Henry Schein (HSIC) Q3 2024 earnings summary

Executive summary

• Third quarter 2024 net sales were $3.2 billion, up 0.4% year-over-year, driven by acquisitions, high-margin products, and ongoing market share recovery post-cyber incident.

• Net income for Q3 2024 was $99 million, down from $137 million in Q3 2023; non-GAAP EPS was $1.22, including a $0.11 remeasurement gain.

• Operating cash flow for Q3 was $151 million; year-to-date operating cash flow rose to $644 million, up $112 million year-over-year.

• The company increased its 2024 non-GAAP EPS guidance to $4.74–$4.82, reflecting confidence in ongoing performance and continued share repurchases.

• Restructuring initiatives and acquisitions contributed to exceeding financial expectations, with combined restructuring charges of $73 million for the nine months.

Financial highlights

• Q3 2024 global sales were $3.2 billion, up 0.4% year-over-year; year-to-date net sales reached $9.5 billion, up 1.7%.

• GAAP net income for Q3 was $99 million ($0.78 per diluted share), down from $137 million ($1.05) YoY; non-GAAP net income was $155 million ($1.22), down from $173 million ($1.32) YoY.

• Adjusted EBITDA for Q3 2024 was $268 million, compared to $278 million in Q3 2023.

• Gross profit for Q3 2024 was $993 million (31.3% margin); operating income was $157 million, down from $200 million in Q3 2023.

• Cash flow from operations for the nine months was $644 million, up from $532 million in 2023; cash and equivalents at quarter-end were $126 million.

Outlook and guidance

• 2024 total sales growth expected at 4%–5% over 2023, slightly narrowed from prior guidance.

• Non-GAAP diluted EPS guidance raised to $4.74–$4.82, reflecting 5%–7% growth over 2023.

• Adjusted EBITDA expected to grow in low double digits versus 2023.

• Additional restructuring charges related to the 2024 Plan are expected in Q4 2024 and 2025.

• Management believes current liquidity, cash flow, and access to credit are sufficient to meet foreseeable capital needs.