Patterson Companies Inc PDCO

Healthcare

Patterson Companies, Inc. is a value-added specialty distributor serving the United States and Canadian dental supply markets and the United States, Canadian and United Kingdom animal health supply markets. The Company’s segments include Dental, Animal Health and Corporate. Dental segment provides a virtually complete range of consumable dental products, equipment and software, turnkey digital solutions and value-added services to dentists, dental laboratories, institutions, and other healthcare professionals throughout North America. Animal Health segment is a full-line distributor in North America and the United Kingdom. of animal health products, services, and technologies to both the production-animal and companion-pet markets. The Company provides relief services. It also provides pasteurizing equipment and single-use bags that allow dairy producers to produce, store and feed colostrum for newborn calves, as well as product offerings for beef cattle producers.

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Patterson Companies Inc

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Post by bc4uon Nov 21, 2012 9:11am

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Patterson Companies Reports Second Quarter Operati

Patterson Companies Reports Second Quarter Operating Results

St. Paul, MN—November 20, 2012— Patterson Companies, Inc. (Nasdaq: PDCO) today
reported consolidated sales of $867,193,000 for the second quarter of fiscal 2013 ended October
27, an increase of 1% from $856,875,000 in the year-earlier period. Net income of $45,542,000
or $0.44 per diluted share, compared to $48,954,000 or $0.43 per diluted share in the second
quarter of fiscal 2012. Net income in this year’s second quarter was affected primarily by belowplan
sales of dental equipment, as well as the absorption of $3.0 million of incremental interest
expense related to Patterson’s debt issuance in the third quarter of fiscal 2012
Patterson Dental
Patterson Dental, Patterson’s largest business, reported sales of $549,149,000, substantially
unchanged from last year’s second quarter.
? Sales of consumable dental supplies and printed office products increased 1%.
? Mid-single digit revenue growth of technology products was offset by softness in basic
equipment resulting in a 3% decline in sales of dental equipment and software. Demand
for the next-generation CEREC system incorporating the new Omnicam intraoral camera
was strong during the quarter, but sales of this recently introduced system were
constrained by product availability.
? Sales of other services and products, consisting primarily of technical service, parts and
labor, software support services and artificial teeth, increased 2% from last year’s second
quarter.
Webster Veterinary
Internally-generated sales of the Webster Veterinary unit increased 13% in the second quarter. A
change in a distribution agreement for nutritional products in the fourth quarter of fiscal 2012
reduced Webster’s second quarter reported sales growth by approximately six percentage points.
Webster reported sales of $184,375,000 for the quarter.
Patterson Medical
Sales of Patterson Medical, the rehabilitation supply and equipment unit, which totaled
$133,669,000, were virtually unchanged from the year-earlier period. Patterson Medical’s April
2012 acquisition of Surgical Synergies Pty Ltd., a distributor of physiotherapy, rehabilitation and
mobility products serving the Australian and New Zealand markets, contributed approximately
one percentage point of sales growth in the second quarter.
Scott P. Anderson, president and chief executive officer, commented: “Several areas of our
business, including dental technology equipment and Webster Veterinary, performed well in the
second quarter. On balance, however, we are not satisfied with our recent operating results,
which did not meet our expectations, and we are committed to strengthening Patterson’s longterm
performance. While our businesses, like many others, are challenged by current economic
conditions, we will continue to make the investments that position Patterson to capitalize upon
opportunities in each of our markets.”
He continued: “Sales of basic dental equipment, including chairs, units and lighting, were below
planned levels. This shortfall was partially offset by continued growth of our industry-leading
range of technology equipment, reflecting the ongoing trend toward the digitization of dentistry.
We were particularly encouraged by robust demand for the next-generation CEREC Omnicam
system, which became available on a limited basis in the second quarter. This important new
product is significantly easier to use than prior versions, while further improving clinical outcomes.
We expect the production volumes to ramp up during the second half of our fiscal year.”
“Webster’s solidly higher second quarter sales growth was generated by strong demand for
consumable supplies,” Anderson said. “To further strengthen its competitive position, Webster is focusing resources on its growing range of technology solutions for veterinarians and their clients,
in addition to expanding local technical support capabilities for its equipment business.”
He added: “Sales of Patterson Medical were below our internal forecast as moderately higher
sales of consumable supplies in the U.S. were offset by continued weakness in the unit’s
international and equipment business. Despite U.S. healthcare regulatory uncertainties and the
weak economic environment in its global markets, we believe Patterson Medical is wellpositioned
to capitalize upon positive long-term demographic trends in the worldwide
rehabilitation market.”
Patterson repurchased approximately 1.6 million common shares during the second quarter
under its 25 million-share buyback authorization that expires in 2016. Approximately 8 million
shares remain available for repurchase under this authorization.
Reflecting the second quarter sales shortfall and outlook for continued economic uncertainty,
Patterson reduced its previously-issued fiscal 2013 financial guidance of $2.10 to $2.16 per
diluted share to a new range of $2.00 to $2.06.
About Patterson Companies, Inc.
Patterson Companies, Inc. is a value-added distributor serving the dental, companion-pet
veterinarian and rehabilitation supply markets.
Dental Market
As Patterson’s largest business, Patterson Dental provides a virtually complete range of
consumable dental products, equipment and software, turnkey digital solutions and value-added
services to dentists and dental laboratories throughout North America.
Veterinary Market
Webster Veterinary is a leading distributor of consumable veterinary supplies, equipment and
software, diagnostic products, vaccines and pharmaceuticals to companion-pet veterinary clinics.
Rehabilitation Market
Patterson Medical is the world’s leading distributor of rehabilitation supplies and non-wheelchair
assistive patient products to the physical and occupational therapy markets. The unit’s global
customer base includes hospitals, long-term care facilities, clinics and dealers.

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