Second Quarter Highlights:
- The Company had five fewer sales days in the second quarter of fiscal year 2011 (63 sales days) compared with the second quarter of fiscal year 2010 (68 sales days)
- Consolidated net sales decline of 11.7%, with same day sales decline of 4.7%
- Physician Business net sales decline of 13.8%, with same-day sales decline of 1.2% excluding prior-year H1N1-related product sales
- Elder Care Business net sales decline of 6.6%, with same-day sales growth of 0.8%
- Sequential per-day revenue growth of 5.3% over fiscal 2011 first quarter
- Physician Business sequential per-day revenue growth of 6.6%
- Elder Care Business sequential per-day revenue growth of 2.2%
- Consolidated operating margin growth of 27 basis points to 7.1%
- Physician Business operating margin of 10.8%
- Elder Care Business operating margin of 5.8%
- Consolidated cash flow from operations of $11.6 million
JACKSONVILLE, Fla., October 28, 2010 (GLOBE NEWSWIRE) -- PSS World Medical, Inc. (Nasdaq:PSSI) announced today its results for the fiscal 2011 second quarter ended October 1, 2010.
Gary A. Corless, President and Chief Executive Officer, commented, "Our second quarter performance reflects the team's focused execution of our business strategies in a period of economic challenge. Throughout the last two years of slower economic activity, we have continued to invest in solutions-based programs focused on improving the clinical and financial success of caregivers, while adding new customers to counter lower overall healthcare utilization. We remain committed to achieving our goal of $1.27- $1.31 earnings per diluted share for fiscal year 2011."
David M. Bronson, Executive Vice President and Chief Financial Officer, commented, "Despite the triple headwinds of lower physician office utilization, five less selling days, and the comparative effect of last year's H1N1-related revenue, the Company is continuing to expand its profit margins and generate cash without reducing headcount or services. In fact, we have continued to invest in technology and infrastructure projects that will drive future profitability gains. Our strong cash position allowed for the repurchase of two million shares this past quarter, as well as funding some modest acquisitions."
Net sales for the three months ended October 1, 2010, were $496.2 million, a decrease of 11.7% (4.7% same day sales decline), compared with net sales of $562.0 million for the three months ended October 2, 2009. Net sales for the three months ended October 1, 2010, for the Physician Business decreased by 13.8%, with same day sales decline of 7.0% (1.2% same day sales decline excluding H1N1-related product sales in last year's second quarter) while net sales for the Elder Care Business decreased by 6.6%, with same day sales growth of 0.8%. Income from operations for the three months ended October 1, 2010, was $35.4 million compared with income from operations for the three months ended October 2, 2009, of $38.6 million. Net income for the three months ended October 1, 2010, was $19.6 million, or $0.35 per diluted share, compared with net income for the three months ended October 2, 2009, of $21.7 million, or $0.37 per diluted share. The Company noted that it had five fewer sales days (63 sales days) in the second quarter of fiscal year 2011, ended October 1, 2010, compared with the number of sales days (68 sales days) in the second quarter of fiscal year 2010, ended October 2, 2009. The Company will have a total of five fewer sales days (253 sales days) in fiscal year 2011, ended April 1, 2011, compared with the number of sales days (258 sales days) in the fiscal year 2010, ended April, 2, 2010.
Net sales for the six months ended October 1, 2010, were $975.0 million, a decrease of 7.6% (4.0% same day sales decline), compared with net sales of $1,055.5 million for the six months ended October 2, 2009. Net sales for the six months ended October 1, 2010, for the Physician Business decreased by 9.5%, with same day sales decline of 5.9%, while net sales for the Elder Care Business decreased by 3.2%, with same day sales growth of 0.6%. Income from operations for the six months ended October 1, 2010, was $60.7 million compared with income from operations for the six months ended October 2, 2009, of $60.3 million. Net income for the six months ended October 1, 2010 decreased by 4.8% to $33.3 million, or $0.59 earnings per diluted share, compared with net income for the six months ended October 2, 2009, of $35.0 million, or $0.59 earnings per diluted share.
A listen-only simulcast as well as a 90-day online replay of PSS World Medical's fiscal year 2011 second quarter conference call can be found in the Investor Relations/Financial Information sections of the Company's websites, or , respectively, under the heading "Events and Presentations," on October 28, 2010, beginning at 8:30 a.m. Eastern time.
The Company has today filed with the SEC a Form 8-K that includes a copy of this press release and its related Fiscal Year 2011 Second Quarter Financial Workbook, which contains GAAP and non-GAAP financial measures, and is available on the Company's website, . Additional financial information pertaining to PSS World Medical financial results may be found by visiting the Investor Relations/Financial Information sections of the Company's websites, or , respectively, under the heading "Events and Presentations." If you should need assistance accessing the information, please call Investor Relations at 904-332-3000.
PSS World Medical, Inc. is a national distributor of medical products to physicians and elder care providers through its two business units. Since its inception in 1983, PSS has become a leader in the two market segments that it serves with a focused market approach to customer services, a consultative sales force, strategic acquisitions, strong arrangements with product manufacturers and a unique culture of performance.
Certain statements in this release are "forward-looking statements" made pursuant to the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are identified by the use of words such as "expect," "may," "will," "should," "believe," "plan," "anticipate," and "estimate" among others. These statements involve a number of risks and uncertainties, many of which are outside the control of the Company. Actual results may differ materially from those identified in the forward-looking statements. Among the factors that could cause results to differ materially are the following: fluctuating demand for our products and services; national and global economic conditions, including our and our customers' ability to obtain financing; the introduction of new products and services offered by us and our competitors; uncertainty of the impact of recently enacted healthcare laws; consolidation of healthcare providers; proper functioning of our data processing and information technology systems; our ability to successfully execute our global sourcing strategy; pricing pressures on large national and regional accounts and GPOs; customer credit quality and our ability to collect our accounts receivable, particularly in states with significant budget deficits; our ability to successfully execute our mergers and acquisitions strategy; our ability to compete with other medical supply companies and direct manufacturers; multi-tiered cost structures where certain institutions can obtain more favorable prices for medical products than us; our ability to maintain relationships with our suppliers and customers; our ability to retain sales reps and key management; our ability to execute our growth strategy; increased operating costs, including fuel prices; risks involved in maintaining a large amount of inventory; our indebtedness may limit our ability to obtain additional financing or react to market conditions; we face litigation and product liability exposure; weather-related events such as hurricanes may disrupt our and our customers' business; we may be deemed to infringe other persons intellectual property; our business is subject to numerous federal, state and foreign laws and regulations, including state pedigree laws and regulations; general business competitive and economic factors and conditions; and other factors described from time to time in the Company's reports filed with the Securities and Exchange Commission. PSS assumes no obligation to update the information in this release except as otherwise required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.
CONTACT: PSS World Medical, Inc. For investors: Robert C. Weiner, Vice President, Investor Relations 904-332-3287 For media: Brian C. Kosoy, Senior Associate, Public Relations 904-332-4175