Diplomat Pharmacy (DPLO) Misses Q1 EPS by 26c, Revenues Beat; Offers FY19 EPS Views Below Consensus, FY19 Revenue Mid-Point Guidance Above Consensus

Diplomat Pharmacy (NYSE: DPLO) reported Q1 EPS of ($0.19), $0.26 worse than the analyst estimate of $0.07. Revenue for the quarter came in at $1.26 billion versus the consensus estimate of $1.17 billion.

First Quarter 2019 Highlights include:

• Revenue of $1,257 million, compared to $1,342 million
  • Specialty segment revenue of $1,168 million, compared to $1,153 million
  • PBM segment revenue of $98 million, compared to $191 million
• Specialty segment total prescriptions dispensed of 225,000, compared to 223,000
• PBM segment total volume, adjusted to 30-day equivalent, of 1,045,000, compared to 2,181,000
• Gross margin of 6.3% versus 6.7%
  • Specialty segment gross margin of 5.8% versus 6.3%
  • PBM segment gross margin of 11.9% versus 9.2%
• EPS of $(0.19) per basic/diluted common share versus $(0.01) per basic/diluted common share
• Adjusted EBITDA of $23.1 million, compared to $39.6 million
  • Adjusted EBITDA margin of 1.8% versus 3.0%
• Net cash provided by operating activities was $23.7 million, compared to $48.6 million
• Net debt1 decreased to $622.5 million, from $638.2 million at December 31, 2018.

Brian Griffin, Chairman and CEO of Diplomat, commented "Our quarterly results reflect the competitive challenges we are facing in our core specialty pharmacy business and the impact of contract losses in the PBM business, while specialty infusion continues to be a bright spot. The company is starting to benefit from prior investments in sales and account management resources and we remain encouraged by the pipeline of opportunity across all of Diplomat\'s businesses as our value proposition gains traction in the market. We expect to achieve the previously communicated revenue and Adjusted EBITDA guidance for 2019, but have increased our GAAP net loss and EPS loss expectations due to a change in tax forecasts. Diplomat's Board and management team are committed to maximizing shareholder value, while maintaining focus on rebuilding our PBM business and expanding business with health plans, hospital systems and manufacturer partners."

GUIDANCE:

Diplomat Pharmacy sees FY2019 EPS of ($0.65)-($0.44), versus the consensus of $0.34. Diplomat Pharmacy sees FY2019 revenue of $4.7-5 billion, versus the consensus of $4.82 billion.

For earnings history and earnings-related data on Diplomat Pharmacy (DPLO) click here.

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