Navigation Links
Zimmer Holdings, Inc. Reports Third Quarter 2011 Financial Results
Date:10/27/2011

WARSAW, Ind., Oct. 27, 2011 /PRNewswire/ -- Zimmer Holdings, Inc. (NYSE and SIX: ZMH) today reported financial results for the quarter ended September 30, 2011.  The Company reported third quarter net sales of $1,031 million, an increase of 6.9% reported and 2.4% constant currency over the third quarter of 2010.  Diluted earnings per share for the quarter were $1.01 reported and $1.04 adjusted, an increase of 8.3% adjusted over the prior year period.

"Zimmer delivered against our financial commitments in the third quarter with consistent results in both revenues and earnings," said David Dvorak, Zimmer President and CEO.  "Progress in the commercialization of new products supported a strong performance in many international markets.  Through this progress and ongoing financial discipline, we continue to deliver value to stockholders."  

Net earnings for the third quarter were $191.5 million on a reported basis and $197.2 million on an adjusted basis, an increase of 2.4% adjusted over the prior year period.  Operating cash flow for the third quarter was $350.6 million.  

During the quarter, the Company utilized $549 million of cash, supported by $375 million of borrowings, to acquire 10.1 million shares.  At the end of the third quarter, $299 million of share repurchase authorization remained available under the current program, which expires on December 31, 2013.

Guidance  The Company updated its full-year revenue and adjusted earnings per share guidance for 2011.  Full-year revenues for 2011 are now expected to increase between 2.3% and 2.7% on a constant currency basis from 2010.  The Company estimates that foreign currency translation will increase revenues by approximately 2.5% for the full year 2011, resulting in reported revenue growth between 4.8% and 5.2%.  This compares with prior revenue guidance of 2.5% to 3.5% constant currency and 5.5% to 6.5% reported growth over prior year.  Full-year 2011 diluted earnings per share are now projected to be in a range of $4.40 to $4.45 on a reported basis and $4.75 to $4.80 on an adjusted basis, which represents a narrowing toward the top end of prior adjusted earnings guidance.

Conference CallThe Company will conduct its third quarter 2011 investor conference call today, October 27, 2011, at 8:00 a.m. Eastern Time.  The live audio webcast can be accessed via Zimmer's Investor Relations website at http://investor.zimmer.com.  It will be archived for replay following the conference.

Individuals who wish to dial into the conference call may do so at (888) 878-3901.  International callers should dial (706) 634-9520.  A digital recording will be available two hours after the completion of the conference call from October 27, 2011, to November 10, 2011.  To access the recording, US/Canada callers should dial (800) 642-1687, or for International callers, dial (706) 645-9291, and enter the conference ID 12302169.

Sales TablesThe following tables provide sales results by geographic segment and product category, as well as the percentage change compared to the prior year quarter and nine months on both a reported and constant currency basis. NET SALES - THREE MONTHS ENDED SEPTEMBER 30, 2011(in millions, unaudited)ConstantNetReportedCurrencySales % Growth% GrowthGeographic Segments   Americas

$

582-

%(1)

%   Europe252177   Asia Pacific197197Total1,03172Product CategoriesReconstructive   Americas422(2)(2)   Europe199177   Asia Pacific147218Total76861Knees   Americas253(4)(4)   Europe90167   Asia Pacific74197Total4173-Hips   Americas142--   Europe103186   Asia Pacific702311Total315104Extremities3674Dental55129Trauma691914Spine55(2)(5)Surgical and other8484NET SALES - NINE MONTHS ENDED SEPTEMBER 30, 2011(in millions, unaudited)ConstantNetReportedCurrencySales % Growth% GrowthGeographic Segments   Americas

$

1,8201

%-

%   Europe876135   Asia Pacific588187Total3,28463Product CategoriesReconstructive   Americas1,337(1)(1)   Europe694114   Asia Pacific436186Total2,46751Knees   Americas797(4)(4)   Europe335136   Asia Pacific218153Total1,3503(1)Hips   Americas44822   Europe340102   Asia Pacific210219Total99883Extremities11996Dental1851815Trauma2081814Spine168(3)(6)Surgical and other256106About the CompanyFounded in 1927 and headquartered in Warsaw, Indiana, Zimmer designs, develops, manufactures and markets orthopaedic reconstructive, spinal and trauma devices, dental implants, and related surgical products.  Zimmer has operations in more than 25 countries around the world and sells products in more than 100 countries.  Zimmer's 2010 sales were approximately $4.2 billion.  The Company is supported by the efforts of more than 8,000 employees worldwide.

