NASDAQ$SHC

Sotera Health Company · Q3 2022 earnings

Q3 2022 earnings · · Investor relations

Briefing

Sotera Health's Q3 2022 financial performance reflected revenue growth and adjusted EPS improvement.

Sotera Health reported a 10% increase in net revenues to $249 million for Q3 2022, with net income at $25 million, or $0.09 per diluted share. Adjusted EPS improved to $0.23. The company is adjusting its full-year 2022 net revenue growth outlook to 7% - 8% and Adjusted EBITDA growth to 4% - 6%.

  • Net revenues for Q3 2022 increased by 10% to $249 million compared to Q3 2021.
  • Net income for Q3 2022 was $25 million, or $0.09 per diluted share.
  • Adjusted EBITDA for Q3 2022 increased by 7% to $125 million compared to Q3 2021.
  • Adjusted EPS for Q3 2022 improved to $0.23, up from $0.21 in Q3 2021.

Headline financials

Total Revenue

$249M

Previous: $226M+10.0%
EPS (adj)

$0.23

Previous: $0.21+9.5%
Capital Expenditures

-$111M

Previous: -$60.9M-81.7%
Free Cash Flow

-$85.6M

Previous: -$33.5M-155.7%
Net Income

$25.1M

Previous: $27.4M-8.6%
Operating Income

$63.2M

Previous: $65.7M-3.8%
Gross Profit

$136M

Previous: $126M+8.3%
Cash & Equivalents

$164M

Previous: $115M+42.7%
Total Assets

$2.81B

Previous: $2.74B+2.5%
Stock-Based Comp

$4.62M

Previous: $3.55M+30.1%

Revenue & EPS history

Sotera Health · Revenue · Quarterly

$249M

Q3 2022+10%vs Q3 2021
Beat estimate in 13 of 15 quarters(87%)
ActualEstimate

Revenue by segment

Sotera Health · $249M total across 3 segments · Q3 2022

  • Sterigenics
    $158M+8.5%
  • Nelson Labs
    $55.9M+7.3%
  • Nordion
    $35.1M+21.9%

Forward guidance

Sotera Health is updating its 2022 outlook with net revenues expected to be in the range of $995 million to $1.005 billion and Adjusted EBITDA in the range of $500 million to $510 million.

Tailwinds

  • Net revenues in the range of $995 million to $1.005 billion, representing growth of 7% to 8%, compared to the prior year.
  • Adjusted EBITDA in the range of $500 million to $510 million, representing growth of 4% to 6%, compared to the prior year.
  • Tax rate applicable to Adjusted Net Income of approximately 28%.
  • Adjusted EPS of $0.91 to $0.95.
  • Net leverage reduction in the range of 3.2x to 3.3x.

Headwinds

  • Incremental 1% foreign exchange headwind.
  • Slower recovery in certain testing categories at Nelson Labs.
  • Supply chain continuity risks, particularly for the supply of ethylene oxide (“EO”) and cobalt-60 (“Co-60”).
  • Impact of inflationary trends including their impact on energy prices and the supply of labor.
  • Impact of the COVID-19 pandemic including the rate of recoveries of elective procedures and new product development testing.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2022

Historical avgQ3 2022

-2.7%

Avg return

Earnings day

-3.0%

Avg return

5 days after

-2.4%

Avg return

30 days after

25%

6 / 24 earnings

Positive

+11.2%

Q2 2024

Best reaction

-15.9%

Q3 2021

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.3%+2.6%+1.2%
Q4 2025-0.5%-7.1%-22.6%
Q3 2025-1.1%-5.6%-0.3%
Q1 2025+5.2%+11.7%+6.4%
Q4 2024-10.0%-15.9%-13.7%
Q3 2024+2.0%+1.8%-17.9%
Q2 2024+11.2%+10.1%+16.6%
Q1 2024-2.2%+1.8%-0.8%
Q4 2023-12.3%-14.7%-29.6%
Q3 2023+1.2%+5.8%+10.6%
Q2 2023-3.7%-7.1%-13.4%
Q1 2023-7.5%-7.9%-9.2%
Q4 2022-0.5%+3.9%+2.0%
Q3 2022-10.6%-7.7%+28.6%
Q2 2022+2.1%+4.2%-6.7%
Q1 2022-2.8%-5.4%+3.7%
Q4 2021-8.4%-11.4%-1.0%
Q4 2019-8.4%-11.4%-1.0%
Q3 2021-15.9%-13.7%-20.0%
Q2 2021-0.7%-6.3%+1.0%
Q2 2020-0.7%-6.3%+1.0%
Q1 2021-5.4%-3.4%+3.5%
Q1 2020-5.4%-3.4%+3.5%
Q4 2020+8.9%+13.6%+1.4%
Q3 2019
Q2 2019
Q1 2019

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