Becton, Dickinson and Company · NYSE:BDX

Becton, Dickinson and — Q3 FY2016 Earnings Presentation

31 slides from Becton, Dickinson and's earnings presentation, Aug 4, 2016

  1. Slide 1: Third Quarter Results Fiscal Year 2016

    Third Quarter Results Fiscal Year 2016 August 4, 2016 © 2016 BD. BD, the BD Logo and all other trademarks are property of Becton, Dickinson and Company.

  2. Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures

    Forward-Looking Statements • These materials include forward-looking statements and it’s possible that actual results could differ from our expectations. Factors that could cause such differences appear in our third quarter earnings release and in our recent SEC filings. Non-GAAP Financial Measures

  3. Slide 3: Executive Overview

    Executive Overview Vincent A. Forlenza Chairman, CEO and President

  4. Slide 4: Q3 FY 2016 Business Highlights

    Q3 FY 2016 Business Highlights  Solid Q3 results  Performance from both segments driving solid organic revenue growth and strong EPS  Significant operating efficiencies driving third quarter operating margin expansion  Increasing key strategic investments in R&D  Confidence in FY 2016 guidance

  5. Slide 5: Q3 FY 2016 Financial Highlights

    Q3 FY 2016 Financial Highlights Third Quarter Year-to-Date Comparable Comparable As FXN FXN $ Growth % FXN $ Growth % FXN Adjusted Growth% Growth% Growth% Growth% Revenues $3,200 2.2% 3.1% 4.0% $9,263 28.0% 32.2% 3.7% (1) EPS $2.35 14.6% 19.5% N/A $6.48 24.1% 33.9% N/A  Strong Q3 EPS of $2.35 and 1

  6. Slide 6: Financial Update

    Financial Update Christopher Reidy Chief Financial Officer and Executive Vice President of Administration

  7. Slide 7: FY 2016 Adjusted Revenues by Segment

    FY 2016 Adjusted Revenues by Segment Third Quarter Year-to-Date Comparable Comparable FXN FXN As Adjusted $ Growth % FXN $ Growth % FXN Growth% Growth% Growth% Growth% Total $3,200 2.2% 3.1% 4.0%(1) $9,263 28.0% 32.2% 3.7% Revenues Medical 2,237 1.1% 1.9% 3.0% 6,431 46.5% 50.8% 3.7% Life Sciences 96

  8. Slide 8: FY 2016 Adjusted U.S. and International Revenues

    FY 2016 Adjusted U.S. and International Revenues Third Quarter Year-to-Date Comparable Comparable FXN FXN As Adjusted $ Growth % FXN $ Growth % FXN Growth% Growth% Growth% Growth% U.S. $1,737 1.8% 1.8% 3.4% $5,156 49.5% 49.5% 3.5% Medical 1,309 1.4% 1.4% 3.4% 3,862 75.9% 75.9% 3.6% Life Sciences 428

  9. Slide 9: FY 2016 Developed & Emerging Markets

    FY 2016 Developed & Emerging Markets Third Quarter Year-to Date % of BD Comparable % of BD Comparable As Adjusted $ $ Revenues FXN Growth % Revenues FXN Growth % Developed $2,715 85% 3.7% $7,870 85% 3.5% Markets Emerging $485 15% 5.2% $1,393 15% 4.2% Markets China $170 5% 9.5% $496 5% 7.8% Note: Eme

  10. Slide 10: FY 2016 Safety Revenues

    FY 2016 Safety Revenues Third Quarter Year-to-Date Comparable FXN FXN $ Growth % $ Growth % FXN Growth% Growth% Growth% Total Safety $784 7.6% 8.9% $2,254 21.7% 25.9% 6.8% By Geography U.S. 450 5.3% 5.3% 1,340 30.1% 30.1% 4.6% International 334 10.8% 13.9% 914 11.1% 20.7% 10.1% By Segment Medical 49

  11. Slide 11: Q3 FY 2016 Adjusted Income Statement

    Q3 FY 2016 Adjusted Income Statement Favorable (Unfavorable) Adjusted Q3 Adjusted Q3 FXN % $ Change % Change FY 2016 FY 2015 Change Revenues $3,200 $3,133 $67 2.2% 3.1% Organic Growth 4.0%(1) Gross Profit 1,684 1,615 69 4.3% 6.3% % of Revenues 52.6% 51.5% SSG&A 728 748 21 2.7% 1.9% % of Revenues 22.

