Greatbatch Inc.’s second-quarter profits easily topped analyst forecasts as sales of its medical devices and batteries jumped by 18 percent.
Greatbatch’s profits more than doubled to $14.9 million, or 58 cents per share, from $5.7 million, or 23 cents per share, a year earlier.
The company’s adjusted operating profits, which exclude expenses for items such as plant consolidation and new-product testing, grew by 16 percent to $22.3 million, or 54 cents per share, from $19.3 million, or 44 cents per share, easily topping the 50 cents per share that analysts were expecting.
Coming off a strong first quarter, Greatbatch executives said expect the company’s sales and earnings for the full year to come in at the higher end of its forecasted range, with sales rising to between $685 and $705 million, while adjusted earnings per share rise to between $2.25 and $2.35 per share.
Greatbatch executives said the improvement stemmed from 23 percent increases in sales at three of its main businesses, which sell portable medical devices, orthopedic products and equipment for the cardiac and neurostimulation markets. That pushed Greatbatch’s overall revenues up by 18 percent to $174.3 million from $148.3 million a year ago.
Sales for the company’s cardiac rhythm management products, which include batteries and other components used in pacemakers and implantable cardiac defibrillators, jumped by 23 percent to $86.8 million from $70.5 million a year ago.
Thomas J. Hook, Greatbatch’s chief executive officer, said the increase stemmed from new products launched by Greatbatch’s customers that include the company’s technology. Some of Greatbatch’s customers also may have increased inventories, Hook said during a conference call.
Revenues from Greatbatch’s orthopedic products business also jumped by 23 percent to $36.4 million, compared with a weak first quarter last year, when the company was in the midst of closing its factories in Switzerland and shifting those operations to plants in Tijuana, Mexico, and Fort Wayne, Ind.
Sales of portable medical devices inched up by 2 percent to $19.2 million as the company stopped selling or reduced the volumes of some of its less profitable products – a shift that is expected to weigh on the unit’s revenues throughout this year. “We are refocusing our product line offerings in the portable medical space to products that have increased profitability,” Hook said on a conference call.
Vascular product sales rose by 23 percent to $13.1 million, partly because the company relaunched one of the vascular medical devices that it had voluntarily recalled near the end of 2012.
Battery sales to its energy, military and environmental market grew by 1 percent to $18.1 million, mainly because of an 8 percent increase in revenues from customers in the energy industry, which offset lower military and environmental sales.
Greatbatch shares were up 39 cents, to $46.42 in early trading Thursday.