UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (date of earliest event reported): December 18, 2002
Commission File No. 0-11178
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UTAH MEDICAL PRODUCTS, INC.
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(Exact name of Registrant as specified in its charter)
UTAH 87-0342734
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
7043 South 300 West
Midvale, Utah 84047
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Address of principal executive offices
Registrant's telephone number: (801) 566-1200
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ITEM 5. OTHER EVENTS
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On December 18, 2002 the Company announced, by press release, the
following:
Salt Lake City, Utah - Because of lack of independent investment research
coverage, Utah Medical Products, Inc. (Nasdaq:UTMD) projects its best estimate
of earnings per share (eps) for the nearly completed calendar year 2002 which
includes an estimate for current fourth quarter (4Q) results, and year 2003
looking forward. The projections indicate UTMD's fifth and sixth consecutive
years of achieving cumulative average annual growth in eps exceeding 20% per
year. 1997 eps were $.509.
Calendar Year: 1998 1999 2000 2001 2002 2003
Actual Actual Actual Actual Projected Projected
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Diluted EPS: $ .587 $ .760 $ .899 $1.139 $1.35 $1.55
EPS growth over prior year: +15.4% +29.4% +18.3% +26.7% +19% +15%
If UTMD achieves its estimate for 4Q 2002, it will substantially exceed its
calendar year 2002 profit and eps projections made in a similar press release a
year ago. In December 2001, UTMD projected 12% net profit increase, yielding
$1.26 eps in 2002. The better result in 2002 has occurred because UTMD has
benefited from improved gross profit margins, lower than expected operating
expenses, higher net non-operating income because of lower interest rates and
faster than expected debt reduction, and a lower income tax rate, combining to
result in a projected 13% increase in operating profits, 21% increase in net
income and 19% increase in eps with total sales 2% higher than 2001.
UTMD's 2003 projections assume a continued competitive market environment with
about a 5% increase in sales activity for the year as a whole, representing the
best top line increase for UTMD since 1999. In addition to continued operating
improvements expected to increase profit margins, UTMD's 2003 eps will benefit
from the recent tender offer in which the Company repurchased 10% of its
outstanding shares. However, the interest on the debt associated with financing
the tender offer will be a drag on 2003 eps. UTMD believes it will eliminate the
debt associated with the tender offer, currently at a balance of $5.4 million,
before the end of 2003. In order to achieve the 15% increase in projected 2003
eps, UTMD may need to complete an accretive acquisition, successfully launch new
products currently in development or continue to repurchase additional shares in
the open market. In past years, UTMD has been able to achieve all three of those
possibilities, and is optimistic about its ability to accomplish one or more of
them again in 2003.
"The Company and its employees are gratified with the recognition of UTMD's
value during a difficult time for the stock market. If its share price remains
at today's $17.80 value on December 31, UTMD's return to its shareholders, in
the form of appreciated stock value, has been +38% per
year for the last three calendar years. During the same three year period, the
Dow Jones Industrials Index has declined 8% per year, the S&P 500 Index has
declined 14% per year, and the NASDAQ Index has declined 29% per year," states
CEO Kevin Cornwell. "Still, UTMD's stock is currently being traded at a
substantial discount to average market valuation multiples for the medical
device industry. Not included in our 2003 eps projection is UTMD's prospective
income from receipt of damages adjudicated against Tyco International for
literal infringement of one of UTMD's patents, since the judgment is under
appeal. However, we do expect the appeal to be concluded before the end of 2003.
Since Tyco produced a $28 million bond at the order of the U.S. Federal District
Court, the receipt of damages, if the judgment is upheld, is not subject to any
risk of Tyco illiquidity at this point."
Investors are cautioned that this press release contains forward looking
statements and that actual results may differ from those projected. Risks
factors that could cause results to differ materially from those projected
include market acceptance of new and/or competitive products, timing of
regulatory approval of new products, UTMD's ability to efficiently manufacture,
market, and sell its products, among other factors that have been outlined in
UTMD's public disclosure filings with the SEC. The 10-K for year 2002 will be
filed with the SEC by March 31, 2003 and will be available for direct access on
the Internet for shareholders by linking through UTMD's website www.utahmed.com.
The 2002 Annual Report to shareholders will be mailed about April 1, 2003.
Utah Medical Products, Inc., with particular interest in healthcare for women
and their babies, develops, manufactures, assembles and markets a broad range of
disposable and reusable specialty medical devices designed for better health
outcomes for patients and their care-providers.
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SIGNATURES
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Pursuant to the requirements of the Securities Exchanges Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
UTAH MEDICAL PRODUCTS, INC.
REGISTRANT
Date: 12/18/02 By: \s\ Kevin L. Cornwell
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Kevin L. Cornwell
CEO