Hill-Rom Reports Third Quarter Financi...(s offset by the refinement of the intang...),Health

Date:8/6/2009

s offset by the refinement of the intangibles impairment charge reported last quarter, effects of severance and related expenses associated with job eliminations and other actions announced in January 2009, and Liko integration costs. There were no adjustments in the prior year quarter. Unless otherwise indicated, amounts in the current quarter include the results of Liko, acquired on October 1, 2008.

Management Comments

"Hill-Rom delivered a quarter with sales performance about where we expected, and stable with our second quarter," commented Peter H. Soderberg, president and CEO of Hill-Rom. "However, we continue to face a very conservative approach to capital spending by U.S. providers. These providers were just beginning to experience improved access to capital when the uncertainties of rapidly emerging healthcare reform struck them. In spite of this, our order trends and product trial activities are stable and quote activities continue to increase significantly. Internationally, we are seeing the weakness we anticipated in parts of Europe and in Asia; however, there are a number of countries that continue to perform well and to date have offset this weakness. Overall, we have mitigated somewhat the impact of capital spending pressures through the strategic investments we have made to diversify our business into respiratory care, bariatric and advanced wound management rental, and into health IT."

Soderberg continued, "In spite of the softness in sales, we were particularly pleased with our operating profit and cash flow performance during the quarter. Although sales declined year over year by $32 million, pre-tax income from continuing operations as adjusted actually increased nearly two million (8.6 percent) and free cash flow increased by $58 million. Our gross margins increased 120 basis points even in the face of a mix shift towards lower margin international products and a charge rela
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SOURCE Hill-Rom Holdings, Inc. Copyright©2009 PR Newswire. All rights reserved

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