Owens & Minor Reports Second Quarter 2024 Financial Results
Owens & Minor (NYSE: OMI) reported Q2 2024 financial results with consolidated revenue of $2.7 billion, up 4% year-over-year. The company posted a net loss of $(32) million or $(0.42) per share, but doubled its adjusted earnings per share to $0.36. Adjusted EBITDA grew 12% to $127 million. Key highlights include:
- Patient Direct revenue up 4% to $660 million
- Products & Healthcare Services revenue up 4% to $2.0 billion
- Operating cash flow of $116 million, enabling $71 million debt reduction
- Announced agreement to acquire Rotech Healthcare Holdings
OMI reaffirmed its 2024 guidance, projecting revenue of $10.5-$10.9 billion and adjusted EBITDA of $550-$590 million. The company recorded a one-time tax charge of $17 million related to past transfer pricing methodology.
Owens & Minor (NYSE: OMI) ha riportato i risultati finanziari del Q2 2024 con ricavi consolidati di 2,7 miliardi di dollari, in aumento del 4% rispetto all'anno precedente. L'azienda ha registrato una perdita netta di $(32) milioni o $(0,42) per azione, ma ha raddoppiato i suoi utili per azione rettificati a $0,36. EBITDA rettificato è cresciuto del 12% a $127 milioni. I punti salienti includono:
- Ricavi Patient Direct in aumento del 4% a $660 milioni
- Ricavi da Prodotti e Servizi Sanitari in aumento del 4% a $2,0 miliardi
- Flusso di cassa operativo di $116 milioni, che consente una riduzione del debito di $71 milioni
- Annuncio dell'accordo per acquisire Rotech Healthcare Holdings
OMI ha riaffermato le sue previsioni per il 2024, proiettando ricavi di $10,5-$10,9 miliardi e un EBITDA rettificato di $550-$590 milioni. L'azienda ha registrato un'imposta straordinaria di $17 milioni relativa a metodologie di prezzo di trasferimento passate.
Owens & Minor (NYSE: OMI) informó los resultados financieros del Q2 2024 con ingresos consolidados de 2.7 mil millones de dólares, un aumento del 4% interanual. La empresa reportó una pérdida neta de $(32) millones o $(0.42) por acción, pero duplicó sus ganancias ajustadas por acción a $0.36. EBITDA ajustado creció un 12% hasta $127 millones. Los puntos destacados incluyen:
- Ingresos de Patient Direct aumentaron un 4% a $660 millones
- Ingresos de Productos y Servicios de Salud aumentaron un 4% a $2.0 mil millones
- Flujo de caja operativo de $116 millones, lo que permitió una reducción de deuda de $71 millones
- Anuncio de un acuerdo para adquirir Rotech Healthcare Holdings
OMI reafirmó su guía para 2024, proyectando ingresos de $10.5-$10.9 mil millones y un EBITDA ajustado de $550-$590 millones. La empresa registró un cargo impositivo único de $17 millones relacionado con metodologías de precios de transferencia pasadas.
Owens & Minor (NYSE: OMI)는 2024년 2분기 재무 결과를 발표했으며, 통합 수익은 27억 달러로, 전년 대비 4% 증가했습니다. 회사는 $(32)백만 또는 주당 $(0.42)의 순손실을 기록했지만, 조정된 주당 순이익을 $0.36으로 두 배로 늘렸습니다. 조정된 EBITDA는 12% 증가하여 $127백만에 달했습니다. 주요 하이라이트는 다음과 같습니다:
- Patient Direct 수익이 4% 증가하여 $660백만
- 제품 및 건강 관리 서비스 수익이 4% 증가하여 $20억
- 운영 현금 흐름이 $116백만으로, $71백만의 부채 감소를 가능하게 함
- Rotech Healthcare Holdings 인수를 위한 계약 발표
OMI는 2024년 가이던스를 재확인하며, $10.5-$10.9억의 수익과 $550-$590백만의 조정 EBITDA를 예상했습니다. 회사는 과거 이전 가격 책정 방법론과 관련하여 $17백만의 일회성 세금 부담을 기록했습니다.
Owens & Minor (NYSE: OMI) a publié ses résultats financiers du T2 2024 avec un chiffre d'affaires consolidé de 2,7 milliards de dollars, en hausse de 4 % par rapport à l'année précédente. L'entreprise a enregistré une perte nette de $(32) millions ou $(0,42) par action, mais a doublé son bénéfice par action ajusté à $0,36. EBITDA ajusté a augmenté de 12 % pour atteindre $127 millions. Les points forts incluent :
- Revenu Patient Direct en hausse de 4 % à $660 millions
- Revenu des Produits et Services de Santé en hausse de 4 % à $2,0 milliards
- Flux de trésorerie opérationnel de $116 millions, permettant une réduction de la dette de $71 millions
- Annonce d'un accord pour acquérir Rotech Healthcare Holdings
OMI a réaffirmé ses prévisions pour 2024, projetant un chiffre d'affaires de $10,5-$10,9 milliards et un EBITDA ajusté de $550-$590 millions. L'entreprise a enregistré une charge fiscale unique de $17 millions liée à des méthodologies de transfert de prix passées.
