Teleflex Reports Fourth Quarter and Full Year 2020 Results

Teleflex

WAYNE, PA — Teleflex Incorporated (NYSE: TFX) recently announced financial results for the fourth quarter and full year ended December 31, 2020.

Fourth quarter 2020 net revenues were $711.2 million, an increase of 4.4% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues increased 2.3% over the year ago period. The Company estimates that COVID-19 had a net negative impact to fourth quarter 2020 revenue of approximately $61 million, or 9%.

Fourth quarter 2020 GAAP earnings per share from continuing operations decreased 28.9% to $1.62, compared to $2.28 in the prior year period. Fourth quarter 2020 adjusted diluted earnings per share from continuing operations decreased 0.9% to $3.25, compared to $3.28 in the prior year period.

Full year 2020 net revenues were $2.537 billion, a decrease of 2.2% compared to the prior year. Excluding the impact of foreign currency exchange rate fluctuations, full year 2020 net revenues decreased 2.4% over the prior year. The Company estimates that COVID-19 had a net negative impact to full year 2020 revenue of approximately $281 million, or 11%.

Full year 2020 GAAP earnings per share from continuing operations decreased 27.6% to $7.10, compared to $9.81 in the prior year. Full year 2020 adjusted diluted earnings per share from continuing operations decreased 4.3% to $10.67, compared to $11.15 in the prior year.

Liam Kelly, Chairman, President and Chief Executive Officer, said, “Due to the COVID-19 pandemic, 2020 was a difficult year for Teleflex. However, during the fourth quarter our business performed better than we expected, as trends continued to improve across many of our product categories and geographies.”

Mr. Kelly continued, “In addition to the significant sequential improvement in our constant currency revenue performance that we experienced in the fourth quarter, I am also very pleased to see the continued sequential improvement that occurred in both our adjusted gross and adjusted operating margins, as we believe this positions us well to achieve our longer-term financial objectives.”

Mr. Kelly concluded, “As we look forward to 2021, despite the ongoing COVID-19 pandemic, we remain confident in our diversified product portfolio and in our ability to deliver robust revenue growth, margin expansion and adjusted earnings growth, all while investing in our business to sustain our revenue growth and profitability profile over the long-term.”

NET REVENUE BY SEGMENT

The following tables and commentary provide information regarding net revenues in each of the Company’s reportable operating segments for the three and twelve months ended December 31, 2019 and December 31, 2020 on both a GAAP and constant currency basis. The discussion below the tables of the principal factors behind changes in net revenues for the three months ended December 31, 2020 as compared to the prior year period applies to both GAAP revenue and constant currency revenue, although GAAP revenue also was affected by foreign currency exchange rate fluctuations, as indicated in the “Currency Impact” column of the table.

Three Months Ended % Increase / (Decrease)
December 31, 2020 December 31, 2019 Total Sales Growth
Currency Impact
Constant Currency Revenue Growth
Americas $ 419.5 $ 400.0 4.9 % (0.1 )% 5.0 %
EMEA 161.4 145.9 10.6 % 6.5 % 4.1 %
Asia 78.6 80.5 (2.3 )% 4.9 % (7.2 )%
OEM 51.7 54.6 (5.5 )% 1.4 % (6.9 )%
Total $ 711.2 $ 681.0 4.4 % 2.1 % 2.3 %
Twelve Months Ended
% Increase / (Decrease)
December 31, 2020
December 31, 2019

Total Sales Growth Currency Impact Constant Currency Revenue Growth
Americas $ 1,465.0 $ 1,492.3 (1.8 )% (0.2 )% (1.6 )%
EMEA 584.9 588.1 (0.5 )% 1.1 % (1.6 )%
Asia 267.0 294.3 (9.3 )% 0.3 % (9.6 )%
OEM 220.3 220.7 (0.2 )% 0.4 % (0.6 )%
Total $ 2,537.2 $ 2,595.4 (2.2 )% 0.2 % (2.4 )%
READ:  West to Host First-Quarter 2021 Conference Call

Americas fourth quarter 2020 net revenues were $419.5 million, an increase of 4.9% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues increased 5.0% compared to the prior year period. The increase in constant currency revenue was primarily attributable to increased sales volumes of existing and new products, partially offset by a net decrease in sales volumes of existing products caused by the COVID-19 pandemic. The Company estimates that COVID-19 had a negative impact to fourth quarter 2020 revenue of approximately $29 million, or 7%.

