Stryker Corporation · NYSE:SYK
Stryker — Bank of America Merrill Lynch 2015 Health Care Conference
16 slides from Stryker's conference presentation, May 12, 2015
Slide 1: Stryker
STRYKER William R. Jellison Vice President, Chief Financial Officer May 12, 2015
Slide 2: Forward Looking Statement
FORWARD LOOKING STATEMENT Certain statements made in the presentation may contain 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 mat
Slide 3: Mission
MISSION TOGETHER WITH OUR CUSTOMERS, WE ARE DRIVEN MISSION TO MAKE HEALTHCARE BETTER. VALUES INTEGRITY ACCOUNTABILITY PEOPLE PERFORMANCE We do what’s right We do what we say We grow talent We deliver 3
Slide 4: Global MedTech Leader
GLOBAL MEDTECH LEADER Neuro Powered Instruments • Pursuing global market 3% CMF Knees 2% 14% leadership in three Neurovascular 5% segments Spine 8% Hips 13% Sustainability Solutions 2% 2014 Sales • Growing through Medical 8% $9.7B business unit Trauma & Extremities 13% specialization Endoscopy 14% O
Slide 5: History of Performance
HISTORY OF PERFORMANCE 9.7B 10 Sales ($B) 9 8 7 6 5 4 3 2 1 0 79 14 Adjusted Diluted Net EPS* ($) Dividends Paid Per Share ($) 6.00 1.50 4.49 4.73 1.22 5.00 3.94 4.30 1.06 4.00 1.00 0.85 0.72 3.00 0.60 2.00 0.50 1.00 0.00 0.00 11 12 13 14 10 11 12 13 14 * Non-GAAP financial measure. See the reconcil
Slide 6: Growth at the High End of MedTech
GROWTH AT THE HIGH END OF MEDTECH 7.0% Organic Revenue Growth* 5.8% 5.0 - 6.0% 6.0% 5.1% 5.0% 4.2% 4.0% 3.0% 2.6% 2.8% 2.4% 2.0% 1.0% 0.0% 2012 2013 2014 2015E MedTech Market** Stryker * Removes the impact of changes in foreign currency exchange rates, divestitures (not applicable to Stryker) and th
Slide 7: Key Growth Drivers
KEY GROWTH DRIVERS Mako Partial Knee Drive market adoption of Arthroplasty (PKA) Mako Total Hip Arthroplasty (THA) robotic-arm assisted surgery Expand portfolio and selling teams in high growth segments - Extremities, Neurotechnology, Sports Medicine Accelerating regional growth - Europe & Trans-Atl
Slide 8: Focused on Innovation
FOCUSED ON INNOVATION • Demonstrating commitment to internal innovation +12% 4 Year CAGR R&D* Nearly 2x the MedTech • Driving innovation with average R&D CAGR** products and services • Focused on improved outcomes & delivering greater cost savings/efficiencies * 4 year CAGR is for periods 2011 – 201
Slide 9: Operating Leverage Initiatives
OPERATING LEVERAGE INITIATIVES • Amplify the GQ&O cost reduction program • Reduce inventories through product rationalization • Drive SG&A savings via shared services • Simplify and rationalize our information technology footprint 9
Slide 10: Continued Strength Through M&A
CONTINUED STRENGTH THROUGH M&A Ascent Patient Safety Technologies Porex Concentric OtisMed Trauson Pivot Medical CHG Hospital Beds Orthovita 2009 2010 2011 2012 2013 2014 2015 Memometal MAKO Gaymar Small Bone Surpass Innovations Sonopet Berchtold Holding Neurovascular • Targeting core and key adjace
Slide 11: Capital Deployment
CAPITAL DEPLOYMENT • M&A to drive sales growth and innovation Focused on driving sales growth in core and adjacent markets Guidelines: - generally to exceed cost of capital by year 3 - target 12.5% + IRR • Dividend growth Dividend per share CAGR of 20% since 2010 Committed to increasing the dividend
Slide 12: Stryker Advantage
STRYKER ADVANTAGE POSITIONED WELL FOR THE FUTURE • Global MedTech leader • Focused on innovation • Accelerating global growth • Opportunities to drive operational leverage • Healthy cash flow and balance sheet 12
Slide 13: Stryker
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Slide 14: Appendix
STRYKER Appendix 14
Slide 15: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES We supplement the reporting of our financial information determined under 1. Acquisition and integration related costs. Costs related to integrating accounting principles generally accepted in the United States (GAAP) with certain recently acquired businesses and specific
Slide 16: Reconciliation of GAAP to Non-GAAP Results
RECONCILIATION OF GAAP TO NON-GAAP RESULTS (Per Share Amounts) 2011 2012 2013 2014 Diluted Net Earnings per Share $3.45 $3.39 $2.63 $1.34 Acquisition and integration related charges 0.37 0.09 0.19 0.17 Amortization of intangible assets 0.22 0.23 0.26 0.35 Restructuring and related charges 0.16 0.15
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