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Patterson Companies, Inc. Message Board

  • bluecheese4u bluecheese4u Feb 21, 2008 2:01 PM Flag

    Patterson Companies Reports Improved Third Quarter Operating Results

    Patterson Companies Reports Improved Third Quarter Operating Results

    St. Paul, MN—February 21, 2008—Patterson Companies, Inc. (Nasdaq: PDCO) today reported consolidated sales of $776,946,000 for the third quarter of fiscal 2008 ended January 26, an increase of 10% from $709,494,000 in the third quarter of fiscal 2007. This year’s third quarter encompassed one less selling day than the year-earlier period. Including this selling day in Patterson’s third quarter results would have had the effect of increasing consolidated sales by one to two percentage points. Net income came to $60,364,000 or $0.45 per diluted share, up 3% from $58,591,000 or $0.43 per diluted share in the third quarter of fiscal 2007.

    Third quarter revenue and earnings growth was consistent with Patterson’s expectations. Revenues benefited from solidly higher sales of dental equipment, including basic equipment and CEREC 3D® dental restorative systems. As forecasted, earnings growth was affected by reduced gross margins, resulting largely from a shift in the quarter’s sales mix and pressure from the ongoing expansion of the medical unit’s branch office structure. In addition, Patterson’s results in last year’s third quarter included a nonrecurring $1.7 million tax benefit.

    Sales of Patterson Dental, Patterson’s largest business, increased 9% to $584,942,000 in this year’s third quarter.

    • Sales of consumable dental supplies and printed office products increased 4%, or by 5% to 6% after giving effect to the reduced number of selling days in the quarter.

    Sales of dental equipment increased a strong 13% in the third quarter. Sales of basic dental equipment, including digital radiography systems and related software, rose 14% during this period, while sales of the CEREC 3D® dental restorative system were up 10% year-over-year.

    • Sales of other services and products, consisting primarily of technical service parts and labor, software support services and artificial teeth, increased 21% in the third quarter.

    Sales of the Webster Veterinary unit increased 14% in the third quarter of fiscal 2008 to $107,620,000. Sales of Patterson Medical, Patterson’s rehabilitation supply and equipment unit, rose 8% to $84,384,000, which included contributions from the branch offices that have been opened during the past year.

    James W. Wiltz, president and chief executive officer, commented: “We are encouraged by Patterson’s third quarter operating results, which were driven in large part by the performance of our Patterson Dental unit. In addition to solid sales of consumable dental supplies, our dental business benefited from a strong rebound in equipment sales. We also are encouraged by the 10% year-over-year sales growth of the CEREC line. Now that the market transition to CEREC’s new software and crown milling chamber is largely behind us, we are starting to see a growing level of momentum in CEREC system sales. We believe the sales progress generated in the third quarter for both CEREC systems and basic dental equipment should continue in this year’s fourth quarter.”

    He continued: “Patterson’s veterinary business remained strong during this period, even though the third quarter is the slowest period of our fiscal year for sales of such seasonal product as heartworm and flea and tick medications. We also are encouraged by the initial results of Patterson Medical’s branch office strategy, which is part of this unit’s initiative to strengthen its value-added business model. Three new branches were opened during the quarter, bringing to 12 the number of offices Patterson Medical was operating.”

    During the third quarter, cash totaling $264 million was

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