Website InformationWe routinely post important information for investors on our website, www.zimmer.com, in the "Investor Relations" section. We intend to use this website as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD. Accordingly, investors should monitor the Investor Relations section of our website, in addition to following our press releases, SEC filings, public conference calls, presentations and webcasts. The information contained on, or that may be accessed through, our website is not incorporated by reference into, and is not a part of, this document.

Note on Non-GAAP Financial Measures As used in this press release, the term "adjusted" refers to operating performance measures that exclude inventory step-up, the provision for certain Durom® Acetabular Component product claims, special items and certain tax adjustments.  Included in special items are acquisition and integration costs as well as employee termination benefits, certain contract terminations and asset impairment charges connected with global restructuring and transformation initiatives.  The term "constant currency" refers to any financial measure that excludes the effect of changes in foreign currency exchange rates.  Reconciliations of these non-GAAP measures to the most directly comparable GAAP measure are included in this press release.

Zimmer Safe Harbor StatementThis press release contains forward-looking statements within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 based on current expectations, estimates, forecasts and projections about the orthopaedics industry, management's beliefs and assumptions made by management. Forward-looking statements may be identified by the use of forward-looking terms such as "may," "will," "expects," "believes," "anticipates," "plans," "estimates," "projects," "assumes," "guides," "targets," "forecasts," and "seeks" or the negative of such terms or other variations on such terms or comparable terminology. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that could cause actual outcomes and results to differ materially. These risks and uncertainties include, but are not limited to, our compliance with the Corporate Integrity Agreement through 2012; the success of our quality and operational improvement initiatives; the outcome of the investigation by the U.S. government into Foreign Corrupt Practices Act matters announced in October 2007; price and product competition; changes in customer demand for our products and services caused by demographic changes or other factors; dependence on new product development, technological advances and innovation; shifts in the product category or regional sales mix of our products and services; supply and prices of raw materials and products; control of costs and expenses; our ability to obtain and maintain adequate intellectual property protection; our ability to successfully integrate acquired businesses; our ability to form and implement alliances; challenges relating to changes in and compliance with governmental laws and regulations affecting our U.S. and international businesses, including regulations of the U.S. Food and Drug Administration and foreign government regulators; changes in tax obligations arising from tax reform measures or examinations by tax authorities; product liability and intellectual property litigation losses; the impact of health care reform measures in the U.S. including the impact of the new excise tax on medical devices, reductions in reimbursement levels from third-party payors and cost-containment efforts of health care purchasing organizations; our ability to retain the independent agents and distributors who market our products; and changes in general industry and market conditions, including domestic and international growth rates and general domestic and international economic conditions, including interest rate and currency exchange rate fluctuations. For a further list and description of such risks and uncertainties, see our periodic reports filed with the U.S. Securities and Exchange Commission. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be set forth in our periodic reports. Readers of this document are cautioned not to place undue reliance on these forward-looking statements, since, while we believe the assumptions on which the forward-looking statements are based are reasonable, there can be no assurance that these forward-looking statements will prove to be accurate. This cautionary statement is applicable to all forward-looking statements contained in this document.

ZIMMER HOLDINGS, INC. CONSOLIDATED STATEMENTS OF EARNINGS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2011 and 2010 (in millions, except per share amounts, unaudited) 20112010% Inc/(Dec) Net Sales $ 1,031.5$ 965.07

% Cost of products sold

251.9219.115 Gross Profit 779.6745.95 Research and development

61.057.37 Selling, general and administrative

444.0412.08 Certain claims

--- Special items

8.05.063Operating expenses

513.0474.38 Operating Profit 266.6271.6(2) Interest expense, net

11.714.2(17) Earnings before income taxes  

254.9257.4(1) Provision for income taxes

63.766.3(4) Net earnings

191.2191.1- Less:  Net loss attributable to noncontrolling interest

(0.3)-100 Net Earnings of Zimmer Holdings, Inc. $
91.5
$ 191.1- Earnings Per Common Share Basic

$
.02$   0.966Diluted

$
.01$   0.965 Weighted Average Common Shares Outstanding Basic

187.7198.7Diluted

188.8199.7 Certain amounts in the 2010 consolidated statement of earnings have been reclassified to conform to the 2011 presentation. ZIMMER HOLDINGS, INC. CONSOLIDATED STATEMENTS OF EARNINGS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 and 2010 (in millions, except per share amounts, unaudited) 20112010% Inc/(Dec) Net Sales $ 3,284.5$ 3,085.56

