The Suwanee, Ga.-based company posted losses of $1.4 million, or 7¢ per share, on sales of $25.7 million for the three months ended September 30, seeing losses shrink 84% while sales shrunk 0.3% compared with the same period during the previous year.
Sales for the quarter narrowly topped the $24.9 million consensus on Wall Street.
“Overall, our business had some challenges during the quarter, which we expect to be temporary in nature. Despite these challenges, we were still able to keep revenue flat on a year over year basis, with diagnostic services revenue outperforming over the prior year. Our Digirad imaging solutions unit within diagnostic services suffered weather related issues due to storms in the southeast but still managed to outperform the prior year quarter by 6%. Mobile Healthcare’s performance in the quarter was impacted by higher than normal equipment and trailer maintenance costs, however interim rental revenue continued to outperform increasing by 24% over the prior year’s quarter. Camera sales again impacted our revenue generation in diagnostic imaging, but a strong September bodes well for a good finish to the year as budgets for hospital systems’ capital expenditures are being funded,” prez & CEO Matt Molchan said in a prepared statement.
The company reaffirmed its financial guidance for the full year, expecting to see sales from continuing operations of between $100 million and $105 million. Digirad lowered its non-GAAP adjusted EBITDA from between $8.5 million and $9.5 million to approximately $7 million.
Shares in the company have fallen 6% today, at $1.25 as of 12:30 p.m. EDT.
In September, Digirad announced plans to convert into a diversified holding company. In its earnings release, the company said that the plan is on track, nd that it expects to close next spring.
Digirad said that it as part of the transition, it is eliminating dividends so that it can launch a share buyback plan “given the attractive valuation of the company’s current stock price.” The company said it plans to purchase up to 2 million shares of its common stock, representing 10% of the outstanding shares.
“Our mission is to grow and maximize value per share over the long-term, and we believe opportunistic share repurchases will better achieve this goal than continuing to pay dividends given our current stock price,” said chair Jeff Eberwein said in a press release.