Business Segments and Revenue - STERIS operates in three reportable business segments: Healthcare, Applied Sterilization Technologies (AST), and Life Sciences, with the majority of revenues derived from healthcare and medical device customers[11]. - For the year ended March 31, 2025, no customer represented more than 10% of total revenues in any of the segments[17][21][26]. - As of March 31, 2025, the company reported a backlog of $452.9 million, with $369.2 million related to the Healthcare segment and $83.7 million to the Life Sciences segment, indicating an increase from $425.2 million in the previous year[49][50]. - Healthcare segment revenue increased to $12,341 million in fiscal 2025 from $11,419 million in fiscal 2024, representing an increase of 8.1%[78]. - Revenues increased by $320.8 million, or 6.2%, to $5,459.5 million for the year ended March 31, 2025, compared to $5,138.7 million for the year ended March 31, 2024[205]. Research and Development - STERIS invests significantly in research and development to discover and market innovative, cost-effective products and services[45]. - The company has 607 U.S. patents and 2,315 patents in other jurisdictions, with 90 U.S. patent applications and 289 applications pending[31]. Operational Performance and Costs - STERIS experienced a rise in supply chain and labor costs during fiscal 2023 and 2024, which moderated in fiscal 2025[29]. - The company applies Lean principles across its operations to enhance performance, agility, and value[34]. - The average number of employees during fiscal 2025 was approximately 18,000, with less than 11% represented by work councils or labor unions, indicating generally good employee relations[77]. - Total employees rose to 17,787 in fiscal 2025, up from 16,768 in fiscal 2024, reflecting a growth of 6.1%[78]. - Total employee costs increased to $1,850,544 thousand in fiscal 2025 from $1,718,164 thousand in fiscal 2024, marking a rise of 7.7%[86]. - The company maintained zero Class I recalls in fiscal 2025, 2024, or 2023, demonstrating strong compliance with safety standards[89]. Environmental and Sustainability Efforts - The company has made significant investments to comply with environmental laws and regulations, focusing on improving energy and water efficiency and reducing waste[69]. - The company tracks greenhouse gas emissions and reports direct and indirect energy use, participating in the Carbon Disclosure Project[70]. - The company has developed new products aimed at reducing environmental impact, such as ultra-concentrate cleaning chemistries that offer 10 times the uses per container[71]. - The company has established key performance indicators aligned with Sustainability Accounting Standards Board (SASB) Standards for Medical Equipment & Supplies, focusing on financial materiality in sustainability reporting[56]. - STERIS has three facilities accredited to ISO 14001 and ISO 45001 standards, reflecting commitment to environmental management[82]. Regulatory and Compliance Challenges - STERIS is subject to extensive governmental regulations, which require compliance and can significantly impact operations and costs[38][39]. - The company faces extensive regulatory requirements for product approvals, and delays in obtaining these could harm revenues and profitability[106]. - Compliance with international laws and regulations may be burdensome and expensive, impacting operational efficiency[103]. - Regulatory changes regarding greenhouse gas emissions and sustainability reporting may impose additional compliance costs and risks of non-compliance[138]. - The company's EO sterilization operations are at risk from regulatory actions that could significantly affect operational costs and demand for medical devices[141]. Financial Position and Debt - As of March 31, 2025, STERIS had approximately $2,043.7 million of outstanding indebtedness, including $1,350.0 million of Senior Public Notes, $674.2 million of Private Placement Senior Notes, and $34.8 million under the Revolving Credit Facility[153]. - The debt-to-total capital ratio was 23.6% at March 31, 2025, indicating a stable capital structure[209]. - The company expects to continue paying cash dividends for the foreseeable future, as determined by its Board of Directors[187]. Acquisitions and Growth Strategy - Acquisitions are a key part of STERIS's long-term growth strategy, alongside organic opportunities[45]. - The company completed several tuck-in acquisitions during fiscal 2025, with total aggregate consideration of approximately $54.1 million, enhancing its Healthcare and AST segments[201]. - The acquisition of assets from Becton, Dickinson and Company was valued at $539.8 million, financed through borrowings from the existing credit facility[203]. - The company plans to sell its Dental segment for total cash consideration of $787.5 million, with potential additional payments based on revenue targets in fiscal 2025[205]. Employee Relations and Engagement - Employee turnover rate was 16% in fiscal 2025, slightly up from 15% in fiscal 2024, with a goal to achieve a rate of 10% or less[85]. - 88% of employees participated in the pulse survey in fiscal 2025, indicating strong engagement levels[85]. Cybersecurity and Risk Management - The company has implemented a cybersecurity risk management program integrated into its enterprise risk management (ERM) framework, with no material cyberattacks reported in fiscal year 2025[178]. - The company maintains a comprehensive incident response policy for managing cybersecurity incidents, overseen by an Executive Cybersecurity Steering Committee[173]. - The company may face increased cybersecurity risks due to reliance on IT systems and remote work arrangements[149]. Market and Competitive Environment - The competitive environment is intensifying, with increased competition from new products and technologies in infection prevention and sterile processing[128]. - Consolidations among healthcare customers may lead to pricing pressures and potential loss of customers[130]. - Geopolitical instability may lead to supply chain disruptions, increased production costs, and reduced consumer demand, potentially adversely affecting the company's business[102]. Legal and Liability Risks - The company is exposed to product liability claims, which could result in substantial costs and distract management from core responsibilities[110]. - Future litigation related to EO operations may increase costs and divert management attention, potentially impacting financial results[144]. - STERIS agreed to pay up to approximately $48.2 million to resolve claims related to EO exposure in Illinois[143].

