Baxter International Inc. · NYSE:BAX
Baxter International — Q1 2024 Earnings Presentation
30 slides from Baxter International's earnings presentation, May 2, 2024
Slide 1: First-Quarter 2024 Earnings
F I R S T - Q UA R T E R 2 0 24 E A R N I N G S Baxter International Inc. May 2, 2024 1
Slide 2: Forward-Looking Statements
FO RWA R D - LO O K I N G S TAT E M E N T S This presentation includes forward-looking statements concerning the company’s financial results (including the outlook for second-quarter and full-year 2024) and business development and regulatory activities. These forward-looking statements are based on
Slide 3: Use of Non-GAAP Financial Measures
USE OF NON-GAAP FINANCIAL MEASURES To supplement Baxter’s consolidated financial statements presented on a U.S. GAAP basis, the company discloses certain non-GAAP financial measures. These non-GAAP financial measures are not in accordance with generally accepted accounting principles in the United S
Slide 4: Table of Contents
TA B L E O F C O N T E N T S Performance Summary 5 Financial Results 12 2024 Outlook 17 Non-GAAP Reconciliations 21 4
Slide 5: Performance Summary
P E R FO R M A N C E S U M M A RY First-Quarter 2024 Earnings May 2, 2024 5
Slide 6: Executing on Our Strategy for Value Creation
E X E C U T I N G O N O U R S T R AT E GY FO R VA LU E C R E AT I O N RECENT HIGHLIGHTS Q1 2024 Results1 Constant currency sales increased 3% exceeding previously announced guidance, driven by better-than-expected results in Pharmaceuticals, Medical Products & Therapies and Kidney Care. Growth in
Slide 7: Performance Highlights
P E R FO R M A N C E H I G H L I G H T S C O N T I N U I N G O P E R AT I O N S 1 First-Quarter 2024 $3.6B +2% Reported +3% Constant Currency 2 Sales Key Metrics GAAP Adjusted3 Gross Margin 38.6% 42.5% YOY Change +230 bps +170 bps Operating Margin 5.2% 14.3% YOY Change +150 bps +180 bps Diluted EPS
Slide 8: Key Financial Metrics
KEY FINANCIAL METRICS F I R S T - Q U A R T E R 2 0 2 4 S N A P S H O T ( C O N T I N U I N G O P E R AT I O N S ) 1 Global Reported Sales Adjusted Operating Margin Adjusted Diluted EPS 14.3% $0.65 $3.5B $3.6B 12.5% $0.49 +3% Constant Growth 2 +180 bps +33% Q1 2023 Q1 2024 Q1 2023 Q1 2024 Q1 2023 Q1
Slide 9: First-Quarter 2024 Adjusted Financial Results
F I R S T- Q UA R T E R 2 0 24 A DJ U S T E D F I N A N C I A L R E S U LT S 1 ( C O N T I N U I N G O P E R AT I O N S ) Q1 2023 Q1 2024 Change Adjusted Gross Margin 40.8% 42.5% +170 bps Adjusted SG&A Expense 23.8% 23.8% +0 bps (% of Sales) Adjusted R&D Expense 4.5% 4.5% +0 bps (% of Sales) Adjuste
Slide 10: First-Quarter Performance versus Guidance
F I R S T- Q UA R T E R 2 0 24 P E R FO R M A N C E 1 ( C O N T I N U I N G O P E R AT I O N S ) Metric Q1 2024 Q1 2024 Guidance Actual Sales Growth ~1% +2% Reported Sales Growth 1% - 2% +3% Constant Currency GAAP Diluted EPS N/A $0.07 Growth vs. Prior-Year Period NM2 Adjusted Diluted EPS $0.59 - $0
Slide 11: Portfolio Management Actions and Capital Allocation Strategy
E X E C U T I N G P O R T FO L I O M A N AG E M E N T AC T I O N S TO AC C E L E R AT E D I S C I P L I N E D C A P I TA L A L LO C AT I O N S T R AT E GY PORTFOLIO SHARE MANAGEMENT DEBT REPAYMENT DIVIDENDS REPURCHASES Disciplined portfolio management Taking actions towards achieving Continued commi
Slide 12: Financial Results by Operating Segment
F I N A N C I A L R E S U LT S BY O P E R AT I N G S E G M E N T First-Quarter 2024 Earnings May 2, 2024 12
Slide 13: First-Quarter Sales by Product Category
F I R S T- Q UA R T E R 2 0 24 S A L E S BY P RO D U C T C AT E G O RY 1 Q1 2024 Revenue Total Growth $ In Millions U.S. International Total Reported Constant Infusion Therapies & Technologies $526 $440 $966 +6% +6% Advanced Surgery $147 $116 $263 +7% +8% Medical Products & Therapies $673 $556 $1,22
Slide 14: First-Quarter Business Drivers
F I R S T- Q UA R T E R 2 0 24 B U S I N E S S D R I V E R S 1 Product Category Sales CC Growth2 Quarterly Performance Drivers Infusion Therapies & Sales in the quarter benefited from strong growth internationally across the division, including in IV solutions, $966M +6% nutrition and infusion syste
Slide 15: First-Quarter Segment Results
F I R S T- Q UA R T E R 2 0 24 S E G M E N T R E S U LT S Q1 2024 Results1 Segment Segment Reported Reported Constant Operating Operating YoY Margin $ In Millions Revenue Growth Growth Income Margin Change2 Medical Products & Therapies $1,229 +6% +6% $227 18.5% +150 bps Healthcare Systems & $667 (9%
Slide 16: First-Quarter Results
F I R S T- Q UA R T E R 2 0 24 R E S U LT S 1 Q1 2024 Results Adjusted Adjusted Reported Reported Constant Operating Operating YoY Margin $ In Millions Revenue Growth Growth Income Margin Change2 Total Baxter $3,592 +2% +3% $515 14.3% +180 bps 1Non-GAAP financial metrics referenced in this slide inc
Slide 17: 2024 Outlook
2 0 24 O U T LO O K First-Quarter 2024 Earnings May 2, 2024 17
Slide 18: Second-Quarter Guidance
S E C O N D - Q UA R T E R 2 0 24 G U I DA N C E 1 Q2 2024 Guidance Sales Growth ~1% Reported Foreign Exchange >100 bps Sales Growth 2% - 3% Constant Currency Adjusted Diluted EPS $0.65 - $0.67 1Non-GAAP financial metrics referenced in this slide include constant currency sales growth and adjusted d
Slide 19: Full-Year 2024 Guidance
F U L L -Y E A R 2 0 24 G U I DA N C E 1 FY 2024 Guidance Sales Growth ~2% Reported Foreign Exchange ~50 bps Sales Growth 2% - 3% Constant Currency Adjusted Diluted EPS $2.88 - $2.98 1Non-GAAP financial metrics referenced in this slide include constant currency sales growth and adjusted diluted EPS.
