Shares of Wright Medical (NSDQ:WMGI) slid nearly 6% yesterday despite slashed 3rd-quarter losses and a nearly 24% sales spike, after the medical device company missed its earnings-per-share target by a penny.
Memphis, Tenn.-based Wright posted losses of -$61.8 million, or $1.24 per share, on sales of $71.3 million for the 3 months ended Sept. 30, slashing its losses by 147.5% and boosting sales by 23.7% compared with Q3 2013.
Adjusted to exclude 1-time items, EPS were -35¢, just missing Wall Street’s consensus forecast for -34¢. WMGI shares closed down 5.7% at $28.44 apiece yesterday.
President & CEO Robert Palmisano cited "softer than anticipated" sales for its core U.S. foot & ankle business and "certain geographies" overseas for the earnings miss.
"These results were affected by a combination of sales execution issues in the U.S. and an inability to fill some international distributor orders late in the quarter, both of which we have already moved to correct," Palmisano said.
Earlier this month Wright dropped a couple of bombshells on the orthopedics market, announcing a $3.3 billion merger with Dutch rival Tornier (NSDQ:TRNX) and revealing an approvable letter from the FDA for its Augment bone graft.
Palmisano said the Tornier deal presents Wright with significant opportunities for synergy.
"When you put it all together with Tornier, when we actually put together and looked at it, we said this seems like a great combination in just about every way," he told analysts during a conference call. "This is 1 of those things, I think, that if we do this right, it’s going to be not ‘1 and 1 equals 3,’ but ‘1 and 1 equals 10.’"
Wright expects to "hit the ground running" as soon as final FDA approval for Augment comes down, expected during the 1st half of 2015, Palmisano added.
The company confirmed its full-year sales outlook for the full year at $298 million to $302 million, down from prior guidance for sales of $308 million to $312 million, and said it expects adjusted EPS from continuing operations of -$1.40 to -$1.46.