Owens & Minor Reports Third Quarter 2024 Financial Results
Top-Line Growth Driven by Continued Solid Demand in Patient Direct and Medical Distribution
Total Debt Reduction of Nearly
Key Highlights:
-
Consolidated revenue of
$2.7 billion in the third quarter, representing year-over-year growth of 5% -
GAAP Net loss of
$(13) million or$(0.17) per share, and adjusted earnings per share of$0.42 in the third quarter -
Adjusted EBITDA of
$142 million in the third quarter, representing year-over-year growth of 5% -
$198 million in total debt reduction in the third quarter
“Our third quarter results demonstrated our ability to deliver on our commitments both near-term as well as on our strategic initiatives. Our Patient Direct segment continues to perform well in the growing home-based care space while we continue investing to support long-term profitable growth. In our Products & Healthcare Services segment, we continue to see solid top-line results, especially within our Medical Distribution division supported by recent wins and deepened relationships with our existing customers,” said
Pesicka concluded, “Looking ahead we are confident in our ability to show good sequential growth and cash flow from the third to fourth quarter which positions us well as we enter 2025. Each of the segments should benefit from seasonality and investments of the last several quarters as we finish 2024 and look to the future.”
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Financial Summary (1) |
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|
YTD |
|
YTD |
||
($ in millions, except per share data) |
|
3Q24 |
|
3Q23 |
|
2024 |
|
2023 |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
2,721 |
|
$ |
2,592 |
|
$ |
8,005 |
|
$ |
7,678 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income, GAAP |
|
$ |
24.2 |
|
$ |
23.8 |
|
$ |
54.2 |
|
$ |
44.5 |
Adj. Operating Income, Non-GAAP |
|
$ |
84.2 |
|
$ |
84.2 |
|
$ |
217.8 |
|
$ |
193.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss, GAAP |
|
$ |
(12.8) |
|
$ |
(6.4) |
|
$ |
(66.6) |
|
$ |
(59.1) |
Adj. Net Income, Non-GAAP |
|
$ |
33.2 |
|
$ |
34.1 |
|
$ |
76.2 |
|
$ |
51.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adj. EBITDA, Non-GAAP |
|
$ |
141.8 |
|
$ |
134.7 |
|
$ |
384.9 |
|
$ |
356.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share, GAAP |
|
$ |
(0.17) |
|
$ |
(0.08) |
|
$ |
(0.87) |
|
$ |
(0.78) |
Adj. Net Income per share, Non-GAAP |
|
$ |
0.42 |
|
$ |
0.44 |
|
$ |
0.97 |
|
$ |
0.67 |
(1) Reconciliations of the differences between the non-GAAP financial measures presented in this release and their most directly comparable GAAP financial measures are included in the tables below.
Results and Business Highlights
-
Consolidated revenue of
$2.7 billion in the third quarter of 2024, an increase of 5% compared to the third quarter of 2023-
Patient Direct revenue of
$687 million , up 6% compared to the third quarter of 2023, driven by strength in a number of categories led by diabetes and sleep supplies -
Products & Healthcare Services revenue of
$2.0 billion , up 5% compared to the third quarter of 2023, driven primarily by strong same store sales in the Medical Distribution division along with one additional sales day
-
Patient Direct revenue of
-
Third quarter 2024 operating income of
$24 million and Adjusted Operating Income of$84 million -
Sequentially, third quarter 2024 GAAP operating income improved by
$4 million and Adjusted Operating Income increased by$8 million
-
Sequentially, third quarter 2024 GAAP operating income improved by
-
GAAP Net loss of
$(13) million and Adjusted Net Income of$33 million in the third quarter of 2024-
Adjusted EBITDA of
