‘Lots of work to do,’ at Invacare
ELYRIA, Ohio – Invacare efforts to restore profitability through restructuring and debt management are ongoing, but the company ended the third quarter of 2014 with a loss.
The consolidated adjusted loss per share was $.56 for the quarter, which also included a $.27 incremental warranty expense and $.06 for an executive retirement. By comparison, the company had a $.23 loss in the third quarter of 2013.
“Without those two changes, the adjusted net loss per share would have been flat with prior year, said Invacare interim president, CEO and CFO Robert Gudbranson. “However, I want to emphasize that we recognize that we have more work to do to improve the business.”
Net sales for the quarter decreased 4.8% to $320.5 million compared to the same period last year. Gudbranson said organic net sales, which the company defines as the difference between reported net sales and foreign currency translation, declined by 6%, compared to the same time period in 2013.
The company reported $14.3 in positive free cash flow during this quarter, compared to a negative $17.3 million free cash flow in the first six months of 2014.
Gudbranson said the company took its first step to improve profitability in the North America/HME and Asia/Pacific businesses through an August restructuring that is expected to save between $14 and $15 million next year. About 150 associates and 40 temporary associates were affected by the restructuring.
Also during the third quarter, the company sold Altimate Medical, using the $21.9 million in net proceeds to reduce its total outstanding debt to $26.9 million, Gudbranson said.
Organic net sales for the North American/HME segment decreased by 14.8% compared to the third quarter last year, said Lara Mahoney, director of investor relations and corporate communications. She attributed the lower sales to declines in all product categories.
“I think focusing on the single-user products, focusing on the new manager we have and we feel good about—those we feel good about,” Gudbranson said. “Clearly, we’ve got to get North America/HME turned around, so we have a lot of work to do there.”