  12. Slide 12: Q3 FY 2016 Adjusted Margin Changes Year-Over-Year

    Q3 FY 2016 Adjusted Margin Changes Year-Over-Year Gross Profit (% of sales) 1.6% (0.5%) 52.6% 51.5% Q3 2015 Performance Currency Q3 2016 Operating Margin (% of sales) 2.1% (0.6%) 23.4% 21.9% Q3 2015 Performance Currency Q3 2016  ~280 bps underlying operating margin expansion through Q3 YTD Note: Un

  13. Slide 13: Guidance

    Guidance Christopher Reidy Chief Financial Officer Executive Vice President of Administration

  14. Slide 14: FY 2016 Adjusted Revenue Guidance

    FY 2016 Adjusted Revenue Guidance FY15-16 Adjusted Quarterly Revenues 10.0% ~7% Q4’16 $3,229 Comparable $3,184 $3,155 Organic $3,133 $3,121 Revenue Growth $3,067 % FXN $3,048 0.0% Q1'15 Q1'16 Q2'15 Q2'16 Q3'15 Q3'16 Q4'15 Q4'16 Actuals Actuals Actuals Actuals Actuals Actuals Actuals Forecast FXN FXN

  15. Slide 15: FY 2016 Adjusted EPS Guidance

    FY 2016 Adjusted EPS Guidance $9.08 to ~1% $9.15 $8.73 to ~4% FXN +7₵ $8.80 +28₵ FXN $8.50 to ~22% $8.57 (7%) (1%) 9% to ~3% 10% (~1%) $6.40 to $6.47 FY15 BDX BDX Tax Rate Pension Operational FY16 February August FY16 May August FY16 Legacy Legacy Improvement Impact Accretion Adjusted FXN FXN Adjust

  16. Slide 16: FY 2016 Guidance

    FY 2016 Guidance As Adjusted May Guidance August Update Total Revenues – FXN 24.5% to 25.0% 24.5% to 25.0% Note: Guidance Total Revenues – Rptd 21.5% to 22.0% 21.0% to 21.5% updates denoted in bold. Medical Revenues – FXN 36.0% to 36.5% 36.0% to 36.5% Comparable Organic 4.5% to 5.0% 4.5% to 5.0% Tot

  17. Slide 17: Executive Overview

    Executive Overview Vincent A. Forlenza Chairman, CEO and President

  18. Slide 18: Q3 FY2016 Business Update: Growth and Strategic Initiatives

    Q3 FY2016 Business Update: Growth and Strategic Initiatives • 100+ hospitals implemented interoperability for New Product Alaris™ System infusion pump platform Innovation • Introduction of BD FACSMelody™ cell sorter • Submitting HPV assay for BD Max™ to FDA Strategic / • Creation of Respiratory Solu

  19. Slide 19: Q3 FY2016 Business Update: Operational Efficiencies

    Q3 FY2016 Business Update: Operational Efficiencies • G&A functional transformation continues: – Expanding and leveraging Global Shared Services (GSS) and Centers of Excellence (CoE) Operational – Focus on lean and efficient end-to-end processes Efficiencies • Continued manufacturing footprint optim

  20. Slide 20: Key Takeaways

    Key Takeaways  Solid Q3 results  Good performance from both segments highlights our diverse geographic and product portfolio  Significant operating efficiencies driving third quarter operating margin expansion  Increasing key strategic investments in R&D  Confidence in FY 2016 guidance 20

  21. Slide 21: Advancing the World of Health

    Advancing the World of Health

  22. Slide 22: Q3 FY 2016 & FY 2015 Adjustment Reconciliations

    Q3 FY 2016 & FY 2015 Adjustment Reconciliations (Unaudited; Amounts in millions, except per share data) Three Months Ended June 30, 2016 Selling and Research and Acquisitions and Diluted Administrative Development other Operating Other Expense, Income Tax Earnings Revenues Gross Profit Expense Expen

