Revenue up 13 Percent as Reported, 11 Percent Excluding Foreign Exchange
MURRAY HILL, N.J.--(BUSINESS WIRE)--C. R. Bard, Inc. (NYSE: BCR) today reported 2008 third quarter
financial results. Third quarter 2008 net sales were $616.8 million,
an increase of 13 percent over the prior-year period. Excluding the
impact of foreign exchange, third quarter 2008 net sales increased 11
percent over the prior-year period.
For the third quarter 2008, net sales in the U.S. were $419.5
million and net sales outside the U.S. were $197.3 million, an
increase of 11 percent and 18 percent, respectively, over the
prior-year period. Excluding the impact of foreign exchange, third
quarter 2008 net sales outside the U.S. increased 11 percent over the
prior-year period.
For the third quarter 2008, net income was $111.2 million and
diluted earnings per share were $1.09, an increase of 9 percent and 14
percent, respectively, as compared to third quarter 2007 results.
Adjusting for items that affect comparability between periods as
detailed in the tables below, third quarter 2008 net income was $112.4
million and diluted earnings per share were $1.10, an increase of 14
percent and 18 percent, respectively, as compared to third quarter
2007 results.
Timothy M. Ring, chairman and chief executive officer, commented,
"Bard's performance this quarter was solid from the top down. Our
broad product portfolio delivered another quarter of strong revenue
growth while expanded margins helped us achieve adjusted EPS above our
14 percent growth target. Our dedicated employees, innovative products
and disciplined financial management are great assets that position us
well in a turbulent economic environment."
C. R. Bard, Inc. (www.crbard.com), headquartered in Murray Hill,
NJ, is a leading multinational developer, manufacturer and marketer of
innovative, life-enhancing medical technologies in the fields of
vascular, urology, oncology and surgical specialty products.
This press release may contain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995,
which are based on management's current expectations, the accuracy of
which is necessarily subject to risks and uncertainties. These
statements are not historical in nature and use words such as
"anticipate," "estimate," "expect," "project," "intend," "forecast,"
"plan," "believe," and other words of similar meaning in connection
with any discussion of future operating or financial performance. Many
factors may cause actual results to differ materially from anticipated
results including product developments, sales efforts, income tax
matters, the outcomes of contingencies such as legal proceedings, and
other economic, business, competitive and regulatory factors. The
company undertakes no obligation to update its forward-looking
statements. Please refer to the Cautionary Statement Regarding
Forward-Looking Information in our June 30, 2008 Form 10-Q for more
detailed information about these and other factors that may cause
actual results to differ materially from those expressed or implied.
C.R. Bard, Inc.
Consolidated Statements of Income
(dollars in thousands except per share amounts, unaudited)
Quarter Ended Nine Months Ended
September 30, September 30,
------------------- ----------------------
2008 2007 2008 2007
--------- --------- ---------- -----------
Net sales $616,800 $544,800 $1,817,900 $1,618,700
Costs and expenses
Cost of goods sold 239,500 213,700 708,600 636,800
Marketing, selling &
administrative expense 180,600 160,900 530,300 475,100
Research and development
expense 35,100 34,000 159,100 99,200
Interest expense 3,100 2,900 9,100 8,800
Other (income) expense ,
net (1,900) (8,900) 26,700 (25,100)
--------- --------- ---------- -----------
Total costs and expenses 456,400 402,600 1,433,800 1,194,800
--------- --------- ---------- -----------
Income from continuing
operations before income
taxes 160,400 142,200 384,100 423,900
--------- --------- ---------- -----------
Income tax provision 49,200 40,100 117,000 122,700
--------- --------- ---------- -----------
Income from continuing
operations 111,200 102,100 267,100 301,200
--------- --------- ---------- -----------
Income from discontinued
operations - - - -
--------- --------- ---------- -----------
Net income $111,200 $102,100 $ 267,100 $ 301,200
========= ========= ========== ===========
Basic earnings per share:
Income from continuing
operations $ 1.12 $ 0.99 $ 2.68 $ 2.92
Net income per share $ 1.12 $ 0.99 $ 2.68 $ 2.92
========= ========= ========== ===========
Diluted earnings per share:
Income from continuing
operations $ 1.09 $ 0.96 $ 2.60 $ 2.83
Net income per share $ 1.09 $ 0.96 $ 2.60 $ 2.83
========= ========= ========== ===========
Wt. avg. common shares
outstanding - basic 99,300 102,700 99,600 103,100
Wt. avg. common shares
outstanding - diluted 102,300 105,900 102,700 106,400
Product Group Summary of Net Sales
(dollars in thousands, unaudited)
Quarter Ended September 30,
---------------------------------
Constant
2008 2007 Change Currency
---------------------------------
Vascular $160,600 $134,100 20% 15%
Urology 174,500 166,400 5% 4%
Oncology 169,300 140,900 20% 18%
