- Email: [email protected]
Cantel Medical Corp, USA
COMPANY WATCH
Donaldson Co Inc, USA
Cantel Medical Corp, USA
Key Figures (US$ million) First quarter ended 31.10 2016 2015
Net Sales Of Which: Water Purification & Filtration
187.7
153.8
49.9
44.7
Cost of Sales
98.2
Gross Profit R&D Expenses Operating Expenses
553.0
538.0
82.6
Net Sales Of Which: Engine Products Industrial Products
353.9 199.1
346.6 191.4
89.5
71.2
Cost of Sales
358.8
359.9
4.5
3.8
Gross Profit
194.2
178.1
62.4
47.4
Operating Expenses
117.8
122.6
Operating Income
76.4
55.5
Earnings before Income Taxes Of Which: Engine Products Industrial Products
79.7
53.4
45.4 38.3
36.0 24.0
Net Earnings
58.0
38.5
Operating Income Of Which: Water Purification & Filtration
35.7
29.3
8.9
7.8
Net Income/(Loss)
18.8
14.3
COMMENT Cantel Medical Corp has posted a 22.1% increase in first quarter sales to a record US$187.7 million, while its net income grew 32.5% to set another company high point of US$18.8 million. The company’s Water Purification & Filtration segment contributed to the positive performance with its sales increasing 11.5% year-onyear to US$49.9 million, all of which was organic. The segment’s growth was attributed to increased demand for dialysis equipment in the USA, as well as from commercial and industrial (large capital) applications. Growth was even stronger in Cantel’s other two segments, with revenues up 31.0% to US$93.8 million in the Endoscopy division to and 34.5% in the Healthcare Disposables sector to US$36.8 million. The overall sales growth (22.1%) was mainly organic (15.8%) with acquisitions contributing 7.2% and foreign currency translation having a negative impact of 0.9%. “All three of our major business segments had strong performance in the first quarter,”
January 2017
Key Figures (US$ million) First quarter ended 31.10 2016 2015
Jørgen Hansen, Cantel’s president and CEO, said. “Our continued investments in new product development, commercial programmes, as well as the integration of recent acquisitions, continue to drive our growth. These investments have helped us achieve double digit organic sales growth in 11 of the past 13 quarters.” Hansen said the increase in gross margin to 47.7%, up 140 basis points on the year earlier, was another positive and had been driven by a favourable shift in the product mix as well as continuous improvement efforts. Hansen expects that the Water Purification & Filtration segment will continue to perform well as the current year progresses. “As we have stated in past quarters, the strength of the overall backlog is now starting to impact growth positively,” he said. “This quarter, order intake continued to increase and our backlog reached record levels for the second consecutive quarter, positioning us well for the remainder of fiscal year 2017.” n www.cantelmedical.com
COMMENT Donaldson Co Inc has recorded net sales of US$553.0 million for the first quarter of fiscal 2017, a 2.8% improvement from the year earlier. Profitability was also up with operating income increasing 37.7% to US$76.4 million and net earnings 50.6% stronger at US$58.0 million. In the company’s Engine Products segment sales were 2.1% higher than the year earlier at US$353.9 million. Revenues were up 6.7% to US$247.9 million in the segment’s largest business unit, Aftermarket Products, reflecting increased demand from both OEM and independent sales channels, as well as a US$2.0 million incremental contribution from its recent acquisition Partmo. Sales were also up 4.2% to US$24.8 million in the segment’s Aerospace & Defense Products business unit, but fell 25.8% to US$26.5 million in its On-Road Products and by 0.2% to US$54.7 million in its OffRoad Products business areas. The Industrial Products segment followed a similar pattern with sales for the quarter rising 4.1% to US$199.1 million. The increase was driven
by an increase of 34.3% in the Gas Turbine Systems sector. Sales for both its Industrial Filtration Solutions and Special Application Products business units were essentially flat on the year earlier at US$126.3 million and US$40.3 million respectively. Donaldson reaffirmed its full-year sales guidance for fiscal 2017 with total company sales, as well as those for both of its reporting segments, expected to finish between a 2% decline and a 2% increase compared with 2016. “Our assessment of the overall environment remains somewhat mixed as recent signs of stability within our business are not yet translating to meaningful improvements in end-market conditions, so we are maintaining a cautious stance,” Tod Carpenter, Donaldson’s president and CEO, said. “At the same time, we are focused on our strategic priorities, which include leveraging our technology to win new first-fit programmes and actively pursuing growth in sales of replacement parts.” n www.donaldson.com
