Patterson Companies revised its fiscal 2024 earnings guidance lower after facing softer market demand, sending shares tumbling on Wednesday.
The company now expects its adjusted earnings per share (EPS) projection to be in the range of $2.35 to $2.45, compared to the previous guidance of $2.45 to $2.55.
Despite the disappointing forecast, Patterson revealed a 1.6% year-over-year increase in consolidated net sales, totaling $1.65 billion, which just missed Zacks Consensus Estimates.
Despite the sales growth, Patterson Companies witnessed a decline in net income attributable to the company, recording $40 million, or $0.42 per diluted share, down from $54.1 million, or $0.55 per diluted share, in the second quarter of fiscal 2023.
Adjusted net income, excluding deal amortization, stood at $47.3 million, or $0.50 per diluted share, in contrast to $61.2 million, or $0.63 per diluted share, in the previous year. The decrease was attributed to lower sales of dental technology equipment and increased operating expenses.
"The macro environment challenges we faced during the second quarter do not change our core objectives or continued conviction in making strategic investments in our distribution capabilities, software offerings, and value-added services,” CEO Don Zurbay told shareholders.
“While we have adjusted our fiscal 2024 guidance to reflect our current expectations for the near term, we remain confident in the enduring strength and resiliency of the Dental and Animal Health end markets.”
Investors reacted by sending Patterson shares sharply lower on Wednesday afternoon. The company’s stock was changing hands at around $26.21, a 16.6% decline.
Patterson Companies is a diversified global provider of products, services, and technology to various industries, with a focus on dental and animal health markets.