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Phibro (PAHC) Q3 Earnings Lag Estimates, 2022 Revenue View Up
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Phibro Animal Health Corporation's (PAHC - Free Report) adjusted earnings per share (EPS) of 33 cents for the third quarter of fiscal 2022 reflected a 2.9% drop from the year-ago adjusted figure. The metric also lagged the Zacks Consensus Estimate by 8.3%.
Meanwhile, without adjustments, GAAP EPS for the fiscal third quarter was 44 cents, up 0.4% from the year-ago figure.
Net Sales
In the quarter under review, net sales totaled $239.6 million, up 13.2% from the year-ago quarter. The figure exceeded the Zacks Consensus Estimate by 3.5%.
During the fiscal third quarter, Animal Health net sales increased 11% to $148.6 million. Within this segment, sales of medicated feed additives (MFAs) and others were $84.3 million, reflecting 7% year-over-year growth, driven by higher sales of processing aids used to improve production efficiency in the ethanol fermentation industry.
Phibro Animal Health Corporation Price, Consensus and EPS Surprise
Within Animal Health, nutritional specialty product sales rose 12% to $41.4 million, primarily banking on higher demand for dairy and microbial products, and increased revenues from the companion animal product.
Apart from this, net vaccine sales totaled $22.9 million, showing a rise of 21% year over year on increased domestic and international volumes.
Net sales at the Mineral Nutrition segment rose 19% year over year to $69 million on the increase in average selling prices of trace minerals, linked to the movement of the underlying raw material costs.
Net sales at the Performance Products segment rose 15% to $22 million. This growth was driven by higher volumes of ingredients for personal care products and higher volumes and average selling prices of copper-based products.
Margins
Phibro’s fiscal third-quarter gross profit rose 3.6% year over year to $71.6 million. However, gross margin contracted 276 basis points (bps) to 71.6% on a 17.8% rise in the cost of goods sold to $168 million.
Selling, general and administrative expenses in the reported quarter were $52.4 million, up 6.9% from the year-ago quarter.
Operating profit declined 4.5% year over year to $19.2 million and operating margin contracted 148 bps to 8% in the quarter under review.
Financial Update
The company exited the fiscal third quarter with cash and short-term investments in hand of $93 million compared with $95 million at the end of second-quarter fiscal 2022.
Cumulative net cash used in operating activities at the end of the third quarter was $30.1 million compared with $45.2 million a year ago.
Cumulative capital expenditure amounted to $25.2 million at the end of the third quarter of fiscal 2022, compared with $22.2 million in the year-ago quarter.
Outlook
Phibro has updated its fiscal 2022 financial guidance.
The company raised net sales guidance for fiscal 2022 in the range of $930-$950 million, an improvement from the earlier-provided band of $890-$920 million. The Zacks Consensus Estimate for the metric is pegged at $913.7 million.
The adjusted EPS guidance was reiterated in the band of $1.30-$1.39. The Zacks Consensus Estimate for the same is pegged at $1.38.
Our Take
Phibro exited third-quarter fiscal 2022 on a mixed note with better-than-expected revenues while adjusted EPS missed the mark. On a positive note, the year-over-year increase in the top line was primarily driven by continued demand for the company’s products globally. Robust performance by the Animal Health and Mineral Health segments buoys optimism. Further, the company has raised its revenue guidance for fiscal 2022 on improving business trends.
On the flip side, the increases in raw material costs and freight costs continue to pose challenges. Contraction of both margins is another disadvantage.
Zacks Rank and Key Picks
Currently, Phibro carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Alkermes plc (ALKS - Free Report) , Medpace Holdings, Inc. (MEDP - Free Report) and UnitedHealth Group Incorporated (UNH - Free Report) .
Alkermes reported first-quarter 2022 adjusted EPS of 12 cents, which surpassed the Zacks Consensus Estimate of a penny. Revenues of $278.6 million outpaced the Zacks Consensus Estimate by 6.2%. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Alkermes has an estimated long-term growth rate of 25.1%. ALKS’ earnings surpassed estimates in the trailing four quarters, the average surprise being 350.5%.
Medpace reported first-quarter 2022 adjusted EPS of $1.69, which surpassed the Zacks Consensus Estimate by 34.1%. Revenues of $330.9 million outpaced the Zacks Consensus Estimate by 1.1%. It currently has a Zacks Rank #2.
Medpace has a historical growth rate of 27.3%. MEDP’s earnings surpassed estimates in the trailing four quarters, the average surprise being 17.1%.
UnitedHealth, having a Zacks Rank #2, reported first-quarter 2022 adjusted EPS of $5.49, which beat the Zacks Consensus Estimate by 1.7%. Revenues of $80.1 billion outpaced the consensus mark by 1.9%.
UnitedHealth has an estimated long-term growth rate of 14.8%. UNH’s earnings surpassed estimates in the trailing four quarters, the average surprise being 3.7%.