Owens & Minor (NYSE: OMI) hat die Finanzergebnisse für Q2 2024 veröffentlicht, mit konsolidierten Einnahmen von 2,7 Milliarden Dollar, was einem Anstieg von 4 % im Vergleich zum Vorjahr entspricht. Das Unternehmen verzeichnete einen Nettoverlust von $(32) Millionen oder $(0,42) pro Aktie, hat jedoch seinen bereinigten Gewinn pro Aktie auf $0,36 verdoppelt. Bereinigtes EBITDA wuchs um 12 % auf $127 Millionen. Zu den wichtigsten Highlights gehören:
- Patient Direct-Einnahmen stiegen um 4 % auf $660 Millionen
- Produkte und Gesundheitsdienstleistungen stiegen um 4 % auf $2,0 Milliarden
- Operativer Cashflow von $116 Millionen, wodurch eine Schuldenreduzierung von $71 Millionen möglich wurde
- Ankündigung des Vertrags zur Akquisition von Rotech Healthcare Holdings
OMI bestätigte seine Prognose für 2024 und erwartet Einnahmen von $10,5-$10,9 Milliarden und ein bereinigtes EBITDA von $550-$590 Millionen. Das Unternehmen verzeichnete eine einmalige Steuerbelastung von $17 Millionen im Zusammenhang mit früheren Verrechnungspreismethodologien.
- Consolidated revenue increased 4% year-over-year to $2.7 billion
- Adjusted EBITDA grew 12% to $127 million
- Adjusted earnings per share doubled from $0.18 to $0.36
- Operating cash flow improved by $169 million compared to Q1 2024
- Debt reduction of $71 million in Q2 2024
- Agreement to acquire Rotech Healthcare Holdings, expanding Patient Direct segment
- Net loss of $(32) million or $(0.42) per share in Q2 2024
- One-time income tax charge of $17 million ($0.22 per share) related to past transfer pricing methodology
- Expected cash payment of $30-$35 million in second half of the year due to tax matter
Insights
Owens & Minor's Q2 2024 results present a mixed picture. While the company achieved revenue growth of 4% year-over-year to
- Adjusted EBITDA increased by
12% to$127 million - Adjusted earnings per share doubled from
$0.18 to$0.36 - Operating cash flow improved significantly to
$116 million , enabling$71 million in debt reduction
The company's segments show promise, with Patient Direct revenue up
However, investors should note the
The company's 2024 outlook remains unchanged, projecting revenue between
Overall, while Owens & Minor is showing signs of improvement, the persistent net losses and one-time charges indicate ongoing challenges that warrant close monitoring by investors.
Owens & Minor's Q2 results reflect broader trends in the healthcare supply chain and distribution sector. The
The Patient Direct segment's performance, particularly in diabetes and sleep supplies, aligns with the growing trend of home healthcare and chronic disease management. The planned acquisition of Rotech Healthcare Holdings further emphasizes the company's focus on this high-growth area, potentially positioning Owens & Minor to capitalize on the shift towards home-based care.
In the Products & Healthcare Services segment, the growth driven by strong same-store sales and new wins in Medical Distribution suggests a competitive edge in a challenging market. This could indicate effective strategies in customer retention and acquisition, important in a sector facing pricing pressures and supply chain complexities.
The company's ability to generate
However, the persistent net losses and the impact of the tax issue highlight the ongoing challenges in maintaining profitability in this sector. The company's focus on adjusted metrics suggests there may be underlying structural issues that need addressing for long-term sustainable growth.
Investors should closely monitor how Owens & Minor navigates the evolving healthcare landscape, particularly in balancing growth investments with profitability improvements.
Top Line Expansion Driven by Solid Growth in Both Segments
Second Quarter Operating Cash Flow of
Expanding Patient Direct Segment with Agreement to Acquire Rotech Healthcare Holdings
Key Highlights:
-
Consolidated revenue of
$2.7 billion 4% -
Net loss of
$(32) million $(0.42) -
Adjusted EBITDA of
$127 million 12% -
Doubled second quarter year over year Adjusted earnings per share from
$0.18 $0.36
“Our second-quarter performance is consistent with our expectations, as we are in the early stages of implementing our long-term strategy discussed at Investor Day in December 2023. Our previous investments in our Products & Healthcare Services segment yielded positive results and generated top-line growth in our Medical Distribution division. Our Patient Direct segment performed in line with our expectations, and we expect the segment to benefit from seasonality and recent organic investments during the back half of the year,” said Edward A. Pesicka, President & Chief Executive Officer of Owens & Minor.
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Financial Summary (1) |
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YTD |
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YTD |
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($ in millions, except per share data) |
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2Q24 |
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2Q23 |
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2024 |
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2023 |
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Revenue |
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$ |
2,671 |
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$ |
2,563 |
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$ |
5,284 |
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$ |
5,086 |
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Operating income, GAAP |
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$ |
20.3 |
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$ |
10.8 |
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$ |
30.0 |
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$ |
20.6 |
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Adj. Operating Income, Non-GAAP |
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$ |
76.3 |
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$ |
62.0 |
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$ |
133.6 |
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$ |
109.7 |
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Net loss, GAAP |
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$ |
(31.9 |
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$ |
(28.2 |
) |
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$ |
(53.8 |
) |
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$ |
(52.7 |
) |
Adj. Net Income, Non-GAAP |
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$ |
28.2 |
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$ |
14.2 |
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$ |
43.0 |
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$ |
17.8 |
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Adj. EBITDA, Non-GAAP |
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$ |
126.8 |
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$ |
112.8 |
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$ |
243.1 |
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$ |
221.5 |
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Net loss per common share, GAAP |
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$ |
(0.42 |
) |
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$ |
(0.37 |
) |
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$ |
(0.70 |
) |
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$ |
(0.70 |
) |
Adj. Net Income per share, Non-GAAP |
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$ |
0.36 |
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$ |
0.18 |
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$ |
0.55 |
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$ |
0.23 |
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(1) Reconciliations of the differences between the non-GAAP financial measures presented in this release and their most directly comparable GAAP financial measures are included in the tables below.
