WARSAW, Ind., Oct. 31, 2016 /PRNewswire/ -- Zimmer Biomet Holdings, Inc. (NYSE and SIX: ZBH) today reported financial results for the quarter ended September 30, 2016. The Company reported third quarter net sales of $1.83 billion, an increase of 4.0% compared to the third quarter of 2015. On an adjusted constant currency basis, revenue increased 3.5% over the prior year period, with the recently acquired LDR Holding Corporation contributing 190 basis points. Diluted earnings per share for the quarter were $0.78, an increase of 609.1% over the prior year period, and adjusted diluted earnings per share were $1.79, an increase of 9.1% over the prior year period.
“Zimmer Biomet’s third quarter performance was highlighted by further acceleration of our global S.E.T. category, as well as our continued strength in the Asia Pacific region,” said David Dvorak, President and CEO of Zimmer Biomet. “We believe that our comprehensive and expanding portfolio of musculoskeletal solutions positions us extremely well to address the evolving needs of customers in the dynamic healthcare environment in which they operate. Going forward, we will continue to focus on enhancements to our commercial and operational execution to more fully leverage our opportunities to improve the quality of life for patients and create value for our stockholders.”
Net earnings for the third quarter were $158.8 million, an increase of 612.5% over the prior year period, and $362.4 million on an adjusted basis, an increase of 7.1% over the prior year period. Operating cash flow for the third quarter was $352.6 million.
In addition, during the quarter, Zimmer Biomet announced several strategic acquisitions to broaden and complement the Company’s musculoskeletal offerings. In July, the Company completed the acquisition of a market leader in cervical disc replacement, LDR Holding Corporation. In August, Zimmer Biomet announced the acquisition of CD Diagnostics, a company focused on developing immunoassays and biomarker testing to inform musculoskeletal treatment decisions that improve patient outcomes. Earlier this month, the Company completed the acquisition of all outstanding shares of Medtech SA, developer of the ROSA® robotics platform for a range of minimally invasive brain, neurological and spinal procedures.
In the quarter, the Company paid $47.9 million in dividends and declared a third quarter dividend of $0.24 per share. The Company also repaid $200 million on its outstanding term loan during the quarter, and borrowed $750 million under a new term loan to repay borrowings under its revolving credit facility.
Guidance
The Company updated its full-year 2016 constant currency revenue and adjusted earnings per share guidance. The Company now estimates full-year revenue to be in a range of $7.630 billion to $7.650 billion, an increase of approximately 27% on a reported basis, or 2.4% to 2.7% on an adjusted pro forma basis, in each case as compared to the prior year. The Company now expects foreign currency translation to decrease revenue for the full year by approximately 0.3%, compared to its previous estimate of 0.5%. Revenue growth, excluding the contribution from LDR Holding Corporation, on a constant currency adjusted pro forma basis, is now expected to be in a range of 1.65% to 1.90% for the full year 2016. Previously, the Company estimated full-year revenue growth to be in a range of 2.5% to 3.0% on a similar basis.
Additionally, the Company now expects its full-year 2016 diluted earnings per share to be in a range of $1.50 to $1.60, and $7.90 to $7.95 on an adjusted basis. Previously, the Company estimated diluted earnings per share to be in a range of $1.50 to $1.75 on a reported basis, and $7.90 to $8.00 on an adjusted basis.
Conference Call
The Company will conduct its third quarter 2016 investor conference call today, October 31, 2016, 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 (888) 312-9837 and entering conference ID 8873986. 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 November 1, 2016 to November 30, 2016. To access the recording, U.S. callers should dial (888) 203-1112 and international callers should dial +1 (719) 457-0820, and enter the Access Code ID 8873986.
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