Medical device company Stryker Corp. gives back ⅓ of its profits on charges related to the 4th-quarter recall of its Rejuvenate and ABG II modular-neck hip stems, but manages to top analyst estimates nonetheless.
Orthopedic giant Stryker (NYSE:SYK) reported a nearly 33% drop in net income for the 4th quarter on expected charges related to the Rejuvenate and ABG II modular-neck hip stems recall but the company managed to end 2012 strong.
The Kalamazoo, Mich.-based medical device company reported net income of $270 million, or 71¢ per share, on $2.34 billion in sales during the last 3 months of the year, a dramatic drop from the $401 million profit on $2.21 billion in sales the company reported during the same period in 2011.
Excluding the $133 million recall charge, Stryker's Q4 profits jumped 12% to about $1.14 in adjusted earnings per share, beating analysts' expectations, which were in the $1.11-$1.13 range.
Stryker reported sales increases across all 3 product categories during the 4th quarter, including a 7% increase in its reconstructive unit, which includes hips, knees, trauma and extremities; a 2% increase in its MedSurg division; and a 10% increase in its neurotechnology and spine division.
For the full year of 2012 Stryker reported a $1.29 billion profit, or $3.39 per share, on $8.65 billion in sales, a 3.5% decrease from the $1.34 billion, or $3.45 per share, on $8.30 billion in sales. The company also saw a 3% increase in its reconstructive and MedSurg units and a 9% jump in neurotechnology and spine.
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