0001096906-26-000395
SEC filingUtah Medical Products, Inc. (UTMD) reported a decline in financial performance for fiscal year 2025. Consolidated net sales decreased 5.8% to $38.5 million from $40.9 million in 2024. Gross profit declined 8.9% to $22.0 million, with gross margin contracting to 57.1% from 59.0%. Operating income fell 16.1% to $11.4 million, and net income decreased 18.7% to $11.3 million. Earnings per share (diluted) were $3.48, down from $3.96. The company generated $14.7 million in net cash from operating activities, ended the year with $85.8 million in cash, and returned $12.3 million to shareholders through dividends and share repurchases. Key revenue declines were attributed to lower sales to OEM customer PendoTECH, reduced sales to a China distributor, and lower worldwide Filshie device sales.
Utah Medical Products reported lower financial results for fiscal year 2025 compared to 2024. Net sales declined 5.8% to $38.5 million from $40.9 million. Gross profit decreased 8.9% to $22.0 million, with gross margin contracting 1.9 percentage points to 57.1%. Operating income fell 16.1% to $11.4 million, and net income declined 18.7% to $11.3 million. Earnings per share (diluted) were $3.48 compared to $3.96 in the prior year. The company maintained strong cash generation with $14.7 million in net cash provided by operating activities and ended the year with $85.8 million in cash. Total comprehensive income was $13.8 million, including $2.5 million in foreign currency translation gains.
Revenue declines were concentrated in three areas: PendoTECH OEM sales decreased $2.3 million (85%), China distributor sales of Deltran blood pressure monitoring kits decreased $0.3 million (13%), and worldwide Filshie device sales decreased $0.7 million (7%). These three categories accounted for 140% of the total revenue decline. Geographically, OUS sales represented 41% of total sales at $15.8 million, down 9.7% from 2024. Within OUS sales, 72% were invoiced in foreign currencies. Domestic sales decreased 2.9% to $22.8 million, though domestic Filshie device sales increased 10.8%.
The gross profit margin contraction from 59.0% to 57.1% was attributed to fixed manufacturing overhead costs increasing while sales decreased, along with $140 in U.S. tariffs compared to $15 in 2024. Operating expenses remained relatively flat at $10.6 million (27.5% of sales) compared to $10.5 million (25.8% of sales) in 2024. Within operating expenses, litigation expenses for Filshie product liability lawsuits were $1.4 million (3.5% of sales) compared to $2.1 million (5.2% of sales) in 2024. The company also recorded unusual G&A expenses including a $395 bad debt write-off from a China distributor cancellation fee and a $195 loss from embezzlement at the Australia subsidiary.
The company generated $14.7 million in net cash from operating activities, a slight decrease from $14.8 million in 2024. Investing activities used $0.4 million primarily for property and equipment. Financing activities used $12.3 million for share repurchases ($8.4 million) and dividends paid ($4.0 million). Cash increased by $2.8 million to $85.8 million at year-end. Working capital was $95.1 million with a current ratio of 37.6. Total assets were $122.5 million, including $97.7 million in current assets. The company has no bank debt and maintains strong liquidity.
Management expects 2026 consolidated sales to be approximately the same as 2025, with the loss of PendoTECH and China distributor revenues offset by new product sales and modest organic growth. The company projects gross margin could expand by about one percentage point if lost low-margin revenues are replaced. Operating income is expected to increase 15-18% due to the completion of Femcare identifiable intangible asset amortization in Q1 2026, which will reduce G&A expense by approximately $1.6 million. Management expects EPS to be north of $4.00 per share in 2026. The company plans to continue returning cash to shareholders through dividends and opportunistic share repurchases while seeking accretive acquisition opportunities.