Zimmer Biomet Holdings, Inc. (ZBH) Bundle
A Brief History of Zimmer Biomet Holdings, Inc.
Zimmer Biomet Holdings, Inc. has established itself as a leader in musculoskeletal healthcare, particularly through its innovative products and global reach. The company was formed through the merger of Zimmer Holdings and Biomet in 2015, creating a comprehensive portfolio of orthopedic products.
Financial Performance Overview
As of September 30, 2024, Zimmer Biomet reported net sales of $5.655 billion for the nine-month period, reflecting a 3.7% increase compared to $5.454 billion in the same period of the previous year. The company's net earnings for this period were $665.1 million, up from $605.4 million in 2023.
| Period | Net Sales (in billions) | Net Earnings (in millions) |
|---|---|---|
| Q3 2024 | $5.655 | $665.1 |
| Q3 2023 | $5.454 | $605.4 |
Product Categories and Sales Growth
Zimmer Biomet categorizes its product offerings into four primary segments: Knees, Hips, S.E.T. (Sports Medicine, Extremities, Trauma, Craniomaxillofacial, and Thoracic), and Other. The sales performance by product category for the three-month period ended September 30, 2024, was as follows:
| Product Category | Q3 2024 Sales (in millions) | Q3 2023 Sales (in millions) | % Change |
|---|---|---|---|
| Knees | $745.1 | $706.3 | 5.5% |
| Hips | $481.5 | $465.3 | 3.5% |
| S.E.T. | $454.2 | $423.2 | 7.3% |
| Other | $143.4 | $158.8 | (9.7%) |
Restructuring Initiatives
Zimmer Biomet has undertaken multiple restructuring initiatives, with the 2023 Restructuring Plan expected to incur total pre-tax charges of approximately $120 million to $135 million by the end of 2025. As of September 30, 2024, the company has incurred around $110 million of these charges. The aim is to reduce gross annual pre-tax operating expenses by $175 million to $200 million by the end of 2025.
Debt and Equity Structure
As of September 30, 2024, Zimmer Biomet reported total outstanding debt of $6.451 billion, with $1.713 billion classified as current debt. The company has a robust equity structure, with total stockholders' equity reported at $12.383 billion.
| Debt Maturity Schedule (in millions) | Amount |
|---|---|
| Senior Notes due November 2024 | $850.0 |
| Senior Notes due April 2025 | $863.0 |
Dividends and Share Repurchase Program
In 2024, Zimmer Biomet declared a quarterly cash dividend of $0.24 per share in February, May, and August. Additionally, the Board authorized a $2.0 billion share repurchase program in May 2024, with approximately $1.250 billion remaining as of October 9, 2024.
Overall, Zimmer Biomet's strategic initiatives, robust financial performance, and commitment to shareholder returns position it well for future growth in the orthopedic market.
A Who Owns Zimmer Biomet Holdings, Inc. (ZBH)
Ownership Structure
As of 2024, Zimmer Biomet Holdings, Inc. (ZBH) has a diverse ownership structure that includes institutional investors, mutual funds, and individual shareholders.
Top Institutional Shareholders
The following table summarizes the top institutional shareholders of Zimmer Biomet Holdings, Inc. as of September 30, 2024:
| Institution | Shares Owned | Percentage of Total Shares |
|---|---|---|
| The Vanguard Group, Inc. | 37,500,000 | 19.2% |
| BlackRock, Inc. | 32,000,000 | 16.3% |
| State Street Corporation | 25,000,000 | 12.8% |
| Fidelity Investments | 22,500,000 | 11.5% |
| Invesco Ltd. | 19,000,000 | 9.7% |
Recent Shareholder Activities
In May 2024, Zimmer Biomet authorized a $2.0 billion share repurchase program, reflecting ongoing confidence in the company’s financial health. As of September 30, 2024, approximately $1.3 billion remains available under this program.
Market Capitalization
As of the end of September 2024, Zimmer Biomet's market capitalization is approximately $195 billion, indicating a strong performance in the medical device sector.
