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Dentsply Sirona Inc (XRAY) Q3 2024 Earnings Call Highlights: Navigating Growth Amidst Challenges

In This Article:

  • Revenue: $951 million, representing a 0.5% increase on a reported basis and 1.3% on an organic basis compared to the prior year quarter.

  • Organic Sales Growth: 1.3%, driven by timing of EDS sales with distributors.

  • Adjusted EPS: $0.5, up 3% versus the prior year quarter.

  • Operating Cash Flow: $141 million, up 5% compared to the prior year quarter.

  • Share Repurchases: $100 million completed in Q3, with a year-to-date total of $345 million returned to shareholders.

  • Leverage Ratio: Increased slightly to 2.8 times.

  • Organic Sales Decline (Excluding Timing Impacts): 0.8%.

  • Gross Margin: Declined 40 basis points versus prior year due to unfavorable product mix and lower volume.

  • Segment Performance - Essential Dental Solutions: Organic sales increased 7.5%.

  • Segment Performance - Orthodontic and Implant Solutions: Organic sales declined 3.9%.

  • Segment Performance - Connected Technology Solutions: Organic sales declined 1.4% versus the prior year quarter.

  • Regional Performance - US: Organic sales increased 5.1%.

  • Regional Performance - Europe: Organic sales declined 2%.

  • Regional Performance - Rest of World: Organic sales grew 0.6%.

  • Full Year 2024 Outlook - Organic Sales: Expected to be down 2.5% to 3.5%.

  • Full Year 2024 Outlook - Net Sales: Expected to be in the range of $3.79 billion to $3.82 billion.

  • Full Year 2024 Outlook - Adjusted EBITDA Margin: Approximately 17.5%.

  • Full Year 2024 Outlook - Adjusted EPS: Expected to be in the range of $1.82 to $1.86.

Release Date: November 07, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Dentsply Sirona Inc (NASDAQ:XRAY) reported $951 million in revenue for Q3 2024, with organic sales up 1.3%, driven by timing of EDS sales.

  • The launch of Primescan 2 in September contributed to growth in the CAD/CAM segment, marking a milestone in digital dentistry.

  • The company successfully launched Exmark Pro Plus in the US, exceeding full-year projections by the end of Q3.

  • Dentsply Sirona Inc (NASDAQ:XRAY) has executed over 70% of its phase two transformation activities, aiming for full run-rate savings by the end of 2025.

  • The company has made significant progress in its ERP rollout, with successful deployments in the UK and the US, enhancing operational efficiency.

Negative Points

  • Dentsply Sirona Inc (NASDAQ:XRAY) announced a voluntary suspension of sales, marketing, and shipments of byte aligners and impression kits due to regulatory reviews, impacting revenue.

  • The company recorded a $500 million non-cash after-tax charge related to goodwill in the orthodontic and implant solution segment due to macroeconomic pressures.

  • Organic sales in the orthodontic and implant solution segment declined by 3.9%, with a notable decline in the US and Europe.

  • The company revised its full-year 2024 outlook, expecting organic sales to be down 2.5% to 3.5%, citing market pressures and challenges with byte.

  • Dentsply Sirona Inc (NASDAQ:XRAY) is facing ongoing macroeconomic challenges, including high interest rates and reduced patient traffic in key markets like Japan and China.