Wednesday, medical products distributor PSS World Medical, Inc. (PSSI) reported an increase in third quarter earnings, helped by successful implementation of its LEAN and Save 300 programs. Revenue for the quarter declined, yet came in above Street analysts' forecast. The company also reaffirmed its outlook for 2010.
Net income for the three months ended January 1, 2010, was $17.9 million or $0.30 per share, up from $16.0 million or $0.27 per share in the corresponding period last year. On average, seven analysts polled by Thomson Reuters expected the company to report earnings of $0.29 per share for the quarter. Analysts' estimates typically exclude special items.
Net sales declined 3.2% to $502.8 million from $519.1 million in the same period last year, but came in above the $500.06 million projected by eight Street analysts. Consolidated same day sales growth was 4.8%.
Net sales for the Physician Business and Elder Care business declined by 1.2% and 7.7% respectively. Though Physician Business same day sales growth amounted 6.9%, Elder Care business same day sales declined by 0.1%.
Income from operations was $32.0 million compared with income from operations for the three months ended January 2, 2009, of $31.7 million.
The company had 61 sales days in the most recent quarter compared with 66 sales days in the third quarter of fiscal year 2009
For the nine month period, net income rose to $52.9 million, or $0.89 per share from $37.7 million, or $0.62 per share in the year-ago period. Net sales increased to $1.558 billion, from $1.483 billion in the same period last year. Net sales for the for the Physician Business and Elder Care Business increased 6.1%, and 2.4% respectively.
David M. Bronson, Executive Vice President and Chief Financial Officer, said, "Results from our operational programs, specifically LEAN and Save 300, have exceeded our expectations this year, reducing costs while maintaining full employment. Success in these areas has allowed us to continue to improve profitability even during this challenging period for revenue growth.
"Third quarter growth in profitability, along with continued management of working capital, allowed us to finance an acquisition in our Elder Care business, repurchase just under one million shares of common stock, and continue to make investments in business strategies and technologies for future growth."
Looking ahead, for the full year 2010, the company reaffirmed its increased GAAP earnings per share forecast in the range of $1.15 - $1.17. Street analysts currently expect the company to report earnings of $1.26 per share for the full year. While announcing the results for the second quarter the company lifted its outlook for fiscal 2010 to a range of $1.15 - $1.17 from previous goal of $1.05 - $1.09.
PSSI rose $0.20 or 0.91% and closed Wednesday's regular trading at $22.16.
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