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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) January 25, 2006
ALIGN TECHNOLOGY, INC.
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(Exact Name of Registrant as Specified in Its Charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
0-32259 94-3267295
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(Commission File Number) (IRS Employer Identification No.)
881 Martin Avenue, Santa Clara, California 95050
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(Address of Principal Executive Offices) (Zip Code)
(408) 470-1000
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(Registrant's Telephone Number, Including Area Code)
Not applicable
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On January 25, 2006, Align Technology, Inc. ("Align") is issuing a press
release and holding a conference call regarding its financial results for its
fourth quarter and full fiscal year ended December 31, 2005. The full text of
the press release is furnished as Exhibit 99.1 to this Form 8-K.
This information shall not be deemed "filed" for purposes of Section 18
of the Securities and Exchange Act of 1934, as amended (the "Exchange Act"), or
incorporated by reference in any filing under the Securities Act of 1933, as
amended, or the Exchange Act, except as shall be expressly set forth by specific
reference in such a filing.
Align is making reference to non-GAAP financial information in both the
press release and the conference call. A reconciliation of non-GAAP financial
measures contained in the attached press release to the comparable GAAP
financial measures is contained in the attached press release and a
reconciliation of these and certain other non-GAAP financial information
provided on the conference call is contained on the Investor Relations section
of our website at investor.aligntech.com.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(d) EXHIBITS.
EXHIBIT NO. DESCRIPTION
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99.1 Press Release of Align Technology, Inc. dated January 25, 2006
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: January 25, 2006 ALIGN TECHNOLOGY, INC.
By: /s/ Eldon M. Bullington
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Eldon M. Bullington
Vice President of Finance
and Chief Financial Officer
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
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99.1 Press Release of Align Technology, Inc. dated January 25, 2006
Exhibit 99.1
ALIGN TECHNOLOGY, INC. REPORTS REVENUES OF $51.2M
FOR Q4 2005 AND $207.1M FOR FISCAL YEAR 2005
SANTA CLARA, Calif., Jan. 25 /PRNewswire-FirstCall/ -- Align Technology,
Inc. (Nasdaq: ALGN), the inventor of Invisalign(R), a proprietary method of
straightening teeth without wires and brackets, today reported financial results
for the fourth quarter and full year of 2005. Total revenues for the fourth
quarter of 2005 were $51.2 million, compared to $50.9 million in the third
quarter of 2005, an increase of 0.6 percent, and $43.7 million in the fourth
quarter of 2004, an increase of 17.2 percent. For fiscal year 2005, Align
reported revenues of $207.1 million, compared to $172.8 million for fiscal year
2004, an increase of 19.8 percent.
"We are pleased with our results for 2005," stated Thomas M. Prescott,
Align Technology's President and CEO. "Revenues were up 20 percent and case
volumes grew by 23 percent. We continued to provide value for our customers
through our national advertising campaign, new products and software, superb
clinical education events, and new pricing initiatives. In 2006, we will
continue our strategy of ensuring product leadership, being responsive to our
customers' needs, and improving operational effectiveness across the company.
Delivering on this strategy, combined with our superior value proposition for
customers, will enhance shareholder value."
The net profit for the fourth quarter of 2005, as reported on a GAAP basis,
was $528 thousand, or earnings per share (EPS) of $0.01. This compares to GAAP
net profit of $1.1 million for the fourth quarter of 2004, or EPS of $0.02 per
share. For comparison purposes, this also compares to a non-GAAP net profit of
$1.3 million for the fourth quarter of 2004 or non-GAAP EPS of $0.02. Non-GAAP
net profit excludes the effects of stock-based compensation.
For fiscal year 2005, the net profit was $1.4 million, or EPS of $0.02.
This compares to a GAAP net profit of $8.8 million for fiscal year 2004, or EPS
of $0.14 per share. For comparison purposes, this also compares to a non-GAAP
net profit of $14.4 million for fiscal year 2004, or EPS of $0.22. The
reconciliation of the GAAP to non-GAAP measurements for net profit and EPS is
set forth below within Align Technology's financial statements.
As of December 31, 2005, Align had $74.4 million in cash, cash equivalents,
and marketable securities, compared to $70.0 million as of December 31, 2004.
