Dentsply Reports In-Line

Dentsply International Inc. (XRAY: 33.01 0.00 0.00%) reported fourth quarter and full fiscal 2009 results. For the quarter, earnings per share were 48 cents, in line with the Zacks Consensus Estimate but higher than the year-ago figure of 45 cents. For fiscal 2009, earnings per share of $1.84 were also in line with the Zacks Consensus Estimate but lower than the year-ago earnings of $1.88.
 
Earnings Estimate Revision Trend and Zacks Rank
 
The earnings estimate revision for Dentsply has portrayed a mixed trend in the past 30 days. During the period, one out of five analysts has upgraded his estimate while none has downgraded his earnings estimate for the first quarter of fiscal 2010. For fiscal 2010, one out of seven analysts has downgraded his earnings estimate while none has upgraded his estimate.
 
Dentsply has a Zacks short-term recommendation (1-3 months) of “Underperform”, a Zacks Rank #4 for the stock. However, the company’s strong business fundamentals along with its leadership position guarantee a Zacks long-term recommendation (6+ months) of “Neutral”, a Zacks Rank #3 for the stock.
 
Dentsply has reported a negative earnings surprise in one out of the preceding four quarters, with the four-quarter average being -2.17%. In all the preceding three quarters, Dentsply reported earnings per share that were in line with the Zacks Consensus Estimate.  
 
Quarterly Results
 
Total revenues in the quarter increased 11.9% year over year to $568.7 million. Excluding precious metal content, net sales increased 11.3% year over year. Growth was fueled by acquisitions, internal growth and a favorable foreign currency (FX) translation.
 
Excluding precious metal content, gross margin declined 330 basis points (bps) year over year to 54.7%. Excluding precious metal content, operating margin increased 160 bps year over year to 19.9%.
 
Fiscal Year Results
 
Total revenues in fiscal 2009 declined 1.5% year over year to $2,159.9 million. Excluding precious metal content, net sales were roughly flat year over year. Excluding precious metal content and FX, net sales increased 2.3% year over year.
 
Dentsply had a strong cash balance at the end of fiscal 2009. Total cash, cash equivalents and short-term investments totaled roughly $450.4 million, an increase of 121% year over year. Dentsply ended fiscal 2009 with an outstanding long-term debt of approximately $387.2 million.
 
Outlook
 
Dentsply expects earnings per share in fiscal 2010 to range between $1.90 and $2.00.
 
Dentsply is the leading manufacturer and distributor of a wide range of products for the dental market.