EMEA fourth quarter 2020 net revenues were $161.4 million, an increase of 10.6% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues increased 4.1% compared to the prior year period. The increase in constant currency revenue was primarily attributable to increased sales volumes of existing products, partially offset by a net decrease in sales volumes of existing products caused by the COVID-19 pandemic. The Company estimates that COVID-19 had a negative impact to fourth quarter 2020 revenue of approximately $1 million, or 1%.

Asia fourth quarter 2020 net revenues were $78.6 million, a decrease of 2.3% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues decreased 7.2% compared to the prior year period. The decrease in constant currency revenue was primarily attributable to a net decrease in sales volumes of existing products caused by the COVID-19 pandemic. The Company estimates that COVID-19 had a negative impact to fourth quarter 2020 revenue of approximately $10 million, or 12%.

OEM fourth quarter 2020 net revenues were $51.7 million, a decrease of 5.5% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues decreased 6.9% compared to the prior year period. The decrease in constant currency revenue was primarily attributable to a decrease in sales volumes of existing products caused by the COVID-19 pandemic, partially offset by net revenues generated by the acquisition of IWG High Performance Conductors, Inc. (HPC). The Company estimates that COVID-19 had a negative impact to fourth quarter 2020 revenue of approximately $21 million, or 38%.

NET REVENUE BY GLOBAL PRODUCT CATEGORY

The following tables and commentary provide information regarding net revenues in each of the Company’s global product categories for the three months and twelve months ended December 31, 2019 and December 31, 2020 on both a GAAP and constant currency basis.

READ:  Vishay Intertechnology BiSy 2-Line ESD Protection Diode Features Space-Saving DFN1110-3A Package With Wettable Flanks
Three Months Ended % Increase / (Decrease)
December 31, 2020 December 31, 2019 Total Revenue Growth Currency Impact Constant Currency Revenue Growth
Vascular Access $ 182.5 $ 154.6 18.0 % 2.0 % 16.0 %
Interventional 106.7 112.7 (5.3 ) % 1.6 % (6.9 ) %
Anesthesia 86.1 85.3 0.9 % 3.0 % (2.1 ) %
Surgical 92.3 95.2 (3.0 ) % 2.7 % (5.7 ) %
Interventional Urology 93.9 89.1 5.4 % 0.1 % 5.3 %
OEM 51.7 54.6 (5.5 ) % 1.4 % (6.9 ) %
Other 98.1 89.4 9.8 % 3.7 % 6.1 %
Total $ 711.2 $ 681.0 4.4 % 2.1 % 2.3 %
Twelve Months Ended % Increase / (Decrease)
December 31, 2020 December 31, 2019 Total Revenue Growth Currency Impact Constant Currency Revenue Growth
Vascular Access $ 657.7 $ 600.9 9.5 % 0.1 % 9.4 %
Interventional 382.4 427.6 (10.6 ) % 0.1 % (10.7 ) %
Anesthesia 302.3 338.4 (10.7 ) % 0.2 % (10.9 ) %
Surgical 317.2 370.1 (14.3 ) % 0.2 % (14.5 ) %
Interventional Urology 290.0 290.4 (0.1 ) % 0.1 % (0.2 ) %
OEM 220.3 220.7 (0.2 ) % 0.4 % (0.6 ) %
Other 367.3 347.3 5.8 % 0.5 % 5.3 %
Total $ 2,537.2 $ 2,595.4 (2.2 ) % 0.2 % (2.4 ) %

Fourth quarter 2020 net revenues from sales of Vascular Access products were $182.5 million, an increase of 18.0% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues increased 16.0% compared to the prior year period. The Company estimates that COVID-19 had a net positive impact to fourth quarter 2020 revenue of approximately $7 million, or 5%.

Fourth quarter 2020 net revenues from sales of Interventional products were $106.7 million, a decrease of 5.3% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues decreased 6.9% compared to the prior year period. The Company estimates that COVID-19 had a negative impact to fourth quarter 2020 revenue of approximately $14 million, or 12%.