Results and Business Highlights
-
Consolidated revenue of
$2.7 billion 4% compared to the second quarter of 2023-
Patient Direct revenue of
$660 million 4% compared to the second quarter of 2023 driven by continued strong growth in diabetes and sleep supplies -
Products & Healthcare Services revenue of
$2.0 billion 4% compared to the second quarter of 2023 driven by strong same store sales and new wins in our Medical Distribution division
-
Patient Direct revenue of
-
Second quarter 2024 operating income of
$20.3 million $76.3 million -
Operating income grew by
87% and Adjusted Operating Income grew by23% compared to the prior year
-
Operating income grew by
-
Net loss of
$(32) million $28 million -
Adjusted EBITDA of
$127 million 12%
-
Adjusted EBITDA of
-
Operating cash flow for the second quarter of 2024 was
$116 million -
Increased by
$169 million -
Enabled
$71 million
-
Increased by
Tax Matter
In the second quarter of 2024, the Company recorded a one-time income tax charge of
2024 Financial Outlook
The Company’s recently reaffirmed financial guidance; summarized below:
-
Revenue for 2024 to be in a range of
$10.5 billion $10.9 billion -
Adjusted EBITDA for 2024 to be in a range of
$550 million $590 million -
Adjusted EPS for 2024 to be in a range of
$1.40 $1.70
The Company’s outlook for 2024 contains assumptions, including current expectations regarding the impact of general economic conditions, including inflation, and the continuation of pressure on pricing and demand in our Products & Healthcare Services segment. Key assumptions supporting the Company’s 2024 financial guidance include:
-
Gross margin rate of
21.0% to21.5% -
Interest expense of
$141 $146 million -
Adjusted effective tax rate of
27.5% to28.5% - Diluted weighted average shares of ~78.5 million
-
Capital expenditures of
$220 $240 million - Stable commodity prices
- FX rates as of 12/31/2023
Although the Company does provide guidance for adjusted EBITDA and adjusted EPS (which are non-GAAP financial measures), it is not able to forecast the most directly comparable measures calculated and presented in accordance with GAAP without unreasonable effort. Certain elements of the composition of the GAAP amounts are not predictable, making it impracticable for the Company to forecast. Such elements include, but are not limited to, restructuring and acquisition charges, which could have a significant and unpredictable impact on our GAAP results. As a result, no GAAP guidance or reconciliation of the Company’s adjusted EBITDA guidance or adjusted EPS guidance is provided. The outlook is based on certain assumptions that are subject to the risk factors discussed in the Company’s filings with the SEC.
Investor Conference Call for Second Quarter 2024 Financial Results
Owens & Minor executives will host a conference call for investors and analysts on Friday, August 2, 2024, at 8:30 a.m. EDT. Participants may access the call via the toll-free dial-in number at 1-888-300-2035, or the toll dial-in number at 1-646-517-7437. The conference ID access code is 1058917.
All interested stakeholders are encouraged to access the simultaneous live webcast by visiting the investor relations page of the Owens & Minor website available at investors.owens-minor.com/events-and-presentations/. A replay of the webcast can be accessed following the presentation at the link provided above.
Safe Harbor
This release is intended to be disclosure through methods reasonably designed to provide broad, non-exclusionary distribution to the public in compliance with the SEC's Fair Disclosure Regulation. This release contains certain ''forward-looking'' statements made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, the statements in this release regarding our future prospects and performance, including our expectations with respect to our 2024 financial performance, our Operating Model Realignment Program and other cost-saving initiatives, future indebtedness and growth, industry trends, as well as statements related to our expectations regarding the performance of our business, including the results of our Operating Model Realignment Program and our ability to address macro and market conditions. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results in future periods to differ materially from those projected or contemplated in the forward-looking statements. Investors should refer to Owens & Minor’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 20, 2024, including the sections captioned “Cautionary Note Regarding Forward-Looking Statements” and “Item 1A. Risk Factors,” and subsequent quarterly reports on Form 10-Q and current reports on Form 8-K filed with or furnished to the SEC, for a discussion of certain known risk factors that could cause the Company’s actual results to differ materially from its current estimates. These filings are available at www.owens-minor.com. Given these risks and uncertainties, Owens & Minor can give no assurance that any forward-looking statements will, in fact, transpire and, therefore, cautions investors not to place undue reliance on them. Owens & Minor specifically disclaims any obligation to update or revise any forward-looking statements, whether as a result of new information, future developments or otherwise.
About Owens & Minor
Owens & Minor, Inc. (NYSE: OMI) is a Fortune 500 global healthcare solutions company providing essential products and services that support care from the hospital to the home. For over 100 years, Owens & Minor and its affiliated brands, Apria®, Byram® and HALYARD*, have helped to make each day better for the patients, providers, and communities we serve. Powered by more than 20,000 teammates worldwide, Owens & Minor delivers comfort and confidence behind the scenes so healthcare stays at the forefront. Owens & Minor exists because every day, everywhere, Life Takes Care™. For more information about Owens & Minor and our affiliated brands, visit owens-minor.com or follow us on LinkedIn and Instagram.
*Registered Trademark or Trademark of O&M Halyard or its affiliates.
