For
quarter ended: June 30, 2007
|
Commission
File No. 0-11178
|
UTAH
|
87-0342734
|
(State
or other jurisdiction of
incorporation
or organization)
|
(I.R.S.
Employer
Identification
No.)
|
Large
accelerated filer o
|
Accelerated
filer x
|
Non-accelerated
filer o
|
PART
I - FINANCIAL INFORMATION
|
PAGE
|
|
Item
1.
|
Financial
Statements
|
|
Consolidated
Condensed Balance Sheets as of June 30, 2007 and December 31,
2006
|
1
|
|
Consolidated
Condensed Statements of Income for the three and six months ended
June 30,
2007 and June 30, 2006
|
2
|
|
Consolidated
Condensed Statements of Cash Flows for the six months ended June
30, 2007
and June 30, 2006
|
3
|
|
Notes
to Consolidated Condensed Financial Statements
|
4
|
|
Item
2.
|
Management’s
Discussion and Analysis of Financial
Condition and Results of Operations
|
6
|
|
|
|
Item
3.
|
Quantitative
and Qualitative Disclosures about Market Risk
|
11
|
Item
4.
|
Controls
and Procedures
|
11
|
PART
II – OTHER INFORMATION
|
||
Item
1A.
|
Risk
Factors
|
12
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds
|
12
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
13
|
Item
6.
|
Exhibits
|
13
|
SIGNATURES
|
13
|
(unaudited)
|
(audited)
|
|||||||
ASSETS
|
JUNE
30,
2007
|
DECEMBER
31,
2006
|
||||||
Current
assets:
|
||||||||
Cash
|
$ |
608
|
$ |
610
|
||||
Investments,
available-for-sale
|
20,474
|
20,439
|
||||||
Accounts
& other receivables, net
|
4,124
|
3,746
|
||||||
Inventories
|
3,231
|
3,037
|
||||||
Other
current assets
|
658
|
579
|
||||||
Total
current assets
|
29,095
|
28,411
|
||||||
Property
and equipment, net
|
8,317
|
8,331
|
||||||
Goodwill
|
7,191
|
7,191
|
||||||
Other
intangible assets
|
2,614
|
2,588
|
||||||
Other
intangible assets - accumulated amortization
|
(2,358 | ) | (2,334 | ) | ||||
Other
intangible assets, net
|
256
|
254
|
||||||
TOTAL
|
$ |
44,859
|
$ |
44,187
|
||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
Current
liabilities:
|
||||||||
Accounts
payable
|
$ |
557
|
$ |
599
|
||||
Accrued
expenses
|
2,258
|
2,341
|
||||||
Current
portion of note payable
|
440
|
441
|
||||||
Total
current liabilities
|
3,255
|
3,381
|
||||||
Note
payable
|
4,041
|
4,383
|
||||||
Deferred
income taxes
|
314
|
308
|
||||||
Total
liabilities
|
7,610
|
8,072
|
||||||
Stockholders'
equity:
|
||||||||
Preferred
stock - $.01 par value; authorized - 5,000 shares; no shares issued
or
outstanding
|
||||||||
Common
stock - $.01 par value; authorized - 50,000 shares; issued - June
30,
2007, 3,924 shares and December 31, 2006, 3,944 shares
|
39
|
39
|
||||||
Accumulated
other comprehensive income
|
(716 | ) | (720 | ) | ||||
Retained
earnings
|
37,926
|
36,796
|
||||||
Total
stockholders' equity
|
37,249
|
36,115
|
||||||
TOTAL
|
$ |
44,859
|
$ |
44,187
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
June
30,
|
June
30,
|
|||||||||||||||
2007
|
2006
|
2007
|
2006
|
|||||||||||||
Sales,
net
|
$ |
7,211
|
$ |
7,293
|
$ |
14,329
|
$ |
14,396
|
||||||||
Cost
of goods sold
|
3,205
|
3,216
|
6,387
|
6,312
|
||||||||||||
Gross
margin
|
4,005
|
4,077
|
7,942
|
8,084
|
||||||||||||
Operating
expense
|
||||||||||||||||
Selling,
general and administrative
|
1,179
|
1,267
|
2,329
|
2,574
|
||||||||||||
Research
& development
|
109
|
215
|
205
|
283
|
||||||||||||
Total
|
1,288
|
1,482
|
2,534
|
2,857
|
||||||||||||
Income
from operations
|
2,717
|
2,595
|
5,408
|
5,227
|
||||||||||||
Other
income
|
314
|
571
|
615
|
985
|
||||||||||||
Income
before provision for income taxes
|
3,031
|
3,166
|
6,022
|
6,212
|
||||||||||||
Provision
for income taxes
|
1,046
|
1,107
|
2,093
|
2,118
|
||||||||||||
Net
income
|
$ |
1,985
|
$ |
2,059
|
$ |
3,929
|
$ |
4,094
|
||||||||
Earnings
per common shares (basic)
|
$ |
0.50
|
$ |
0.52
|
$ |
1.00
|
$ |
1.04
|
||||||||
Earnings
per common share (diluted)
|
$ |
0.50
|
$ |
0.51
|
$ |
0.98
|
$ |
1.01
|
||||||||
Shares
outstanding - basic
|
3,935
|
3,946
|
3,938
|
3,949
|
||||||||||||
Shares
outstanding - diluted
|
3,995
|
4,043
