Becton, Dickinson And Company · NYSE:BDX
Becton, Dickinson And — Q3 2020 Earnings Presentation
36 slides from Becton, Dickinson And's earnings presentation, Aug 6, 2020
Slide 1: Third Quarter Results Fiscal Year 2020
Third Quarter Results Fiscal Year 2020 August 6, 2020 BD and the BD Logo are trademarks of Becton, Dickinson and Company © 2020 BD and its subsidiaries All rights reserved
Slide 2: Forward-Looking Statements
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 earnings release furnished as an exhibit to the Form 8-k that BD filed today with the SEC,
Slide 3: Q3 Overview
Q3 Overview Tom Polen CEO and President 3 BD and the BD Logo are trademarks of Becton, Dickinson and Company © 2020 BD and its subsidiaries All rights reserved
Slide 4: Q3 results reflect COVID-19 impact, with encouraging trends in June and July
Our Q3 financial results reflect the impact of COVID-19 during the quarter, with encouraging trends in June and July Interventional Medical Life Sciences Sequential Impacted by lower Strong demand for improvement each hospital utilization, COVID-19 diagnostics, month as elective and with demand for
Slide 5: BD uniquely positioned to advance COVID-19 solutions across the continuum of care
BD is uniquely positioned to advance COVID-19 solutions across the continuum of care CONTINUUM OF CARE Discovery Diagnosis Delivery of care & treatment of disease Life Sciences Medical Interventional Improving diagnosis & selection of Optimizing core healthcare Advancing technologies to optimal trea
Slide 6: New diagnostic solutions for the COVID-19 response
Advancing innovation and launching new diagnostic solutions to help the world’s response to COVID-19 BD Synapsys™ Point-of-care antigen Molecular PCR Rapid and reliable testing at the Easy-to-use, real-time PCR tests on point of care: Patient BD MAX™ Management • Confirms active COVID-19 infection i
Slide 7: Manufacturing capabilities to help deliver a COVID-19 vaccine
Leveraging our manufacturing capabilities and scale to help the world prepare to deliver a COVID-19 vaccine • Global orders for 470 million injection devices to date: Other 190 million 75 million 65 million 140 million • Investing to expand injection device manufacturing capacity in the U.S. • Throu
Slide 8: FY 2020 Planned Product Launches
FY 2020 Planned Product Launches: Robust pipeline drives growth with innovative solutions Medical BD Provena™ Solo BD Provena™ Midline Catheter BD PowerMidline™ Catheter with BD InSyte™ Autoguard™ BD Intraosseous Vascular Access BD Pyxis™ Logistics 1.2 BD Intevia™ 1ml BD HealthSight™: MedSafety, Cli
Slide 9: Advancing long-term strategy to emerge strong
Advancing our long-term strategy to emerge strong and better positioned for value creation Strong focus on cash and expense management INNOVATION EFFICIENCY Project Recode remains on track ACCESS EMPOWERMENT Operating with discipline to Access the report at maximize impact http://bd.com/sustai
Slide 10: Q3 results and COVID-19 impact
Q3 results and COVID-19 impact Chris Reidy Executive Vice President, CFO and Chief Administrative Officer 10 BD and the BD Logo are trademarks of Becton, Dickinson and Company © 2020 BD and its subsidiaries All rights reserved
Slide 11: Continuing to create and deliver value to all stakeholders
Continuing to create and deliver value to all stakeholders Continue to prioritize and adapt to the needs of our 1 associates and customers around the world Rapidly expanding our portfolio of solutions 2 to address the COVID-19 pandemic Focused on execution as our long-term strategy 3 remains intact
Slide 12: Financial results: Q3 FY 2020
Financial results: Q3 FY 2020 Q3 YTD Revenues $3,855 $12,333 Q3 revenue growth Revenue impacted by (~$600M) FXN % growth (9.4%) (1.6%) Growth related to COVID-19 COVID impact ~(1,400 bps) % growth (11.4%) (2.9%) (1) Q3 operating margins Adjusted OIBT $773 $2,837 Margin impacted by rich decremental E
