Covetrus posts smaller Q3 loss than last year, stock rises
Covetrus Inc. (Nasdaq: CVET), the Portland-based animal health technology and services company, on Friday reported a smaller third-quarter loss than in 2020, after a 3% rise in net sales for Q3 this year.
The company said its third-quarter net loss totaled $4 million, or 3 cents a share, compared with a net loss of $35 million, or 33 cents a share a year ago. Covetrus said the improvement came primarily from a $19 million increase in gross profit, a modest decrease in selling, general and administrative expense and an income tax benefit.
Net sales for the third quarter totaled $1.16 billion, an increase of 3% compared to the year-ago period.
Shares of Covetrus began trading Friday at $20.51 and had risen slightly by mid-morning to $20.65.
Geographic results
In North America, net sales for the third quarter increased 13% to $697 million. Covetrus cited healthy companion animal end-market demand and market share improvement as drivers for that growth. Also, prescription management net sales increased 24% year-over-year, up from the 19% year-over-year growth reported in the second quarter.
In Europe, net sales for the third quarter decreased 12% due to challenges in the company's U.K. and German businesses. Growth in the company's proprietary brands and in the businesses in Ireland, the Netherlands and Czech Republic offset some of these issues, Covetrus said.
In the Asia-Pacific and emerging markets segment, net sales for the third quarter increased 7% to $116 million. Covetrus cited strong sales execution and healthy underlying companion animal end-market demand for the growth. Brazil and Australia also were notable contributors to the growth.
The company reiterated its full-year 2021 financial guidance range, expecting organic net sales growth of 5% to 6% and adjusted earnings before interest, taxes, depreciation and amortization of $245 million to $255 million.
Executive promotions
Covetrus also made some personnel announcements.
Matt Malenfant was promoted to chief commercial officer from president of North America. Animal-health veteran, Tom Forte, was promoted to president, North America, and is now responsible for leadership of all commercial teams in the North America region.
Leadership for Covetrus’ global operations, pharmacies, facilities and real estate has been consolidated Bekki Kidd, the newly appointed head of global operations. She now reports directly to Covetrus CEO Ben Wolin.
Covetrus, which has a market capitalization of $2.6 billion, provides a range of technology and services for over 100,000 veterinary practices around the world, and employs more than 5,500 people.
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