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8-K - FORM 8-K - STERIS CORPd620730d8k.htm

Exhibit 99.1

STERIS CORPORATION ANNOUNCES FISCAL 2014 SECOND QUARTER RESULTS

• Solid organic revenue growth across all segments

• Acquired businesses continue to deliver as anticipated

Mentor, Ohio (October 30, 2013)—STERIS Corporation (NYSE: STE) today announced financial results for its fiscal 2014 second quarter ended September 30, 2013. As reported, fiscal 2014 second quarter revenue increased 8% to $383.8 million compared with $356.3 million in the second quarter of fiscal 2013. As reported, net income was $29.7 million, or $0.50 per diluted share, compared with net income of $40.1 million, or $0.68 per diluted share in the second quarter of fiscal 2013. Included in the financial results for the second quarter of fiscal 2013 was a $21.5 million pre-tax benefit related to the SYSTEM 1 Rebate Program liability, which has been excluded in the adjusted results provided below.

Adjusted Results

On an adjusted basis, revenue for the second quarter of fiscal 2014 increased 14% compared with adjusted revenue of $335.9 million in the second quarter of fiscal 2013. Adjusted net income for the second quarter of fiscal 2014 was $32.6 million, or $0.55 per diluted share, compared with adjusted net income of $30.9 million, or $0.53 per diluted share in the prior year. Please refer to the attached schedules for additional information, including reconciliations of adjusted “non-GAAP financial measures” to reported results.

“We are pleased that our performance returned to expectations this quarter, reflecting the continued growth in our end-markets and success with new products,” said Walt Rosebrough, President and Chief Executive Officer of STERIS. “With solid organic growth across all segments and strong backlog, we have confidence in our ability to produce a strong second half of the year. Due largely to the timing of investments for our in-sourcing projects, we now anticipate that earnings will be in the lower half of our previously provided range of $2.47 to $2.60 for the full fiscal year.”

Segment Results

As reported, Healthcare revenue in the quarter was $277.3 million compared with $256.8 million in the second quarter of fiscal 2013. Excluding the impact of the SYSTEM 1 Rebate Program, adjusted Healthcare revenue increased by 17% during the second quarter. Contributing to revenue growth for the quarter, consumable revenue increased 26% and service revenue grew 34%, both driven by recent acquisitions and low-single digit organic growth. Capital equipment revenue grew 3% with growth in


STERIS Corporation

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both infection prevention and surgical solutions. As reported, segment operating income was $25.9 million compared with $42.1 million in last year’s second quarter. Adjusted segment operating income increased 14% to $30.3 million in the second quarter of fiscal 2014 compared with $26.7 million in the same period last year. The increase in adjusted segment operating income year-over-year was primarily driven by acquisitions and increased volume, somewhat offset by the Medical Device Excise Tax, increased spending for research and development, and investments in in-sourcing.

Life Sciences second quarter revenue increased 7% to $58.4 million compared with $54.6 million in the second quarter of fiscal 2013. Contributing to the quarter, capital equipment revenue increased 13%, consumable revenue grew 8% and service revenue was flat. Life Sciences operating income was $14.0 million compared with $10.5 million in the same period last year. The improvement in operating income is primarily attributable to improved gross margins, mainly due to favorable product mix, and improved operating leverage.

Fiscal 2014 second quarter revenue for Isomedix Services increased 7% to $47.4 million compared with $44.3 million in the second quarter of fiscal 2013. Revenue benefited from increased volumes from core medical device Customers. Operating income increased to $13.7 million in the quarter compared with $12.7 million in the second quarter of last year, primarily due to the increased volume.

Cash Flow

Net cash provided by operations for the first six months of fiscal 2014 was $80.0 million, compared with $112.0 million in the same period last year. Free cash flow (see note 1) for the first half of fiscal 2014 was $32.9 million, compared with $67.0 million in the first half of last year. The decline in free cash flow is primarily due to payments for the Company’s annual incentive compensation program which did not occur in fiscal 2013, as well as the impact of strong working capital improvements in the prior year.

Dividend Announcement

The Company also announced today that STERIS’s Board of Directors has authorized a quarterly dividend of $0.21 per common share. The dividend is payable December 18, 2013 to shareholders of record at the close of business on November 20, 2013.

