Patterson Companies reported flat sales in its dental segment for the second fiscal quarter of 2017.
For the quarter (end-October 29), the publicly traded company announced an overall 2.1% increase in sales to $1.4 billion.
However, net sales in the company's dental segment (43% of the company) were $601.6 million for the quarter, compared with $601.3 million in the same quarter of 2016. Sales of consumable dental supplies decreased by 2.5%, while dental equipment sales increased 4.2%, according to the company.
For the second quarter, the company reported net income from continuing operations of $45.8 million, compared with $42.6 million in net income in the same quarter of the previous year.
The company also announced it would not "extend exclusivity with Sirona for its entire portfolio beyond September 2017." The decision not to extend the agreement with Dentsply Sirona "in no way" changed the company's commitment to that partnership, according to Scott Anderson, chairman, president, and CEO of Patterson Companies.
However, this decision not to extend sales exclusivity for the full Sirona portfolio of products will mean Patterson will record a pretax noncash impairment charge of approximately $36 million for the third quarter of 2017, related to the distribution fee associated with the Cerec product component. This decision will "negatively affect near-term operations," Patterson said.
Anderson noted that the company had made a "strategic decision" earlier in fiscal 2017 to "realign" its dental sales force with the aim of longer-term company growth.
