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The Arlington-based medical device maker reported third-quarter sales of $117.7 million, a 6 percent increase over the same period a year ago.
Earnings for the quarter were flat against the third quarter of 2008 at $4.2 million, or 11 cents per share.
Wright CEO Gary Henley said in a conference call that the "better-than-expected" results were due to a mixture of elements.
"Highlights for the quarter were continued excellent sales performance by our U.S. extremities franchise, significant improvement in our international business and better-than-expected foreign currency exchange rates," Henley said. "Together these helped us exceed our top-line guidance range."
Earnings were affected by $3.3 million in stock-based compensation, $1.6 million spent on the ongoing and industry-wide investigations by the U.S. Department of Justice and $131,000 in charges related to the company's closure of its Toulon, France, distribution operation. These charges are basically the same as third-quarter 2008.
"I thought (the quarter) was a good surprise despite some costs associated with closing down a factory in France," Williams Capital Group LP analyst Beth Senko said. "(Wright) is a well-run company and a small company which competes in the same market as some of the big players but have managed to make a nice niche, and that showed in the quarter."
Wright announced this quarter that it would move its French distribution and support operations to its European headquarters in Amsterdam. The move is expected to cost $4 million to $5 million, with most of the charges to be recorded in the fourth quarter. The company also launched an Australian subsidiary in the third quarter for direct sales of its extremities and biologics products.
The new subsidiary, Wright Medical Australia Pty Ltd., was launched as part of Wright's continuing global strategy of specializing its selling efforts.
"An opportunity existed with extremities and biologics to make this move toward better specialization in the marketplace," Wright CFO John Bakewell said when the news was released last month. "We saw an unmet need of underserved physicians and that created a compelling reason to service the area with our own direct-selling efforts."
-- Toby Sells: 529-2742
Wright Medical Group Inc.
2009 sales guidance: $480 million to $485 million
Shuttered: French distribution and support operation
Launched: Australian subsidiary for extremity products
Contact: 867-9971
Web site: wmt.com
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