 

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STERIS Corporation

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Outlook

Based upon current trends and performance year-to-date, the Company’s outlook for revenue is unchanged at 8-10% growth for fiscal 2014 when compared with adjusted revenue in fiscal 2013. Adjusted earnings per diluted share are now anticipated to be in the lower half of the previously provided range of $2.47 to $2.60 for the full fiscal year. This outlook reflects certain key assumptions, some of which are listed below:

 

   

Healthcare segment revenue is expected to grow low-double digits.

 

   

Life Sciences segment revenue is expected to grow mid-single digits.

 

   

Isomedix segment revenue is expected to grow mid-single digits.

 

   

The Company has assumed the average forward exchange rates for the U.S. dollar and key international currencies as of September 30, 2013.

 

   

Adjusted EBIT as a percent of revenue is anticipated to be approximately 15.5%.

 

   

The adjusted effective tax rate is anticipated to be in the range of 34-35%.

For the full fiscal year 2014, free cash flow (see note 1) is now anticipated to be approximately $130 million, compared with prior expectations of $145 million. The change in free cash flow expectations is primarily due to increased working capital requirements. The Company’s expectations for capital expenditures are unchanged at approximately $90 million, as the Company is continuing to invest in projects within its facilities that are designed to improve quality, reduce cost and add value to the current product offering.

Conference Call

In conjunction with this release, STERIS Corporation management will host a conference call today at 10:00 a.m. Eastern time. The conference call can be heard live over the Internet at www.steris-ir.com or via phone by dialing 1- 800-369-8428 in the United States and Canada, and 1-773-799-3378 internationally, then referencing the password “STERIS”.

 

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STERIS Corporation

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For those unable to listen to the conference call live, a replay will be available beginning at 12:00 p.m. Eastern time today, either over the Internet at www.steris-ir.com or via phone by calling 1- 800-677-9149 in the United States and Canada, or 1- 203-369-3408 internationally.

About STERIS

The mission of STERIS Corporation is to provide a healthier today and safer tomorrow through knowledgeable people and innovative infection prevention, decontamination and health science technologies, products and services. The Company has approximately 6,000 dedicated employees around the world working together to supply a broad array of solutions by offering a combination of equipment, consumables and services to healthcare, pharmaceutical, industrial and government Customers. The Company is listed on the New York Stock Exchange under the symbol STE. For more information, visit www.steris.com.

(1) Free cash flow is a non-GAAP number used by the Company as a measure to gauge its ability to fund future principal debt repayments and growth outside of core operations, repurchase common shares, and pay cash dividends. STERIS defines free cash flow as net cash flows from operating activities less purchases of property, plant, equipment and intangibles plus proceeds from the sale of property, plant, equipment and intangibles. STERIS’s calculation of free cash flow may vary from other companies. Please see the attached financial tables for a complete reconciliation of these non-GAAP numbers to the nearest GAAP information.

# # #

This press release and the referenced conference call may contain statements concerning certain trends, expectations, forecasts, estimates, or other forward-looking information affecting or relating to the Company or its industry, products or activities that are intended to qualify for the protections afforded “forward-looking statements” under the Private Securities Litigation Reform Act of 1995 and other laws and regulations. Forward-looking statements speak only as to the date of this press release, and may be identified by the use of forward-looking terms such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “projects,” “targets,” “forecasts,” “outlook,” “impact,” “potential,” “confidence,” “improve,” “optimistic,” “deliver,” “comfortable,” “trend”, and “seeks,” or the negative of such terms or other variations on such terms or comparable terminology. Many important factors could cause actual results to differ materially from those in the forward-looking statements including, without limitation, disruption of production or supplies, changes in market conditions, political events, pending or future claims or litigation, competitive factors, technology advances, actions of regulatory agencies, and changes in laws, government regulations, labeling or product approvals or the application or interpretation thereof. Other risk factors are described herein and in the Company’s Form 10-K and other securities filings. Many of these important factors are outside STERIS’s control. No assurances can be provided as to any result or the timing of any outcome regarding matters described in this press release, the referenced conference call or otherwise with respect to any regulatory action, administrative proceedings, government investigations, litigation, warning letters, consent decree, rebate program,

 

