Slide 1: Q2 FY24 earnings presentation
Q2 FY24 earnings presentation August 8, 2024 © Solventum 2024. All rights reserved.
Slide 2: Forward-looking statements and use of document
Forward-looking statements and use of document Forward-looking statements This presentation contains forward-looking information about Solventum's financial results and estimates and business prospects that involve substantial risks and uncertainties. In particular, statements regarding the future p
Slide 3: Executive summary
Executive summary Q2 financial summary: 1 • Net sales of $2.081B (+1.3%) - Reflects normalizing of pricing - Slight volume growth, incudes benefit from backorder improvement • Adjusted operating income reflects lower gross margins and an increase in operating expenses related to public company and f
Slide 4: Q2 FY24 Financial summary
Q2 FY24 Financial summary Dental Segment Sales Key metrics Solutions MedSurg $331M -5.8% Reported $1,162M -2.0% Organic +0.1% Reported non- +1.8% Organic GAAP GAAP2 Health Information Total Solventum1 Operating margin 11.7% 20.7% Systems $328M $2,081M Earnings Per Share +3.5% Reported +0.2% Y/Y Repo
Slide 5: Med Surg summary
Med Surg summary Q2 financial results Q2 FY24 Q2 FY23 Y/Y Reported +0.1% Net sales $1,162M $1,161M Organic +1.8% Segment drivers: • Organic growth led by OEM backorder reduction and a modest benefit from pricing 3M Prevena Plus single-use NPWT for closed surgical incisions and open wounds • Growth a
Slide 6: Dental Solutions summary
Dental Solutions summary Q2 financial results Q2 FY24 Q2 FY23 Y/Y Reported -5.8% Net sales $331M $351M Organic -2.0% Segment drivers: • Organic growth driven by volume declines partially offset by modest pricing • Reported growth includes impact from Q3 FY23 divestiture of the local anesthetic busin
Slide 7: Health Information Systems summary
Health Information Systems summary Q2 financial results Q2 FY24 Q2 FY23 Y/Y Reported 3.5% Net sales $328M $316M Organic 3.6% Segment drivers: • Organic growth driven by continued adoption of 360 Encompass revenue cycle management and performance management solutions, partially offset by clinician pr
Slide 8: Purification & Filtration summary
Purification & Filtration summary Q2 financial results Q2 FY24 Q2 FY23 Y/Y Reported -3.6% Net sales $238M $248M Organic -0.9% Segment drivers: • Organic growth impacted by performance in drinking water filtration end markets partially offset by continued strength in bioprocessing filtration Emphaze
Slide 9: Raising FY24 organic sales growth and EPS guidance
Raising FY24 organic sales growth and EPS guidance Organic sales growth 0% to +1% Additional considerations: • SKU rationalization project: not expected to have a material impact on FY2024 revenue or margin performance Adjusted EPS $6.30 to $6.50 • 3M-supply agreement: started April 1, 2024, continu
Slide 10: Appendix
Appendix © Solventum 2024. All rights reserved. 10
Slide 11: Non-GAAP financial measures
Non-GAAP financial measures In addition to reporting financial results in accordance with U.S. GAAP, Solventum also provides non-GAAP measures that we use, and plan to continue using, when monitoring and evaluating operating performance and measuring cash available to invest in our business. The adj
Slide 12: Q2 FY24 detailed non-GAAP reconciliation and free cash flow
Q2 FY24 detailed non-GAAP reconciliation and free cash flow Spin-off & separation- Legal entity (Millions, except per share data) Q2 FY24 GAAP Amortization Restructuring Q2 FY24 non-GAAP related costs restructuring Net sales 2,081 2,081 Cost of sales1 944 (3) (21) 920 Gross margin 1,137 3 21 1,161 R
Slide 13: Glossary and definitions
Glossary and definitions Organic sales growth Abbreviation Elaboration Total net sales less the impacts of foreign currency and sales from business acquisitions or divestitures for the first 12 months post-transaction EPS Earnings per share Adjusted operating income FCF Free cash flow Operating inco