Sirona Dental reported solid earnings and positive guidance today and the stock is up this morning. According to the Press Release, revenue was $177.9 million (an 31.3% increase year over year) with growth registered in all the company's business segments. In particular, Dental CAD/CAM Systems increased 68% and Imaging Systems increased 27%. Revenue in the United States increased by 32%. Outside the United States, revenue increased 31%.Dental CAD/CAM revenue growth was mainly driven by sales of the Company’s new MC XL systems. Imaging Systems’ revenues increased due to the continued adoption of digital radiography, increased sales of panoramic imaging units and sales of the Company’s Galileos 3D imaging system.
Gross profit increased year over year by $23.8 million to $82.7 million (up 40.4%). Gross profit margins also increased three percentage points. Net income was $51.8 million (compared to a net loss of $1.5 million last year) .
These results included a one-time benefit of $45.6 million, due to the revaluation of deferred tax assets and liabilities resulting from a reduction in the German tax rate. If you net out the one-time benefit, my math has the company's EPS at $0.27 per share (diluted) vs. a consensus number of $0.29. Despite the "miss", the earnings included a huge currency loss of almost $7 million. More importantly, however, is that revenue exceeded expectations by 13% or $20 million and guidance for 2008 looks very good with expected revenue between $705 and $725 million within analyst expectations of $717 million.
SIRO's stock price has been down sharply over the last month because of fear that the dental market has been slow lately. Today's numbers suggest that this is not the case.
2 comments:
Hi sneak-you may remember me from periodic posts on TIE board- I put your blog on my favorites but honestly did not visit much until today-- you are a very thoughtful and obviously have a strong analytical mind - I was attracted to your report on SIRO- I am mostly a small cap story buyer with a closed end discretionary fund[ have 60 stocks at moment and I don't want to sell anything at the moment]- most good stories have a technological seed [sometimes you can be too early] but I confirm my interest by reqiring a confirmation evaluation judgment based on my own metrix of discounting eps growth rate as far out as I can find[ a slightly imprecise approach as it is based on First Call's consensus of analysts' ??estimates.With a couple of assumptions and imperical adjustments it works fairly well with me. Although an old co, I thought that SIRO might qualify as prospective purchase with its new technologies but it did not pass my valuation scheme coming up with a price around 36 1 year forward-- I am looking for prices 50-100%higher than current-
I have digressed into some concepts rather than individual stocks when there is some uncertainty who the big winner will be. Occasionally I go for a biotech where ther is no earnings[ e.g.CELG a +450%profit and still ln portfolio]. Presently my concepts are in Uranium [ 19 stock basket with producers to juniors] --had 40% profit in July now down to 12% loss but not discouraged-- am very impressed with the potential long term- actually starting to come back-- Best concept recently has been Solar Energy - 6 stock basket around +120% at present-- have had some discussions with Raybans but we are usually not on same wave length. Individual stocks that I like at moment are SIGM, ARAY, GBT and ACEL [ biotech cancer drug}
Never created a blog but do send out weekly free letter to 90+ friends et. who are interested in what I do. If interested in receiving last 2 issues send me your E-mail-- you can then decide whether you want to remain.
Personal background 82-retired- play golf or tennis 6 days a week[golf clubs in closet until Spring]-hence more time for investment DD-- have at home wife stricken with stroke 4 years ago so vacation and trips not in the cards. I rely a lot on expertise of others who know more than I can ever hope to know like you and other specific posters on IV.
In aerospace did well with TIE but no longer hold- have currently PCP and BEAV both with reasonably good results [especially PCP- +50%}
Sorry to make this so long but wanted to establih if possible relationship. Not into options or margin trading or shorting just part of the vanishing breed of long term investors.
Thanks for reading-----hey jose01915
Hey Jose:
Of course I remember you and thanks for posting. I follow your Uranium posts on the TIE board and appreciate it that you stay so active. I also live for spending time on the golf course.
I will send you my email through a PM on the IV Merssage Board.
SIRO has had a lot of ownership changes that makes modeling this stock nearly impossible (at least for me). This is a story stock with a high beta and a very predictable swing.
My best friend is a dentist and swears by the technology (the imaging system). This is a form of remote sensing that I also understand (I am in the geospatial business - hence GRMN and SIRO).
Anyway, best to you!
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