Full Press Release Details
| NEWS RELEASE | |
| CONTACT : | |
| CONMED Corporation | |
| Luke A. Pomilio | |
| Chief Financial Officer | |
| 315-624-3202 | |
| LukePomilio@conmed.com |
CONMED Corporation Announces
Fourth Quarter and Fiscal Year 2016
Utica, New York, February
1, 2017 --- CONMED Corporation (Nasdaq: CNMD) today announced financial results for the fourth quarter and fiscal year ended
Fourth Quarter 2016 Highlights
Fiscal Year 2016 Highlights
"Our International business
and the domestic General Surgery category, which represent 78% of our total revenue, exited the year with positive momentum. Overall,
we are demonstrating consistent and improving performance across these areas. Clearly, these successes were offset by ongoing challenges
in domestic Orthopedics, where we believe we are taking the appropriate steps to drive improvement in this business
over the coming quarters," commented Curt R. Hartman, CONMED's President and Chief Executive Officer.
For the quarter ended December
31, 2016, domestic sales, which represented 51.5% of total revenue, increased 7.6%, despite declines in Orthopedics and Visualization,
due to continued strength in General Surgery, as the SurgiQuest acquisition and organic growth contributed to 33.4% year-over-year
growth in the business. International sales, which represented 48.5% of total revenue, increased 6.0% compared to the fourth quarter
of 2015 on a reported basis. Foreign currency exchange rates, including the effects of the FX hedging program, had a negative impact
of $4.4 million on fourth quarter sales. In constant currency, international sales increased 10.7% versus the prior-year period.
For the fiscal year ended
December 31, 2016, domestic sales, which represented 52.3% of total revenue, increased 10.4% as positive results in General Surgery,
driven by AirSeal sales growth, were partially offset by weaker than expected sales in Orthopedics and, to a lesser
extent, Visualization. International sales, which represented 47.7% of total revenue, increased 1.9% compared to 2015 on a reported
basis. Foreign currency exchange rates, including the effects of the FX hedging program, had a negative impact of $17.3 million
on fiscal year 2016 sales. In constant currency, international sales increased 6.7% versus the prior-year period.
For the quarter ended December
31, 2016, reported net earnings totaled $6.7 million, compared to reported net earnings of $7.9 million a year ago. Reported diluted
net earnings per share were $0.24 in the quarter, compared to reported diluted net earnings per share of $0.28 in the prior-year
period. Reported net earnings for both 2016 and 2015 include business acquisition and restructuring costs. The effect of each of
these items on reported net earnings and reported diluted net earnings per share appears in the reconciliation of GAAP to non-GAAP
The Company excludes the
after-tax costs of special items including acquisitions, restructuring, the gain on the sale of an asset and debt refinancing,
as well as amortization of intangible assets, net of tax, from its adjusted diluted net earnings per share. Excluding the impact
of these items, adjusted net earnings(2) of $15.1 million decreased 8.8% year over year and adjusted diluted net earnings
per share(1) of $0.54 decreased 10.0% year over year. The decrease in adjusted net earnings resulted primarily from
unfavorable impact of foreign exchange rates, partially offset by a lower tax rate during the quarter.
For the fiscal year ended
December 31, 2016, reported net earnings totaled $14.7 million, compared to reported net earnings of $30.5 million in the prior
year. Reported diluted net earnings per share were $0.52, compared to $1.09 in the prior-year period. Excluding the impact of the
special items as described above and as provided in the reconciliation of GAAP to non-GAAP measures below, adjusted net earnings(2)
of $51.4 million decreased 6.4% year over year and adjusted diluted net earnings per share(1) of $1.84 decreased 7.1%
from the prior year.
The Company expects 2017
constant currency sales growth in the range of 1% to 3%. Based on exchange rates as of January 27, 2017, the negative impact to
2017 sales from foreign exchange is anticipated to be approximately 0.5%.
