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)
May 13, 2008

 

IRIDEX CORPORATION

(Exact name of registrant as specified in its charter)

Delaware		0-27598		77-0210467
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

1212 Terra Bella Avenue
Mountain View, California 94043
(Address of principal executive offices, including zip code)

(650) 940-4700
(Registrant’s telephone number, including area code)

(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):

o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 2.02.		Results of Operations and Financial Condition.

On May 13, 2008, IRIDEX Corporation issued a press release discussing its financial results for the first quarter ended March 29, 2008. The press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

This information shall not be deemed “filed” for purposes of Section 18 of the Securities 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.

Item 9.01.		Financial Statements and Exhibits.

(d)

Exhibits

Exhibit No.				Description
	99.1			Press Release dated May 13, 2008.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: May 13, 2008

EXHIBIT INDEX

Exhibit No.				Description
	99.1			Press Release dated May 13, 2008.

Exhibit 99.1

FOR IMMEDIATE RELEASE		Contact:	Jim Mackaness
			Chief Financial Officer
			650 940-4700

May 13, 2008
Mountain View, California

IRIDEX Reports First Quarter 2008 Financial Results

     IRIDEX Corporation (Nasdaq: IRIX) today reported financial results for the first quarter of 2008 ended March 29, 2008.

     Revenue for the first quarter of 2008 was $11.5 million, an 8.7% decrease from the $12.6 million reported for the first quarter of 2007. The Company’s net loss was $0.9 million or $0.10 per diluted share for the first quarter of 2008 compared with a net loss of $4.9 million or $0.61 per diluted share in the first quarter of 2007. The prior year financial results do include the AMS/Laserscope aesthetics acquisition, which was completed on January 16, 2007.

     Ophthalmology revenues were $7.5 million in the first quarter of 2008 compared with $7.2 million in 2007, an increase of 4.8%. Domestic ophthalmology revenues increased 10.6% to $4.4 million. International ophthalmology revenues decreased 2.4% to $3.1 million. Ophthalmology recurring revenues, consisting of disposable products and service, represented 55.2% of our total ophthalmology revenues for the first 3 months in 2008 and 55.5% for the comparable period in 2007.

     Total aesthetics revenues were $3.9 million in the first quarter of 2008 compared with $5.4 million in the comparable period of 2007, a decrease of 26.8%. In the first quarter 2008 domestic aesthetics revenues decreased $1.2 million to $1.5 million and international aesthetics revenues decreased $0.3 million to $2.4 million.

     Gross profit for the first quarter of 2008 was $4.8 million, compared with $5.2 million for the first quarter of 2007. Gross margins were 41.9% and 41.5%, respectively. Operating expenses for the first quarter 2008 were $5.5 million compared with $10.0 million for 2007.

     Mr. Theodore A. Boutacoff, President and CEO stated, “Operationally we are progressing towards financial stability as demonstrated by the substantial reduction in our quarterly operating loss from $4.9 million to $0.9 million primarily due to reductions in operating expenses. During the first quarter we met our obligations with AMS by paying $1.7 million, leaving a balance related to the Settlement Agreement of $3.1 million which we plan to fully satisfy by the end of our third fiscal quarter. In addition, during the first quarter we successfully negotiated a new bank credit facility with Wells Fargo Bank that replaced our previously existing credit agreements. The new credit facility is an asset based revolving line that allows the Company to borrow up to $8 million.

     “We continue to be encouraged by our improving ophthalmology revenues. The decrease in our aesthetics revenues is primarily due to the difficulties incurred in the U.S. distribution channel during 2007, which are still being experienced, coupled with the overall softening of the U.S. aesthetics market. A focus in 2008 is to establish a productive US aesthetics sales channel.”

     Cash and cash equivalents were $4.0 million as of March 29, 2008 down from $5.8 million in December 29, 2007 (this does not include $3.8 million in restricted cash). Inventories remained constant at $16.0 million as of March 29, 2008 as compared to December 29, 2007. Accounts receivable were $8.4 million as of March 29, 2008, compared to $8.9 million as of December 29, 2007.

