DJO Global Inc. said it pared its 3rd-quarter losses by more than 18% on sales growth of roughly 5%, but revealed that a fire in a plant in Tunisia could deliver a $5 million hit to its 4th-quarter revenues.
San Diego-based DJO posted losses of $18.4 million on sales of $288.0 million for the 3 months ended Sept. 28, slashing losses by 18.5% on sales growth of 5.1%.
President & CEO Mike Mogul said the fire late in the quarter in the Tunisian plant temporarily reduced its production capacity there.
"Thankfully, no one was injured in the fire, but our production capacity in Tunisia has been temporarily reduced. Given our operational contingency plans, the finished goods inventory on hand at our other distribution locations and our insurance coverage, we do not currently believe that the fire will have a material impact on our results of operations or ability to service our customers. However, we may see revenue disruption in our international markets in the fourth quarter, which we currently estimate could be up to $5 million," Mogul said in prepared remarks. "For the 3rd quarter, adjusted [earnings before interest, taxes and amortization] contracted from the prior-year amounts, due primarily to the lost contribution margin from declining revenues in our recovery sciences segment, partly to the impact of the medical device excise tax, which became effective Jan. 1, 2013, and partly to increased operating expense investments related to new product development and other revenue growth initiatives. Excluding recovery sciences, adjusted EBITDA for the 3rd quarter of 2013 increased by 4.0% compared to adjusted EBITDA for the 3 quarter of 2012."