Dentsply Sirona Follows Peers With Challenging 3Q23; Notes Survey Data Showing Declining Global Volumes and Increased Cancellations
11-3-23 (by: Scott Gleason) Dentsply Sirona has reported its financial results for the third quarter of 2023 flat at $947 million and organic sales declining 0.3%. The results came in below wall street estimates of $975.4 million. Management noted that based upon its dental surveys, global dental volumes are down and cancellations for procedures are up.
In the company’s Connected Technology Solutions segment, total revenue was down 4%. The company noted that CAD/CAM solutions for dental restoration saw low single digit growth but imaging solution sales were down in the quarter. Management noted a customer inventory build with CAD/CAM in September with anticipated lower inventories at year end driving lower sales in the fourth quarter.
The company’s Essential Dental Solutions were relatively flat year-over-year which the company attributed to declining volume in Europe.
Orthodontic and Implant Solutions grew 2% year-over-year. The company noted that its clear aligners grew 10% year-over-year compared to 8% growth from competitor Align Technology, and double-digit growth from Envista’s Spark technology. The company noted that it has now treated one million patients with SureSmile and it recently launched its simulation tool on its DSCore software offering.
Wellspect Healthcare, the company’s bladder and bowel solutions business was up 10% attributable to volume growth and new product launches.
Adjusted earnings per diluted share increased to $0.49 from $0.41 in the third quarter of 2022. The enhanced adjusted earnings per share were driven by cost reductions, expanded adjusted EBITDA margin, and a reduced tax rate. Street forecasts were looking for adjusted EPS of $0.48.
Dentsply Sirona revised its 2023 outlook. The company now anticipates organic sales growth of approximately 1%, with net sales ranging from $3.90 billion to $3.94 billion. Previously the company had been calling for 3% organic growth. Adjusted EPS for 2023 is expected to fall within the range of $1.80 to $1.85 compared to the previous range of $1.92 to $2.02.
Simon Campion, President and Chief Executive Officer, pointed out that despite the challenging circumstances affecting sales, the company managed to achieve an adjusted EBITDA margin of over 18% and a 20% growth in adjusted EPS. He emphasized the significant progress made in the company’s transformation initiatives aimed at improving operational execution and delivering innovative solutions to customers.