Shares of St. Jude Medical (NYSE:STJ) clawed back some of the value lost yesterday in what 1 waggish analyst termed a “Greek tragedy.”
STJ shares closed down 3.3% yesterday at $39.96 when the company revealed a $56 million writedown after a Greek distributor failed to pay up for an estimated 2 years worth of sales.
Calling it a "Greek tragedy," Citigroup analyst Matthew Dodds wrote a research note to investors that St. Jude waited longer than other companies to write down its Greek receivables.
"[St. Jude] has not disclosed how long it has been since this distributor has paid them, but our math suggests $56 million is at least 2 years’ worth of sales in Greece based on competitor sales basis (pre-crisis)," Dodds wrote.
The Greek government, the International Monetary Fund and the European Union inked a deal in February to resolve that country’s massive debt crisis.
"This agreement, among other macroeconomic and factors specific to the distributor, negatively impacted the solvency and liquidity of the company’s Greek distributor, raising significant doubt regarding the collectability of our outstanding accounts receivable balance of approximately $56 million," St. Jude said in the SEC filing. "We have also experienced delays in the collectability of receivables in certain European member states, particularly in Southern Europe. Although we still expect to fully collect these receivables, there can be no assurances that additional negative economic disruptions and slowdowns in Europe may result in us not fully collecting these receivables, adversely affecting our cash flows, financial position and results of operations. Additional prolongation of the economic disruptions in Europe may negatively impact reimbursement rates and procedural volumes and adversely affect our business and results of operations."
STJ shares were trading at $40.91 as of about 11:50 today, up 2.4% on the day.
Nuance to pay $300M to Transcend
Nuance Communications agreed to pay $300 million to acquire medical transcription and speech editing services provider Transcend Services. Read more
Report: Syneron in talks to buy TransPharma
Syneron Medical (NSDQ:ELOS) is in talks to purchase transdermal drug delivery firm TransPharma Medical for $15 million, according to an Israeli news outlet. Read more
ACT’s 2011 cash burn ramps up on clinical trials
Advanced Cell Technology (OTC:ACT) said its cash burn went up 55% last year, as it ramped up the first -ever clinical trial involving human embryonic stem cells. Read more
CareFusion wins $75M DoD contract
CareFusion (NYSE:CFN) won a $75 million contract from the U.S. Defense Dept. for "medical equipment, maintenance and/or spare parts/repair parts of medical equipment. Read more
Amgen closes Micromet tender offer
Amgen (NSDQ:AMGN) said it now owns more than 88% of Micromet (NSDQ:MITI) and plans to buy the rest by the end of the day, when MITI shares will cease trading publicly and the $11-per-share, $1.16 billion offer closes. Read more
Allezoe deals Organ Transport Systems back to Healthcare of Today
Allezoe Medical Holdings (OTC:ALZM) agreed to reverse its takeover of Organ Transport Systems from Healthcare of Today Inc. after it realized it will take about $10 million to get the technology ready for market. Read more
Hill-Rom raises Q2 dividend
Hill-Rom Holdings (NYSE:HRC) raised its 2nd-quarter dividend by 11 percent to 12.5 cents per share, payable March 30. Read more
Baxter issues Q4 dividend
Baxter International (NYSE:BAX) declared a quarterly dividend of 33.5 cents per share, payable April 2. Read more
Nordion issues Q4 dividend
Nordion (NYSE:NDZ) declared a quarterly dividend of 10 cents per share, payable April 5. Read more
- GE Capital loans $15M to BG Medicine
- Sequent Medical closes $26M Series C round