Zoll Medical Corp. (NSDQ:ZOLL) posted a 20.2 percent decline in net income during the first quarter, despite logging a 17.6 percent sales increase, hampered by still-slow capital spending.
The Chelmsford, Mass.-based resuscitation device maker reported net income of $2.3 million, or 11 cents per share, for the three months ended Jan. 3, compared with $2.9 million, or 14 cents per share, during Q1 2009. That’s despite sales of $105.2 million, compared with $89.5 million during the first quarter last year. The company had orders worth about $17 million in its pipeline at the end of the most recent quarter, more than double the amount it had at the end of Q1 2009.
Zoll said the sales increase included a $2.3 million boost from foreign exchange rates and a $4.6 million contribution from the temperature management business it acquired from Alsius Corp. last May. (That business pulled in $5 million during the fourth quarter and added nearly $7 million to Zoll‘s 2009 bottom line.)
CEO Richard Packer said the company’s growth businesses, including the Alsius temperature management products and the LifeVest 4000 wearable defibrillator, could carry the company along until capital spending rebounds.
“As we outlined going into this year, if the core business simply remains flat while we await a spending rebound, we expect the growth businesses would be strong enough to achieve this year’s plans. This is what occurred in Q1,” Packer said. “Moving through the year, we expect to increase our level of profitability as we gain leverage in these high growth businesses. We believe we are on track for the year and our outlook for 2010 is unchanged.”
Zoll also announced a deal with healthcare group purchasing organization HealthTrust Purchasing Group LP for its intravascular temperature management system, the Thermogard XP. The system can warm or cool a patient’s blood using a catheter inserted into a vein.
Brentwood, Tenn.-based HealthTrust negotiates $15 billion worth of annual purchasing for 1,400 healthcare facilities.