Slide 13: Net COVID impact of ~$600M in Q3 FY 2020
Net COVID impact of (~$600M) in Q3 FY 2020 – Reduced elective procedure impacting Surgery & PI – Reduced hospital admissions resulting in lower procedure volumes, impacting medical device consumables in MDS and MMS Q3 COVID • Consequently, saw distributor inventory levels re-balance down after surge
Slide 14: Medical segment revenue
Medical segment revenue Medication Delivery Solutions: $781 Q3 Q3 (17.8%) YTD (6.4% ) Reduced hospital admissions due to COVID-19 leading to lower demand across the portfolio. Additionally, lower (20.3%) (8.1%) volumes in China due to the tendering process Q3 COVID impact: ~(2,000 bps) $2,122 Medica
Slide 15: Life sciences segment revenue
Life sciences segment revenue Q3 Diagnostic Systems: $402 Performance driven by increased demand for COVID-19 +12.1% +10.4% related testing on BD MAXTM partially offset by a significant Q3 YTD +9.3% +8.7% decline in non-COVID-19 diagnostic testing $951 Q3 COVID impact: ~(100 bps) (7.8%) FXN COVID im
Slide 16: Interventional segment revenue
Interventional segment revenue Q3 Peripheral Intervention: $318 COVID-19 negatively impacted demand for elective procedures (18.2%) (3.4%) in Oncology within the U.S., Europe and China and ESKD and Q3 YTD (19.8%) (4.6%) PAD in the U.S. and Europe. Sequential improvement seen $782 across all platform
Slide 17: Adjusted gross and operating margins: Q3 FY 2020
Adjusted gross and operating margins: Q3 FY 2020 55.6% 0.5% Adjusted -3.9% 51.7% Gross (3.9%) (0.5%) margin ~80% decremental margin from the mix of impacted revenues, high fixed costs and investments Q3 2019 COVID Impact Leverage Currency Q3 2020 25.4% Adjusted 0.7% 20.1% Operating (4.9%) (0.6%) (0.
Slide 18: Adjusted income statement: Q3 FY 2020
Adjusted income statement: Q3 FY 2020 As Adjusted (1) Q3 FY 2020 % Growth % FXN Growth Revenues $3,855 (11.4%) (9.4%) Gross Profit 1,993 (17.6%) (15.1%) % of revenues 51.7% SSG&A 979 8.8% 6.7% % of revenues 25.4% R&D 241 0.3% (0.2%) % of revenues 6.3% Operating Income 773 (30.0%) (26.6%) % of revenu
Slide 19: Macro view of COVID-19 impact and key considerations
Macro view of COVID-19 impact as of August 6th and key considerations looking forward • Varying degrees of the COVID-19 pandemic around the world, including infection levels, recovery and resurgence, and the ongoing uncertainty in general healthcare utilization levels Macro • Expect a weaker global
Slide 20: COVID-19 impact on Q3 revenues and key observations
COVID-19 impact on Q3 revenues and key observations Note: Dollar and growth percentages reflect estimated COVID-19 revenue impact vs. pre-COVID expectations (Does not reflect year-over-year growth.) Elective Procedures Acute / Non-Acute Care Diagnostic Testing Research & Clinical Labs SURG (~$130M)
Slide 21: Preliminary July observations
Preliminary July observations •• Elective Elective procedure procedure volumes volumes improved improved from from ~80% ~80% in in June June to to Saw sequential ~85% ~85% inin July July improvement in •• The U.S.impact from hospital lower U.S. improved admissions hospital and admissions continue im
Slide 22: Q4 and FY 2020 guidance
Q4 and FY 2020 guidance Revenue Adjusted EPS (1) FXN and reported revenue Adjusted EPS expected to be Q4 expected to be down low- $2.40 to $2.60 single digits FXN %: (2.0%) to (1.5%) Adjusted EPS: $9.80 to $10.00 Full- FX Impact: (~1%) Adjusted FXN %: (~14.5%) to (~12.5%) year Reported %: (3.0%) to
Slide 23: Key takeaways
Key takeaways Continue to be uniquely positioned to respond to COVID-19 by leveraging our core capabilities across research, diagnosis and patient care Third quarter results reflect encouraging trends in June Establishing guidance for fiscal fourth quarter and full-year as we have improved near-term
