Sharps Compliance (SMED) Tops Q4 EPS by 12c

Sharps Compliance (NASDAQ: SMED) reported Q4 EPS of $0.13, $0.12 better than the analyst estimate of $0.01. Revenue for the quarter came in at $12.6 million versus the consensus estimate of $12.75 million.

David P. Tusa, President and Chief Executive Officer of Sharps, stated, “Despite what remains a challenging environment as the U.S. continues to contend with the public health and economic impacts associated with COVID-19, Sharps delivered a solid fourth quarter performance, with moderate revenue growth and improved margins while also achieving improved operating income and EBITDA. Customer billings increased 6% and we saw growth across all three of our key solutions: mailback, route-based, and unused medications. In these unprecedented times, we have remained focused on maintaining our ability to deliver, without interruption, our cost effective, comprehensive medical waste management services to the small to medium quantity generators who make up the vast majority of our customer base.”

Tusa continued, “World events have contributed to our view that we have a number of significant growth opportunities in many of our markets served. Accordingly, we are investing in the business to take full advantage of the opportunities and to be part of the solution to solve the current pandemic. For example, we have previously and continue to significantly increase manufacturing of our medical waste mailback inventory to be able to meet the anticipated strong demand. Additionally, we have brought our new autoclave online at our Texas facility, which expands our medical waste processing capacity from 10 million to 18 million pounds. We expect an additional autoclave at our Pennsylvania facility to be complete by October 2020. This will further increase our waste processing capacity to 27 million pounds annually, essentially tripling capacity. Finally, we continue to invest in our route-based business which now serves 32 states, addressing 70% of the population. In addition to facilitating our ability to service larger route-based prospects, the route-based business was critical to the near doubling of customer billings in the Assisted Living market for the June 2020 quarter.

“Looking forward, we have been very pleased to see a rebound in the July and August route-based business which is trending to September 2020 quarterly billings of an estimated $2.8 to $2.9 million. Additionally, while the number of MedSafe liners returned for processing dipped in the June 2020 quarter, they have returned to or exceeded pre-COVID-19 levels in July and August.”

For earnings history and earnings-related data on Sharps Compliance (SMED) click here.

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