Teleflex (NYSE:TFX) said today that it plans to lay off workers and consolidate operations as it looks to save $12 million to $16 million a year, nearly 2 years after announcing a similar plan to cut costs.
Wayne, Pa.-based Teleflex said it hopes the plan, slated to begin during the 2nd quarter, will begin delivering savings in 2017 and be mostly complete by the end of the next year. The company said it plans to relocate some plants and relocate or outsource some distribution.
The plan, announced along with 4th-quarter and full-year 2015 results that came in well ahead of the consensus forecast, is not as large as the restructuring Teleflex announced back in May 2014, which aimed to generate annual savings of $28 million to $35 million. The new plan is expected to cost between $34 million and $44 million, mostly during 2016, Teleflex said.
“This new plan will focus on the consolidation of certain facilities and relocation of manufacturing operations and will allow the company to invest in higher-growth opportunities,” chairman, president & CEO Benson Smith said in prepared remarks.
Teleflex reported profit growth of 99.7%, to $101.1 million or $2.09 per share, on sales of $484.5 million for the 3 months ended Dec. 31, 2015. Revenues rose 1.8% compared with Q4 2014, the company said. Adjusted to exclude 1-time items, earnings per share were $2.01, 9¢ ahead of Wall Street’s consensus.
Full-year profits grew 30.5% to $244.9 million, or $5.10 per share, despite a -1.6% top-line slip to $1.81 billion, compared with 2014. Adjusted EPS were $6.33, 8¢ ahead of The Street.
“2015 was a tremendous year for Teleflex, capped off by a very strong 4th quarter,” Smith said. “During the 4th quarter we delivered constant-currency revenue growth of 7.4%, and Teleflex’s highest adjusted gross and operating margins since transitioning to a pure-play medical device company, reaching 54.1% and 23.7%, respectively.”
Teleflex said it expects adjusted EPS of $7.00 to $7.15 this year, on sales growth of 5% to 6%.
TFX shares closed up 0.5% at $132.46 apiece yesterday.