Home Diagnostics, Inc. (HDIX), a manufacturer of diabetes testing supplies, announced Tuesday an increase in fourth-quarter net income, helped by higher sales across all channels of business.
Net income for fourth quarter increased to $1.7 million, or $0.09 a share, from $0.1 million, or $0.01 a share last year.
The company benefited from a $0.6 million reduction in tax provision reflecting reduced tax reserves following the expiration of tax statutes of limitation. Net income for the prior-year period included a $3.5 million after-tax patent litigation settlement charge.
On an average, six analysts polled by Thomson Reuters expected the company to report earnings of $0.05 per share in the fourth quarter. Analysts' estimate typically excludes special items.
Total revenue for the quarter rose 6.4% to $29.5 million from $27.8 million for the year-ago period. Five analysts expected the company to report revenue of $30.39 million in the fourth quarter.
Research and development expenses reduced to $1.8 million from $2.4 million, mainly due to lower new product development costs following the launch of the company's TRUE2go and TRUEresult systems.
For the full year, net income slightly rose to $9.64 million, or $0.51 a share, from $9.63 million, or $0.49 a share, in 2007. Net sales expanded to $123.58 million from $115.60 million.
Looking forward, the company expects first quarter revenue to be down mid single digits, reflecting the anticipated reduction in inventory days supply at wholesale distribution customers.
Considering the revenue forecast and the continued investment in the distribution of its new no code products as well as costs associated with the transition of its newly appointed chief executive officer, Joseph Capper, the company expects a net loss of around $3 million for the first quarter.
Home Diagnostics said that it would provide fiscal 2009 outlook along with the first quarter results in order to allow its CEO to complete his evaluation of the company's business plan.
HDIX is currently trading at $6.72, down $0.12 or 1.75%, on the Nasdaq.
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