Align Webcast and Conference Call
Align Technology will host a webcast and conference call today, January 25,
2006 at 10:00 a.m. EST, 7:00 a.m. PST, to review the fourth quarter and fiscal
year 2005 results and discuss future operating trends and guidance. To access
the webcast, click on "Webcasts & Presentations" on Align Technology's Investor
Relations web site at http://investor.aligntech.com . To access the conference
call, please dial 201-689-8341 approximately fifteen minutes prior to the start
of the call. If you are unable to listen to the call, an archived web cast will
be available beginning approximately one hour after the call's conclusion and
will remain available through 5:30 p.m. EST on January 24, 2007. Additionally, a
telephonic replay of the call can be accessed by dialing 877-660-6853 with
account number 292 followed by # and conference number 151235 followed by #. The
replay may be accessed from international locations by dialing 201-612-7415 and
using the same account and conference numbers referenced above. The telephonic
replay will be available through 5:30 p.m. EST on January 31, 2006.
About Align Technology, Inc.
Align Technology designs, manufactures and markets Invisalign, a
proprietary method for treating malocclusion, or the misalignment of teeth.
Invisalign corrects malocclusion using a series of clear, nearly invisible,
removable appliances that gently move teeth to a desired final position. Because
it does not rely on the use of metal or ceramic brackets and wires, Invisalign
significantly reduces the aesthetic and other limitations associated with
braces. Invisalign is appropriate for treating adults and older teens. Align
Technology was founded in March 1997 and received FDA clearance to market
Invisalign in 1998.
To learn more about Invisalign or to find a certified Invisalign doctor in
your area, please visit www.invisalign.com or call 1-800-INVISIBLE.
Forward-Looking Statements
This news release contains forward-looking statements, including statements
regarding Align's statement that it will continue to execute its strategy of
ensuring product leadership, responsiveness to customer needs and producing high
quality products and that delivering on this strategy will enhance shareholder
value. Forward-looking statements contained in this news release relating to
expectations about future events or results are based upon information available
to Align as of the date hereof. Readers are cautioned that these forward-looking
statements are only predictions and are subject to risks, uncertainties and
assumptions that are difficult to predict. As a result, actual results may
differ materially and adversely from those expressed in any forward-looking
statement. Factors that might cause such a difference include, but are not
limited to, risks relating to Align's ability to sustain or increase
profitability or revenue growth in future periods while controlling expenses,
customer demand for Invisalign, acceptance of Invisalign by consumers and dental
professionals, Align's third party manufacturing processes and personnel,
foreign operational, political and other risks relating to Align's international
manufacturing operations, Align's ability to protect its intellectual property
rights, competition from manufacturers of traditional braces and new
competitors, such as OrthoClear, Align's ability to develop and successfully
introduce new products, and the loss of key personnel, including members of its
direct sales force. These and other risks are detailed from time to time in
Align's periodic reports filed with the Securities and Exchange Commission,
including, but not limited to, its Annual Report on Form 10-K for the fiscal
year ended December 31, 2004, which was filed with the Securities and Exchange
Commission on March 9, 2005, and its Quarterly Reports on Form 10-Q. Align
undertakes no obligation to revise or update publicly any forward-looking
statements for any reason.
Investor Relations Contact: Press Contact:
Barbara Domingo Shannon Henderson
Align Technology, Inc. Ethos Communications, Inc.
408-470-1000 678-417-1767
investorinfo@aligntech.com shannon@ethoscommunication.com
ALIGN TECHNOLOGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Three Months Ended Year Ended
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Dec. 31, Dec. 31, Dec. 31, Dec. 31,
(in thousands, except per share data) 2005 2004 2005 2004
- -------------------------------------- ------------ ------------ ------------ ------------
Revenues $ 51,164 $ 43,655 $ 207,125 $ 172,830
Cost of revenues 16,711 14,961 63,784 57,526
Gross profit 34,453 28,694 143,341 115,304
Operating expenses:
Sales and marketing 18,570 15,377 80,068 55,932
General and administrative 11,293 8,655 42,242 33,851
Research and development 3,927 4,006 18,585 15,756
Total operating expenses 33,790 28,038 140,895 105,539
Profit from operations 663 656 2,446 9,765
Interest and other income
(expense), net 255 616 283 (3)
Provision for income taxes (390) (151) (1,316) (994)
Net profit $ 528 $ 1,121 $ 1,413 $ 8,768
Net profit per share
- basic $ 0.01 $ 0.02 $ 0.02 $ 0.15
- diluted $ 0.01 $ 0.02 $ 0.02 $ 0.14
Shares used in computing
net profit per share
- basic 62,045 60,744 61,644 59,963
- diluted 63,247 63,560 63,152 64,089
ALIGN TECHNOLOGY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
December 31, December 31,
(in thousands) 2005 2004
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ASSETS
Current assets:
Cash and cash equivalents $ 74,219 $ 69,659
Restricted cash 150 303
Accounts receivable, net 29,305 28,809
Inventories, net 2,930 2,852
Other current assets 4,982 5,211
Total current assets 111,586 106,834
Property and equipment, net 26,427 21,702
Other long-term assets 4,097 2,176
Total assets $ 142,110 $ 130,712
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 2,489 $ 3,361
Accrued liabilities 29,372 23,481
Deferred revenue 16,747 16,257
Debt obligations, current portion -- 1,849
Total current liabilities 48,608 44,948
Other long term liabilities 64 25
Total liabilities 48,672 44,973
Total stockholders' equity 93,438 85,739
Total liabilities and
stockholders' equity $ 142,110 $ 130,712
ALIGN TECHNOLOGY, INC.
