DENTSPLY SIRONA(US:XRAY)2025-05-08 13:13Financial Performance - Dentsply Sirona reported a net income of $19 million for the three months ended March 31, 2025, compared to $17 million for the same period in 2024, reflecting a growth of approximately 11.76%[13] - Total comprehensive income for the first quarter of 2025 was $90 million, significantly up from a loss of $13 million in Q1 2024[13] - Net income for Q1 2025 was $19 million, an increase from $17 million in Q1 2024, representing a growth of approximately 11.76%[18] - Total net sales for Q1 2025 were $879 million, down from $953 million in Q1 2024, reflecting a decrease of about 7.77%[26] - Net loss attributable to Dentsply Sirona was $20 million, with diluted earnings per share of $0.10, an increase from $0.09 in the previous year[166] Cash and Liquidity - Cash and cash equivalents increased to $398 million as of March 31, 2025, up from $272 million at the end of 2024, representing a growth of 46.4%[15] - Cash provided by operating activities was $7 million, a decrease of $18 million compared to $25 million in the same period of 2024[172] - Cash used in investing activities decreased to $17 million from $43 million in the prior year, primarily due to lower capital expenditures of $15 million[174] - The Company had $584 million of borrowings available under lines of credit as of March 31, 2025, including a $700 million multi-currency credit facility expiring in May 2028[178] Assets and Liabilities - Total assets rose to $6,050 million at the end of Q1 2025, compared to $5,753 million at the end of 2024, indicating an increase of 5.2%[15] - Total liabilities increased to $4,040 million as of March 31, 2025, compared to $3,810 million at the end of 2024, marking a rise of 6.03%[15] - The company’s equity attributable to Dentsply Sirona was $2,010 million at the end of Q1 2025, up from $1,942 million at the end of 2024, reflecting a growth of 3.5%[15] - Total current liabilities increased to $1,793 million from $1,589 million, reflecting a rise of 12.8%[15] Sales and Revenue Segments - Equipment & Instruments sales increased to $134 million in Q1 2025 from $125 million in Q1 2024, a growth of 7.20%[26] - Connected Technology Solutions sales decreased to $235 million in Q1 2025 from $247 million in Q1 2024, a decline of 4.86%[26] - Orthodontics sales fell to $59 million in Q1 2025 from $98 million in Q1 2024, a significant decrease of 40.82%[26] - Organic sales decreased by 4.4% due to lower volumes in the Orthodontic and Implant Solutions segment, particularly from the suspension of the Byte aligner system and lower implant volumes[129] Expenses and Cost Management - Selling, general, and administrative expenses (SG&A) decreased by $57 million or 13.6% to $358 million, primarily due to lower headcount costs related to Byte products[150][152] - Research and development (R&D) expenses decreased by $6 million or 14.8% to $36 million, with ongoing investments in digital workflow solutions and product development[150][153] - The company expects to incur between $35 million and $50 million in non-recurring restructuring charges under the 2024 Plan, which aims for annual cost savings of $80 million to $100 million[185] Legal and Regulatory Matters - The company reached a settlement in principal for $84 million related to a class action lawsuit, expecting to receive an offsetting insurance receivable of approximately $78 million[79] - The company is involved in multiple ongoing securities litigations, including a consolidated case with lead plaintiffs appointed on February 21, 2025[88] - The IRS is examining the company's federal income tax returns for 2015 and 2016, proposing an adjustment that could result in additional federal income taxes on a $451 million distribution[97] Market and Economic Conditions - The company anticipates continued macroeconomic challenges, particularly in Germany, which represented 11% of sales for the three months ended March 31, 2025[115] - The U.S. government has implemented a baseline 10% tariff on foreign goods, which may impact the company's supply chain and costs[116] - The company is focusing on strategic procurement initiatives and cost-containment measures to mitigate inflationary pressures and competitive challenges[117] Future Outlook - The company expects to recognize most of the remaining deferred revenue in net sales within the next twelve months, indicating a positive outlook for future revenue recognition[28] - The Company is currently evaluating the impact of ASU No. 2024-03 on its consolidated financial statements, which requires disaggregated disclosure of income statement expenses effective after December 15, 2026[22] - The Company is assessing the implications of ASU No. 2024-04 regarding the accounting for the settlement of a debt instrument as an induced conversion, effective after December 15, 2025[23]