Owens & Minor, Inc. |
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Consolidated Statements of Operations (unaudited) |
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(dollars in thousands, except per share data) |
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Three Months Ended June 30, |
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2024 |
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2023 |
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Net revenue |
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$ |
2,671,006 |
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$ |
2,563,226 |
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Cost of goods sold |
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2,126,853 |
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2,043,794 |
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Gross profit |
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544,153 |
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519,432 |
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Distribution, selling and administrative expenses |
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469,313 |
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455,030 |
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Acquisition-related charges and intangible amortization |
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19,985 |
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22,203 |
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Exit and realignment charges, net |
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29,293 |
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28,963 |
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Other operating expense, net |
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5,263 |
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2,397 |
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Operating income |
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20,299 |
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10,839 |
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Interest expense, net |
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35,899 |
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40,728 |
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Other expense, net |
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1,205 |
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1,072 |
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Loss before income taxes |
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(16,805 |
) |
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(30,961 |
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Income tax provision (benefit) |
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15,108 |
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(2,720 |
) |
Net loss |
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$ |
(31,913 |
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$ |
(28,241 |
) |
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Net loss per common share: |
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Basic |
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$ |
(0.42 |
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$ |
(0.37 |
) |
Diluted |
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$ |
(0.42 |
) |
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$ |
(0.37 |
) |
Owens & Minor, Inc. |
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Consolidated Statements of Operations (unaudited) |
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(i) (dollars in thousands, except per share data) |
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Six Months Ended June 30, |
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2024 |
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2023 |
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Net revenue |
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$ |
5,283,686 |
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$ |
5,086,075 |
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Cost of goods sold |
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4,204,003 |
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4,069,336 |
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Gross profit |
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1,079,683 |
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1,016,739 |
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Distribution, selling and administrative expenses |
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946,926 |
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903,752 |
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Acquisition-related charges and intangible amortization |
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40,298 |
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44,392 |
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Exit and realignment charges, net |
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56,649 |
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44,637 |
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Other operating expense, net |
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5,815 |
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3,312 |
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Operating income |
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29,995 |
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20,646 |
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Interest expense, net |
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71,554 |
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82,926 |
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Other expense, net |
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2,358 |
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2,458 |
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Loss before income taxes |
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(43,917 |
) |
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(64,738 |
) |
Income tax benefit (provision) |
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9,882 |
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(12,079 |
) |
Net loss |
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$ |
(53,799 |
) |
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$ |
(52,659 |
) |
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Net loss per common share: |
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Basic |
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$ |
(0.70 |
) |
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$ |
(0.70 |
) |
Diluted |
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$ |
(0.70 |
) |
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$ |
(0.70 |
) |
Owens & Minor, Inc. |
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Condensed Consolidated Balance Sheets (unaudited) |
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(dollars in thousands) |
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June 30, |
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December 31, |
