Becton, Dickinson And Company · NYSE:BDX
Becton, Dickinson And — Q4 2019 Earnings Presentation
35 slides from Becton, Dickinson And's earnings presentation, Nov 5, 2019
Slide 1: Fourth Quarter and Full Year Results Fiscal Year 2019
Fourth Quarter and Full Year Results Fiscal Year 2019 November 5, 2019 © 2019 BD. BD and the BD Logo are trademarks of Becton, Dickinson and Company.
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
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: Executive overview
Executive overview Vincent A. Forlenza Chairman and CEO 3 © 2019 BD. BD and the BD Logo are trademarks of Becton, Dickinson and Company.
Slide 4: FY 2019 Year-end highlights
FY 2019 Year-end highlights Strong performance to finish FY 2019 • Balanced growth across all three segments continues to demonstrate the breadth and depth of the portfolio • Accelerated revenue growth in the back half, as expected • Annual margin expansion in-line with expectations Continue to succ
Slide 5: BD + BARD: two-year lookback
BD + BARD: two-year lookback 1. Strengthens the core strategy – focusing on the most impactful areas in healthcare 2. Durable 5 to 6% growth profile with balanced performance across the portfolio Legacy BD 5.6% FY 2018 – 2019 Revenue CAGR Legacy BARD 6.2% % FXN FY 2018 FY 2019 Combined1 6.5% + 5.1%
Slide 6: FY 2020 Guidance and outlook
FY 2020 Guidance and outlook FY 2020 Guidance Revenues FXN % Growth 5.0% to 5.5% Adjusted EPS $ $12.50 to $12.65 Underlying EPS FXN % Growth 15.5% to 17% Adjusted EPS FXN % Growth 9.5% to 11% Adjusted EPS % Growth 7% to 8.5% • Guidance reflects strong revenue growth and continued momentum • Revenue
Slide 7: Financial performance
Financial performance Christopher Reidy Executive Vice President, CFO and Chief Administrative Officer 7 © 2019 BD. BD and the BD Logo are trademarks of Becton, Dickinson and Company.
Slide 8: Q4 FY 2019 Financial highlights
Q4 FY 2019 Financial highlights Revenue growth: Margin Expansion: Capital deployment: Q4 revenues driven by Q4 operating margins $675M debt pay down strength in all three of 27.4% - highest of in the fourth quarter segments the year and reflects and 3.5x gross leverage +150 bps of expansion at Septe
Slide 9: Q4 FY 2019 Medical segment update
Q4 FY 2019 Medical segment update Fourth Quarter Full Year Revenues Comparable Comparable $ % Growth FXN % $ % Growth FXN % Growth(1) Growth(1) Medical segment $2,437 +3.9% +5.3% $9,064 +5.2% +5.1% Medication Delivery Solutions 988 +2.2% +3.6% 3,859 +5.9% +3.0% Medication Management 733 +6.0% +6.8%
Slide 10: Q4 FY 2019 Life Sciences segment update
Q4 FY 2019 Life Sciences segment update Fourth Quarter Full Year Revenues Comparable Comparable % $ FXN % $ % Growth FXN % Growth Growth(1) Growth(1) Life Sciences segment $1,134 +2.3% +6.9% $4,300 (0.7%) +4.9% Diagnostic Systems 409 +6.6% +8.4% 1,547 +0.7% +3.8% Preanalytical Systems 393 +0.1% +1.9
Slide 11: Q4 FY 2019 Interventional segment update
Q4 FY 2019 Interventional segment update Fourth Quarter Full Year Revenues Comparable Comparable $ % Growth FXN % $ % Growth FXN % (1) Growth Growth(1) Interventional segment $1,013 +6.9% +7.7% $3,926 +29.3% +5.5% Peripheral Intervention 361 +3.5% +4.7% 1,389 +33.0% +2.9% Surgery 355 +8.3% +8.9% 1,3
Slide 12: Q4 FY 2019 Geographic revenue highlights
Q4 FY 2019 Geographic revenue highlights Fourth Quarter Full Year Revenues Comparable Comparable $ % Growth FXN % $ % Growth FXN % (1) Growth Growth(1) United States $2,562 +4.6% +4.9% $9,730 +11.0% +4.5% International $2,022 +3.5% +7.9% $7,560 +4.8% +5.9% Developed Markets 3,847 +3.9% +5.7% 14,579
Slide 13: Q4 FY 2019 adjusted income statement