$142 million in the third quarter, representing year-over-year growth of 5%
-
Adjusted EBITDA of
-
Reduced total debt by
$198 million including full redemption of the 2024 senior notes
2024 Financial Outlook
The Company’s recently revised financial guidance; summarized below:
-
Revenue for 2024 to be in a range of
$10.6 billion to$10.8 billion -
Adjusted EBITDA for 2024 to be in a range of
$540 million to$550 million -
Adjusted EPS for 2024 to be in a range of
$1.45 to$1.55
The Company’s outlook for 2024 contains assumptions, including current expectations regarding the impact of general economic conditions, including inflation, and the continuation of pressure on pricing and demand in our Products & Healthcare Services segment. Key assumptions supporting the Company’s 2024 financial guidance include:
- Gross margin rate of 20.5% to 21.0%
-
Interest expense of
$142 to$144 million - Adjusted effective tax rate of 27.5% to 28.5%
- Diluted weighted average shares of ~78.5 million
-
Capital expenditures of
$225 to$235 million - Stable commodity prices
-
FX rates as of
12/31/2023
Although the Company does provide guidance for adjusted EBITDA and adjusted EPS (which are non-GAAP financial measures), it is not able to forecast the most directly comparable measures calculated and presented in accordance with GAAP without unreasonable effort. Certain elements of the composition of the GAAP amounts are not predictable, making it impracticable for the Company to forecast. Such elements include, but are not limited to, restructuring and acquisition charges, which could have a significant and unpredictable impact on our GAAP results. As a result, no GAAP guidance or reconciliation of the Company’s adjusted EBITDA guidance or adjusted EPS guidance is provided. The outlook is based on certain assumptions that are subject to the risk factors discussed in the Company’s filings with the
Investor Conference Call for Third Quarter 2024 Financial Results
Owens & Minor executives will host a conference call for investors and analysts on
All interested stakeholders are encouraged to access the simultaneous live webcast by visiting the investor relations page of the Owens & Minor website available at investors.owens-minor.com/events-and-presentations/. A replay of the webcast can be accessed following the presentation at the link provided above.
Safe Harbor
This release is intended to be disclosure through methods reasonably designed to provide broad, non-exclusionary distribution to the public in compliance with the
About Owens & Minor
*Registered Trademark or Trademark of
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||||||
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Three Months Ended |
||||
|
|
2024 |
|
2023 |
||
Net revenue |
|
$ |
2,721,125 |
|
$ |
2,591,742 |
Cost of goods sold |
|
|
2,161,419 |
|
|
2,053,244 |
Gross profit |
|
|
559,706 |
|
|
538,498 |
Distribution, selling and administrative expenses |
|
|
469,798 |
|
|
452,583 |
Acquisition-related charges and intangible amortization |
|
|
21,097 |
|
|
30,217 |
Exit and realignment charges, net |
|
|
28,880 |
|
|
30,180 |
Other operating expense, net |
|
|
15,727 |
|
|
1,677 |
Operating income |
|
|
24,204 |
|
|
23,841 |
Interest expense, net |
|
|
36,554 |
|
|
38,127 |
Other expense (income), net |
|
|
1,438 |
|
|
(3,302) |
Loss before income taxes |
|
|
(13,788) |
|
|
(10,984) |
Income tax benefit |
|
|
(1,018) |
|
|
(4,558) |
Net loss |
|
$ |
(12,770) |
|
$ |
(6,426) |
|
|
|
|
|
|
|
Net loss per common share: |
|
|
|
|
|
|
Basic |
|
$ |
(0.17) |
|
$ |
(0.08) |
Diluted |
|
$ |
(0.17) |
|
$ |
(0.08) |
|
||||||
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|
|
|
|
|
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Nine Months Ended |
