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CONMED Corporation Announces Third Quarter 2022 Financial Results

LARGO, Fla., October 26, 2022--(BUSINESS WIRE)--CONMED Corporation (NYSE: CNMD) today announced financial results for the third quarter ended September 30, 2022.

Third Quarter 2022 Highlights

  • Sales of $275.1 million increased 10.6% year over year as reported and 12.1% in constant currency. Acquisitions contributed approximately 420 basis points of growth.

  • Domestic revenue increased 14.2% year over year.

  • International revenue increased 6.2% year over year as reported and 9.6% in constant currency.

  • Diluted net earnings per share (GAAP) were $1.48, compared to diluted net earnings per share (GAAP) of $0.47 in the third quarter of 2021.

  • Adjusted diluted net earnings per share(1) were $0.77, a decrease of 3.8% compared to adjusted diluted net earnings per share of $0.80 in the third quarter of 2021.

  • Closed Biorez transaction on August 9, 2022.

  • Published ESG Sustainability Report subsequent to quarter end.

"I’m proud that our third quarter results delivered strong top-line growth in a tougher-than-expected environment," commented Curt R. Hartman, CONMED’s Chair of the Board, President, and Chief Executive Officer. "During the quarter we closed on our acquisition of Biorez, and I am pleased that both our In2Bones and Biorez integrations are off to fantastic starts. I am confident that both of these businesses will add to our future outlook of sustained growth in revenue and profitability."

2022 Outlook

The Company is narrowing its revenue guidance for the full year 2022 and now expects revenue between $1.1 billion and $1.115 billion compared to its prior guidance of between $1.095 billion and $1.140 billion. Based on recent exchange rates, the Company now expects foreign exchange to have a 150 to 180 bps negative impact on full-year 2022 revenue growth compared to its prior estimate of 100 to 150 bps negative impact.

The Company now expects full-year 2022 adjusted diluted net earnings per share in the range of $3.21 to $3.28, down from the prior range of $3.25 to $3.45.

Supplemental Financial Disclosures

(1) A reconciliation of reported diluted net earnings per share to adjusted diluted net earnings per share, a non-GAAP financial measure, appears below.

Conference Call

The Company’s management will host a conference call today at 4:30 p.m. ET to discuss its third quarter 2022 results.

To participate in the conference call via telephone, please click here to pre-register and obtain the dial-in number and passcode.

This conference call will also be webcast and can be accessed from the "Investors" section of CONMED's website at www.conmed.com. The webcast replay of the call will be available at the same site approximately one hour after the end of the call.

Consolidated Condensed Statements of Income (Loss)

(in thousands except per share amounts, unaudited)

Three Months Ended

Nine Months Ended

September 30,

September 30,

2022

2021

2022

2021

Net sales

$

275,088

$

248,827

$

794,605

$

736,665

Cost of sales

123,473

106,521

355,222

324,485

Gross profit

151,615

142,306

439,383

412,180

% of sales

55.1

%

57.2

%

55.3

%

56.0

%

Selling & administrative expense

114,600

104,736

333,302

307,476

Research & development expense

12,767

10,859

34,932

32,203

Income from operations

24,248

26,711

71,149

72,501

% of sales

8.8

%

10.7

%

9.0

%

9.8

%

Interest expense

8,536

8,145

19,462

27,917

Other expense

-

1,127

112,011

1,127

Income (loss) before income taxes

15,712

17,439

(60,324

)

43,457

Provision (benefit) for income taxes

(30,438

)

2,491

46,842

5,359

Net income (loss)

$

46,150

$

14,948

$

(107,166

)

$

38,098

Basic EPS

$

1.51

$

0.51

$

(3.59

)

$

1.31

Diluted EPS

1.48

0.47

(3.59

)

1.19

Basic shares

30,473

29,179

29,892

29,097

Diluted shares

31,103

32,143

29,892

32,020

Sales Summary

(in millions, unaudited)

