Earnings: Invacare, analysts butt heads; Lincare enjoys increase

Sunday, April 27, 2008

ELYRIA, Ohio - Sometimes you can't win for winning. Invacare released its first quarter results last week, and CEO Mal Mixon called the company's "significant improvement in adjusted earnings" gratifying ($3.6 million vs. $1.6 million last year). Some analysts, however, disagreed, describing the first quarter performance as disappointing. As a result, the company's stock tumbled to a new 52-week low ($16.13 a share), prompting Invacare to issue a response to the analysts. The company noted that "because it does not provide quarterly earnings guidance, the investor community may project quarterly earnings that vary from management's expectations." In its first quarter results, Invacare reported that: North American HME sales increased 8.7%, driven primarily by sales in rehab, standard and respiratory product lines; cost reductions saved the company $3.7 million in the first quarter; DSO increased one day to 63 days; overall, net sales increased 11% to $416 million.

Lincare boosts revenues 10%
CLEARWATER, Fla. - Lincare last week reported $415.4 million in revenues for the first quarter ended March 31, 2008, compared to $378.5 million in revenues for the same period last year. The provider credits the increase to 11% internal growth. Lincare reported $60.7 million in net income for the first quarter of 2008 compared to $53.9 million for the same period last year. The provider added 10 new operating centers derived from internal development in the first quarter, bringing its total number of locations to 1,029. "We are pleased with Lincare's operating and financial performance in the first quarter of 2009. We continue to gain market share in our core respiratory business while controlling costs and reinvesting capital to sustain growth," stated CEO John Byrnes. Additionally, Lincare revised its previous guidance on the expected impact of Medicare price reductions in 2008 for certain respiratory drugs. The provider now believes the reductions to impact revenues by $100 million instead of $65 million to $70 million.