Press Release

FRANKLIN LAKES, N.J., Nov. 6, 2018 /PRNewswire/ -- BD (Becton, Dickinson and Company) (NYSE: BDX), a leading global medical technology company, today reported quarterly revenues of $4.402 billion for the fourth fiscal quarter ended September 30, 2018.  This represents an increase of 39.0 percent from the prior-year period, which is primarily due to the acquisition of C. R. Bard.  On a comparable, currency-neutral basis that includes the revenues of C. R. Bard in the current and prior year, fourth quarter revenues increased 8.4 percent over the prior-year period.  For the full fiscal year ended September 30, 2018, revenues of $15.983 billion increased 32.2 percent from the prior-year period, primarily due to the acquisition of C. R. Bard.  On a comparable, currency-neutral basis that includes the revenues of C. R. Bard in the current and prior year, full fiscal year revenues of $16.930 billion grew 5.8 percent.  This includes an estimated 60 basis point adverse impact from the previously disclosed change in the U.S. dispensing business model and the estimated sales impact from Hurricane Maria in Puerto Rico on Bard's business during BD's first fiscal quarter.

"Fiscal 2018 was a historic year for BD with the successful completion of the acquisition of C. R. Bard.  We are extremely proud of our strong fourth quarter and fiscal year results, which demonstrate how agile we can be as an organization while executing concurrently on two transformative acquisitions," said Vincent A. Forlenza, Chairman and CEO.  "We enter fiscal 2019 with continued strong momentum and confidence in our ability to execute on our strategy, deliver on our commitments and create value for our shareholders."  

Fourth Quarter and Twelve-Month Fiscal 2018 Operating Results
As reported, diluted earnings per share for the fourth quarter were $(0.64), compared with $1.24 in the prior-year period.  This represents a decrease of 151.6 percent and is primarily due to purchase accounting expenses relating to acquisitions and additional tax expense relating to new U.S. tax legislation.  Adjusted diluted earnings per share were $2.93, compared with $2.40 in the prior-year period.  This represents an increase in adjusted diluted earnings per share of 22.1 percent, or 24.6 percent on a currency-neutral basis.

For the twelve-month period ended September 30, 2018, as reported, diluted earnings per share were $0.60, compared with $4.60 in the prior-year period.  This represents a decrease of 87.0 percent and is primarily due to purchase accounting and other expenses relating to acquisitions and additional tax expense relating to new U.S. tax legislation, offset by a non-cash charge in the prior year related to the change in the U.S. dispensing model.  Adjusted diluted earnings per share were $11.01, compared with $9.48 in the prior-year period.  This represents an increase in adjusted diluted earnings per share of 16.1 percent, or 12.3 percent on a currency-neutral basis.  

Segment Results
In the BD Medical segment, as reported, worldwide revenues for the quarter of $2.346 billion increased 20.8 percent over the prior-year period, primarily due to the acquisition of C. R. Bard.  On a comparable, currency-neutral basis, BD Medical revenues increased 10.1 percent over the prior-year period.  The segment's results were driven by strong performance in the Medication Management Solutions, Medication Delivery Solutions and Pharmaceutical Systems units.

For the twelve-month period ended September 30, 2018, BD Medical revenues were $8.616 billion as reported, an increase of 16.1 percent over the prior-year period.  On a comparable, currency-neutral basis, BD Medical revenues of $8.826 billion increased 5.6 percent over the prior-year period, which includes an estimated 80 basis point adverse impact from the change in the U.S. dispensing business model.

In the BD Life Sciences segment, as reported, worldwide revenues for the quarter were $1.108 billion, an increase of 5.5 percent over the prior-year period, or 6.9 percent on a currency-neutral basis.  Revenue growth reflects strong performance across the segment.

For the twelve-month period ended September 30, 2018, BD Life Sciences revenues were $4.330 billion as reported, an increase of 8.6 percent over the prior-year period, or an increase of 6.8 percent on a currency-neutral basis.

In the BD Interventional segment, as reported, worldwide revenues for the quarter were $0.948 billion.  On a comparable, currency-neutral basis, revenues increased 6.0 percent over the prior-year period.  The segment's results reflect strong performance in the Peripheral Intervention and Urology and Critical Care units.

