Owens & Minor Reports $24.98 Million Net Loss in Q1 2025, Revenue Increases 0.7%

Owens & Minor, Inc. reported a net loss of $24.98 million, or $(0.32) per share, for the first quarter of 2025, compared to a net loss of $21.89 million, or $(0.29) per share, in the same period of 2024. The company's total revenue for the quarter was $2.63 billion, reflecting a slight increase of 0.7% from $2.61 billion year-over-year. The increase in revenue was primarily driven by a 5.7% growth in the Patient Direct segment, which generated $673.88 million, while the Products & Healthcare Services segment saw a decline of 0.8%, totaling $1.96 billion. The financial results were impacted by acquisition-related charges of $16 million associated with the planned acquisition of Rotech Healthcare Holdings Inc., as well as a $3.9 million increase in exit and realignment charges.

In terms of operational metrics, Owens & Minor's cash and cash equivalents increased by 20.4% to $59.44 million as of March 31, 2025, compared to $49.38 million at the end of 2024. However, accounts receivable decreased by 15.9% to $580.18 million, while merchandise inventories rose by 24.4% to $1.41 billion. The company reported a Days Sales Outstanding (DSO) of 19.6 days, down from 23.3 days, indicating improved efficiency in collecting receivables. The company also engaged in a Receivables Sale Program, selling $343 million in accounts receivable during the quarter, which contributed to cash flow.

Strategically, Owens & Minor is actively pursuing the acquisition of Rotech for approximately $1.36 billion, with expected tax benefits of around $40 million. The acquisition is anticipated to close in the first half of 2025, pending regulatory approvals. Additionally, the company is exploring the potential sale of its Products & Healthcare Services segment, although no definitive timeline has been established. This strategic shift aims to focus on the higher growth and margin potential of the Patient Direct segment.

The company incurred $31 million in exit and realignment charges during the quarter, primarily related to operational improvements and professional fees associated with the potential sale of the Products & Healthcare Services segment. These charges reflect ongoing efforts to streamline operations and enhance profitability. Furthermore, Owens & Minor's total debt as of March 31, 2025, stood at approximately $1.95 billion, with a significant portion attributed to term loans and senior notes.

Looking ahead, Owens & Minor's management expressed cautious optimism regarding future performance, contingent on the successful execution of its strategic initiatives, including the Rotech acquisition and potential divestiture of the Products & Healthcare Services segment. The company remains focused on improving operational efficiencies and managing costs amid ongoing market challenges, including competitive pricing pressures and foreign currency fluctuations.