Hanger Orthopedic Group CEO Discusses Q3 2010 Results – Earnings Call Transcript
Thank you, Tom. In addition to Tom Hofmeister, I’m also joined this morning with George McHenry, our EVP and Chief Financial Officer. If we step back from the quarter on an overall basis I think there’s several noteworthy points. We grew our consolidated sales by 7.5% over the Q3 of last year. This sales performance combined with cost management yielded $0.37 earnings per share, excluding the costs associated with our relocation of our corporate office here to Austin and the costs associated with the diligence efforts surrounding Accelerated Care Plus. Now this earnings per share equates to a 23.3% growth over last year’s Q3, and this makes the 19th consecutive quarter where we have met or exceeded first call estimates.
In addition, I just want to note that we’ve completed our corporate office relocation to Austin on time and within budget, and we recently announced the signing of a definitive agreement to purchase Accelerated Care Plus. It certainly has been a busy quarter. Now let me turn this over to George who will review our financial results and balance sheet changes in detail.
George McHenryThank you, Tom. Good morning, everyone, and thank you for joining us. Q3 was really an outstanding quarter for the company. The important takeaways are as follows. Our adjusted EPS as Tom mentioned of $0.37 represented 23.3% growth over the prior year, exceeding street estimates. Our track record of consistent performance now dates back almost five years. We increased operating leverage excluding relocation expense by 60 basis points through a combination of healthy sales growth and control of spending.We experienced accelerated growth through all lines of our business. Our sales growth accelerated overall to 7.5% from 6.4% in Q2 and 5.4% in Q1. Com sales and the patient care segment accelerated to a 4.1% increase, which was an improvement over 4% in Q2 and 3.6% in Q1, and our distribution segment reported a healthy 10.5% increase compared to 10.4% in Q2. So they’re doing very well. Our com rate of 30.7% is comparable to the prior year but slightly higher than the rate we expect for the full year.
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