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STERIS Corporation

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transition, cost reductions, business strategies, earnings or revenue trends or future financial results. References to products, the consent decree, the transition or rebate program, or the class action settlement, are summaries only and should not be considered the specific terms of the decree, settlement, program or product clearance or literature. Unless legally required, the Company does not undertake to update or revise any forward-looking statements even if events make clear that any projected results, express or implied, will not be realized. Other potential risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements include, without limitation, (a) the potential for increased pressure on pricing or costs that leads to erosion of profit margins, (b) the possibility that market demand will not develop for new technologies, products or applications or business initiatives will take longer, cost more or produce lower benefits than anticipated, (c) the possibility that application of or compliance with laws, court rulings, certifications, regulations, regulatory actions, including without limitation those relating to FDA warning notices or letters, government investigations, the April 20, 2010 consent decree, the outcome of any pending FDA requests, inspections or submissions, or other requirements or standards may delay, limit or prevent new product introductions, affect the production and marketing of existing products or services or otherwise affect Company performance, results, prospects or value, (d) the potential of international unrest, economic downturn or effects of currencies, tax assessments, adjustments, or anticipated rates, raw material costs or availability, benefit or retirement plan costs, or other regulatory compliance costs, (e) the possibility of reduced demand, or reductions in the rate of growth in demand, for the Company’s products and services, (f) the possibility that anticipated growth, cost savings, new product acceptance, performance or approvals, or other results may not be achieved, or that transition, labor, competition, timing, execution, regulatory, governmental, or other issues or risks associated with our business, industry or initiatives including, without limitation, the consent decree, the transition from the SYSTEM 1 processing system and adjustments to related reserves, or those matters described in our Form 10-K for the year ended March 31, 2012 and other securities filings, may adversely impact Company performance, results, prospects or value, (g) the possibility that anticipated financial results or benefits of recent acquisitions will not be realized or will be other than anticipated, (h) the effect of the contraction in credit availability, as well as the ability of our Customers and suppliers to adequately access the credit markets when needed, and (i) those risks described in our securities filings including our Annual Report on Form 10-K for the year ended March 31, 2013, and other securities filings.

Contact: Julie Winter, Director, Investor Relations at 440-392-7245.

 

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STERIS Corporation

Consolidated Condensed Statements of Operations

(In thousands, except per share data)

 

     Three Months Ended     Six Months Ended  
     September 30,     September 30,  
     2013      2012     2013      2012  
     (Unaudited)      (Unaudited)     (Unaudited)      (Unaudited)  

Revenues

   $ 383,762       $ 335,921      $ 751,414       $ 672,881   

SYSTEM 1 Rebate Program

     —           20,400        —           20,400   
  

 

 

    

 

 

   

 

 

    

 

 

 

Revenues, net

     383,762         356,321        751,414         693,281   

Cost of revenues

     229,256         204,300        450,062         404,008   

Cost of revenues - SYSTEM 1 Rebate Program

     —           (1,100     —           (1,100
  

 

 

    

 

 

   

 

 

    

 

 

 

Gross profit

     154,506         153,121        301,352         290,373   

Operating expenses:

          

Selling, general, and administrative

     90,661         81,040        184,590         160,814   

Research and development

     13,527         9,852        25,380         19,164   

Restructuring expense

     18         (48     70         (184
  

 

 

    

 

 

   

 

 

    

 

 

 

Total operating expenses

     104,206         90,844        210,040         179,794   
  

 

 

    

 

 

   

 

 

    

 

 

 

Income from operations

     50,300         62,277        91,312         110,579   

Non-operating expense, net

     4,642         3,375        9,381         6,088   

Income tax expense

     15,915         18,757        19,871         33,992   
  

 

 

    

 

 

   

 

 

    

 

 

 

Net income

   $ 29,743       $ 40,145      $ 62,060       $ 70,499   
  

 

 

    

 

 

   

 

 

    

 

 

 

Earnings per common share (EPS) data:

          

Basic

   $ 0.50       $ 0.69      $ 1.05       $ 1.21   
  

 

 

    

 

 

   

 

 

    

 

 

 

Diluted

   $ 0.50       $ 0.68      $ 1.04       $ 1.20   
  

 

 

    

 

 

   

 

 

    

 

 

 

Cash dividends declared per common share outstanding

   $ 0.21       $ 0.19      $ 0.40       $ 0.36   

Weighted average number of common shares outstanding used in EPS computation:

          

Basic number of common shares outstanding

     59,027         58,264        59,016         58,088   

Diluted number of common shares outstanding

     59,762         58,792        59,776         58,552   

STERIS Corporation

Consolidated Condensed Balance Sheets

(In thousands)

