RTI Surgical 3Q revenue outlook misses estimates

RTI Surgical says disappointing spinal sales volumes and other problems hurt 3rd-quarter sales

Associated Press

NEW YORK (AP) -- Orthopedic implant maker RTI Surgical said that third-quarter revenue will fall short of its expectations.

The company's shares fell almost 8 percent to $3.70 Wednesday.

RTI expects to report $54.7 million in revenue, below its previous estimate of $59 million to $61 million. Wall Street was looking for something closer to $58.1 million, according to a poll of analysts by FactSet.

The Alachua, Fla., company said sales were hurt by a variety of problems including slower growth in its surgical spine device business, disappointing sales volumes for its spine business, and tissue shortages that affected its international business.

Regulatory issues also affected its results, the company said.

In 2012 the Food and Drug Administration sent the company a warning letter after an inspection of its processing facility. The FDA conducted another inspection in September and did not find any new problems, RTI said.

RTI said the problems didn't affect patient safety or its ability to process or distribute implants, and it didn't have to take any products off the market.

RTI Surgical Inc. is scheduled to report its third-quarter results before the market opens on Oct. 29. It had $44.6 million in revenue during the third quarter of 2012.

The company extended an agreement Medtronic Inc. for the processing of allografts, or grafts taken from human donors, that are used in spinal surgeries. The new agreement with Medtronic, the world's largest medical device company, will run through the end of 2017 and it could be extended to 2027.

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