Core Insights - STERIS is enhancing its product offerings through new acquisitions and partnerships, currently holding a Zacks Rank 2 (Buy) [1] Group 1: Growth Drivers - The Healthcare segment of STERIS is benefiting from the successful market adoption of its infection prevention consumables and capital equipment, with a reported revenue growth of 5% year over year for Q4 fiscal 2025 [2] - The Applied Sterilization Technologies (AST) division saw a 9% reported growth year over year in Q4 fiscal 2025, driven by a 6% increase in service revenues, with organic revenues in high single digits [3] - STERIS is experiencing increased bioprocessing demand, while global demand from MedTech customers remains stable [3] Group 2: Strategic Acquisitions - STERIS frequently engages in strategic acquisitions and joint ventures, including the recent purchase of surgical instrumentation and sterilization container assets from BD, which enhances its Healthcare product offerings [4] - The company anticipates a strong fiscal year ahead, with reported revenues from continuing operations expected to grow approximately 6-7% in fiscal 2026 [4] Group 3: Stock Performance - Over the past three months, STERIS shares have risen 13.6%, contrasting with an 11.8% dip in the industry, driven by sustained growth in bioprocessing demand and strategic acquisitions [5]

Core Insights - The U.S. Gynecological Chairs and Tables Market was valued at USD 194.8 Million in 2024 and is projected to reach USD 283.8 Million by 2030, with a CAGR of 6.50% [1][9]. Market Growth Drivers - The expansion of the U.S. gynecological chairs and tables industry is driven by the increasing adoption of minimally invasive surgical (MIS) techniques, which enhance procedural efficiency and patient comfort [2][4]. - The demand for laparoscopic procedures is significantly influenced by the prevalence of uterine fibroids, affecting approximately 26 million women in the U.S. aged 15 to 50 [3][4]. Market Segmentation - Gynecological chairs dominate the U.S. market share, while gynecological tables are expected to grow steadily, supported by high procedure volumes in OB/GYN facilities [8]. - The pelvic surgery segment holds a notable market share, while the urology surgery segment is projected to grow at the fastest CAGR of 8.1% due to rising urological procedures [8]. - The office-based surgery (OBS) segment significantly contributes to market revenue, with the Department of Veterans Affairs (VA) segment expected to experience the fastest growth rate [8]. Future Trends and Recommendations - Healthcare facilities are increasingly investing in advanced gynecological chairs and tables to improve procedural outcomes and patient safety as MIS becomes more prevalent [4]. - The report provides insights into market estimates and forecasts from 2018 to 2030, highlighting growth opportunities and trend analyses [5][9].

Core Insights - The performance of Steris' international operations is crucial for understanding its financial resilience and growth potential [1][2][3] - The company's total revenue for the quarter was $1.48 billion, reflecting a 4.3% increase year-over-year [4] International Revenue Analysis - Ireland contributed $38.21 million, or 2.58% of total revenue, exceeding the consensus estimate by 49.78% [5] - Other Foreign Revenues accounted for $363.71 million, or 24.57% of total revenue, falling short of expectations by 12.43% [6] Revenue Forecasts - Analysts project Steris will generate $1.36 billion in revenue for the ongoing fiscal quarter, a 6.1% increase year-over-year [7] - For the full year, total revenue is expected to reach $5.79 billion, a 6% rise from the previous year, with Ireland contributing 2.1% and Other Foreign Revenues 27.4% [8] Conclusion - The reliance on global markets presents both opportunities and challenges for Steris, making the analysis of international revenue trends essential for forecasting future performance [9][10]

Group 1 - The stock price of Steris plc (NYSE: STE) has increased by more than 11% since the upgrade to a Strong Buy rating in March 2025 [1] - The company is expected to benefit from potential market conditions influenced by political factors [1]

STERIS (STE) Q4 2025 Earnings Call May 15, 2025 09:00 AM ET Company Participants Julie Winter - Vice President of Investor Relations & Corporate CommunicationsMichael Tokich - Senior VP & CFODaniel Carestio - President, CEO & DirectorPatrick Wood - Managing DirectorMac Etoch - Senior Research Associate Conference Call Participants David Turkaly - Research AnalystMike Matson - Senior Equity Research AnalystMichael Polark - Senior Equity Research AnalystJason Bednar - Senior Research AnalystBrett Fishbin - Vi ...