For the twelve-month period ended September 30, 2018, BD Interventional revenues were $3.037 billion as reported.  On a comparable, currency-neutral basis, BD Interventional revenues of $3.774 billion increased 5.2 percent, which includes an estimated 90 basis point adverse impact from Hurricane Maria in Puerto Rico on Bard's business during BD's first fiscal quarter.

Geographic Results
As reported, fourth quarter revenues in the U.S. of $2.448 billion increased 48.9 percent over the prior-year period, primarily due to the acquisition of C. R. Bard.  On a comparable basis, U.S. revenues increased 8.7 percent over the prior-year period.  Growth in the U.S. was primarily driven by very strong performance in the Medication Management Solutions and Pharmaceutical Systems units within the BD Medical segment.

As reported, revenues outside of the U.S. of $1.954 billion increased 28.4 percent from the prior-year period, primarily due to the acquisition of C. R. Bard.  On a comparable, currency-neutral basis, revenues outside of the U.S. increased 7.9 percent over the prior-year period.  International revenue growth was driven by strong performance from all three segments.

For the twelve-month period ended September 30, 2018, U.S. revenues were $8.768 billion as reported, an increase of 34.8 percent over the prior-year period.  On a comparable basis, U.S. revenues of $9.364 billion increased 5.0 percent over the prior-year period, which includes an estimated 100 basis point adverse impact from the change in the U.S. dispensing business model and Hurricane Maria.  As reported, revenues outside of the U.S. of $7.215 billion increased 29.1 percent over the prior-year period.  On a comparable, currency-neutral basis, revenues outside the U.S. of $7.566 billion increased 7.0 percent over the prior-year period.

Fiscal 2019 Outlook for Full Year
As reported, the company expects full fiscal year 2019 revenues to increase 8.5 to 9.5 percent, primarily due to the C. R. Bard acquisition.  The company estimates full fiscal year 2019 revenues will increase 5.0 to 6.0 percent on a comparable, currency-neutral basis that includes the revenues of C. R. Bard in fiscal 2019 as well as the full 2018 fiscal year.

The company expects adjusted diluted earnings per share to be between $12.05 and $12.15, resulting in growth of approximately 13.0 to 14.0 percent on a currency-neutral basis, which includes an adverse impact of approximately 600 basis points related to headwinds and divestitures.  This represents growth of approximately 10.0 percent including the estimated unfavorable impact of foreign currency over fiscal 2018 adjusted diluted earnings per share of $11.01.  Fiscal 2019 earnings per share expectations include high-single digit accretion from the C. R. Bard acquisition.

Estimated adjusted diluted earnings per share for fiscal 2019 includes an estimate of the impact of adopting ASU 2014-09, Revenue from Contracts with Customers, as of October 1, 2018, and 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, and certain tax, litigation and regulatory compliance matters.  BD does not attempt to provide reconciliations of forward-looking non-GAAP earnings 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.

Conference Call Information
A conference call regarding BD's fourth quarter results will be broadcast live on BD's website, www.bd.com/investors, along with related slides, at 8:00 a.m. (ET)Tuesday, November 6, 2018.  The conference call will be available for replay on BD's website, www.bd.com/investors, or at 1-800-585-8367 (domestic) and 1-404-537-3406 (international) through the close of business on Tuesday, November 13, 2018, confirmation number 3197559.

Non-GAAP Financial Measures/Financial Tables
This news release contains certain non-GAAP financial measures.  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. 

