- Third quarter reported net sales decreased 2.7 percent
year-over-year to $1.57 billion, and internal sales decreased 2.4
percent.
- Delivered third quarter GAAP earnings of $0.35 per diluted
share and adjusted earnings1 of $0.43 per diluted share; both GAAP
and adjusted earnings1 were negatively impacted by the
cybersecurity attack on Change Healthcare compared to the prior
year.
- Returned $119.2 million to shareholders in the form of cash
dividends and share repurchases through the first nine months of
fiscal 2025.
Patterson Companies, Inc. (Nasdaq: PDCO) today reported
operating results for its fiscal 2025 third quarter ended January
25, 2025.
“As we continue to progress toward closing our transaction with
Patient Square Capital, our team remains focused on executing our
strategy,” said Don Zurbay, President and CEO of Patterson
Companies. “While our third quarter results were impacted by
challenging market conditions, we remain confident in the long-term
strength of Patterson’s value proposition as an indispensable
partner to customers across the durable and attractive dental and
animal health end markets.”
Pending Transaction
As announced on December 11, 2024, Patterson entered into a
definitive agreement under which Patient Square Capital, a
dedicated health care investment firm, has agreed to acquire
Patterson for $31.35 per share in an all-cash transaction valued at
approximately $4.1 billion, including the refinancing of
Patterson’s receivables facilities. The transaction is expected to
close in April 2025, subject to the satisfaction of customary
closing conditions, including approval by Patterson’s shareholders.
Upon completion of the transaction, Patterson will become a
privately held company, and its common stock will no longer be
traded on the NASDAQ Global Select Market (Nasdaq).
Third Quarter Fiscal 2025 Results
Consolidated net sales were $1.57 billion (see attached Sales
Summary for further details), a decrease of 2.7 percent compared to
the same period last year. Internal sales, which are adjusted for
the effects of currency translation, the net impact of an interest
rate swap and contributions from recent acquisitions, decreased 2.4
percent over the prior year period.
Reported net income attributable to Patterson Companies, Inc.
for the third quarter of fiscal 2025 was $31.3 million, or $0.35
per diluted share, compared to $47.7 million, or $0.52 per diluted
share, in the third quarter of fiscal 2024. Adjusted net income1
attributable to Patterson Companies, Inc., which excludes deal
amortization, totaled $38.7 million for the third quarter of fiscal
2025, or $0.43 per diluted share, compared to $55.0 million, or
$0.59 per diluted share, in the third quarter of fiscal 2024.
Reported and adjusted net income attributable to Patterson
Companies, Inc. was negatively impacted in the fiscal third quarter
by a pre-tax year-over-year increase in LIFO expense of $7.4
million, a $2.4 million pre-tax year-over-year increase in legal
expenses and a $4.0 million pre-tax increase in employee benefit
expense due to medical claims compared to the prior year period. In
addition, the year-over-year decrease in reported and adjusted net
income attributable to Patterson Companies, Inc. in the third
quarter of fiscal 2025 was also related to lower sales of dental
consumables and equipment and the continued negative impact of the
widely reported cybersecurity attack on vendor Change Healthcare,
within the value-added services category of the dental segment.
Patterson Dental
Reported net sales in the Dental segment for the third quarter
of fiscal 2025 were $596.3 million. Internal sales decreased 6.0
percent compared to the fiscal 2024 third quarter. Internal sales
of consumables decreased 6.2 percent year-over-year. Compared to
the prior year period, internal sales of equipment decreased 6.9
percent. Internal sales of value-added services decreased 2.4
percent compared to the prior year period, primarily due to the
negative impact of the cybersecurity attack on Change
Healthcare.
Patterson Animal Health
Reported net sales in the Animal Health segment for the third
quarter of fiscal 2025 were $972.4 million. Internal sales
increased 0.2 percent compared to the fiscal 2024 third quarter.
Compared to the prior year period, internal sales of consumables
were flat, equipment decreased 1.1 percent and value-added services
increased 10.8 percent.
Balance Sheet and Capital Allocation
During the first nine months of fiscal 2025, Patterson Companies
used $735.1 million of cash from operating activities and collected
deferred purchase price receivables of $731.1 million, using $3.9
million in cash, compared to generating $50.5 million during the
first nine months of fiscal 2024. Free cash flow1 (see definition
below and attached free cash flow table) during the first nine
months of fiscal 2025 declined by $49.6 million compared to the
first nine months of fiscal 2024.
