LITTLE FALLS, N.J., March 12, 2015 /PRNewswire/ -- CANTEL MEDICAL CORP. (NYSE: CMN) reported US GAAP net income of $11,085,000, or $0.27 per diluted share, inclusive of $0.04 of acquisition related (non-amortization) charges on a 14% increase in sales to $135,430,000 for the second quarter ended January 31, 2015. This compares with net income of $11,126,000 or $0.27 per diluted share, on sales of $119,042,000 for the second quarter ended January 31, 2014. For the six months ended January 31, 2015, the Company reported US GAAP net income of $22,324,000, or $0.54 per diluted share, inclusive of $0.07 of acquisition related (non-amortization) charges on a 15% increase in sales to $272,241,000. This compares with net income of $22,311,000, or $0.54 per diluted share, on sales of $237,314,000 for the six months ended January 31, 2014.
Under non-GAAP measures as we began reporting last quarter, we saw an 18% increase in adjusted net income this quarter to a record $15,097,000, or $0.36 per diluted share. This compares to adjusted net income of $12,777,000, or $0.31 per diluted share for the same quarter last year. For the six months ended January 31, 2015, the Company reported a 14% increase in adjusted net income to a record $29,282,000, or $0.70 per diluted share. This compares to adjusted net income for the six months ended January 31, 2014 of $25,611,000, or $0.62 per diluted share.
Andrew Krakauer, Cantel’s Chief Executive Officer stated, “We are pleased to have delivered solid sales and adjusted net income growth this quarter. We achieved good growth in operating income in our two largest segments - Endoscopy and Water Purification and Filtration. Our Healthcare Disposables business had basically flat performance due to the effect of pull ahead sales to our largest customers in this year’s first quarter. All three business units have greatly benefitted from further investments in new product development, sales and marketing programs, and the integration of recent acquisitions. Overall, we had solid organic sales growth of 6.5%, while our total sales growth of 14% demonstrates the success of our acquisition program.”
Krakauer added, “Our Medivators Endoscopy business achieved robust organic sales growth of 14% in the quarter. Sales in this segment grew 32% including our newly acquired PuriCore and IMS businesses, now called Cantel Medical UK and Cantel Medical Italy, respectively. All product categories in our core Medivators business were strong, including equipment, disinfectant chemicals, procedure room products, as well as service and spare parts. Our recently completed European acquisitions generated $1.8 million in acquisition related (non-amortization) expenses this quarter. When combined with our core United States endoscopy business, we see these acquisitions providing Cantel a strong platform, additional manufacturing capabilities and significant growth potential in European and other international markets.
Our Mar Cor Water Purification and Filtration segment showed organic sales growth of 3% (and 4% overall) against an unusually strong quarter in the same period last year. Growth this quarter was driven primarily on the strength of consumables and service growth, and the segment showed nice leverage with operating income growth of 14%. We were pleased to announce the acquisition of Pure Water Solutions, Inc. on January 2, 2015. This acquisition enhances our Water Purification and Filtration footprint through eight regional offices in the southeastern United States.
Sales in our Crosstex Healthcare Disposables business grew by 2% organically driven by sales of face masks. Revenue growth in this segment was hindered by the pull forward effect we reported last quarter of customers buying products in advance of an announced price increase during the first quarter. We were pleased to announce the acquisition of the DentaPure Dental Waterline Disinfection System on February 23, 2015. This product line will enhance our leadership position in infection prevention and control in the dental industry.
Overall, revenue growth in all operating units drove the improved operating earnings when excluding acquisition related charges.”
The Company’s balance sheet at January 31, 2015 included current assets of $177,961,000, including cash of $24,092,000, a current ratio of 2.9:1, gross debt of $95,500,000 and stockholders’ equity of $380,357,000. Krakauer stated, “We continue to maintain a strong balance sheet and generate substantial cash flow and EBITDAS. When compared with the same quarter last year, our EBITDAS grew by 4% to $25,518,000. Our net debt position increased by $23 million to $71,408,000 during the first six months of fiscal 2015 despite borrowing over $37 million to fund acquisitions.”
Cantel Medical is a leading global company dedicated to delivering innovative infection prevention and control products and services for patients, caregivers, and other healthcare providers which improve outcomes, enhance safety and help save lives.
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