PR Newswire
FRANKLIN LAKES, N.J., Feb. 1, 2024
Margin Execution Drives Better Performance in Quarter and Higher Guidance for Fiscal 2024
FRANKLIN LAKES, N.J., Feb. 1, 2024 /PRNewswire/ -- BD (Becton, Dickinson and Company) (NYSE: BDX), a leading global medical technology company, today announced results for its first quarter of fiscal 2024, which ended December 31, 2023.
"Our Q1 results reflect our team's strong execution of our BD 2025 strategy, in particular leveraging our broad portfolio of simplification programs to deliver both margin performance and cash flow ahead of our expectations," said Tom Polen, chairman, CEO and president of BD. "As we build on this momentum, advance our strong innovation pipeline and accelerate the adoption of our BD Excellence operating system, we are well-positioned to achieve our increased fiscal 2024 guidance and create sustained value for all stakeholders."
Recent Business and ESG Highlights
First Quarter Fiscal 2024 Operating Results
| | Three Months Ended | | Change | | Foreign | | Organic | ||
(Millions of dollars, except per share amounts) | | 2023 | | 2022 | | | | |||
Revenues | | $ 4,706 | | $ 4,586 | | 2.6 % | | 1.6 % | | 2.4 % |
| | | | | | | | | | |
Reported Diluted Earnings per Share | | $ 0.96 | | $ 1.70 | | (43.5) % | | (28.8) % | | |
Adjusted Diluted Earnings per Share1 | | $ 2.68 | | $ 2.98 | | (10.1) % | | (2.0) % | | |
| ||||||||||
1Represents a non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures included in the attached financial tables. |
Geographic Results
Revenues (Millions of dollars) | | Three Months Ended | | Reported Change | | Foreign Currency | ||
| | 2023 | | 2022 | | | ||
United States | | $ 2,749 | | $ 2,730 | | 0.7 % | | 0.7 % |
| | | | | | | | |
International | | $ 1,957 | | $ 1,856 | | 5.5 % | | 2.9 % |
| | | | | | | | |
Total Revenues | | $ 4,706 | | $ 4,586 | | 2.6 % | | 1.6 % |
| ||||||||
1Represents a non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures included in the attached financial tables. |
Segment Results
Revenues (Millions of dollars) | | Three Months Ended | | Reported | | Foreign | | Organic | ||
| | 2023 | | 2022 | | | | |||
BD Medical | | $ 2,230 | | $ 2,154 | | 3.5 % | | 2.4 % | | 2.4 % |
| | | | | | | | | | |
BD Life Sciences | | $ 1,288 | | $ 1,302 | | (1.0) % | | (2.5) % | | (2.5) % |
| | | | | | | | | | |
BD Interventional | | $ 1,188 | | $ 1,129 | | 5.2 % | | 4.7 % | | 8.4 % |
| | | | | | | | | | |
Total Revenues | | $ 4,706 | | $ 4,586 | | 2.6 % | | 1.6 % | | 2.4 % |
| ||||||||||
1Represents a non-GAAP financial measure; refer to reconciliations of non-GAAP financial measures included in the attached financial tables. |
The BD Medical segment includes the Medication Delivery Solutions (MDS), Medication Management Solutions (MMS), and Pharmaceutical Systems (PS) business units. BD Medical revenue growth was driven by MMS and PS.
The BD Life Sciences segment includes the Integrated Diagnostic Solutions (IDS) and Biosciences (BDB) business units. BD Life Sciences revenue reflects a decline in IDS that was partially offset by growth in BDB.
The BD Interventional segment includes the Surgery, Peripheral Intervention (PI), and Urology & Critical Care (UCC) business units. BD Interventional organic revenue growth was primarily driven by Surgery and UCC.
Assumptions and Outlook for Full Year Fiscal 2024
The company provided the following guidance with respect to fiscal 2024.
The company raised the lower end and midpoint of its fiscal 2024 organic revenue growth guidance range, and increased its adjusted diluted earnings per share guidance range.
BD's outlook for fiscal 2024 reflects numerous assumptions about many factors that could affect its business, based on the information management has reviewed as of this date. Management will discuss its outlook and several of its assumptions on its first fiscal quarter earnings call.
The company's expected adjusted diluted EPS for fiscal 2024 excludes potential charges or gains that may be recorded during the fiscal year, such as, among other things, the non-cash amortization of intangible assets, acquisition-related charges, spin-related costs, and certain tax matters. BD does not attempt to provide reconciliations of forward-looking adjusted diluted non-GAAP EPS guidance to the comparable GAAP measure because the impact and timing of these potential charges or gains is inherently uncertain and difficult to predict and is unavailable without unreasonable efforts. In addition, the company believes such reconciliations would imply a degree of precision and certainty that could be confusing to investors. Such items could have a substantial impact on GAAP measures of BD's financial performance. We also present our estimated revenue, organic revenue growth and adjusted diluted EPS growth for our 2024 fiscal year after adjusting for the anticipated impact of foreign currency translation. BD believes that this adjustment allows investors to better evaluate BD's anticipated underlying earnings performance for our 2024 fiscal year in relation to our underlying 2023 fiscal year performance.
