Baxter International Inc. · NYSE:BAX
Baxter International — Q1 2022 Earnings Presentation
26 slides from Baxter International's earnings presentation, Apr 28, 2022
Slide 1: First-Quarter 2022 Earnings
First-Quarter 2022 Earnings Baxter International Inc. April 28, 2022 Hillrom is a part of Baxter
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation includes forward-looking statements concerning the company’s financial results (including the outlook for second quarter and full-year 2022) and business development and regulatory activities (including the December 2021 acquisition of Hillrom). These for
Slide 3: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures To supplement Baxter’s consolidated financial statements presented on a U.S. 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 United S
Slide 4: Table of Contents
Table of Contents Performance Summary 5 Financial Results 10 2022 Outlook 15 Non-GAAP Reconciliations 18
Slide 5: Performance Highlights
Performance Highlights First-Quarter 2022 $3.7B +26% Reported +29% Constant Currency1 Sales +3% Operational2 Key Metrics U.S. GAAP Adjusted3 Gross Margin 36.4% 45.0% YOY Change (250 bps) +300 bps Operating Margin 4.4% 18.0% YOY Change (880 bps) +100 bps Diluted EPS $0.14 $0.93 YOY Change (76%) +22%
Slide 6: Executing On Our Strategy
Executing On Our Strategy Recent Highlights Demonstrating Ongoing Portfolio Resilience In Dynamic Environment1 ▪ Operational sales growth of 3% and adjusted diluted EPS growth of 22% in Q1 2022 driven by improving rates of hospital admission and elective surgeries and the contribution from Hillrom I
Slide 7: Key Financial Metrics
Key Financial Metrics First-Quarter 2022 Snapshot1 Global Reported Sales Adjusted Operating Margin Adjusted Diluted EPS $3.7B 17.0% 18.0% $0.93 $2.9B $0.76 +3% Operational Growth 2 +100 bps +22% Q1 2021 Q1 2022 Q1 2021 Q1 2022 Q1 2021 Q1 2022 1Non-GAAP financial metrics referenced in this slide incl
Slide 8: First-Quarter 2022 Performance
First-Quarter 2022 Performance1 Metric Q1 2022 Q1 2022 Guidance Actual Sales Growth 24% - 25% +26% Reported Sales Growth 27% - 28% +29% Constant Currency Sales Growth LSD2 Growth +3% Operational Adjusted Diluted EPS $0.79 - $0.82 $0.93 Growth vs. Prior-Year Period 4% –8% +22% Strong Adjusted EPS Per
Slide 9: Strong Performance Driven By Pandemic Recovery
Strong Performance Driven By Pandemic Recovery First-Quarter 2022 Business Drivers1 Product Category Sales CC Growth2 Quarterly Performance Drivers Performance driven by growth in PD business reflecting a year-over-year increase in Renal Care $894M +1% global patient volumes; partially offset by low
Slide 10: Financial Results
Financial Results First-Quarter 2022 Earnings April 28, 2022 10
Slide 11: First-Quarter 2022 Sales By Product Category
First-Quarter 2022 Sales By Product Category1 Q1 2022 Revenue Total Growth $ In Millions U.S. International Total Reported Constant Operational Renal Care $225 $669 $894 (3%) +1% +1% Medication Delivery $472 $234 $706 +8% +10% +10% Pharmaceuticals $157 $364 $521 (6%) (2%) (2%) Clinical Nutrition $84
Slide 12: First-Quarter 2022 Sales By Operating Segment
First-Quarter 2022 Sales By Operating Segment1 Q1 2022 Revenue Total Growth $ In Millions Reported Reported Constant Operational Americas $1,626 +4% +5% +5% (North and South America) EMEA (Europe, Middle East and $699 (5%) +2% +2% Africa) APAC $627 (3%) 0% 0% (Asia Pacific) Hillrom $755 N/A N/A N/A
Slide 13: First-Quarter 2022 Adjusted Financial Results
First-Quarter 2022 Adjusted Financial Results1 Q1 2021 Q1 2022 Change Adjusted Gross Margin 42.0% 45.0% +300 bps Adjusted SG&A Expense 20.7% 23.1% +240 bps (% of Sales) Adjusted R&D Expense 4.3% 4.0% (30 bps) (% of Sales) Adjusted Operating Margin 17.0% 18.0% +100 bps Adjusted Diluted EPS $0.76 $0.9
Slide 14: Strong Cash Flows And Disciplined Capital Allocation Strategy