In addition, the Company
forecasts adjusted diluted net earnings per share in the range of $1.85 to $1.95, which includes an estimated negative impact from
foreign exchange based on exchange rates as of January 27, 2017. The adjusted diluted net earnings per share estimates for 2017
exclude the cost of special items including acquisition costs and restructuring costs, which are estimated in the range of $8.0
to $10.0 million, net of tax, and amortization of intangible assets, which are estimated in the range of $12 to $14 million, net
Supplemental Financial
(1) A reconciliation
of reported diluted net earnings per share to adjusted diluted net earnings per share, a non-GAAP financial measure, appears below.
(2) A reconciliation
of reported net earnings to adjusted net earnings, a non-GAAP financial measure, appears below.
this earnings press release, CONMED has prepared a supplemental financial disclosure, which is available on the home page of the
"Investors - Financial Reports" section of the Company's website at www.conmed.com.
The Company's management
will host a conference call today at 4:30 p.m. ET to discuss its fourth quarter and fiscal year 2016 results.
To participate in the conference
call, dial 844-889-7792 (domestic) or 661-378-9936 (international)
and enter the passcode 46955565.
This conference call will
also be webcast and can be accessed from the "Investors" section of CONMED's web site at www.conmed.com.
The webcast replay of the call will be available at the same site approximately one hour after the end of the call.
A recording of the call will
also be available from 7:30 p.m. ET on Wednesday, February 1, 2017, until 7:30 p.m. ET on Wednesday, February 15, 2017. To hear
this recording, dial 855-859-2056 (domestic) or 404-537-3406 (international) and enter the passcode 46955565.
About CONMED Corporation
CONMED is a medical technology
company that provides surgical devices and equipment for minimally invasive procedures. The Company's products are used
by surgeons and physicians in a variety of specialties, including orthopedics, general surgery, gynecology, neurosurgery and gastroenterology.
The Company distributes its products worldwide from several manufacturing locations. CONMED has a direct selling presence in 17
countries, and international sales constitute approximately 50% of the Company's total sales. Headquartered in Utica, New
York, the Company employs approximately 3,300 people. For more information, visit www.conmed.com.
Forward-Looking Statements
This press release and today's
conference call may contain forward-looking statements based on certain assumptions and contingencies that involve risks and uncertainties,
which could cause actual results, performance, or trends to differ materially from those expressed in the forward-looking statements
herein or in previous disclosures. For example, in addition to general industry and economic conditions, factors that could cause
actual results to differ materially from those in the forward-looking statements may include, but are not limited to, the risk
factors discussed in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2015. Any and all forward-looking
statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and relate to
the Company's performance on a going-forward basis. The Company believes that all forward-looking statements made by it have
a reasonable basis, but there can be no assurance that management's expectations, beliefs or projections as expressed in
the forward-looking statements will actually occur or prove to be correct.
Supplemental Information
- Reconciliation of GAAP to Non-GAAP Financial Measures
The Company supplements the
reporting of its financial information determined under accounting principles generally accepted in the United States (GAAP) with
certain non-GAAP financial measures, including percentage sales growth in constant currency; adjusted gross profit; cost of sales
excluding specified items; adjusted selling and administrative expenses; adjusted operating income; adjusted income tax expense;
adjusted effective income tax rate; adjusted net earnings and adjusted diluted net earnings per share (EPS). The Company believes
that these non-GAAP measures provide meaningful information to assist investors and shareholders in understanding our financial
results and assessing our prospects for future performance. Management believes percentage sales growth in constant currency and
the other adjusted measures described above are important indicators of our operations because they exclude items that may not
be indicative of, or are unrelated to, our core operating results and provide a baseline for analyzing trends in the Company's
underlying business. Further, the presentation of EBITDA is a non-GAAP measurement that management considers useful for measuring
aspects of the Company's cash flow. Management uses these non-GAAP financial measures for reviewing the operating results
and analyzing potential future business trends in connection with our budget process and bases certain management incentive compensation
on these non-GAAP financial measures.