Mindray Medical Q4 Results Miss View; Names Li Xiting Executive Chairman

(RTTNews) - Chinese medical device maker Mindray Medical International Ltd. (MR) on Monday reported a 31 percent decline in profit for the fourth quarter from last year as higher revenues were more than offset by lower margins and an increase in expenses.

Both revenue and adjusted earnings per share for the quarter missed analysts' expectations. Looking ahead, the company forecast financial results for fiscal 2015 below Street estimates.

The Shenzhen-based company reported net income for the fourth quarter of $51.99 million or $0.44 per share, down from $75.22 million or $0.63 per share in the prior-year quarter.

Excluding items, adjusted net income for the quarter was $0.50 per share, compared to $0.62 per share in the year-ago quarter.

On average, three analysts polled by Thomson Reuters expected the company to report earnings of $0.52 per share for the quarter. Analysts' estimates typically exclude special items.

Net revenues for the quarter increased 8 percent to $398.96 million from $368.42 million in the same quarter last year. Analysts expected revenues of $407.07 million for the quarter.

China net revenues grew 14 percent from the year-ago period to $182.7 million, while international revenues increased 4 percent to $216.2 million. Western Europe sales achieved double-digit net revenue growth from a year ago.

Reagent sales contributed 48.2 percent to the IVD segment, up from 41.4 percent in the same period last year.

Operating margin for the quarter contracted 120 basis points from last year to 13.4 percent, primarily as gross margin declined 60 basis points. Selling expenses as a percentage of total revenues increased 280 basis points.

Mindray said its board of directors declared a cash dividend on its orindary shares of $0.40 per share, based on the company's net income for the full year 2014. The cash dividend will be payable on or around March 31, 2015 to shareholders of record as of March 19, 2015.

Looking ahead to fiscal 2015, Mindray expects adjusted earnings to decrease by a high-single digit percentage and net revenues to grow by a mid-single digit percentage, compared with last year.

Analysts expect the company to report earnings of $1.96 per share for the year on revenue growth of 11.1 percent to $1.48 billion.

Separately, the company said it has appointed Li Xiting as executive chairman of the board. Xiting is currently serving as the company's president, co-chief executive officer and director. Xu Hang will continue to serve as chairman of the board.

MR closed Monday's regular trading session at $29.42, down $0.57 or 1.9 percent on a volume of 0.87 million shares. In after-hours, the stock further declined $1.40 or 4.76 percent to $28.02.