OM initiates realignment in ‘evolving market’ 

RICHMOND, Va. - Owens & Minor has initiated a companywide “operating model realignment program” to accelerate profit improvement and reduce costs. 

The company expects the realignment to improve profitability and cash flow by about $30 million of adjusted operating income in 2023; $200 million of adjusted operating income by 2025; and $250 million to $400 million of working capital benefit by 2025. 

“Fourth-quarter results showed that we need to move quickly to offset volume decline, cost and pricing headwinds, particularly in our global products division,” said Edward A. Pesicka, president & CEO. “It is clear that our company’s cost structure needs to be better aligned with the evolving market. We believe this program will enhance our strong quality of service to our customers, increase our margins, and allow us to more rapidly reduce debt and reinvest in higher-growth and more profitable opportunities.”  

Dan Starck, executive vice president of OM, president of the Patient Direct segment and CEO of Apria, will lead the realignment; and Perry Bernocchi will be promoted to CEO of the Patient Direct segment effective March 1. 

OM announced the realignment as part of its financial results for the fourth quarter and full year 2022. 

The company reported consolidated revenue of $2.6 billion for the fourth quarter, including $617 million for the Patient Direct segment, a 10% increase on an adjusted basis for the Apria acquisition. It reported revenue of nearly $10 billion for the full year. 

It reported adjusted EBITDA of $117 million for the quarter and $518 million for the full year. 

OM expects revenue for 2023 to be in the range of $10.1 billion to $10.5 billion and adjusted EBITDA to be $490 million to $550 million.