In the third quarter of fiscal 2025, Patterson Companies paid a
quarterly cash dividend of $0.26 per share, returning $22.9 million
to shareholders. During the first nine months of fiscal 2025,
Patterson Companies returned $119.2 million to shareholders in the
form of cash dividends and share repurchases.
Year-to-Date Results
Consolidated reported net sales for the first nine months of
fiscal 2025 totaled $4.79 billion, a 1.2 percent year-over-year
decrease. Internal sales for the first nine months of fiscal 2025,
which are adjusted for the effects of currency translation and the
net impact of an interest rate swap and contributions from recent
acquisitions, decreased 1.5 percent year-over-year. Through the
first nine months of fiscal 2025, Dental segment internal sales
decreased 3.8 percent, including a 2.5 percent decrease in
consumables, a 6.0 percent decline in equipment and a 4.0 percent
decrease in value-added services. Through the first nine months of
fiscal 2025, Animal Health segment internal sales decreased 0.2
percent, including 0.5 percent decrease in consumables, a 1.1
percent decline in equipment and a 12.2 percent increase in
value-added services.
Reported net income attributable to Patterson Companies, Inc.
was $71.7 million, or $0.81 per diluted share, compared to $118.9
million, or $1.26 per diluted share in last year's period. Adjusted
net income1 attributable to Patterson Companies, Inc., which
excludes deal amortization, integration and business restructuring
expenses, an inventory pre-payment write-off and a gain on the sale
of an investment totaled $101.6 million, or $1.14 per diluted
share, compared to $140.9 million, or $1.49 per diluted share, in
the year-ago period.
Financial Guidance and Conference Call
In light of the Company’s previously announced agreement to be
acquired by Patient Square Capital, Patterson will not be providing
an update to forward-looking earnings guidance and will not conduct
a quarterly earnings call nor publish supplemental earnings
materials with the financial community that discusses fiscal 2025
third quarter results.
1Non-GAAP Financial Measures
The term “internal sales” used in this release represents net
sales adjusted for the effects of currency translation, the net
impact of an interest rate swap and contributions from recent
acquisitions. Foreign currency impact represents the difference in
results that is attributable to fluctuations in currency exchange
rates the company uses to convert results for all foreign entities
where the functional currency is not the U.S. dollar. The company
calculates the impact as the difference between the current period
results translated using the current period currency exchange rates
and using the comparable prior period’s currency exchange rates.
The company believes the disclosure of net sales excluding the
impact of foreign currency and an interest rate swap provides
useful supplementary information to investors in light of
fluctuations in these variables that are independent of our
period-over-period performance.
The term “free cash flow” used in this release is defined as net
cash used in operating activities less capital expenditures plus
the collection of deferred purchase price receivables.
The Reconciliation of GAAP to non-GAAP Measures table appearing
behind the accompanying financial information is provided to adjust
reported GAAP measures, namely net sales, gross profit, operating
expenses, operating income, other income (expense), net, income
before taxes, income tax expense, net income, net loss attributable
to noncontrolling interests, net income attributable to Patterson
Companies, Inc., and diluted earnings per share attributable to
Patterson Companies, Inc. for the impact of deal amortization,
integration and business restructuring expenses, an interest rate
swap, an inventory pre-payment write-off, and a gain on the sale of
an investment along with any related tax effects of these
items.
- Deal amortization represents non-cash intangible amortization
expense, primarily related to the acquisition of Animal Health
International.
- Integration and business restructuring expenses represent
restructuring charges to better align our organization to current
market opportunities.
- Interest rate swap -- Our customer financing net sales includes
the impact of changes in interest rates on deferred purchase price
receivables, as the average interest rate in our contract portfolio
may not fluctuate at the same rate as interest rate markets,
resulting in an increase or reduction of gain on contract sales. We
enter into an interest rate swap to hedge a portion of the related
interest rate risk. These agreements do not qualify for hedge
accounting, and the gains or losses on an interest rate swap are
reported in other income and expense in our condensed consolidated
statements of operation and other comprehensive income. We present
a non-GAAP adjustment to reclassify the mark-to-market adjustment
on the interest rate swap from other income (expense) to net sales
to align the swap impact with the impact on customer financing net
sales. We believe adjusted net sales, adjusted gross profit and
adjusted operating income, which include the gains and losses on
the interest rate swap, provide additional comparability from
period to period because they present the impact of interest rate
fluctuations, net of the mark-to-market swap adjustment, within
adjusted net sales. We note the net impact of interest rate
fluctuations has a minimal impact on net income.
- Inventory pre-payment write-off represents the write-off of the
remaining balance of a transaction initiated during the COVID-19
pandemic. The inventory prepayment was made in a period of supply
chain disruptions and increased demand for PPE and does not
represent our normal process for purchasing inventory. The
remaining balance of the prepayment was determined to be
uncollectible in the second quarter of fiscal 2025.
- Gain on investment relates to the sale of our investment in
VetSource.
Management believes that these non-GAAP measures may provide a
helpful representation of the company’s performance and enable
comparison of financial results between periods where certain items
may vary independent of business performance. These non-GAAP
financial measures are presented solely for informational and
comparative purposes and should not be regarded as a replacement
for corresponding, similarly captioned, GAAP measures.
About Patterson Companies Inc.
Patterson Companies Inc. (Nasdaq: PDCO) connects dental and
animal health customers in North America and the U.K. to the latest
products, technologies, services and innovative business solutions
that enable operational and professional success. Our comprehensive
portfolio, distribution network and supply chain is equaled only by
our dedicated, knowledgeable people who deliver unrivalled
expertise and unmatched customer service and support.
Learn more: pattersoncompanies.com
Forward-Looking Statements
This press release contains statements that are forward-looking
statements within the meaning of the federal securities laws.
Forward-looking statements include information concerning the
proposed merger and the ability to consummate the proposed merger,
our liquidity and our possible or assumed future results of
operations, including descriptions of our business strategies.
These statements often include words such as “believe,” “expect,”
“project,” “potential,” “anticipate,” “intend,” “plan,” “estimate,”
“seek,” “will,” “may,” “would,” “should,” “could,” “forecasts” or
similar words
These statements are based on certain assumptions that we have
made in light of our experience in the industry as well as our
perceptions of historical trends, current conditions, expected
future developments and other factors we believe are appropriate in
these circumstances. We believe these assumptions are reasonable,
but you should understand that these statements are not guarantees
of performance or results, and our actual results could differ
materially from those expressed in the forward-looking statements
due to a variety of important factors, both positive and negative,
that may be revised or supplemented in subsequent releases or
reports.
These statements involve risks, estimates, assumptions, and
uncertainties that could cause actual results to differ materially
from those expressed in these statements and elsewhere in this
release. These uncertainties include, but are not limited to, the
inability to consummate the merger within the anticipated time
period, or at all, due to any reason, including the failure to
obtain required regulatory and shareholder approvals, satisfy the
other conditions to the consummation of the merger or complete
necessary financing arrangements; the risk that the merger disrupts
our current plans and operations or diverts management’s attention
from its ongoing business; the effects of the merger on our
business, operating results, and ability to retain and hire key
personnel and maintain relationships with customers, suppliers and
others with whom we do business; the risk that our stock price may
decline significantly if the merger is not consummated; the nature,
cost and outcome of any legal proceedings related to the merger;
our dependence on suppliers to manufacture and supply substantially
all of the products we sell; potential disruption of distribution
capabilities, including service issues with third-party shippers;
our dependence on relationships with sales representatives and
service technicians to retain customers and develop business; risks
of selling private label products, including the risk of adversely
affecting our relationships with suppliers; adverse changes in
supplier rebates or other purchasing incentives; the risk of
technological and market obsolescence for the products we sell; the
risk of failing to innovate and develop new and enhanced software
and e-services products; our dependence on positive perceptions of
Patterson’s reputation; risks associated with illicit human use of
pharmaceutical products we distribute; risks inherent in acquiring
and disposing of assets or other businesses and risks inherent in
integrating acquired businesses; turnover or loss of key personnel
or highly skilled employees; risks associated with information
systems, software products and cyber-security attacks; risks
inherent in our growing use of artificial intelligence systems to
automate processes and analyze data; adverse impacts of wide-spread
public health concerns as we experienced with the COVID-19 pandemic
and may experience in the future; risks related to climate change;
our ability to comply with restrictive covenants and other limits
in our credit agreement; the risk that our governing documents and
Minnesota law may discourage takeovers and business combinations;
the effects of the highly competitive dental and animal health
supply markets in which we compete; the effects of consolidation
within the dental and animal health supply markets; risks from the
formation or expansion of GPOs, provider networks and buying groups
that may place us at a competitive disadvantage; exposure to the
risks of the animal production business, including changing
consumer demand, the cyclical livestock market, weather conditions,
the availability of natural resources and other factors outside our
control, and the risks of the companion animal business, including
the possibility of disease adversely affecting the pet population;
exposure to the risks of the health care industry, including
changes in demand due to political, economic and regulatory
influences and other factors outside our control; increases in
over-the-counter sales and e-commerce options; risks of litigation
and government inquiries and investigations, including the
diversion of management’s attention, the cost of defending against
such actions, the possibility of damage awards or settlements,
fines or penalties, or equitable remedies (including but not
limited to the revocation of or non-renewal of licenses) and
inherent uncertainty; failure to comply with health care fraud or
other laws and regulations; change and uncertainty in the health
care industry; failure to comply with existing or future U.S. or
foreign laws and regulations including those governing the
distribution of pharmaceuticals and controlled substances; failure
to comply with evolving data privacy laws and regulations; tax
legislation; risks inherent in international operations, including
currency fluctuations; and uncertain macro-economic conditions,
including inflationary pressures.
The foregoing review of important factors that could cause
actual results to differ from expectations should not be construed
as exhaustive and should be read in conjunction with the
information contained or incorporated by reference in our Annual
Report on Form 10-K for the year ended April 27, 2024 filed with
the SEC on June 18, 2024 and our definitive proxy statement for our
2024 annual meeting of shareholders filed with the SEC on August 2,
2024 and our recent Quarterly Reports on Form 10-Q and Current
Reports on Form 8-K.
The information contained in this release is made only as of the
date hereof, even if subsequently made available on our website or
otherwise.
PATTERSON COMPANIES,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(In thousands, except per
share amounts)
(Unaudited)
Three Months Ended
Nine Months Ended
January 25, 2025
January 27, 2024
January 25, 2025
January 27, 2024
Net sales
$
1,572,411
$
1,616,095
$
4,788,528
$
4,845,612
Gross profit
320,824
351,006
961,525
1,009,087
Operating expenses
275,383
280,994
849,079
843,950
Operating income
45,441
70,012
112,446
165,137
Other income (expense):
Other income, net
8,147
3,653
19,566
22,650
Interest expense
(10,753
)
(11,725
)
(35,774
)
(31,879
)
Income before taxes
42,835
61,940
96,238
155,908
Income tax expense
11,665
14,347
24,733
37,330
Net income
31,170
47,593
71,505
118,578
Net loss attributable to noncontrolling
interests
(85
)
(110
)
(234
)
(317
)
Net income attributable to Patterson
Companies, Inc.
$
31,255
$
47,703
$
71,739
$
118,895
Earnings per share attributable to
Patterson Companies, Inc.:
Basic
$
0.35
$
0.52
$
0.81
$
1.26
Diluted
$
0.35
$
0.52
$
0.81
$
1.26
Weighted average shares:
Basic
88,306
92,009
88,197
94,088
Diluted
89,070
92,519
88,871
94,704
Dividends declared per common share
$
—
$
0.26
$
0.52
$
0.78
PATTERSON COMPANIES,
INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands)
(Unaudited)
January 25, 2025
April 27, 2024
ASSETS
Current assets:
Cash and cash equivalents
$
134,996
$
114,462
Receivables, net
469,924
547,287
Inventory, net
889,348
782,898
Prepaid expenses and other current
assets
343,366
334,116
Total current assets
1,837,634
1,778,763
Property and equipment, net
227,802
229,081
Operating lease right-of-use assets,
net
121,613
122,295
Goodwill and identifiable intangibles,
net
330,145
349,589
Investments
88,649
166,320
Long-term receivables, net and other
226,743
250,684
Total assets
$
2,832,586
$
2,896,732
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable
$
644,861
$
745,375
Other accrued liabilities
204,740
245,610
Operating lease liabilities
26,945
32,815
Current maturities of long-term debt
126,875
122,750
Borrowings on revolving credit
302,000
186,000
Total current liabilities
1,305,421
1,332,550
Long-term debt
321,763
328,911
Non-current operating lease
liabilities
98,053
92,464
Other non-current liabilities
117,434
141,075
Total liabilities
1,842,671
1,895,000
Stockholders' equity
989,915
1,001,732
Total liabilities and stockholders'
equity
$
2,832,586
$
2,896,732
PATTERSON COMPANIES,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Nine Months Ended
January 25, 2025
January 27, 2024
Operating activities:
Net income
$
71,505
$
118,578
Adjustments to reconcile net income to net
cash used in operating activities:
Depreciation and amortization
68,784
65,198
Stock-based compensation
16,568
15,395
Non-cash (gains) losses and other, net
(9,695
)
4,120
Change in assets and liabilities:
Receivables
(615,136
)
(744,275
)
Inventory
(107,461
)
(106,328
)
Accounts payable
(101,856
)
(43,533
)
Accrued liabilities
(16,348
)
(14,510
)
Other changes from operating activities,
net
(41,429
)
(14,494
)
Net cash used in operating activities
(735,068
)
(719,849
)
Investing activities:
Additions to property and equipment and
software
(46,427
)
(51,196
)
Collection of deferred purchase price
receivables
731,146
770,319
Payments related to acquisitions, net of
cash acquired
(11,967
)
(1,108
)
Sale of investment
86,408
—
Net cash provided by investing
activities
759,160
718,015
Financing activities:
Dividends paid
(69,165
)
(75,021
)
Repurchases of common stock
(50,000
)
(214,587
)
Payments on long-term debt
(3,375
)
(35,250
)
Draw on revolving credit
116,000
286,000
Other financing activities
3,505
4,767
Net cash used in financing activities
(3,035
)
(34,091
)
Effect of exchange rate changes on
cash
(523
)
254
Net change in cash and cash
equivalents
20,534
(35,671
)
Cash and cash equivalents at beginning of
period
114,462
159,669
Cash and cash equivalents at end of
period
$
134,996
$
123,998
PATTERSON COMPANIES,
INC.
SALES SUMMARY
(Dollars in thousands)
(Unaudited)
January 25, 2025
January 27, 2024
Total Sales
Growth
Foreign Exchange
Impact
Net Interest Rate Swap
Acquisition Impact
Internal Sales
Growth
Three Months Ended
Consolidated net sales
Consumable
$
1,242,015
$
1,262,290
(1.6
)%
(0.2
)%
—
%
0.3
%
(1.7
)%
Equipment
229,432
245,262
(6.5
)
(0.4
)
—
—
(6.1
)
Value-added services and other
100,964
108,543
(7.0
)
(0.1
)
(5.3
)
—
(1.6
)
Total
$
1,572,411
$
1,616,095
(2.7
)%
(0.2
)%
(0.3
)%
0.2
%
(2.4
)%
Dental
Consumable
$
327,637
$
350,953
(6.6
)%
(0.4
)%
—
%
—
%
(6.2
)%
Equipment
195,897
211,352
(7.3
)
(0.4
)
—
—
(6.9
)
Value-added services and other
72,794
74,832
(2.7
)
(0.3
)
—
—
(2.4
)
Total
$
596,328
$
637,137
(6.4
)%
(0.4
)%
—
%
—
%
(6.0
)%
Animal Health
Consumable
$
914,378
$
911,337
0.3
%
(0.1
)%
—
%
0.4
%
—
%
Equipment
33,535
33,910
(1.1
)
—
—
—
(1.1
)
Value-added services and other
24,467
22,030
11.1
0.2
—
0.1
10.8
Total
$
972,380
$
967,277
0.5
%
(0.1
)%
—
%
0.4
%
0.2
%
Corporate
Value-added services and other
$
3,703
$
11,681
n/m
—
%
n/m
—
%
(26.9
)%
Total
$
3,703
$
11,681
n/m
—
%
n/m
—
%
(26.9
)%
PATTERSON COMPANIES,
INC.
SALES SUMMARY
(Dollars in thousands)
(Unaudited)
January 25, 2025
January 27, 2024
Total Sales
Growth
Foreign Exchange
Impact
Net Interest Rate Swap
Acquisition Impact
Internal Sales
Growth
Nine Months Ended
Consolidated net sales
Consumable
$
3,867,636
$
3,897,378
(0.8
)%
0.1
%
—
%
0.1
%
(1.0
)%
Equipment
604,453
639,526
(5.5
)
(0.2
)
—
—
(5.3
)
Value-added services and other
316,439
308,708
2.5
0.1
2.6
—
(0.2
)
Total
$
4,788,528
$
4,845,612
(1.2
)%
0.1
%
0.1
%
0.1
%
(1.5
)%
Dental
Consumable
$
1,020,662
$
1,049,492
(2.7
)%
(0.2
)%
—
%
—
%
(2.5
)%
Equipment
514,908
549,028
(6.2
)
(0.2
)
—
—
(6.0
)
Value-added services and other
222,797
232,298
(4.1
)
(0.1
)
—
—
(4.0
)
Total
$
1,758,367
$
1,830,818
(4.0
)%
(0.2
)%
—
%
—
%
(3.8
)%
Animal Health
Consumable
$
2,846,974
$
2,847,886
—
%
0.3
%
—
%
0.2
%
(0.5
)%
Equipment
89,545
90,498
(1.1
)
—
—
—
(1.1
)
Value-added services and other
72,862
64,505
13.0
0.8
—
—
12.2
Total
$
3,009,381
$
3,002,889
0.2
%
0.3
%
—
%
0.1
%
(0.2
)%
Corporate
Value-added services and other
$
20,780
$
11,905
n/m
—
%
n/m
—
%
3.4
%
Total
$
20,780
$
11,905
n/m
—
%
n/m
—
%
3.4
%
PATTERSON COMPANIES,
INC.
OPERATING INCOME BY
SEGMENT
(In thousands)
(Unaudited)
Three Months Ended
Nine Months Ended
January 25, 2025
January 27, 2024
January 25, 2025
January 27, 2024
Operating income (loss)
Dental
$
42,079
$
53,630
$
102,797
$
147,577
Animal Health
31,976
32,104
86,964
88,143
Corporate
(28,614
)
(15,722
)
(77,315
)
(70,583
)
Total
$
45,441
$
70,012
$
112,446
$
165,137
PATTERSON COMPANIES,
INC.
RECONCILIATION OF GAAP TO
NON-GAAP MEASURES
(Dollars in thousands, except
per share amounts)
(Unaudited)
For the three months ended January 25,
2025
GAAP
Deal amortization
Integration and business
restructuring expenses
Interest rate swap
Inventory pre- payment
write-off
Gain on investment
Non-GAAP
Net sales
$
1,572,411
$
—
$
—
$
2,298
$
—
$
—
$
1,574,709
Gross profit
320,824
—
—
2,298
—
—
323,122
Operating expenses
275,383
(9,723
)
—
—
—
—
265,660
Operating income
45,441
9,723
—
2,298
—
—
57,462
Other income (expense), net
(2,606
)
—
—
(2,298
)
—
—
(4,904
)
Income before taxes
42,835
9,723
—
—
—
—
52,558
Income tax expense
11,665
2,305
—
—
—
—
13,970
Net income
31,170
7,418
—
—
—
—
38,588
Net loss attributable to noncontrolling
interests
(85
)
—
—
—
—
—
(85
)
Net income attributable to Patterson
Companies, Inc.
$
31,255
$
7,418
$
—
$
—
$
—
$
—
$
38,673
Diluted earnings per share attributable to
Patterson Companies, Inc.*
$
0.35
$
0.08
$
—
$
—
$
—
$
—
$
0.43
Gross margin
20.4
%
20.5
%
Operating margin
2.9
%
3.6
%
Effective tax rate
27.2
%
26.6
%
For the three months ended January 27,
2024
GAAP
Deal amortization
Integration and business
restructuring expenses
Interest rate swap
Inventory pre- payment
write-off
Gain on investment
Non-GAAP
Net sales
$
1,616,095
$
—
$
—
$
(3,474
)
$
—
$
—
$
1,612,621
Gross profit
351,006
—
—
(3,474
)
—
—
347,532
Operating expenses
280,994
(9,630
)
—
—
—
—
271,364
Operating income
70,012
9,630
—
(3,474
)
—
—
76,168
Other income (expense), net
(8,072
)
—
—
3,474
—
—
(4,598
)
Income before taxes
61,940
9,630
—
—
—
—
71,570
Income tax expense
14,347
2,304
—
—
—
—
16,651
Net income
47,593
7,326
—
—
—
—
54,919
Net loss attributable to noncontrolling
interests
(110
)
—
—
—
—
—
(110
)
Net income attributable to Patterson
Companies, Inc.
$
47,703
$
7,326
$
—
$
—
$
—
$
—
$
55,029
Diluted earnings per share attributable to
Patterson Companies, Inc.*
$
0.52
$
0.08
$
—
$
—
$
—
$
—
$
0.59
Gross margin
21.7
%
21.6
%
Operating margin
4.3
%
4.7
%
Effective tax rate
23.2
%
23.3
%
* May not sum due to rounding
PATTERSON COMPANIES,
INC.
RECONCILIATION OF GAAP TO
NON-GAAP MEASURES
(Dollars in thousands, except
per share amounts)
(Unaudited)
For the nine months ended January 25,
2025
GAAP
Deal amortization
Integration and business
restructuring expenses
Interest rate swap
Inventory pre- payment
write-off
Gain on investment
Non-GAAP
Net sales
$
4,788,528
$
—
$
—
$
(2,181
)
$
—
$
—
$
4,786,347
Gross profit
961,525
—
6,947
(2,181
)
—
—
966,291
Operating expenses
849,079
(29,091
)
(3,262
)
—
(3,797
)
—
812,929
Operating income
112,446
29,091
10,209
(2,181
)
3,797
—
153,362
Other income (expense), net
(16,208
)
—
—
2,181
—
(3,803
)
(17,830
)
Income before taxes
96,238
29,091
10,209
—
3,797
(3,803
)
135,532
Income tax expense
24,733
6,914
2,571
—
949
(951
)
34,216
Net income
71,505
22,177
7,638
—
2,848
(2,852
)
101,316
Net loss attributable to noncontrolling
interests
(234
)
—
—
—
—
—
(234
)
Net income attributable to Patterson
Companies, Inc.
$
71,739
$
22,177
$
7,638
$
—
$
2,848
$
(2,852
)
$
101,550
Diluted earnings per share attributable to
Patterson Companies, Inc.*
$
0.81
$
0.25
$
0.09
$
—
$
0.03
$
(0.03
)
$
1.14
Gross margin
20.1
%
20.2
%
Operating margin
2.3
%
3.2
%
Effective tax rate
25.7
%
25.2
%
For the nine months ended January 27,
2024
GAAP
Deal amortization
Integration and business
restructuring expenses
Interest rate swap
Inventory pre- payment
write-off
Gain on investment
Non-GAAP
Net sales
$
4,845,612
$
—
$
—
$
6,087
$
—
$
—
$
4,851,699
Gross profit
1,009,087
—
—
6,087
—
—
1,015,174
Operating expenses
843,950
(28,884
)
—
—
—
—
815,066
Operating income
165,137
28,884
—
6,087
—
—
200,108
Other income (expense), net
(9,229
)
—
—
(6,087
)
—
—
(15,316
)
Income before taxes
155,908
28,884
—
—
—
—
184,792
Income tax expense
37,330
6,913
—
—
—
—
44,243
Net income
118,578
21,971
—
—
—
—
140,549
Net loss attributable to noncontrolling
interests
(317
)
—
—
—
—
—
(317
)
Net income attributable to Patterson
Companies, Inc.
$
118,895
$
21,971
$
—
$
—
$
—
$
—
$
140,866
Diluted earnings per share attributable to
Patterson Companies, Inc.*
$
1.26
$
0.23
$
—
$
—
$
—
$
—
$
1.49
Gross margin
20.8
%
20.9
%
Operating margin
3.4
%
4.1
%
Effective tax rate
23.9
%
23.9
%
* May not sum due to rounding
PATTERSON COMPANIES,
INC.
FREE CASH FLOW
(In thousands)
(Unaudited)
Nine Months Ended
January 25, 2025
January 27, 2024
Net cash used in operating activities
$
(735,068
)
$
(719,849
)
Additions to property and equipment and
software
(46,427
)
(51,196
)
Collection of deferred purchase price
receivables
731,146
770,319
Free cash flow
$
(50,349
)
$
(726
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250226788391/en/
INVESTOR: John M. Wright, Investor Relations TEL:
651.686.1364 EMAIL:
investor.relations@pattersoncompanies.com
MEDIA: Patterson Corporate Communications TEL:
651.905.3349 EMAIL:
corporate.communications@pattersoncompanies.com
WEB: pattersoncompanies.com
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