It has been about a month since the last earnings report for Hill-Rom (HRC). Shares have lost about 0.3% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Hill-Rom due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Hill-Rom Beats on Q3 Earnings
Hill-Rom Holdingsdelivered third-quarter fiscal 2019 adjusted earnings per share (EPS) of $1.23 excluding certain special items. This figure improved 6.9% from the year-ago quarter and also surpassed the Zacks Consensus Estimate of $1.21 by 1.7%.
Moreover, revenues in the quarter came in at $726.8 million, reflecting a 2.6% increase from the year-ago period. The top line also beat the Zacks Consensus Estimate of $719 million by 1.1%.
Geographically, U.S. revenues grew 7.2% in the reported quarter while the metric outside the United States declined 8.1% (down 4.2% at constant exchange rate or CER). Core revenue growth (after excluding foreign currency, divestitures and non-strategic assets the company may exit including the Surgical Solutions international OEM business) was 6%, exceeding the company’s guidance of 4-5% growth.
Segment Details
In the quarter under review, Patient Support Systems revenues rose 6% year over year (up 7% at CER) to $375 million. This segment’s domestic revenues were up 8.3%, representing solid performance across the company’s diverse and differentiated portfolio of connected solutions and services, which include smart beds, clinical workflow solutions and mobile communications platform, Voalte.
Outside the United States, core Patient Support Systems revenues declined 8.1% (down 4.2% at CER).
Revenues at the Front Line Care segment inched up 2.3% to $244.4 million (up 3.3% at CER), banking on revenue contribution from new products resulting in double-digit growth in vision and respiratory care. Further, robust growth of certain physical assessment and diagnostic tools aided the top line within this segment. Domestic revenues grew 5.3% while there was a 5% decrease in international revenues (down 1.4% at CER).
The Surgical Solutions segment revenues slipped 1.8% (up 0.2% at CER) to $107.9 million. While domestic revenues grew 8.3%, there was a 12.2% fall in international revenues (down 8.1% at CER).
Cash Position
The company exited the third quarter of fiscal 2019 with a cash and cash equivalent of $202.6 million compared with $187 million at the end of the sequential quarter. Year to date, net cash provided by operating activities was $301.1 million compared with $249.8 million at the end of the year-ago period.