Slide 24: Advancing the world of health
<3 BD Advancing the world of health
Slide 25: Advancing long-term strategy to emerge strong
Advancing our long-term strategy to emerge strong and better positioned for value creation 25 BD and the BD Logo are trademarks of Becton, Dickinson and Company © 2020 BD and its subsidiaries All rights reserved
Slide 26: Geographic revenue highlights
Geographic revenue highlights Q3 revenue $ and FXN growth Q3 COVID Impact $2,119 United States ~(15%) / ~($370M) (13.1%) $1,735 International ~(12%) / ~($230M) (4.7%) $3,283 Developed Markets ~(12%) / ~($450M) (8.8%) $572 Emerging (12.9%) Markets ~(21%) / ~($150M) $250 China ~(22%) / ~($70M) (17.0%)
Slide 27: Impact: Delivering long-term value for all stakeholders
Impact: Delivering long-term value for all stakeholders Management Approach Q3 Update Develop and maintain a strong portfolio • BD introduced the Halo One™ Thin-Walled Guiding Sheath which of leading products and solutions that reduces the size of the arteriotomy compared to standard sheaths of addr
Slide 28: FY 2019 Sustainability Report
FY 2019 Sustainability Report BD launched its FY 2019 Sustainability Report in July 2020. Highlights from this year’s report include: Innovation: In FY 2019 BD launched 25 major products across the company, each of which moved our innovation goals forward. The report highlights a number of these pro
Slide 29: Estimated COVID-19 impact on preliminary April revenue
Estimated COVID-19 impact on preliminary April revenue results and key observations Elective Procedures Acute / Non-Acute Care Diagnostic Testing Research & Clinical Labs SURG (~$60M) MMS +~$70M IDS (DS & PAS) BIO (~$20M) PI (~$50M) MDS (~$50M); UCC (~$20M) (~$40M) Significant procedure Demand for i
Slide 30: Q3 FY 2020 & Q3 FY 2019 Adjustment Reconciliations
Q3 FY 2020 & Q3 FY 2019 Adjustment Reconciliations 30 BD and the BD Logo are trademarks of Becton, Dickinson and Company © 2020 BD and its subsidiaries All rights reserved
Slide 31: YTD Q3 FY 2020 & YTD Q3 FY 2019 Adjustment Reconciliations
YTD Q3 FY 2020 & YTD Q3 FY 2019 Adjustment Reconciliations 31 BD and the BD Logo are trademarks of Becton, Dickinson and Company © 2020 BD and its subsidiaries All rights reserved
Slide 32: Q3 FY 2020 Reconciliation of Reported to Adjusted Diluted EPS
Q3 FY 2020 Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS 32 BD and the BD Logo are trademarks of Becton, Dickinson and Company © 2020 BD and its subsidiaries All rights reserved
Slide 33: YTD Q3 FY 2020 Reconciliation of Reported to Adjusted Diluted EPS
YTD Q3 FY 2020 Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS 33 BD and the BD Logo are trademarks of Becton, Dickinson and Company © 2020 BD and its subsidiaries All rights reserved
Slide 34: Q3 and YTD FY 2020 Reconciliation – FX Impact
Q3 and YTD FY 2020 Reconciliation – FX Impact Emerging, Developed Markets & China 34 BD and the BD Logo are trademarks of Becton, Dickinson and Company © 2020 BD and its subsidiaries All rights reserved
Slide 35: FY 2020 Revenue & EPS Outlook Reconciliation
FY 2020 Revenue & EPS Outlook Reconciliation 35 BD and the BD Logo are trademarks of Becton, Dickinson and Company © 2020 BD and its subsidiaries All rights reserved
Slide 36: YTD Q3 FY 2020 Operating Cash Flow Reconciliation
YTD Q3 FY 2020 Operating Cash Flow Reconciliation (Unaudited, Amounts in billions) Reported Operating Cash Flow $ 2.1 Adjustments (excludes non-cash items) Restructuring costs 0.0 Integration costs 0.2 Transaction gain/loss and product-related matters 0.2 Other 0.4 Tax impact related to items above
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