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2024 |
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2023 |
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Assets |
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Current assets |
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Cash and cash equivalents |
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$ |
243,671 |
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$ |
243,037 |
Accounts receivable, net |
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662,444 |
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598,257 |
Merchandise inventories |
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1,231,413 |
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1,110,606 |
Other current assets |
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189,542 |
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150,890 |
Total current assets |
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2,327,070 |
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2,102,790 |
Property and equipment, net |
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493,075 |
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543,972 |
Operating lease assets |
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368,471 |
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296,533 |
Goodwill |
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1,634,723 |
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1,638,846 |
Intangible assets, net |
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326,173 |
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|
361,835 |
Other assets, net |
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154,492 |
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|
149,346 |
Total assets |
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$ |
5,304,004 |
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$ |
5,093,322 |
Liabilities and equity |
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Current liabilities |
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Accounts payable |
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$ |
1,381,871 |
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$ |
1,171,882 |
Accrued payroll and related liabilities |
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|
108,103 |
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116,398 |
Current portion of long-term debt |
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210,913 |
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206,904 |
Other current liabilities |
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430,298 |
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|
396,701 |
Total current liabilities |
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2,131,185 |
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|
1,891,885 |
Long-term debt, excluding current portion |
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|
1,871,800 |
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|
1,890,598 |
Operating lease liabilities, excluding current portion |
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|
297,728 |
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|
222,429 |
Deferred income taxes, net |
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|
28,900 |
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|
41,652 |
Other liabilities |
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|
113,689 |
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|
122,592 |
Total liabilities |
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|
4,443,302 |
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|
4,169,156 |
Total equity |
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|
860,702 |
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|
924,166 |
Total liabilities and equity |
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$ |
5,304,004 |
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$ |
5,093,322 |
Owens & Minor, Inc. |
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Consolidated Statements of Cash Flows (unaudited) |
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(dollars in thousands) |
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Three Months Ended June 30, |
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2024 |
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2023 |
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Operating activities: |
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Net loss |
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$ |
(31,913 |
) |
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$ |
(28,241 |
) |
Adjustments to reconcile net loss to cash provided by operating activities: |
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Depreciation and amortization |
|
|
63,879 |
|
|
|
72,062 |
|
Share-based compensation expense |
|
|
6,735 |
|
|
|
5,212 |
|
Provision (benefit) for losses on accounts receivable |
|
|
143 |
|
|
|
(379 |
) |
Loss on extinguishment of debt |
|
|
— |
|
|
|
279 |
|
Deferred income tax benefit |
|
|
(5,370 |
) |
|
|
(6,167 |
) |
Changes in operating lease right-of-use assets and lease liabilities |
|
|
2,627 |
|
|
|
(2,852 |
) |
Gain on sale and dispositions of property and equipment |
|
|
(12,257 |
) |
|
|
(10,294 |
) |
Changes in operating assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
6,702 |
|
|
|
84,963 |
|
Merchandise inventories |
|
|
(87,665 |
) |
|
|
119,819 |
|
Accounts payable |
|
|
150,445 |
|
|
|
29,077 |
|
Net change in other assets and liabilities |
|
|
20,100 |
|
|
|
46,471 |
|
Other, net |
|
|
2,723 |
|
|
|
3,162 |
|
Cash provided by operating activities |
|
|
116,149 |
|
|
|
313,112 |
|
Investing activities: |
|
|
|
|
|
|
||
Additions to property and equipment |
|
|
(44,382 |
) |
|
|
(46,600 |
) |
Additions to computer software |
|
|
(1,418 |
) |
|
|
(2,889 |
) |
Proceeds from sale of property and equipment |
|
|
17,488 |
|
|
|
18,423 |
|
Other, net |
|
|
(6,858 |
) |
|
|
(418 |
) |
Cash used for investing activities |
|
|
(35,170 |
) |
|
|
(31,484 |
) |
Financing activities: |
|
|
|
|
|
|
||
Borrowings under amended Receivables Financing Agreement |
|
|
462,300 |
|
|
|
116,100 |
|
Repayments under amended Receivables Financing Agreement |
|
|
(528,000 |
) |
|
|
(116,100 |
) |
Repayments of term loans |
|
|
(7,750 |
) |
|
|
(51,801 |
) |
Other, net |
|
|
(4,790 |
) |
|
|
(3,830 |
) |
Cash used for financing activities |
|
|
(78,240 |
) |
|
|
(55,631 |
) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
|
(64 |
) |
|
|
(88 |
) |
Net increase in cash, cash equivalents and restricted cash |
|
|
2,675 |
|
|
|
225,909 |
|
Cash, cash equivalents and restricted cash at beginning of period |
|
|
270,794 |
|
|
|
83,194 |
|
Cash, cash equivalents and restricted cash at end of period(1) |
|
$ |
273,469 |
|
|
$ |
309,103 |
|
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
||
Income taxes paid (received), net |
|
$ |
2,875 |
|
|
$ |
(12,911 |
) |
Interest paid |
|
$ |
52,608 |
|
|
$ |
46,089 |
|
Noncash investing activity: |
|
|
|
|
|
|
||
Unpaid purchases of property and equipment and computer software at end of period |
|
$ |
76,373 |
|
|
$ |
65,808 |
|
