Young Innovations, Inc. Announces Results for the Quarter and Nine-Months Ended September 30, 2009 and Declares Quarterly Dividend

• Press Release
• Source: Young Innovations, Inc.
• On 5:12 pm EDT, Wednesday October 21, 2009

ST. LOUIS, Oct. 21 /PRNewswire-FirstCall/ -- Young Innovations, Inc. (Nasdaq: YDNT - News) today announced results for the third quarter and the nine-months ended September 30, 2009.

Sales for the third quarter of 2009 were $24.8 million, a decrease of 0.5% over the $24.9 million reported for the third quarter of 2008. Income from operations for the third quarter increased 8.5% to $5.7 million from $5.2 million in the prior year quarter. Net income for the third quarter increased 10.4% to $3.5 million from $3.1 million in 2008. Diluted earnings per share for the third quarter of 2009 were $0.43, an increase of 10.3% over the $0.39 reported in the prior year quarter. Diluted earnings per share were affected by equity compensation expense of $0.03 and diluted shares outstanding for the quarter were 8.0 million for the quarter, both unchanged from the third quarter of 2008.

For the nine months ended September 30, 2009, sales were $73.2 million, decreasing 2.7% from the $75.2 million reported in the prior year period. Income from operations increased 7.5% to $16.0 million from $14.9 million in the prior year nine-month period. Net income was $10.0 million, increasing 9.7% from $9.1 million in the prior year. Diluted earnings per share were $1.25 for the nine months ended September 30, 2009, an increase of 12.6% from $1.11 in the same period of 2008. Diluted earnings per share were affected by equity compensation expense of $0.10 and $0.08 for the nine months ended September 30, 2009 and 2008, respectively, while diluted shares outstanding for the nine months ended September 30, 2009 declined 2.6% to 7.9 million.

Total sales for the third quarter remained stable, as increased demand for our consumable products offset continued weakness in our diagnostic product line. Our consumable products, which include preventive, infection control, endodontic, micro-applicator and home care product lines, posted healthy gains for the quarter. Our diagnostic product line continues to be affected by the weak economy and tight credit markets. Third quarter gross and operating margins increased due to improved production efficiencies, favorable product mix, and continued benefits of facility consolidations.

During the quarter, we implemented a new customer management system and dedicated new resources to customer retention. Increased manufacturing productivity, inventory reductions, and software enhancements contributed to improvements in operating efficiency. Our continued focus on new product development resulted in several additions to our infection control and home care product lines.

Overall, we are pleased to have delivered increased profitability in a challenging economic environment. The investments made over the past few years created an organization that continues to develop and strengthen. We are optimistic about our prospects for future growth.

The company also announced that on October 19, 2009 the Board of Directors declared a quarterly dividend of $0.04 per share payable by the Company on December 15, 2009 to all shareholders of record on November 13, 2009.

A conference call has been scheduled for Thursday, October 22, 2009 at 11:00 A.M. Central Time and can be accessed through InterCall at http://tinyurl.com/yiq309e or on the Company's website, www.ydnt.com.

Young Innovations develops, manufactures, and markets supplies and equipment used by dentists, dental hygienists, dental assistants, and consumers. The Company's product offering includes disposable and metal prophy angles, prophy cups and brushes, dental micro-applicators, panoramic X-ray machines, moisture control products, infection control products, dental handpieces (drills) and related components, endodontic systems, orthodontic toothbrushes, flavored examination gloves, children's toothbrushes, and children's toothpastes. The Company believes it is a leading U.S. manufacturer or distributor of prophy angles and cups, liquid surface disinfectants, dental micro-applicators and obturation units designed for warm, vertical condensation.

Investors are cautioned that this press release as well as other reports and oral statements by Company officials may contain certain forward-looking statements as defined in the Private Securities Litigation and Reform Act of 1995. Forward-looking statements include statements which are predictive in nature, which depend upon or refer to future events or conditions and which include words such as "expects," "anticipates," "intends," "plans," "believes," "estimates," or similar expressions. These statements are not guaranties of future performance and the Company makes no commitment to update or disclose any revisions to forward-looking statements, or any facts, events or circumstances after the date hereof that may bear upon forward-looking statements. Because such statements involve risks and uncertainties, actual actions and strategies and the timing and expected results thereof may differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, those disclosed in the Company's Annual Report on Form 10-K and other reports filed with the Securities and Exchange Commission.

