Baxter International Inc. · NYSE:BAX
Baxter International — Investor Day (May 2022)
15 slides from Baxter International's investor day presentation, May 25, 2022
Slide 1: Financial Outlook
FINANCIAL OUTLOOK JAY SACCARO Executive VP and Chief Financial Officer
Slide 2: Forward-Looking Statements
Forward-Looking Statements The presentations being made on May 25, 2022 include forward-looking statements concerning Baxter’s financial results, R&D pipeline, including planned product launches (many of which are subject to regulatory approval and may require additional investment) and results of c
Slide 3: Well Positioned To Deliver Enhanced Shareholder Value
Well Positioned To Deliver Enhanced Shareholder Value Unlocking Efficiencies To Delivering Innovation And Prioritizing Disciplined Capital Expand Margins And Market Expansion To Allocation While Maintaining Drive Double-Digit Outpace End Markets Investment Grade Profile Adjusted EPS Growth • New pro
Slide 4: Long-Range Outlook: Guidelines & Assumptions
Long-Range Outlook: Guidelines & Assumptions Outlook Assumes: Outlook Does Not Assume: • Foreign exchange rates held constant at current rates • Significant disruptions due to emerging COVID variants • Oil prices expected to gradually decline over the long- range outlook • New M&A initiatives includ
Slide 5: Poised To Deliver Strong Financial Outlook
Poised To Deliver Strong Financial Outlook 2022 2022 – 2025 Full Year Guidance Long-Range Outlook Operational Sales Growth ~3%1 4% - 5% CAGR Adjusted Operating Margin +350 to 400 bps Flat to Prior Year Expansion by 2025 Low Double-Digit Adjusted Diluted EPS $4.12 - $4.20 CAGR Free Cash Flow Conversi
Slide 6: Targeting Above-Market Sales Growth (2022 - 2025)
Targeting Above-Market Sales Growth (2022 - 2025)1 ~60 bps ~160 bps ~230 bps 4% - 5% Constant Currency CAGR 2022E Base Business Innovation Market Expansion2 2025E Guidance Outlook Sales Growth Driven By Innovation And Market Expansion Initiatives 1Bps impacts sum to the midpoint of guidance range. 2
Slide 7: Delivering Solid Revenue Growth By Business
Delivering Solid Revenue Growth By Business 2022 - 2025 CAGR 2022 - 2025 CAGR Market Market Growth Baxter Outlook PSS & GSS 6% - 7% 6% - 7% Acute Therapies 6% - 7% 7% - 8% Front Line Care 5% - 6% 8% - 9% Renal Care ~4% 4% - 5% Advanced Surgery 3% - 4% 4% - 5% Pharmaceuticals & BPS ~3% 3% - 4% Medica
Slide 8: Unlocking Value Through ISC Transformation
Unlocking Value Through ISC Transformation Key Initiatives Materials Productivity Mitigating Near Term Headwinds Through Architecture Automation & Digitization Increased Operational Efficiencies Analytics Targeting ~$650M In Gross Savings By 2025; More Than Offsetting Normal Operating Expenditure In
Slide 9: Accelerating Value Creation Through Cost Synergies
Accelerating Value Creation Through Cost Synergies Updated Hillrom Cost Synergy Outlook ~$350M • Tracking to deliver ~$100M of cost ~$300M synergies in 2022 • Focusing on capturing value through ~$250M optimizing our operating model, ~$100M Commitment At Deal harmonizing procurement, and Announcemen
Slide 10: Driving Meaningful Adjusted Operating Margin Improvement
Driving Meaningful Adjusted Operating Margin Improvement1 ~140 bps ~(115) bps ~170 bps ~180 bps 350 - 400 Bps Adjusted Operating Margin Expansion 2022E Operational ISC Value Reinvestment in 2025E Guidance Transformation2 Capture Business Outlook Expanding Operating Margins By 350 – 400 Bps Driven By
Slide 11: Committed To Strong Cash Flow Generation
Committed To Strong Cash Flow Generation Free Cash Flow Conversion • Generating strong operating cash flow driven by targeted working capital improvements 80%+ 73% 76% • Deploying capital investments to support cost reductions, innovation, volume growth, and patient safety & quality • Free cash flow
Slide 12: Driving Disciplined Portfolio Management
Driving Disciplined Portfolio Management • Reinvesting in business to enhance innovation and accelerate growth • Focusing organic investments on critical projects aligned to strategy and business profile • Strategically executing targeted acquisitions, consistent with capital allocation priorities •
Slide 13: Maintaining Disciplined Capital Allocation Philosophy
Maintaining Disciplined Capital Allocation Philosophy Preserving Solid Investment Maintaining Pro Grade Ratings Forma Liquidity Guiding Principles Providing Capital Returning Value Structure Flexibility To Shareholders Targeting Deleveraging To ~2.75x Net Leverage In 2024 38
Slide 14: Financial Outlook Summary
Financial Outlook Summary • Positioning Baxter to deliver 4% - 5% sales CAGR through 2025, growing faster than the market driven by innovation and market expansion • Expanding 2025 operating margins by 350 - 400 bps through product mix, transforming integrated supply chain and value capture initiati
Slide 15: Baxter 2022 Investor Conference
Baxter 2022 Investor Conference Wigs ee,