CR Bard Inc.
) fourth-quarter 2012 adjusted earnings of $1.70 per share beat
the Zacks Consensus Estimate of $1.67 (flat year-over-year).
Adjusted earnings exclude one-time items such as
acquisition-related expenses ($3.1 million) and restructuring
costs ($19 million). The results also exceeded the company's
guidance by a couple of cents.
In the reported quarter, profit was $128.2 million (or $1.52 a
share), up 13% from the year-ago quarter.
For fiscal 2012, the company's adjusted earnings per share of
$6.57 edged past the Zacks Consensus Estimate by 3 cents and
exceeded the year-ago earnings of $6.40 per share (up 3%) as
well. Profit jumped roughly 62% year over year to $530.1 million,
due to controlled expenses.
Despite the sluggish growth rate in the U.S. and dilution from
the Neomend acquisition, the company was able to meet its 2012
adjusted earnings per share guidance.
Revenues inched up 1% (up 2% in constant currency) year over
year to $762.6 million. Revenues surpassed the Zacks Consensus
Estimate of $756 million. Acquisitions contributed 1% to sales
growth in the quarter. The results met the upper-end of the
On a geographic basis, revenues in the U.S. dipped 1% to
$498.1 million due to sustained softness in the market. However,
international sales grew 6% (up 8% in constant currency) to
$264.5 million, led by healthy sales in Japan and Europe.
Moreover, international sales were boosted by double-digit growth
(33%) in emerging markets.
For the fiscal, sales increased 2% year over year to $2,958.1
million, surpassing the Zacks Consensus Estimate of $2,952
Revenues from the core Vascular segment decreased 4% (down 2%
in constant currency) year over year to $212 million. Within
Vascular, endovascular sales fell 3% but Biopsy sales inched up
1% year over year. Electrophysiology ("EP") revenues dropped 2%.
EP Lab system sales inched up 1%, while disposable EP sales
declined 4% year over year. Surgical graft sales rose 4%.
Revenues from peripheral PTA increased 1% in the quarter. Vena
Cava Filter sales dropped 12% in the reported quarter. Revenues
from the stent franchise also dipped 9%, as the Japanese
competitor, which pulled back its product line last year,
returned to the market.
Sales from the Urology division increased 3% (up 3% in
constant currency) to $195.8 million led by solid sales in the
emerging markets and the company's latest targeted temperature
management products. Revenues from the basic drainage division
were up 3%, driven by strong sales in Japan and emerging market
growth. I.C. Foley sales dropped 5% and 9% in the U.S and
international markets, respectively, as these segments faced
continued pricing pressure.
Continence segment's sales were down 5% in the reported
quarter. Urological specialties sales edged down 1%, with an 18%
fall in brachytherapy sales. Revenues from StatLock catheter
stabilization line declined 5% in the quarter.
The company's Oncology segment reported revenue growth of 5%
(up 5% in constant currency) year over year to $203.9 million,
backed by higher international sales. Peripherally inserted
central catheters (PICC) sales climbed 6%, reflecting solid sales
in the emerging markets and Port revenues inched up 2% in the
quarter. The Sherlock 3CG Confirmation technology continues to
contribute to sales growth. Revenues from vascular access
ultrasound products increased 8% in the reported quarter.
Sales from Surgical Specialties business were up 4% at $121.3
million, (4% in constant currency), led by the Neomend
acquisition. Soft tissue repair business grew 1%, whereas natural
tissue products sales dipped 10% due to market pressure. Revenues
from the hernia fixation business were down 9%, narrower than the
double-digit decline posted through the past 5 quarters. Sales
from the performance irrigation business decreased 7%.
Sales from Other segment inched up 1% year over year to $23
Gross margin was 62.3% in the reported quarter compared with
62.5% in the prior-year quarter. Operating margin was 23.2%
versus 18.9% in the year-ago quarter.
Marketing, selling and administrative expenses (as a
percentage of sales) decreased to 27.9% from 28.5% a year ago.
Research and development expenses, as a percentage of sales,
increased to 6.9% from 5.8%.
CR Bard ended the fourth quarter of 2012 with cash, restricted
cash and short-term investments of $921.3 million, up 10.1% on a
sequential basis. Total debt increased 9% sequentially to $1,410
Moving ahead, C.R. Bard expects marginal sales growth for the
first-quarter of 2013 due to difficult year-over-year comparisons
and fewer selling days in the U.S. and Europe. On the earnings
front, the company expects adjusted earnings in the range of
$1.40 to $1.44 a share. The current Zacks Consensus Estimate for
the quarter is $1.64.
For 2013, CR Bard expects constant currency revenue growth in
the range of 2% to 5% (including $60-$70 million royalty benefit
from the Gore litigation). On the earnings front, the company
expects adjusted earnings in the range of $6.25 to $6.30 a
The current Zacks Consensus Estimates for revenue and earnings
per share for full year 2013 are $3,074 million and $6.54,
C.R. Bard's well-diversified end markets and a vast product
portfolio insulate it from fluctuations in any single therapeutic
category. We expect new product launches to drive organic revenue
growth and help CR Bard meet its sales objective. We are also
impressed by the company's initiative to expand into emerging
markets with attractive growth opportunities.
In 2012, the company acquired privately-owned innovative
surgical sealants maker, Neomend, Inc. to expand its surgical
specialty product line. However, increasing competition,
fluctuating currency, pricing/volume pressure and an overall
tough U.S. economy remain areas of concern.
The stock carries a Zacks Rank #3 (Hold). Companies like
Merit Medical Systems, Inc.
), carrying a Zacks Rank #1 (Strong Buy), as well as
The Cooper Companies Inc.
Becton, Dickinson and Company
), which carry a Zacks Rank #2 (Buy), are expected to do well in
the medical industry.
BARD C R INC (BCR): Free Stock Analysis
BECTON DICKINSO (BDX): Free Stock Analysis
COOPER COS (COO): Free Stock Analysis Report
MERIT MEDICAL (MMSI): Free Stock Analysis
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