Invacare expects lower earnings

Saturday, December 31, 2005

ELYRIA, Ohio - Invacare announced in December an anticipated fourth quarter shortfall of $30 million. The drop is due to the implementation of a new $20 million enterprise resource planning system that has disrupted order processing and created inefficiencies. Net sales for the quarter will range from $370 million to $380 million, a decrease of 3% to 6% compared to the same quarter last year. Previous expectations for the quarter predicted an increase of 2% to 4%. For the full year, the company anticipates a net sales increase of 9% and 10%, compared to prior expectations of 11% to 12%. Free cash flow for the year is expected to range from $35 million to $45 million, compared to a prior free cash flow guidance of $55 million to $65 million. Mal Mixon, chairman and CEO, said Invacare was disappointed by the results but said the company's outlook for 2006 has not changed. ERP implementation issues include an inability to ship products on time. The company expects to resolve ERP issues by Dec. 31, 2005.