||||
|
|
2024 |
|
2023 |
||
Net revenue |
|
$ |
8,004,810 |
|
$ |
7,677,817 |
Cost of goods sold |
|
|
6,365,421 |
|
|
6,122,579 |
Gross profit |
|
|
1,639,389 |
|
|
1,555,238 |
Distribution, selling and administrative expenses |
|
|
1,416,724 |
|
|
1,356,334 |
Acquisition-related charges and intangible amortization |
|
|
61,395 |
|
|
74,609 |
Exit and realignment charges, net |
|
|
85,530 |
|
|
74,817 |
Other operating expense, net |
|
|
21,542 |
|
|
4,991 |
Operating income |
|
|
54,198 |
|
|
44,487 |
Interest expense, net |
|
|
108,108 |
|
|
121,053 |
Other expense (income), net |
|
|
3,796 |
|
|
(843) |
Loss before income taxes |
|
|
(57,706) |
|
|
(75,723) |
Income tax provision (benefit) |
|
|
8,864 |
|
|
(16,638) |
Net loss |
|
$ |
(66,570) |
|
$ |
(59,085) |
|
|
|
|
|
|
|
Net loss per common share: |
|
|
|
|
|
|
Basic |
|
$ |
(0.87) |
|
$ |
(0.78) |
Diluted |
|
$ |
(0.87) |
|
$ |
(0.78) |
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||||||
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||
|
|
2024 |
|
2023 |
||
Assets |
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
45,454 |
|
$ |
243,037 |
Accounts receivable, net |
|
|
661,664 |
|
|
598,257 |
Merchandise inventories |
|
|
1,242,453 |
|
|
1,110,606 |
Other current assets |
|
|
166,967 |
|
|
150,890 |
Total current assets |
|
|
2,116,538 |
|
|
2,102,790 |
Property and equipment, net |
|
|
498,746 |
|
|
543,972 |
Operating lease assets |
|
|
357,264 |
|
|
296,533 |
|
|
|
1,642,196 |
|
|
1,638,846 |
Intangible assets, net |
|
|
313,284 |
|
|
361,835 |
Other assets, net |
|
|
153,254 |
|
|
149,346 |
Total assets |
|
$ |
5,081,282 |
|
$ |
5,093,322 |
Liabilities and equity |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
Accounts payable |
|
$ |
1,338,021 |
|
$ |
1,171,882 |
Accrued payroll and related liabilities |
|
|
100,002 |
|
|
116,398 |
Current portion of long-term debt |
|
|
42,626 |
|
|
206,904 |
Other current liabilities |
|
|
453,517 |
|
|
396,701 |
Total current liabilities |
|
|
1,934,166 |
|
|
1,891,885 |
Long-term debt, excluding current portion |
|
|
1,842,348 |
|
|
1,890,598 |
Operating lease liabilities, excluding current portion |
|
|
288,043 |
|
|
222,429 |
Deferred income taxes, net |
|
|
25,650 |
|
|
41,652 |
Other liabilities |
|
|
116,483 |
|
|
122,592 |
Total liabilities |
|
|
4,206,690 |
|
|
4,169,156 |
Total equity |
|
|
874,592 |
|
|
924,166 |
Total liabilities and equity |
|
$ |
5,081,282 |
|
$ |
5,093,322 |
|
||||||
|
|
|
|
|
|
|
|
|
Three Months Ended |
||||
|
|
2024 |
|
2023 |
||
Operating activities: |
|
|
|
|
|
|
Net loss |
|
$ |
(12,770) |
|
$ |
(6,426) |
Adjustments to reconcile net loss to cash provided by operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
61,614 |
|
|
73,652 |
Share-based compensation expense |
|
|
5,680 |
|
|
5,742 |
(Benefit) provision for losses on accounts receivable |
|
|
(1,862) |
|
|
413 |
Loss (gain) on extinguishment of debt |
|
|
311 |
|
|
(5,222) |
Deferred income tax benefit |
|
|
(6,090) |
|
|
(9,557) |
Changes in operating lease right-of-use assets and lease liabilities |
|
|
3,390 |
|
|
1,560 |
Gain from sales and dispositions of property and equipment |
|
|
(9,806) |
|
|
(7,899) |
Changes in operating assets and liabilities: |
|
|
|
|
|
|
Accounts receivable |
|
|
9,093 |
|
|
(13,006) |
Merchandise inventories |
|
|
(9,356) |
|
|
81,406 |
Accounts payable |
|
|
(39,110) |
|
|
(5,821) |
Net change in other assets and liabilities |
|
|
24,236 |
|
|
39,913 |
Other, net |
|
|
1,977 |
|
|
2,680 |
Cash provided by operating activities |
|
|
27,307 |
|
|
157,435 |
Investing activities: |
|
|
|
|
|
|
Additions to property and equipment |
|
|
(57,652) |
|
|
(47,728) |
Additions to computer software |
|
|
