the 6-7 strategic...
SYS-CON Events announced today that LeaseWeb USA, a cloud Infrastructure-as-a-Service (IaaS) provider, will exhibit 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. LeaseWeb is one of the world's largest hosting brands. The company helps customers define, develop and deploy IT infrastructure tailored to their exact business needs, by combining various kinds cloud solutions.
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...
For basic one-to-one voice or video calling solutions, WebRTC has proven to be a very powerful technology. Although WebRTC’s core functionality is to provide secure, real-time p2p media streaming, leveraging native platform features and server-side components brings up new communication capabilities for web and native mobile applications, allowing for advanced multi-user use cases such as video broadcasting, conferencing, and media recording.
SYS-CON Events announced today that Venafi, the Immune System for the Internet™ and the leading provider of Next Generation Trust Protection, will exhibit at @DevOpsSummit at 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Venafi is the Immune System for the Internet™ that protects the foundation of all cybersecurity – cryptographic keys and digital certificates – so they can’t be misused by bad guys in attacks...
There will be new vendors providing applications, middleware, and connected devices to support the thriving IoT ecosystem. This essentially means that electronic device manufacturers will also be in the software business. Many will be new to building embedded software or robust software. This creates an increased importance on software quality, particularly within the Industrial Internet of Things where business-critical applications are becoming dependent on products controlled by software. Qua...
In addition to all the benefits, IoT is also bringing new kind of customer experience challenges - cars that unlock themselves, thermostats turning houses into saunas and baby video monitors broadcasting over the internet. This list can only increase because while IoT services should be intuitive and simple to use, the delivery ecosystem is a myriad of potential problems as IoT explodes complexity. So finding a performance issue is like finding the proverbial needle in the haystack.
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...
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportuni...
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and shared the must-have mindsets for removing complexity from the develo...
SYS-CON Events announced today that MangoApps will exhibit 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. MangoApps provides modern company intranets and team collaboration software, allowing workers to stay connected and productive from anywhere in the world and from any device.