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Stryker reports first quarter 2024 operating results

Stryker reported operating results for the first quarter of 2024:

First quarter results

  • Reported net sales increased 9.7% to $5.2 billion
  • Organic net sales increased 10.0%
  • Reported operating income margin of 18.5%
  • Adjusted operating income margin increased 80 bps to 21.9%
  • Reported EPS increased 33.1% to $2.05
  • Adjusted EPS increased 16.8% to $2.50

“Our momentum from 2023 continued into the first quarter as we delivered 10% organic sales growth,” said Kevin A. Lobo, Chair and CEO. “Our teams are executing well and I am confident in our ability to grow sales at the high end of MedTech and drive strong adjusted earnings growth in 2024.”

Sales analysis
Consolidated net sales of $5.2 billion increased 9.7% in the quarter and 10.2% in constant currency. Organic net sales increased 10.0% in the quarter including 9.3% from increased unit volume and 0.7% from higher prices.

MedSurg and Neurotechnology net sales of $3.0 billion increased 11.5% in the quarter and 12.0% in constant currency. Organic net sales increased 11.6% in the quarter including 10.2% from increased unit volume and 1.4% from higher prices.

Orthopaedics and Spine net sales of $2.2 billion increased 7.5% in the quarter and 8.0% in constant currency. Organic net sales increased 8.0% in the quarter including 8.2% from increased unit volume partially offset by 0.2% from lower prices.

Earnings analysis
Reported net earnings of $788 million increased 33.1% in the quarter. Reported net earnings per diluted share of $2.05 increased 33.1% in the quarter. Reported gross profit margin and reported operating income margin were 63.6% and 18.5% in the quarter. Reported net earnings include certain items, such as charges for acquisition and integration-related activities, the amortization of purchased intangible assets, structural optimization and other special charges (including asset write-offs and impairments), costs to comply with certain medical device regulations, recall-related matters, regulatory and legal matters and tax matters. Excluding the aforementioned items, adjusted gross profit margin was 63.6% in the quarter, and adjusted operating income margin was 21.9% in the quarter. Adjusted net earnings of $962 million increased 17.3% in the quarter. Adjusted net earnings per diluted share of $2.50 increased 16.8% in the quarter.

2024 outlook
Considering our first quarter results, strong procedural volumes and healthy demand for our capital products, we now expect full year 2024 organic net sales growth to be in the range of 8.5% to 9.5% with the pricing impact to be roughly flat. If foreign exchange rates hold near current levels, we anticipate net sales will be moderately unfavorably impacted for the full year, being more negative in the first half of the year, and adjusted net earnings per diluted share will be negatively impacted at the higher end of our previously guided range of $0.05 to $0.10 for the full year. With our momentum heading into the rest of the year and our commitment to expanding operating margins, we now expect adjusted net earnings per diluted share to be in the range of $11.85 to $12.05.
MB Bureau

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