Chinese medical devices maker,
Mindray Medical International Ltd
) posted a 17.8% rise in 2013-second-quarter adjusted earnings
per share to 53 cents from 45 cents a year ago and met the Zacks
Consensus Estimate. Reported net earnings rose 19.3%
year-over-year to $62.1 million from $52.0 million in the second
quarter of 2012.
Net revenues grew 14.7% to $307.2 million but missed the Zacks
Consensus Estimate of $319 million. Thanks to MR's strong China
sales that surged 27.9% to $147.4 million, representing 48.0% of
the company's total net revenues. International sales were $159.7
million, up 4.7% a year ago.
Patient Monitoring & Life Support Products
rose 2.3% to $117.2 million from $114.6 million in the second
quarter of 2012, contributing 38.2% to overall net revenues in
In-Vitro Diagnostic Products
went up 19.5% to $88.3 million from $73.9 million in the
prior-year quarter, contributing 28.7% to net revenues. Reagents
sales accounted for 36.6% of this segment's net revenues.
Medical Imaging Systems
escalated 18.6% to $76.1 million from $64.1 million in the
2012-quarter, contributing 24.8% to net revenues.
(including sales from the orthopedics business, service revenues
from extended warranties, sales of accessories and repair service
revenues for post-warranty period) soared 68.7% to $25.5 million
from $15.1 million a year ago, contributing 8.3% to overall net
MR had $195.4 million in cash and cash equivalents as of Jun 30,
2013, down 21.2% from $247.9 million as of Dec 31, 2012. Total
bank loans stood at $195.1 million, up 44.3% from $135.1 million
as of Dec 31, 2012.
In the first six months of 2013, cash flow from operating
activities fell 2.3% to $118.6 million from $121.5 million in the
same period of 2012, due to unfavorable changes in current assets
and liabilities, net of effects of acquisitions. Capital
expenditure increased 22.6% to $40.2 million compared with $32.8
million a year ago.
Mindray provides guidance on a full-year basis. The company
raised its revenue guidance as it expects at least 18% rise in
revenues over 2012. However, MR reiterated adjusted net earnings
guidance, anticipating at least 15% rise from 2012.
The guidance excludes any tax benefit related to the National
Key Software Enterprise status and assumes a corporate income tax
rate of 15% for the Shenzhen subsidiary. Mindray also expects
capital expenditures of $130 million for the year.
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Mindray is a bellwether in the Chinese MedTech industry with a
solid international presence. A key distinction with domestic
competitors is that the majority of Mindray's products have CE
Mark and/or Food and Drug Administration (FDA) clearance.
MR maintains a decent product pipeline and brings out several new
products each year. New products contribute in a major way to the
Currently, the stock carries a Zacks Rank #2 (Buy). Other stocks
that are also performing well in the medical instruments industry
), both with a Zacks Rank #1 (Strong Buy), and
IDEXX Laboratories, Inc.
) with a Zacks Rank #2 (Buy).