Henry Schein, a provider of health care products and services to office-based dental, animal health and medical practitioners, reported financial results for the second quarter of 2016.
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Net sales for the quarter ended June 25, 2016, were $2.9 billion, an increase of 9.3% compared with the second quarter of 2015. This consisted of 9.7% growth in local currencies and a 0.4% decline related to foreign currency exchange.
In local currencies, internally generated sales increased 7.6% and acquisition growth was 2.1% (see Exhibit A for details of sales growth).
Net income attributable to Henry Schein was $120.1 million, or $1.46 per diluted share. This represents growth of 1.8% and 4.3%, respectively, compared with the second quarter of 2015.
Henry Schein's second quarter results include the favorable effect of a proposed tax audit settlement resulting in a reduction in income tax expense of $4.5 million, or approximately $0.05 per diluted share.
Excluding restructuring costs of $20.4 million pretax, or $0.18 per diluted share, adjusted net income attributable to Henry Schein, Inc. for the second quarter of 2016 was $135.4 million, or $1.64 per diluted share.
This represents growth of 9.9% and 12.3%, respectively, compared with the second quarter of 2015, excluding restructuring costs.
Dental sales of $1.4 billion increased 4.0%, consisting of 4.1% growth in local currencies and a 0.1% decline related to foreign currency exchange. In local currencies, internally generated sales increased 2.8% and acquisition growth was 1.3%.
The 2.8% internal growth in local currencies included 2.0% growth in North America and 4.2% growth internationally.
Animal Health sales of $853.6 million increased 14.0%, consisting of 15.2% growth in local currencies and a 1.2% decline related to foreign currency exchange. In local currencies, internally generated sales increased 11.8% and acquisition growth was 3.4%.
The 11.8% internal growth in local currencies included 18.8% growth in North America and 4.9% growth internationally.
Medical sales of $538.8 million increased 14.5%, all internally generated and with no material impact from foreign currency exchange.
Technology and Value-Added Services sales of $107.0 million increased 19.6%, including 20.4% growth in local currencies and a 0.8% decline related to foreign currency exchange. In local currencies, internally generated sales increased 8.1% and acquisition growth was 12.3%.
The Company announced that it repurchased approximately 337,000 shares of its common stock during the second quarter at an average price of $169.41 per share, or approximately $57 million.
The impact of the repurchase of shares on second quarter diluted EPS was immaterial. At the close of the second quarter, Henry Schein had approximately $243 million authorized for future repurchases of its common stock. ■