Q4 FY 2019 adjusted income statement As adjusted(1) Q4 FY 2019 % Growth % FXN Growth Q4 FY 2018 Revenues $4,584 4.1% 5.4% $4,402 Comparable % FXN Growth(2) 6.2% Gross profit 2,616 5.1% 5.2% 2,490 % of revenues 57.1% 56.6% SSG&A 1,101 (0.1%) (1.4%) 1,100 % of revenues 24.0% 25.0% R&D 257 5.5% 5.1% 27
Slide 14: Q4 FY 2019 adjusted gross and operating margins
Q4 FY 2019 adjusted gross and operating margins 0.6% 57.1% Adjusted 56.6% Gross (0.1%) margin Q4 2018 Performance Currency Q4 2019 1.5% 0.5% 27.4% 25.4% Adjusted Operating margin Q4 2018 Performance Currency Q4 2019 +200 bps +210 bps +180 bps Multi-year +100 bps +60 bps Operating +50 bps margin FY 2
Slide 15: FY 2019 adjusted EPS results
FY 2019 adjusted EPS results (1) 11.9% FXN Growth 6.1% Growth ~3% ~16.5% (~4%) (~2%) Resins and other raw (~1.5%) $11.68 materials (~2%) $11.01 Flu Impact (~1%) (~6%) Tariffs (~1%) FY18 FY19 Favorable FY19 Divestiture DCB Impact FX FY19 Adjusted Underlying Year-over- Headwinds Impact Impact Adjusted
Slide 16: Guidance
Guidance Christopher Reidy Executive Vice President, CFO and Chief Administrative Officer 1 6 © 2019 BD. BD and the BD Logo are trademarks of Becton, Dickinson and Company.
Slide 17: FY 2020 revenue guidance
FY 2020 revenue guidance Revenues FXN % FY 2020 Growth Guidance Guidance BDX 5% to 5.5% Medical 4% to 5% Life Sciences 6% to 7% Interventional 5% to 6% 17 © 2019 BD. BD and the BD Logo are trademarks of Becton, Dickinson and Company.
Slide 18: FY 2020 adjusted earnings guidance
FY 2020 adjusted earnings guidance (1) 9.5% to 11% FXN Growth 7% to 8.5% Growth 15.5% to 17% $12.50 to $12.65 (~5%) (~1%) (~2.5%) $11.68 FY19 Adjusted FY20 Gore Royalty Tariff Estimated FY20 Adjusted EPS Underlying Expiration Impact Impact FX Impact EPS Guidance EPS FXN Growth (1) Current and prior-
Slide 19: FY 2020 guidance
FY 2020 guidance As adjusted FY 2020 Guidance BD Revenues FXN % Growth 5% to 5.5% Revenue – FX Impact (~1%) BD Reported Revenues 4% to 4.5% Gross margin 56% to 57% SSG&A (% of sales) 24% to 24.5% R&D (% of sales) 5.5% to 6% Operating margin 26% to 27% Operating margin expansion FXN ~+150 bps Interes
Slide 20: Executive summary
Executive summary Vincent A. Forlenza Chairman and CEO 2 0 © 2019 BD. BD and the BD Logo are trademarks of Becton, Dickinson and Company.
Slide 21: FY 2020 Planned Product Launches
FY 2020 Planned Product Launches Medical Life Sciences Interventional • BD Provena™ Solo • BD Eclipse™ Ultrafill blood • SureStep™ Vacutainer® collection safety needle • BD Provena™ Midline Catheter • Ultraverse™ 014 and 018 with Max Barrier+ Kits • BD Synapsys™ 3.1 • Lutonix® AV low profile • BD Po
Slide 22: Key takeaways
Key takeaways • Strong operating performance to finish FY 2019 • Balanced growth across all three segments continues to demonstrate the breadth and depth of the portfolio • Bard integration and synergy capture on track • Confident in delivering on the 3rd year of the Bard deal model • Focused on exe
Slide 23: Advancing the world of health
<3 BD Advancing the world of health
Slide 24: Our focus on sustainable performance
Our focus on sustainable performance Addressing unmet societal needs through business models and initiatives that also contribute to the commercial success of BD. Developing new products and Providing access to affordable solutions that improve medical technologies to resource outcomes, reduce syste
Slide 25: Recognized for making an impact
Recognized for making an impact Fortune World’s Most Admired Companies CR Magazine’s 100 Best Corporate Citizens Forbes America’s Best Employers by State (MD, NJ and UT) 25 © 2019 BD. BD and the BD Logo are trademarks of Becton, Dickinson and Company.