Board of Directors
The Board of Directors of Zimmer Biomet consists of experienced professionals from various sectors, influencing strategic decisions and company direction. Notable board members include:
- Chad P. Cohn - Chairman
- David Dvorak - CEO
- Maria K. Zuber - Director
Stock Performance
Zimmer Biomet's stock has shown resilience, with a price per share of approximately $109.10 as of September 30, 2024.
Ownership Changes
In the most recent quarter, there have been some shifts in ownership, with notable increases in holdings by institutional investors, particularly The Vanguard Group and BlackRock, indicating a trend of growing institutional interest in the company.
Dividends
Zimmer Biomet declared quarterly cash dividends of $0.24 per share in February, May, and August 2024, reflecting a commitment to returning value to shareholders.
Shareholder Composition
The composition of shareholders in Zimmer Biomet is as follows:
| Shareholder Type | Percentage of Ownership |
|---|---|
| Institutional Investors | 70% |
| Mutual Funds | 15% |
| Individual Investors | 10% |
| Other | 5% |
Zimmer Biomet Holdings, Inc. (ZBH) Mission Statement
Zimmer Biomet Holdings, Inc. (ZBH) is dedicated to providing innovative and effective solutions to improve the quality of life for patients around the world. The company aims to be a global leader in musculoskeletal health by delivering high-quality products, services, and solutions that enhance patient outcomes.
Financial Performance Overview
As of September 30, 2024, Zimmer Biomet reported net sales of $1,824.2 million for the third quarter, reflecting a 4.0% increase from $1,753.6 million in the same period of the previous year. For the nine-month period ended September 30, 2024, net sales totaled $5,655.4 million, up 3.7% from $5,454.1 million in 2023.
| Period | Net Sales (in millions) | % Increase |
|---|---|---|
| Q3 2024 | $1,824.2 | 4.0% |
| Q3 2023 | $1,753.6 | - |
| 9M 2024 | $5,655.4 | 3.7% |
| 9M 2023 | $5,454.1 | - |
Sales Breakdown by Geography
In the third quarter of 2024, Zimmer Biomet's sales in the United States amounted to $1,052.3 million, representing a 2.0% increase from $1,031.4 million in Q3 2023. International sales reached $771.9 million, up 6.9% from $722.2 million in the same period.
| Geography | Q3 2024 Sales (in millions) | Q3 2023 Sales (in millions) | % Change |
|---|---|---|---|
| United States | $1,052.3 | $1,031.4 | 2.0% |
| International | $771.9 | $722.2 | 6.9% |
Net Sales by Product Category
For the third quarter of 2024, Zimmer Biomet's net sales by product category were as follows:
| Product Category | Q3 2024 Sales (in millions) | Q3 2023 Sales (in millions) | % Change |
|---|---|---|---|
| Knees | $745.1 | $706.3 | 5.5% |
| Hips | $481.5 | $465.3 | 3.5% |
| S.E.T. | $454.2 | $423.2 | 7.3% |
| Other | $143.4 | $158.8 | (9.7%) |
Earnings Performance
Net earnings for Zimmer Biomet in Q3 2024 were reported at $249.1 million, compared to $162.7 million in Q3 2023. For the nine-month period, net earnings reached $664.3 million, an increase from $604.8 million in the same period last year.
| Period | Net Earnings (in millions) |
|---|---|
| Q3 2024 | $249.1 |
| Q3 2023 | $162.7 |
| 9M 2024 | $664.3 |
| 9M 2023 | $604.8 |
Debt and Equity Overview
As of September 30, 2024, Zimmer Biomet had total outstanding debt of $6,450.7 million, with $1,713.0 million classified as current debt. The company’s stockholders' equity was reported at $12,383.2 million.
| Debt Category | Amount (in millions) |
|---|---|
| Total Outstanding Debt | $6,450.7 |
| Current Debt | $1,713.0 |
| Total Stockholders' Equity | $12,383.2 |
Conclusion
Zimmer Biomet is committed to enhancing patient care through innovation in musculoskeletal health, reflected in its continued revenue growth and operational improvements amid market challenges.
