Yahoo Finance Zimmer Biomet Tumbles as Covid Weighs on Sales of Devices
By Dhirendra Tripathi
Investing.com – Zimmer Biomet stock (NYSE:ZBH) plunged 7.5% Monday after the company fell short of fourth-quarter estimates for both revenue and earnings.
The pandemic continues to weigh on the company, a phenomenon seen at many healthcare and medical devices companies as several patients continue to defer their health procedures.
"As we expected, the ongoing COVID pandemic continued to pressure our business in Q4. The quarter was particularly impacted throughout December due to hospital staffing shortages and the Omicron variant surge worldwide," Chairman, President and CEO Bryan Hanson said in a company statement.
The company also blamed China’s volume-based procurement in knees, hips and spinal segments for the shortfall in both revenue and earnings.
Fourth-quarter net sales fell 2.3% to $2 billion, mainly because of slippages in the Americas and Asia Pacific as the regions came under the onslaught of the pandemic again, this time due to Omicron. Product-wise, revenue in both knee and hips fell.
Zimmer is spinning off its dental and spine businesses into a separately listed entity, ZimVie. The transaction is expected to close on March 1.
For the current year, the company is projecting revenue to erode by a maximum 4% or stay flat at 2021 sales of $6.8 billion after accounting for the separation of the dental and spine business. Adjusted profit per share is seen at $6.60 at the midpoint of the company’s guidance range.
Fourth-quarter adjusted profit per share fell 16 cents to $1.95.
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