Symmetry Surgical, a subsidiary of orthopedic implants and instruments maker Symmetry Medical, Inc. , recently signed a distribution agreement with renowned UK-based healthcare company, Hospital Innovations. As per the terms of the deal, Hospital Innovations will distribute Symmetry Surgical’s surgical instruments in UK.
Hospital Innovations distributes cutting-edge medical devices to about 400 hospitals across UK. The partnership will enable Symmetry Surgical to grow its customer base in the European market.
The distribution agreement is in line with Symmetry Surgical’s focus on worldwide expansion of its business inclusive of all brands under the erstwhile Codman Surgical Instruments. The company further plans to expand into other key European countries to gain healthy revenue opportunities.
Since Symmetry Medical’s core Original Equipment Manufacturer (“OEM”) Solutions business is facing declining capital spending, procedural and pricing pressure from the weak global orthopedic market, the company is focused on expanding its smaller Symmetry Surgical business.
Earlier, in Nov 2012, Symmetry Surgical collaborated with leading medical device distributor, MTG Medical Technologies (“MTG”) to sell its offerings in Europe. MTG, a subsidiary of Neuro-Competence, distributes cutting-edge yet affordable medical devices to hospitals located across Germany, Austria, Switzerland, Czech Republic, Hungary and Slovakia.
In the fourth quarter of 2012, revenues from the smaller Symmetry Surgical unit jumped 154% to $28.5 million, buoyed by the acquisition of Codman & Shurtleff, Inc., which contributed roughly $13.1 million to the division’s sales. Revenues also include a one-time purchase of an OEM Solutions client worth $2.9 million. Excluding the acquisition and the one-time purchase, sales increased 10.4% year over year in the quarter.
However, the company currently has a Zacks Rank #4 (Sell), as both revenues and earnings missed the Zacks Consensus Estimates in the fourth quarter of 2012. While we remain on the sidelines regarding Symmetry, companies such as Nuvasive Inc. (NUVA - Snapshot Report), Essilor International SA (ESLOY) and Cyberonics Inc. (CYBX - Analyst Report), each carrying a Zacks Rank #1 (Strong Buy), warrant a look.