Zimmer Biomet Holdings, Inc. (NYSE and SIX: ZBH) today reported financial results for the quarter ended March 31, 2022. The Company reported first quarter net sales from continuing operations of $1.663 billion, an increase of 3.9% over the prior year period, and an increase of 6.8% on a constant currency basis. Net earnings from continuing operations for the first quarter were $73.0 million, or $337.4 million on an adjusted1 basis.
Diluted earnings per share from continuing operations were $0.35 for the first quarter, and adjusted diluted earnings per share from continuing operations were $1.61.
“We are encouraged by the better than expected results seen in Q1, driven by COVID recovery and continued execution by the Zimmer Biomet team. This performance increases our confidence level for 2022 and we are raising and tightening our guidance accordingly,” said Bryan Hanson, Chairman, President and CEO of Zimmer Biomet. “Our underlying business remains strong, fueled by innovation in our portfolio and an acceleration of our transformation activities. I continue to be proud of how the Zimmer Biomet team is executing against our mission so that we can serve healthcare providers and their patients while delivering value for shareholders.”
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1 Reconciliations of these measures to the corresponding U.S. generally accepted accounting principles measures |
Recent Highlights
Aligned with the ongoing transformation of Zimmer Biomet’s business, key first quarter highlights include:
- Successful completion of the spinoff of ZimVie, Zimmer Biomet’s former spine and dental businesses, on March 1, 2022.
- Launch of WalkAI, a suite of integrated smart, digital and robotic technologies purposefully engineered to deliver transformative data-powered clinical insights with the goal of improving patient outcomes.
- Receipt of key recognition and awards including: earning a 100 percent rating on the 2022 Human Rights Campaign (HRC) Foundation’s Corporate Equality Index, a globally recognized, national benchmarking survey on corporate policies, practices and benefits pertinent to LGBTQ+ workplace equity; ranking among the top 500 companies on Forbes’ list of America’s Best Large Employers for 2022; and inclusion in Fast Company’s list of Most Innovative Robotics Companies in 2022 for ROSA® Robotics, a multi-application platform that utilizes Zimmer Biomet’s leading implants and data technologies to redefine robotics by providing real-time insights to optimize patient outcomes.
ZimVie Spinoff Transaction
The Company completed the spinoff of ZimVie Inc. (ZimVie) on March 1, 2022. The historical results of the spine and dental businesses that were contributed to ZimVie in the spinoff are excluded from net sales and expenses and reflected as discontinued operations in the Company’s Condensed Consolidated Statements of Earnings for the periods presented in this release. The financial information presented in this release reflects the Company’s results on a continuing operations basis, and prior periods have been recast to conform to this presentation.
Geographic and Product Category Sales
In the three-month period ended March 31, 2022, the Company updated its geographic sales reporting. Geographic results now are presented by a United States geography and an International geography. Previously, net sales were reported by three geographies: Americas, EMEA, and Asia Pacific.
Prior period net sales have been reclassified to the current presentation, including reclassification of net sales related to the spine and dental businesses to discontinued operations.
Please see the attached schedules accompanying this press release for additional details on performance in the quarter, including net sales by Zimmer Biomet’s two geographies and four product categories.
The following sales table provides results by geography and product category for the three-month period ended March 31, 2022, as well as the percentage change compared to the prior year period, on both a reported basis and a constant currency basis.
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NET SALES – THREE MONTHS ENDED MARCH 31, 2022 |
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(in millions, unaudited) |
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Constant |
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Net |
Currency |
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Sales |
% Change |
% Change |
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Geographic Results |
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United States |
$ |
941.2 |
5.8 |
% |
5.8 |
% |
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International |
722.0 |
1.4 |
8.1 |
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Total |
$ |
1,663.2 |
3.9 |
% |
6.8 |
% |
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Product Categories |
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Knees |
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United States |
$ |
379.5 |
11.7 |
% |
11.7 |
% |
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International |
283.3 |
3.1 |
10.1 |
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Total |
662.8 |
7.9 |
11.0 |
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Hips |
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United States |
224.6 |
3.3 |
3.3 |
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International |
226.4 |
(1.4) |
5.6 |
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Total |
451.0 |
0.9 |
4.5 |
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S.E.T. * |
416.8 |
(0.2) |
1.8 |
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Other |
132.6 |
8.2 |
11.5 |
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Total |
$ |
1,663.2 |
3.9 |
% |
6.8 |
% |
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* Sports Medicine, Extremities, Trauma, Craniomaxillofacial and Thoracic |
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Financial Guidance
The Company is updating its full-year 2022 financial guidance to raise and tighten its previous projected ranges for revenue growth, foreign currency exchange impact and adjusted diluted EPS from continuing operations:
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Projected Year Ending December 31, 2022 |
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Previous |
Updated |
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2022 Reported Revenue Change |
(4.0)% – 0.0% |
(1.5)% – 0.5% |
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Foreign Currency Exchange Impact |
(2.0)% |
(3.5)% |
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Adjusted Operating Profit Margin(1) |
26.5% – 27.5% |
26.5% – 27.5% |
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Adjusted Tax Rate(1) |
16.0% – 16.5% |
16.0% – 16.5% |
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Adjusted Diluted EPS from Continuing Operations(1) |
$6.40 – $6.80 |
$6.65 – $6.85 |
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(1) These measures are non-GAAP financial measures for which a reconciliation to the most directly comparable |
Conference Call
The Company will conduct its first quarter investor conference call today, May 3, 2022, at 8:30 a.m. ET. The audio webcast can be accessed via Zimmer Biomet’s Investor Relations website at https://investor.zimmerbiomet.com. It will be archived for replay following the conference call.
