Volcano's profit plummets despite record Q4 revenue
Volcano ($VOLC) posted best-ever revenue of $102.5 million in the fourth quarter, but a spike in operating expenses and debt costs pulled net income down about 91% over the previous year.
The company reported Q4 profits of $2.5 million, down from $29.4 million in 2011, but CEO Scott Huennekens said the quarter's 10% revenue growth is a sign Volcano is moving in the right direction. Fractional flow reserve devices, used in coronary procedures, grew 45% on the quarter, and Volcano plans to translate that success to its other units, Huennekens said.
"At the same time, we continued to position the company for long-term growth by targeting addressable markets that are double the size of those we address today through the growth of our base business, development of our pipeline and implementation of business expansion strategies," Huennekens said in a statement.
Volcano is expecting 2013 revenue to clock in about 7% higher than 2012, expecting between $406 million and $412 million on the year. Driving that growth are Volcano's two Q4 acquisitions: Inferior vena cava filter company Crux Biomedical, purchased in December for $36 million, and software maker Sync-Rx, bought for $17.3 million in November.
Those deals are all part of Volcano's diversification strategy, Huennekens said, and the company wants to move beyond intravascular imaging and focus on diagnostic and therapeutic devices for coronary and other applications.