UTICA, N.Y.–(BUSINESS WIRE)–CONMED Corporation (Nasdaq:CNMD) today announced financial results for the second quarter ended June 30, 2015.
“I am encouraged by the progress we have made throughout our commercial organization, and we exited the second quarter with positive momentum across our business. We are well positioned for accelerating growth in the second half and, importantly, remain on track to achieve our full year financial guidance”
Second Quarter 2015 Highlights
- Sales were $181.0 million, a decrease of 3.8%, compared to the second quarter of 2014. On a constant currency basis, sales decreased 0.4% over the prior-year period.
- Diluted earnings per share (GAAP) were $0.27, compared to $0.37 in the second quarter of 2014.
- Adjusted diluted earnings per share were $0.36 versus $0.47 in the prior-year period.
- Appointed Peter Shagory as Executive Vice President, Strategy and Corporate Development.
- On July 1, added David Bronson and John Workman to its Board of Directors.
“I am encouraged by the progress we have made throughout our commercial organization, and we exited the second quarter with positive momentum across our business. We are well positioned for accelerating growth in the second half and, importantly, remain on track to achieve our full year financial guidance,” commented Curt R. Hartman, CONMED’s President and Chief Executive Officer.
Sales Analysis
For the quarter ended June 30, 2015, domestic sales, which represented 49.2% of total revenue, increased 1.9%, driven by growth in capital equipment sales. International sales, which represented 50.8% of total revenue, declined 8.7% compared to the second quarter of 2014 on a reported basis. Foreign currency exchange rates, including the effects of the FX hedging program, had a negative impact of $6.4 million on second quarter sales. In constant currency, international sales decreased 2.5% versus the prior-year period. Outside the United States, a slight increase in the sales of single-use products was more than offset by a decline in capital equipment sales.
Earnings Analysis
Reported net earnings of $7.5 million decreased 27.2% in the quarter, compared to reported net earnings of $10.3 million in the prior year. Reported diluted net earnings per share of $0.27 decreased 27.0% in the quarter, compared to the prior year period. Reported net earnings include restructuring costs in 2015 and 2014, as well as charges for a patent dispute and shareholder activism in 2014. The effect of each of these items on reported net earnings appears in the reconciliation of GAAP to non-GAAP measures provided below.
Excluding the impact of the items described above, adjusted net earnings of $9.9 million decreased 23.5% year over year, and adjusted diluted net earnings per share of $0.36 decreased 23.4% year over year. Lower operating expenses in the current quarter were more than offset by the negative impact of foreign currency, the expensing of unfavorable production variances incurred in prior periods and a higher tax rate.
2015 Outlook
The Company reiterated its previously disclosed constant currency sales guidance, which calls for organic sales growth in 2015 to be in the range of 1% to 3%. Using current exchange rates, CONMED continues to anticipate that reported sales for 2015 will be in the range of $723 million to $738 million, representing a growth range of (2%) to 0%, and that adjusted diluted net earnings per share will be in the range of $1.82 to $1.92.
Conference Call
The Company’s management will host a conference call today at 4:30 p.m. ET to discuss its second quarter results.
To participate in the conference call, dial 877-280-4957 (domestic) or 857-244-7314 (international) and enter the passcode 95923964.
This conference call will also be webcast and can be accessed from the Investors section of CONMED’s web site at www.conmed.com. The webcast replay of the call will be available at the same site approximately one hour after the end of the call.
A recording of the call will also be available from 8:30 p.m. ET on Tuesday, July 21, 2015, until 11:59 p.m. ET on Tuesday, July 28, 2015. To hear this recording, dial 888-286-8010 (domestic) or 617-801-6888 (international) and enter the passcode 99098236.
About CONMED Corporation
CONMED is a medical technology company that provides surgical devices and equipment for minimally invasive procedures. The Company’s products are used by surgeons and physicians in a variety of specialties, including orthopedics, general surgery, gynecology, neurosurgery and gastroenterology. The Company distributes its products worldwide from several manufacturing locations. CONMED has a direct selling presence in 16 countries outside the United States, and international sales constitute over 50% of the Company’s total sales. Headquartered in Utica, New York, the Company employs 3,400 people. For more information, visit www.conmed.com.
