Baxter International Inc. · NYSE:BAX
Baxter International — Q3 2019 Earnings Presentation
22 slides from Baxter International's earnings presentation, Oct 24, 2019
Slide 1: Third-Quarter 2019 Preliminary Operating Results
Third-Quarter 2019 Preliminary Operating Results Baxter International Inc. October 24, 2019
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation includes forward-looking statements concerning the Company’s financial results, business development activities, capital structure, cost savings initiatives, and R&D pipeline, including results of clinical trials and planned product launches. These forward-loo
Slide 3: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures To supplement Baxter’s preliminary consolidated financial information presented on a GAAP basis, the Company discloses certain non-GAAP financial measures. These non-GAAP financial measures are not in accordance with generally accepted accounting principles in the
Slide 4: Table of Contents
Table of Contents Performance Summary 6 Preliminary Financial Results 11 Fourth-Quarter 2019 Outlook 16 Non-GAAP Reconciliations 18
Slide 5: Top Quartile Goals / Our Strategy
Top Quartile Goals Product safety and Quality Best place to work Growth through innovation Industry leading performance Our Strategy Strengthen our portfolio and extend our impact through transformative innovation that spans prevention to recovery 5
Slide 6: Executing On Our Strategy
Executing On Our Strategy Third-Quarter 2019 Highlights1 Building Momentum With Strong Focus On Operational Performance2 ▪ Delivered 5% operational sales growth reflecting strength across all businesses and commitment to innovation ▪ Adjusted operating margin of 19.5% driven by solid top-line perfor
Slide 7: Continued Strength In Operational Performance
Continued Strength In Operational Performance Third-Quarter 2019 Snapshot1,2 Global Reported Sales Adjusted Gross Margin Adjusted Operating Margin $2.85B 45.7% 19.5% +3% Reported ǀ +5% Operational Of Sales Of Sales Strategic transformation yielding Benefit from strong top-line Reflects strong top-li
Slide 8: Strong Performance Across Portfolio
Strong Performance Across Portfolio Third-Quarter 2019 Business Drivers1,2 Renal Care Medication Delivery $918M $701M Strength in PD therapies globally partially Performance driven by focused commercial offset by lower sales for select in-center HD execution for Spectrum IQ in the U.S. and products
Slide 9: Third-Quarter 2019 Sales
Third-Quarter 2019 Sales1,2 Metric Q3 2019 Q3 2019 Guidance Actual Sales Growth 3% - 4% +3% Reported Sales Growth ~5% +5% Constant Currency Sales Growth ~5% +5% Operational 1Financials referenced in this slide are preliminary and subject to change. 2Non-GAAP financial metrics referenced in this slid
Slide 10: Advancing Our New Product Portfolio
Advancing Our New Product Portfolio Recent R&D And Commercial Milestones1 Finomel ► Announced U.S. launch of PrisMax system and the integrated TherMax blood warmer; features include straightforward connectivity to hospital EMR2 and unique TrueVue Analytics platform to help clinical teams continuousl
Slide 11: Preliminary Financial Results
Preliminary Financial Results Third-Quarter 2019 October 24, 2019 11
Slide 12: Third-Quarter 2019 Sales By Global Business Unit
Third-Quarter 2019 Sales By Global Business Unit1 Q3 2019 Revenue $ In Millions U.S. International Total Renal Care $199 $719 $918 Medication Delivery $461 $240 $701 Pharmaceuticals $223 $304 $527 Clinical Nutrition $80 $139 $219 Advanced Surgery $134 $82 $216 Acute Therapies $44 $86 $130 Other $83
Slide 13: Third-Quarter 2019 Sales By Operating Segment
Third-Quarter 2019 Sales By Operating Segment1 Q3 2019 Revenue $ In Millions Reported Americas $1,534 (North and South America) EMEA $730 (Europe, Middle East and Africa) APAC $587 (Asia Pacific) Total Baxter $2,851 1Financials referenced in this slide are preliminary and subject to change. 13
Slide 14: Third-Quarter 2019 Adjusted Financial Results
Third-Quarter 2019 Adjusted Financial Results1,2 $ In Millions % of Sales Adjusted Gross Margin $1,303M 45.7% Adjusted SG&A Expense $614M 21.5% Adjusted R&D Expense $134M 4.7% Adjusted Operating Income $555M 19.5% 1Financials referenced in this slide are preliminary and subject to change. 2Non-GAAP
Slide 15: Strategically Deploying Capital To Fuel Growth And Create Value
Strategically Deploying Capital To Fuel Growth And Create Value Reinvestment in Business Investing in higher-margin, faster-growing businesses to drive meaningful innovation and enable accelerating launch cadence Dividend Issuance Announced quarterly dividend of $0.22 per share; currently targeting
Slide 16: Financial Outlook
Financial Outlook Fourth-Quarter 2019 October 24, 2019 16
Slide 17: Fourth-Quarter 2019 Financial Guidance
Fourth-Quarter 2019 Financial Guidance1 Fourth-Quarter 2019 Guidance Sales Growth 3% - 4% Reported Foreign Exchange 100+ bps Sales Growth ~5% Constant Currency U.S. Cyclo Competition <50 bps Sales Growth ~5% Operational Adjusted Operating Margin 18.5% - 19.0% 1Non-GAAP financial metrics referenced i
Slide 18: Non-GAAP Reconciliations
Non-GAAP Reconciliations October 24, 2019 18
Slide 19: Non-GAAP Reconciliation as of October 24, 2019
Non-GAAP Reconciliation as of October 24, 2019 Non-GAAP Reconciliations: As part of its Q3 2019 preliminary operating results announcement on October 24, 2019, Baxter presented preliminary consolidated financial information for Q3 2019. Baxter also presented guidance for Q4 2019. In these presentati
Slide 20: Description of Adjustments and Reconciliation of GAAP to Non-GAAP Measures
Description of Adjustments and Reconciliation of GAAP to Non-GAAP Measures For The Three Months Ended September 30, 2019 (unaudited) (in millions, except percentage data) The following is a reconciliation of sales growth on a reported basis to operational sales growth from the three months ended Sep
Slide 21: Non-GAAP Reconciliation as of October 24, 2019
Non-GAAP Reconciliation as of October 24, 2019 Reconciliations for Q4 2019 Forecasts The reconciliation between the projected Q4 2019 GAAP sales growth and projected operational sales growth follows: N et Sales as U.S. Operational Reported Cyclophosphamide FX Sales 3% - 4% 0% 1% - 2% 5% The reconcil
Slide 22: Third-Quarter 2019 Preliminary Operating Results
Third-Quarter 2019 Preliminary Operating Results Baxter International Inc. October 24, 2019