Financial Data and Key Metrics Changes - Total reported revenue grew by 4%, while constant currency organic revenue increased by 6% driven by volume and a 20 basis points price increase [6][10] - Gross margin increased by 170 basis points to 44.3%, with positive pricing, favorable mix, and productivity outpacing labor inflation [6][7] - EBIT margin rose by 110 basis points to 24.8% of revenue compared to the previous year [7] - Net income from continuing operations was $270 million, and adjusted earnings per diluted share increased by 14% to $2.74 [7][10] - Free cash flow for fiscal 2025 reached a record $787 million, significantly above guidance due to working capital improvements [8] Business Line Data and Key Metrics Changes - Healthcare constant currency organic revenue grew by 6% for the year, driven by strong recurring revenue streams, while capital equipment revenue declined by 5% [10][11] - Capital equipment orders grew over 12% for the full year, indicating strong underlying demand [11] - AST constant currency organic revenue grew by 9% for the year, with services growing by 7% [12] - Life Sciences saw a 1% increase in constant currency organic revenue, with margins improving to 42.3% [13] Market Data and Key Metrics Changes - The diversified nature of the business allowed the company to deliver results in line with original outlook despite obstacles [10] - The company anticipates revenue growth of 6% to 7% for fiscal 2026 across all segments, with a minor note on AST reflecting high single-digit growth in services [14][15] Company Strategy and Development Direction - The company plans to leverage its strengths to mitigate tariff exposure, with an estimated $30 million impact from tariffs included in the fiscal 2026 outlook [17][18] - The company is well-positioned to deliver both top and bottom line growth in 2026, with no acquisition or divestiture impacts expected [14][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to deliver growth, particularly in recurring revenues and capital equipment orders, despite previous uncertainties in the pharma sector [23][24] - The anticipated tariff impact is expected to be managed strategically, with a focus on mitigating exposure through supply chain adjustments [18][62] Other Important Information - Capital expenditures for fiscal 2025 totaled $370 million, while depreciation and amortization amounted to $476 million [8] - The effective tax rate is planned at approximately 23.5% for fiscal 2026 [18] Q&A Session Summary Question: Comfort in Life Sciences bouncing back to 6% to 7% range - Management noted strong performance in recurring revenues, particularly in consumables, and a rebound in capital equipment orders towards the end of the year [23] Question: Impact of tariffs on EPS - Management discussed various headwinds and tailwinds, including $20 million in restructuring cost savings and lower interest expenses offsetting higher tax rates and tariff impacts [25][26] Question: Cash flow guidance differences - The anticipated $40 million legal settlement for ETO negatively impacts cash flow, along with tariffs and reduced inventory improvements [30] Question: M&A opportunities - Management indicated capacity for M&A from both financial and intellectual perspectives, should the right opportunity arise [32] Question: Onshoring trends - Management suggested that while there are opportunities for onshoring, regulatory complexities may limit rapid shifts in production [36][37] Question: AST growth expectations - Management expressed confidence in accommodating industry growth without capacity constraints [73] Question: Tariff breakdown and mitigation - Management confirmed that the $30 million tariff impact is a net number, with half attributed to China and half to global tariffs, and emphasized ongoing mitigation efforts [58][62]