Slide 20: Full-Year 2024 Guidance by Segment
F U L L -Y E A R 2 0 24 G U I DA N C E BY S E G M E N T 1 Sales Growth FY 2024 Constant Currency Guidance Medical Products & Therapies 4% - 5% Healthcare Systems & Technologies ~0% Pharmaceuticals 6% - 7% Baxter (Excluding Kidney Care) 3% - 4% Kidney Care 0% - 1% Total Baxter 2% - 3% 1Non-GAAP finan
Slide 21: Non-GAAP Reconciliations
NON-GAAP R E C O N C I L I AT I O N S First-Quarter 2024 Earnings May 2, 2024 21
Slide 22: Non-GAAP Reconciliations as of May 2, 2024
NON-GAAP RECONCILIATIONS AS OF MAY 2, 2024 Non-GAAP Reconciliations: As part of its Q1 2024 earnings announcement on May 2, 2024, Baxter presented its financial results for the first quarter of 2024. Baxter also presented guidance for the second quarter and full year of 2024. In these presentations,
Slide 23: Reconciliations of U.S. GAAP to Non-GAAP Measures, Q1 2024
DESCRIPTION OF ADJUSTMENTS AND RECONCILIATIONS OF U.S. GAAP TO NON-GAAP MEASURES Three Months Ended March 31, 2024 (unaudited) (in millions, except per share and percentage data) The company’s U.S. GAAP results for the three months ended March 31, 2024 included special items which impacted the U.S.
Slide 24: Reconciliations of U.S. GAAP to Non-GAAP Measures, Q1 2023
DESCRIPTION OF ADJUSTMENTS AND RECONCILIATIONS OF U.S. GAAP TO NON-GAAP MEASURES Three Months Ended March 31, 2023 (unaudited) (in millions, except per share and percentage data) The company’s U.S. GAAP results for the three months ended March 31, 2023 included special items which impacted the U.S.
Slide 25: Description of Adjustments, Three Months Ended March 31, 2024 and 2023
DESCRIPTION OF ADJUSTMENTS AND RECONCILIATIONS OF U.S. GAAP TO NON-GAAP MEASURES Three Months Ended March 31, 2024 and 2023 (unaudited) 1. The company’s results in 2024 and 2023 included costs related to programs to optimize its organization and cost structure. In 2024, these costs primarily related
Slide 26: Operating Cash Flow to Free Cash Flow
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE Operating Cash Flow to Free Cash Flow (unaudited) (in millions) Three Months Ended March 31, 2024 2023 Cash flows from operations – continuing operations $ 163 $ 469 Cash flows from investing activities - continuing operations (166) (163) Cash flows from
Slide 27: Net Sales Growth As Reported to Constant Currency
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE Change in Net Sales Growth As Reported to Constant Currency Sales Growth From The Three Months Ended March 31, 2023 to The Three Months Ended March 31, 2024 (unaudited) Sales By Product Category: Net Sales Growth Constant Currency Sales As Reported FX Gro
Slide 28: Projected Sales Growth Reconciliation, Q2 and FY 2024
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE Projected Second Quarter and Full Year 2024 U.S. GAAP Sales Growth to Projected Constant Currency Sales Growth and Full Year 2024 U.S. GAAP Sales Growth to Projected Constant Currency Sales Growth by Segment (unaudited) Sales Growth Guidance Q2 2024* FY 2
Slide 29: Projected Adjusted Operating Margin, Tax Rate and EPS
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE Projected Full Year 2024 Projected Adjusted Operating Margin, Projected Full Year 2024 Projected Adjusted Tax Rate and Projected Second Quarter and Full Year 2024 Projected Adjusted Earnings Per Share (unaudited) Adjusted Operating Margin Expansion FY 202
Slide 30: First-Quarter 2024 Earnings
F I R S T - Q UA R T E R 2 0 24 E A R N I N G S Baxter International Inc. May 2, 2024 30