Invacare reports 'mixed' financial results

ELYRIA, Ohio - Invacare reported net sales decreased 2.5% to $244.6 million for the third quarter of 2018 compared to the same period last year.

Net sales for North America HME decreased 7.3% to $73.7 million, driven by decreases in respiratory and lifestyle product sales. Net sales increased 8.9%, however, for mobility and seating products.

“The third quarter performance was mixed,” said Matthew Monaghan, chairman, president and CEO.

Invacare believes providers were cautious about investing in new equipment prior to CMS finalizing a final rule on Nov. 1 that outlines changes to its competitive bidding program.

“These conditions could persist beyond the first quarter 2019 until providers assess their business prospects and the market stabilizes,” Monaghan said.

Also impacting financial results for the third quarter: NA/HME experienced slightly higher costs from materials sourced both internationally and domestically, largely due to the impact of tariffs of about $1.3 million.

“We anticipate the cost increases will continue to be a headwind on our business, and we are focused on identifying and executing remediation actions to potentially reduce this negative impact going forward,” Monaghan said.

In other news, in a Form 8-K filed with the Securities and Exchange Commission on Nov. 1, Invacare reported that it has reduced its workforce by about 50 associates in North America as it “realigns its infrastructure to drive improved cost effectiveness and leverage.” After incurring restructuring charges of about $1.2 million in the fourth quarter, the company expects to generate about $5 million in annualized pre-tax savings as a result of the layoffs.