4Q Profit Drops 44% for Mentor Corp.

Mentor Corp., a maker of health care products ranging from breast implants to disposable catheters, said Wednesday that profit dropped 44 percent in a fiscal fourth quarter weighed down by special charges. However, sales rose and adjusted results beat Wall Street estimates.

The company’s shares were halted in after-hours trading, having closed earlier up 3.5 percent at $ 39.70 on the New York Stock Exchange.

For the three months ended March 31, Mentor earned $ 8.4 million, or 19 cents per share, down from $ 15 million, or 31 cents per share, a year ago. Excluding items such as severance payments and asset devaluation as part of a large restructuring program, the company said it would have earned 42 cents per share.

Revenue rose 12 percent to $ 131.6 million from $ 117.3 million. The company’s cosmetic surgery business posted 13 percent growth to sales of $ 68.7 million while revenue increased 18 percent for its urology segment to $ 35.1 million. The company’s clinical and consumer health care unit posted a more modest 5 percent sales increase to $ 27.8 million.

Favorable exchange rates contributed about $ 2.6 million of overall growth, Mentor said.

Analysts expected earnings of 37 cents per share, after adjustments, on sales of $ 128.9 million, according to a Thomson Financial survey.

For the year, earnings inched up to $ 54.9 million, or $ 1.17 per share, from $ 54.8 million, or $ 1.13 per share. Revenue grew 15 percent to $ 483.4 million.

Excluding items, the company’s year-end profit would have been $ 1.40 per share. Analysts were looking for adjusted profit of $ 1.34 per share and sales of 480.3 million.

For 2006, Mentor predicted that sales growth will be in the low double digits, leading to earnings of $ 1.60 to $ 1.65 per share. Analysts expect profit of $ 1.56 per share with sales growing 11 percent to $ 535.9 million.

The company said its 2006 forecast excludes any contribution from a silicone gel breast implant that is currently awaiting regulatory approval.