% Cost of products sold

818.8738.111 Gross Profit 2,465.72,347.45 Research and development

173.6162.07 Selling, general and administrative

1,372.21,297.56 Certain claims

50.075.0(33) Special items

47.019.1147Operating expenses

1,642.81,553.66 Operating Profit 822.9793.84 Interest expense, net

32.543.1(24) Earnings before income taxes  

790.4750.75 Provision for income taxes

186.5188.7(1) Net earnings

603.9562.07 Less:  Net loss attributable to noncontrolling interest

(0.3)-100 Net Earnings of Zimmer Holdings, Inc. $
4.2
$
562.0
8 Earnings Per Common Share Basic

$
3.17$
2.7914Diluted

$
3.15$
2.7813 Weighted Average Common Shares Outstanding Basic

190.6201.2Diluted

191.8202.3 Certain amounts in the 2010 consolidated statement of earnings have been reclassified to conform to the 2011 presentation. ZIMMER HOLDINGS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in millions, unaudited) September 30, December 31, 20112010 Assets Current Assets:   Cash and cash equivalents

$
553.0

$
8.9   Short-term investments

424.9

265.1   Receivables, net

827.9

775.9   Inventories, net

968.4

936.4   Other current assets

299.1

363.4Total current assets

3,073.3

3,009.7 Property, plant and equipment, net

1,210.3

1,213.8 Goodwill

2,634.3

2,580.8 Intangible assets, net

794.7

827.1 Other assets

486.2

368.5 Total Assets $
8,198.8

$
7,999.9
Liabilities and Shareholders' Equity Current liabilities

$
74.6

$
702.5 Other long-term liabilities

372.0

384.0 Long-term debt

1,543.5

1,142.1 Shareholders' equity

5,608.7

5,771.3 Total Liabilities and Shareholders' Equity $
8,198.8

$
7,999.9
ZIMMER HOLDINGS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011 and 2010 (in millions, unaudited) 2011 2010 Cash flows provided by (used in) operating activities Net earnings

$ 603.9

$ 562.0 Depreciation and amortization

265.6

249.5 Share-based compensation

46.1

45.4 Income tax benefits from employee stock compensation plans

10.6

3.4 Excess income tax benefits from employee stock compensation plans

(4.0)

(1.1) Inventory step-up

9.6

1.3 Changes in operating assets and liabilities, net of acquired assets and liabilities Income taxes

6.8

(69.3)Receivables

(39.7)

(13.1)Inventories

(27.7)

6.9Accounts payable and accrued expenses

(41.3)

(9.1)Other assets and liabilities

(46.1)

76.6 Net cash provided by operating activities

783.8

852.5 Cash flows provided by (used in) investing activities Additions to instruments

(128.9)

(133.1) Additions to other property, plant and equipment

(67.8)

(40.6) Purchases of investments

(403.8)

(100.6) Sales of investments

225.0

56.5 Investments in other assets

(35.6)

(17.6) Net cash used in investing activities

(411.1)

(235.4) Cash flows provided by (used in) financing activities Net proceeds under revolving credit facilities

375.2

- Proceeds from employee stock compensation plans

34.0

12.9 Excess income tax benefits from employee stock compensation plans

4.0

1.1 Repurchase of common stock

(906.5)

(404.6) Net cash used in financing activities

(493.3)

(390.6) Effect of exchange rates on cash and cash equivalents

4.7

0.4 Increase (decrease) in cash and cash equivalents

(115.9)

226.9 Cash and cash equivalents, beginning of period

668.9

691.7 Cash and cash equivalents, end of period

$ 553.0

$ 918.6ZIMMER HOLDINGS, INC. NET SALES BY GEOGRAPHIC SEGMENT FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 and 2010 (in millions, unaudited) Three Months Ended September 30, Nine Months Ended September 30, 20112010% Inc20112010% Inc Americas

$
582.1

$ 583.2

-

%

$ 1,820.4

$ 1,808.2

1

% Europe

252.5

215.8

17876.4

778.4

13 Asia Pacific

196.9

166.0

19587.7

498.9

18 Total

$ 1,031.5

$ 965.0

7$ 3,284.5

$ 3,085.5

6ZIMMER HOLDINGS, INC. NET SALES BY PRODUCT CATEGORY FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 and 2010 (in millions, unaudited) Three Months Ended September 30, Nine Months Ended September 30, 20112010% Inc/(Dec)20112010% Inc/(Dec) Reconstructive Knees