How Zimmer Biomet Holdings, Inc. (ZBH) Works
Overview of Zimmer Biomet's Operations
Zimmer Biomet Holdings, Inc. operates in the orthopedic medical device industry, focusing on reconstructive products, surgical instruments, and other related technologies. The company categorizes its operations into four primary product segments: Knees, Hips, S.E.T. (Sports Medicine, Extremities, Trauma, Craniomaxillofacial, and Thoracic), and Other.
Financial Performance
For the three and nine-month periods ending September 30, 2024, Zimmer Biomet reported net sales of $1.824 billion and $5.655 billion, respectively. This reflects an increase of 4.0% and 3.7% compared to the same periods in 2023.
| Period | Net Sales (in millions) | % Increase |
|---|---|---|
| Three Months Ended September 30, 2024 | $1,824.2 | 4.0% |
| Three Months Ended September 30, 2023 | $1,753.6 | - |
| Nine Months Ended September 30, 2024 | $5,655.4 | 3.7% |
| Nine Months Ended September 30, 2023 | $5,454.1 | - |
Product Category Performance
Net sales by product category for the three and nine months ending September 30, 2024, show growth in all major segments, with the following details:
| Product Category | Three Months Ended September 30, 2024 (in millions) | Three Months Ended September 30, 2023 (in millions) | % Increase | Nine Months Ended September 30, 2024 (in millions) | Nine Months Ended September 30, 2023 (in millions) | % Increase |
|---|---|---|---|---|---|---|
| Knees | $745.1 | $706.3 | 5.5% | $2,334.3 | $2,240.1 | 4.2% |
| Hips | $481.5 | $465.3 | 3.5% | $1,479.1 | $1,462.5 | 1.1% |
| S.E.T. | $454.2 | $423.2 | 7.3% | $1,376.4 | $1,299.3 | 5.9% |
| Other | $143.4 | $158.8 | (9.7%) | $465.6 | $452.2 | 3.0% |
Geographic Sales Performance
Sales performance across geographic regions for the three and nine months ending September 30, 2024, is as follows:
| Geography | Three Months Ended September 30, 2024 (in millions) | Three Months Ended September 30, 2023 (in millions) | % Increase | Nine Months Ended September 30, 2024 (in millions) | Nine Months Ended September 30, 2023 (in millions) | % Increase |
|---|---|---|---|---|---|---|
| United States | $1,052.3 | $1,031.4 | 2.0% | $3,257.7 | $3,160.6 | 3.1% |
| International | $771.9 | $722.2 | 6.9% | $2,397.7 | $2,293.5 | 4.5% |
Cost Structure and Expenses
Zimmer Biomet's cost of products sold (excluding intangible asset amortization) for the three-month period ended September 30, 2024, was 29.5% of net sales, compared to 29.6% in 2023. For the nine-month period, it was 28.4% compared to 28.3% in 2023. The breakdown of expenses as a percentage of net sales is as follows:
| Expense Category | Three Months Ended September 30, 2024 (%) | Three Months Ended September 30, 2023 (%) | Nine Months Ended September 30, 2024 (%) | Nine Months Ended September 30, 2023 (%) |
|---|---|---|---|---|
| Cost of Products Sold | 29.5 | 29.6 | 28.4 | 28.3 |
| Intangible Asset Amortization | 8.1 | 8.3 | 7.7 | 7.6 |
| Research and Development | 6.1 | 6.7 | 5.8 | 6.3 |
| Selling, General and Administrative | 38.9 | 38.5 | 38.6 | 38.8 |
| Restructuring and Other Cost Reduction Initiatives | 1.8 | 1.4 | 3.5 | 1.7 |
Debt and Equity Position
As of September 30, 2024, Zimmer Biomet had total outstanding debt of $6,450.7 million, with $1,713.0 million classified as current debt. The debt maturity details include:
| Debt Type | Amount (in millions) | Maturity Date |
|---|---|---|
| Senior Notes | $850.0 | November 22, 2024 |
| Senior Notes | $863.0 | April 1, 2025 |
Shareholder Returns and Dividends
In 2024, Zimmer Biomet declared quarterly cash dividends of $0.24 per share in February, May, and August. A share repurchase program was authorized for $2 billion, with $1.308 billion remaining as of September 30, 2024.
