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Contact: Patricia A. Spinella
Investor Relations
(201) 847-5453
Email: patricia_spinella@bd.com
Colleen T.
White
Corporate Communications
(201) 847-5369
Email: colleen_white@bd.com
Franklin Lakes, NJ
(July 22, 2004) --
BD (Becton, Dickinson and Company) today reported quarterly revenues of $1.258 billion for the fiscal third quarter ended June 30, 2004, representing an increase of 8 percent from the same period a year ago. At constant foreign exchange rates, revenues increased 5 percent. Revenue growth in all segments benefited from favorable foreign currency translation, particularly with respect to the Euro.
Diluted earnings per share and net income for the quarter were 41 cents and $109 million, respectively. As announced in our July 2, 2004 press release, third quarter results included a pre-tax charge of $100 million relating to the agreement with Retractable Technologies, Inc. to settle its lawsuit against BD. This charge reduced net income by $63 million and diluted earnings per share by 24 cents.
For the third quarter of fiscal 2003, reported diluted earnings per share and net income were 49 cents and $130 million, respectively. Included in these prior period results was a charge of $34 million related to the write- down of certain intangible assets and inventory in the BD Biosciences segment. This charge reduced diluted earnings per share by 8 cents and net income by $20 million. Excluding the charge of 8 cents, pro forma diluted earnings per share for the third quarter of fiscal 2003 were 57 cents.
"These results reflect another solid quarter of revenue and earnings growth, fueled especially by sales of safety-engineered products and immunocytometry instruments and reagents, along with improved gross profit margins," stated Edward J. Ludwig, Chairman, President and Chief Executive Officer. "In addition, having settled the lawsuit, we can now concentrate all of our efforts on driving revenue growth through innovation focused on products that have a higher benefit to patients, healthcare workers and researchers."
Q3 Segment Results
In the BD Medical segment, worldwide revenues for the quarter were $683 million, representing an increase of 5 percent over the prior year period. BD Medical revenues reflect the continued conversion in the U.S. to safety- engineered products, which had sales of $110 million, as compared with $101 million in the prior year's quarter. The BD Medical sales growth rate was constrained by comparison to a particularly strong quarter in fiscal 2003.
In the BD Diagnostics segment, worldwide revenues for the quarter were $374 million, representing an increase of 11 percent over the prior year period. Revenue growth of 12 percent in the Preanalytical Systems unit of the segment reflects the continued conversion in the U.S. to safety-engineered devices which had sales of $80 million, compared with $66 million in the prior year's quarter. Revenue growth of 9 percent in the Diagnostic Systems unit of the segment included solid worldwide sales of its molecular diagnostic platform, BD ProbeTec™ ET.
In the BD Biosciences segment, worldwide revenues for the quarter were $201 million, representing an increase of 12 percent over the prior year period. Instrument revenue growth was driven by sales of the recently launched BD FACSCanto™ and BD FACSArray™ analyzers and continued strong performance of the BD FACSAria™ cell sorter. Sales of flow cytometry reagents were also strong in both the clinical and the research markets.
Q3 Geographic Results
Third quarter revenues in the U.S. of $617 million represented an increase of 6 percent over the prior year period. Revenues outside the U.S. of $641 million represented an increase of 10 percent over the prior year period, or 4 percent at constant foreign exchange rates.
Nine-Month Results
For the nine-month period ended June 30, 2004, reported revenues were $3.728 billion, an 11 percent increase over the same period a year ago, or 6 percent at constant foreign exchange rates. Reported diluted earnings per share for the nine-month period were $1.51. Included in the nine-month results of fiscal 2004 was a first quarter charge of 11 cents related to certain actions taken in connection with our blood glucose monitoring products and a third quarter charge of 24 cents related to the previously mentioned litigation settlement. Excluding both these charges, pro forma diluted earnings per share for the nine-month period were $1.86. For the same nine- month period in fiscal 2003, reported diluted earnings per share were $1.46. Excluding the aforementioned charge of 8 cents related to the write-down of certain intangible assets and inventory in the BD Biosciences segment, pro forma diluted earnings per share for the nine-month period in fiscal 2003 were $1.54.
Fiscal 4Q 2004 Outlook
For the fourth quarter, the Company expects reported diluted earnings per share will increase about 10 percent.
