Exactech Underperforms in 4Q - Analyst Blog
March 02 2012 - 3:30AM
Zacks
Orthopedic implant devices maker
Exactech’s (EXAC) adjusted earnings of 18 cents a
share for fourth-quarter fiscal 2011 largely missed the Zacks
Consensus Estimate of 25 cents and were below the year-ago earnings
of 23 cents a share. Profit skid roughly 33% year over year to $1.8
million (or 14 cents a share), impacted by lower domestic sales
mix, foreign currency headwinds and lower profit in its French
operation.
For the fiscal, adjusted earnings
of 89 cents a share also came in well below the Zacks Consensus
Estimate of 96 cents while exceeding the year-ago earnings of 86
cents. The adjusted earnings exclude legal and compliance costs
associated with the company’s settlement with the Department of
Justice.
The Gainesville-based company’s
revenues inched up 2% year over year to $53.1 million in the fourth
quarter, just missing the Zacks Consensus Estimate of $54 million.
For the full year, Exactech raked in sales of $205.4 million, an 8%
annualized increase, marginally missing the Zacks Consensus
Estimate of $206 million.
Exactech noted that its U.S.
revenues fell 2% to $34 million in the fourth quarter while
international revenues surged 11% to $19.1 million. Domestic sales
for the year grew 1% to $133 million while overseas revenues soared
24% to $72.4 million.
Revenues from the company’s larger
knee implant business dipped 2% to $20.1 million in the fourth
quarter. Extremities implant sales spiked 29% to $11 million.
Revenues from hip implant franchise climbed 13% to $9.3 million
while biologic and spine sales tumbled 21% to $5.9 million.
Gross margin edged down to 68.5% in
the fourth quarter from 68.8% a year ago. Operating expenses rose
roughly 4.5% year over year to $32.5 million in the quarter.
The company exited fiscal 2011 with
cash and cash equivalent of around $4.7 million, up 18.5% year over
year. Long-term debt declined 20% year over year to roughly $4.2
million.
Moving ahead, Exactech expects
revenues for fiscal 2012 in the range of $215 million to $223
million. Earnings per share (as reported) for the year are expected
in the band of 88 cents to 96 cents. The corresponding Zacks
Consensus Estimates are $216 million and 93 cents,
respectively.
For the first quarter, Exactech
sees earnings per share in the range of 22 cents to 24 cents on
revenues between $54 million and $57 million. Analysts polled by
Zacks currently expect revenues of $55 million and earnings of 23
cents a share on an average for the first quarter.
Exactech develops and markets
orthopedic implant devices. Its orthopedic products are utilized
for the restoration of bones and joints that have degenerated due
to diseases. Apart from the U.S. the company markets its products
in more than 30 other markets globally.
Exactech competes with the likes
of Wright Medical (WMGI),
Stryker (SYK), Johnson &
Johnson (JNJ) and Zimmer Holdings (ZMH),
some of whom are much larger in terms of size and resources.
EXACTECH INC (EXAC): Free Stock Analysis Report
JOHNSON & JOHNS (JNJ): Free Stock Analysis Report
STRYKER CORP (SYK): Free Stock Analysis Report
WRIGHT MEDICAL (WMGI): Free Stock Analysis Report
ZIMMER HOLDINGS (ZMH): Free Stock Analysis Report
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