Henry Schein (NASDAQ: HSIC), a global leader in healthcare products and services, released its third-quarter 2024 financial results, showing a mixed performance as the company continues its strategic transformation while recovering from previous operational challenges.
The company reported total net sales of $3.2 billion for Q3 2024, representing a modest 0.4% increase compared to the same period last year. However, GAAP diluted EPS decreased to $0.78 from $1.05 in Q3 2023, while non-GAAP diluted EPS reached $1.22, down from $1.32 in the previous year.
A notable bright spot was the company’s cash flow performance:
* Operating cash flow reached $151 million in Q3 2024
* Year-to-date operating cash flow increased to $644 million
* This represents a $112 million improvement from the same period in 2023
Global Dental
- Revenue decreased by 1.6% year-over-year
- Dental Merchandise sales declined 2.8%
- Dental Equipment showed positive growth of 2.8%
- Market share recovery continues following the 2023 cyber incident
Global Medical
- Revenue grew 2.9% compared to Q3 2023
- Internal sales decreased by 4.8%
- Acquisition growth contributed 7.6%
Technology and Value-Added Services
- Revenue increased by 5.1%
- Internal sales declined 1.1%
- Acquisition growth added 6.0%
The implementation of the BOLD+1 Strategic Plan has shown promising results:
* Focus on high-growth, high-margin products and services
* Market share gains in dental and medical distribution
* Strong performance in implant and endodontic products across key markets
* Successful integration of recent acquisitions
The company’s restructuring initiatives are advancing as planned:
* Q3 2024 restructuring costs totaled $48 million
* Annual run-rate savings target of $75-100 million by end of 2025
* Strategic focus on operational efficiency and cost management
Henry Schein has updated its guidance for 2024:
* Total sales growth projected at 4-5%
* Non-GAAP diluted EPS guidance increased to $4.74-4.82
* Adjusted EBITDA expected to grow in low-double-digit percentages
The company sees several positive market indicators:
* Stable dental equipment business in North America
* Increased customer investment in Europe, Australia, and New Zealand
* Strong growth in implant and endodontic products
* Potential benefits from expected lower interest rates in 2025
Several challenges require monitoring:
* 27.8% decrease in GAAP net income compared to Q3 2023
* Internal sales decline of 2.6%
* Ongoing recovery from the 2023 cyber incident
* Lower sales of personal protective equipment
The AI-powered analysis from EarningsCall SamurAI indicates that while Henry Schein faces near-term challenges, the company’s strategic initiatives and market position support a positive long-term outlook. The increased guidance and strong cash flow generation suggest management’s confidence in the company’s recovery trajectory.
To gain deeper insights into Henry Schein’s performance and access the complete AI-powered analysis, visit the detailed report on EarningsCall SamurAI.
