STERIS plc announced financial results for its fiscal 2021 second quarter ended September 30, 2020. Revenue as reported for the quarter increased 3% to $756.1 million compared with $736.8 million in the second quarter of fiscal 2020, with growth in Life Sciences and Applied Sterilization Technologies somewhat offset by a decline in Healthcare. Constant currency organic revenue (see Non-GAAP Financial Measures) increased 2% for the second quarter of fiscal 2021.
“Our second quarter results demonstrate the resilience of our business and the good work by STERIS Associates,” said Walt Rosebrough, President and Chief Executive Officer of STERIS. “Our revenue growth reflects the improvement in procedure volumes during the quarter as well as continued strength in segments with exposure to COVID-19 related products and services. Although our first half performance has exceeded our expectations, due to the continued uncertainty surrounding COVID-19, we are not providing guidance at this time.”
As reported net income for the second quarter increased to $105.9 million or $1.23 per diluted share, compared with $94.8 million, or $1.11 per diluted share in the second quarter of fiscal 2020. Adjusted net income (see Non-GAAP Financial Measures) for the second quarter of fiscal 2021 increased to $127.3 million, or $1.48 per diluted share, compared with the previous year’s second quarter of $113.1 million or $1.32 per diluted share.
Second Quarter Segment Results
Healthcare revenue as reported declined 3% in the quarter to $470.9 million compared with $485.3 million in the second quarter of fiscal 2020. This performance reflected a 6% increase in consumable revenue and flat service revenue offset by a 14% decline in capital equipment revenue. Constant currency organic revenue also declined 3% during the quarter. Healthcare operating income was $104.8 million compared with $103.0 million in last year’s second quarter. The increase in profitability was primarily due to lower operating expenses due to business disruption from COVID-19.
Fiscal 2021 second quarter revenue for Applied Sterilization Technologies increased 11% as reported to $169.5 million compared with $152.9 million in the same period last year. Constant currency organic revenue increased 9%, driven primarily by increased demand from medical device Customers as procedure volumes rebounded in the quarter. Segment operating income was $76.8 million in the second quarter of fiscal 2021 compared with operating income of $65.4 million in the same period last year primarily due to the increased volume and lower travel expenses.
Life Sciences second quarter revenue as reported grew 17% to $115.7 million compared with $98.7 million in the second quarter of fiscal 2020, driven by 31% growth in consumable revenue, 10% growth in capital equipment revenue and 3% growth in service revenue. Constant currency organic revenue grew 16% in the quarter. Operating income was $46.4 million compared with $32.3 million in the prior year’s second quarter, primarily driven by increased volume and revenue mix.
Cash Flow
Net cash provided by operations for the first six months of fiscal 2021 was $296.1 million, compared with $260.0 million in fiscal 2020. Free cash flow (see Non-GAAP Financial Measures) for the first six months of fiscal 2021 was $185.6 million compared with $162.0 million in the prior year period. The increase in free cash flow is primarily due to increases in net income and working capital improvements.
Dividend Announcement
STERIS’s Board of Directors has approved a quarterly interim dividend of $0.40 per share. The dividend is payable December 18, 2020 to shareholders of record at the close of business on November 24, 2020.
Conference Call
As previously announced, STERIS management will host a conference call tomorrow, November 3, 2020 at 10:00 a.m. ET. The conference call can be heard at www.steris-ir.com or via phone by dialing 1-833-535-2199 in the United States or 1-412-902-6776 internationally, then asking to join the conference call for STERIS plc.
For those unable to listen to the conference call live, a replay will be available beginning at 12:00 p.m. ET on November 3, 2020, either at www.steris-ir.com or via phone. To access the replay of the call, please use the access code 10148162 and dial 1-877-344-7529 in the United States or 1-412-317-0088 internationally.
About STERIS
STERIS’s MISSION IS TO HELP OUR CUSTOMERS CREATE A HEALTHIER AND SAFER WORLD by providing innovative healthcare and life science product and service solutions around the globe. For more information, visit www.steris.com.
Investor Contact:
Julie Winter, Vice President, Investor Relations and Corporate Communications
Julie_Winter@steris.com
+1 440 392 7245
Media Contact:
Stephen Norton, Senior Director, Corporate Communications
Stephen_Norton@steris.com
+1 440 392 7482