 

     September 30,      March 31,  
     2013      2013  
     (Unaudited)         

Assets

     

Current assets:

     

Cash and cash equivalents

   $ 163,794       $ 142,008   

Accounts receivable, net

     260,379         275,937   

Inventories, net

     155,661         144,443   

Other current assets

     50,864         51,552   
  

 

 

    

 

 

 

Total Current Assets

     630,698         613,940   

Property, plant, and equipment, net

     448,199         431,952   

Goodwill and intangible assets, net

     698,996         704,424   

Other assets

     10,609         10,793   
  

 

 

    

 

 

 

Total Assets

   $ 1,788,502       $ 1,761,109   
  

 

 

    

 

 

 

Liabilities and Equity

     

Current liabilities:

     

Accounts payable

   $ 82,148       $ 79,374   

Other current liabilities

     115,335         139,463   
  

 

 

    

 

 

 

Total Current Liabilities

     197,483         218,837   

Long-term debt

     508,520         492,290   

Other liabilities

     91,218         103,002   

Equity

     991,281         946,980   
  

 

 

    

 

 

 

Total Liabilities and Equity

   $ 1,788,502       $ 1,761,109   
  

 

 

    

 

 

 


STERIS Corporation

Segment Data

(In thousands)

 

     Three Months Ended      Six Months Ended  
     September 30,      September 30,  
     2013      2012      2013      2012  
     (Unaudited)      (Unaudited)      (Unaudited)      (Unaudited)  

Segment Revenues:

           

Healthcare

   $ 277,332       $ 236,420       $ 536,220       $ 465,934   

SYSTEM 1 Rebate Program

     —           20,400         —           20,400   
  

 

 

    

 

 

    

 

 

    

 

 

 

Healthcare, net

     277,332         256,820         536,220         486,334   

Life Sciences

     58,382         54,577         118,297         115,073   

STERIS Isomedix Services

     47,411         44,284         95,635         90,340   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total Reportable Segments

     383,125         355,681         750,152         691,747   

Corporate and Other

     637         640         1,262         1,534   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total Segment Revenues

   $ 383,762       $ 356,321       $ 751,414       $ 693,281   
  

 

 

    

 

 

    

 

 

    

 

 

 

 

     Three Months Ended     Six Months Ended  
     September 30,     September 30,  
     2013     2012     2013     2012  
     (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  

Segment Operating Income:

        

Healthcare

   $ 25,926      $ 42,147      $ 40,873      $ 64,877   

Life Sciences

     14,041        10,549        26,580        22,403   

STERIS Isomedix Services

     13,712        12,667        28,430        28,245   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Reportable Segments

     53,679        65,363        95,883        115,525   

Corporate and Other

     (3,379     (3,086     (4,571     (4,946
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Operating Income

   $ 50,300      $ 62,277      $ 91,312      $ 110,579   
  

 

 

   

 

 

   

 

 

   

 

 

 


STERIS Corporation

Consolidated Condensed Statements of Cash Flows

(In thousands)

 

     Six Months Ended  
     September 30,  
     2013     2012  
     (Unaudited)     (Unaudited)  

Operating Activities:

    

Net income

   $ 62,060      $ 70,499   

Non-cash items

     45,163        44,395   

Change in Accrued SYSTEM 1 Rebate Program and class action settlement

     (248     (42,619

Changes in operating assets and liabilities

     (26,930     39,748   
  

 

 

   

 

 

 

Net cash provided by operating activities

     80,045        112,023   

Investing Activities:

    

Purchases of property, plant, equipment, and intangibles, net

     (47,110     (45,062

Proceeds from sale of property, plant, equipment and intangibles

     8        22   

Investments in businesses, net of cash acquired

     (115     (276,595
  

 

 

   

 

 

 

Net cash used in investing activities

     (47,217     (321,635

Financing Activities:

    

Payments on long-term obligations, net

     (30,000     —     

Proceeds under credit facilities, net

     46,230        224,340   

Deferred financing fees and debt issuance costs

     (43     —     

Repurchases of common shares

     (18,653     (2,688

Cash dividends paid to common shareholders

     (23,644     (20,946

Stock option and other equity transactions, net

     9,159        11,709   

Tax benefit from stock options exercised

     1,462        1,772   
  

 

 

   

 

 

 

