Owens & Minor (NYSE:OMI) shares rose today on second-quarter results that included a big three months for its Patient Direct business.
Shares of OMI ticked up 1% at $18.96 apiece in midday trading today. MassDevice’s MedTech 100 Index — which includes stocks of the world’s largest medical device companies — rose 0.2%.
The Richmond, Virginia-based company posted losses of $28.2 million in the quarter. That equals 37¢ per share on sales of $2.6 billion for the three months ended June 30, 2023.
Owens & Minor took a big hit on its bottom line, having produced profits of $28.6 million in the same period last year. However, the company recorded sales growth of 2.5%.
Adjusted to exclude one-time items, the company reported net income of $14.2 million and earnings per share totaling 18¢.
How the quarter played out for Owens & Minor
Owens & Minor’s Patient Direct business brought in $633 million in the quarter, representing 10.5% growth year-over-year. Products and Healthcare Services ($1.93 billion) remained just about flat, while Medical Distribution sales grew by 5.1%.
The company also made progress reducing working capital and managing costs as part of a realignment plan announced in February. President and CEO Edward Pesicka said the company has already begun to see financial benefits from that program.
‘The second quarter of 2023 shows a continuation of our Patient Direct segment’s exceptional performance, with another quarter of double-digit growth and strength across the major categories that we serve,” Pesicka said. “Our Products and Healthcare Services segment demonstrated resilience during the quarter with sales growth in the Medical Distribution division, but the segment experienced continued revenue headwinds in our higher margin Global Products division.
“The fluid acute care market continues to impact our Surgical & Infection Prevention (S&IP) products within the Product and Healthcare Services segment, and as a result we remain cautious for the remainder of the year. The continued strength of the Patient Direct segment, combined with overall strong operating cash flow provides flexibility to invest and strengthen our balance sheet.”
Owens & Minor cut the top end of both its revenue and adjusted EPS guidance for 2023. It now projects revenues between $10.2 billion and $10.5 billion and adjusted EPS between $1.30 and $1.55. The company previously set its ceiling at $10.6 billion in sales and $1.65 per share.