Conference Call Information
A conference call regarding BD's third quarter results and its expectations for the fourth quarter will be broadcast live on BD's website www.bd.com/investors at 10:00 a.m. (ET) Thursday, July 22, 2004. A replay of the conference call will be available on the investors page of BD's website or at 1-866-419-5473 (domestic) and 1-203-369-0771 (international) through July 29, 2004.
This news release contains certain non-GAAP financial measures. A reconciliation of these and other measures to the comparable GAAP measures is included in the attached financial tables.
BD is a medical technology company that serves healthcare institutions, life science researchers, clinical laboratories, industry and the general public. BD manufactures and sells a broad range of medical supplies, devices, laboratory equipment and diagnostic products. For the fiscal year ended September 30, 2003, BD reported total revenues of $4.528 billion.
***
This press release, including the section entitled "Fiscal 4Q 2004 Outlook," contains certain forward-looking statements (as defined under Federal securities laws) regarding BD's performance, including future revenues, products and income, or events or developments that BD expects to occur or anticipates occurring in the future. All such statements are based upon current expectations of BD and involve a number of business risks and uncertainties. Actual results could vary materially from anticipated results described, implied or projected in any forward-looking statement. Factors that could cause actual results to vary materially from any forward-looking statement include, but are not limited to: competitive factors; pricing and market share pressures; changes in interest or foreign currency exchange rates; changes in BD's sales volume and product mix; BD's ability to achieve its cost savings objectives; difficulties inherent in product development and delays in product introductions; changes in regional, national or foreign economic conditions; increases in energy costs; fluctuations in costs and availability of raw materials and in BD's ability to maintain favorable supplier arrangements and relationships; uncertainties of litigation; and changes in healthcare or other governmental regulation; issuance of new or revised accounting standards, as well as other factors discussed in this press release and in BD's filings with the Securities and Exchange Commission. We do not intend to update any forward-looking statements.
BECTON, DICKINSON AND COMPANY
CONSOLIDATED INCOME STATEMENTS
(Unaudited; Amounts in thousands, except per-share data)
Three Months Ended June 30,
2004 2003 % Change
REVENUES $1,257,755 $1,165,369 7.9
Cost of products sold 624,212 622,387 0.3
Selling and administrative 338,052 308,475 9.6
Research and development 60,800 60,042 1.3
Litigation settlement 100,000 - NM
TOTAL OPERATING COSTS
AND EXPENSES 1,123,064 990,904 13.3
OPERATING INCOME 134,691 174,465 (22.8)
Interest expense, net (4,128) (9,658) (57.3)
Other expense, net (701) (2,036) (65.6)
INCOME BEFORE
INCOME TAXES 129,862 162,771 (20.2)
Income tax provision 20,466 32,753 (37.5)
NET INCOME $109,396 $130,018 (15.9)
EARNINGS PER SHARE
Basic $0.43 $0.51 (15.7)
Diluted $0.41 $0.49 (16.3)
AVERAGE SHARES OUTSTANDING
Basic 252,433 255,038
Diluted 264,336 265,088
NM - Not Meaningful
BECTON, DICKINSON AND COMPANY
RECONCILIATION TO PRO FORMA AMOUNTS
Three Months Ended June 30,
(Unaudited)
2004
As Litigation Excluding
Reported Settlement** Charges
Diluted EPS $0.41 $0.24 $0.65
2003
As Non-cash Excluding
Reported Charges*** Charges
Diluted EPS $0.49 $0.08 $0.57
** Relates to the fiscal 2004 charge associated with the settlement of
litigation with Retractable Technologies, Inc.
*** Relates to the fiscal 2003 write-down of certain intangible assets
and inventory in the BD Biosciences segment.
BECTON, DICKINSON AND COMPANY
SUPPLEMENTAL INFORMATION
Three Months Ended June 30,
(Unaudited; Amounts in thousands)
2004
As Litigation Excluding
Reported Settlement** Charges
Operating Income $134,691 $100,000 $234,691
as a % of revenues 10.7% 18.7%
Net Income 109,396 63,000 172,396
as a % of revenues 8.7% 13.7%
2003
As Non-cash Excluding
Reported Charges*** Charges
Gross Profit $542,982 $34,231 $577,213
as a % of revenues 46.6% 49.5%
Operating Income 174,465 34,231 208,696
as a % of revenues 15.0% 17.9%
Net Income 130,018 20,196 150,214
as a % of revenues 11.2% 12.9%
** Relates to the fiscal 2004 charge associated with the settlement of
litigation with Retractable Technologies, Inc.