NON-GAAP CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Use of Non-GAAP Financial Information
To supplement our condensed consolidated financial statements presented on a
GAAP basis, Align uses a non-GAAP measure of net profit, which is adjusted to
exclude certain costs and expenses and any associated tax effects of such
adjustments. We believe that our non-GAAP net profit gives an indication of our
baseline performance before other charges that are considered by management to
be outside of our core operating results. In addition, our non-GAAP net profit
is among the primary indicators management uses as a basis for our planning and
forecasting of future periods. The presentation of this additional information
should not be considered in isolation or as a substitute for net profit prepared
in accordance with generally accepted accounting principles in the United States
of America.
Three Months Ended Year Ended
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Dec. 31, Dec. 31, Dec. 31, Dec. 31,
(in thousands, except per share data) 2005 2004 2005 2004
- -------------------------------------- ------------ ------------ ------------ ------------
Revenues $ 51,164 $ 43,655 $ 207,125 $ 172,830
Cost of revenues 16,711 14,922 63,784 56,632
Gross profit 34,453 28,733 143,341 116,198
Operating expenses:
Sales and marketing 18,570 15,361 80,062 55,281
General and administrative 11,293 8,527 42,236 31,115
Research and development 3,927 3,975 18,585 14,423
Total operating expenses 33,790 27,863 140,883 100,819
Profit from operations 663 870 2,458 15,379
Interest and other income
(expense), net 255 616 283 (3)
Provision for income taxes (390) (151) (1,316) (994)
Net profit $ 528 $ 1,335 $ 1,425 $ 14,382
Net profit per share
- basic $ 0.01 $ 0.02 $ 0.02 $ 0.24
- diluted $ 0.01 $ 0.02 $ 0.02 $ 0.22
Shares used in computing net profit
per share
- basic 62,045 60,744 61,644 59,963
- diluted 63,247 63,560 63,152 64,089
ALIGN TECHNOLOGY, INC.
RECONCILIATION OF GAAP NET PROFIT TO ADJUSTED NON-GAAP NET PROFIT
(unaudited)
Three Months Ended Year Ended
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Dec. 31, Dec. 31, Dec. 31, Dec. 31,
(in thousands) 2005 2004 2005 2004
- -------------------------------------- ------------ ------------ ------------ ------------
Calculation of non-GAAP net profit
excluding special items:
Net profit $ 528 $ 1,121 $ 1,413 $ 8,768
Items:
Stock-based compensation
expense included in: (1)
- cost of revenues -- 39 -- 894
- sales and marketing -- 16 6 651
- general and administrative -- 128 6 2,736
- research and development -- 31 -- 1,333
Non-GAAP net profit excluding
special items $ 528 $ 1,335 $ 1,425 $ 14,382
(1) Stock-based compensation expense represents the amortization of deferred
stock-based compensation recorded in connection with the granting of stock
options to employees and non-employees.
SOURCE Align Technology, Inc.
-0- 01/25/2006
/CONTACT: investors, Barbara Domingo of Align Technology, Inc.,
+1-408-470-1000, or investorinfo@aligntech.com; or media, Shannon Henderson of
Ethos Communications, Inc., +1-678-417-1767, or shannon@ethoscommunication.com,
for Align Technology, Inc./
/FCMN Contact: bdomingo@aligntech.com/
/Web site: http://www.invisalign.com /