CTI reports lower than expected net revenues for third fiscal quarter of FY04

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CTI Molecular Imaging Inc. this week revealed that net revenues and earnings for the third fiscal quarter of FY04, ending June 30, will be below prior expectations.

For the third quarter of FY04, net revenues are expected to be approximately $85 million to $90 million versus prior expectations of $95 million to $100 million. CTI said it equates the shortfall to fewer scanner shipments, which totaled 33 units on a consolidated basis in the third quarter of FY04.

Despite the shortfall in scanner shipments, CTI Solutions experienced continued growth in recurring revenues as FDG dose shipments increased 8 percent sequentially and 53 percent over the prior year. According to CTI Solutions, the company holds greater than 50 percent share of the domestic FDG market.

Scanner shipments for the fourth quarter of FY04 and full 2004 fiscal year is anticipated to be approximate 52 units and 156 units, respectively, on a consolidated basis. However, on a preliminary basis, net revenues are expected to be at least $120 million.

"It has become apparent that the rate of unit growth in the domestic positron emission tomography (PET) and PET/CT market has slowed considerably from the prior year," said Ronald Nutt, PhD, president and CEO. "We believe that this slowdown is a result of the dramatic market shift to higher-priced PET/CT scanners. Since PET/CT's are significantly more expensive than dedicated PET systems, this product mix shift has caused a lengthening in the sales cycle and effectively priced out certain customers who do not yet have the physician referral base to financially support a PET/CT."