(3,866) |
|
|
(2,860) |
Proceeds from sales of property and equipment |
|
|
17,733 |
|
|
17,916 |
Other, net |
|
|
16,596 |
|
|
— |
Cash used for investing activities |
|
|
(27,189) |
|
|
(32,672) |
Financing activities: |
|
|
|
|
|
|
Borrowings under amended Receivables Financing Agreement |
|
|
619,100 |
|
|
127,800 |
Repayments under amended Receivables Financing Agreement |
|
|
(619,100) |
|
|
(127,800) |
Repayments of debt |
|
|
(199,072) |
|
|
(191,888) |
Other, net |
|
|
(515) |
|
|
8,893 |
Cash used for financing activities |
|
|
(199,587) |
|
|
(182,995) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
|
1,090 |
|
|
(711) |
Net decrease in cash, cash equivalents and restricted cash |
|
|
(198,379) |
|
|
(58,943) |
Cash, cash equivalents and restricted cash at beginning of period |
|
|
273,469 |
|
|
309,103 |
Cash, cash equivalents and restricted cash at end of period(1) |
|
$ |
75,090 |
|
$ |
250,160 |
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
Income taxes paid, net |
|
$ |
2,370 |
|
$ |
3,708 |
Interest paid |
|
$ |
33,459 |
|
$ |
22,454 |
Noncash investing activity: |
|
|
|
|
|
|
Unpaid purchases of property and equipment and computer software at end of period |
|
$ |
75,176 |
|
$ |
60,870 |
_____________________ |
(1) Restricted cash as of |
|
||||||
|
|
|
|
|
|
|
|
|
Nine Months Ended |
||||
|
|
2024 |
|
2023 |
||
Operating activities: |
|
|
|
|
|
|
Net loss |
|
$ |
(66,570) |
|
$ |
(59,085) |
Adjustments to reconcile net loss to cash provided by operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
199,588 |
|
|
216,640 |
Share-based compensation expense |
|
|
19,281 |
|
|
17,417 |
Benefit for losses on accounts receivable |
|
|
(1,538) |
|
|
(487) |
Loss (gain) on extinguishment of debt |
|
|
311 |
|
|
(4,379) |
Deferred income tax benefit |
|
|
(15,119) |
|
|
(16,315) |
Changes in operating lease right-of-use assets and lease liabilities |
|
|
7,156 |
|
|
(1,517) |
Gain from sales and dispositions of property and equipment |
|
|
(37,682) |
|
|
(26,462) |
Changes in operating assets and liabilities: |
|
|
|
|
|
|
Accounts receivable |
|
|
(59,349) |
|
|
77,197 |
Merchandise inventories |
|
|
(132,433) |
|
|
247,057 |
Accounts payable |
|
|
164,261 |
|
|
46,338 |
Net change in other assets and liabilities |
|
|
4,719 |
|
|
122,867 |
Other, net |
|
|
7,869 |
|
|
9,674 |
Cash provided by operating activities |
|
|
90,494 |
|
|
628,945 |
Investing activities: |
|
|
|
|
|
|
Additions to property and equipment |
|
|
(148,031) |
|
|
(140,478) |
Additions to computer software |
|
|
(8,695) |
|
|
(11,089) |
Proceeds from sales of property and equipment |
|
|
84,759 |
|
|
53,645 |
Other, net |
|
|
7,738 |
|
|
(418) |
Cash used for investing activities |
|
|
(64,229) |
|
|
(98,340) |
Financing activities: |
|
|
|
|
|
|
Borrowings under amended Receivables Financing Agreement |
|
|
1,286,400 |
|
|
476,000 |
Repayments under amended Receivables Financing Agreement |
|
|
(1,286,400) |
|
|
(572,000) |
Repayments of debt |
|
|
(211,447) |
|
|
(270,189) |
Other, net |
|
|
(13,060) |
|
|
74 |
Cash used for financing activities |
|
|
(224,507) |
|
|
(366,115) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
|
408 |
|
|
(515) |
Net (decrease) increase in cash, cash equivalents and restricted cash |
|
|
(197,834) |
|
|
163,975 |
Cash, cash equivalents and restricted cash at beginning of period |
|
|
272,924 |
|
|
86,185 |
Cash, cash equivalents and restricted cash at end of period(1) |
|
$ |
75,090 |
|
$ |
250,160 |
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
Income taxes paid (received), net |
|
$ |
7,610 |
|
$ |
(6,798) |
Interest paid |
|
$ |
104,278 |
|
$ |
101,079 |
Noncash investing activity: |
|
|
|
|
|
|