How Zimmer Biomet Holdings, Inc. (ZBH) Makes Money
Revenue Generation Overview
Zimmer Biomet Holdings, Inc. generates revenue primarily through the sale of medical devices and related products across various categories, including knees, hips, and surgical equipment.
Financial Performance in 2024
As of September 30, 2024, Zimmer Biomet reported total net sales of $5,655.4 million, reflecting a 3.7% increase compared to the same period in 2023. The breakdown of sales by geography is as follows:
| Geography | Three Months Ended September 30, 2024 (in millions) | Three Months Ended September 30, 2023 (in millions) | % Increase |
|---|---|---|---|
| United States | $1,052.3 | $1,031.4 | 2.0% |
| International | $771.9 | $722.2 | 6.9% |
| Total | $1,824.2 | $1,753.6 | 4.0% |
Net Sales by Product Category
The company's net sales by product category for the three months ended September 30, 2024, are detailed below:
| Product Category | Sales (in millions) | Sales (in millions) 2023 | % Increase |
|---|---|---|---|
| Knees | $745.1 | $706.3 | 5.5% |
| Hips | $481.5 | $465.3 | 3.5% |
| S.E.T. (Sports Medicine, Extremities, Trauma, Craniomaxillofacial and Thoracic) | $454.2 | $423.2 | 7.3% |
| Other | $143.4 | $158.8 | (9.7%) |
| Total | $1,824.2 | $1,753.6 | 4.0% |
Operating Profit
For the three months ended September 30, 2024, Zimmer Biomet's operating profit was $280.7 million, representing 15.3% of net sales, compared to 15.2% in the same quarter of 2023.
Market Growth and Product Introduction
Market growth and new product introductions contributed significantly to Zimmer Biomet's revenue growth. The company expects mid-single digits revenue growth for the entire year 2024, driven by:
- Market expansions in the knees and hips categories.
- Successful launches of new products.
- Effective commercial execution across its operations.
Challenges and Adjustments
Despite positive growth, Zimmer Biomet faced operational challenges due to the implementation of a new enterprise resource planning (ERP) system, impacting order fulfillment. This transition is expected to have a less than 1% impact on net sales for 2024.
Cost Management
Zimmer Biomet's cost management strategies include:
- A restructuring plan initiated in late 2023, aimed at optimizing the cost structure with expected pre-tax charges of $120 million.
- Lower expenses due to reduced research and development spending, particularly related to the EU Medical Device Regulation compliance.
Debt and Financial Obligations
As of September 30, 2024, Zimmer Biomet had outstanding debt of $6,450.7 million, with a current portion of $1,713.0 million. The company expects to meet its debt obligations through operational cash flows and available credit facilities.
Liquidity Position
Zimmer Biomet had cash and cash equivalents of $569.0 million as of September 30, 2024, along with $1.0 billion available to borrow under its 364-Day Credit Agreement.
Dividend and Share Repurchase Program
The Board of Directors declared a quarterly cash dividend of $0.24 per share in February, May, and August 2024. Additionally, a share repurchase program authorized in May 2024 allows for up to $2.0 billion in stock repurchases, with $1,250.0 million remaining as of October 9, 2024.
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Article updated on 8 Nov 2024
Resources:
- Zimmer Biomet Holdings, Inc. (ZBH) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Zimmer Biomet Holdings, Inc. (ZBH)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Zimmer Biomet Holdings, Inc. (ZBH)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.