                            Young Innovations, Inc.
                       Consolidated Statements of Income
                (In thousands, except earnings per share data)
                                  (Unaudited)

                          Three Months
                             Ended                Nine Months Ended
                          September 30,             September 30,
                          2009     2008    Change   2009     2008    Change
                          ----     ----    ------   ----     ----    ------

    Net Sales           $24,805  $24,922    -0.5% $73,206  $75,220    -2.7%
    Cost of Goods Sold  $10,857   11,759    -7.7% $32,264   35,328    -8.7%
                        -------   ------    ----  -------   ------    ----
    Gross Profit        $13,948  $13,163     6.0% $40,942  $39,892     2.6%
    % of Net Sales         56.2%    52.8%            55.9%    53.0%

    Selling, General
     and Administrative
     Expense             $8,298    7,955     4.3% $24,899   24,962    -0.3%
    % of Net Sales         33.5%    31.9%            34.0%    33.2%

    Income from
     Operations           5,650    5,208     8.5%  16,043   14,930     7.5%
    % of Net Sales         22.8%    20.9%            21.9%    19.8%

    Interest expense,
     net                    172      324              506    1,069
    Other expense
     (income), net           53      (18)              95     (383)

    Income Before Taxes   5,425    4,902    10.7%  15,442   14,244     8.4%

    Provision for
     Income Taxes         1,951    1,754            5,482    5,164

    Net Income           $3,474   $3,148    10.4%  $9,960   $9,080     9.7%
    % of Net Sales         14.0%    12.6%            13.6%    12.1%

    Basic Earnings Per
     Share                $0.44    $0.40    10.0%   $1.27    $1.13    12.4%

    Basic Weighted
     Average Shares
     Outstanding          7,912    7,915            7,866    8,062

    Earnings Per Share
     (Diluted)            $0.43    $0.39    10.3%   $1.25    $1.11    12.6%

    Diluted Weighted
     Average Shares
     Outstanding          8,040    8,013            7,939    8,153



                           Young Innovations, Inc.
                          Consolidated Balance Sheet
                   September 30, 2009 and December 31, 2008
                    (in thousands, except per share data)


                                                    (Unaudited)
                                                   September 30  December 31
                    Assets                              2009         2008
                                                        ----         ----
    Current assets
      Cash                                               $495         $667
      Accounts receivable, net                         11,115       10,421
      Inventories                                      15,662       16,486
      Other current assets                              4,704        4,759
                                                        -----        -----
    Total current assets                               31,976       32,333
                                                       ------       ------

    Property, plant and equipment, net                 33,542       32,905
    Goodwill                                           80,393       80,334
    Other intangible assets                            11,948       10,602
    Other assets                                        3,014        3,402
                                                        -----        -----

    Total assets                                     $160,873     $159,576
                                                     ========     ========

            Liabilities and Equity
    Current liabilities
      Accounts payable and accrued liabilities        $11,064       $8,840
                                                      -------       ------
    Total current liabilities                          11,064        8,840
                                                       ------        -----

    Long-term debt                                     17,628       29,349
    Long-term secured borrowing                           798        1,281
    Deferred income taxes                              14,033       13,829
    Other noncurrent liabilities                          293            -
                                                          ---          ---
    Total liabilities                                  43,816       53,299
                                                       ------       ------

    Stockholders' equity
      Common stock                                        102          102
      Additional paid-in capital                       23,533       25,336
      Retained earnings                               142,546      133,531
      Common stock in treasury, at cost               (49,304)     (52,673)
      Accumulated other comprehensive income (loss)       180          (19)
                                                          ---          ---
    Total stockholders' equity                        117,057      106,277

    Total liabilities and stockholders' equity       $160,873     $159,576
                                                     ========     ========

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