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PURITAN-BENNETT's 36% INCREASE IN HOME CARE REVENUES IN FY 1993 HELPS PUSH OVERALL REVENUES UP 17% TO $300 MIL.; GELMAN SCIENCES' SECOND QUARTER NET UP 558.7%

This article was originally published in The Gray Sheet

Executive Summary

Puritan-Bennett's 36% sales increase in its home care business helped push annual revenues up 17% to $300 mil., the firm said March 3 in reporting operating results for the three months and year ended Jan. 31, 1993. The company commented that its "double digit order and sales volume growth [was] led by the exceptional growth of our home-care business and in spite of market conditions adversely affecting our aviation business." The respiration products manufacturer also reported hospital/physician office revenues were up 13%. P-B's results for the fiscal year ended Jan. 31 do not restate sales and earnings to allow for a change during the last 12 months from a calendar-based accounting period that was used in previous years. The FY 1993 sales of $300.1 mil. compare to sales of $256.1 mil. in calendar year 1991. Earnings of $14.6 mil. in fiscal 1993 compare to profit of $574,000 in calendar 1991. For the quarter, earnings were $3.5 mil., up from a loss of $6.2 mil. for the three months ended Jan. 31, 1992, with revenues of $79.5 mil., up 14.1%. For the year and quarter, Chairman and President of P-B Burton Dole Jr. indicated that earnings were "constrained" by the "significant earnings investment associated with developing [the firm's] blood gas monitoring business" and adversely affected by the "strengthening of the U.S. dollar" and "the establishment of a worker's compensation accrual for an individual claim." The Overland Park, Kansas-based firm reports that during the fourth quarter, clinical trials of its PB3300 intra-arterial blood gas monitoring system got underway in the United Kingdom, France, Germany and Italy. Deliveries of the system commenced in the U.S. in September ("The Gray Sheet" Sept. 7, p. 16), and in Japan in October ("The Gray Sheet" Nov. 23, p. 14). The firm expects other international deliveries to commence during the coming year. Gelman Sciences reported earnings of $1.1 mil. for the first half (period ended Jan. 31), up 128.9% from $460,000 in the same period in the previous year. Sales of $41.1 mil. were ahead 4.9% over volume of $39.2 mil. in the first half of fiscal 1992. For the six months, "laboratory product sales increased 9% worldwide, process filtration product sales increased 4%, medical device sales increased 10%, and roll stock microporous membrane sales increased 24% after considering the effect of a stronger U.S. dollar," the firm says in a recent release. Non core-business product sales decreased 35% in accordance with company plans to "deemphasize" that area of operations. For the second quarter, traditionally the microfiltration product manufacturer's weakest, earnings were ahead 558.7% to $415,000 from $63,000 in the same period a year ago, while sales of $20.2 mil. increased 2.9% from $19.6 mil. The Ann Arbor, Michigan-based firm cited a three percent increase in gross margin, lower pollution-related expenses and lower interest expense as reasons for the strong improvement in earnings. Lund, Sweden-based Gambro AB reported sales of $891.9 mil. for the year ended Dec. 31, up 12.3% from $794.2 mil. the previous year. Growing sales pushed income ahead 27.9% to $64.2 mil. [Editor's note: Sales and earnings have been converted by "The Gray Sheet" at an exchange rate of .1413 Swedish kroner to the dollar as of Dec. 31, 1992]. The firm says that its European renal care activities, "with strong sales of such products as dialysis machines, dialyzers with synthetic membranes and dialysis concentrates, contributed substantially to the favorable results." Renal care business sales were up 9% during the year. Gambro also reports its cardiovascular surgery business sales were up seven percent, blood component technology business sales were up 18%, and intensive care and anesthesia business sales were up 17%. A new business group, health care services, was formed last October and includes REN, a 51% owned American chain of dialysis clinics, "other dialysis clinics in Sweden and Italy, and shareholdings in such associated companies as Scandinavian Heart Center in Sweden." During the year, Gambro also acquired the English anesthesia company MIE, the European and U.S. dialysis operations of Organon Teknika, a 26% interest in Thoratec Laboratories, and "an Italian solutions company." Nichols Institute reported fourth quarter (period ended Dec. 31) earnings of $1.9 mil., up from a loss of $2.1 mil. in the year ago quarter. Sales for the three months were up 9.2% to $70.5 mil. For the year, the firm lost $4.3 mil. on sales of $284.2 mil., up 20.3%. The loss was "a result of a second quarter pre-tax restructuring charge of $13 mil. relative to its Dallas operation." The firm recently announced it had terminated discussions for the sale of Nichols' Texas laboratories, replaced three of seven members of Nichols' board of directors and undergone a reorganization of its senior management ("The Gray Sheet" March 8, p. 19).
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