Conference Call

     IRIDEX management will conduct a conference call later today, Tuesday, May 13, 2008 at 5:00 p.m. Eastern Time. Interested parties may access the live conference call via telephone by dialing (800) 240-7305 (U.S.) or (303) 262-2130 (International), or by visiting the Company’s website at www.iridex.com. A telephone replay will be available beginning on Tuesday, May 13, 2008 through Tuesday, May 20, 2008 by dialing (800) 405-2236 (U.S.) or (303) 590-3000 (International) and entering Passcode 11114278#. In addition, later today an archived version of the webcast will be available on the Company’s website at www.iridex.com.

 About IRIDEX

     IRIDEX Corporation is a leading worldwide provider of therapeutic based laser systems, disposable laser probes and delivery devices to treat eye diseases in ophthalmology and skin disorders in the aesthetics market. IRIDEX products are sold in the United States through a direct sales force and internationally through a combination of a direct sales force and a network of approximately 100 independent distributors into 107 countries. For further information, visit the Company’s website at http://www.iridex.com.

Safe Harbor Statement

     This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Act of 1934, as amended, relating to the Company’s financial stability, growth strategy and prospects, ability to satisfy future financial obligations and continued improvement in our ophthalmology revenues. Please see a detailed description of these and other risks contained in our Annual Report on Form 10-K for the fiscal year ended December 29, 2007 and our Quarterly Report on Form 10-Q for the first quarter ended March 29, 2008 filed with the Securities and Exchange Commission. Forward-looking statements contained in this announcement are made as of this date and will not be updated.

IRIDEX Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(unaudited)

		Three Months Ended
		March 29,				March 31,
		2008				2007
Sales		$	11,474			$	12,566
Cost of sales			6,669				7,357
Gross profit			4,805				5,209
Operating expenses:
Research and development			1,025				1,729
Sales, general and administrative			4,518				8,274
Total operating expenses			5,543				10,003
Loss from operations			(738	)			(4,794	)
Interest and other (expense) income, net			(154	)			(126	)
Loss before income taxes			(892	)			(4,920	)
Provision for income taxes			—				—
Net loss		$	(892	)		$	(4,920	)
Net loss per common share — basic		$	(0.10	)		$	(0.61	)
Net loss per common share — diluted		$	(0.10	)		$	(0.61	)
Shares used in per common share basic calculations			8,824				8,080
Shares used in per common share diluted calculations			8,824				8,080

IRIDEX Corporation
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)

		March 29,				December 29,
		2008				2007
		(unaudited)
Assets
Current Assets:
Cash and cash equivalents		$	4,013			$	5,809
Restricted cash			—				3,800
Accounts receivable, net			8,440				8,876
Inventories, net			16,013				15,967
Prepaids and other current assets			1,095				1,051
Total current assets			29,561				35,503
Property and equipment, net			1,481				1,621
Goodwill			3,239				3,239
Other intangible assets, net			5,358				5,944
Other long term assets			282				347
Total assets		$	39,921			$	46,654
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable		$	4,404			$	2,887
Bank line of credit			5,281				4,863
Accrued compensation			1,567				2,024
Accrued expenses			6,005				7,809
Accrued warranty			1,500				1,895
Deferred revenue			3,254				3,350
Bank term loan-current portion			—				5,016
Total liabilities			22,011				27,844
Commitments and contingencies (Note 10)
Stockholders’ Equity:
Convertible Preferred Stock, $.01 par value:
Authorized: 2,000,000 shares;
Issued and outstanding: 500,000 shares in 2008 and 2007			5				5
Common Stock, $.01 par value:
Authorized: 30,000,000 shares;
Issued and outstanding: 8,824,301 shares in 2008 and 2007			89				89
Additional paid-in capital			38,727				38,695
Accumulated other comprehensive loss			(128	)			(88	)
Treasury stock, at cost			(430	)			(430	)
(Accumulated deficit) retained earnings			(20,353	)			(19,461	)
Total stockholders’ equity			17,910				18,810
Total liabilities and stockholders’ equity		$	39,921			$	46,654