Zimmer Holdings, Inc. Reports First Quarter 2009 Financial Results

Net Sales of $993 million represents a decrease of 6.3% reported (1.5% constant currency)
Diluted EPS for the first quarter were $0.91 reported, a decrease of 10.8% from the prior year period, and $0.95 adjusted, a decrease of 8.7% from the prior year period
Reaffirms full-year sales and adjusted EPS guidance

(WARSAW, IN) April 23, 2009—Zimmer Holdings, Inc. (NYSE and SWX: ZMH) today reported financial results for the quarter ended March 31, 2009. The Company reported first quarter net sales of $993 million, a decrease of 6.3% reported and 1.5% constant currency from the first quarter of 2008. Diluted earnings per share for the quarter were $0.91 reported and $0.95 adjusted, a decrease of 8.7% adjusted from the prior year period.

"Our performance for the first quarter was consistent with our expectations and we are reaffirming our 2009 sales and earnings guidance," said David Dvorak, Zimmer President and CEO. "We continue to make progress in our efforts to rebuild momentum in our business. Our success at the annual AAOS meeting was highlighted by the large number of surgeons who attended our booth. In addition, we showcased our Trabecular Metal^TM Technology and other innovative products, as well as our enhanced medical education program. Moreover, we have now emerged from federal monitoring and the Deferred Prosecution Agreement with global business practices that position us for sustainable, long-term growth."

Net earnings for the first quarter were $202.2 million on a reported basis and $210.0 million on an adjusted basis, a decrease of 14.0% adjusted from the prior year period. Operating cash flow for the first quarter was $185 million.

During the quarter, the Company utilized $54 million of cash and $247 million in borrowings to acquire 8.6 million shares under its $1.25 billion repurchase program. At the end of the quarter, $833 million of share repurchase authorization remained available under this program, which expires on December 31, 2009.

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