$
416.7

$ 402.9

3

%

$ 1,349.8

$ 1,316.2

3

% Hips

315.6

287.3

10997.9

920.1

8 Extremities

36.0

33.6

7119.6

110.2

9768.3

723.8

62,467.3

2,346.5

5 Dental

55.1

49.0

12184.6

156.6

18 Trauma

69.3

58.1

19208.5

176.3

18 Spine

55.2

56.5

(2)168.5

174.4

(3) Surgical and other

83.6

77.6

8255.6

231.7

10 Total

$ 1,031.5

$ 965.0

7$ 3,284.5

$ 3,085.5

6ZIMMER HOLDINGS, INC.RECONCILIATION OF REPORTED % GROWTH TOCONSTANT CURRENCY % GROWTH(unaudited)For the Three Months EndedSeptember 30, 2011ForeignConstantReportedExchangeCurrency% GrowthImpact% GrowthGeographic Segments   Americas

-

%1

%(1)

%   Europe

17107   Asia Pacific

19127Total

752Product CategoriesReconstructive   Americas

(2)-(2)   Europe

17107   Asia Pacific

21138Total

651Knees   Americas

(4)-(4)   Europe

1697   Asia Pacific

19127Total

33-Hips   Americas

---   Europe

18126   Asia Pacific

231211Total

1064Extremities734Dental1239Trauma19514Spine(2)3(5)Surgical and other844ZIMMER HOLDINGS, INC.RECONCILIATION OF REPORTED % GROWTH TOCONSTANT CURRENCY % GROWTH(unaudited)For the Nine Months EndedSeptember 30, 2011ForeignConstantReportedExchangeCurrency% GrowthImpact% GrowthGeographic Segments   Americas

1

%1

%-

%   Europe

1385   Asia Pacific

18117Total

633Product CategoriesReconstructive   Americas

(1)-(1)   Europe

1174   Asia Pacific

18126Total

541Knees   Americas

(4)-(4)   Europe

1376   Asia Pacific

15123Total

34(1)Hips   Americas

2-2   Europe

1082   Asia Pacific

21129Total

853Extremities936Dental18315Trauma18414Spine(3)3(6)Surgical and other1046ZIMMER HOLDINGS, INC. Reconciliation of Net Earnings and Adjusted Net Earnings For the Three Months Ended September 30, 2011 and 2010 (in millions, unaudited) Three Months Ended September 30, 2011 2010 Net Earnings of Zimmer Holdings, Inc.

$ 191.5$ 191.1 Inventory step-up

1.8- Special items

8.05.0 Taxes on inventory step-up and special items and tax adjustments related to resolution of certain tax matters*

(4.1)(3.7) Adjusted Net Earnings

$ 197.2$ 192.4 * The tax effect is calculated based upon the statutory rates for the jurisdictions where the items were incurred. ZIMMER HOLDINGS, INC. Reconciliation of Net Earnings and Adjusted Net Earnings For the Nine Months Ended September 30, 2011 and 2010 (in millions, unaudited) Nine Months Ended September 30, 20112010 Net Earnings of Zimmer Holdings, Inc.

$ 604.2$ 562.0 Inventory step-up

9.61.3 Certain claims

50.075.0 Special items

47.019.1 Taxes on inventory step-up, certain claims and special items and tax adjustments related to resolution of certain tax matters*

(50.2)(36.4) Adjusted Net Earnings

$ 660.6$ 621.0 * The tax effect is calculated based upon the statutory rates for the jurisdictions where the items were incurred. ZIMMER HOLDINGS, INC. Reconciliation of Diluted EPS and Adjusted Diluted EPS For the Three Months Ended September 30, 2011 and 2010 (unaudited) Three Months Ended September 30,  20112010 Diluted EPS

$ 1.01$ 0.96 Inventory step-up

0.01- Special items

0.040.02 Taxes on inventory step-up and special items and tax adjustments related to resolution of certain tax matters*

(0.02)(0.02) Adjusted Diluted EPS

$ 1.04$ 0.96 * The tax effect is calculated based upon the statutory rates for the jurisdictions where the items were incurred. ZIMMER HOLDINGS, INC. Reconciliation of Diluted EPS and Adjusted Diluted EPS For the Nine Months Ended September 30, 2011 and 2010 (unaudited) Nine Months Ended September 30,  20112010 Diluted EPS

$ 3.15$ 2.78 Inventory step-up

0.050.01 Certain claims

0.260.37 Special items

0.240.09 Taxes on inventory step-up, certain claims and special items and tax adjustments related to resolution of certain tax matters*

