CANTEL MEDICAL CORP. reported net income of $10,249,000or $0.25 per diluted share, on a 14% increase in sales to a record $120,058,000 for the third quarter ended April 30, 2014. These results are inclusive of $0.01 of acquisition related charges, including contingent consideration fair value adjustments and professional fees associated with our acquisition program. This compares with net income of $8,998,000 or $0.22 per diluted share, on sales of $105,009,000 for the third quarter ended April 30, 2013.
For the nine months ended April 30, 2014, the Company reported record net income of $32,560,000 or $0.79 per diluted share, on a 15% increase in sales to a record$357,372,000, inclusive of $0.01 of acquisition related expenses. This compares with net income of $29,026,000 or $0.71 per diluted share, on sales of $311,053,000, for the nine months ended April 30, 2013 inclusive of $0.01 in net favorable acquisition related fair value contingent consideration adjustments partially offset by severance and recruiting costs.
Andrew Krakauer, Cantel’s President and CEO stated, “We are pleased to have delivered record sales and solid earnings performance in the third quarter. All three of our major segments had good sales and profit growth. These positive results confirm the continued success of our strategic approach to growth which includes investing in new product development, sales and marketing programs and acquisitions. Most importantly, for the fourth consecutive quarter we had strong organic sales growth of 10% or greater.”
Krakauer added, “Sales growth performance was led this quarter by our Medivators Endoscopy segment which had excellent year-over-year organic growth of 19%. This unit achieved record sales for the third consecutive quarter with double digit growth in all product categories. Our Mar Cor Water Purification and Filtration unit achieved sales growth of 16%, of which 10% was organic. Sales in this segment were led by increased shipments of central and portable water purification equipment. In our Crosstex Healthcare Disposables segment, the increase in organic sales exceeded 12%.
Our strong revenue increases have generated improved earnings, even as we are increasing investments in sales and marketing and new product development. Further, we are continuing our aggressive approach in building our international sales, marketing, and operations teams to grow this part of our business in the medium-term. Overall, we expect to continue to accelerate these investments over the next several quarters, while remaining committed to an active global acquisition program.
With regard to acquisitions, we were very pleased to have announced yesterday that Cantel had reached a definitive agreement to purchase PuriCore International Ltd., a wholly owned subsidiary of PuriCore plc. PuriCore International Ltd. is a leading provider of automated endoscope reprocessors, endoscope drying and storage cabinets, and related chemistry and consumables in the United Kingdom. This acquisition is expected to close on or about June 30, 2014 and will add a major $25 million international business into Cantel’s Medivators Endoscopy segment. This acquisition is an important step in our strategic plan to expand the Company’s international business and will be slightly accretive in FY 2015.”
The Company further reported that its balance sheet at April 30, 2014 included current assets of $152,031,000, including cash of $24,474,000, a current ratio of 3:1, gross debt of $64,500,000 and stockholders’ equity of $354,435,000. Krakauer stated, “The Company has a strong balance sheet and continues to generate significant cash flow and EBITDAS. When compared with the same quarter last year, our EBITDAS grew by 18% to $22,996,000. EBITDAS for the first nine months of fiscal year 2014 of $71,581,000 is 14% ahead of the same period in the prior year. We reduced our net debt in the past 3 months by almost $15 million to $40,026,000.”
Cantel Medical is a leading global company dedicated to delivering innovative infection prevention and control products and services for patients, caregivers, and other healthcare providers which improve outcomes, enhance safety and help save lives. Our products include specialized medical device reprocessing systems for endoscopy and renal dialysis, advanced water purification equipment, sterilants, disinfectants and cleaners, sterility assurance monitoring products for hospitals and dental clinics, disposable infection control products primarily for dental and GI endoscopy markets, dialysate concentrates, hollow fiber membrane filtration and separation products, and specialty packaging for infectious and biological specimens. Additionally, we provide technical service for our products.
SOURCE Cantel Medical Corp.