Unpaid purchases of property and equipment and computer software at end of period |
|
$ |
75,176 |
|
$ |
60,870 |
_____________________ |
(1) Restricted cash as of |
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
||||||||
|
|
2024 |
|
2023 |
|
||||||
|
|
|
|
|
% of |
|
|
|
|
% of |
|
|
|
|
|
|
consolidated |
|
|
|
|
consolidated |
|
|
|
Amount |
|
net revenue |
|
Amount |
|
net revenue |
|
||
Net revenue: |
|
|
|
|
|
|
|
|
|
|
|
Products & Healthcare Services |
|
$ |
2,034,279 |
|
74.76 |
% |
$ |
1,943,467 |
|
74.99 |
% |
Patient Direct |
|
|
686,846 |
|
25.24 |
% |
|
648,275 |
|
25.01 |
% |
Consolidated net revenue |
|
$ |
2,721,125 |
|
100.00 |
% |
$ |
2,591,742 |
|
100.00 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% of segment |
|
|
|
|
% of segment |
|
Operating income: |
|
|
|
|
net revenue |
|
|
|
|
net revenue |
|
Products & Healthcare Services |
|
$ |
4,233 |
|
0.21 |
% |
$ |
19,803 |
|
1.02 |
% |
Patient Direct |
|
|
79,932 |
|
11.64 |
% |
|
64,435 |
|
9.94 |
% |
Acquisition-related charges and intangible amortization |
|
|
(21,097) |
|
|
|
|
(30,217) |
|
|
|
Exit and realignment charges, net |
|
|
(28,880) |
|
|
|
|
(30,180) |
|
|
|
Litigation and related charges (1) |
|
|
(9,984) |
|
|
|
|
— |
|
|
|
Consolidated operating income |
|
$ |
24,204 |
|
|
|
$ |
23,841 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization: |
|
|
|
|
|
|
|
|
|
|
|
Products & Healthcare Services |
|
$ |
18,382 |
|
|
|
$ |
20,021 |
|
|
|
Patient Direct |
|
|
43,232 |
|
|
|
|
53,631 |
|
|
|
Consolidated depreciation and amortization |
|
$ |
61,614 |
|
|
|
$ |
73,652 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures: |
|
|
|
|
|
|
|
|
|
|
|
Products & Healthcare Services |
|
$ |
17,763 |
|
|
|
$ |
5,023 |
|
|
|
Patient Direct |
|
|
43,755 |
|
|
|
|
45,565 |
|
|
|
Consolidated capital expenditures |
|
$ |
61,518 |
|
|
|
$ |
50,588 |
|
|
|
(1) |
Litigation and related charges are reported within Other operating expense, net in our Statements of Operations. Refer to footnote 3 in the GAAP/Non-GAAP Reconciliations below. |
|
|
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended |
|
||||||||
|
|
2024 |
|
2023 |
|
||||||
|
|
|
|
|
% of |
|
|
|
|
% of |
|
|
|
|
|
|
consolidated |
|
|
|
|
consolidated |
|
|
|
Amount |
|
net revenue |
|
Amount |
|
net revenue |
|
||
Net revenue: |
|
|
|
|
|
|
|
|
|
|
|
Products & Healthcare Services |
|
$ |
6,019,721 |
|
75.20 |
% |
$ |
5,789,679 |
|
75.41 |
% |
Patient Direct |
|
|
1,985,089 |
|
24.80 |
% |
|
1,888,138 |
|
24.59 |
% |
Consolidated net revenue |
|
$ |
8,004,810 |
|
100.00 |
% |
$ |
7,677,817 |
|
100.00 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% of segment |
|
|
|
|
% of segment |
|
Operating income: |
|
|
|
|
net revenue |
|
|
|
|
net revenue |
|
Products & Healthcare Services |
|
$ |
27,187 |
|
0.45 |
% |
$ |
24,564 |
|
0.42 |
% |
Patient Direct |
|
|
190,598 |
|
9.60 |
% |
|
169,349 |
|
8.97 |
% |
Acquisition-related charges and intangible amortization |
|
|
(61,395) |
|
|
|
|
(74,609) |
|
|
|
Exit and realignment charges, net |
|
|
(85,530) |
|
|
|
|
(74,817) |
|
|
|
Litigation and related charges (1) |
|
|
(16,662) |
|
|
|
|
— |
|
|
|
Consolidated operating income |
|
$ |
54,198 |
|
|
|
$ |
44,487 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization: |
|
|
|
|
|
|
|
|
|
|
|
Products & Healthcare Services |
|
$ |
60,832 |
|
|
|
$ |
57,360 |
|
|
|
Patient Direct |
|
|
138,756 |
|
|
|
|
159,280 |
|
|
|
Consolidated depreciation and amortization |
|
$ |
199,588 |
|
|
|
$ |
216,640 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures: |
|
|
|
|
|
|
|
|
|
|
|
Products & Healthcare Services |
|
$ |
29,130 |
|
|
|
$ |
17,957 |
|
|
|
Patient Direct |
|
|
127,596 |
|
|
|
|
133,610 |
|
|
|