All "comparable" basis revenue growth rates relating to fiscal years 2018 and 2019 presented throughout this release include the results of C. R. Bard, Inc. ("Bard") in the current and prior-year periods and are further adjusted for certain items as detailed in the attached tables. Beginning in the second quarter of fiscal year 2018, the company's organizational structure was based upon three principal business segments: BD Medical ("Medical"), BD Life Sciences ("Life Sciences") and BD Interventional ("Interventional").  The Interventional segment was added upon the company's completion of its acquisition of Bard, and this new segment includes the majority of Bard's product offerings and certain product offerings which were previously reported in the Medical segment.  Certain of Bard's product offerings are included under the Company's Medical segment, specifically within the new Medication Delivery Solutions unit, which was formerly the Medical segment's Medication and Procedural Solutions unit.  Prior-year amounts have been revised to reflect the movement of certain product offerings which were previously reported in the Medical segment and which are now reported in the Interventional segment, as discussed above.  Current and prior-year adjusted diluted earnings per share results exclude, among other things, the impact of purchase accounting adjustments (including the non-cash amortization of acquisition-related intangible assets); integration, restructuring and transaction costs; the reversal of a litigation reserve; and the loss on debt extinguishment.  These measures are also provided on a currency-neutral basis after eliminating the effect of foreign currency translation, where applicable.  Foreign currency-neutral percentages are calculated by converting the current-period local currency financial results using the prior period foreign currency exchange rates and comparing these adjusted amounts to the current-period results.  Reconciliations of these amounts to the most directly comparable GAAP measures are included in the tables at the end of this release.  As previously announced, comparable historical revenue schedules inclusive of Bard for BD's 2016 and 2017 fiscal years, and the first quarter of BD's 2018 fiscal year, are available on the Investor page of BD's website, www.bd.com/investors.

About BD
BD is one of the largest global medical technology companies in the world and is advancing the world of health by improving medical discovery, diagnostics and the delivery of care.  The company supports the heroes on the frontlines of health care by developing innovative technology, services and solutions that help advance both clinical therapy for patients and clinical process for health care providers.  BD and its 65,000 employees have a passion and commitment to help improve patient outcomes, improve the safety and efficiency of clinicians' care delivery process, enable laboratory scientists to better diagnose disease and advance researchers' capabilities to develop the next generation of diagnostics and therapeutics. BD has a presence in virtually every country and partners with organizations around the world to address some of the most challenging global health issues.  By working in close collaboration with customers, BD can help enhance outcomes, lower costs, increase efficiencies, improve safety and expand access to health care.  In 2017, BD welcomed C. R. Bard and its products into the BD family.  For more information on BD, please visit bd.com.

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This press release, including the section entitled "Fiscal 2019 Outlook for Full Year", contains certain estimates and other forward-looking statements (as defined under Federal securities laws) regarding BD's performance, including future revenues and earnings per share.  All such statements are based upon current expectations of BD and involve a number of business risks and uncertainties.  Actual results could vary materially from anticipated results described, implied or projected in any forward-looking statement.  With respect to forward-looking statements contained herein, a number of factors could cause actual results to vary materially.  These factors include, but are not limited to: risks relating to the integration of the C.R. Bard operations, products and employees into BD and the possibility that the anticipated synergies and other benefits of the proposed acquisition will not be realized or will not be realized within the expected timeframe; uncertainty regarding the impact of the recent U.S. tax reform; legislative or regulatory changes to the U.S. healthcare system, potential cuts in governmental healthcare spending or measures to contain healthcare costs, each of which could result in reduced demand for our products or downward pricing pressure; changes in interest or foreign currency exchange rates; adverse changes in regional, national or foreign economic conditions, particularly in emerging markets, including any impact on our ability to access credit markets and finance our operations, the demand for our products and services, utilization rates or otherwise, or our suppliers' ability to provide products needed for our operations; new or changing laws and regulations impacting our business (including the imposition of tariffs or changes in laws impacting international trade) or changes in enforcement practices with respect to such laws; our ability to successfully integrate any businesses we acquire; the adverse impact of cyber-attacks on our information systems or products; competitive factors including technological advances and new products introduced by competitors; interruptions in our supply chain or manufacturing processes; pricing and market pressures; difficulties inherent in product development, delays in product introductions and uncertainty of market acceptance of new products; adverse changes in geopolitical conditions; increases in energy costs and their effect on, among other things, the cost of producing BD's products; product efficacy or safety concerns resulting in product recalls or actions being taken by the FDA or other regulators; fluctuations in costs and availability of raw materials and in BD's ability to maintain favorable supplier arrangements and relationships; risks relating to our ability to continue to successfully integrate CareFusion's operations in order to fully obtain the benefits of the transaction; uncertainties of litigation (as described in BD's filings with the Securities and Exchange Commission); future healthcare reform outside the U.S., including changes in government pricing and reimbursement policies or other cost containment reforms; and issuance of new or revised accounting standards, as well as other factors discussed in BD's filings with the Securities and Exchange Commission.  We do not intend to update any forward-looking statements to reflect events or circumstances after the date hereof except as required by applicable laws or regulations.