Biomet Releases Fiscal 2013 Financial Report

Fair Lawn, N.J.-based Biomet Inc. has released its financial report for fiscal year 2013, which ended on May 31, 2013. While sales increased, the company experienced a greater loss in 2013 than in 2011. Spending on cost of sales, administrative expenses and research and development all increased in 2013. The company also saw a $567.4 million non-cash goodwill and intangible asset impairment charge related to its dental reconstructive and Europe reporting units.

Biomet’s large joint reconstructive business saw net sales of $435.2 million for the fourth quarter of 2013, a 1 percent decrease from the same quarter last year. Hips, though still showing a decrease in growth, was the strongest performer in the unit. Spine and bone healing brought in $67 million for the quarter, decreasing a full 18.2 percent from the same quarter last year. Sports, extremities and trauma (SET) was the only business unit that showed growth on the quarter, brining in net sales of $159.2 million to 2012 Q4’s $98.2 million, a growth of 62.1 percent.

“Our combined hip and knee constant currency growth of 2 percent for the year was generally in line with the market—not to our standard of clear above market growth, but we’re working on the product introductions that we believe will return us to that standard,” said Biomet’s President and CEO Jeffrey R. Binder. “We believe that our large joint reconstructive business provides us with a strong and stable base and we disagree strongly with those who believe that there are few opportunities for innovation and differentiation. We’re working hard to prove the naysayers wrong.”

Year on year, SET was still the strongest performer in terms of growth, totaling $600.1 million in FY2013 compared to $361.6 million in FY2012. Contributing to the exponential growth of the unit is undoubtedly the acquisition of DePuy Trauma, which was complete in June 2012.

Despite posting a decrease in growth, large joint is still Biomet’s largest business unit, bringing in net sales of $1.696.3 million in FY2013 compared to FY2012’s $1,698.8 million.

“Fiscal 2013 was a very important year for our SET franchise, which had a fabulous year” continued Binder. “We began the phased closing of our trauma acquisition last June and the team did a great job with the execution of the integration throughout the year. Overall, SET sales reached $600 million for the full fiscal year, representing 20 percent of our worldwide consolidated net sales. Even if we exclude the trauma acquisition from our results, our full fiscal year SET sales still grew at a rate of greater than 10 percent at constant currency, led by continued strong double digit growth in our extremities product line. In fact, we believe that Biomet will be the number one shoulder replacement company in the United States in calendar 2013. We’re encouraged by the momentum in our SET and microfixation businesses during fiscal year 2013 and we’re excited by the growth potential we see in our spine, dental and biologics businesses.”

Reported net loss during the year ended May 31, 2013 was $623.4 million, compared to a net loss of $458.8 million during the year ended May 31, 2012. Excluding special items, adjusted net income totaled $368.0 million during FY2013, compared to $251.8 million in FY2012.