Consolidated capital expenditures |
|
$ |
156,726 |
|
|
|
$ |
151,567 |
|
|
|
(1) |
Litigation and related charges are reported within Other operating expense, net in our Statements of Operations. Refer to footnote 3 in the GAAP/Non-GAAP Reconciliations below. |
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
Net loss |
|
$ |
(12,770) |
|
$ |
(6,426) |
|
$ |
(66,570) |
|
$ |
(59,085) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding - basic |
|
|
77,090 |
|
|
76,203 |
|
|
76,657 |
|
|
75,691 |
Dilutive shares |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
Weighted average shares outstanding - diluted |
|
|
77,090 |
|
|
76,203 |
|
|
76,657 |
|
|
75,691 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.17) |
|
$ |
(0.08) |
|
$ |
(0.87) |
|
$ |
(0.78) |
Diluted |
|
$ |
(0.17) |
|
$ |
(0.08) |
|
$ |
(0.87) |
|
$ |
(0.78) |
Share-based awards of approximately 1.4 million and 1.5 million shares for the three and nine months ended
GAAP/Non-GAAP Reconciliations (unaudited)
(dollars in thousands, except per share data)
The following table provides a reconciliation of reported operating income, net loss and net loss per share to non-GAAP measures used by management.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
||||||||
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
||||
Operating income, as reported (GAAP) |
|
$ |
24,204 |
|
$ |
23,841 |
|
$ |
54,198 |
|
$ |
44,487 |
|
Acquisition-related charges and intangible amortization (1) |
|
|
21,097 |
|
|
30,217 |
|
|
61,395 |
|
|
74,609 |
|
Exit and realignment charges, net (2) |
|
|
28,880 |
|
|
30,180 |
|
|
85,530 |
|
|
74,817 |
|
Litigation and related charges (3) |
|
|
9,984 |
|
|
— |
|
|
16,662 |
|
|
— |
|
Operating income, adjusted (non-GAAP) (Adjusted Operating Income) |
|
$ |
84,165 |
|
$ |
84,238 |
|
$ |
217,785 |
|
$ |
193,913 |
|
Operating income as a percent of net revenue (GAAP) |
|
|
0.89 |
% |
|
0.92 |
% |
|
0.68 |
% |
|
0.58 |
% |
Adjusted operating income as a percent of net revenue (non-GAAP) |
|
|
3.09 |
% |
|
3.25 |
% |
|
2.72 |
% |
|
2.53 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss, as reported (GAAP) |
|
$ |
(12,770) |
|
$ |
(6,426) |
|
$ |
(66,570) |
|
$ |
(59,085) |
|
Pre-tax adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related charges and intangible amortization (1) |
|
|
21,097 |
|
|
30,217 |
|
|
61,395 |
|
|
74,609 |
|
Exit and realignment charges, net (2) |
|
|
28,880 |
|
|
30,180 |
|
|
85,530 |
|
|
74,817 |
|
Litigation and related charges (3) |
|
|
9,984 |
|
|
— |
|
|
16,662 |
|
|
— |
|
Other (4) |
|
|
741 |
|
|
(4,657) |
|
|
1,602 |
|
|
(2,685) |
|
Income tax benefit on pre-tax adjustments (5) |
|
|
(14,763) |
|
|
(15,180) |
|
|
(39,665) |
|
|
(35,711) |
|
One-time income tax charge (6) |
|
|
— |
|
|
— |
|
|
17,233 |
|
|
— |
|
Net income, adjusted (non-GAAP) (Adjusted Net Income) |
|
$ |
33,169 |
|
$ |
34,134 |
|
$ |
76,187 |
|
$ |
51,945 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share, as reported (GAAP) |
|
$ |
(0.17) |
|
$ |
(0.08) |
|
$ |
(0.87) |
|
$ |
(0.78) |
|
After-tax adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related charges and intangible amortization (1) |
|
|
0.20 |
|
|
0.28 |
|
|
0.60 |
|
|
0.74 |
|
Exit and realignment charges, net (2) |
|
|
0.28 |
|
|
0.28 |
|
|
0.83 |
|
|
0.74 |
|
Litigation and related charges (3) |
|
|
0.10 |
|
|
— |
|
|
0.17 |
|
|
— |
|
Other (4) |
|
|
0.01 |
|
|
(0.04) |
|
|
0.02 |
|
|
(0.03) |
|
One-time income tax charge (6) |
|
|
— |
|
|
— |
|
|
0.22 |
|
|
— |
|
Net income per common share, adjusted (non-GAAP) (Adjusted EPS) |
|
$ |
0.42 |
|
$ |
0.44 |
|
$ |
0.97 |
|
$ |
0.67 |
|
GAAP/Non-GAAP Reconciliations (unaudited), continued
(dollars in thousands)
