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Owens & Minor Q4 Earnings Beat Estimates, Revenues Flat

Owens & Minor Inc.OMI reported adjusted earnings of 56 cents per share in the fourth quarter of 2015, which beat the Zack Consensus Estimate by 7 cents.

Revenues remained flat on a year-over-year basis at $2.49 billion, which was almost in line with the Zacks Consensus Estimate.

Segment Details

Domestic revenues grossed $2.38 billion, demonstrating an increase of 1.3% on a year-over-year basis. The acquisition of Medical Action Industries, which accounted for 1.5% of the annual revenue increase, also drove domestic service revenues.

Domestic segment operating earnings totaled $62.5 million, an increase of 8.7% from the year-ago quarter. The improvement stemmed from revenue growth, benefits from manufacturer product price changes, synergies from Medical Action, expense control initiatives and lower fuel costs.

The International segment revenues grossed $103 million, which deteriorated almost 25.6% from the year-ago quarter. Loss of healthcare customers was one of the primarily factors behind the decline.

The International segment recorded operating earnings of $10.6 million.

Owens & Minor reported full-year 2015 consolidated revenues of $9.77 billion, which improved 3.5% over full-year 2014.

Margin performance

Gross profit declined 6% year over year to $312.2 million. Gross margin remained flat with the year-ago quarter figure at12.6%

Selling, general and administrative (SG&A) expenses fell 3.2% year over year to $236.4 million, whereas depreciation & amortization expenses declined 11.5% from the year-ago quarter to $13.7 million.

Operating earnings increased 7% year over year to $63.1 million primarily due to the decline in operating expenses. Operating margin expanded 20 basis points (bps) on a year-over-year basis to 2.5% in the quarter.

Guidance

For full-year 2016, Owens & Minor forecasts adjusted earnings in the range of $2.00 to $2.05 per share.

Zacks Rank & Key Picks

Currently, Owens & Minor carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the same space include Hill-Rom Holdings, Inc. HRC , LeMaitre Vascular, Inc. LMAT and OraSure Technologies, Inc. OSUR . All the three companies sport a Zacks Rank #1 (Strong Buy).

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OWENS & MINOR (OMI): Free Stock Analysis Report

LEMAITRE VASCLR (LMAT): Free Stock Analysis Report

ORASURE TECH (OSUR): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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