Henry Schein Inc (HSIC) Reports Q3 2023 Results and Updates Full-Year Guidance Amid Challenges
GAAP diluted EPS at $1.05, non-GAAP diluted EPS at $1.32, with total sales growth of 3.1%.
Full-year 2023 non-GAAP diluted EPS guidance narrowed to $5.18 to $5.26, reflecting macroeconomic conditions and cybersecurity incident impacts.
Global Dental sales up by 5.4%, while Global Medical sales saw a decrease of 3.1%.
Technology and Value-Added Services sales increased by 18.8%, driven by acquisitions and internal growth.
On November 13, 2023, Henry Schein Inc (NASDAQ:HSIC) released its 8-K filing, announcing third-quarter financial results and updating full-year guidance. The company, a leading provider of healthcare solutions, reported a stable net total sales growth of 3.1% for the quarter ended September 30, 2023, despite facing headwinds from softening macroeconomic conditions and a recent cybersecurity incident.
Financial Performance Overview
Henry Schein Inc (NASDAQ:HSIC) reported GAAP net income for the quarter at $137 million, translating to $1.05 per diluted share, a decrease from the third-quarter 2022 GAAP net income of $150 million, or $1.09 per diluted share. On a non-GAAP basis, net income for the quarter was $173 million, or $1.32 per diluted share, compared with third-quarter 2022 non-GAAP net income of $177 million, or $1.29 per diluted share.
The company's Global Dental sales were notable, with a 5.4% increase to $1.9 billion for the quarter, driven by strong sales growth in consumable merchandise and acquisitions. However, internally generated sales decreased slightly in local currencies. Global Medical sales experienced a decline of 3.1%, with internally generated sales decreasing by 4.6% in local currencies. Technology and Value-Added Services sales were a bright spot, increasing by 18.8% compared to the prior-year period.
Strategic Acquisitions and Capital Deployment
Henry Schein Inc (NASDAQ:HSIC) continued its strategic expansion by investing $417 million in business acquisitions during the third quarter of 2023 and $668 million year-to-date. The company also repurchased approximately 660,000 shares of its common stock at an average price of $75.79 per share, totaling $50 million.
Cybersecurity Incident and Updated Guidance
The company provided an update on the cybersecurity incident reported on October 14, 2023, which primarily affected its dental and medical distribution businesses. While significant progress has been made towards resuming normal operations, the incident is expected to impact full-year 2023 sales, now anticipated to be approximately 1% to 3% lower than full-year 2022 sales.
As a result, Henry Schein Inc (NASDAQ:HSIC) has updated its full-year 2023 non-GAAP diluted EPS guidance to $4.43 to $4.71. This reflects a narrowed guidance range for the underlying business and an estimated $0.55 to $0.75 per share business interruption impact from the cybersecurity incident, excluding any future insurance claim recovery.
Looking Ahead
Despite the challenges, Henry Schein Inc (NASDAQ:HSIC) remains confident in the stability of the dental and medical markets and is committed to its strategic priorities and long-term financial model, which includes high single-digit to low double-digit operating income growth.
For a detailed breakdown of Henry Schein Inc (NASDAQ:HSIC)'s financial results, including income statements and balance sheets, investors and interested parties are encouraged to review the full 8-K filing.
Explore the complete 8-K earnings release (here) from Henry Schein Inc for further details.
This article first appeared on GuruFocus.
