Teleflex shares slump as hurricane impact weighs on annual revenue forecast (updated)

Teleflex Incorporated

31/10/2024 16:02

(Rewrites paragraph 1 to reflect revenue forecast cut, adds
comments from conference call in paragraphs 2,3,7,9)
    By Mariam Sunny
       Oct 31 (Reuters) - Teleflex  TFX.N  shares dropped more
than 16% on Thursday, after the surgical instrument maker cut
its annual revenue forecast to reflect canceled surgeries in the
current quarter and an ongoing shortage of intravenous saline
fluids in the United States.
    The company said it saw cancellations of some procedures
early in the fourth quarter due to disruptions from recent
hurricanes in the U.S.
    CEO Liam Kelly said on the earnings conference call that the
company expects this to be a "short term, temporary" impact to
its operations.
    Teleflex now expects its annual revenue to grow between 2.9%
and 3.4%, down from a 3.4% to 4.4% increase expected earlier.
    Production at Baxter International's  BAX.N  North Carolina
plant, which makes 60% of the United States' supply of IV
fluids, was temporarily closed late last month due to flooding
caused by the Hurricane Helene.
    The shortage of IV products is forcing hospitals to defer
elective procedures and could hurt companies that make related
medical devices, according to analysts.
    Besides, Kelly said Teleflex's OEM segment, which makes
instruments for other device manufacturers, saw an
"unanticipated softness" in the third quarter.
    The unit reported quarterly sales of $82.6 million, below
estimates of $88.95 million, a consensus of four analysts
compiled by LSEG showed.
    Teleflex said its quarterly results were also impacted by an
ongoing doctors' strike in South Korea, which it expects to
linger through the remainder of the year.
    Revenue for the third quarter rose 2.4% to $764.4 million,
but missed estimates of $769.6 million.
    Adjusted profit per share of $3.49 for the three months
ended Sept. 29 topped estimates of $3.39.
    The Wayne, Pennsylvania-based company also raised the lower
end of its 2024 adjusted per-share profit forecast to $13.90
from $13.80 previously, while keeping the upper end at $14.20.

 (Reporting by Puyaan Singh and Mariam Sunny in Bengaluru;
Editing by Shilpi Majumdar)
 ((Puyaan.Singh@thomsonreuters.com))