Monday, June 1, 2020

Envista Reports First Quarter 2020 Results

 


Envista is one of the largest companies in dentistry.  It encompasses 3 companies and more than 30 dental bands. Envista's companies, including KaVo Kerr, Nobel Biocare Systems, and Ormco, partner with dental professionals to help them deliver the best possible patient care.  Because of their wide reach in the dental industry, how things go with Envista can be a strong indicator of how things are overall.  When the industry is booming, the Envista numbers show it.  Conversely, when the business side of dentistry takes a downturn, Envista reflects that as well.

We all know that the Covid-19 pandemic has had a tremendous negative impact on the economy and especially on dentistry.  Well, Envista has published their first quarter financial results and you can certainly see the impact that the shutdown has had on the dental sector...

Envista Holdings Corporation (NYSE: NVST) today announced results for the first quarter 2020.

For the first quarter ended April 3, 2020, net loss was $17.2 million, or $0.11 per share. For the same period, adjusted net income was $5.0 million, or $0.03 per diluted share.
Sales for the first quarter were $547.2 million, a 17.1% decrease as compared to the same period year-over-year. Core sales declined 14.6% over the same period. We estimate that the COVID-19 global health pandemic adversely impacted sales in the quarter by approximately 16.0% with impacts to all major regions.

Amir Aghdaei, Chief Executive Officer, stated, "Revenue exceeded our expectations in the first two months of the year, but the ongoing global health pandemic had a significant adverse impact on the business in the last three weeks of March. We have taken immediate steps to ensure the safety of our employees, support our customers and partners, and preserve our financial strength. These actions will help protect our growth investments in clear aligners, implants and emerging markets, structurally improve margin, and accelerate our portfolio transformation."

Mr. Aghdaei continued, "The ability to achieve our strategic objectives and create value is directly dependent on the strength of our employees, relationships with our customers and partners, the Envista leadership team, and our EBS foundation. Our team is fully committed to navigate through these challenging times while building a stronger Envista."

Contributions Towards COVID-19 Relief Efforts
Envista's employees have donated thousands of masks and other personal protective equipment in their local communities worldwide. The Company was one of the first companies to donate infection prevention products to the Wuhan government and its Orascoptic business donated eye protection to hundreds of healthcare professionals in the U.S. Metrex, Envista's infection prevention business, has taken actions to increase shipments of medical grade disinfection products used by health care professionals globally.

Financial Actions
In March 2020, the Company borrowed $250 million on its revolving credit facility to provide additional liquidity to manage through the COVID-19 pandemic. Subsequent to the quarter end, the Company entered into an amendment with its existing lenders that provides, among other things, for the suspension of its debt leverage covenant through Q1 2021.

The Company has implemented temporary cost reduction measures of more than $100 million including pay decreases, furloughs and aggressive management of non-essential spending. The Company is also moving forward with plans to improve its financial position through a structural cost reduction program targeted to reduce its overall expenses by more than $100 million on an annualized basis. These actions are expected to be substantially completed by the end of 2020.

Guidance
As disclosed in a Form 8-K filed April 2, 2020, Envista has withdrawn its guidance for 2020 due to the uncertainties surrounding the current operating environment and the unknown duration of the COVID-19 global health pandemic. The Company is not providing further guidance at this time.

Envista will discuss its results during a quarterly investor conference call today starting at 2:00 P.M. PDT. The call and an accompanying slide presentation will be webcast on the "Investors" section of Envista's website, www.envistaco.com, under the subheading "Events & Presentations." A replay of the webcast will be available in the same section of Envista's website shortly after the conclusion of the presentation and will remain available until the next quarterly earnings call.

The conference call can be accessed by dialing 866-648-5306 within the U.S. or by dialing +1 602-563-8479 outside the U.S. a few minutes before the 2:00 P.M. PT start and referencing conference ID # 2488658. A replay of the conference call will be available shortly after the conclusion of the call until June 12, 2020. You can access the replay dial-in information on the "Investors" section of Envista's website under the subheading "Events & Presentations." In addition, presentation materials relating to Envista's results have been posted to the "Investors" section of Envista's website under the subheading "Quarterly Earnings."

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