Halyard Health (HYH) Misses Q2 EPS by 1c, Offers FY Outlook

Halyard Health (NYSE: HYH) reported Q2 EPS of $0.52, $0.01 worse than the analyst estimate of $0.53. Revenue for the quarter came in at $389 million versus the consensus estimate of $403.35 million.

Halyard Health sees FY2015 EPS of $1.90-$2.10, may not compare to the consensus of $2.31.

2015 Outlook and Key Planning Assumptions

The Company is revising its previously announced outlook for full-year 2015.

• Net sales growth, on a constant currency basis, is expected to decline 1 to 3 percent in 2015 compared to 2014.
• Adjusted earnings per diluted share, excluding the after-tax intangible amortization expense of approximately $0.34 per share, are anticipated to be $1.90 to $2.10 for the full year.

Based on current trends the Company is updating some of its key planning assumptions, as described below.

• S&IP net sales, on a constant currency basis, are expected to decline 3 to 5 percent.
• Deflation in key cost inputs of $20 to $25 million is anticipated.
• Capital spending is expected to be in the low end of the range of $70 to $75 million, which is slightly above the company's long-term target of 3 percent of net sales, due to spin-related projects.

Based on current trends we are affirming the following key planning assumptions:

• Medical Devices net sales, on a constant currency basis, are expected to increase 2 to 4 percent.
• Research and development investment is expected to be $30 to $35 million.
• With the continued strength of the U.S. dollar, we anticipate negative foreign currency translation impact to net sales at the high end of the range of 2.5 to 3.5 percent. Additionally, the Company expects the negative currency impact on operating profit at the high end of the $10 to $15 million range.
• Spin-off related transitional costs are expected to be $45 to $55 million in 2015.
• The adjusted effective tax rate is anticipated to be between 37.0 and 39.0 percent.

For earnings history and earnings-related data on Halyard Health (HYH) click here.

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