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Product / Company Performance

Zimmer Biomet Reports 1Q19 Orthopedic Revenue of $1,759.4MM, -2.2% vs. 1Q18 -

By Mike Evers, ORTHOWORLD

Zimmer Biomet reported 1Q19 orthopedic revenue of USD $1,759.4MM, -2.2% vs. 1Q18.

Performance Notes

  • Short-term company priorities: supply recovery, increasing supply efficiency, quality remediation, new product launches and optimizing talent structure
  • Remain on track to deliver 2% to 3% growth in 2020
  • Expect revenue growth to accelerate in 2H19 due to new products
  • Company expects 2019 general orthopedic volume to be very close to 2018

 

ROSA Updates

  • Zimmer Biomet generated over 2,000 leads at AAOS (up from just over 100 a year ago), with a “decent portion” of those leads focused on ROSA
  • Early feedback in ROSA total knee limited launch is that the system quickly allows surgeons to achieve “time neutrality” in their procedure flow
  • Company will be flexible in ways for customers to acquire a unit, but will prioritize getting units into “platinum” high-volume accounts penetrated by Stryker’s Mako

 

ORTHOWOLRD estimates segment values and growth on an as-reported basis as follows ($MM).

  1Q19 1Q18 $ Chg % Chg
Joint Replacement $1,282.3 $1,311.9 -$29.6 -2.3%
Knees $694.1 $713.3 -$19.2 -2.7%
Hips $484.2 $492.0 -$7.8 -1.6%
Extremities $104.0 $106.6 -$2.6 -2.4%
Spine $105.6 $110.5 -$4.9 -4.4%
Trauma $145.8 $146.0 -$0.3 -0.2%
Sports Medicine $34.3 $33.5 $0.8 2.3%
Orthobiologics $70.4 $72.0 -$1.6 -2.2%
Other * $121.1 $125.9 -$4.8 -3.8%
Total $1,759.4 $1,799.9 -$40.4 -2.2%

* CMF, Bone Healing, Forgings, Accelero

Estimated orthopedic revenue by geographic region is as follows ($MM).

Geographic Region 1Q19 1Q18 $ Chg % Chg
US $1,010.7 $1,023.7 -$13.0 -1.3%
Ex-US $748.7 $776.1 -$27.4 -3.5%
   EMEA $413.2 $442.9 -$29.8 -6.7%
   Asia Pacific $282.8 $279.2 $3.6 1.3%
   Other $52.8 $54.0 -$1.2 -2.2%
Total $1,759.4 $1,799.9 -$40.4 -2.2%

Net earnings, inclusive for all Zimmer Biomet revenue, is as follows.

1Q19 Amount ($MM) % of Sales
Sales $1,975.5  
   Cost of Sales -$553.4 28.0%
   Selling and Admin -$796.4 40.3%
   R & D -$101.7 5.1%
   Other -$277.8 14.1%
Net Earnings $246.2 12.5%

 

Sources: Zimmer Biomet; ORTHOWORLD estimates.

Mike Evers is ORTHOWORLD’s Market Analyst. He can be reached by email.

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