), a medical devices company which specializes in preserving and
processing tissues, recently announced that its Board has approved
the initiation of quarterly cash dividend of 2.5 cents per share.
The company foresees payment of the quarterly dividends each year
in March, June, September and December.
The foremost quarterly cash dividend will be paid on September
21, 2012, to all shareholders of record as of September 14, 2012.
The shares bought and sold on or after September 12, 2012, will not
offer the right to receive the initial quarterly dividend.
The company projects total annual dividend of roughly $2.7
million on the basis of the number of outstanding shares. Per
management, the commencement of a quarterly cash dividend
underlines CryoLife's solid financial stability. It also mirrors
the company's long-run focus on profitability and cash flow
CryoLife plans to use its cash flow from operations to enhance
its product pipeline. The company will also invest in future growth
opportunities and business development. Additionally, CryoLife
intends to continue its share repurchase.
The mediation to re-invest in the company as well as return
profits to shareholders via cash dividends and share repurchase
should boost investor confidence in the business fundamentals. The
initiation of quarterly cash dividend reflects the company's
financial capability to generate adequate profit for future
Earlier, the Board had approved the extension of its share
buyback program to up to $15 million prior to December 31, 2012.
The company repurchased 593,000 shares for $2.9 million (at an
average price of $4.90 per share) in 2011. To date, it has
repurchased 626,000 shares of its outstanding common stock for $3.2
million (at an average price of $5.14 per share) in 2012. CryoLife
still has $10.3 million left under its current share buyback
The declaration of future dividend payments and its payment
dates and record dates depend on the approval by the Board, based
on CryoLife's future earnings, cash flow generation and financial
Headquartered in Kennesaw, Georgia, CyroLife is a forerunner in
preserving and distributing human tissue for transplantation. It
also serves the market for medical devices for cardiac and vascular
purposes. The company is focused on driving revenue growth through
expansion of its core business activities and strategic
acquisitions. The recent acquisitions are expected to be accretive
to the company's revenues in 2012.
However, CryoLife operates in a highly competitive environment
St. Jude Medical
) in certain niches. Also, the company's overdependence on its
mainstay product - BioGlue, and the current expiration of its
patent in the U.S. and in the rest of the world in mid 2013, is a
matter of concern.
CryoLife currently retains a Zacks #3 Rank, which translates
into a short-term Hold rating.
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