The company's first-quarter net sales rose 2.3 percent to $2.01 billion (1.5 percent decrease on a constant currency basis). Diluted earnings per share for the quarter were 85 cents, a 42.2 percent drop compared with the prior year period. Adjusted diluted earnings per share for the quarter were $1.91, a 10.3 percent slide compared with Q1 2011.
"As expected, in the first quarter our performance continued to reflect supply headwinds associated with key brands within our Knee, Hip, and S.E.T. portfolios, as well as the ongoing remediation work at our Warsaw North Campus facility," said Bryan Hanson, president and CEO of Zimmer Biomet. "As we look out over the course of the next 18 to 24 months, we will stay laser-focused on taking the necessary actions to narrow our gap to market and drive sustained shareholder value. These actions include successfully driving our ongoing quality remediation program, restoring supply, and scaling up the commercial launch of compelling new technologies, all of which remain on track."
Net earnings for the first quarter (ended March 31) were $174.7 million and $390.9 million on an adjusted basis. Operating cash flow for the first quarter was $490.5 million. Free cash flow in the quarter was $403.4 million.
In the first three months of 2018 the company paid $48.6 million in dividends and declared a first quarter dividend of 24 cents per share.
Revenue in North and South America slipped 1.8 percent to $1.208 billion, but the loss was more than offset by a 9.6 percent sales spike in Europe, Middle East and Africa (EMEA) to $497 million. Asia Pacific sales increased 8.2 percent to $313 million.
Knee proceeds mirrored the geographic results, falling 2.5 percent in the Americas (to $417 million) and rising throughout the rest of the world. Knee sales rose 12.4 percent in EMEA to $189 million and 2.3 percent to $107 million in Asia Pacific.
Hip sales, on the other hand, fared far better in the quarter, climbing 1.3 percent in the Americas, 4.5 percent in EMEA, and 9.5 percent in Asia Pacific.
Dental sales fell 0.2 percent to $108 million, while sports medicine, extremities and trauma (S.E.T.) revenue increased 4.4 percent to $443 million. Spine and craniomaxillofacial sales, however, fell 1.7 percent to $183 million.
Founded in 1927 and headquartered in Warsaw, Ind., Zimmer Biomet designs, manufactures, and markets orthopedic reconstructive products; sports medicine, biologics, extremities, and trauma products; office-based technologies; spine, craniomaxillofacial and thoracic products; dental implants; and related surgical products. The company’s products and solutions help patients suffering from disorders of, or injuries to, bones, joints, or supporting soft tissues. Zimmer Biomet has operations in more than 25 countries around the world and sells products in over 100 countries.