Sales of Mentor's (MNT) silicone MemoryGel implants provided a lift to the company's fiscal first-quarter results and shares Tuesday.
Excluding the results of discontinued operations of the company's urology business, Mentor reported earning 48 cents a diluted share in the first quarter of fiscal 2008, compared to 33 cents a share in the prior-year quarter -- a 45% increase.
Analysts polled by Thomson Financial had expected 34 cents a share on revenue of $88.4 million.
Net sales rose 20% to $95.6 million compared to $79.4 million in the year-ago quarter. Mentor said the boost in net sales was primarily due to strong sales of its MemoryGel breast implants in the U.S. augmentation market, which Mentor said is transitioning from saline-filled breast implants to silicone breast implants.After the close of the quarter, the company announced it was purchasing all of the outstanding shares of Perouse Plastie SAS, a French breast implant company, for about $56.5 million. "From a strategic standpoint, the acquisition of Perouse Plastie at the end of the quarter expands the company's international product offerings and positions Mentor for future growth and expansion in key international markets," said CEO Joshua Levine. Looking ahead, with that acquisition accounted for, the company expects fiscal 2008 sales to range from $370 million to $385 million for the year and operating income to be about 20% of sales. It expects to earn $1.40 to $1.45 a diluted share from continuing operations. In reaction to the strong quarterly results, Piper Jaffray upgraded Mentor's stock rating from underperform to market perform with a $45 price target. Mentor gained $5.76, or 14.5%, to $46.75 in recent trading Tuesday.