Biomet Announces Record Third Quarter and Nine Month Results
WARSAW, Ind., Mar 22, 2002 (BW HealthWire) -- Biomet, Inc. (Nasdaq: BMET chart, msgs) today reported record sales and earnings results for its third quarter ended February 28, 2002. Net sales increased 14% to $304,609,000. Excluding non-recurring charges during the third quarter of fiscal year 2001, operating income increased 13% to $94,330,000, while net income increased 11% to $61,674,000 and diluted earnings per share increased 15% to $.23.
As previously announced, Biomet recorded a one-time pre-tax charge of $26.1 million in the third quarter of fiscal year 2001 associated with the U.S. Court of Appeals for the Federal Circuit's reversal concerning the Tronzo litigation. Last year's charge to earnings did not affect the on-going sales of any of Biomet's product lines. As a result of this charge, reported net income for the third quarter of fiscal year 2001 amounted to $38,205,000, while reported diluted earnings per share represented $.14.
Led by strong growth in its reconstructive, spinal and other product lines, net sales increased 15.4% during the third quarter of fiscal year 2002, excluding the impact of foreign currency which decreased third quarter sales by approximately $900,000 and discontinued products which reduced third quarter sales by approximately $2.5 million. United States and international sales, excluding the effects of foreign currency and discontinued products, increased 16% and 14%, respectively.
Dane A. Miller, Ph.D., Biomet's President and Chief Executive Officer noted, "We are pleased with Biomet's third quarter sales performance which continues to be propelled by balanced growth throughout the Company's principal strategic business units. However, Biomet experienced higher than anticipated S G & A expenses during the third quarter principally as a result of the continued expansion of certain of the Company's direct selling organizations. We continue to build our direct sales operations in Japan, we have expanded Biomet's European sales force by approximately 34 individuals as a result of the recent acquisition of the Synthes-Stratec reconstructive products division, in addition to expanding EBI's direct sales force by approximately 18 sales representatives during the third quarter. We anticipate that the Company's S G & A expenses, as a percent of sales, will decrease as we approach fiscal year 2003. Additionally, Biomet's "other income" declined by $1.5 million compared to the second quarter of fiscal year 2002 and approximately $1.1 million compared to the third quarter of fiscal year 2001 principally as a result of lower interest rates associated with the Company's cash and investments."
Unless otherwise noted, all of the following percentages are quoted on a constant-currency basis and adjusted for discontinued products, as previously discussed.
Worldwide sales of Biomet's reconstructive devices increased 17% during the third quarter of fiscal year 2002 to $184,765,000. Reconstructive devices were led by total knee sales, which increased 19% in the United States and 18% worldwide during the third quarter. Biomet's knee performance continues to be driven by the Repicci II(TM) Unicondylar Knee System and the Ascent(TM) Total Knee System. Total hip sales increased 13% in the United States and 15% worldwide during the third quarter. The Company's M2a(TM) Taper Metal-on-Metal Articulation System and Biomet's broad line of cementless total hip systems continue to experience strong market acceptance in the United States.
Dental reconstructive implants increased 17% during the third quarter of fiscal year 2002. International sales of dental reconstructive implants increased 18%, while domestic sales increased 16% led by the OSSEOTITE(R) dental reconstructive implant system. Bone cement and accessories increased 25% during the third quarter of fiscal year 2002 propelled by the Optivac(R) preparation system and bone cements.
Fixation sales increased 2% to $53,548,000 during the third quarter of fiscal year 2002. Fixation sales were led by sales of electrical stimulation products which increased 7% worldwide during the third quarter of fiscal year 2002 led by EBI's OrthoPak(R) System. External fixation sales increased 4% worldwide and 1% in the United States during the third quarter, internal fixation sales decreased 1% worldwide and increased 5% in the United States during the third quarter, while craniomaxillofacial sales decreased 13% worldwide and increased 3% in the United States during the third quarter.
Spinal sales increased 30% to $32,458,000 during the third quarter. Spinal sales in the United States increased 26%, with spinal implant sales increasing 29% and spinal stimulation sales increasing 25%. The Company's spinal implant sales continue to benefit from EBI's VueLock(TM) Anterior Cervical Plate System and the Omega 21(TM) Spinal Fixation System. Spinal stimulation sales continue to be driven by EBI's non-invasive SpinalPak(R) Spinal Stimulation System. We believe that EBI is currently the fourth largest producer of spinal fusion systems in the United States.