Fourth quarter 2020 net revenues from sales of Anesthesia products were $86.1 million, an increase of 0.9% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues decreased 2.1% compared to the prior year period. The Company estimates that COVID-19 had a negative impact to fourth quarter 2020 revenue of approximately $1 million, or 1%.

Fourth quarter 2020 net revenues from sales of Surgical products were $92.3 million, a decrease of 3.0% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues decreased 5.7% compared to the prior year period. The Company estimates that COVID-19 had a negative impact to fourth quarter 2020 revenue of approximately $9 million, or 9%.

Fourth quarter 2020 net revenues from sales of Interventional Urology products were $93.9 million, an increase of 5.4% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues increased 5.3% compared to the prior year period. The Company estimates that COVID-19 had a negative impact to fourth quarter 2020 revenue of approximately $25 million, or 28%.

Fourth quarter 2020 net revenues from sales of OEM products were $51.7 million, a decrease of 5.5% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues decreased 6.9% compared to the prior year period. The Company estimates that COVID-19 had a negative impact to fourth quarter 2020 revenue of approximately $21 million, or 38%.

READ:  Trinseo Announces Conference Call for First Quarter 2021 Financial Results

Fourth quarter 2020 net revenues from sales of other products were $98.1 million, an increase of 9.8% compared to the prior year period. Excluding the impact of foreign currency exchange rate fluctuations, fourth quarter 2020 net revenues increased 6.1% compared to the prior year period. The Company estimates that COVID-19 had a positive impact to fourth quarter 2020 revenue of approximately $1 million, or 1%.

OTHER FINANCIAL HIGHLIGHTS AND KEY PERFORMANCE METRICS

Depreciation expense, amortization of intangible assets and deferred financing charges for the year ended December 31, 2020 totaled $231.7 million compared to $218.4 million for the prior year.

Cash and cash equivalents at December 31, 2020 were $375.9 million compared to $301.1 million at December 31, 2019.

Net accounts receivable at December 31, 2020 were $395.1 million compared to $418.7 million at December 31, 2019.

Net inventories at December 31, 2020 were $513.2 million compared to $476.6 million at December 31, 2019.

Net cash provided by operating activities from continuing operations was $437.1 million during 2020, as compared to $437.1 million during 2019. In 2020, the cash flow from operations reflect an increase in contingent consideration payments and tax payments that were mainly offset by favorable changes in other working capital. The favorable changes in other working capital were driven mainly by higher accounts receivable collections.

2021 OUTLOOK

On a GAAP basis, full year 2021 revenues are expected to increase between 10.0% and 11.5% over 2020, reflecting the Company’s estimate of an approximately 2% favorable impact of foreign currency exchange rate fluctuations. On a constant currency basis, the Company estimates that revenues for full year 2021 will increase between 8.0% and 9.5% over 2020.

The Company expects full year 2021 GAAP diluted earnings per share from continuing operations to be between $8.15 and $8.25. The Company expects adjusted diluted earnings per share from continuing operations to be between $12.50 and $12.70 for full year 2021, representing an increase of between 17.2% and 19.0% over 2020.

Forecasted 2021 Constant Currency Revenue Growth Reconciliation

Low High
Forecasted 2021 GAAP revenue growth 10.0 % 11.5 %
Estimated impact of foreign currency exchange rate fluctuations 2.0 % 2.0 %
Forecasted 2021 constant currency revenue growth 8.0 % 9.5 %

Forecasted 2021 Adjusted Diluted Earnings Per Share From Continuing Operations Reconciliation

Low High
Forecasted GAAP diluted earnings per share from continuing operations $ 8.15 $ 8.25
Restructuring, restructuring related and impairment items, net of tax $ 0.60 $ 0.61
Acquisition, integration and divestiture related items, net of tax $ 0.13 $ 0.14
Other items, net of tax $ 0.17 $ 0.19
MDR $ 0.48 $ 0.50
Intangible amortization expense, net of tax $ 2.97 $ 3.01
Forecasted adjusted diluted earnings per share from continuing operations $ 12.50 $ 12.70

Thanks for visiting! MyChesCo brings reliable information and resources to Chester County, Pennsylvania. Please consider supporting us in our efforts. Your generous donation will help us continue this work and keep it free of charge. Show your support today by clicking here and becoming a patron.

Buy Us a Cup of Coffee