Stryker shrugs off recall charges in Q4 to end 2012 on target


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.

Sign up to get our free newsletters delivered straight to your inbox

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.

Wall Street reacted positively to Stryker’s report, sending shares of the company up nearly 2% to $63.08 through midday trading. Leerink Swann analyst Richard Newitter said the earnings report contained "no major surprises."

"We come away from SYK’s full 4Q results and conference call reinforced in our view that: (1) under new leadership SYK is taking the right steps to drive improved performance, over time, in key OUS markets, (2) new product cycles and improved execution across all 3 reporting divisions should help support SYK’s growth at or above rates of most key end-markets, and (3) restructuring and prior compliance spending investments will drive increased operating leverage in 2013 and beyond," Newitter wrote.

Stryker in July announced a recall of a pair of hip implants over concerns that the devices may be prone to "fretting and/or corrosion at or about the modular-neck junction," which may lead to pain, swelling and adverse reactions in surrounding tissue.

RSS From Medical Design & Outsourcing

  • 3-phase current transducer from PEM delivers all-in-one convenience
    The new RCTrms 3-ph current transducer from Power Electronic Measurements (PEM) delivers a convenient, safe and accurate solution for measuring current in three phases. It features a thin, clip-around, flexible sensor coil and provides accurate true rms measurement with 4-20 mA or 0-5 V output, enabling simple installation with PLC’s, SCADA systems or automation equipment. […]
  • Safety alert: Recall on two IV solutions from Baxter
    Baxter International announced it is voluntarily recalling two lots of intravenous (IV) solutions to the hospital and user level due to the potential presence of particulate matter. The particulate matter in each case was determined to be an insect and was identified as a result of a customer complaint. The matter was identified prior to […]
  • TSO3 begins shipment of STERIZONE VP4 Sterilizers to U.S.
    TSO3, a developer in sterilization technology for medical devices in healthcare settings, announced that the company has received purchase orders for multiple devices from the U.S. The orders are the result of the collaborative relationship between Getinge Infection Control, its sales and service provider, and TSO3. “Finally,” said R.M. Rumble, president and CEO of TSO3. “Our Vision is […]
  • Turkish medical company is seeking reseller and OEM partners in the U.S.
    UZUMCU Medical Equipment, one of Turkey’s first and largest manufacturers of medical devices, is seeking reseller and OEM partners in the U.S. The company has an array of FDA-certified OR tables, surgical lights, surgical suction units, electro devices and other medical equipment. “We want to bring our experience with distributors throughout Europe and the Middle […]
  • QImaging introduces new CCD cameras for microscopy with modern software to streamline image capture
    QImaging, a manufacturer of scientific cameras for life science and OEM applications, introduces a new series of Retiga CCD cameras, accompanied by QImaging’s new acquisition software to deliver high-performance tools for microscopy and imaging to researchers at an affordable price. The new QImaging Retiga R1, Retiga R3 and Retiga R6 cameras offer valuable technical features […]
  • Sigma-Aldrich announces a new certification to aid IVD customers
    Sigma-Aldrich, a life science and high technology company, announced the company has received ISO 13485 certification for expanded quality assurance capabilities at its Dekalb and Barton facilities located in St. Louis. The certification extends Sigma-Aldrich’s ability to manufacture and offer critical raw materials, such as enzymes, proteins and antibodies used in diagnostic assays, and supplies in vitro […]
  • Prescribing the right power supply: Important considerations for using batteries to power medical devices
    Sol Jacobs, VP and General Manager, Tadiran Batteries Medical technology is advancing rapidly, requiring increasingly sophisticated power management solutions, especially when then the device needs to be self-powered. Battery-powered medical devices encompass a wide range of applications, including surgical drills, power tools, automatic external defibrillators (AEDs), infusion pumps, bone growth stimulators and other wearable devices, […]
  • Qosina announces the launch of its e-commerce website
    Qosina is pleased to announce the launch of its e-commerce website, making it easier to purchase thousands of medical device components from stock inventory. Visitors coming to the new will discover a new look and feel and improvements with every click including: · Easy navigation: A new category structure that mirrors the print catalog […]
  • Athermal laser machining for medical implants is the topic of Norman Noble’s latest whitepaper
    Thermal lasers have achieved extraordinary results in microprecision manufacturing of medical implants and devices the past 20 years. Devices we take for granted today, such as vascular stents, could not be produced without the technology; however, there are still significant limitations on what medical implant and device manufactures can produce using thermal lasers. One major issue […]
  • Sealevel announces the SeaISO family of USB isolators
    Sealevel announces the SeaISO family of USB isolators with 4 kV of medical-grade optical isolation between the host computer and connected USB equipment. SeaISO USB isolators are UL Recognized, in accordance with EN60601-1 3rd Edition, and protect both the power and data lines of connected USB devices from harmful ground loops, damaging transients and surges […]
  • The 21st Century Cures Discussion document recently released to the public
    It has been reported that among the 10,000 known diseases, 7,000 of which are considered rare, there are treatments for only 500. According to Dr. Francis Collins, Director of the National Institutes of Health (NIH), it now takes “around 14 years and $2 billion or more” to develop a new drug and “more than 95% […]

Leave a Reply