Nearly two years after Greatbatch and Lake Region Medical merged to create Frisco, Texas–based Integer, sales are growing, but second-quarter profits did not meet analysts’ expectations, according to earnings released yesterday evening.
Integer earned $3.0 million, or 9 cents per share, off $362.7 million in revenue for the quarter ended June 30, versus a loss of $770,000, or 3 cents per share, off $348.4 million in revenue for the same quarter a year ago.
Adjusted second-quarter net income was 62 cents per share. Analysts on average expected 67 cents per share earnings, according to Yahoo! Finance.
Gary Haire, Integer’s EVP and CFO, told analysts during a conference call that earnings have improved amid “reduced spending on integration, restructuring, and consolidation and optimization activities.”
“These improvements were offset by the unfavorable foreign exchange impact of $5.5 million in the quarter and a $5 million impairment of a minority investment that was made back in the 2008 and 2009 time frame,” Haire said during the call, which was transcribed by Seeking Alpha.
The strengthening euro had Integer lowering its 2017 earnings outlook to $2.55–$2.95 per share, from its previous $2.70 to $3.10 per share range. Integer officials, however, were confident enough in the company’s annual sales growth trajectory that they increased the company’s 2017 revenue estimate to $1.4–$1.43 billion, up from the previous $1.39–$1.43 billion range.
After some downs and ups, Integer’s stock is slightly up midday today, trading at nearly $45 per share. Investors appear to be optimistic about Integer’s prospects; the company’s stock has shot up about 52% in value this year.
With 26 manufacturing facilities around the world and 10,000 employees, Integer’s capabilities are vast. The company could basically develop and manufacture a full structural heart delivery system for an OEM. Have a great idea for a new neuromodulation device and some money? Integer has the capability make a full neuromodulation device for a customer – and is actually betting on long-term growth serving the neuromodulation space.
“We’re the market leader in medical device outsource manufacturing,” CEO Joseph Dziedzic boasted to analysts yesterday.
Said Dziedzic: “We have unrivaled capabilities to serve our customers’ needs, whether an engineered component or a complete device that we have developed, to anything in between. Our innovative design and manufacturing capabilities, our global footprint and scalability, our high-quality and our customer focus enable us to deliver more for our customers than anyone else in our space.”
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