Heska (HSKA) Tops Q3 EPS by 8c, Slight Miss on Revenues

Heska (NASDAQ: HSKA) reported Q3 EPS of $0.43, $0.08 better than the analyst estimate of $0.35. Revenue for the quarter came in at $31 million versus the consensus estimate of $31.55 million.

Kevin Wilson, Heska's Chief Executive Officer and President, commented, "The third quarter met our Outlook for revenues, exceeded our Outlook for gross margin, and delivered solid earnings per share before the non-recurring charges, allowing us room to accelerate research, development and headcount growth investments which counted against operating income in the period. We continue to focus on growing our highest quality revenue streams and are having success in key areas such as Point of Care Laboratory Consumables, which rose 19.3% (Outlook 15-20%) and Point of Care Imaging, which rose 24.3% (Outlook 10-12%). Emphasis on these higher quality revenues improved company-wide operating profitability while offsetting an expected 950 bps decrease to 36.2% in the OVP segment gross margins primarily from anticipated OVP product mix and plant utilization factors. Pet owners, veterinarians, pricing, utilization, and overall industry trends continue to display broad-based health.

For the full year, Heska continues to anticipate (i) OVP segment achieving our Outlook for approximately 22% gross margins, with higher margin product mix skewed to the fourth quarter, (ii) consolidated gross margin expansion from healthy sales growth and margins in key CCA segment business lines, and (iii) 15-20% in Point of Care Laboratory Consumables and 10-12% in Imaging sales growth.

Personnel, product development and research investments continue to ramp up in-step with our growth plans," Mr. Wilson continued. "Geographic expansion announced in our Outlook continues largely on pace with my expectations. New leadership has been hired and teams are forming to compete in Australia and core Eurozone territories in the first half of 2019."

For earnings history and earnings-related data on Heska (HSKA) click here.

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