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Sep 30, 2023
Sotera Health Q3 2023 Earnings Report
Reported a mixed performance with revenue growth offset by a net loss due to legal settlements and increased interest expenses.
Key Takeaways
Sotera Health reported a 6% increase in net revenues to $263 million for Q3 2023, but experienced a net loss of $14 million, or $0.05 per diluted share, due to a $35 million legal settlement and higher interest expenses. Adjusted EBITDA increased by 7% to $134 million, while Adjusted EPS decreased to $0.21. The company reaffirmed its 2023 outlook, anticipating results at the lower end of the previously announced range.
Net revenues increased by 6% to $263 million compared to Q3 2022.
Net loss was $14 million, or $0.05 per diluted share, including a $35 million legal settlement.
Adjusted EBITDA increased by 7% to $134 million compared to Q3 2022.
Adjusted EPS decreased to $0.21, driven by higher interest expense.
Revenue by Segment
Forward Guidance
Sotera Health anticipates 2023 results will be at the lower end of its previously announced outlook due to ongoing market softness.
Positive Outlook
- Net revenues in the range of $1.035 to $1.055 billion, representing growth of approximately 3% to 5% compared to the prior year.
- Adjusted EBITDA in the range of $520 to $535 million, representing growth of approximately 3% to 6% compared to the prior year.
- Tax rate applicable to Adjusted Net Income in the range of 30% to 32%.
- Fully diluted share count remains in the range of 283 million to 285 million shares on a weighted-average basis.
- Year-end Net Leverage Ratio expected to end the year at or below 4.0x.
Challenges Ahead
- Ongoing market softness impacting overall performance.
- Uncertainties caused by changes to the regulatory landscape.
- Potential impact from restructuring items.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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