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Kinetic Concepts' 3Q profit climbs 20 percent

Fri, 10/21/2011 - 6:45am
The Associated Press

Medical technology company Kinetic Concepts Inc. said Friday that its third-quarter profit climbed about 20 percent to fall within a range it forecast earlier this month.

The San Antonio company, which has agreed to a deal in which it will be taken private, reported net income of $90.7 million, or $1.16 per share, in the three months that ended Sept. 30, up from $75.8 million, or $1.06 per share, in the same quarter last year.

Excluding acquisition-related expenses and other costs, Kinetic Concepts posted adjusted earnings of $1.35 per share.

That topped Wall Street expectations. Analysts surveyed by FactSet expected, on average, adjusted earnings of $1.32 per share.

Revenue rose 5 percent to $531.4 million from $506.7 million a year ago, as foreign exchange rates and higher sales volumes from new markets helped its Active Healing Solutions business. Analysts expected $527.6 million in revenue.

The company said Oct. 10 that its quarterly earnings rose 17 percent to 23 percent to $89 million to $93 million. It also said revenue rose to a range of $529 million to $533 million. The company said it released its partial numbers early to give prospective investors more information about its financial health.

Kinetic Concepts is selling itself to a group of investors for $4.98 billion. The bid from Apax Partners, the Canada Pension Plan Investment Board and the Public Sector Pension Investment Board values Kinetic Concepts at $68.50 per share. That is a premium of 16.5 percent over the price of its stock on July 5, the day before speculation about a deal drove up the stock price.

The deal also includes $1.3 billion in debt.

The company also has said it plans to sell a total of $2.55 billion in senior debt notes that will come due in 2019, a fundraising move that's part of its sale.

The Kinetic Concepts board has unanimously approved the deal, and the company said Friday it will hold a special meeting of shareholders Oct. 28 to vote on it.

Its shares rose 4 cents to $68.24 in morning trading Friday. They have traded in a 52-week range of $36.07 to $68.80.

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