Slide 1: Q3 2023 Earnings Conference Call
Q3 2023 Earnings Conference Call Financial Results & Outlook November 13, 2023
Slide 2: Cautionary Note Regarding Forward-Looking Statements and Use of Non-GAAP Financial Information
Cautionary Note Regarding Forward-Looking Statements and Use of Non-GAAP Financial Information In accordance with the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995, we provide the following cautionary remarks regarding important factors that, among others, could ca
Slide 3: Key Takeaways
Key Takeaways Solid financial results for the third quarter, achieving good total sales growth and non-GAAP diluted EPS growth driven by our technology, value-added services and dental specialty products Lowering full-year 2023 guidance to a range of $4.43 to $4.71 reflecting softening macroeconomic
Slide 4: Q3 Financial and Operational Highlights
Q3 Financial and Operational Highlights Worldwide Sales Growth 3.1% Non-GAAP Diluted EPS* Global Dental Sales Growth $1.32 6.3% Driven by strength in Technology & Value- Added Services despite continued lower sales Reflecting solid core business growth When excluding sales of PPE products of PPE pro
Slide 5: Consolidated Results
Q3 FY2023 Consolidated Results* Q3 2023 Q3 2022 Q3 2023 Q3 2022 BY GEOGRAPHY (in millions of USD except EPS) (GAAP) (GAAP) (Non-GAAP) (Non-GAAP) Total Sales $3,162 $3,067 $3,162 $3,067 9% Rest of the World Operating Income $200 $211 $255 $252 16% Europe Operating Margin 6.34% 6.86% 8.09% 8.21% 75% N
Slide 6: Worldwide Sales Summary
Q3 FY2023 Worldwide Sales Summary (in millions of USD) Q3 2023 Q3 2022 y/y ∆ y/y LCI* ∆ Global Dental $1,882 $1,785 5.4% -0.2% Excl. PPE 6.3% 0.3% Global Medical 1,070 1,106 -3.1% -4.6% Excl. PPE/COVID-19 Test Kits 2.5% 0.8% Global Technology/VAS 210 176 18.8% 9.6% Total Sales $3,162 $3,067 3.1% -1.
Slide 7: Progress on BOLD+1 Strategic Priorities
Progress on BOLD+1 Strategic Priorities Objective Update • Biotech Dental and S.I.N. Implant System acquisitions accelerate the BUILD complementary software, specialty, and services businesses implementation of our strategy, adding high-growth, high-margin products and services businesses to our off
Slide 8: Value Creation Through Focused M&A
Value Creation Through Focused M&A Expands complementary Invests for Annual high-growth software, growth in core 2023 Acquisitions Strategic Rationale Expected Outcome specialty and services distribution Revenue businesses business • Expands dental implant, • Market leader in France clear aligner bu
Slide 9: Balanced Capital Allocation Strategy
Balanced Capital Allocation Strategy Disciplined Approach to Balance Sheet Management 1.39x Debt-to-EBITDA ratio as of September 30, 2023 ~$2.3B Available borrowing capacity as of September 30, 2023 Maintain investment grade balance sheet Acquisitions $1.0B+ Committed YTD Strong balance sheet provid
Slide 10: Acquisition Expenses and Acquisition-Related Adjustments
Acquisition Expenses and Acquisition-Related Adjustments 2023 QTD & YTD (in millions of USD except EPS) Q3 2023 YTD 2023 Operating Income EPS Operating Income EPS Acquisition Expenses* ($5) ($0.04) ($18) ($0.12) Acquisition-Related Fair Value Adjustments** (4) ($0.01) 12 $0.08 Total Acquisition Expe
Slide 11: Financial Guidance – Full Year 2023
Financial Guidance – Full Year 2023 We are narrowing the range of our guidance for 2023 non-GAAP diluted EPS for the underlying business to $5.18 to $5.26 from $5.18 to $5.35 previously, reflecting softening macroeconomic conditions. Additionally, we estimate a business interruption impact from the
Slide 12: Appendix
Appendix 12
Slide 13: Worldwide Financial Results
Q3 FY2023 Worldwide Financial Results* (in millions of USD except EPS) Q3 2023 Q3 2022 y/y ∆ Total Sales $3,162 $3,067 3.1% Gross Profit 995 914 8.8% Gross Margin 31.47% 29.81% +166 bps Operating Expenses (Non-GAAP)** 740 662 11.6% Operating Income (Non-GAAP)** $255 $252 1.6% Operating Margin (Non-G
Slide 14: Global Dental Sales Summary
Q3 FY2023 Global Dental Sales Summary (in millions of USD) Q3 2023 Q3 2022 y/y ∆ y/y LCI* ∆ North America Dental Consumables $866 $866 -0.1% -1.2% Excl. PPE 1.0% -0.1% North America Dental Equipment 268 265 1.2% 0.2% North America Dental $1,134 $1,131 0.2% -0.9% International Dental Consumables $599
Slide 15: Global Medical Sales Summary
Q3 FY2023 Global Medical Sales Summary (in millions of USD) Q3 2023 Q3 2022 y/y ∆ y/y LCI* ∆ North America Medical $1,044 $1,088 -4.1% -4.5% International Medical 26 18 57.1% -9.2% Global Medical $1,070 $1,106 -3.1% -4.6% Excl. PPE/COVID-19 Test Kits 2.5% 0.8% COVID-19 Test Kits (Worldwide) $44 $82
Slide 16: Technology/VAS Sales Summary
Q3 FY2023 Technology/VAS Sales Summary (in millions of USD) Q3 2023 Q3 2022 y/y ∆ y/y LCI* ∆ North America Technology/VAS $185 $155 19.0% 9.2% International Technology/VAS 25 21 17.7% 11.9% Global Technology/VAS $210 $176 18.8% 9.6% *LCI reflects internally generated sales in local currencies exclud
Slide 17: Technology/VAS + Dental Specialty Sales Summary
Q3 FY2023 Technology/VAS + Dental Specialty Sales Summary (in millions of USD) Q3 2023 Q3 2022 y/y ∆ Global Technology/VAS $210 $176 18.8% Global Dental Specialties* 268 214 24.8% Global Technology/VAS + Dental Specialties $477 $391 22.1% % of Total Sales 15.1% 12.7% *Dental Specialties consists of
Slide 18: PPE & COVID-19 Test Kit Sales Summary
Q3 FY2023 PPE & COVID-19 Test Kit Sales Summary (in millions of USD) Q3 2023 Q3 2022 y/y ∆ y/y LCI* ∆ Global Dental Consumables PPE $83 $93 -10.6% -10.2% Global Medical PPE 48 68 -30.4% -31.5% Total PPE $131 $161 -19.0% -19.2% COVID-19 Test Kits 44 82 -46.4% -46.4% Total PPE & COVID-19 Test Kits $17
Slide 19: GAAP & Non-GAAP Reconciliations
GAAP & Non-GAAP Reconciliations Q3 FY2023 Financial Highlights Henry Schein, Inc. Third Quarter 2023 Analyst Presentation Q3 2023 - Financial Highlights (in millions, except per share data) Reconciling Items Amortization Expense from GAAP Restructuring Costs Acquired Intangible Assets Non-GAAP Q3 20
Slide 20: GAAP & Non-GAAP Reconciliations
GAAP & Non-GAAP Reconciliations 2022 Financial Highlights Henry Schein, Inc. Third Quarter 2023 Analyst Presentation Full Year 2022 Financial Highlights (in millions, except per share data) Reconciling Items Amortization Expense Settlement and Net Gain on Sale of Impairment of from Acquired GAAP Res