ConMed (NSDQ:CNMD) released its 4th quarter and full year earnings late Wednesday, reporting profits dipping 30% from last year and seeing shares tumble the next day, down nearly 12%.
The Utica, N.Y.-based company reported profits of $7.9 million, or 28¢ per share, on sales of $191 million for the 3 months ended December 31. ConMed saw bottom-line sales slide 30.8% while overall sales dropped 2% compared with Q4 2014, according to the earnings report.
Adjusted to exclude 1-time items, however, earnings per share were 52¢, beating the Street’s expectations by a slim 1¢. Revenue expectations were only marginally off the Street as well.
For the full year, ConMed reported profits of $30.5 million, or $1.10 per share, on sales of $719 million. That amounts to a 5.3% slide on the bottom line while sales shrunk 2.8% compared with its fiscal year 2014.
Even excluding 1-time items, earnings per share shrunk the previous year, with ConMed posting $1.68 for the year, compared to $1.92 in 2014.
Shares drooped in day trading on Thursday, opening at $41.75 and closing nearly 12% down at $36.78.
“We are pleased with our accomplishments during fiscal 2015, particularly the early signs that our turnaround efforts are starting to gain traction. Despite continued headwinds in our export markets, we reversed the trend of top-line deterioration experienced in 2014 and exited 2015 with 2 consecutive quarters of constant currency revenue growth. In addition, gross margin improvement in the 2nd half of the year and lower operating expenses as a result of cost saving initiatives are positive trends we intend to build on entering 2016. Based on progress made in 2015, and with new commercial leadership in place, we are confident in our ability to deliver continued improvement in operational performance in 2016. Our team is committed to capitalizing on the SurgiQuest acquisition, to investing in innovation, and to further enhancing ConMed’s growth opportunities domestically and internationally,” CEO Curt Hartman said in a press release.
ConMed set its 2016 guidance after releasing the earnings, expecting revenue between $760 and $770 million for the year, with expected earnings per share between $1.85 and $1.95.
In the beginning of January, Conmed closed the acquisition of SurgiQuest, which makes the AirSeal device for use in minimally invasive abdominal surgeries.
The $265 million deal, announced just a week after Milford, Conn.-based SurgiQuest filed for a $75 million initial public offering last November, was funded with a $175 million term loan and a $525 million credit revolver.
ConMed said it expects the buyout to add $55 million to $60 million to the top line during fiscal 2016, with net savings of roughly $15 million annually.
