Greatbatch sees its sales rise 14 percent
Earnings defeat analysts’ projections
Greatbatch Inc.’s efforts to broaden its medical products business, while also streamlining its operations, helped the Clarencebased company’s first-quarter profits beat analyst expectations as sales grew by 14 percent.
“We definitely think we’re on the right track,” said Thomas J. Hook, Greatbatch’s president and chief executive officer, during a conference call.
Greatbatch earned $6.7 million, or 28 cents per share, during the first quarter, compared with a loss of $4.4 million, or 20 cents per share, a year ago.
Excluding one-time charges related to acquisitions, plant consolidations and research project write-downs, Greatbatch earned 41 cents per share, which was better than the 36 cents per share that analysts were expecting.
Sales rose to $140 million from $122 million, as all of Greatbatch’s medical product lines generated double-digit revenue growth, averaging 19 percent. overall. That offset a 10 percent drop in sales at its commercial battery business, which was stung by the weakening economy and the plunge in oil and natural gas prices that led to a delay in many energy- related projects.
Greatbatch said it is sticking with its earlier forecast that sales will range between $550 million and $600 million this year, in line with the $569 million in sales analysts now are expecting.
Hook said Greatbatch continues to look for ways to reduce costs by consolidating its manufacturing and back-office operations. “We’re trying to run with the hatches battened down, but run hard,” he said.
The company is consolidating its research and development operations in Clarence, and Greatbatch also completed the consolidation of factories and offices in Pennsylvania, Massachusetts and Minnesota during March and April, while moving ahead with plans to shift its commercial battery operations in Teterboro, N. J., to its new plant in Raynham, Mass.
In all, Greatbatch plans to consolidate what had been five commercial battery plants into the Raynham plant by the end of the year. “It’s all about repositioning in the down market,” Hook said.
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