Three Months Ended September 30,

% Change

Domestic

International

2022

2021

As Reported

Impact of

Foreign Currency

Constant Currency

As Reported

As Reported

Impact of Foreign Currency

Constant Currency

Orthopedic Surgery

$

118.6

$

105.7

12.2

%

1.8

%

14.0

%

20.4

%

7.6

%

2.8

%

10.4

%

General Surgery

156.5

143.1

9.4

%

1.3

%

10.7

%

11.8

%

4.0

%

4.5

%

8.5

%

$

275.1

$

248.8

10.6

%

1.5

%

12.1

%

14.2

%

6.2

%

3.4

%

9.6

%

Single-use Products

$

231.3

$

200.9

15.1

%

1.6

%

16.7

%

18.8

%

10.2

%

3.8

%

14.0

%

Capital Products

43.8

47.9

-8.5

%

1.2

%

-7.3

%

-9.0

%

-8.0

%

2.3

%

-5.7

%

$

275.1

$

248.8

10.6

%

1.5

%

12.1

%

14.2

%

6.2

%

3.4

%

9.6

%

Domestic

$

155.7

$

136.4

14.2

%

0.0

%

14.2

%

International

119.4

112.4

6.2

%

3.4

%

9.6

%

$

275.1

$

248.8

10.6

%

1.5

%

12.1

%

Nine Months Ended September 30,

% Change

Domestic

International

2022

2021

As Reported

Impact of Foreign Currency

Constant Currency

As Reported

As Reported

Impact of Foreign Currency

Constant Currency

Orthopedic Surgery

$

346.3

$

320.8

8.0

%

1.0

%

9.0

%

7.1

%

8.4

%

1.7

%

10.1

%

General Surgery

448.3

415.9

7.8

%

0.9

%

8.7

%

8.3

%

6.6

%

3.0

%

9.6

%

$

794.6

$

736.7

7.9

%

0.9

%

8.8

%

8.0

%

7.7

%

2.2

%

9.9

%

Single-use Products

$

663.1

$

597.3

11.0

%

1.0

%

12.0

%

11.0

%

11.0

%

2.3

%

13.3

%

Capital Products

131.5

139.4

-5.6

%

0.9

%

-4.7

%

-7.8

%

-3.7

%

1.7

%

-2.0

%

$

794.6

$

736.7

7.9

%

0.9

%

8.8

%

8.0

%

7.7

%

2.2

%

9.9

%

Domestic

$

436.1

$

404.0

8.0

%

0.0

%

8.0

%

International

358.5

332.7

7.7

%

2.2

%

9.9

%

$

794.6

$

736.7

7.9

%

0.9

%

8.8

%

Reconciliation of Reported Net Income to Adjusted Net Income

(in thousands, except per share amounts, unaudited)

Three Months Ended September 30, 2022

Gross Profit

Selling & Administrative Expense

Operating Income

Interest
Expense

Other Expense

Tax
Expense/ (Benefit)

Effective Tax Rate

Net Income

Basic EPS

Adjustments(4)

Diluted EPS

As reported

$

151,615

$

114,600

$

24,248

$

8,536

$

-

$

(30,438

)

-193.7

%

$

46,150

$

-

$

46,150

% of sales

55.1

%

41.7

%

8.8

%

EPS

$

1.51

$

1.48

Shares

30,473

630

31,103

Acquisition costs(1)

2,096

(3,706

)

5,802

-

-

35,852

(30,050

)

$

153,711

$

110,894

$

30,050

$

8,536

$

-

$

5,414

$

16,100

Adjusted gross profit %

55.9

%

Amortization(2)

$

1,500

(7,193

)

8,693

(1,488

)

-

2,484

7,697

As adjusted

$

103,701

$

38,743

$

7,048

$

-

$

7,898

24.9

%

$

23,797

$

-

$

23,797

% of sales

37.7

%

14.1

%

Adjusted Diluted EPS

$

0.77

Shares

30,473

630

31,103

Convertible notes hedges(3)

(45

)

Adjusted Diluted Shares

31,058

Three Months Ended September 30, 2021

Gross Profit

Selling &

Administrative Expense

Operating Income

Interest
Expense

Other Expense

Tax
Expense

Effective Tax Rate

Net Income

Basic EPS

Adjustments

Diluted EPS

As reported

$

142,306

$

104,736

$

26,711

$

8,145

$

1,127

$

2,491

14.3

%

$

14,948

$

-

$

14,948

% of sales

57.2

%

42.1

%

10.7

%

EPS

$

0.51

$

0.47

Shares

29,179

2,964

32,143

Loss on early extinguishment of debt(5)

-

-

-