) posted flat adjusted earnings per share of 44 cents for the
first quarter of fiscal 2014 compared with the comparable quarter
a year ago but exceeded the Zacks Consensus Estimate of 40 cents.
Adjusted net earnings fell marginally by 3% to $96 million from
$99 million a year ago.
BIO-RAD LABS -A (BIO): Free Stock Analysis
CAREFUSION CORP (CFN): Free Stock Analysis
HILL-ROM HLDGS (HRC): Free Stock Analysis
INSYS THERAP (INSY): Free Stock Analysis
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On a reported basis, earnings declined to $78 million or 36 cents
per share from $87 million or 39 cents in the first quarter of
Revenues in the quarter dipped marginally by nearly 1% (both in
reported and constant currency) to $830 million, topping the
Zacks Consensus Estimate of $818 million. The decrease was driven
by fall in Medical Systems revenues.
Adjusted operating expenses inched up 1.8% to $281 million from
$276 million a year ago, due to the medical device excise tax.
Consequently, adjusted operating income fell 11.25% to $142
million from $160 million a year ago while adjusted operating
margin ebbed 200 bps to 17.1% from 19.1% a year ago due to the
unfavorable revenue mix apart from the impact of medical device
dropped 4.9% to $524 million as strong performance in the
Infusion Systems business was offset by weaknesses in the
Respiratory Technologies and Dispensing Technologies businesses.
Segment profit ebbed 27.4% to $74 million from $102 million in
the prior year quarter due to lower volumes in the Dispensing
Technologies business resulting from a product line transition.
Adjusted segment profit dipped 19.6% to $90 million from $112
million in the year-ago quarter.
rose 7% $306 million, driven by double-digit revenue increases in
both the Medical Specialties and Specialty Disposables
businesses. Segment profit rose 2.4% to $42 million, driven by
higher gross margin that was partially offset by increased
investments in R&D. On an adjusted basis, segment profit grew
8.3% to $52 million from $48 million in the prior-year quarter.
CFN's board of directors approved a two-year $750 million share
repurchase program, after completing their previous $500 million
authorization in June this year. Under the present authorization,
the company repurchased approximately 3.3 million shares for $121
million in the quarter. Since the company initiated its
repurchase program in February 2012, CareFusion spent $621
million for repurchasing 18.6 million shares.
CareFusion had cash and cash equivalents of $1,773 million as of
Sep 30, 2013, down marginally from $1,798 million as of Jun 30,
2013. Total debt rose to $1,451 million as of Sep 30, 2013
compared with $1,446 million as of Jun 30, 2013. Debt to
capitalization ratio was flat at 21.2% comparing both the
In the quarter ended Sep 30, 2013, cash flow from operating
activities went down 5.1% to $74.0 million from $78.0 million in
the same period of 2012. But capital expenditure remained the
same at $18 million during the quarter.
Fiscal 2014 Outlook
For fiscal 2014, CFN continues to expect revenues to grow between
1 and 4% on a constant currency basis. Adjusted earnings are also
expected to lie in the previously guided range of $2.30 to $2.40
The guidance is based on an assumed weighted average outstanding
share count of approximately 215 million, which includes the
impact of expected share repurchases during fiscal 2014.
CareFusion is a global corporation serving the health care
industry with products and services that help hospitals
measurably improve the safety and quality of care. Currently, CFN
retains a Zacks Rank #4 (Sell).
Other stocks that are performing well in the medical products
Bio-Rad Laboratories, Inc.
Hill-Rom Holdings, Inc.
INSYS Therapeutics, Inc.
). All of them carry a Zacks Rank #1 (Strong Buy).