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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) July 26, 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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Digi Reports Fiscal 2003 Third Quarter Results - Page 2
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On July 26, 2006, Align Technology, Inc. ("Align") is issuing a press
release and holding a conference call regarding its financial results for its
second quarter ended June 30, 2006. 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
- ----------- -------------------------------------------------------------
99.1 Press Release, dated July 26, 2006 for Align Technology, Inc.
Digi Reports Fiscal 2003 Third Quarter Results - Page 3
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: July 26, 2006 ALIGN TECHNOLOGY, INC.
By: /s/ Eldon M. Bullington
------------------------------
Eldon M. Bullington
Vice President of Finance and
Chief Financial Officer
Digi Reports Fiscal 2003 Third Quarter Results - Page 4
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION
- ----------- -------------------------------------------------------------
99.1 Press Release, dated July 26, 2006 for Align Technology, Inc.
Exhibit 99.1
ALIGN TECHNOLOGY, INC. REPORTS Q2 2006 REVENUES OF $53.2 MILLION
SANTA CLARA, Calif., July 26 /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 second quarter of 2006. Total revenues for the second quarter of 2006
were $53.2 million, compared to $53.9 million in the second quarter of 2005, a
decrease of 1.3 percent.
"We are pleased with our steady progress and results in the second quarter
of 2006," stated Thomas M. Prescott, Align Technology's President and CEO. "We
continue to develop the Invisalign system, along with the technology and service
offerings that will allow us to become a greater part of our customers'
practices in the future."
The net loss for the second quarter of 2006, as reported on a GAAP basis,
was $2.6 million, or loss per share of $0.04. This compares to GAAP net profit
of $538 thousand for the second quarter of 2005, or EPS of $0.01.
The non-GAAP net loss for the second quarter of 2006 was $344 thousand, or
non-GAAP loss per share of $0.01. This compares to non-GAAP net profit of $538
thousand for the second quarter of 2005, or EPS of $0.01. The reconciliation of
the GAAP to non-GAAP measurements for net loss for the second quarter of 2006 is
set forth below within Align Technology's financial statements.
As of June 30, 2006, Align had $69.9 million in cash, cash equivalents,
marketable securities, and restricted cash, compared to $74.4 million as of
December 31, 2005.
Align Webcast and Conference Call
Align Technology will host a webcast and conference call today, July 26,
2006 at 8:45 a.m. EDT, 5:45 a.m. PDT, to review the second quarter of 2006
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. EDT on July 25, 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 199386 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. EDT on August 9, 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 April 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 Statement
This news release contains forward-looking statements, including statements
regarding Align's focus on developing the Invisalign system and the technology
and service offerings that Align expects will allow it to become a greater part
of its customers' practices. 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,
including expenses related to the OrthoClear litigation, 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, 2005, which was filed with the Securities and Exchange Commission on March
1, 2006, and its Quarterly Reports on Form 10-Q. Align undertakes no obligation
to revise or update publicly any forward-looking statements for any reason.
