Stryker Corporation · NYSE:SYK
Stryker — 36th Annual J.P. Morgan Healthcare Conference (January 2018)
18 slides from Stryker's conference presentation, Jan 10, 2018
Slide 1: Stryker
Stryker Kevin A. Lobo Chairman and Chief Executive Officer
Slide 2: Disclaimer
Disclaimer Forward-looking statement This presentation contains information that includes or is based on forward-looking statements within the meaning of the federal securities law that are subject to various risks and uncertainties that could cause our actual results to differ materially from those
Slide 3: Mission and Values
Mission Together with our customers, we are driven to make healthcare better. Values Integrity Accountability People Performance We do what’s right We do what we say We grow talent We deliver
Slide 4: Our company strategy
Our company strategy Drive market leading growth and achieve category leadership in MedSurg Equipment, Orthopaedics, and Neurotechnology/Spine Customer focus Innovation Globalization Cost transformation • Intense customer • Make healthcare better • Focus resources, investment • Drive operational eff
Slide 5: Diverse global medtech leader
Diverse global medtech leader Neuro Powered Instruments 4% CMF Knees Neurovascular 13% 5% 2% Spine 6% Sustainability Hips Solutions 2% 10% 2017 Net Sales Medical $12.4B 16% Trauma & Extremities 12% Other 3% Endoscopy 13% Instruments 14%
Slide 6: Culture of growth
Culture of growth Net sales ($B) $12.4 $12 $10 $8 $6 $4 $2 $0 '79 2017
Slide 7: Growth at the high end of Medtech
Growth at the high end of Medtech Organic Sales Growth 8.0% 7.1% 7.0% 6.4% 6.1% 6.0% 5.8% 5.0% 4.8% 4.6% ~4.5% 4.0% 2.9% 3.0% 2.0% 1.0% 0.0% 2014 2015 2016 2017 Medtech Market* Stryker *Medtech market growth has been compiled by Stryker from financial information and published guidance reported by i
Slide 8: Delivering leveraged earnings
Delivering leveraged earnings 14.0% 13.3% 12.1% 12.0% 11.2% 10.0% 8.2% 8.0% 7.1% 6.4% 6.1% 5.8% 6.0% 5.3% 4.0% 2.0% 0.0% 2014 2015 2016 2017 Organic Sales Growth Adj Diluted EPS Growth* *Adjusted diluted EPS growth bar for 2017 corresponds with our previously provided EPS range.
Slide 9: 2017 Preliminary results
2017 Preliminary results FY2017 + 7.1% Organic sales growth $6.45 to $6.50 Adjusted EPS expected to be in line with latest guidance 2017 Highlights • Mako ramping, MedSurg product cycles, Neuro market expansion • Well-balanced growth across regions • Acquisition momentum continues, e.g. Novadaq and
Slide 10: Business outlook in 2018
Business outlook in 2018 Continued market leading growth in Orthopaedics: 2017: net sales $4,713M, organic sales growth 6.2% • Ramping penetration for Mako total knee, in first full year post-launch • Full launch of 3D-printed Acetabulm for hips • Driving market adoption of cementless knees, now app
Slide 11: Business outlook in 2018
Business outlook in 2018 MedSurg momentum continues: 2017: net sales $5,558M, organic sales growth 7.8% • Endoscopy broadens video offering with NOVADAQ • Instruments System 8 power tool in first full year post-launch • Medical poised for growth with Sage recovery and Physio new product cycle • Favo
Slide 12: Business outlook in 2018
Business outlook in 2018 High growth in Neurotechnology & Spine: 2017: net sales $2,174M, organic sales growth 7.6% • Ischemic stroke market continues to expand, bolstered by clinical data • Market leading growth in neuro powered instruments and CMF • Entellus expands ENT portfolio • Core spine rema
Slide 13: Mergers and acquisitions
Mergers and acquisitions Color key: Acquisitions continue to contribute to organic sales Core business growth at the high end of med tech Adjacency Pending Synergetics Ivy Sports USA’s Neuro Medicine, Portfolio LLC Patient Safety Vertebral Compression NOVADAQ Technologies Fracture Portfolio from BD
Slide 14: Capital deployment
Capital deployment M&A to drive sales growth and innovation Dividends $1.7B Focused on driving sales growth in core and adjacent markets 2015-2017 Dividend growth Share Capital Committed to increasing the dividend in-line with adjusted EPS growth Repurchases $0.9B Deployment History Share repurchase
Slide 15: Cost transformation for growth
Cost transformation for growth • Product lifecycle management well underway • Executing obsolescence plans to reduce thousands of SKUs • 2018 will be another year of investing in inventory for replacements, but mix shift benefits are beginning • Indirect procurement progress continues • Meaningful r
Slide 16: Cost transformation for growth
Cost transformation for growth • Shared services expanding • Finance shared services process design work largely complete • HR shared services on track, beginning with mid-2018 system implementation • Geographic prioritization on track • Executing country exit strategy to shift footprint from 100+ c
Slide 17: Long-term sustainable financial targets
Long-term sustainable financial targets Sales growth at the high end of Sales growth med tech, which allows us to drive… EPS 30 to 50 basis points of annual growth Operating operating income improvement over leverage the next 5 years, resulting in … Financial EPS growth of at least 9% annually effic
Slide 18: Non-GAAP financial measures
Non-GAAP financial measures We supplement the reporting of our financial information determined under accounting principles generally accepted in the United States (GAAP) with certain non-GAAP financial measures, including percentage sales growth in constant currency; percentage sales growth in cons
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