Pharmaceutical and surgical equipment manufacturer Steris Corporation (STE), Tuesday, reported a substantial rise in profit for the third quarter that also came above analysts' estimates, as modest revenue growth and improved cost efficiencies drove improved operating results.
Net income for the quarter was $41.0 million or $0.69 per share compared with net income of $28.58 million or $0.48 per share in the same quarter last year.
On average, six analysts polled by Thomson Reuters expected the company to earn $0.48 per share for the quarter. Analysts' estimates typically exclude special items.
Third quarter last year results include a $12.3 million pre-tax charge related to restructuring efforts and a $7.9 million pre-tax income related to certain benefit policies. Excluding the special items, third quarter last year net income was $31.3 million or $0.53 per share.
The Mentor, Ohio-based company's net revenues for the quarter grew 3% to $327.83 million from $319.47 million in the year-ago period. On a constant currency basis, revenues increased 1%. Four analysts expected the company to generate revenues of $309.68 million for the quarter.
Gross profit for the quarter increased to $139.48 million from $124.07 million in the same period the previous year. Operating income was $59.4 million, or 18.1% of revenues, compared with $45.8 million, or 14.3% of revenues in the third quarter of last year.
On a segmental basis, Healthcare revenues in the third quarter grew 1% to $233.3 million compared with $230.2 million in the same quarter last year driven by double-digit growth in consumable revenue, offset by low single-digit declines in capital equipment and service revenues. Life Sciences third-quarter revenues were $58.9 million, up 12% from $52.8 million in the prior-year period, helped by double-digit growth in capital equipment and consumables, offset to an extent by a decline in service revenues. Third quarter revenues from Isomedix Services grew 1% to $35.0 million from $34.6 million in the same period last year.
Walt Rosebrough, Chief Executive Officer, said, "--our performance has continued to improve throughout the fiscal year as demand for our Healthcare capital equipment has improved, and order levels seem to be stabilizing."
The company declared a regular quarterly dividend in the amount of $0.11 per common share. The dividend is payable March 23, 2010 to shareholders of record at the close of business on February 23, 2010.
STE shares are currently trading at $26.80, up $0.72 or 2.76% on a volume of 201,997 on the NYSE.
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