  23. Slide 23: Q3 YTD FY 2016 & FY 2015 Adjustment Reconciliations

    Q3 YTD FY 2016 & FY 2015 Adjustment Reconciliations (Unaudited; Amounts in millions, except per share data) Nine Months Ended June 30, 2016 Selling and Research and Acquisitions and Diluted Administrative Development other Operating Other Income, Income Tax Earnings Revenues Gross Profit Expense Exp

  24. Slide 24: Q3 FY 2016 Reconciliation of Reported Diluted EPS to Adjusted

    Q3 FY 2016 Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS (Unaudited) Three Months Ended June 30, Foreign Foreign Foreign Currency Currency Currency Neutral Neutral 2016 2015 Growth Translation Growth Growth % Growth % Reported Diluted Earnings per Share $ 1.80 $ 0.29 $ 1.51 $ (0.10)

  25. Slide 25: Q3 YTD 2016 Reconciliation of Reported Diluted EPS to Adjusted

    Q3 YTD 2016 Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS (Unaudited) Nine Months Ended June 30, Foreign Foreign Foreign Currency Currency Currency Neutral Neutral 2016 2015 Growth Translation Growth Growth % Growth % Reported Diluted Earnings per Share $ 4.41 $ 2.52 $ 1.89 $ (0.51)

  26. Slide 26: FY 2016 Reconciliation – FX Impact Emerging and Developed Markets

    FY 2016 Reconciliation – FX Impact Emerging and Developed Markets (Unaudited; Amounts in millions) Emerging Markets* Developed Markets Q1 Q2 Q3 Q3 YTD Q4 Full Year Q1 Q2 Q3 Q3 YTD Q4 Full Year A BDX Reported 2016 465 443 485 1,393 2,521 2,625 2,713 7,858 B Deferred Revenue - - - - 6 4 2 12 A+B BDX A

  27. Slide 27: FY 2016 Reconciliation – FX Impact Emerging Markets Safety and China

    FY 2016 Reconciliation – FX Impact Emerging Markets Safety and China (Unaudited; Amounts in millions) Emerging Markets Safety* Q1 Q2 Q3 Q3 YTD Q4 Full Year BDX Reported 2016 100 104 122 326 Adjusted Comparable Growth % (3.6) 2.9 11.7 3.8 FX Neutral Growth % 10.9 15.6 19.6 15.4 FX Impact % (14.4) (12

  28. Slide 28: Q3 and Q3 YTD FY 2016 Safety Revenue

    Q3 and Q3 YTD FY 2016 Safety Revenue (Unaudited; Amounts in millions) Three Months Ended June 30, A B C D=(A-B)/B E=(A-B-C)/B As Reported FX % Change 2016 2015 Impact Reported FXN TOTAL SAFETY REVENUES United States $ 450 $ 427 $ - 5.3 5.3 International 334 302 (9) 10.8 13.9 TOTAL $ 784 $ 729 $ (9)

  29. Slide 29: Q3 YTD FY 2016 Adjusted FXN Revenues

    Q3 YTD FY 2016 Adjusted FXN Revenues (Unaudited; Amounts in millions) 2016 Q1 Q2 Q3 Q3 YTD A BDX As Reported Revenues 2,986 3,067 3,198 9,252 B Deferred Revenue 6 4 2 12 A+B BDX As Adjusted Revenues 2,992 3,071 3,200 9,263 C FX Impact (162) (113) (29) (304) A+B-C BDX As Adjusted FXN Revenues 3,155 3

  30. Slide 30: FY 2016 Outlook Reconciliation

    FY 2016 Outlook Reconciliation FY2015 FY2016 Outlook Revenues % Increase FX Impact % Increase FXN BDX As Reported Revenue $ 10,282 21.0% - 21.5% ~(3.5%) 24.5% - 25.0% Deferred Revenue Adjustment 20 NM NM NM BDX As Adjusted Revenue 10,302 21.0% - 21.5% ~(3.5%) 24.5% - 25.0% CareFusion First Half Reve

  31. Slide 31: FY 2016+ Product Launches

    FY 2016+ Product Launches Medical Segment Program / Product Planned Launch Date • BD Insulin Infusion Sets  FY 2016 • Pyxis Mini  FY 2016 Life Sciences Segment Program / Product Planned Launch Date • BD MAX™ – Extended Enteric Bacterial  FY 2016 EU / FY 2017 U.S. • BD MAX™ – Enteric Viral  FY 20

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