Core Viewpoint - STERIS plc reported mixed results for the fourth quarter of fiscal 2025, with adjusted earnings per share (EPS) exceeding estimates while revenues fell short of expectations [13]. Financial Performance - Adjusted EPS for Q4 fiscal 2025 was $2.74, a 13.7% increase year-over-year, surpassing the Zacks Consensus Estimate by 5.8% [1] - GAAP EPS was $1.48, down 3.9% from $1.54 in the previous year [1] - Full-year adjusted EPS was $9.22, up 12.4% year-over-year, also exceeding the Zacks Consensus Estimate by 1.4% [2] Revenue Analysis - Q4 revenues from continuing operations were $1.48 billion, a 4.2% increase year-over-year, but missed the Zacks Consensus Estimate by 0.1% [3] - Organic revenues at constant exchange rate (CER) rose 6% year-over-year [3] - Full-year revenues from continuing operations reached $5.46 billion, a 6.2% increase year-over-year, matching the Zacks Consensus Estimate [3] Segment Performance - Healthcare segment revenues increased 5% year-over-year to $1.10 billion, with consumable revenues up 6% and service revenues up 13%, partially offset by a 4% decline in capital equipment revenues [4] - Applied Sterilization Technologies (AST) revenues improved 9% to $273.9 million, driven by 6% growth in service revenues [5] - Life Sciences segment revenues decreased 7% to $149.5 million, attributed to the divestiture of the CECS business, with consumable revenues growing 8% but capital equipment and service revenues declining significantly [6] Margin and Expense Insights - Gross profit for the quarter was $641.2 million, a 10% increase year-over-year, with gross margin expanding 224 basis points to 43.3% [7] - Selling, general and administrative expenses rose 8% to $333.9 million, while research and development expenses increased 0.8% to $27.7 million [8] - Adjusted operating expenses totaled $361.6 million, up 7.4% year-over-year, with adjusted operating margin expanding 153 basis points to 18.9% [8] Cash Flow and Guidance - Cash and cash equivalents at the end of fiscal 2025 were $171.7 million, down from $207 million at the end of fiscal 2024 [10] - Cumulative net cash flow from operating activities was $1.15 billion, compared to $973.2 million in the previous year [11] - For fiscal 2026, the company expects revenues from continuing operations to increase approximately 6-7%, with adjusted EPS projected in the range of $9.90-$10.15 [12]

Core Insights - Steris reported revenue of $1.48 billion for the quarter ended March 2025, reflecting a year-over-year increase of 4.3% and an EPS of $2.74, up from $2.41 in the same quarter last year [1] - The reported revenue was in line with the Zacks Consensus Estimate, showing a slight surprise of -0.09%, while the EPS exceeded expectations by 5.79% [1] Financial Performance Metrics - Healthcare revenues reached $1.06 billion, surpassing the average estimate of $1.05 billion, marking a 4.9% increase year-over-year [4] - Healthcare Products - Consumables generated $352.74 million, slightly below the estimate of $355.87 million, but still showing a 6% increase from the previous year [4] - Healthcare Products - Capital equipment reported $318.03 million, which was below the average estimate of $329.58 million, representing a decline of 4.1% year-over-year [4] - Healthcare Products - Service revenues were $386.41 million, exceeding the estimate of $367.62 million, with a significant year-over-year increase of 12.5% [4] - Life Sciences revenues totaled $149.47 million, falling short of the $158.82 million estimate, reflecting a 7% decrease year-over-year [4] - Applied Sterilization Technologies (AST) revenues were $273.89 million, slightly above the estimate of $269.92 million, with a year-over-year increase of 9.2% [4] - Life Sciences - Service revenues were $36.45 million, below the estimate of $44.18 million, showing a decline of 20.7% year-over-year [4] - Life Sciences - Capital equipment revenues were $36.98 million, under the average estimate of $40.52 million, representing a decrease of 16.4% year-over-year [4] - Life Sciences - Consumables generated $76.04 million, slightly below the estimate of $77.15 million, with an 8% increase year-over-year [4] Operating Income - Operating income for Healthcare was reported at $279.71 million, exceeding the average estimate of $255.95 million [4] - Corporate and Other reported an operating loss of $99.31 million, worse than the estimated loss of $83.07 million [4] - Operating income for Applied Sterilization Technologies (AST) was $122.20 million, slightly above the average estimate of $118.69 million [4] Stock Performance - Steris shares have returned +4.6% over the past month, compared to the Zacks S&P 500 composite's +9.9% change, indicating potential for future outperformance [3]

分组1 - Steris reported quarterly earnings of $2.74 per share, exceeding the Zacks Consensus Estimate of $2.59 per share, and up from $2.41 per share a year ago, representing an earnings surprise of 5.79% [1][2] - The company posted revenues of $1.48 billion for the quarter ended March 2025, slightly missing the Zacks Consensus Estimate by 0.09%, and compared to $1.42 billion in the same quarter last year [2] - Over the last four quarters, Steris has surpassed consensus EPS estimates three times, but has only topped consensus revenue estimates once [2] 分组2 - Steris shares have increased approximately 12.5% since the beginning of the year, significantly outperforming the S&P 500's gain of 0.1% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to those expectations [4][6] - The current consensus EPS estimate for the upcoming quarter is $2.32 on revenues of $1.36 billion, and for the current fiscal year, it is $9.94 on revenues of $5.78 billion [7] 分组3 - The Medical - Instruments industry, to which Steris belongs, is currently ranked in the top 32% of over 250 Zacks industries, indicating a favorable outlook for the sector [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors or through tools like the Zacks Rank [5][6]