(0.26)(0.18) Adjusted Diluted EPS

$ 3.44$ 3.07 * The tax effect is calculated based upon the statutory rates for the jurisdictions where the items were incurred. ZIMMER HOLDINGS, INC. Reconciliation of 2011 Projected Diluted EPS   and Projected Adjusted Diluted EPS (unaudited) Projected Year Ended December 31, 2011: LowHigh Diluted EPS

4.404.45 Inventory step-up

0.050.05 Special items

0.300.30 Certain claims

0.260.26 Taxes on inventory step-up, certain claims and special items and tax adjustments related to resolution of certain tax matters*

(0.26)(0.26) Adjusted Diluted EPS

$ 4.75$ 4.80 * The tax effect is calculated based upon the statutory rates for the jurisdictions where the items have or are projected to be incurred.
'/>"/>

SOURCE Zimmer Holdings, Inc.
Copyright©2010 PR Newswire.
All rights reserved


Related medicine technology :

1. Comparative Study Shows Significant Bone In-growth and Advanced Clinical Outcomes Using Zimmers Trabecular Metal(TM) Technology
2. Zimmer Holdings Announces Live Audio Webcast and Conference Call of Third Quarter 2009 Results
3. Zimmer Reports Fourth Quarter and 2009 Financial Results
4. Zimmer Holdings, Inc. Agrees to Sell $1 Billion of Senior Notes
5. Zimmer Holdings Announces Live Audio Webcast and Conference Call of Fourth Quarter and Full-Year 2009 Results
6. Zimmer Holdings to Present at 21st Annual Piper Jaffray Health Care Conference
7. Ameritox(R) Appoints Jay B. Zimmerman as Chief Operating Officer
8. Zimmer Holdings to Present at Cowen & Company 30th Annual Health Care Conference
9. Zimmer Natural Knee Celebrates 25 Years of Excellence
10. Zimmer Holdings to Present at Bank of America Merrill Lynch 2010 Health Care Conference
11. Zimmer Holdings to Present at Bairds 2010 Growth Stock Conference
Post Your Comments:
*Name:
*Comment:
*Email:
(Date:2/4/2016)... LONDON , Feb. 4, 2016 ... Summary Global Markets Direct,s, ,Wegener Polyangiitis - ... the Wegener Polyangiitis,s therapeutic pipeline. This report ... Wegener Polyangiitis, complete with comparative analysis at various ... action (MoA), route of administration (RoA) and molecule ...
(Date:2/4/2016)... Feb. 4, 2016 Summary Breast cancer, ... and the most common cancer in women worldwide, accounting ... exceedingly prevalent. The number of women diagnosed with breast ... the number of deaths has declined due to earlier ... has been revolutionized in the past four decades, especially ...
(Date:2/4/2016)... Frontier Pharma: Chronic Obstructive Pulmonary Disease ... Chronic Obstructive Pulmonary Disease (COPD) is ... the airways and lungs. Persistent breathing difficulties and ... one of the leading causes of morbidity and ... COPD is linked to cumulative exposure to risk ...
Breaking Medicine Technology:
(Date:2/6/2016)... ... 06, 2016 , ... Research has shown that building shame ... frequency and level of relapse. , At the 2016 iaedp Symposium, ... explore the critical tasks of the recovery phase and beyond including relapse prevention ...
(Date:2/5/2016)... ... February 05, 2016 , ... Today, the Whole-Food Warrior ... that the much-anticipated feature with author Jahnavi Foster, specialist in healthy vegetarian cuisine, will ... , Each week, on his weekly Whole-Food Warrior TV show, Frank Davis highlights Whole-Food ...
(Date:2/5/2016)... Santa Rosa, CA (PRWEB) , ... February 05, ... ... are pleased to announce the addition of micro-needling services in their Napa Valley ... appearance. The founders of Plastic Surgery Associates, Dr. Canales and Dr. Furnas, are ...
(Date:2/5/2016)... ... February 05, 2016 , ... ... to funding innovative lymphoma research and serving the lymphoma community through a comprehensive ... once again host, Swirl, A Wine Tasting Event at the La Gorce Country ...
(Date:2/5/2016)... , ... February 05, 2016 , ... Regular gym users ... themselves having to wait longer to access the treadmills. It’s a predictable trend. After ... to lose weight and get in shape by joining gyms, starting new walking or ...
Breaking Medicine News(10 mins):