
What Hospital Capital Equipment Challenges? GE Healthcare Maintains Full Year Growth Outlook
10-31-23 (by: Scott Gleason) GE HealthCare has released its financial results for the third quarter with total reported revenues of $4.8 billion, marking a 5% increase year-over-year. The results were in-line with analyst expectations who had also expected revenue of $4.8 million. On an organic basis, revenue growth was 6%.
Imaging revenues were $2.6 billion and increased by 5% year-over-year, driven by molecular imaging, computed tomography, and magnetic resonance. Management attributed the growth to supply chain enhancements, pricing, and new product introductions. Ultrasound revenues of $815 million declined by 1%. Patient Care Solutions revenue was $764 million and increased by 9%, driven by volume, supply chain fulfillment improvements, and price. Pharmaceutical Diagnostics revenue was $589 and grew 13% based upon volume and pricing.
The total company’s book-to-bill ratio for the quarter stood at 1.03 with total company orders growing by 1% organically. GE is highly subjected to hospital capital equipment budgets which have been a concern of investors so the strong book-to-bill in the quarter is a positive sign for the company.
Adjusted EBIT was $744 million and the adjusted EBIT margin was 15.4%, reflecting improvements in productivity and price. Adjusted EPS reached $0.99, exceeding consensus expectations of $0.90. The company’s cash flow from operating activities increased to $650 million compared to $622 million in the prior year.
The company’s growth and innovation initiatives include collaborations with organizations such as Novo Nordisk, expansion in medical research with novel photon counting CT technology, the launch of advanced ultrasound systems featuring AI-driven Caption Guidance, and FDA clearance for new patient monitoring solutions.
GE HealthCare also provided guidance for full-year 2023, expecting organic revenue growth between 6% and 8% year-over-year. The company anticipates an adjusted EBIT margin of 15.0% to 15.5% and adjusted EPS is projected to be in the range of $3.75 to $3.85, reflecting growth and improvement in performance. The guidance is largely in-line with its previous guidance after the second quarter.