Hill-Rom Holdings (HRC) Sees Q1 Revenues Above the Street

Hill-Rom Holdings, Inc. (NYSE: HRC) today announced preliminary unaudited revenue for its fiscal first quarter of 2016.

Hill-Rom expects to report revenue of approximately $661 million for the quarter ended December 31, 2015, an increase of approximately 42 percent, or approximately 47 percent on a constant currency basis, compared to last year's first quarter. Excluding Welch Allyn, revenue on a constant currency basis increased 3 percent, while reported revenue was approximately flat.

*** consensus is $649.75 million.

First Quarter Preliminary Revenue

• North America Acute Care. North America Acute Care revenue grew 11 percent to approximately $249 million. Capital sales increased 10 percent year over year, while rental revenue grew 11 percent.
• Welch Allyn. Welch Allyn revenue was approximately $198 million, which on a pro-forma basis represents approximately 7 percent constant currency growth year over year.
• Surgical/Respiratory Care. Surgical and Respiratory Care revenue of approximately $121 million was flat on a constant currency basis year over year, or a decline of 5 percent on a reported basis.
• International. International segment revenue of approximately $94 million declined about 9 percent on a constant currency basis year over year, or a decline of 17 percent on a reported basis.

Other Highlights

• Impact of Tax Law Changes. The recently passed Consolidated Appropriations Act of 2015 included the permanent reinstatement of the R&D tax credit along with a two-year suspension of the Affordable Care Act medical device excise tax. Hill-Rom's previously announced 2016 earnings per share guidance included the medical device excise tax and excluded any R&D tax credit. The R&D tax credit reinstatement is expected to benefit Hill-Rom's fiscal 2016 earnings per share by approximately $0.03 in Q1 and $0.06 for the full year. The elimination of the medical device excise tax, which is effective January 1, 2016, could positively impact Hill-Rom's fiscal 2016 earnings per share by as much as $0.12.

Hill-Rom will release its final first quarter results and its financial outlook for Q2 and the full year on February 1, 2016, as previously announced.

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