Net cash provided by and used in financing activities

     (15,489     214,187   

Effect of exchange rate changes on cash and cash equivalents

     4,447        1,213   
  

 

 

   

 

 

 

Decrease in cash and cash equivalents

     21,786        5,788   

Cash and cash equivalents at beginning of period

     142,008        150,821   
  

 

 

   

 

 

 

Cash and cash equivalents at end of period

   $ 163,794      $ 156,609   
  

 

 

   

 

 

 

The following table presents a financial measure which is considered to be “non-GAAP financial measures” under Securities Exchange Commission rules. Free cash flow is defined by the Company as cash flows from operating activities less purchases of property, plant, equipment and intangibles, net (capital expenditures) plus proceeds from the sale of property, plant, equipment and intangibles. The Company uses free cash flow as a measure to gauge its ability to fund future principal debt repayments and growth outside of core operations, repurchase common shares, and pay cash dividends. STERIS’s calculation of free cash flow may vary from other companies.

 

     Six Months Ended  
     September 30,  
     2013     2012  
     (Unaudited)     (Unaudited)  

Calculation of Free Cash Flow:

    

Cash flows from operating activities

   $ 80,045      $ 112,023   

Purchases of property, plant, equipment, and intangibles, net

     (47,110     (45,062

Proceeds from the sale of property, plant, equipment, and intangibles

     8        22   
  

 

 

   

 

 

 

Free Cash Flow

   $ 32,943      $ 66,983   
  

 

 

   

 

 

 

 

     Twelve Months Ended  
     March 31,  
     2014  
     (Outlook)  

Calculation of free cash flow for outlook:

  

Cash flows from operating activities

   $ 220,000   

Purchases of property, plant, equipment, and intangibles, net

     (90,000
  

 

 

 

Free Cash Flow

   $ 130,000   
  

 

 

 


STERIS Corporation

Non-GAAP Earnings Per Share and Outlook

The Company has referred to an adjusted financial measure regarding the results of operations excluding certain items to provide meaningful comparative analysis between the periods. This financial measure is considered to be a “non-GAAP financial measure” under Securities Exchange Commission rules. Reconciliation of the financial measure to its nearest GAAP financial measure is provided in the table below.

 

     Three months ended
September 30,
    Six months ended
September 30,
 
     2013      2012     2013     2012  
     (Unaudited)      (Unaudited)     (Unaudited)     (Unaudited)  

Net Income per diluted share

   $ 0.50       $ 0.68      $ 1.04      $ 1.20   

Impact of SYSTEM 1 Rebate Program and class action settlement, net of tax

     —           (0.22     —          (0.22

Tax benefit, European restructuring

     —           —          (0.15     —     

Inventory “step up” to fair value, net of tax

     —           0.01        —          0.01   

Amortization and impairment of purchased intangible assets, net of tax

     0.04         0.02        0.08        0.03   

Acquisition related transaction and integration expenses, net of tax

     0.01         0.04        0.01        0.04   
  

 

 

    

 

 

   

 

 

   

 

 

 

Adjusted net income per diluted share

   $ 0.55       $ 0.53      $ 0.98      $ 1.06   
  

 

 

    

 

 

   

 

 

   

 

 

 

 

     Twelve months ended
March 31,

2014
 
     (Outlook)*  

Net Income per diluted share

   $ 2.42 - $2.55   

Tax benefit, European restructuring

     (0.15

Amortization and impairment of purchased intangible assets, net of tax

     0.18   

Acquisition related transaction and integration expenses, net of tax

     0.02   
  

 

 

 

Adjusted net income per diluted share

   $ 2.47 - $2.60   
  

 

 

 

 

* All amounts are estimates.


STERIS Corporation

Non-GAAP Financial Measures

(In thousands, except per share data)

The Company has referred to certain adjusted financial measures regarding the results of operations excluding certain items to provide meaningful comparative analysis between the periods. These financial measures are considered to be “non-GAAP financial measure” under Securities Exchange Commission rules. Reconciliation of each financial measure to its nearest GAAP financial measure is provided in the table below.