ALIGN TECHNOLOGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
Three Months Ended Six Months Ended
---------------------------- ----------------------------
June 30, June 30, June 30, June 30,
(in thousands, except per share data) 2006 2005 2006 2005
- ---------------------------------------- ------------ ------------ ------------ ------------
Revenues $ 53,221 $ 53,940 $ 102,129 $ 105,095
Cost of revenues 16,492 16,620 30,789 32,098
Gross profit 36,729 37,320 71,340 72,997
Operating expenses:
Sales and marketing 20,641 21,049 40,707 40,183
General and administrative 15,354 9,723 30,418 19,234
Research and development 4,025 5,355 8,719 10,258
Total operating expenses 40,020 36,127 79,844 69,675
Profit (Loss) from operations (3,291) 1,193 (8,504) 3,322
Interest and other income (expense), net 841 (238) 1,539 (298)
Provision for income taxes (160) (417) (409) (623)
Net profit (loss) $ (2,610) $ 538 $ (7,374) $ 2,401
Net profit (loss) per share
- basic $ (0.04) $ 0.01 $ (0.12) $ 0.04
- diluted $ (0.04) $ 0.01 $ (0.12) $ 0.04
Shares used in computing net profit
(loss) per share
- basic 62,966 61,484 62,743 61,367
- diluted 62,966 62,953 62,743 62,939
ALIGN TECHNOLOGY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
June 30, December 31,
(in thousands) 2006 2005
- ---------------------------------------- ------------ ------------
ASSETS
Current assets:
Cash and cash equivalents $ 57,486 $ 74,219
Restricted cash 159 150
Marketable securities, short-term 12,268 --
Accounts receivable, net 32,790 29,305
Inventories, net 2,733 2,930
Other current assets 6,487 4,982
Total current assets 111,923 111,586
Property and equipment, net 26,610 26,427
Other long-term assets 3,224 4,097
Total assets $ 141,757 $ 142,110
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 4,813 $ 2,489
Accrued liabilities 26,600 29,372
Deferred revenue 13,250 16,747
Total current liabilities 44,663 48,608
Other long term liabilities 379 64
Total liabilities 45,042 48,672
Total stockholders' equity 96,715 93,438
Total liabilities and
stockholders' equity $ 141,757 $ 142,110
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, we use non-GAAP measures of gross profit, profit (loss) from
operations, net profit (loss) and certain expenses (including sales and
marketing, general and administrative and research and development), which
exclude stock-based compensation to allow for a better comparison of results in
the current period to those in prior periods that did not include FAS 123(R)
stock-based compensation. We believe the non-GAAP measures that exclude
stock-based compensation enhance the comparability of results against prior
periods. In addition, we use these non-GAAP financial measures for internal
management purposes, when publicly providing our business outlook and as a means
to evaluate period-to-period comparisons. These non-GAAP financial measures
should be considered as a supplement to, and not as a substitute for, or
superior to, financial measures prepared in accordance with GAAP.
Three Months Ended Three Months Ended
June 30, 2006 June 30, 2005
-------------------------------------------- -------------------------------------------
(in thousands, except Adjust- Adjust-
per share data) Reported ments(a) Non GAAP Reported ments(a) Non GAAP
- ----------------------- ------------ ------------ ------------ ------------ ------------ ------------
Revenues $ 53,221 $ -- $ 53,221 $ 53,940 $ -- $ 53,940
Cost of revenues 16,492 (181) 16,311 16,620 -- 16,620
Gross profit 36,729 181 36,910 37,320 -- 37,320
Operating expenses:
Sales and marketing 20,641 (732) 19,909 21,049 -- 21,049
General and
administrative 15,354 (1,029) 14,325 9,723 -- 9,723
Research and
development 4,025 (324) 3,701 5,355 -- 5,355
Total operating
expenses 40,020 (2,085) 37,935 36,127 -- 36,127
Profit (Loss) from
operations (3,291) 2,266 (1,025) 1,193 -- 1,193
Interest and other
income (expense),
net 841 -- 841 (238) -- (238)
Provision for income
taxes (160) -- (160) (417) -- (417)
Net profit (loss) $ (2,610) $ 2,266 $ (344) $ 538 $ -- $ 538
Net profit (loss)
per share
- basic $ (0.04) $ (0.01) $ 0.01 $ 0.01
- diluted $ (0.04) $ (0.01) $ 0.01 $ 0.01
Shares used in
computing net
profit (loss) per
share
- basic 62,966 62,966 61,484 61,484
- diluted 62,966 62,966 62,953 62,953
(a) Non cash stock-based compensation included in cost of sales and
operating expenses.
