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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowOrthopedic implant maker Zimmer Holdings Inc. today said its fourth-quarter profit dropped 37 percent due to slowing sales and the cost of buying Abbott Spine.
Warsaw-based Zimmer said its profit decreased to $167.5 million, or 75 cents per share, from $263.8 million, or $1.12 per share, in the prior-year period. Revenue fell 4 percent to $1.03 billion from $1.07 billion due to the impact of unfavorable currency exchange. Sales of reconstructive products and hip and knee implants decreased, hurting revenue.
Zimmer closed the buyout of Abbott Spine in October, adding the company to its own spine business. The deal is expected to increase Zimmer’s profit starting in 2011. Purchase and integration expenses cost the company 19 cents per share in the fourth quarter.
Excluding those and other one-time charges, Zimmer’s profit was $1 per share.
That matched analyst estimates. However, Wall Street expected $1.09 billion in revenue, according to Thomson Reuters.
In the fourth quarter, sales of reconstructive products fell 5 percent to $832 million. Knee-implant revenue slid 3 percent, to $431 million, and hip revenue declined 7 percent to $314 million.
For the year, Zimmer’s adjusted profit fell 4 percent, to $924.3 million, from $961.6 million. Its per-share profit was unchanged at $4.05 due to stock buybacks. Revenue rose 6 percent, to $4.12 billion, from $3.9 billion.
While the stronger dollar hurt the company’s revenue in the fourth quarter, its weakness earlier in the year helped boost Zimmer’s sales growth.
Looking to 2009, Zimmer forecast a smaller profit and less revenue than analysts expected.
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