*** Relates to the fiscal 2003 write-down of certain intangible assets
and inventory in the BD Biosciences segment.
BECTON, DICKINSON AND COMPANY
CONSOLIDATED INCOME STATEMENTS
(Unaudited; Amounts in thousands, except per-share data)
Nine Months Ended June 30,
2004 2003 % Change
REVENUES $3,727,809 $3,351,058 11.2
Cost of products sold 1,903,145 1,750,854 8.7
Selling and administrative 1,006,300 891,454 12.9
Research and development 184,007 179,921 2.3
Litigation settlement 100,000 - NM
TOTAL OPERATING COSTS
AND EXPENSES 3,193,452 2,822,229 13.2
OPERATING INCOME 534,357 528,829 1.0
Interest expense, net (21,018) (26,944) (22.0)
Other (expense) income, net (3,865) (3,799) 1.7
INCOME BEFORE
INCOME TAXES 509,474 498,086 2.3
Income tax provision 109,516 112,390 (2.6)
NET INCOME $399,958 $385,696 3.7
EARNINGS PER SHARE
Basic $1.58 $1.51 4.6
Diluted $1.51 $1.46 3.4
AVERAGE SHARES OUTSTANDING
Basic 252,617 255,008
Diluted 264,008 263,995
NM - Not Meaningful
BECTON, DICKINSON AND COMPANY
RECONCILIATION TO PRO FORMA AMOUNTS
Nine Months Ended June 30,
(Unaudited)
2004
As BGM Litigation Excluding
Reported Charges* Settlement** Charges
Diluted EPS $1.51 $0.11 $0.24 $1.86
2003
As Non-cash Excluding
Reported Charges*** Charges
Diluted EPS $1.46 $0.08 $1.54
* Relates to the fiscal 2004 charge associated with blood glucose
monitoring (BGM) products.
** Relates to the fiscal 2004 charge associated with the settlement of
litigation with Retractable Technologies, Inc.
*** Relates to the fiscal 2003 write-down of certain intangible assets
and inventory in the BD Biosciences segment.
BECTON, DICKINSON AND COMPANY
SUPPLEMENTAL INFORMATION
Nine Months Ended June 30,
(Unaudited; Amounts in thousands)
2004
As BGM Litigation Excluding
Reported Charges* Settlement** Charges
Gross Profit $1,824,664 $45,024 $ - $1,869,688
as a % of revenues 48.9% 50.2%
Operating Income 534,357 45,024 100,000 679,381
as a % of revenues 14.3% 18.2%
Net Income 399,958 27,915 63,000 490,873
as a % of revenues 10.7% 13.2%
2003
As Non-cash Excluding
Reported Charges*** Charges
Gross Profit $1,600,204 $34,231 $1,634,435
as a % of revenues 47.8% 48.8%
Operating Income 528,829 34,231 563,060
as a % of revenues 15.8% 16.8%
Net Income 385,696 20,196 405,892
as a % of revenues 11.5% 12.1%
* Relates to the fiscal 2004 charge associated with blood glucose
monitoring (BGM) products.
** Relates to the fiscal 2004 charge associated with the settlement of
litigation with Retractable Technologies, Inc.
*** Relates to the fiscal 2003 write-down of certain intangible assets
and inventory in the BD Biosciences segment.