Committed To Generating Strong Cash Flows And Executing Disciplined Capital Allocation Strategy Cash Flow Generated $208M of cash flow from continuing operations Strategic Business Development Integration of Hillrom proceeding on course; combined entity well-positioned to expand access globally to g
Slide 15: 2022 Outlook
2022 Outlook First-Quarter 2022 Earnings April 28, 2022 15
Slide 16: Full-Year 2022 Guidance
Full-Year 2022 Guidance1 FY 2022 Guidance Sales Growth 23% - 24% Reported Foreign Exchange ~200 bps Sales Growth 25% - 26% Constant Currency Hillrom 2200 - 2300 bps Sales Growth ~3% Operational GAAP Diluted EPS $2.35 - $2.43 Growth vs. Prior-Year Period (7%) – (4%) Adjusted Diluted EPS $4.12 - $4.20
Slide 17: Second-Quarter 2022 Guidance
Second-Quarter 2022 Guidance1 Q2 2022 Guidance Sales Growth ~26% Reported Foreign Exchange 300 - 400 bps Sales Growth 29% - 30% Constant Currency Hillrom 2500 - 2600 bps Sales Growth ~4% Operational GAAP Diluted EPS $0.48 - $0.51 Growth vs. Prior-Year Period (19%) – (14%) Adjusted Diluted EPS $0.86
Slide 18: Non-GAAP Reconciliations
Non-GAAP Reconciliations First-Quarter 2022 Earnings April 28, 2022 18
Slide 19: Non-GAAP Reconciliation as of April 28, 2022
Non-GAAP Reconciliation as of April 28, 2022 Non-GAAP Reconciliations: As part of its Q1 2022 earnings announcement on April 28, 2022, Baxter presented its financial results for the first quarter of 2022. Baxter also presented guidance for the second quarter and full year of 2022. In these presentat
Slide 20: Description of Adjustments and Reconciliation of U.S. GAAP to Non-GAAP Measures
Description of Adjustments and Reconciliation of U.S. GAAP to Non-GAAP Measures Three Months Ended March 31, 2022 and 2021 (unaudited) (in millions, except per share and percentage data) The company’s U.S. GAAP results for the three months ended March 31, 2022 included special items which impacted t
Slide 21: Description of Adjustments and Reconciliation of U.S. GAAP to Non-GAAP Measures
Description of Adjustments and Reconciliation of U.S. GAAP to Non-GAAP Measures Three Months Ended March 31, 2022 and 2021 (unaudited) 1 The company’s results in 2022 and 2021 included intangible asset amortization expense of $217 million ($169 million, or $0.33 per diluted share, on an after-tax ba
Slide 22: Reconciliation of Operating Cash Flow to Free Cash Flow
Reconciliation of Non-GAAP Financial Measure Operating Cash Flow to Free Cash Flow (unaudited) (in millions) Three Months Ended March 31, 2022 2021 Cash flows from operations – continuing operations $ 208 $ 377 Cash flows from investing activities (304) (538) Cash flows from financing activities (54
Slide 23: Reconciliation of Net Sales Growth As Reported to Operational
Reconciliation of Non-GAAP Financial Measure Change in Net Sales Growth As Reported to Operational Sales Growth From The Three Months Ended March 31, 2021 to The Three Months Ended March 31, 2022 (unaudited) Sales By Product Category: Net Sales Growth Operational As Reported Hillrom FX Sales Growth*
Slide 24: Projected 2022 Sales Growth and Operating Margin Reconciliation
Reconciliation of Non-GAAP Financial Measure Projected Second Quarter and Full Year 2022 U.S. GAAP Sales Growth to Projected Operational Sales Growth, and Projected Second Quarter and Full Year 2022 U.S. GAAP Operating Margin to Projected Adjusted Operating Margin (unaudited) Sales Growth Guidance Q
Slide 25: Projected 2022 Tax Rate and Earnings Per Share Reconciliation
Reconciliation of Non-GAAP Financial Measure Projected Full Year 2022 U.S. GAAP Tax Rate to Projected Adjusted Tax Rate, and Projected Second Quarter and Full Year 2022 U.S. GAAP Earnings Per Share to Projected Adjusted Earnings Per Share (unaudited) The projected FY 2022 U.S. GAAP tax rate of appro
Slide 26: First-Quarter 2022 Earnings
First-Quarter 2022 Earnings Baxter International Inc. April 28, 2022 Hillrom is a part of Baxter