Hanger Orthopedic Group, Bethesda, Maryland, announced its results for the first quarter of 2010. During the period in question, net sales reached $178.3 million, an increase of $9.2 million, or 5.4 percent, for the same period last year. According to a company press release, the increase was primarily the result of a $5.4 million, or 3.6 percent, increase in same-center sales in the patient care segment, a $0.9 million, or 4.3 percent, increase in sales from the company’s distribution segment, and a $2.9 million increase principally related to sales from acquired entities.
“I am pleased that we opened 2010 with a very positive fashion,” said Thomas F. Kirk, Hanger president and CEO. “Our patient care segment performed well, posting a 3.6 percent same-store increase, and we continue to see positive results from our other growth initiatives. The increased revenue combined with our expense management generated 7.5 percent increase in operating income and a 20 basis point improvement in operating margin.”
For 2010, the company expects full-year revenues to be between $815 million and $825 million and diluted EPS, excluding the cost related to the corporate relocation, in the range of $1.27 to $1.29. As announced in February, Hanger is in the process of relocating its corporate headquarters from Bethesda, Maryland, to Austin, Texas, and anticipates the move will be substantially completed by the end of the third quarter of 2010. The cost of this move is reported as a separate component of income from operations. In connection with the move, Hanger reported $2.1 million of severance and relocation costs for the three months ended March 31, 2010. The company anticipates incurring approximately $8.0 million to $10.0 million of additional severance and relocation costs through the third quarter of 2010, as well as lease-exit cost of approximately $3.0 million to $5.0 million. Once complete, Hanger anticipates that the move will result in a reduction of operating expenses of approximately $2.5 million to $3.5 million annually.