 

     Three months ended     Six months ended  
     September 30,     September 30,  
     2013      2012     2013     2012  
     (Unaudited)      (Unaudited)     (Unaudited)     (Unaudited)  

Revenues

   $ 383,762       $ 356,321      $ 751,414      $ 693,281   

Impact of SYSTEM 1 Rebate Program

     —           (20,400     —          (20,400
  

 

 

    

 

 

   

 

 

   

 

 

 

Adjusted revenues

   $ 383,762       $ 335,921      $ 751,414      $ 672,881   
  

 

 

    

 

 

   

 

 

   

 

 

 

Gross Profit

   $ 154,506       $ 153,121      $ 301,352      $ 290,373   

Impact of SYSTEM 1 Rebate Program

     —           (21,500     —          (21,500

Amortization of inventory “step up” to fair value

     —           747        —          846   

Restructuring

     —           —          —          —     
  

 

 

    

 

 

   

 

 

   

 

 

 

Adjusted gross profit

   $ 154,506       $ 132,368      $ 301,352      $ 269,719   
  

 

 

    

 

 

   

 

 

   

 

 

 

Operating income

   $ 50,300       $ 62,277      $ 91,312      $ 110,579   

Impact of SYSTEM 1 Rebate Program

     —           (21,500     —          (21,500

Amortization of inventory “step up” to fair value

     —           747        —          846   

Amortization and impairment of purchased intangible assets

     4,067         2,256        8,357        3,281   

Acquisition related transaction and integration costs

     633         3,448        1,341        3,555   

Restructuring

     18         (48     70        (184
  

 

 

    

 

 

   

 

 

   

 

 

 

Adjusted operating income

   $ 55,018       $ 47,180      $ 101,080      $ 96,577   
  

 

 

    

 

 

   

 

 

   

 

 

 

Net income

   $ 29,743       $ 40,145      $ 62,060      $ 70,499   

Impact of SYSTEM 1 Rebate Program, net of tax

     —           (13,115     —          (13,115

Amortization of inventory “step up” to fair value, net of tax

     —           456        —          516   

Amortization and impairment of purchased intangible assets, net of tax

     2,481         1,376        5,098        2,001   

Acquisition related transaction and integration costs

     386         2,103        818        2,169   

Tax benefit, European restructuring

     —           —          (9,245     —     

Restructuring, net of tax

     11         (30     43        (112
  

 

 

    

 

 

   

 

 

   

 

 

 

Adjusted net income

   $ 32,621       $ 30,935      $ 58,774      $ 61,958   
  

 

 

    

 

 

   

 

 

   

 

 

 

Healthcare revenues

   $ 277,332       $ 256,820      $ 536,220      $ 486,334   

Impact of SYSTEM 1 Rebate Program

     —           (20,400     —          (20,400
  

 

 

    

 

 

   

 

 

   

 

 

 

Adjusted Healthcare revenues

   $ 277,332       $ 236,420      $ 536,220      $ 465,934   
  

 

 

    

 

 

   

 

 

   

 

 

 

Healthcare capital revenues

   $ 116,331       $ 132,936      $ 218,005      $ 247,369   

Impact of SYSTEM 1 Rebate Program

     —           (20,400     —          (20,400
  

 

 

    

 

 

   

 

 

   

 

 

 

Adjusted Healthcare capital revenues

   $ 116,331       $ 112,536      $ 218,005      $ 226,969   
  

 

 

    

 

 

   

 

 

   

 

 

 

Healthcare operating income

   $ 25,926       $ 42,147      $ 40,873      $ 64,877   

Impact of SYSTEM 1 Rebate Program

     —           (21,500     —          (21,500

Amortization of inventory “step up” to fair value

     —           747        —          846   

Amortization and impairment of purchased intangible assets

     3,728         1,859        7,675        2,484   

Acquisition related transaction and integration costs

     633         3,448        1,341        3,555   

Restructuring

     18         (48     70        (184
  

 

 

    

 

 

   

 

 

   

 

 

 

Adjusted healthcare operating income

   $ 30,305       $ 26,653      $ 49,959      $ 50,078   
  

 

 

    

 

 

   

 

 

   

 

 

 

Capital revenues

   $ 135,303       $ 149,676      $ 259,197      $ 288,094   

Impact of SYSTEM 1 Rebate Program

     —           (20,400     —          (20,400
  

 

 

    

 

 

   

 

 

   

 

 

 

Adjusted capital revenues

   $ 135,303       $ 129,276      $ 259,197      $ 267,694   
  

 

 

    

 

 

   

 

 

   

 

 

 

United States revenues

   $ 297,650       $ 271,788      $ 586,003      $ 534,192   

Impact of SYSTEM 1 Rebate Program

     —           (20,400     —          (20,400
  

 