(1) Restricted cash as of June 30, 2024 and March 31, 2024 was
Owens & Minor, Inc. |
||||||||
Consolidated Statements of Cash Flows (unaudited) |
||||||||
(dollars in thousands) |
||||||||
|
|
|
|
|
|
|
||
|
|
Six Months Ended June 30, |
||||||
|
|
2024 |
|
2023 |
||||
Operating activities: |
|
|
|
|
|
|
||
Net loss |
|
$ |
(53,799 |
) |
|
$ |
(52,659 |
) |
Adjustments to reconcile net loss to cash provided by operating activities: |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
137,974 |
|
|
|
142,988 |
|
Share-based compensation expense |
|
|
13,601 |
|
|
|
11,675 |
|
Provision (benefit) for losses on accounts receivable |
|
|
324 |
|
|
|
(900 |
) |
Loss on extinguishment of debt |
|
|
— |
|
|
|
843 |
|
Deferred income tax benefit |
|
|
(9,029 |
) |
|
|
(6,758 |
) |
Changes in operating lease right-of-use assets and lease liabilities |
|
|
3,766 |
|
|
|
(3,077 |
) |
Gain on sale and dispositions of property and equipment |
|
|
(27,876 |
) |
|
|
(18,563 |
) |
Changes in operating assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
(68,442 |
) |
|
|
90,203 |
|
Merchandise inventories |
|
|
(123,077 |
) |
|
|
165,651 |
|
Accounts payable |
|
|
203,371 |
|
|
|
52,159 |
|
Net change in other assets and liabilities |
|
|
(19,517 |
) |
|
|
82,954 |
|
Other, net |
|
|
5,891 |
|
|
|
6,994 |
|
Cash provided by operating activities |
|
|
63,187 |
|
|
|
471,510 |
|
Investing activities: |
|
|
|
|
|
|
||
Additions to property and equipment |
|
|
(90,379 |
) |
|
|
(92,750 |
) |
Additions to computer software |
|
|
(4,829 |
) |
|
|
(8,229 |
) |
Proceeds from sale of property and equipment |
|
|
67,026 |
|
|
|
35,729 |
|
Other, net |
|
|
(8,858 |
) |
|
|
(418 |
) |
Cash used for investing activities |
|
|
(37,040 |
) |
|
|
(65,668 |
) |
Financing activities: |
|
|
|
|
|
|
||
Borrowings under amended Receivables Financing Agreement |
|
|
667,300 |
|
|
|
348,200 |
|
Repayments under amended Receivables Financing Agreement |
|
|
(667,300 |
) |
|
|
(444,200 |
) |
Repayments of term loans |
|
|
(12,375 |
) |
|
|
(78,301 |
) |
Other, net |
|
|
(12,545 |
) |
|
|
(8,819 |
) |
Cash used for financing activities |
|
|
(24,920 |
) |
|
|
(183,120 |
) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
|
(682 |
) |
|
|
196 |
|
Net increase in cash, cash equivalents and restricted cash |
|
|
545 |
|
|
|
222,918 |
|
Cash, cash equivalents and restricted cash at beginning of period |
|
|
272,924 |
|
|
|
86,185 |
|
Cash, cash equivalents and restricted cash at end of period(1) |
|
$ |
273,469 |
|
|
$ |
309,103 |
|
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
||
Income taxes paid (received), net |
|
$ |
5,240 |
|
|
$ |
(10,506 |
) |
Interest paid |
|
$ |
70,819 |
|
|
$ |
78,625 |
|
Noncash investing activity: |
|
|
|
|
|
|
||
Unpaid purchases of property and equipment and computer software at end of period |
|
$ |
76,373 |
|
|
$ |
65,808 |
|
(1) Restricted cash as of June 30, 2024 and December 31, 2023 was
Owens & Minor, Inc. |
||||||||||||||
Summary Segment Information (unaudited) |
||||||||||||||
(dollars in thousands) |
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Three Months Ended June 30, |
|
|||||||||||
|
|
2024 |
|
2023 |
|
|||||||||
|
|
|
|
|
% of |
|
|
|
|
% of |
|
|||
|
|
|
|
|
consolidated |
|
|
|
|
consolidated |
|
|||
|
|
Amount |
|
net revenue |
|
Amount |
|
net revenue |
|
|||||
Net revenue: |
|
|
|
|
|
|
|
|
|
|
|
|||
Products & Healthcare Services |
|
$ |
2,010,605 |
|
|
75.28 |
% |
$ |
1,930,723 |
|
|
75.32 |
% |
|
Patient Direct |
|
|
660,401 |
|
|
24.72 |
% |
|
632,503 |
|
|
24.68 |
% |
|
Consolidated net revenue |
|
$ |
2,671,006 |
|
|
100.00 |
% |
$ |
2,563,226 |
|
|
100.00 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
% of segment |
|
|
|
|
% of segment |
|
|||
Operating income: |
|
|
|
|
net revenue |
|
|
|
|
net revenue |
|
|||
Products & Healthcare Services |
|
$ |
11,468 |
|
|
0.57 |
% |
$ |
2,940 |
|
|
0.15 |
% |
|
Patient Direct |
|
|
64,787 |
|
|
9.81 |
% |
|
59,065 |
|
|
9.34 |
% |
|
Acquisition-related charges and intangible amortization |
|
|
(19,985 |
) |
|
|
|
|
(22,203 |
) |
|
|
|
|
Exit and realignment charges, net |
|
|
(29,293 |
) |
|
|
|
|
(28,963 |
) |
|
|
|
|
Litigation and related charges (1) |
|
|
(6,678 |
) |
|
|
|
|
— |
|
|
|
|
|
Consolidated operating income |
|
$ |
20,299 |
|
|
|
|
$ |
10,839 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization: |
|
|
|
|
|
|
|
|
|
|
|
|||
Products & Healthcare Services |
|
$ |
19,084 |
|
|
|
|
$ |
18,772 |
|
|
|
|
|
Patient Direct |
|
|
44,795 |
|
|
|
|
|
53,290 |
|
|
|
|
|
Consolidated depreciation and amortization |
|
$ |
63,879 |
|
|
|
|
$ |
72,062 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Capital expenditures: |
|
|
|
|
|
|
|
|
|
|
|
|||
Products & Healthcare Services |
|
$ |
3,117 |
|
|
|
|
$ |
6,602 |
|
|
|
|
|
Patient Direct |
|
|
42,683 |
|
|
|
|
|
42,887 |
|
|
|
|
|
Consolidated capital expenditures |
|
$ |
45,800 |
|
|
|
|
$ |
49,489 |
|
|
|
|
|
(1) Litigation and related charges are reported within Other operating expense, net in our Statements of Operations. Refer to footnote 3 in the GAAP/Non-GAAP Reconciliations below.
Owens & Minor, Inc. |
||||||||||||||
Summary Segment Information (unaudited) |
||||||||||||||
(dollars in thousands) |
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Six Months Ended June 30, |
|
|||||||||||
|
|
2024 |
|
2023 |
|
|||||||||
|
|
|
|
|
% of |
|
|
|
|
% of |
|
|||
|
|
|
|
|
consolidated |
|
|
|
|
consolidated |
|
|||
|
|
Amount |
|
net revenue |
|
Amount |
|
net revenue |
|
|||||
Net revenue: |
|
|
|
|
|
|
|
|
|
|
|
|||
Products & Healthcare Services |
|
$ |
3,985,442 |
|
|
75.43 |
% |
$ |
3,846,212 |
|
|
75.62 |
% |
|
Patient Direct |
|
|
1,298,244 |
|
|
24.57 |
% |
|
1,239,863 |
|
|
24.38 |
% |
|
Consolidated net revenue |
|
$ |
5,283,686 |
|
|
100.00 |
% |
$ |
5,086,075 |
|
|
100.00 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
% of segment |
|
|
|
|
% of segment |
|
|||
Operating income: |
|
|
|
|
net revenue |
|
|
|
|
net revenue |
|
|||
Products & Healthcare Services |
|
$ |
22,954 |
|
|
0.58 |
% |
$ |
4,761 |
|
|
0.12 |
% |
|
Patient Direct |
|
|
110,666 |
|
|
8.52 |
% |
|
104,914 |
|
|
8.46 |
% |
|
Acquisition-related charges and intangible amortization |
|
|
(40,298 |
) |
|
|
|
|
(44,392 |
) |
|
|
|
|
Exit and realignment charges, net |
|
|
(56,649 |
) |
|
|
|
|
(44,637 |
) |
|
|
|
|
Litigation and related charges (1) |
|
|
(6,678 |
) |
|
|
|
|
— |
|
|
|
|
|
Consolidated operating income |
|
$ |
29,995 |
|
|
|
|
$ |
20,646 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization: |
|
|
|
|
|
|
|
|
|
|
|
|||
Products & Healthcare Services |
|
$ |
42,450 |
|
|
|
|
$ |
37,338 |
|
|
|
|
|
Patient Direct |
|
|
95,524 |
|
|
|
|
|
105,650 |
|
|
|
|
|
Consolidated depreciation and amortization |
|
$ |
137,974 |
|
|
|
|
$ |
142,988 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Capital expenditures: |
|
|
|
|
|
|
|
|
|
|
|
|||
Products & Healthcare Services |
|
$ |
11,367 |
|
|
|
|
$ |
12,934 |
|
|
|
|
|
Patient Direct |
|
|
83,841 |
|
|
|
|
|
88,045 |
|
|
|
|
|
Consolidated capital expenditures |
|
$ |
95,208 |
|
|
|
|
$ |
100,979 |
|
|
|
|
|
(1) Litigation and related charges are reported within Other operating expense, net in our Statements of Operations. Refer to footnote 3 in the GAAP/Non-GAAP Reconciliations below.