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Phibro (PAHC) Q3 Earnings Lag Estimates, 2022 Revenue View Up
Phibro Animal Health Corporation's (PAHC - Free Report) adjusted earnings per share (EPS) of 33 cents for the third quarter of fiscal 2022 reflected a 2.9% drop from the year-ago adjusted figure. The metric also lagged the Zacks Consensus Estimate by 8.3%.
Meanwhile, without adjustments, GAAP EPS for the fiscal third quarter was 44 cents, up 0.4% from the year-ago figure.
Net Sales
In the quarter under review, net sales totaled $239.6 million, up 13.2% from the year-ago quarter. The figure exceeded the Zacks Consensus Estimate by 3.5%.
During the fiscal third quarter, Animal Health net sales increased 11% to $148.6 million. Within this segment, sales of medicated feed additives (MFAs) and others were $84.3 million, reflecting 7% year-over-year growth, driven by higher sales of processing aids used to improve production efficiency in the ethanol fermentation industry.
Phibro Animal Health Corporation Price, Consensus and EPS Surprise
Phibro Animal Health Corporation price-consensus-eps-surprise-chart | Phibro Animal Health Corporation Quote
Within Animal Health, nutritional specialty product sales rose 12% to $41.4 million, primarily banking on higher demand for dairy and microbial products, and increased revenues from the companion animal product.
Apart from this, net vaccine sales totaled $22.9 million, showing a rise of 21% year over year on increased domestic and international volumes.
Net sales at the Mineral Nutrition segment rose 19% year over year to $69 million on the increase in average selling prices of trace minerals, linked to the movement of the underlying raw material costs.
Net sales at the Performance Products segment rose 15% to $22 million. This growth was driven by higher volumes of ingredients for personal care products and higher volumes and average selling prices of copper-based products.
Margins
Phibro’s fiscal third-quarter gross profit rose 3.6% year over year to $71.6 million. However, gross margin contracted 276 basis points (bps) to 71.6% on a 17.8% rise in the cost of goods sold to $168 million.
Selling, general and administrative expenses in the reported quarter were $52.4 million, up 6.9% from the year-ago quarter.
Operating profit declined 4.5% year over year to $19.2 million and operating margin contracted 148 bps to 8% in the quarter under review.
Financial Update
The company exited the fiscal third quarter with cash and short-term investments in hand of $93 million compared with $95 million at the end of second-quarter fiscal 2022.
Cumulative net cash used in operating activities at the end of the third quarter was $30.1 million compared with $45.2 million a year ago.
Cumulative capital expenditure amounted to $25.2 million at the end of the third quarter of fiscal 2022, compared with $22.2 million in the year-ago quarter.
Outlook
Phibro has updated its fiscal 2022 financial guidance.
The company raised net sales guidance for fiscal 2022 in the range of $930-$950 million, an improvement from the earlier-provided band of $890-$920 million. The Zacks Consensus Estimate for the metric is pegged at $913.7 million.
The adjusted EPS guidance was reiterated in the band of $1.30-$1.39. The Zacks Consensus Estimate for the same is pegged at $1.38.
Our Take
Phibro exited third-quarter fiscal 2022 on a mixed note with better-than-expected revenues while adjusted EPS missed the mark. On a positive note, the year-over-year increase in the top line was primarily driven by continued demand for the company’s products globally. Robust performance by the Animal Health and Mineral Health segments buoys optimism. Further, the company has raised its revenue guidance for fiscal 2022 on improving business trends.
On the flip side, the increases in raw material costs and freight costs continue to pose challenges. Contraction of both margins is another disadvantage.
Zacks Rank and Key Picks
Currently, Phibro carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Alkermes plc (ALKS - Free Report) , Medpace Holdings, Inc. (MEDP - Free Report) and UnitedHealth Group Incorporated (UNH - Free Report) .
Alkermes reported first-quarter 2022 adjusted EPS of 12 cents, which surpassed the Zacks Consensus Estimate of a penny. Revenues of $278.6 million outpaced the Zacks Consensus Estimate by 6.2%. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Alkermes has an estimated long-term growth rate of 25.1%. ALKS’ earnings surpassed estimates in the trailing four quarters, the average surprise being 350.5%.
Medpace reported first-quarter 2022 adjusted EPS of $1.69, which surpassed the Zacks Consensus Estimate by 34.1%. Revenues of $330.9 million outpaced the Zacks Consensus Estimate by 1.1%. It currently has a Zacks Rank #2.
Medpace has a historical growth rate of 27.3%. MEDP’s earnings surpassed estimates in the trailing four quarters, the average surprise being 17.1%.
UnitedHealth, having a Zacks Rank #2, reported first-quarter 2022 adjusted EPS of $5.49, which beat the Zacks Consensus Estimate by 1.7%. Revenues of $80.1 billion outpaced the consensus mark by 1.9%.
UnitedHealth has an estimated long-term growth rate of 14.8%. UNH’s earnings surpassed estimates in the trailing four quarters, the average surprise being 3.7%.