Invacare (NYSE:IVC) got a rise from Wall Street after releasing its 3rd-quarter earnings report, posting deep losses in sales and continuing earnings that nonetheless beat analysts’ estimates.
The medical device maker posted earnings of $16.1 million, or 50¢ per diluted share, on sales of $341.2 million during the 3 months ended Sept. 30, 2013. That’s a 5.6% decrease in sales and a giant 462% boost to the bottom line compared with the same period last year, when Invacare posted earnings of $2.9 million, or 9¢ per share, on sales of $361.5 million.
Continuing operations looked less rosy for Invacare, which which recently sold off its medical recliner business. The company posted continuing operations losses of $5.4 million, translating to an adjusted 18¢ lost per share for the quarter, which still beat analysts’ estimates by 8¢.
The report preceded a giant jump on Wall Street, where IVC shares gained nearly 10% in a single day and nearly 13% by the end of the week. IVC shares closed at $17.82 on Monday, Oct. 21, and were up to $20.11 at the end of the day Friday, October 25.
Invacare also reported that it’s still making its way out of an FDA injunction that earlier this year shut down a pair of company facilities. Invacare’s corporate headquarters and a wheelchair manufacturing facility were largely shut down and ordered to undergo 3rd-party inspections to demonstrate compliance with FDA manufacturing guidelines. The device maker managed to eke out a modest profit in Q2, despite struggling through a year that CEO Gerald Blouch called "1 of the most challenging in the company’s history."
Invacare announced in July that it was permitted to resume design activities at headquarters and at the manufacturing facility, having won a partial go-ahead from the FDA and getting one step closer to exiting the injunction phase of the consent decree. The device maker said it planned to ramp up wheelchair and power bed design operations and that it will keep investors updated on the final of 3 certification reports mandated by the FDA, which Invacare said it still expects to file mid-November.
"We have made significant progress on the final, most comprehensive 3rd-party certification audit at the Corporate and Taylor Street facilities in Elyria, Ohio," Invacare president & CEO Gerald Blouch said in prepared remarks. "In addition, since receiving the FDA’s acceptance of the second certification report in July, the company has restarted new product development on critical projects, such as complex power wheelchairs."
