DENTSPLY International Inc.
), a dental and healthcare products company, reported its adjusted
earnings per share of 52 cents for the first quarter 2012, in line
with the Zacks Consensus Estimate and 2 cents higher than the
earnings in the year-ago comparable period.
In the quarter, reported profit dropped 22.9% to $53.3 million
(or 37 cents a share).
Revenues rose 25.6% year over year to $716.4 million (a
quarterly record), trailing the Zacks Consensus Estimate of $719
million. Excluding precious metal content, net sales soared 26.3%
(up 28.3% in constant currency) to $665.6 million. Growth was led
by takeovers and strong internal sales, especially in the U.S.
Gross margin in the reported quarter increased to 54.8% from
52.6% a year ago. Selling, general and administrative expenses (as
a percentage of sales) were higher at 42.5% versus 35.2% of the
prior-year quarter. Operating margin fell to 12.2% from 17.3% a
DENTSPLY finished the quarter with cash and cash equivalents of
$67.3 million, a decline of 88.3% year over year. Long-tem debt
increased more than two fold to $1,481 million.
Based on an improving U.S. economy and healthy product mix, the
company expects to generate adjusted earnings per share in the band
of $2.22 and $2.30 for fiscal 2012. However, the company is wary
about the sluggish European economy and the soft orthodontics
DENTSPLY is poised to grow its share in the dental implant
market, driven by a strong product base and significant investment
on product/technology innovation and sales/marketing
infrastructure. The acquisition of Astra Tech has reinforced the
company's leadership in the global dental market and broadened its
The company's diverse product range, significant international
presence, new product introductions and acquisition initiatives are
expected to boost operating metrics moving forward.We currently
have a Neutral recommendation on DENTSPLY. The stock currently
retains a Zacks #2 Rank, which translates into a short-term "Buy"
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