 

    

 

 

   

 

 

   

 

 

 

Adjusted United States revenues

   $ 297,650       $ 251,388      $ 586,003      $ 513,792   
  

 

 

    

 

 

   

 

 

   

 

 

 


STERIS Corporation

Unaudited Supplemental Financial Data

Second Quarter Fiscal 2014

As of September 30, 2013

 

     FY 2014     FY 2013     FY 2014     FY 2013  

Total Company Revenues

   Q2     Q2     YTD     YTD  

Capital

   $ 135,303      $ 149,676      $ 259,197      $ 288,094   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted capital revenues (1)

     135,303        129,276        259,197      $ 267,694   

Consumables

     100,006        81,974        199,040        157,309   

Service

     148,453        124,671        293,177        247,878   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Recurring

     248,459        206,645        492,217        405,187   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Revenues

   $ 383,762      $ 356,321      $ 751,414      $ 693,281   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted total revenues (1)

   $ 383,762      $ 335,921      $ 751,414      $ 672,881   
  

 

 

   

 

 

   

 

 

   

 

 

 

United States Revenues

   $ 297,650      $ 271,788      $ 586,003      $ 534,192   

Adjusted United States Revenues (1)

     297,650        251,388        586,003        513,792   

United States Revenues as a % of Total

     78     75     78     76

International Revenues

   $ 86,112      $ 84,533      $ 165,411      $ 159,089   

International Revenues as a % of Total

     22     25     22     24

Segment Data

   Q2     Q2     YTD     YTD  

Healthcare

        

Revenues

        

Capital

   $ 116,331      $ 132,936      $ 218,005      $ 247,369   

Adjusted Capital (1)

   $ 116,331      $ 112,536      $ 218,005      $ 226,969   

Consumables

     79,938        63,422        158,501        119,754   

Service

     81,063        60,462        159,714        119,211   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Recurring

     161,001        123,884        318,215        238,965   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Healthcare Revenues

   $ 277,332      $ 256,820      $ 536,220      $ 486,334   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Total Healthcare Revenues (1)

   $ 277,332      $ 236,420      $ 536,220      $ 465,934   

Operating Income

     25,926        42,147        40,873        64,877   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted Operating Income (1)

     30,305        26,653        49,959        50,078   

Life Sciences

        

Revenues

        

Capital

   $ 18,972      $ 16,740      $ 41,192      $ 40,725   

Consumables

     20,068        18,552        40,539        37,555   

Service

     19,342        19,285        36,566        36,793   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Recurring

     39,410        37,837        77,105        74,348   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Life Sciences Revenues

   $ 58,382      $ 54,577      $ 118,297      $ 115,073   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating Income

     14,041        10,549        26,580        22,403   
  

 

 

   

 

 

   

 

 

   

 

 

 

Isomedix Services

        

Revenues

   $ 47,411      $ 44,284      $ 95,635      $ 90,340   

Operating Income

     13,712        12,667        28,430        28,245   
  

 

 

   

 

 

   

 

 

   

 

 

 

Corporate and Other

        

Revenues

   $ 637      $ 640      $ 1,262      $ 1,534   

Operating Income (Loss)

     (3,379     (3,086     (4,571     (4,946

Other Data

   Q2     Q2     YTD     YTD  

Healthcare Backlog

   $ 133,375      $ 119,249      $ 133,375      $ 119,249   

Life Sciences Backlog

     47,813        50,573        47,813        50,573   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Backlog

   $ 181,188      $ 169,822      $ 181,188      $ 169,822   

Free Cash Flow

   $ 21,979      $ 21,241      $ 32,943      $ 66,983   

Net Debt

   $ 344,726      $ 277,731      $ 344,726      $ 277,731   

 

(1) The Company has referred to certain adjusted financial measures regarding the results of operations excluding certain items to provide meaningful comparative analysis between the periods. These financial measures are considered to be “non-GAAP financial measure” under Securities Exchange Commission rules. Reconciliation of each financial measure to its nearest GAAP financial measure is provided in the table below.

This supplemental data is consistent with publicly disclosed information provided in quarterly conference calls, earnings releases and SEC filings, and is subject to all definitions, precautions and limitations contained in those disclosures. Please see the Company’s most recent 10-K for definitions (and reconciliation where appropriate) of adjusted measures, backlog, free cash flow and net debt.