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Patterson Cos. misses quarterly expectations again

November 21, 2017 GMT

Patterson Cos. missed analysts’ expectations again for its second quarter.

The company earned $40.2 million, or 43 cents per share, for the quarter ended Oct. 31 compared with $45.8 million, or 48 cents per share, in the same period a year ago. The company’s adjusted earnings per share, excluding some non-recurring items and deal amortization costs, was 51 cents; analysts were expecting a gain of 54 cents.

The Mendota Heights-based distributor of animal health and dental supply products reported revenue of $1.39 billion, a 2.3 percent drop from the same quarter a year ago and 2.6 percent less than the consensus estimates of 14 analysts polled by Thomson Reuters.

This is the fourth quarter in a row in which overall sales have decreased at Patterson and the fifth time in the last six quarters that earnings have dropped.

The company’s animal health segment, which accounts for 60 percent of overall revenue, managed a small 1.4 percent revenue gain in the quarter, but revenue from the dental segment dropped 8.4 percent compared with last year’s second quarter.

On Nov. 20, after the second quarter had closed, the company named Mark Walchirk as its new president and CEO, and he’ll be charged with turning around the declining trend.

Boosting earnings will be a challenge. The company announced that it has lowered its earnings guidance for the remainder of fiscal 2018. The company now expects GAAP earnings in the $1.67 to $1.77 per share range, and non-GAAP adjusted earnings of $2 to $2.10 per share. In the company’s last fiscal year ended April 29, the company reported earnings of $1.79 per share, and adjusted earnings of $2.13 per share.

Shares of Patterson were trading Tuesday at $33.88 per share, down 2.7 percent.

Patrick Kennedy • 612-673-7926