Cantel Medical slumps on Q2 earnings release

Shares in Cantel Medical (NYSE:CMN) have slumped today despite the medical device maker posting 2nd quarter earnings results which topped Wall Street expectations in earnings per share, but missed on sales.

The Little Falls, N.J.-based company posted profits of $18.1 million, or 43¢ per share, on sales of $184.8 million for the 3 months ended January 31, for bottom-line growth of 17.4% while sales grew 16.8% compared with the same period last year.

Adjusted to exclude 1-time items, earnings per share were 52¢ per share, ahead of consensus on The Street, where analysts were looking for sales of $188 million, which the company did not meet.

“We are pleased to report solid sales growth and earnings performance this quarter. Our 16.8% reported sales growth is driven by strong organic growth of 12.1%, acquisitions contributing 5.8% and foreign currency translation impact of (1.1%). All three of our major business segments had strong performance in the second quarter. The dedicated focus on our strategic priorities—new product development, global market expansion and strategic acquisitions— continues to drive our growth. Execution of these initiatives has helped us achieve double-digit organic sales growth in 12 of the past 14 quarters. We are also pleased to report a gross margin of 47.9%, up 220 basis points driven by a continued favorable shift in product mix as well as our ongoing continuous improvement efforts. the company has a strong balance sheet and continues to generate significant cash flow and EBITDAS. We finished the second quarter with cash of $24,351,000 and gross debt of $149,000,000, while generating adjusted EBITDAS of $39,514,000 in the quarter, up 19.6%,” prez & CEO Jørgen Hansen said in a press release.

Shares in Cantel Medical dropped 6.6% to close at $78.64.

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