Surgical Specialties 90,800 83,400 9% 7%
Other 21,600 20,000 8% 8%
-----------------
Net sales $616,800 $544,800 13%
-----------------
FX impact 10,900
-----------------
Constant Currency $616,800 $555,700 11%
=================
Nine Months Ended September 30,
--------------------------------------
Constant
2008 2007 Change Currency
--------------------------------------
Vascular $ 474,600 $ 397,700 19% 14%
Urology 519,600 482,500 8% 6%
Oncology 483,000 410,600 18% 15%
Surgical Specialties 272,700 267,000 2% -
Other 68,000 60,900 12% 11%
---------------------
Net sales $1,817,900 $1,618,700 12%
---------------------
FX impact 39,100
---------------------
Constant Currency $1,817,900 $1,657,800 10%
=====================
Reconciliation of Earnings
(dollars in millions except per share amounts, unaudited)
Quarter Ended September 30, 2008
---------------------------------
Cost of Research & Other
Goods Development (Income)
Sold Expense Expense, Net
------- ----------- -------------
GAAP Basis $239.5 $ 35.1 $ (1.9)
Items that affect comparability of
results between periods:
------------------------------------
Reorganization costs - - (1.3)
Gain on asset sale - - 0.7
Tax adjustment - - -
------- ----------- -------------
Total - - (0.6)
------- ----------- -------------
Adjusted Basis $239.5 $ 35.1 $ (2.5)
======= =========== =============
Quarter Ended September 30, 2007
---------------------------------
Cost of Research & Other
Goods Development (Income)
Sold Expense Expense, Net
------- ----------- -------------
GAAP Basis $213.7 $ 34.0 $ (8.9)
Items that affect comparability of
results between periods:
------------------------------------
Tax adjustment - - -
------- ----------- -------------
Total - - -
------- ----------- -------------
Adjusted Basis $213.7 $ 34.0 $ (8.9)
======= =========== =============
Nine Months Ended September 30,
2008
---------------------------------
Cost of Research & Other
Goods Development (Income)
Sold Expense Expense, Net
------- ----------- -------------
GAAP Basis $708.6 $159.1 $ 26.7
Items that affect comparability of
results between periods:
------------------------------------
Asset disposition (3.7) - (36.8)
Reorganization costs - - (1.3)
Purchased research & development - (49.3) -
Gain on asset sale - - 0.7
Tax adjustment - - -
------- ----------- -------------
Total (3.7) (49.3) (37.4)
------- ----------- -------------
Adjusted Basis $704.9 $109.8 $(10.7)
======= =========== =============
Nine Months Ended September 30,
2007
---------------------------------
Cost of Research & Other
Goods Development (Income)
Sold Expense Expense, Net
------- ----------- -------------
GAAP Basis $636.8 $ 99.2 $(25.1)
Items that affect comparability of
results between periods:
------------------------------------
Purchased research & development - (1.6) -
Tax adjustment - - -
------- ----------- -------------
Total - (1.6) -
------- ----------- -------------
Adjusted Basis $636.8 $ 97.6 $(25.1)
======= =========== =============
* Items may not add due to rounding.
Quarter Ended September 30,
2008
-----------------------------
Income
Tax Net Diluted
Provision Income Earnings
(Benefit) (Loss) Per Share
--------- ------- ---------
GAAP Basis $ 49.2 $111.2 $ 1.09
Items that affect comparability of
results between periods:
-----------------------------------------
Reorganization costs 0.5 0.8
Gain on asset sale (0.1) (0.6)
Tax adjustment (1.0) 1.0
--------- ------- ---------
Total (0.6) 1.2 0.01
--------- ------- ---------
Adjusted Basis $ 48.6 $112.4 $ 1.10
========= ======= =========
Quarter Ended September 30,
2007
-----------------------------
Income
Tax Net Diluted
Provision Income Earnings
(Benefit) (Loss) Per Share
--------- ------- ---------
GAAP Basis $ 40.1 $102.1 $ 0.96
Items that affect comparability of
results between periods:
-----------------------------------------
Tax adjustment 3.7 (3.7)
--------- ------- ---------
Total 3.7 (3.7) (0.03)
--------- ------- ---------
Adjusted Basis $ 43.8 $ 98.4 $ 0.93
========= ======= =========
Nine Months Ended September
30, 2008
-----------------------------
Income
Tax Net Diluted
Provision Income Earnings
(Benefit) (Loss) Per Share
--------- ------- ---------
GAAP Basis $117.0 $267.1 $ 2.60
Items that affect comparability of
results between periods:
-----------------------------------------
Asset disposition 5.6 34.9
Reorganization costs 0.5 0.8
Purchased research & development 18.2 31.1
Gain on asset sale (0.1) (0.6)
Tax adjustment (1.0) 1.0
--------- ------- ---------
Total 23.2 67.2 0.65
--------- ------- ---------
Adjusted Basis $140.2 $334.3 $ 3.26*
========= ======= =========
Nine Months Ended September
30, 2007
-----------------------------
Income
Tax Net Diluted
Provision Income Earnings
(Benefit) (Loss) Per Share
--------- ------- ---------
GAAP Basis $122.7 $301.2 $ 2.83
Items that affect comparability of
results between periods:
-----------------------------------------
Purchased research & development 0.1 1.5
Tax adjustment 3.7 (3.7)
--------- ------- ---------
Total 3.8 (2.2) (0.02)
--------- ------- ---------
Adjusted Basis $126.5 $299.0 $ 2.81
========= ======= =========
* Items may not add due to rounding.
