Zimmer Biomet Holdings, Inc. Reports Third Quarter 2015 Financial Results

WARSAW, Ind., Oct. 29, 2015 /PRNewswire/ --

• Net Sales of $1.76 billion represent an increase of 59.3% over the prior year period on a reported basis, and an increase of 0.7% on an adjusted pro forma, constant currency basis
• Reported diluted EPS decreased 89.1% for the third quarter to $0.11, and adjusted diluted EPS increased 13.1% to $1.64
• Company reinstates share repurchase program
• Company updates 2015 revenue and earnings guidance, raises estimate for first twelve months post-closing net synergies to $155 million

Zimmer Biomet Holdings, Inc. (NYSE and SIX: ZBH) today reported financial results for the quarter ended September 30, 2015. The Company reported third quarter net sales of $1.76 billion, an increase of 59.3% as reported. The increase in the quarter was 0.7% on an adjusted pro forma, constant currency basis over the same prior year period. Reported diluted earnings per share for the quarter were $0.11 and adjusted earnings per share were $1.64, an increase of 13.1% over the prior year period.

“We are pleased with the achievements of our global teams during Zimmer Biomet’s first quarter as a combined company,” said David Dvorak, President and CEO of Zimmer Biomet. “In an operating period marked by significant progress in the execution of our sales channel integration, we generated sequential top-line improvement and strong earnings growth. As we exit this year and progress through 2016, we are well positioned to continue improving revenue growth and delivering on our synergy commitments.”

Net earnings for the third quarter were $22.2 million on a reported basis and $338.4 million on an adjusted basis, an increase of 35.5% adjusted over the prior year period. Operating cash flow for the third quarter was $151.3 million.

During the quarter, the Company paid $37.6 million in dividends, or $0.22 per share.

Additionally, the Company is reinstating its share repurchase program. The existing program was temporarily suspended in April 2014 in anticipation of the Biomet transaction. Currently, $599.5 million of share repurchase authorization remains available under this program.

Guidance
The Company updated its full-year 2015 sales and adjusted earnings per share guidance. Full-year 2015 constant currency revenue, relative to comparable adjusted pro forma 2014 revenue, is now expected to increase between 1.0% and 1.5%. Previously, the Company had expected full-year constant currency revenue to increase between 1.5% and 2.0%. The Company expects foreign currency translation to decrease revenues by approximately 5.75% for the full year, resulting in reported revenue decreasing between 4.25% and 4.75% when compared to adjusted pro forma 2014 revenue for the comparable period.

The Company now expects full-year 2015 adjusted earnings per share to be in a range of $6.83 to $6.87. Previously, the Company estimated full-year 2015 adjusted earnings per share to be in a range of $6.65 to $6.80.

Zimmer Biomet’s increased earnings per share guidance is due, in part, to the Company’s outperformance in the third quarter in capturing operating synergies associated with the merger. The Company now forecasts net synergies of $155.0 million within the first 12 months post-closing, a $20.0 million increase over the previous guidance.

Conference Call
The Company will conduct its third quarter 2015 investor conference call today, October 29, 2015, at 8:00 a.m. Eastern Time. The live audio webcast can be accessed via Zimmer Biomet’s Investor Relations website at http://investor.zimmerbiomet.com. It will be archived for replay following the conference call.

Individuals in the U.S. and Canada who wish to dial into the conference call may do so by dialing (877) 941-1227 and entering conference ID 4696683. For a complete listing of international toll-free and local numbers, please visit http://investor.zimmerbiomet.com. A digital recording will be available 24 hours after the completion of the conference call, from October 30, 2015 to November 29, 2015. To access the recording, U.S. and Canada callers should dial (800) 406-7325 and enter the Access Code ID 4696670. International callers should dial +1 (303) 590-3030.

Sales Tables
The following sales table provides results by geographic segment and product category, as well as the percentage change compared to the prior year quarter, on a reported basis, a pro forma reported basis, and an adjusted pro forma constant currency basis.