Sports/Extremity/Trauma Underpins Biomet Q2 Revenue Growth

In short

Biomet, Inc. has announced its financial results for the quarter ended November 30, 2012. Net sales increased 9% (11% constant currency) worldwide to $790 million compared with $725 million in the equivalent period a year earlier. This found its way to the bottom of the income statement with an EBITDA figure 8% higher than last year.

Background

Underpinning the healthy growth in top line revenue, U.S. net sales increased 10% to $470.8 million during the second quarter, while Europe net sales decreased 1% (increased 5% constant currency) to $193.9 million and International (primarily Canada, South America, Mexico and the Pacific Rim) net sales increased 21% (22% constant currency) to $125.4 million.

By division

Large Joint Reconstructive sales increased 1% (3% constant currency) worldwide to $444.2 million and increased 2% in the U.S. during the second quarter of fiscal year 2013, compared to the second quarter of fiscal year 2012. Knee sales increased 1% (3% constant currency) worldwide during the second quarter and increased 1% in the U.S. Hip sales increased 1% (3% constant currency) worldwide during the second quarter and increased 2% in the U.S.

Sports/Extremities/Trauma (SET) sales increased 74% (76% constant currency) worldwide to $152.2 million during the second quarter, and increased 65% in the U.S. Excluding the well publicised acquisition of DePuy’s trauma business, S.E.T. sales increased 14% (15% constant currency) worldwide and increased 15% in the U.S.

Sports medicine sales increased 14% (15% constant currency) worldwide during the quarter and increased 3% in the U.S. Extremity sales grew 22% (23% constant currency) worldwide during the quarter, with a growth rate of 32% in the U.S.

Trauma sales increased 268% (272% constant currency) worldwide during the quarter and increased 247% in the U.S. Trauma sales, excluding the Trauma Acquisition, were flat worldwide (increased 1% constant currency) and decreased 1% in the U.S. during the second quarter.

Spine and Bone Healing (non-invasive trauma stimulation and bracing) sales decreased 1% (1% constant currency) worldwide to $74.3 million during the second quarter and were flat in the U.S.

Dental sales decreased 9% (7% constant currency) worldwide to $67.1 million and increased 4% in the U.S. during the second quarter.

Sales of Other products increased 6% (7% constant currency) worldwide to $52.3 million during the second quarter and increased 2% in the U.S.

Company comments

Biomet’s President and Chief Executive Officer Jeffrey R. Binder remarked, “We had a strong second quarter of fiscal year 2013. We reported top line growth of 9%, which translated to 11% growth on a constant currency basis, and we delivered strong bottom line growth. Adjusted EBITDA improved 8% over the prior year quarter to $288 million or 36.5% of net sales, despite the short-term costs incurred in connection with our trauma acquisition. In addition, we’ve substantially completed the integration of our trauma acquisition, and our Sports, Extremities and Trauma (S.E.T.) revenues are now approaching 20% of our net sales at an annualized run rate of $600 million.”

Source: Biomet, Inc.