CONMED Corporation (NASDAQ:CNMD) Q3 2017 Earnings Conference Call Transcript

Nov 02, 2017 • 04:30 pm ET

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CONMED Corporation (NASDAQ:CNMD) Q3 2017 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good day, ladies and gentlemen, and welcome to the CONMED Corporation Third Quarter 2017 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we'll have a question-and-answer session and instructions will be given at that time. (Operator Instructions) As a reminder, this conference call is being recorded.

(Forward-Looking Cautionary Statements)

You will also hear management refer to the certain non-GAAP adjusted measurements during this discussion. While these figures are not a substitute for GAAP measurements, management will use these figures to aid monitoring the company's ongoing financial performance from quarter-to-quarter and year-to-year on a regular basis and for benchmarking against other medical technology companies. Adjusted net income and adjusted earnings per share measure the income of the company, excluding credits or charges that are considered by the company to be special or outside of its normal ongoing operations. These adjusting items are specified in the reconciliation in the press release issued this afternoon.

With these required announcements completed, I will turn the call over to Curt Hartman, CONMED's President and CEO, for opening remarks. Mr. Hartman?

Executive
Curt Hartman

Thank you, Nova. Good afternoon and thank you for joining us for CONMED's third quarter 2017 earnings call. With me on the call is Luke Pomilio, CONMED's EVP and CFO. Today, I'll provide a brief overview of the financial and operating highlights for the quarter. Luke will then provide a more detailed analysis of our financial performance and an update to our fiscal 2017 financial guidance. After that, we'll open the call to your questions.

Looking at the quarter, total company sales in the third quarter were $190.1 million, an increase of 2.9% as reported, and 2.4% on a constant-currency basis. As noted on the second quarter call, we had 63 selling days this quarter versus 64 in the year-ago quarter.

Finally, while it is impossible to fully determine the impact from Hurricanes Harvey and Irma on our top line, we estimate that our domestic results experienced an impact of approximately $2 million of either deferred or lost sales in the Texas, Florida and South Carolina geographies. Approximately $800,000 of that was in domestic General Surgery, while the remaining $1.2 million was in domestic Orthopedics.

From an earnings perspective, adjusted diluted net earnings of $11.7 million increased 1.7% year-over-year, and adjusted diluted net earnings per share of $0.42 increased 2.4% year-over-year. On a worldwide basis, General Surgery recorded its seventh straight quarter of positive gains, posting 7.1% reported growth and 7% constant currency growth. While Orthopedics dipped negative owing to ongoing weakness in the domestic results during the quarter.

Overall, our international business is delivering strong results. For the quarter, top line results improved 7.3% as reported, and 6.2% in constant currency, with gains in both General Surgery and Orthopedics for the sixth consecutive quarter. International General Surgery remains strong, having now recorded its seventh consecutive quarter growth at 11.9% as reported and 11.6% on a constant-currency basis.

In international Orthopedics, gains were recorded across nearly every product category during