Filtration Industry Analyst
9
Donaldson Co Inc, USA
Cantel Medical Corp, USA
Key Figures (US$ million) First quarter ended 31.10 2016 2015
Net Sales Of Which: Water Purification & Filtration
187.7
153.8
49.9
44.7
Cost of Sales
98.2
Gross Profit R&D Expenses Operating Expenses
553.0
538.0
82.6
Net Sales Of Which: Engine Products Industrial Products
353.9 199.1
346.6 191.4
89.5
71.2
Cost of Sales
358.8
359.9
4.5
3.8
Gross Profit
194.2
178.1
62.4
47.4
Operating Expenses
117.8
122.6
Operating Income
76.4
55.5
Earnings before Income Taxes Of Which: Engine Products Industrial Products
79.7
53.4
45.4 38.3
36.0 24.0
Net Earnings
58.0
38.5
Operating Income Of Which: Water Purification & Filtration
35.7
29.3
8.9
7.8
Net Income/(Loss)
18.8
14.3
COMMENT Cantel Medical Corp has posted a 22.1% increase in first quarter sales to a record US$187.7 million, while its net income grew 32.5% to set another company high point of US$18.8 million. The company’s Water Purification & Filtration segment contributed to the positive performance with its sales increasing 11.5% year-onyear to US$49.9 million, all of which was organic. The segment’s growth was attributed to increased demand for dialysis equipment in the USA, as well as from commercial and industrial (large capital) applications. Growth was even stronger in Cantel’s other two segments, with revenues up 31.0% to US$93.8 million in the Endoscopy division to and 34.5% in the Healthcare Disposables sector to US$36.8 million. The overall sales growth (22.1%) was mainly organic (15.8%) with acquisitions contributing 7.2% and foreign currency translation having a negative impact of 0.9%. “All three of our major business segments had strong performance in the first quarter,”
January 2017
Key Figures (US$ million) First quarter ended 31.10 2016 2015
Jørgen Hansen, Cantel’s president and CEO, said. “Our continued investments in new product development, commercial programmes, as well as the integration of recent acquisitions, continue to drive our growth. These investments have helped us achieve double digit organic sales growth in 11 of the past 13 quarters.” Hansen said the increase in gross margin to 47.7%, up 140 basis points on the year earlier, was another positive and had been driven by a favourable shift in the product mix as well as continuous improvement efforts. Hansen expects that the Water Purification & Filtration segment will continue to perform well as the current year progresses. “As we have stated in past quarters, the strength of the overall backlog is now starting to impact growth positively,” he said. “This quarter, order intake continued to increase and our backlog reached record levels for the second consecutive quarter, positioning us well for the remainder of fiscal year 2017.” n www.cantelmedical.com
COMMENT Donaldson Co Inc has recorded net sales of US$553.0 million for the first quarter of fiscal 2017, a 2.8% improvement from the year earlier. Profitability was also up with operating income increasing 37.7% to US$76.4 million and net earnings 50.6% stronger at US$58.0 million. In the company’s Engine Products segment sales were 2.1% higher than the year earlier at US$353.9 million. Revenues were up 6.7% to US$247.9 million in the segment’s largest business unit, Aftermarket Products, reflecting increased demand from both OEM and independent sales channels, as well as a US$2.0 million incremental contribution from its recent acquisition Partmo. Sales were also up 4.2% to US$24.8 million in the segment’s Aerospace & Defense Products business unit, but fell 25.8% to US$26.5 million in its On-Road Products and by 0.2% to US$54.7 million in its OffRoad Products business areas. The Industrial Products segment followed a similar pattern with sales for the quarter rising 4.1% to US$199.1 million. The increase was driven
by an increase of 34.3% in the Gas Turbine Systems sector. Sales for both its Industrial Filtration Solutions and Special Application Products business units were essentially flat on the year earlier at US$126.3 million and US$40.3 million respectively. Donaldson reaffirmed its full-year sales guidance for fiscal 2017 with total company sales, as well as those for both of its reporting segments, expected to finish between a 2% decline and a 2% increase compared with 2016. “Our assessment of the overall environment remains somewhat mixed as recent signs of stability within our business are not yet translating to meaningful improvements in end-market conditions, so we are maintaining a cautious stance,” Tod Carpenter, Donaldson’s president and CEO, said. “At the same time, we are focused on our strategic priorities, which include leveraging our technology to win new first-fit programmes and actively pursuing growth in sales of replacement parts.” n www.donaldson.com
Filtration Industry Analyst
9