Biomet ends fiscal 2012 third quarter with $5.4 billion of net debt

By Lisa Kerner

Charlotte, N.C., April 11 - Biomet Inc. ended the third quarter of fiscal 2012 on Feb. 29 with cash and cash equivalents of $496 million and net debt of about $5.4 billion.

According to Biomet, from May 31, 2008, the first fiscal year-end after the company's acquisition by a private equity group, to Feb. 29, net debt decreased by $749.1 million due to a $368.4 million increase in cash and cash equivalents and a $380.7 million reduction of gross debt. The reduction of gross debt includes a $179.4 million decrease due to favorable foreign currency translation on Biomet's euro-denominated debt.

At Feb. 29, Biomet's senior secured leverage ratio was 2.83 times, compared with 4.01 times at May 31, 2008.

Biomet said the total ratio of debt to last-12-months-adjusted EBITDA was 5.35 times at Feb. 29, compared with 6.97 times as of May 31, 2008.

Lower-than-average interest rates on Biomet's term loans resulted in third-quarter interest expense totaling $117.2 million, compared with $124.0 million during the third quarter of fiscal 2011.

During the fiscal third quarter, Biomet generated $116.0 million of free cash flow, compared with $106.7 million during the prior-year period.

Net sales were up 5% for the fiscal third quarter at $708.9 million, compared to $678.0 million during the third quarter of fiscal 2011.

The increase was driven by a 5% increase in U.S. sales and a 7% increase in international sales. Changes in foreign currency exchange rates had a negligible effect on consolidated sales growth rates, according to company news release.

Biomet president and chief executive officer Jeffrey Binder cited the company's consistent performance across all geographies and improved sales in many product categories.

Binder also noted the future opportunities that the pending $280 million cash acquisition of DePuy Orthopaedics, Inc.'s worldwide trauma business will bring to Biomet.

Biomet is a Warsaw, Ind.-based designer, manufacturer and marketer of products used primarily by musculoskeletal medical specialists in both surgical and non-surgical therapy.

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