On May 22, 2006, Mentor (NYSE:MNT) released fiscal year 2006 earnings for the year ended March 31.

  • For the full year, revenue beat expectations when including discontinued operations, but earnings per share missed.
  • For FY 2007, expect stock-based compensation costs of $0.17 per share, far above the $0.03 impact to FY 2006, as Mentor implements the new reporting requirement.
  • Revenue guidance for FY 2007 was $290 to $305 million for continuing operations, an increase of 11% over the just-ended year. No earnings guidance, though.

(Figures in thousands, except per-share data)

Income Statement Highlights

Avg. Est.

FY 2006

FY 2005

Change

Sales*

$502,000

$268,272

$251,726

6.6%

Net Profit**

--

$62,357

$54,881

13.6%

EPS

$1.46

$1.29

$1.17

10.3%

Diluted Shares

50,870

49,667

2.4%

* GAAP revenue from continuing operations. Including discontinued, FY 2006 = $503,734 and FY 2005 = $483,397.
** GAAP net profit. Not including discontinued, FY 2006 = $48,079 or $1.29 EPS and Q4 2005 = $42,808 or $1.17 EPS.

Get back to basics with a look at the income statement.

Margin Checkup

FY 2006

FY 2005

Change*

Gross Margin

74.2%

74.35%

(0.14)

Operating Margin

25.74%

25.97%

(0.23)

Net Margin **

23.24%

21.8%

1.44

* Expressed in percentage points.
** Including discontinued operations.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

Q4 2006

Q4 2005

Change

Cash + ST Invest.

$200,954

$112,894

78%

Accounts Rec.

$58,199

$57,218

1.7%

Inventory

$35,219

$35,041

0.5%


Liabilities

Q4 2006

Q4 2005

Change

Long Term Debt*

$164,000

$150,970

8.6%

* Bank borrowings and convertible subordinated notes

Learn the ways of the balance sheet.

Cash Flow Highlights

No cash flow data provided. Boo!

Find out why Fools always follow the money.

Related Companies:

  • Medicis Pharmaceutical (NYSE:MRX)
  • Inamed, a subsidiary of Allergan (NASDAQ:AGN)
  • Johnson & Johnson (NYSE:JNJ)

Related Foolishness:

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Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.

At the time of publication, Jim Mueller had positions in Johnson & Johnson. Fool rules are here.