Symmetry Medical Sheds Light on UK Plant Fire - Analyst Blog

Symmetry Medical, Inc. SMA – a leading manufacturer of medical device solutions and surgical instruments – has confirmed reports published earlier regarding the outbreak of a minor electrical fire at its Sheffield, UK manufacturing plant on Mar 8, 2014.

Luckily, the fire remained confined to the temporary Acid Shop at the plant, damaging only 3 tanks out of a line of 9. All other sections of the plant remained out of the fire's reach. As per the local authorities' confirmation, the structure of the temporary Acid Shop remains unaffected. With the fire brought under control promptly, none of the Symmetry Medical employees or first responders was injured in the incident.

Symmetry's shares, which are down around 7% over a year, gained 3.4% yesterday to close at $10.23. The Acid Shop functions alongside the forging operation of Symmetry Medical at the Sheffield plant.

After forging is done, parts are immersed in acid baths to remove materials from the forging process. Management believes that though operations will not be hampered at the plant, throughput may be delayed owing to the ongoing validation of the new tanks.

With refurbishment work already in process, the line of tanks should be repaired, validated and rendered operational by early April. Management projects little financial impact other than revenues of around $1 million being deferred from the first quarter to the second quarter of 2014.

According to Thomas J. Sullivan, President and CEO of Symmetry, it was the joint effort of Symmetry Medical's security team and the local fire fighters that let the fire remain contained to one of the lines in the Acid Shop and did not allow it to spread further.

On Mar 10, management notified Sheffield customers that they are working to minimize customer disruption through SMA's business continuity plan. Moreover, all the customers will continue to receive timely updates from the Symmetry Medical team. The line is expected to be back in service within a relatively short period, pending any necessary customer validation.

Symmetry Medical currently holds a Zacks Rank #3 (Hold).
 
Some better-ranked stocks worth considering in the medical products industry include Enzymotec Ltd. ENZY, Covidien plc COV and SurModics, Inc. SRDX. While Enzymotec carries a Zacks Rank #1 (Strong Buy), Covidien and SurModics carry a Zacks Rank #2 (Buy).