Slide 26: FY 2019 Planned Product Launches
FY 2019 Planned Product Launches Medical Life Sciences Interventional • BD PhaSeal™ Optima (US) • BD MAX™ – Enteric Viral Panel • Covera™ stent graft (fistula (US) indication) • IV Solutions – 0.45% sodium chloride and lactated ringers • BD Phoenix™ CPO Detect (US) • Venovo™ (large diameter ® venous
Slide 27: FY 2019 guidance and actuals
FY 2019 guidance and actuals As adjusted August Guidance FY 2019 Actuals BD Comparable Revenues FXN % Growth(1) 5.0% to 6.0% 5.1% Revenue – FX Impact (~2.5%) (2.2%) BD Reported Revenues 8% to 9% 8.2% Gross margin 56% to 57% 56.1% SSG&A (% of sales) 24.5% to 25.5% 25.1% R&D (% of sales) ~6.0% 5.8% Op
Slide 28: FY 2018 adjusted EPS results
FY 2018 adjusted EPS results 12.3% FXN Growth 16.1% Growth ~4% ~16% ~4% $11.01 Better revenues ~3% (~3%) Interest expense ~1% Unfavorable Year-over- (~5%) Year tax rate (~2%) Resins and other raw materials (~1%) $9.48 US Dispensing change (~2.5%) Divestitures & acquisitions (~1.5%) Incremental reven
Slide 29: Q4 FY 2019 & Q4 FY 2018 Adjustment Reconciliations
Q4 FY 2019 & Q4 FY 2018 Adjustment Reconciliations Three Months Ended September 30, 2019 Other Selling and Research and Acquisitions Operating Interest Other Income Diluted Administrative Development and Other (Income) Operating Income Income, Tax Earnings Revenues Gross Profit Expense Expense Restr
Slide 30: FY 2019 & FY 2018 Adjustment Reconciliations
FY 2019 & FY 2018 Adjustment Reconciliations Twelve Months Ended September 30, 2019 Other Selling and Research and Acquisitions Operating Interest Other Income Diluted Administrative Development and Other (Income) Operating Income Income, Tax Earnings Revenues Gross Profit Expense Expense Restructur
Slide 31: Q4 FY 2019 Reconciliation of Reported Diluted EPS to Adjusted
Q4 FY 2019 Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS 31 © 2019 BD. BD and the BD Logo are trademarks of Becton, Dickinson and Company.
Slide 32: FY 2019 Reconciliation of Reported Diluted EPS to Adjusted
FY 2019 Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS 32 © 2019 BD. BD and the BD Logo are trademarks of Becton, Dickinson and Company.
Slide 33: FY 2019 Reconciliation – FX Impact Emerging, Developed Markets & China
FY 2019 Reconciliation – FX Impact Emerging, Developed Markets & China A B C=A+B D E F Divestiture H=D+E+F+G I=(A-D)/D J K=(C-H-J)/H BD Divestiture BD Intercompany and Other Reported Adjustments Comparable Reported Bard Q1 (b) Adjustment Adjustments Comparable % Rptd FX Impact FXN % 2019 (a) 2019 20
Slide 34: FY 2019 Operating Cash Flow Reconciliation
FY 2019 Operating Cash Flow Reconciliation (Unaudited, Amounts in billions) Reported Operating Cash Flow $ 3.3 Adjustments (excludes non-cash items) Restructuring costs 0.1 Transaction & Integration costs 0.3 Transaction gain/loss and product liability-related impacts 0.1 Other 0.2 Tax impact relate
Slide 35: FY 2020 EPS Outlook Reconciliation
FY 2020 EPS Outlook Reconciliation FY2019 FY2020 Outlook Revenues % Change FX Impact % Change FXN BDX Revenue $ 17,290 4.0% to 4.5% ~1.0% 5.0% to 5.5% FY2020 Outlook Full Year FY2020 Outlook Full Year FY2019 % Increase Adjusted Fully Diluted Earnings per Share $ 12.50 to 12.65 $ 11.68 7.0% to 8.5% E
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