IBJNews

Zimmer's earnings slip, but beat expectations

Back to TopCommentsE-mailPrintBookmark and Share

Fourth-quarter profit fell 2 percent at Zimmer Holdings Inc. due to large accounting charges, but still beat estimates of Wall Street analysts.

And the Warsaw-based maker of orthopedic implants predicted revenue and profit will pick up steam in 2013.

Zimmer earned $152.8 million, or 88 cents per share, in the quarter. The company took a $96 million charge to write down the value of its U.S. spine business, which it says is pressured by lower utilization and lower prices.

Excluding that charge and $69 million in other special charges, Zimmer would have earned $1.51 per share. Analysts expected $1.49, according to a survey by Thomson Reuters.

Revenue grew 1 percent, to $1.18 billion, also edging out analyst predictions of $1.17 billion.

Growth was stronger in North America and South America, where sales rose 4 percent. Sales of hip implants rose 2 percent and sales of trauma implants, 10 percent. But sales of knees were flat and sales of spine implants fell 5 percent.

For 2012, Zimmer profit fell 1 percent, to $755 million, from the previous year. Excluding special charges, the company would have earned $932.5 million, an increase of 3 percent.

Revenue totaled $4.47 billion, virtually unchanged.

“For the fourth quarter and full year, Zimmer delivered on our financial commitments, generating double-digit growth in adjusted earnings per share and significant operating margin improvements,” CEO David Dvorak said in a prepared statement.

Zimmer said it expects revenue to grow this year by 2.5 percent to 4.5 percent, when adjusted for foreign currency fluctuations. It also expects earnings per share, excluding special charges, to range between $5.65 and $5.85.

Those results would mark growth of 7 percent to 10 percent over last year’s adjusted earnings per share of $5.30.

Wall Street analyst have said 2013 could be a “breakout” year for Zimmer, which has suffered through several years of slow growth. However, they also worry the company is more exposed than its peers to changes coming in 2014 from the U.S. Patient Protection & Affordable Care Act.

Zimmer shares have risen 23 percent in the past 12 months. They were down about 1 percent Thursday morning, to $73.58 each.
 

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. By Mr. Lee's own admission, he basically ran pro-bono ads on the billboard. Paying advertisers didn't want ads on a controversial, ugly billboard that turned off customers. At least one of Mr. Lee's free advertisers dropped out early because they found that Mr. Lee's advertising was having negative impact. So Mr. Lee is disingenous to say the city now owes him for lost revenue. Mr. Lee quickly realized his monstrosity had a dim future and is trying to get the city to bail him out. And that's why the billboard came down so quickly.

  2. Merchants Square is back. The small strip center to the south of 116th is 100% leased, McAlister’s is doing well in the outlot building. The former O’Charleys is leased but is going through permitting with the State and the town of Carmel. Mac Grill is closing all of their Indy locations (not just Merchants) and this will allow for a new restaurant concept to backfill both of their locations. As for the north side of 116th a new dinner movie theater and brewery is under construction to fill most of the vacancy left by Hobby Lobby and Old Navy.

  3. Yes it does have an ethics commission which enforce the law which prohibits 12 specific items. google it

  4. Thanks for reading and replying. If you want to see the differentiation for research, speaking and consulting, check out the spreadsheet I linked to at the bottom of the post; it is broken out exactly that way. I can only include so much detail in a blog post before it becomes something other than a blog post.

  5. 1. There is no allegation of corruption, Marty, to imply otherwise if false. 2. Is the "State Rule" a law? I suspect not. 3. Is Mr. Woodruff obligated via an employment agreement (contractual obligation) to not work with the engineering firm? 4. In many states a right to earn a living will trump non-competes and other contractual obligations, does Mr. Woodruff's personal right to earn a living trump any contractual obligations that might or might not be out there. 5. Lawyers in state government routinely go work for law firms they were formally working with in their regulatory actions. You can see a steady stream to firms like B&D from state government. It would be interesting for IBJ to do a review of current lawyers and find out how their past decisions affected the law firms clients. Since there is a buffer between regulated company and the regulator working for a law firm technically is not in violation of ethics but you have to wonder if decisions were made in favor of certain firms and quid pro quo jobs resulted. Start with the DOI in this review. Very interesting.

ADVERTISEMENT