C. R. Bard Inc. Earnings: Increased Costs Strains Margins as Profit Drops

S&P 500 (NYSE:SPY) component C. R. Bard Inc. (NYSE:BCR) reported its results for the fourth quarter. C.R. Bard designs, makes, and sells diagnostic, medical, surgical, and patient care devices.

Investing Insights: Will the iPad 3 Be the Next Catalyst for Apple’s Stock?

C. R. Bard Earnings Cheat Sheet for the Fourth Quarter

Results: Net income for the medical instruments and supplies company fell to $113.8 million ($1.30 per share) vs. $136.2 million ($1.47 per share) a year earlier. This is a decline of 16.4% from the year earlier quarter.

Revenue: Rose 4.9% to $751.9 million from the year earlier quarter.

Actual vs. Wall St. Expectations: BCR reported adjusted net income of $1.70 per share. By that measure, the company beat the mean estimate of $1.68 per share. Analysts were expecting revenue of $748.6 million.

Quoting Management: Timothy M. Ring, chairman and chief executive officer, commented, “Fourth quarter constant currency net sales growth of 5% was at the top end of our guidance and allowed us to exceed adjusted EPS guidance for the quarter and for the year. Our revenue growth is being driven by a combination of geographic investments, external acquisitions and internal research and development. By combining top-line growth with disciplined expense management and share-repurchase programs, we have been able to meet our short-term commitments to shareholders while positioning the company for healthy long-term growth.”

Key Stats:

Gross margin shrank 0.7 percentage point to 62.5%. The contraction appeared to be driven by increased costs, which rose 7% from the year earlier quarter while revenue rose 4.9%.

Revenue has risen the past four quarters. Revenue increased 6% to $719.2 million in the third quarter. The figure rose 7.6% in the second quarter from the year earlier and climbed 7.6% in the first quarter from the year-ago quarter.

The company has now beaten estimates the last two quarters. In the third quarter, it topped expectations with net income of $1.62 versus a mean estimate of net income of $1.60 per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the first quarter of the next fiscal year has moved down from $1.65 a share to $1.56 over the last sixty days. For the fiscal year, the average estimate has been unchanged at $6.38 a share.

Competitors to Watch: Teleflex Incorporated (NYSE:TFX), Covidien plc (NYSE:COV), Boston Scientific Corp. (NYSE:BSX), Merit Medical Systems, Inc. (NASDAQ:MMSI), AngioDynamics, Inc. (NASDAQ:ANGO), Angiotech Pharmaceuticals, Inc. (NASDAQ:ANPI), Theragenics Corporation (NYSE:TGX), Rochester Medical Corp. (NASDAQ:ROCM), CONMED Corporation (NASDAQ:CNMD), and Becton, Dickinson and Co. (NYSE:BDX).

Stock Performance: Shares of BCR were up 0.4% from the previous close.

Investing Insights: Will the iPad 3 Be the Next Catalyst for Apple’s Stock?

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com