Owens & Minor, Inc. |
||||||||||||||||
Net Loss Per Common Share (unaudited) |
||||||||||||||||
(dollars in thousands, except per share data) |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Net loss |
|
$ |
(31,913 |
) |
|
$ |
(28,241 |
) |
|
$ |
(53,799 |
) |
|
$ |
(52,659 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average shares outstanding - basic |
|
|
76,727 |
|
|
|
75,801 |
|
|
|
76,526 |
|
|
|
75,559 |
|
Dilutive shares |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Weighted average shares outstanding - diluted |
|
|
76,727 |
|
|
|
75,801 |
|
|
|
76,526 |
|
|
|
75,559 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net loss per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
$ |
(0.42 |
) |
|
$ |
(0.37 |
) |
|
$ |
(0.70 |
) |
|
$ |
(0.70 |
) |
Diluted |
|
$ |
(0.42 |
) |
|
$ |
(0.37 |
) |
|
$ |
(0.70 |
) |
|
$ |
(0.70 |
) |
Share-based awards of approximately 1.6 million shares for the three and six months ended June 30, 2024 and approximately 1.8 million and 1.7 million shares for the three and six months ended June 30, 2023 were excluded from the calculation of net loss per diluted common share as the effect would be anti-dilutive.
Owens & Minor, Inc. |
||||||||||||||||||||
GAAP/Non-GAAP Reconciliations (unaudited) |
||||||||||||||||||||
(dollars in thousands, except per share data) |
||||||||||||||||||||
The following table provides a reconciliation of reported operating income, net loss and net loss per share to non-GAAP measures used by management. |
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|||||||||||||||
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
|||||||||||
Operating income, as reported (GAAP) |
|
$ |
20,299 |
|
|
$ |
10,839 |
|
|
$ |
29,995 |
|
|
$ |
20,646 |
|
|
|||
Acquisition-related charges and intangible amortization (1) |
|
|
19,985 |
|
|
|
22,203 |
|
|
|
40,298 |
|
|
|
44,392 |
|
|
|||
Exit and realignment charges, net (2) |
|
|
29,293 |
|
|
|
28,963 |
|
|
|
56,649 |
|
|
|
44,637 |
|
|
|||
Litigation and related charges (3) |
|
|
6,678 |
|
|
|
— |
|
|
|
6,678 |
|
|
|
— |
|
|
|||
Operating income, adjusted (non-GAAP) (Adjusted Operating Income) |
|
$ |
76,255 |
|
|
$ |
62,005 |
|
|
$ |
133,620 |
|
|
$ |
109,675 |
|
|
|||
Operating income as a percent of net revenue (GAAP) |
|
|
0.76 |
|
% |
|
0.42 |
|
% |
|
0.57 |
|
% |
|
0.41 |
|
% |
|||
Adjusted operating income as a percent of net revenue (non-GAAP) |
|
|
2.85 |
|
% |
|
2.42 |
|
% |
|
2.53 |
|
% |
|
2.16 |
|
% |
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Net loss, as reported (GAAP) |
|
$ |
(31,913 |
) |
|
$ |
(28,241 |
) |
|
$ |
(53,799 |
) |
|
$ |
(52,659 |
) |
|
|||
Pre-tax adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Acquisition-related charges and intangible amortization (1) |
|
|
19,985 |
|
|
|
22,203 |
|
|
|
40,298 |
|
|
|
44,392 |
|
|
|||
Exit and realignment charges, net (2) |
|
|
29,293 |
|
|
|
28,963 |
|
|
|
56,649 |
|
|
|
44,637 |
|
|
|||
Litigation and related charges (3) |
|
|
6,678 |
|
|
|
— |
|
|
|
6,678 |
|
|
|
— |
|
|
|||
Other (4) |
|
|
430 |
|
|
|
843 |
|
|
|
861 |
|
|
|
1,972 |
|
|
|||
Income tax benefit on pre-tax adjustments (5) |
|
|
(13,553 |
) |
|
|
(9,551 |
) |
|
|
(24,901 |
) |
|
|
(20,530 |
) |
|
|||
One-time income tax charge (6) |
|
|
17,233 |
|
|
|
— |
|
|
|
17,233 |
|
|
|
— |
|
|
|||
Net income, adjusted (non-GAAP) (Adjusted Net Income) |
|
$ |
28,153 |
|
|
$ |
14,217 |
|
|
$ |
43,019 |
|
|
$ |
17,812 |
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Net loss per common share, as reported (GAAP) |
|
$ |
(0.42 |
) |
|
$ |
(0.37 |
) |
|
$ |
(0.70 |
) |
|
$ |
(0.70 |
) |
|
|||
After-tax adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Acquisition-related charges and intangible amortization (1) |
|
|
0.19 |
|
|
|
0.24 |
|
|
|
0.39 |
|
|
|
0.45 |
|
|
|||
Exit and realignment charges, net (2) |
|
|
0.29 |
|
|
|
0.30 |
|
|
|
0.55 |
|
|
|
0.46 |
|
|
|||
Litigation and related charges (3) |
|
|
0.08 |
|
|
|
— |
|
|
|
0.08 |
|
|
|
— |
|
|
|||
Other (4) |
|
|
— |
|
|
|
0.01 |
|
|
|
0.01 |
|
|
|
0.02 |
|
|
|||
One-time income tax charge (6) |
|
|
0.22 |
|
|
|
— |
|
|
|
0.22 |
|
|
|
— |
|
|
|||
Net income per common share, adjusted (non-GAAP) (Adjusted EPS) |
|
$ |
0.36 |
|
|
$ |
0.18 |
|
|
$ |
0.55 |
|
|
$ |
0.23 |
|
|
|||
Owens & Minor, Inc. |
||||||||||||||||
GAAP/Non-GAAP Reconciliations (unaudited), continued |
||||||||||||||||
(dollars in thousands) |
||||||||||||||||