BECTON, DICKINSON AND COMPANY
SUPPLEMENTAL REVENUE INFORMATION
REVENUES BY SEGMENT AND GEOGRAPHIC AREA
(Unaudited; Amounts in thousands)
Three Months Ended June 30,
2004 2003 % Change
BD MEDICAL
United States $316,312 $306,036 3.4
International 366,333 342,392 7.0
TOTAL $682,645 $648,428 5.3
BD DIAGNOSTICS
United States $206,842 $190,888 8.4
International 167,353 147,295 13.6
TOTAL $374,195 $338,183 10.6
BD BIOSCIENCES
United States $93,456 $86,164 8.5
International 107,459 92,594 16.1
TOTAL $200,915 $178,758 12.4
TOTAL REVENUES
United States $616,610 $583,088 5.7
International 641,145 582,281 10.1
TOTAL $1,257,755 $1,165,369 7.9
BECTON, DICKINSON AND COMPANY
SUPPLEMENTAL REVENUE INFORMATION
REVENUES BY SEGMENT AND GEOGRAPHIC AREA
(Unaudited; Amounts in thousands)
Nine Months Ended June 30,
2004 2003 % Change
BD MEDICAL
United States $940,747 $895,256 5.1
International 1,051,407 926,628 13.5
TOTAL $1,992,154 $1,821,884 9.3
BD DIAGNOSTICS
United States $631,178 $588,626 7.2
International 526,837 438,011 20.3
TOTAL $1,158,015 $1,026,637 12.8
BD BIOSCIENCES
United States $255,802 $234,046 9.3
International 321,838 268,491 19.9
TOTAL $577,640 $502,537 14.9
TOTAL REVENUES
United States $1,827,727 $1,717,928 6.4
International 1,900,082 1,633,130 16.3
TOTAL $3,727,809 $3,351,058 11.2
BECTON, DICKINSON AND COMPANY
SUPPLEMENTAL REVENUE INFORMATION
REVENUES BY BUSINESS SEGMENTS AND UNITS
Three Months Ended June 30,
(Unaudited; Amounts in thousands)
United States
2004 2003 % Change
BD MEDICAL
Medical Surgical Systems $200,407 $190,831 5.0
Diabetes Care 85,693 81,329 5.4
Pharmaceutical Systems 24,382 28,029 (13.0)
Ophthalmic Systems 5,830 5,847 (0.3)
TOTAL $316,312 $306,036 3.4
BD DIAGNOSTICS
Preanalytical Systems $113,305 $102,869 10.1
Diagnostic Systems 93,537 88,019 6.3
TOTAL $206,842 $190,888 8.4
BD BIOSCIENCES
Discovery Labware $26,353 $25,053 5.2
Immunocytometry Systems 39,871 34,960 14.0
Clontech 8,076 8,091 (0.2)
Pharmingen 19,156 18,060 6.1
TOTAL $93,456 $86,164 8.5
TOTAL UNITED STATES $616,610 $583,088 5.7
BECTON, DICKINSON AND COMPANY
SUPPLEMENTAL REVENUE INFORMATION
REVENUES BY BUSINESS SEGMENTS AND UNITS
Three Months Ended June 30, (continued)
(Unaudited; Amounts in thousands)
International
% Change
FX FX
2004 2003 Reported Neutral Impact
BD MEDICAL
Medical Surgical Systems $188,824 $179,543 5.2 0.2 5.0
Diabetes Care 62,299 55,785 11.7 5.2 6.5
Pharmaceutical Systems 106,829 99,319 7.6 0.4 7.2
Ophthalmic Systems 8,381 7,745 8.2 (0.1) 8.3
TOTAL $366,333 $342,392 7.0 1.0 5.9
BD DIAGNOSTICS
Preanalytical Systems $88,640 $77,503 14.4 7.8 6.6
Diagnostic Systems 78,713 69,792 12.8 6.2 6.6
TOTAL $167,353 $147,295 13.6 7.0 6.6
BD BIOSCIENCES
Discovery Labware $21,397 $21,596 (0.9) (7.4) 6.5
Immunocytometry Systems 62,237 49,121 26.7 20.0 6.7
Clontech 6,858 7,720 (11.2) (17.1) 5.9
Pharmingen 16,967 14,157 19.8 11.6 8.3
TOTAL $107,459 $92,594 16.1 9.2 6.8
TOTAL INTERNATIONAL $641,145 $582,281 10.1 3.9 6.3
BECTON, DICKINSON AND COMPANY
SUPPLEMENTAL REVENUE INFORMATION
REVENUES BY BUSINESS SEGMENTS AND UNITS
Three Months Ended June 30, (continued)
(Unaudited; Amounts in thousands)
Total
% Change
FX FX
2004 2003 Reported Neutral Impact
BD MEDICAL
Medical Surgical Systems $389,231 $370,374 5.1 2.7 2.4
