Patterson Cos. on Wednesday reported stronger-than-expected second-quarter results as dental offices continued to reopen after spring restrictions because of the coronavirus pandemic.
Net sales increased to $1.55 billion, a 9.5% increase over the same period a year ago.
The Mendota Heights-based company is a distributor of products and supplies to dental and animal health markets that had been severely depressed by COVID-19 restrictions earlier this year.
The company does not believe that dental and veterinary offices will continue to see mandated shutdowns.
Company officials also said dental and veterinary offices can continue to operate comparatively safely.
"We're hearing from our customers that their patients are comfortable visiting their dental practices again with the enhanced infection control procedures, screening protocols and safe patient communication tools our customers have implemented," CEO Mark Walchirk told analysts on its earnings conference call.
Walchirk said the company believes there has been a permanent shift in expectations on infection control during dental visits. While he expects the demand for infection control products to moderate in the short term, those products will be needed in the future well above pre-pandemic levels.
Company earnings increased to $54.1 million, or 56 cents per share, after it had reported a net loss of $33.1 million, or 35 cents per shares in their fiscal second quarter last year.
Adjusted earnings per share were 63 cents, a 62% increase from the year ago quarter and better than 38 cents per share analysts were expecting. Sales also exceeded analyst expectations of $1.4 billion.
During Patterson's second fiscal quarter, ended Oct. 24, sales in its dental segment rose 12% to $632 million on strong sales of consumables that include infection control products.
Growth in sales for supplies not categorized as infection control grew 6% in the quarter.
The company's larger animal health segment, which includes both companion and production animal markets, saw its internal sales grow 7% to $914.2 million in the quarter.
The veterinary segment did see some increases due to higher pet-adoption rates and more focus on pets during the pandemic.
Walchirk told analysts the company expects pet-ownership rates, which have increased over their last two quarters, probably won't continue at current rates but that the animal-companion market will also continue to grow faster than pre-pandemic levels.
Shares of Patterson closed at $31.94 per share, up 15.3%, on Wednesday. Over the last 52 weeks, shares have traded between $12.93 and $32.47 per share.
Patrick Kennedy • 612-673-7926