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, we use non-GAAP measures of gross profit, profit (loss) from
operations, net profit (loss) and certain expenses (including sales and
marketing, general and administrative and research and development), which
exclude stock-based compensation to allow for a better comparison of results in
the current period to those in prior periods that did not include FAS 123(R)
stock-based compensation. We believe the non-GAAP measures that exclude
stock-based compensation enhance the comparability of results against prior
periods. In addition, we use these non-GAAP financial measures for internal
management purposes, when publicly providing our business outlook and as a means
to evaluate period-to-period comparisons. These non-GAAP financial measures
should be considered as a supplement to, and not as a substitute for, or
superior to, financial measures prepared in accordance with GAAP.
Six Months Ended Six Months Ended
June 30, 2006 June 30, 2005
-------------------------------------------- -------------------------------------------
(in thousands, except Adjust- Adjust-
per share data) Reported ments(a) Non GAAP Reported ments(a) Non GAAP
- ----------------------- ------------ ------------ ------------ ------------ ------------ ------------
Revenues $ 102,129 $ -- $ 102,129 $ 105,095 $ -- $ 105,095
Cost of revenues 30,789 (329) 30,460 32,098 -- 32,098
Gross profit 71,340 329 71,669 72,997 -- 72,997
Operating expenses:
Sales and marketing 40,707 (1,411) 39,296 40,183 (6) 40,177
General and
administrative 30,418 (2,117) 28,301 19,234 (6) 19,228
Research and
development 8,719 (614) 8,105 10,258 -- 10,258
Total operating
expenses 79,844 (4,142) 75,702 69,675 (12) 69,663
Profit (Loss) from
operations (8,504) 4,471 (4,033) 3,322 12 3,334
Interest and other
income (expense),
net 1,539 -- 1,539 (298) -- (298)
Provision for income
taxes (409) -- (409) (623) -- (623)
Net profit (loss) $ (7,374) $ 4,471 $ (2,903) $ 2,401 $ 12 $ 2,413
Net profit (loss)
per share
- basic $ (0.12) $ (0.05) $ 0.04 $ 0.04
- diluted $ (0.12) $ (0.05) $ 0.04 $ 0.04
Shares used in
computing net
profit(loss) per
share
- basic 62,743 62,743 61,367 61,367
- diluted 62,743 62,743 62,939 62,939
(a) Non cash stock-based compensation included in cost of sales and
operating expenses
ALIGN TECHNOLOGY, INC.
FACT SHEET
The following information highlights business metrics for Align's second quarter
of 2006. For prior quarter information, please refer to the Investor Relations
website at http://investor.aligntech.com.
(rounded to the nearest hundred, except in utilization)
Cases Delivered 2Q 2006
- -------------------------------------------- --------
U.S. Orthodontists - Full 10,400
U.S. Orthodontists - Invisalign
Express 3,700
U.S. GP dentists - Full 13,000
U.S. GP dentists - Invisalign Express 6,500
International - Full 4,800
International - Invisalign Express 200
Total Cases Delivered 38,700
Cumulative
Doctors Trained 2Q 2006 Total
- -------------------------------------------- -------- ------------
U.S. Orthodontists -- 7,900
U.S. GP dentists 1,000 19,900
International 300 10,200
Total Doctors Trained 1,300 38,000
Total Submitting Doctors 2Q 2006
- -------------------------------------------- --------
U.S. Orthodontists 2,900
U.S. GP dentists 7,800
International 1,800
Total Submitting Doctors 12,500
Doctor Utilization* 2Q 2006
- -------------------------------------------- --------
U.S. Orthodontists 4.95
U.S. GP dentists 2.58
International 2.86
* Doctor Utilization = # of cases / # of doctors cases are shipped to
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
SOURCE Align Technology, Inc.
-0- 07/26/2006
/CONTACT: Barbara Domingo, Investor Relations of Align Technology, Inc.,
+1-408-470-1000, or investorinfo@aligntech.com; or Shannon Henderson of Ethos
Communications, Inc., +1-678-417-1767, or shannon@ethoscommunication.com, for
Align Technology, Inc./
/Web site: http://www.invisalign.com/
(ALGN)