STERIS Lifts Fiscal 2027 Earnings Outlook To $11.35-$11.55 A Share As Life Sciences Revenue Jumps 18%
The sterilization company's new range includes about $0.18 a share from tariff refunds, while one segment's growth outlook was trimmed.
STERIS now expects adjusted earnings of $11.35 to $11.55 per diluted share for fiscal 2027, up from $11.10 to $11.30 before, after Life Sciences revenue rose 18% in the second quarter. The company said the new range includes about $0.18 from tariff refunds received year to date.
A strong quarter, with a tariff assist
STERIS, which sells infection-prevention products and services to healthcare providers and to device and drug manufacturers, reported second-quarter adjusted earnings of $2.94 per diluted share, against $2.47 a year earlier. As-reported net income was $213.7 million, or $2.19 per share, versus $191.9 million, or $1.94.
Revenue rose 9% to $1.6 billion, and constant-currency organic growth was 8%. The pre-tax benefit of tariff refunds on as-reported results was about $20 million, while gross tariff costs stayed flat at $15 million.
CEO Dan Carestio said the updated outlook reflects "stable underlying performance, plus the benefit of tariff refunds received year-to-date." Consolidated revenue growth guidance is unchanged at 7-8% as reported and 6-7% on a constant-currency organic basis.
Life Sciences leads, sterilization slips
Life Sciences revenue climbed 18% to $170.6 million, helped by 53% growth in capital equipment. Operating income rose to $75.8 million from $59.9 million. The segment's full-year organic growth outlook moves to 9-10% from 6-7%.
Healthcare, the largest segment, grew revenue 9% to $1.1 billion, with operating income of $269.2 million against $259.5 million. Its 6-7% organic outlook is unchanged.
Applied Sterilization Technologies, which serves device and drug makers, saw revenue rise 5% to $295.6 million as capital equipment revenue fell 21%. Its organic growth outlook was trimmed to 6-7% from 7-8%.
A second restructuring plan
The company approved a second targeted restructuring plan, mainly in Healthcare, covering facility realignment, product rationalization and some organizational changes. Total charges are about $45 million, including about $10 million in cash, and annualized savings are expected at about $9 million.
Cash from operations for the first six months was $656.1 million, down from $707.8 million, which the company attributed mainly to a smaller working-capital contribution. Free cash flow was $492.5 million versus $527.7 million.
Management hosts its earnings call Thursday at 9:00 a.m. ET, and STERIS will issue a revised outlook that includes the proposed Xodus Medical acquisition after that deal closes.
Sources
- 8-K Filing — STERIS plc (STE) — SEC EDGAR
- Exhibit ste9302026ex991.htm — STERIS plc 8-K exhibit — SEC EDGAR
- STERIS Announces Financial Results for Fiscal 2027 Second — globenewswire.com
