Steris Q3 Results Miss View; Cuts FY Outlook

(RTTNews) - Steris plc (STE) reported that net loss for the third quarter of fiscal 2017 was 5.0 million or $0.06 per share, compared with net income of $20.0 million or $0.26 per diluted in the third quarter of fiscal 2016. The net loss included a charge of $58.4 million for goodwill impairment relative to the linen management business within the Healthcare Specialty Services segment resulting from annual goodwill impairment assessment.

Adjusted net income for the third quarter of fiscal 2017 was $84.0 million, or $0.98 per share, compared with adjusted net income for the previous year's third quarter of $76.2 million or $0.98 per share. Analysts polled by Thomson Reuters expected the company to report earnings of $1.04 per share. Analysts' estimates typically exclude special items.

Fiscal 2017 third quarter revenue increased 5% to $646.8 million compared with $618.7 million in the third quarter of fiscal 2016. Constant currency organic revenue, which excludes acquisitions and divestitures, growth was 3% for the third quarter of fiscal 2017. Third quarter results for fiscal 2016 included two months of Synergy results. Wall Street analysts had a consensus revenue estimate of $678.54 million.

STERIS's Board of Directors has authorized a quarterly interim dividend of $0.28 per share. The dividend is payable March 28, 2017 to shareholders of record at the close of business on February 28, 2017.

The Company revised its revenue outlook to approximately 4% constant currency organic revenue growth for fiscal 2017, and total as reported revenue growth expectations to approximately 17% for fiscal 2017. Reflecting the lower than anticipated third quarter performance and an increase in the effective tax rate for the year, the Company also revised its outlook for adjusted earnings per share to now be in the range of $3.70 - $3.76 for fiscal 2017.Analysts expect annual earnings of $3.89 per share.

Previously, the company expected approximately 6% constant currency organic revenue growth for fiscal 2017. It projected reported Total revenue growth of approximately 19-20% for fiscal 2017. The company expected adjusted earnings per share in the range of $3.85 - $4.00 for fiscal 2017.