Symmetry Medical revenue flat amid strategic business changes: 10 things to know

Spinal Tech

Symmetry Medical reported their financial results for the third quarter with flat revenue over the same period last year.

Here are 10 things to know about the financial report:

 

1. Revenue was tallied at $95.9 million, relatively flat over the $95.7 million reported for the same period last year. However, revenue was down 5 percent from the previous quarter in 2014. Current revenue was driven primarily by the company's OEM Solutions segment, which offset the decrease in the Symmetry Surgical segment

 

2. Continuing operations income was $1.3 million. Adjusted income from continuing operations was $4.7 million.

 

3. The earnings per share were $0.04. There was adjusted earnings per share from continuing operations of $0.13.

 

4. The company is on track to complete previously announced definitive agreement to sell its OEM Solutions business and concurrently transfer to Symmetry Medical, Inc.'s shareholders ownership in a new company holding its Symmetry Surgical business. "We remain on track with our proposed transaction to sell our OEM Solutions business and concurrently transfer to Symmetry Medical, Inc.'s shareholders ownership in a new company holding our Symmetry Surgical business," said President and CEO Thomas J. Sullivan. "With the required regulatory approvals complete we are preparing to file our definitive Proxy with the SEC and are focused on completing the shareholder vote and closing the transaction before the end of the year."

 

5. OEM Solutions revenue reached $75.9 million, a 3.3 percent increase over the same period last year. The increase was driven by the instruments, implants and other segments. Those increases were partially offset by declining revenue in the cases segment.

 

6. The Symmetry Surgical segment revenue was $20 million in the third quarter, a 9 percent decrease from the same period last year, or a 2.1 percent decrease neutralized for the distribution rights loss for the alliance New Wave product line. The segment revenue was down 1.6 percent from the previous quarter.

 

7. Gross profit was $25.7 million, relatively flat from last year. The gross margin percentage for the third quarter was 26.8 percent, compared to 26.4 percent last year. The gross margin was driven by improved efficiency in the OEM Solutions segment and a net gain on insurance proceeds received.

 

8. Sales, marketing, general and administrative expenses for the third quarter were $21.2 million, up from $17.4 million last year. The increase was primarily due to higher general and administrative expenses.

 

9. Operating income for the third quarter was $3.1 million, compared to last year when the company reported a $40.3 million operating loss in the third quarter. The operating margin was 3.2 percent in the third quarter, compared to negative 42.1 percent in the same period last year.

 

10. Interest expense in the third quarter was $2.1 million, compared to the interest expense last year of $4.3 million. The decrease was driven by the company's focus on using free cash flow to reduce debt and the amendment of the company's credit facility at the end of 2013. This allowed the company to eliminate its higher rate mezzanine debt.

 

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