|
4,004
|
4,056
|
June
30,
|
||||||||
2007
|
2006
|
|||||||
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
Net
income
|
$ |
3,929
|
$ |
4,094
|
||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||
Depreciation
and amortization
|
301
|
444
|
||||||
Gain
on investments
|
(511 | ) | (885 | ) | ||||
Provision
for (recovery of) losses on accounts receivable
|
0
|
4
|
||||||
Deferred
income taxes
|
-
|
(15 | ) | |||||
Stock-based
compensation expense
|
44
|
76
|
||||||
Tax
benefit attributable to exercise of stock options
|
34
|
2,155
|
||||||
Changes
in operating assets and liabilities:
|
||||||||
Accounts
receivable - trade
|
(442 | ) | (110 | ) | ||||
Accrued
interest and other receivables
|
77
|
676
|
||||||
Inventories
|
(235 | ) | (231 | ) | ||||
Prepaid
expenses and other current assets
|
(79 | ) | (69 | ) | ||||
Accounts
payable
|
(43 | ) |
217
|
|||||
Accrued
expenses
|
(87 | ) | (436 | ) | ||||
Total
adjustments
|
(941 | ) |
1,826
|
|||||
Net
cash provided by operating activities
|
2,988
|
5,920
|
||||||
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
Capital
expenditures for:
|
||||||||
Property
and equipment
|
(152 | ) | (210 | ) | ||||
Intangible
assets
|
(10 | ) |
-
|
|||||
Purchases
of investments
|
(800 | ) | (3,900 | ) | ||||
Proceeds
from sale of investments
|
1,240
|
3,590
|
||||||
Net
cash (used in) provided by investing activities
|
278
|
(520 | ) | |||||
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
Proceeds
from issuance of common stock - options
|
125
|
444
|
||||||
Common
stock purchased and retired
|
(1,240 | ) | (1,590 | ) | ||||
Common
stock purchased and retired - options
|
-
|
(2,488 | ) | |||||
Repayments
of note payable
|
(452 | ) | (403 | ) | ||||
Payment
of dividends
|
(1,697 | ) | (1,368 | ) | ||||
Net
cash used in financing activities
|
(3,264 | ) | (5,405 | ) | ||||
Effect
of exchange rate changes on cash
|
(4 | ) | (8 | ) | ||||
NET
DECREASE IN CASH
|
(2 | ) | (13 | ) | ||||
CASH
AT BEGINNING OF PERIOD
|
610
|
703
|
||||||
CASH
AT END OF PERIOD
|
$ |
608
|
$ |
690
|
||||
SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION:
|
||||||||
Cash
paid during the period for income taxes
|
$ |
1,852
|
$ |
136
|
||||
Cash
paid during the period for interest
|
135
|
125
|
June
30,
|
December
31,
|
|||||||
2007
|
2006
|
|||||||
Finished
goods
|
$ |
1,007
|
$ |
1,002
|
||||
Work-in-process
|
945
|
984
|
||||||
Raw
materials
|
1,279
|
1,051
|
||||||
Total
|
$ |
3,231
|
$ |
3,037
|
Beginning
Balance, April 1, 2007
|
$ |
60
|
||
Changes
in Warranty Reserve during 2Q 2007:
|
||||
Aggregate
reductions for warranty repairs
|
(20 | ) | ||
Aggregate
changes for warranties issued during reporting period
|
-
|
|||
Aggregate
changes in reserve related to preexisting warranties
|
-
|
|||
Ending
Balance, June 30, 2007
|
$ |
40
|
2Q
2007
|
2Q
2006
|
|||||||
Balance,
beginning of period
|
$ |
-
|
$ |
108
|
||||
Reversal
of unrealized gain from securities included in beginning balance,
realized
in the period
|
-
|
(163 | ) | |||||
Unrealized
holding gains (losses), in equity securities
|
-
|
(42 | ) | |||||
Deferred
income taxes on unrealized holding gain (loss)
|
-
|
80
|
||||||
Balance,
end of period
|
$ |
-
|
$ | (17 | ) |
2Q
07
|
2Q
06
|
||
Gross
Profit Margin:
|
55.5%
|
55.9%
|
|
Operating
Profit Margin:
|
37.7%
|
35.6%
|
|
Net
Income Margin:
|
27.5%
|
28.2%
|
1H
07
|
1H
06
|
||
Gross
Profit Margin:
|
55.4%
|
56.2%
|
|
Operating
Profit Margin:
|
37.7%
|
36.3%
|
|
Net
Income Margin:
|
27.4%
|
28.4%
|
2Q
2007
|
2Q
2006
|
1H
2007
|
1H
2006
|
|||||||||||||
Obstetrics
|
$ |
2,044
|
$ |
2,359
|
$ |
4,304
|
$ |
4,769
|
||||||||
Gynecology/
Electrosurgery/ Urology
|
1,563
|
1,565
|
3,125
|
2,994
|
||||||||||||
Neonatal
|
1,748
|
1,715
|
3,491
|
3,484
|
||||||||||||
Blood
Pressure Monitoring and Accessories*
|
1,856
|
1,654
|
3,409
|
3,149
|
||||||||||||
Total:
|
$ |
7,211
|
$ |
7,293
|
$ |
14,329
|
$ |
14,396
|
||||||||
*includes
molded components sold to OEM
customers.
