Updated: 7/28/2011 10:30 a.m.
Royal Philips Electronics’ (NYSE:PHG) health care division posted modest second quarter growth while the company overall slid hard into the red on weak markets and impairment charges.
"Healthcare achieved robust growth of 8 percent, exceeding expectations," newly appointed president & CEO Frans van Houten said during a conference call with investors.
van Houten has been at the helm of international conglomerate since April 2011, and has been with the company in various positions since 1986.
Philips Healthcare’s sales of $3 billion were flat compared to the same time last year, posting a comparable increase of 8 percent "driven by single-digit growth in all businesses," according to the report. Profits jumped up about 28 percent to $396 million EBITA, compared to $310 million for Q2 2010. EBIT was flat at $212.5 million.
"[I]in the U.S., we see a continued strong drive from hospitals to reduce operating expenses and become more efficient. A trend we are now seeing in Europe as well," van Houten said. "We see the patient monitoring markets capitalizing on this drive as hospitals strive for high efficiency by investing in newer technologies. Hospital construction in the US continues to raise projected at 5 percent in 2011 and 9 percent in 2012. As administrators prepare for the influx of newly insured patients and current low interest rates are fueling these infrastructure advancements."*
The company overall posted a steep decline of more than 600 percent in net income to loss of $1.9 billion after a goodwill impairment charge of more than $2 billion, $1.2 billion of which was for health care.
The net loss translates to a loss of $2 per diluted share, compared to $376 earned during the same time last year, which translates to 40 cents per diluted share.
"We are addressing our operational issues, while investing for growth and instilling a new culture of entrepreneurship and accountability," van Houten said in the report.
MassDevice keeps a close eye on public medical device companies, tracking their quarterly sales and earnings reports. For the most recent filings, check out our Earnings Roundup, where we collect each quarter’s reports.
Here’s a quick rundown of a few releases over the past couple days:
Cynosure stays in the red
Cynosure Inc. (NSDQ:CYNO) posted a 23 percent increase in sales to $26.3 million from $21.5 million sold in the second quarter 2010, but doesn’t quite make it out of the red in the three months ended June 30.
The Westford, Mass.-based cosmetic laser device maker reported a loss of $1.3 million, or 10 cents per diluted share, which is a 12 percent decrease in losses compared to the same time in 2010 when the company reported $1.5 million lost, or 12 cents per diluted share.
Q2 earnings for the Lake Forest, Ill.-based provider of clinical information and medication delivery technologies jumped more than 70 percent to $143 million, or 85 cents per diluted share, from last year’s $84 million, or 49 cents per diluted share.
Kinetic Concepts posts a strong quarter
Kinetic Concepts Inc. (NYSE:KCI) boosted sales by 4 percent and earnings by 52 percent for the three months ended June 30. Q2 sales came to $520 million, compared to $498 in sales during the same period of 2010.
Earnings for the San Antonio, Texas-based wound management company leapt to $81 million, or $1.09 per diluted share, compared to $54 million, or 75 cents per diluted share last year.
NuVasive slides in Q2
NuVasive Inc. (NSDQ:NUVA) posted growth in sales but weakened earnings during its second quarter ended June 30. The San Diego, Calif.-based spinal company boosted sales by 11 percent to $133 million, compared to $120 million during the same period last year.
Net income sank 20 percent to $5.4 million, or 13 cents per diluted share, compared to last year’s $6.7 million, ,or 17 cents per diluted share.
Sonosite sinks into the red
Ultrasound company SonoSite Inc. (NSDQ:SONO) saw earnings sink hard despite strong growth in sales during the three months ended June 30. The Bothell, Wash.-based company posted sales of $73 million in its second quarter, an 18 percent increase over $62 million in sales during the same period last year.
Net earnings sank deep into the red with losses of $1.1 million, or 8 cents lost per diluted share, a 158 percent decrease from the company’s earnings of $1.9 million, or 12 cents per diluted share, during Q2 2010.
Teleflex profits cut nearly in half
Teleflex Inc. (NYSE:TFX), which recently ditched all its cargo systems and became a pure-play medical device company, posted 9 percent growth in sales to $391 million for the three months ended June 26, compared to $358 in sales during its second quarter 2010.
Profits sank 43 percent to $34.1 million, or 80 cents per diluted share, compared to $60.1 million, or $1.50 per diluted share last year.
Zimmer touts a healthy quarter
Zimmer Holdings Inc. (NYSE:ZMH) posted growth in sales and earnings for the second quarter ended June 30. The Warsaw, Ind.-based orthopedic maker posted sales of $1.14 billion, a 7.5 percent increase over $1.06 billion sold during the same period last year.
The company’s earnings grew 23 percent to $204 million, or $1.10 per diluted share, compared to $166 million, or 80 cents per diluted share, during Q2 2010.