Notes to Reconciliation of Earnings
- For the third quarter 2008, the following items affected the
comparability of results between periods: (i) a charge of $1.3
million pretax for reorganization costs; (ii) a gain of $0.7
million pretax associated with the sale of an asset; and (iii)
an increase of $1.0 million in the income tax provision due to
a tax-related interest adjustment. The net effect of these
items decreased net income by $1.2 million, or $0.01 diluted
earnings per share.
- For the third quarter 2007, a reduction in the income tax
provision of $3.7 million for changes in certain statutory tax
rates outside the United States that resulted in the
revaluation of deferred taxes affected the comparability of
results between periods. The effect of this item increased net
income by $3.7 million, or $0.03 diluted earnings per share.
- For the nine months ended September 30, 2008, the following
items affected the comparability of results between periods:
(i) a charge of $40.5 million pretax for an asset disposition;
(ii) a charge of $1.3 million pretax for reorganization costs;
(iii) a charge of $49.3 million pretax for purchased research
and development; (iv) a gain of $0.7 million pretax associated
with the sale of an asset; and (v) an increase of $1.0 million
in the income tax provision due to a tax-related interest
adjustment. The net effect of these items decreased net income
by $67.2 million, or $0.65 diluted earnings per share.
- For the nine months ended September 30, 2007, the following
items impacted the comparability of results between periods:
(i) a charge of $1.6 million pretax for purchased research and
development; and (ii) a reduction in the income tax provision
of $3.7 million due to changes in certain statutory tax rates
outside the United States that resulted in the revaluation of
deferred taxes. The net effect of these items increased net
income by $2.2 million, or $0.02 diluted earnings per share.
This press release contains financial measures that are not
calculated in accordance with United States generally accepted
accounting principles (GAAP). These non-GAAP financial measures are
reconciled to their most directly comparable GAAP measures in the
above tables.
This press release includes net sales excluding the impact of
foreign exchange. The company analyzes net sales on a constant
currency basis to better measure the comparability of results between
periods. Because changes in foreign currency exchange rates have a
non-operating impact on net sales, the company believes that
evaluating growth in net sales on a constant currency basis provides
an additional and meaningful assessment of net sales to both
management and the company's investors.
In addition, this press release includes the following non-GAAP
measures: (1) cost of goods sold excluding a charge for an asset
disposition; (2) research & development expense excluding payments for
purchased research and development; (3) other (income) expense, net
excluding charges for an asset disposition and reorganization costs as
well as a gain on an asset sale; (4) income tax provision excluding an
increase related to a tax-related interest adjustment, a reduction
related to changes in statutory tax rates and the tax effect of the
items set forth in (1) through (3) above; (5) net income excluding the
items set forth in (1) through (4) above; and (6) diluted earnings per
share excluding the items set forth in (1) through (4) above.
The company excluded the items described above because they may
cause certain statements of income categories not to be indicative of
ongoing operating results, and therefore affect the comparability of
results between periods. The company therefore believes that these
non-GAAP measures provide an additional and meaningful assessment of
the company's ongoing operating performance. Because the company has
historically reported these non-GAAP results to the investment
community, management also believes that the inclusion of these
non-GAAP measures provides consistency in its financial reporting and
facilitates investors' understanding of the company's historic
operating trends by providing an additional basis for comparisons to
prior periods. Management uses these non-GAAP measures: (1) to
establish financial and operational goals; (2) to monitor the
company's actual performance in relation to its business plan and
operating budgets; (3) to evaluate the company's core operating
performance and understand key trends within the business; and (4) as
part of several components it considers in determining incentive
compensation.
Management recognizes that the use of these non-GAAP measures has
limitations, including the fact that they may not be comparable with
similar non-GAAP financial measures used by other companies and that
management must exercise judgment in determining which types of
charges or other items should be excluded from the non-GAAP financial
information. Management compensates for these limitations by providing
full disclosure of each non-GAAP financial measure and a
reconciliation to the most directly comparable GAAP financial measure.
All non-GAAP financial measures are intended to supplement the
applicable GAAP disclosures and should not be considered in isolation
from, or as a replacement for, financial information prepared in
accordance with GAAP. For a reconciliation of these non-GAAP measures
to the most comparable GAAP measures, please see the above tables.
Source: C. R. Bard, Inc.
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