Diabetes Care 147,992 137,114 7.9 5.3 2.6
Pharmaceutical Systems 131,211 127,348 3.0 (2.6) 5.6
Ophthalmic Systems 14,211 13,592 4.6 (0.2) 4.7
TOTAL $682,645 $648,428 5.3 2.1 3.1
BD DIAGNOSTICS
Preanalytical Systems $201,945 $180,372 12.0 9.1 2.8
Diagnostic Systems 172,250 157,811 9.1 6.2 2.9
TOTAL $374,195 $338,183 10.6 7.8 2.9
BD BIOSCIENCES
Discovery Labware $47,750 $46,649 2.4 (0.7) 3.0
Immunocytometry Systems 102,108 84,081 21.4 17.5 3.9
Clontech 14,934 15,811 (5.5) (8.5) 2.9
Pharmingen 36,123 32,217 12.1 8.5 3.6
TOTAL $200,915 $178,758 12.4 8.9 3.5
TOTAL REVENUES $1,257,755 $1,165,369 7.9 4.8 3.1
BECTON, DICKINSON AND COMPANY
SUPPLEMENTAL REVENUE INFORMATION
REVENUES BY BUSINESS SEGMENTS AND UNITS
Nine Months Ended June 30,
(Unaudited; Amounts in thousands)
United States
2004 2003 % Change
BD MEDICAL
Medical Surgical Systems $595,344 $564,313 5.5
Diabetes Care 249,272 240,483 3.7
Pharmaceutical Systems 79,013 72,351 9.2
Ophthalmic Systems 17,118 18,109 (5.5)
TOTAL $940,747 $895,256 5.1
BD DIAGNOSTICS
Preanalytical Systems $329,396 $306,850 7.3
Diagnostic Systems 301,782 281,776 7.1
TOTAL $631,178 $588,626 7.2
BD BIOSCIENCES
Discovery Labware $74,233 $71,399 4.0
Immunocytometry Systems 104,768 87,300 20.0
Clontech 23,163 24,353 (4.9)
Pharmingen 53,638 50,994 5.2
TOTAL $255,802 $234,046 9.3
TOTAL UNITED STATES $1,827,727 $1,717,928 6.4
BECTON, DICKINSON AND COMPANY
SUPPLEMENTAL REVENUE INFORMATION
REVENUES BY BUSINESS SEGMENTS AND UNITS
Nine Months Ended June 30, (continued)
(Unaudited; Amounts in thousands)
International
% Change
FX FX
2004 2003 Reported Neutral Impact
BD MEDICAL
Medical Surgical Systems $552,210 $492,978 12.0 2.6 9.4
Diabetes Care 181,814 150,008 21.2 9.0 12.2
Pharmaceutical Systems 292,773 262,048 11.7 (0.8) 12.5
Ophthalmic Systems 24,610 21,594 14.0 2.5 11.5
TOTAL $1,051,407 $926,628 13.5 2.7 10.8
BD DIAGNOSTICS
Preanalytical Systems $253,472 $216,782 16.9 5.5 11.4
Diagnostic Systems 273,365 221,229 23.6 12.5 11.0
TOTAL $526,837 $438,011 20.3 9.1 11.2
BD BIOSCIENCES
Discovery Labware $66,953 $60,511 10.6 (0.2) 10.8
Immunocytometry Systems 183,047 144,313 26.8 15.6 11.3
Clontech 22,911 24,501 (6.5) (15.5) 9.0
Pharmingen 48,927 39,166 24.9 11.7 13.2
TOTAL $321,838 $268,491 19.9 8.6 11.3
TOTAL INTERNATIONAL $1,900,082 $1,633,130 16.3 5.4 11.0
BECTON, DICKINSON AND COMPANY
SUPPLEMENTAL REVENUE INFORMATION
REVENUES BY BUSINESS SEGMENTS AND UNITS
Nine Months Ended June 30, (continued)
(Unaudited; Amounts in thousands)
Total
% Change
FX FX
2004 2003 Reported Neutral Impact
BD MEDICAL
Medical Surgical Systems $1,147,554 $1,057,291 8.5 4.1 4.4
Diabetes Care 431,086 390,491 10.4 5.7 4.7
Pharmaceutical Systems 371,786 334,399 11.2 1.4 9.8
Ophthalmic Systems 41,728 39,703 5.1 (1.1) 6.2
TOTAL $1,992,154 $1,821,884 9.3 3.9 5.5
BD DIAGNOSTICS
Preanalytical Systems $582,868 $523,632 11.3 6.6 4.7
Diagnostic Systems 575,147 503,005 14.3 9.5 4.9
TOTAL $1,158,015 $1,026,637 12.8 8.0 4.8
BD BIOSCIENCES
Discovery Labware $141,186 $131,910 7.0 2.1 5.0
Immunocytometry Systems 287,815 231,613 24.3 17.2 7.0
Clontech 46,074 48,854 (5.7) (10.2) 4.5
Pharmingen 102,565 90,160 13.8 8.0 5.7
TOTAL $577,640 $502,537 14.9 8.9 6.0
TOTAL REVENUES $3,727,809 $3,351,058 11.2 5.9 5.3
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