The following tables provide reconciliations of net loss and total debt to non-GAAP measures used by management. |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Net loss, as reported (GAAP) |
|
$ |
(31,913 |
) |
|
$ |
(28,241 |
) |
|
$ |
(53,799 |
) |
|
$ |
(52,659 |
) |
Income tax provision (benefit) |
|
|
15,108 |
|
|
|
(2,720 |
) |
|
|
9,882 |
|
|
|
(12,079 |
) |
Interest expense, net |
|
|
35,899 |
|
|
|
40,728 |
|
|
|
71,554 |
|
|
|
82,926 |
|
Acquisition-related charges and intangible amortization (1) |
|
|
19,985 |
|
|
|
22,203 |
|
|
|
40,298 |
|
|
|
44,392 |
|
Exit and realignment charges, net (2) |
|
|
29,293 |
|
|
|
28,963 |
|
|
|
56,649 |
|
|
|
44,637 |
|
Other depreciation and amortization (7) |
|
|
46,146 |
|
|
|
50,737 |
|
|
|
94,160 |
|
|
|
100,726 |
|
Litigation and related charges (3) |
|
|
6,678 |
|
|
|
— |
|
|
|
6,678 |
|
|
|
— |
|
Stock compensation (8) |
|
|
6,312 |
|
|
|
4,796 |
|
|
|
12,488 |
|
|
|
11,146 |
|
LIFO (credits) and charges (9) |
|
|
(1,124 |
) |
|
|
(4,534 |
) |
|
|
4,314 |
|
|
|
406 |
|
Other (4) |
|
|
430 |
|
|
|
843 |
|
|
|
861 |
|
|
|
1,972 |
|
Adjusted EBITDA (non-GAAP) |
|
$ |
126,814 |
|
|
$ |
112,775 |
|
|
$ |
243,085 |
|
|
$ |
221,467 |
|
|
|
|
|
|
|
||
|
June 30, |
|
December 31, |
||||
|
2024 |
|
2023 |
||||
Total debt, as reported (GAAP) |
$ |
2,082,713 |
|
|
$ |
2,097,502 |
|
Cash and cash equivalents |
|
(243,671 |
) |
|
|
(243,037 |
) |
Net debt (non-GAAP) |
$ |
1,839,042 |
|
|
$ |
1,854,465 |
|
The following items have been excluded in our non-GAAP financial measures:
(1) Acquisition-related charges and intangible amortization includes
(2) During the three and six months ended June 30, 2024 exit and realignment charges, net were
(3) Litigation and related charges includes settlement costs and related charges of legal matters within our Apria division. These costs do not occur in the ordinary course of our business, are non-recurring/infrequent and are inherently unpredictable in timing and amount.
(4) For the three and six months ended June 30, 2024 and 2023, other includes interest costs and net actuarial losses related to our frozen noncontributory, unfunded retirement plan for certain retirees in
(5) These charges have been tax effected by determining the income tax rate depending on the amount of charges incurred in different tax jurisdictions and the deductibility of those charges for income tax purposes.
(6) One-time income tax charge relates to a recent decision associated with the Notice of Proposed Adjustments received in 2020 and 2021. The matter at hand, as discussed in previously filed SEC documents, is related to past transfer pricing methodology which is no longer employed. We believe the matter will be concluded without further impact to our financial results.
(7) Other depreciation and amortization relates to property and equipment and capitalized computer software, excluding such amounts captured within exit and realignment charges, net or acquisition-related charges.
(8) Stock compensation includes share-based compensation expense related to our share-based compensation plans, excluding such amounts captured within exit and realignment charges, net or acquisition-related charges.
(9) LIFO (credits) and charges includes non-cash adjustments to merchandise inventories valued at the lower of cost or market, with the approximate cost determined by the last-in, first-out (LIFO) method for distribution inventories in the
Use of Non-GAAP Measures
This earnings release contains financial measures that are not calculated in accordance with
Management provides these non-GAAP financial measures to investors as supplemental metrics to assist readers in assessing the effects of items and events on its financial and operating results and in comparing the Company’s performance to that of its competitors. However, the non-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.
The non-GAAP financial measures disclosed by the Company should not be considered substitutes for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements set forth above should be carefully evaluated.
OMI-CORP
OMI-IR
View source version on businesswire.com: https://www.businesswire.com/news/home/20240802259992/en/
Investors
Alpha IR Group
Jackie Marcus or Nick Teves
OMI@alpha-ir.com
Jonathan Leon
Senior Vice President, Corporate Treasurer & Interim Chief Financial Officer
Investor.Relations@owens-minor.com
Media
Stacy Law
media@owens-minor.com
Source: Owens & Minor, Inc.
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