CONMED Corporation Comments on Expected Third Quarter 2005 Results

12 October 2005

CONMED Corporation
(Nasdaq: CNMD) today announced that sales for the third quarter of 2005 are
expected to be approximately $150 million, an increase of 13% over the third
quarter of 2004. This is below the Company's previously announced third
quarter estimate of $153-$156 million. As a consequence, management believes
that the third quarter Non-GAAP net income and diluted earnings per share,
which exclude previously disclosed transition charges for the Endoscopic
Technologies acquisition, will approximate $9.3 - $9.6 million and $0.31 -
$0.32, respectively. GAAP net income and diluted earnings per share are
expected to be $7.5 - $7.7 million and $0.25 - $0.26, respectively. The
Company anticipates release of final third quarter results on October 25,
2005.
"While the third quarter sales tend to be our weakest due to the seasonal
nature of elective surgeries, our reports from the field suggest that this
quarter was especially weak. We are aware of anecdotal information that
elective surgeries in many geographic regions of the United States have been
less in the summer of 2005 than the previous summer. Further, sales of
capital equipment have been slowed as hospital customers appear to be taking
longer to conclude the buying process. Outside the United States, we are
pleased with our continued international momentum," said Joseph J. Corasanti,
President and Chief Operating Officer.
The Company's overall sales increase for the quarter ending September 30,
2005 is primarily due to the effects of the Endoscopic Technologies
acquisition completed in 2004. Excluding the sales derived from the
acquisition, single-use product sales in the United States generally had flat
growth, while certain capital products such as video systems experienced a
decline compared to the third quarter of 2004 due to a difficult comparison
with a particularly strong quarter in the prior year. While year-to-date
sales growth for the Arthroscopy and Powered Surgical Instruments product
lines of 5.9% and 5.0% approached the Company's internal growth targets, sales
in these product lines were flat in the third quarter of 2005 as compared to
2004. Sales of products outside of the United States generally met the
Company's expectations with organic growth of 11% (excluding the effects of
the Endoscopic Technologies acquisition and foreign currency exchange changes)
over the third quarter of 2004.
The Company's net sales (in thousands) for the quarter and nine-months
ending September 30, 2005 are estimated as follows:

Three Months Ended Nine Months Ended

September Growth September Growth
2004 2005 2004 2005
Arthroscopy $50,800 $50,200 -1.2% $150,100 $159,000 5.9%

Powered Surgical
Instruments 30,200 30,500 1.0% 95,100 99,900 5.0%

Electrosurgery 21,200 22,400 5.7% 62,000 65,900 6.3%

Endosurgery 11,400 12,900 13.2% 34,900 38,100 9.2%

Patient Care 18,700 18,800 0.5% 55,100 56,800 3.1%

132,300 134,800 1.9% 397,200 419,700 5.7%

Endoscopic
Technologies - 15,200 - 44,500

$132,300 $150,000 13.4% $397,200 $464,200 16.9%

From a cost standpoint, CONMED continues to experience significant rising
raw material pricing on petroleum based plastics and increased distribution
costs. This has caused the profit margin to decline on many of our products.
Also, legal expense related to the Company's antitrust lawsuit against a
competitor is increasing.
The Company anticipates that slower growing surgical procedure trends and
the longer closing process for capital equipment experienced in the third
quarter of 2005 will continue throughout the remainder of the year.
Therefore, management projects limited fourth quarter domestic sales growth
coupled with solid international sales improvement of approximately 11%. This
growth mix, as well as higher petroleum based plastic raw materials and
litigation costs, are expected to result in estimated sales of $163 - $166
million and Non-GAAP diluted earnings per share of $0.36- $0.40.
Looking ahead to 2006, CONMED believes that a number of factors will have
a positive effect on the Company's growth rate, including the anticipated new
product pipe-line, improved sales-force performance, and return to normal
elective procedure rates. The Company expects that with these underlying
factors, CONMED will achieve top-line organic growth of approximately 6% for
2006 over 2005, an improvement from the expected 4% organic growth in 2005.
It is the Company's intention to provide net income and earnings per share
guidance for 2006 in the near future once raw material costs and litigation
expenses associated with our antitrust lawsuit against a competitor are better
known for the next year.
Mr. Corasanti concluded, "While we are disappointed that our anticipated
results for 2005 do not meet our original expectations, we have accomplished
much in the last nine months and remain optimistic about our business
prospects in 2006. With respect to the Endoscopic Technologies product line,
we are well on our way to completing the manufacturing transition. We remain
pleased with our ability to reduce our debt levels continuously with cash
generated each quarter. Lastly, we believe that the number of recently
released products and the additional products scheduled to be released in the
coming months will help fuel our future growth."
CONMED expects that the final results for the third quarter of 2005 will
be made available on Tuesday, October 25, 2005 before the market opens. It
will also broadcast a conference call to further discuss the results and
projections live over the Internet on the same date at 10:00 a.m. Eastern
Time. This broadcast can be accessed from CONMED's web site at
http://www.conmed.com. Replays of the call will be made available through
November 1, 2005.

CONMED Profile
CONMED is a medical technology company with an emphasis on surgical
devices and equipment for minimally invasive procedures and monitoring. The
Company's products serve the clinical areas of arthroscopy, powered surgical
instruments, electrosurgery, cardiac monitoring disposables, endosurgery and
endoscopic technologies. They are used by surgeons and physicians in a
variety of specialties including orthopedics, general surgery, gynecology,
neurosurgery, and gastroenterology. Headquartered in Utica, New York, the
Company's 3,100 employees distribute its products worldwide from eleven
manufacturing locations.

Forward Looking Information
This press release contains forward-looking statements based on certain
assumptions and contingencies that involve risks and uncertainties. The
forward-looking statements are made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995 and relate to the
Company's performance on a going-forward basis. The forward-looking
statements in this press release involve risks and uncertainties which could
cause actual results, performance or trends, including the above mentioned
anticipated revenues and earnings, to differ materially from those expressed
in the forward-looking statements herein or in previous disclosures. The
Company believes that all forward-looking statements made by it have a
reasonable basis, but there can be no assurance that management's
expectations, beliefs or projections as expressed in the forward-looking
statements will actually occur or prove to be correct. In addition to general
industry and economic conditions, factors that could cause actual results to
differ materially from those discussed in the forward-looking statements in
this press release include, but are not limited to: (i) the failure of any one
or more of the assumptions stated above, to prove to be correct; (ii) the
risks relating to forward-looking statements discussed in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2004; (iii)
cyclical purchasing patterns from customers, end-users and dealers; (iv)
timely release of new products, and acceptance of such new products by the
market; (v) the introduction of new products by competitors and other
competitive responses; (vi) the possibility that any acquisition (and its
integration) or other transaction may require the Company to reconsider its
financial assumptions and goals/targets; (vii) increasing costs for raw
material and transportation; and/or (viii) the Company's ability to devise
and execute strategies to respond to market conditions.