You've got to love a company with a CEO who says, "There's still a lot of work to be done," in an earnings conference call where year-over-year revenue grew 24%. Talk about not resting on your laurels.
It wasn't just hand-held ultrasound maker SonoSite's
Gross margins continued to slip as the company sells a larger numbers of units to international distributors at a discount. But international sales have fewer marketing costs, so the company was able to lower sales, general and administrative (SG&A) expenses by 300 basis points.
That increased efficiency is pretty impressive given the increased legal costs that SonoSite is incurring as it gears up for two patent litigation cases -- with Zonare Medical Systems and General Electric
SonoSite is guiding revenue growth of at least 15% for next year, which shouldn't be too tough given its launch of five new products this month. The company is trying to expand the market by offering a wide variety of price points for hospitals as well as doctors' offices. It's moving away from the Swiss Army style machine to more specialized machines for specific applications. Four of the five instruments it launched are of this style, although they're all based on the same platform using Texas Instruments'
Management hinted that they're interested in making an acquisition, but didn't give much other information. They certainly need to find something to do with the $309 million in cash and investments the company has on the books. The cash flow machine is going to continue to churn for many quarters to come.
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