(Adds details, analyst comments, updates share movement)
By Aradhana Aravindan
BANGALORE, June 25 LCA-Vision Inc LCAV.O, a
provider of laser vision correction services, expects a 40
percent fall in total procedure volume in the second quarter
from a year ago, partly due to a panel recommending U.S. health
regulators make clearer the risks of LASIK procedures.
The company, whose shares sank 31 percent to their lowest
in more than four years, also said that macro-economic
conditions continued to hurt consumer discretionary spending,
leading to softness in appointments at its LasikPlus centers.
RBC Capital Markets analyst Kevin Ellich said the company's
outlook was worse than his estimate of a 15 percent to 20
percent decline in volume. LCA-Vision's total procedure volumes
were 48,668 in the second quarter last year.
Ellich said the outlook was mostly due to the weaker
economy. "Yes, it is possible the FDA panel might have had a
small impact but other operators that we have spoken to really
haven't noticed that."
However, LCA-Vision said its business in May and June had
been hurt by the media coverage leading up to and following the
panel recommendation on April 25.
In mid-May, LCA-Vision had cut its quarterly dividend by
two-thirds and said bookings of pre-operative appointments had
fallen 20 percent during the month since late April.
The company operates LasikPlus vision centers that offer
eye-sight correction services in the United States.
LASIK, or laser-assisted in-situ keratomileusis, is a
procedure which cuts a flap in the eye then uses a laser to
reshape the cornea, helping people with their vision problems.
BATTLING LOWER VOLUMES
The company, which posted a weak first-quarter profit, has
been battling lower procedure volumes as an ailing credit
market has forced consumers to tighten their purse strings.
The company, whose rivals include Advanced Medical Optics
Inc EYE.N and TLC Vision Corp TLCV.O TLC.TO, had cut
almost a fifth of its U.S. work force earlier this year to
combat lower procedure volumes and reduce costs.
RBC's Ellich said further job cuts were likely, although
management had not explicitly talked about it.
On Tuesday, the Cincinnati-based company announced the
resignation of its finance chief of eight years, Alan Buckey.
It did not specify the reason for Buckey's resignation.
LCA-Vision shares, which have lost more that 70 percent of
their value since the beginning of the year, were down about 21
percent at $5.20 in midday trade on Nasdaq. They hit a low of
$4.54 earlier in the session.
(Editing by Himani Sarkar)