Conference Call and Presentation Materials
BD will host an audio webcast today for the public, investors, analysts, and news media to discuss its first quarter results. The audio webcast will be broadcast live on BD's website, www.bd.com/investors at 8 a.m. (ET) Thursday, February 1, 2024. Accompanying slides will be available on BD's website, www.bd.com/investors at approximately 6:30 a.m. (ET). The conference call will be available for replay on BD's website, www.bd.com/investors. Alternatively, you can dial into the replay at 800-688-7339 (domestic) and 402-220-1347 (international) through the close of business on Thursday, February 8, 2024. A confirmation number is not needed to access the replay.
Non-GAAP Financial Measures/Financial Tables
This news release contains certain non-GAAP financial measures. These include revenue growth rates on a currency-neutral basis, adjusted diluted earnings per share and organic revenue growth rates on a currency-neutral basis. These non-GAAP financial measures are not in accordance with generally accepted accounting principles in the United States. BD management believes that the use of non-GAAP measures to adjust for items that are considered by management to be outside of BD's underlying operational results or that affect period to period comparability helps investors to gain a better understanding of our performance year-over-year, to analyze underlying trends in our businesses, to analyze our operating results, and understand future prospects. Management uses these non-GAAP financial measures to measure and forecast the company's performance, especially when comparing such results to previous periods or forecasts. We believe presenting such adjusted metrics provides investors with greater transparency to the information used by BD management for its operational decision-making and for comparison to other companies within the medical technology industry. Although BD's management believes non-GAAP results are useful in evaluating the performance of its business, its reliance on these measures is limited since items excluded from such measures may have a material impact on BD's net income, earnings per share or cash flows calculated in accordance with GAAP. Therefore, management typically uses non-GAAP results in conjunction with GAAP results to address these limitations. BD strongly encourages investors to review its consolidated financial statements and publicly filed reports in their entirety and cautions investors that the non-GAAP measures used by BD may differ from similar measures used by other companies, even when similar terms are used to identify such measures. Non-GAAP measures should not be considered replacements for, and should be read together with, the most comparable GAAP financial measures.
We present adjusted diluted earnings per share for the first quarter of fiscal year 2024, and the corresponding prior periods, after eliminating items we believe are not part of our ordinary operations and affect the comparability of the periods presented. Adjusted diluted earnings per share includes adjustments for the impact of purchase accounting adjustments, integration and restructuring costs, spin related costs, certain regulatory costs, certain product remediation costs, certain litigation-related items, certain investment gains and losses, certain asset impairment charges, and certain pension settlement costs. In particular, current and prior-year adjusted diluted earnings per share results exclude European regulatory initiative-related costs, which represent costs incurred to develop processes and systems to establish initial compliance with the European Union Medical Device Regulation and the European Union In Vitro Diagnostic Medical Device Regulation (collectively, the "New EU Medical Devices Regulations"), which represent a significant, unusual change to the existing regulatory framework. We consider the excluded European regulatory initiative-related costs to be duplicative of previously incurred costs and/or one-off costs related to establishing initial compliance with such regulatory regimes, and in each case are limited to a specific period of time. These expenses relate to establishing initial compliance with the New EU Medical Devices Regulations and include the cost of labor, other services and consulting (in particular, research and development and clinical trials) and supplies, travel and other miscellaneous costs. These costs were recorded in Cost of products sold and Research and development expense.
We also present revenue growth rates for the first quarter over the corresponding prior period on a currency-neutral basis after eliminating the effect of foreign currency translation, where applicable. We also show the growth in adjusted diluted earnings per share compared to the prior year period after eliminating the impact of foreign currency translation to further enable investors to evaluate BD's underlying earnings performance compared to the prior period. We calculate foreign currency-neutral percentages by converting our current-period local currency financial results using the prior period foreign currency exchange rates and comparing these adjusted amounts to our current-period results. As exchange rates are an important factor in understanding period-to-period comparisons, we believe the presentation of results on a foreign currency-neutral basis in addition to reported results helps improve investors' ability to understand our operating results and evaluate our performance in comparison to the prior period.
Reconciliations of these and other non-GAAP measures to the comparable GAAP measures are included in the attached financial tables. Within the attached financial tables presented, certain columns and rows may not add due to the use of rounded numbers. Percentages and earnings per share amounts presented are calculated from the underlying amounts.
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