Stryker Corporation · NYSE:SYK
Stryker — 35th Annual J.P. Morgan Healthcare Conference (January 2017)
18 slides from Stryker's conference presentation, Jan 11, 2017
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
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: Diverse global medtech leader
Diverse global medtech leader Neuro Powered Instruments 3% Pursuing global Neurovascular CMF Knees 5% 2% 13% Spine market leadership 7% Sustainability Hips Solutions 2% 11% in three segments 2016 Net Sales $11.3B Medical 15% Trauma & Extremities 12% Other Endoscopy 3% 13% Instruments 14%
Slide 5: Culture of growth
Culture of growth 12 Net Sales ($B) 11.3 10 8 6 4 2 0 79 2016
Slide 6: Growth at the high end of Medtech
Growth at the high end of Medtech 7.0% 6.4% Organic Sales Growth 6.1% 6.0% 5.8% ~4.8% 5.0% 4.6% 4.0% 2.9% 3.0% 2.0% 1.0% 0.0% 2014 2015 2016 Medtech Market* Stryker *Medtech market growth has been compiled by Stryker from financial information and published guidance reported by industry competitors
Slide 7: Delivering leveraged earnings
Delivering leveraged earnings 14.0% 13.3% 12.0% 12.3% 10.0% 8.2% 8.0% 6.1% 6.4% 5.8% 6.0% 5.3% 4.0% 2.0% 0.0% 2014 2015 2016 Organic Sales Growth Adj Diluted EPS Growth* *Adjusted diluted EPS growth bar for 2016 corresponds with our previously provided EPS range.
Slide 8: 2016 preliminary results
2016 preliminary results FY2016 + 6.4% Organic sales growth $5.75 to $5.80 Adjusted net earnings per diluted share expected to come in at the high end of our previously stated range of $5.75 to $5.80. Full year negative FX impact of approximately $0.10 to $0.12 per share 4Q negative FX impact of app
Slide 9: Stryker's core strategies
Stryker’s core strategies • Business unit specialization • Acquisitions • International growth • Cost transformation for growth
Slide 10: Business unit specialization
Business unit specialization • Enables critical link between customers, sales & marketing, R&D and BD • Key to driving market share gains and category leadership • Long history of building specialized sales forces focused on surgeon specialties • Driving innovation with R&D spending >6% of sales
Slide 11: Business outlook in 2017
Business outlook in 2017 • Market leading growth in Orthopaedics: 2016: net sales $4,422M, organic sales growth 4.8% • Mako total knee launch • Expanding Tritanium 3D printed product portfolio • Continued extremities market expansion and share gain • Continue category leadership in MedSurg: 2016: ne
Slide 12: Mergers and acquisitions
Mergers and acquisitions Color key: ‐ Capital allocation prioritizes M&A, then dividends and buybacks Core business ‐ Focus on core and key adjacent markets to drive category leadership Adjacency Synergetics USA’s Neuro Ivy Sports Portfolio Medicine, LLC Concentric Patient Safety Vertebral Compressi
Slide 13: Capital deployment
Capital deployment M&A to drive sales growth and innovation Dividends $1.6B Focused on driving sales growth in core and adjacent markets 2014-2016 Dividend growth Share Capital Per Share Dividend CAGR of 15% since 2012 Repurchases $0.8B Deployment Committed to increasing the dividend in‐line with ad
Slide 14: International growth
International growth New global operating model driving focus and results • Strong European momentum continued in 2016 • Canada growth accelerating EM challenges continue but long‐term opportunity remains compelling • China returned to growth in Q4 • Launch of mid‐tier products continues • More focu
Slide 15: Cost transformation for growth
Cost transformation for growth • Product line rationalization • Indirect procurement • Common ERP platform • Expansion of shared services • Geographic rationalization • Continued plant network optimization
Slide 16: 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 17: Summary
Summary • Talented and experienced leadership across all divisions • Driving strong organic sales growth, consistently • Focused on innovation & acquisitions • Enhancing global presence through focus and alignment • Delivering leveraged earnings gains • Effectively deploying capital to enhance share
Slide 18: Appendix A
Appendix A SUPPLEMENTAL INFORMATION ‐ RECONCILIATION OF GAAP TO 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 sa
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