|
2Q
2007
|
2Q
2006
|
1H
2007
|
1H
2006
|
|||||||||||||
Obstetrics
|
$ |
175
|
$ |
259
|
$ |
467
|
$ |
461
|
||||||||
Gynecology/
Electrosurgery/ Urology
|
545
|
552
|
1,002
|
951
|
||||||||||||
Neonatal
|
142
|
120
|
325
|
289
|
||||||||||||
Blood
Pressure Monitoring and Accessories*
|
1,374
|
1,130
|
2,520
|
2,095
|
||||||||||||
Total:
|
$ |
2,236
|
$ |
2,061
|
$ |
4,314
|
$ |
3,799
|
||||||||
*includes
molded components sold to OEM
customers.
|
2Q
2007
|
2Q
2006
|
1H
2007
|
1H
2006
|
|||||||||||||
S&M
Expense
|
$ |
540
|
$ |
616
|
$ |
1,026
|
$ |
1,206
|
||||||||
R&D
Expense
|
109
|
215
|
205
|
283
|
||||||||||||
G&A
Expense
|
639
|
651
|
1,303
|
1,368
|
||||||||||||
Total
Operating Expenses:
|
$ |
1,288
|
$ |
1,482
|
$ |
2,534
|
$ |
2,857
|
2Q
2007
|
2Q
2006
|
1H
2007
|
1H
2006
|
|||||||||||||
Earnings
Per Share (EPS)
|
$ |
.497
|
$ |
.509
|
$ |
.981
|
$ |
1.010
|
||||||||
Shares
(000), Diluted
|
3,995
|
4,043
|
4,004
|
4,056
|
Period
|
Total
Number
of
Shares
Purchased
(1)
|
Average
Price
Paid
per
Share
|
Total
Number of Shares Purchased as Part of Publicly Announced Plans
or
Programs
(1)
|
Maximum
Number (or Approximate Dollar Value) of Shares that May be Purchased
Under
the Plans or
Programs
(1)
|
||||
4/01/07
- 4/30/07
|
1,899
|
$ 32.52
|
1,899
|
|||||
5/01/07
- 5/31/07
|
14,400
|
30.39
|
14,400
|
|||||
6/01/07
- 6/30/07
|
7,520
|
30.27
|
7,520
|
|||||
Total
|
23,819
|
$ 30.50
|
23,819
|
Exhibit
#
|
SEC
Reference #
|
Title
of Document
|
||
1
|
31
|
Certification
of CEO pursuant to Rule 13a-14(a) as adopted pursuant to Section
302 of
the Sarbanes-Oxley Act of 2002
|
||
2
|
31
|
Certification
of Principal Financial Officer pursuant to Rule 13a-14(a) as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002
|
||
3
|
32
|
Certification
of CEO pursuant to 18 U.S.C. §1350, as Adopted Pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002
|
||
4
|
32
|
Certification
of Principal Financial Officer pursuant to 18 U.S.C. §1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of
2002
|
UTAH
MEDICAL PRODUCTS, INC.
|
||
REGISTRANT
|
||
Date:
8/7/07
|
By:
|
/s/
Kevin L. Cornwell
|
Kevin
L. Cornwell
|
||
CEO
|
||
Date:
8/7/07
|
By:
|
/s/ Paul O. Richins
|
Paul
O. Richins
|
||
Principal
Financial Officer
|