A Heart Helper's New Home - Finally, Zoll Medical Corp. Has a Little Elbow Room
"This was clearly the marquee building out of six or seven that we looked at," said president, chairman and CEO Richard Packer, during a tour of the new facility, which it is subleasing from Naperville, Ill.-based telecom giant Tellabs.
Zoll occupies one of two buildings at Quorum Park, which features easy access to Route 3 and Interstate 495. Siemens AG, a Munich, Germany-based telecom company, took over half of the other building in March, becoming the park's first tenant. The park had sat vacant after Tellabs abandoned plans to take up both buildings two years ago.
Packer said the widespread commercial real estate vacancies helped the company seal the deal with an eight-year lease. Zoll, which has 950 total employees, intends to inhabit the total space gradually over the next three years.
Already, a breakfast and lunch cafe is on site, complete with walk-in refrigerators and self-serve counters, thanks to Burlington-based Erland Inc.
Zoll's noninvasive defibrillators, used to resuscitate heart-attack victims, are sold to hospitals, municipalities, airports and even amusement parks like Six Flags. The company is slated to grow both its bottom and top lines about 20 percent this fiscal year, down from the more rampant growth in years past.
Packer, 45, says Zoll is partially at the whim of public budgets, though he points to recent developments like a $2.7 million state grant that has enabled the company to supply defibrillators to more cities and towns in Massachusetts.
Founded in Cambridge in 1983, Zoll later moved to Woburn and then to Burlington. It went public in 1992. Today, it boasts $182 million in annual sales, $60 million in free cash and zero debt.
One of its flagship products released in March, the Automated External Defibrillator Plus, is a lime-green device used by nonmedical professionals. Carnival Cruise Lines, construction sites and golf courses keep them on hand in case someone has a heart attack.
The company has several other defibrillators used by doctors, nurses and even the military. To test the devices before they're shipped, Zoll has a liquid nitrogen-powered vault that changes temperatures from minus-20 degrees Celsius to 50 degrees Celsius in minutes.
"When we give tours to the public, we put a rose in there, take it out, and then drop it on the floor where it shatters," Packer said.
As for the near future, Zoll is eyeing Sunnyvale, Calif.-based Revivant Corp., a CPR company, for a possible buyout. Last week Zoll announced it had secured a $12 million deal enabling it to take a 15 percent stake in Revivant. Zoll also has an option to buy the company up until Oct. 4, 2004.
Zoll used a small chunk of its free cash for the deal, and could make an additional $15 million in so-called milestone payments. Packer is optimistic that it will result in more revenue for the company, and other opportunities lie in already-existing markets, he added, because Zoll can still expand its market share.
In the year ending last March, the first year that Zoll sold its products in the nonprofessional-defibrillator market, it captured 10 percent of the total market share. In the next two to three years, Packer predicts it could capture up to 25 percent of it.
"That's not at all unreasonable," he said.
Packer admits his industry isn't the most glamorous and that the company isn't as exciting as some. But, he notes, their products do something many companies can't save lives.
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