On Tuesday, Henry Schein Inc. (NASDAQ:HSIC) reported a third-quarter adjusted EPS of $1.22, down 7.6% year-over-year, beating the consensus of $1.17.
Sales were $3.17 billion, an increase of 0.4%, missing the consensus of $3.24 billion.
Sales growth reflects 3.2% growth from acquisitions, a 0.2% decrease resulting from foreign currency exchange rates, a 0.4% decrease from lower sales of personal protective equipment (PPE), primarily due to lower glove pricing, and the pace of recovery from the cyber incident late last year.
Internal sales decreased by 2.6%, including a 0.4% decrease from lower PPE sales.
Global dental segment sales were $1.9 billion, down 1.6%, and medical segment sales increased by 2.9% (down 4.8% internally) to $1.1 billion.
Technology and Value-Added Services sales increased 5.1% (internal decline of 1.1%) to $0.2 billion.
"We believe we continued to steadily gain market share in our dental and medical distribution businesses following last year's cyber incident. Our dental equipment business is showing ongoing stability in North America and increased investment by customers in Europe, Australia and New Zealand. Implant and endodontic products had good growth in Europe and Brazil, as well as North America following the successful launch of the BioHorizons Tapered Pro Conical implant in the U.S.," said Stanley Bergman, Chairman of the Board and CEO.
Restructuring Plan: During the third quarter of 2024, the company recorded $48 million in restructuring costs. Actions approved in the third quarter under the new restructuring plan are estimated to provide over $50 million in annual run-rate savings.
The company expects $75 million to $100 million in annual run-rate savings by the end of 2025.
Guidance: "Acquisitions made during our 2022 to 2024 strategic planning cycle, along with new product launches, are delivering strong financial results, and our restructuring plan is on target. We also continue to return capital to shareholders through our share repurchase program. As a result, we exceeded our financial expectations for the quarter, and so today we are increasing our non-GAAP EPS guidance," Bergman concluded.
Henry Schein expects 2024 sales growth of approximately 4%-5% over 2023, compared with prior guidance of 4% – 6% growth.
The company expects 2024 adjusted EPS of $4.74-$4.82 compared with prior guidance of $4.70-$4.82 and a consensus of $4.75.
Price Action: At last check on Tuesday, HSIC stock was down 4.60% at $69.01.
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