Sales of Biomet's "other products" increased 19% during the third quarter of fiscal year 2002 to $33,838,000. Other product sales in the United States increased 26%, while international sales of other products were flat. Arthroscopy sales increased 36% worldwide and 35% in the United States during the recently completed quarter as a result of Arthrotek's procedure-specific products, the LactoSorb(R) line of resorbable arthroscopic products and the CurvTek(R) Bone Tunneling System. Softgoods and bracing products rose 13% worldwide and 17% in the United States during the recently completed quarter principally as a result of the continued expansion of EBI's Support-On-Site (SOS) stock and bill program.
Biomet, Inc. and its subsidiaries design, manufacture and market products used primarily by musculoskeletal medical specialists in both surgical and non-surgical therapy, including reconstructive and fixation devices, electrical bone growth stimulators, orthopedic support devices, operating room supplies, general surgical instruments, arthroscopy products, spinal implants, bone cements, bone substitutes, craniomaxillofacial implants and dental reconstructive implants and associated instrumentation. Headquartered in Warsaw, Indiana, Biomet and its subsidiaries currently distribute products in more than 100 countries.
For further information contact Greg W. Sasso, Vice President, Corporate Development and Communications at (574) 372-1528 or Barbara Goslee, Manager, Corporate Communications at (574) 372-1514.
This press release contains certain statements that are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. Although the Company believes that the assumptions, on which the forward-looking statements contained herein are based, are reasonable, any of those assumptions could prove to be inaccurate given the inherent uncertainties as to the occurrence or non-occurrence of future events. There can be no assurance that the forward-looking statements contained in this press release will prove to be accurate. The inclusion of a forward-looking statement herein should not be regarded as a representation by the Company that the Company's objectives will be achieved.
All trademarks are owned by Biomet, Inc., or one of its subsidiaries.
All of Biomet's financial information may be obtained on our website at www.biomet.com or you may contact us by e-mail at investor.relations@biometmail.com.
BIOMET, INC. - - QUARTERLY RESULTS
FOR THE PERIODS ENDED FEBRUARY 28
(in thousands, except per share data)
THREE MONTHS ENDED
Feb. 28, 2002 Feb. 28, 2001
------------- ----------------------------------
Non-Recurring As
Charges Reported
Net Sales $304,609 $267,163 $267,163
Cost of Sales 85,238 75,042 75,042
-------- -------- --------
Gross Profit 219,371 192,121 192,121
S, G, & A 112,851 96,975 26,100 123,075
R & D 12,190 11,374 11,374
-------- -------- ------ --------
Operating Income 94,330 83,772 26,100 57,672
Other Income, Net 2,872 3,926 3,926
-------- -------- --------
Income Before Taxes
And Minority
Interest 97,202 87,698 26,100 61,598
Income Taxes 32,924 30,012 8,900 21,112
-------- -------- ------ --------
Income Before
Minority Interest 64,278 57,686 17,200 40,486
Minority Interest 2,604 2,281 2,281
-------- -------- ------ --------
Net Income 61,674 55,405 17,200 38,205
Earnings per Share:
Basic .23 .21 .14
Diluted .23 .20 .14
Basic Shares 269,388 268,245 268,245
Diluted Shares 272,265 271,530 271,530
U.S. sales $217,583 $187,686
Foreign sales 87,026 79,477
Reconstructive
sales $184,765 $158,655
Fixation sales 53,548 52,549
Spinal products 32,458 26,429
Other product sales 33,838 29,530
FOR THE PERIODS ENDED FEBRUARY 28
(in thousands, except per share data)
NINE MONTHS ENDED
Feb. 28, 2002 Feb. 28, 2001
------------- ----------------------------------
Non-Recurring As
Charges Reported
Net Sales $866,018 $742,657 $742,657
Cost of Sales 241,664 214,236 214,236
--------- -------- --------
Gross Profit 624,354 528,421 528,421
S, G, & A 320,846 267,089 26,100 293,189
R & D 35,845 31,533 31,533
--------- -------- ------ --------
Operating Income 267,663 229,799 26,100 203,699
Other Income, Net 11,807 14,107 14,107
--------- -------- --------
Income Before Taxes
And Minority
Interest 279,470 243,906 26,100 217,806
Income Taxes 94,800 83,524 8,900 74,624
--------- -------- ------ --------
Income Before
Minority Interest 184,670 160,382 17,200 143,182
Minority Interest 5,531 4,752 4,752
--------- -------- ------ --------
Net Income 179,139 155,630 17,200 138,430
Earnings per Share:
Basic .66 .58 .52
Diluted .66 .58 .51
Basic Shares 269,554 267,633 267,633
Diluted Shares 272,543 270,561 270,561
U.S. sales $625,702 $520,856
Foreign sales 240,316 221,801
Reconstructive
sales $520,831 $446,548
Fixation sales 160,430 147,304
Spinal products 89,609 62,230
Other product sales 95,148 86,575 |