The following tables provide reconciliations of net loss and total debt to non-GAAP measures used by management.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
Net loss, as reported (GAAP) |
|
$ |
(12,770) |
|
$ |
(6,426) |
|
$ |
(66,570) |
|
$ |
(59,085) |
Income tax (benefit) provision |
|
|
(1,018) |
|
|
(4,558) |
|
|
8,864 |
|
|
(16,638) |
Interest expense, net |
|
|
36,554 |
|
|
38,127 |
|
|
108,108 |
|
|
121,053 |
Acquisition-related charges and intangible amortization (1) |
|
|
21,097 |
|
|
30,217 |
|
|
61,395 |
|
|
74,609 |
Exit and realignment charges, net (2) |
|
|
28,880 |
|
|
30,180 |
|
|
85,530 |
|
|
74,817 |
Other depreciation and amortization (7) |
|
|
46,342 |
|
|
50,909 |
|
|
140,501 |
|
|
151,635 |
Litigation and related charges (3) |
|
|
9,984 |
|
|
— |
|
|
16,662 |
|
|
— |
Stock compensation (8) |
|
|
5,339 |
|
|
4,616 |
|
|
17,827 |
|
|
15,761 |
LIFO charges and (credits) (9) |
|
|
6,672 |
|
|
(3,660) |
|
|
10,985 |
|
|
(3,253) |
Other (4) |
|
|
741 |
|
|
(4,657) |
|
|
1,602 |
|
|
(2,685) |
Adjusted EBITDA (non-GAAP) |
|
$ |
141,821 |
|
$ |
134,748 |
|
$ |
384,904 |
|
$ |
356,214 |
|
|
|
|
|
|
|
|
|
|
||
|
2024 |
|
2023 |
||
Total debt, as reported (GAAP) |
$ |
1,884,974 |
|
$ |
2,097,502 |
Cash and cash equivalents |
|
(45,454) |
|
|
(243,037) |
Net debt (non-GAAP) |
$ |
1,839,520 |
|
$ |
1,854,465 |
The following items have been excluded in our non-GAAP financial measures:
(1) Acquisition-related charges and intangible amortization for the three and nine months ended
(2) During the three and nine months ended
(3) Litigation and related charges includes settlement costs and related charges of legal matters within our Apria division. These costs do not occur in the ordinary course of our business, are non-recurring/infrequent and are inherently unpredictable in timing and amount.
(4) For the three and nine months ended
(5) These charges have been tax effected by determining the income tax rate depending on the amount of charges incurred in different tax jurisdictions and the deductibility of those charges for income tax purposes.
(6) One-time income tax charge, recorded during the three months ended
(7) Other depreciation and amortization relates to property and equipment and capitalized computer software, excluding such amounts captured within exit and realignment charges, net or acquisition-related charges.
(8) Stock compensation includes share-based compensation expense related to our share-based compensation plans, excluding such amounts captured within exit and realignment charges, net or acquisition-related charges.
(9) LIFO charges and (credits) includes non-cash adjustments to merchandise inventories valued at the lower of cost or market, with the approximate cost determined by the last-in, first-out (LIFO) method for distribution inventories in the
Use of Non-GAAP Measures
This earnings release contains financial measures that are not calculated in accordance with
Management provides these non-GAAP financial measures to investors as supplemental metrics to assist readers in assessing the effects of items and events on its financial and operating results and in comparing the Company’s performance to that of its competitors. However, the non-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.
The non-GAAP financial measures disclosed by the Company should not be considered substitutes for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements set forth above should be carefully evaluated.
OMI-IR
View source version on businesswire.com: https://www.businesswire.com/news/home/20241104535251/en/
Investors
OMI@alpha-ir.com
Executive Vice President & Chief Financial Officer
Investor.Relations@owens-minor.com
Media
media@owens-minor.com
Source: