Owens Minor Inc (OMI) 10-K Annual Report February 2017

RICHMOND, VA…Owens & Minor, Inc. (NYSE-OMI) today reported financial results for the year ended December 31, 2016, including consolidated revenues of $9.72 billion, which declined 0.5% when compared to the prior year. Net income for 2016 improved nearly $5.4 million to $109 million, or $1.76 per diluted share. Adjusted net income (non-GAAP) was $127 million, or $2.05 per diluted share. Continued progress with transformation agenda initiatives, including on-going cost reduction efforts, contributed positively to results, largely offsetting the negative impact of the previously discussed transition of a large customer during the third quarter, as well as continuing margin pressure. A reconciliation of reported results to adjusted (non-GAAP) measures is included below.

Consolidated operating earnings for 2016 were $200 million, or 2.05% of revenues, essentially unchanged when compared to last year’s operating earnings. Adjusted consolidated operating earnings (non-GAAP) for the full year were $224 million, or 2.31% of revenues, representing a decline of 1.3%, when compared to the prior year period.

“We had a solid year in 2016, driven by focused execution and the dedication of our teammates against a backdrop of challenging industry dynamics,” said Cody Phipps, president & chief executive officer of Owens & Minor. “As we have discussed, we will continue to face headwinds throughout 2017. Our focus now is on executing our strategic plan to reposition our company for long-term success.”

Fourth Quarter 2016 Results

For the fourth quarter of 2016, consolidated revenues were $2.37 billion, representing a decline of 4.8%, when compared to revenues in the fourth quarter of 2015. The revenue decline reflects the previously discussed exit of a large West Coast customer during the third quarter. In addition, there was one less selling day in the fourth quarter of 2016 than in the prior year fourth quarter. Quarterly net income was $27.1 million, or $0.45 per diluted share. Adjusted net income (non-GAAP) for the quarter was $31.6 million, or $0.52 per diluted share.

Consolidated operating earnings for the fourth quarter of 2016 declined $8.9 million to $49.0 million, when compared to the same period last year. Adjusted consolidated operating earnings (non-GAAP) for the fourth quarter of 2016 were $53.7 million, a decrease of $9.4 million compared to last year. The quarterly changes resulted from the same factors that affected the annual results.

Asset Management

The balance of cash and cash equivalents was $185 million at December 31, 2016, compared to cash of $161 million at December 31, 2015. For the year, the company reported operating cash flow of $187 million, compared to $270 million in the prior year. The decrease was driven primarily by changes in working capital. Asset management metrics, as of the end of the year, included consolidated days sales outstanding (DSO) of 23.1 compared to 21.0 days for 2015; consolidated inventory turns were 9.2 for 2016, compared to 9.4 for 2015.

Segment Results

For the full year of 2016, Domestic segment revenue increased slightly by 0.2% to $9.19 billion, when compared to the prior year. Fourth quarter Domestic segment revenues were $2.24 billion, representing a decrease of 3.8% from

The following information was filed by Owens Minor Inc (OMI) on Wednesday, February 15, 2017 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Owens Minor Inc's 10-K Annual Report:

Financial - Earnings Highlight
The decrease in gross margin compared to the prior year was largely attributable to lower income from manufacturer product price changes, the previously announced exit of a large domestic customer in September 2016 and the unfavorable impact of foreign currency translation of $11.9 million.

Other - Other Highlight
Critical accounting policies are defined as those policies that relate to estimates that require us to make assumptions about matters that are highly uncertain at the time the estimate is made and could have a material impact on our results due to changes in the estimate or the use of different assumptions that could reasonably have been used.
Financial - Debt Highlight
We believe available financing sources, including cash generated by operating activities and borrowings under the Amended Credit Agreement, will be sufficient to fund our working capital needs, capital expenditures, long-term strategic growth, payments under long-term debt and lease arrangements, payments of quarterly cash dividends, share repurchases and other cash requirements.
Financial - Earnings Highlight
Had inventory been valued under the first-in, first-out FIFO method, gross margin as a percentage of net revenue would have been the same in 2015 and higher by 8 basis points in 2014.
Financial - Expense Highlight
These impacts were largely offset by benefits from cost control initiatives, lower fuel costs compared to prior year and favorable foreign currency translation impacts of $37.6 million, all of which contributed to a 27 basis point reduction in DS&A expenses as a percentage of net revenue compared to 2014.
Financial - Shares
In February 2014, the Board...Read more
Financial - Shares
In October 2016, our Board...Read more
Financial - Earnings
CPS operating earnings of $53.8...Read more
Revenue - Product
We expect revenue and gross...Read more
Revenue - Product
Consolidated net revenue declined in...Read more
Financial - Earnings
The improvement in gross margin...Read more
Financial - Earnings
Had inventory been valued under...Read more
Financial - Expense
The change in DS&A expenses...Read more
Other - Other
An unexpected bankruptcy or other...Read more
Financial - Earnings
Adjusted operating earnings, adjusted net...Read more
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Cash used in financing activities...Read more
Financial - Expense
Results for the year reflected...Read more
Financial - Dividend
In February 2017, the Board...Read more
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The decrease in DS&A expenses...Read more
Financial - Earnings
Cash provided by used for...Read more
Revenue - Product
On a constant currency basis,...Read more
Revenue - Product
Consolidated net revenue improved in...Read more
Financial - Expense
Cost of goods sold includes...Read more
Financial - Expense
Cost of goods sold includes...Read more
Other - Other
We believe our critical accounting...Read more
Financial - Debt
In 2014, cash provided by...Read more
M & A - Other
We used a portion of...Read more
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We expect revenue for 2017...Read more
Revenue - Product
The decline in CPS revenue...Read more
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At December 31, 2016, long-lived...Read more
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Intangible assets with finite useful...Read more
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When determining the fair values...Read more
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The following table provides a...Read more
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In general, the measures exclude...Read more
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Long-lived assets, which are a...Read more
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If the underlying facts and...Read more
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We monitor operating working capital...Read more
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The 2021 Notes were sold...Read more
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The 2024 Notes were sold...Read more
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The non-GAAP financial measures disclosed...Read more
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During 2016, we repurchased approximately...Read more
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Cash used for investing activities...Read more

Financial Statements, Disclosures and Schedules

Inside this 10-K Annual Report

Material Contracts, Statements, Certifications & more

Owens Minor Inc provided additional information to their SEC Filing as exhibits

Exhibit 21.1: Subsidaries Of The Registrant

Exhibit 23.1: Consents Of Experts And Counsel

Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 31.2: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 32.1: Section 1350 Certification

Exhibit 32.2: Section 1350 Certification

Ticker: OMI
CIK: 75252
Form Type: 10-K Annual Report
Accession Number: 0000075252-17-000037
Submitted to the SEC: Fri Feb 17 2017 4:35:27 PM EST
Accepted by the SEC: Fri Feb 17 2017
Period: Saturday, December 31, 2016
Industry: Wholesale Medical Dental And Hospital Equipment And Supplies