Span-America Medical Systems, Inc. (NASDAQ: SPAN) announced that it plans to release its fiscal 2014 third quarter results on Monday, August 4, 2014, after the regular close of trading. The Company also updated its earnings outlook for the second half of fiscal 2014.
“We expect our earnings for the second half of fiscal 2014 to be similar to the $0.52 per diluted share reported in the first half, which is lower than our previous outlook, because of lower than expected sales volume in the third quarter,” stated Jim Ferguson, president and chief executive officer of Span-America. “We experienced weak demand for our medical products during April and May as well as delays in the start-up of some new consumer business during the quarter. Sales rebounded in June but not enough to offset our performance in the first two months of the quarter. As a result, we believe the shortfall in sales will cause third quarter earnings to be lower than we originally expected.”
“Although we experienced some short-term weakness in our medical business in the third quarter, we believe the long-term outlook for the company is excellent,” continued Mr. Ferguson. "We are continuing to develop and introduce new medical products, which we believe will contribute to our future sales growth. We have substantial positive free cash flow and a strong balance sheet with high liquidity and no debt. We are also pleased to have paid 98 consecutive quarterly dividends in addition to four special dividends. We have increased our quarterly dividend 12 times since initiation in 1990, and we will continue to look for opportunities to provide additional value to our shareholders in the future,” concluded Mr. Ferguson.
Span-America’s management expects to provide a full update on the third quarter’s results as well as expectations for the company’s fourth fiscal quarter during the upcoming conference call to be held at 10:00 a.m. ET on Tuesday, August 5, 2014. A live broadcast of the conference call will be available online at www.spanamerica.com under “Investor Relations” on the “About Us” tab. The online replay will follow immediately and continue for 30 days.
About Span-America Medical Systems, Inc.
Span-America manufactures and markets a comprehensive selection of pressure management products for the medical market, including Geo-Matt®, PressureGuard®, Geo-Mattress®, Custom Care®, Span+Aids®, Isch-Dish®, Risk Manager® and Selan® products. We also supply custom foam and packaging products to the consumer and industrial markets. Through our wholly-owned subsidiary Span Medical Products Canada Inc., we manufacture and market the M.C. Healthcare Products brands of Encore™, Maxxum, Advantage and Rexx bed frames as well as related case goods, tables and seating products for the long-term care market. Span-America’s stock is traded on The NASDAQ Global Market under the symbol “SPAN.” For more information, visit www.spanamerica.com and www.mchealthcare.com.
Forward-Looking Statements
We have made forward-looking statements in this release regarding, among other things, our expectations for future sales and earnings performance. We wish to caution the reader that these statements are only predictions. These forward-looking statements may be generally identified by the use of forward-looking words and phrases such as “will,” “intends,” “may,” “believes,” “anticipates,” “should” and “expects,” and are based on the company’s current expectations or beliefs concerning future events that involve risks and uncertainties. Actual events or results may differ materially as a result of risks and uncertainties facing the company, including: (a) the inability to achieve anticipated growth in sales of medical and industrial products during fiscal 2014, (b) the possibility of disruptions in our consumer products business related to the transfer of our exclusive distribution agreement from Louisville Bedding Company to Hollander Home Fashions in May 2013 as a result of the sale of Louisville Bedding’s utility bedding retail business to Hollander, (c) the possibility of a loss of a key customer or distributor for our products, (d) risks related to international operations and foreign exchange associated with our Canadian subsidiary, (e) the possibility of having material uncollectible receivables from one or more key customers or distributors, (f) the potential for volatile pricing conditions in the market for polyurethane foam, (g) raw material cost increases, (h) the possibility that some or all of our medical products could be determined to be subject to the 2.3% medical device excise tax imposed by the Affordable Care Act, (i) the potential for lost sales due to competition from low-cost foreign imports, (j) changes in relationships with large customers or key suppliers, (k) the impact of competitive products and pricing, (l) government reimbursement changes in the medical market, (m) FDA and Health Canada regulation of medical device manufacturing and (n) other risks referenced from time to time in our Securities and Exchange Commission filings. We disclaim any obligation to update publicly any forward-looking statement, whether as a result of new information, future events or otherwise. We are not responsible for changes made to this document by wire services or Internet services.
Contacts:
Jim Ferguson, 864-288-8877, ext.
6912
President and Chief Executive Officer
