Bard Announces Second Quarter Results; Revenue up 11 Percent as Reported, 12 Percent Excluding Foreign Exchange.MURRAY HILL Murray Hill may refer to one of the following places:
The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight were $498.2 million, an increase of 11 percent over the prior-year period. Excluding the impact of foreign exchange, second quarter 2006 net sales increased 12 percent over the prior-year period. For the second quarter 2006, net sales in the U.S. were $347.3 million and net sales outside the U.S. were $150.9 million, up 14 percent and 5 percent, respectively, over the prior-year period. Excluding the impact of foreign exchange, second quarter 2006 net sales outside the U.S. increased 8 percent over the prior-year period. For the second quarter 2006, net income was $81.4 million and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of were 76 cents. Net income and diluted earnings per share, as reported, were down 5 percent and 4 percent, respectively, as compared to second quarter 2005 results. Adjusting for certain items that affect comparability between periods, second quarter 2006 net income was $90.8 million and diluted earnings per share were 85 cents, up 13 percent and 15 percent, respectively, as compared to second quarter 2005 results on a comparable basis. Adjustments to the second quarter 2006 results (see the table below) included charges of $4.0 million (after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. ), or 4 cents per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, for share-based compensation under FAS 123R and $6.4 million (after-tax), or 6 cents per diluted share, for purchased R&D related to the acquisition of Venetec International, Inc. These charges were partially offset by investment gains of $1.0 million (after-tax), or 1 cent per diluted share. Adjustments to the second quarter 2005 results included certain items that increased net income by $5.1 million (after-tax), or 5 cents per diluted share. Timothy Timothy, epistles in the New Testament Timothy, two letters of the New Testament. With Titus they comprise the Pastoral Epistles, in which St. Paul addresses his coworkers as the guardians and transmitters of his teaching. M. Ring, chairman and chief executive officer, commented, "Results for the quarter were again strong. Revenue in all four of our businesses grew at or above our expectations reflecting the productivity of our new product pipeline. Our business model is allowing us to strategically reinvest re·in·vest tr.v. re·in·vest·ed, re·in·vest·ing, re·in·vests To invest (capital or earnings) again, especially to invest (income from securities or funds) in additional shares. in the company while still maintaining our full-year adjusted EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. growth target of a minimum of 14 percent. We continue to be pleased with the execution of our strategy, remaining focused on our goal to deliver double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. revenue growth." C. R. Bard, Inc. (www.crbard.com), headquartered in Murray Hill, N.J., is a leading multinational multinational Of, relating to, or being a company with subsidiaries or other operations in a number of countries. The diversity of operations of such companies subjects them to unique risks (for example, exchange rate changes or government nationalization) developer, manufacturer and marketer of innovative, life-enhancing medical technologies in the fields of vascular vascular /vas·cu·lar/ (vas´ku-ler) 1. pertaining to vessels, particularly blood vessels. 2. indicative of a copious blood supply. vas·cu·lar adj. , urology urology Medical specialty dealing with the urinary system and male reproductive organs. It traces its origin to medieval lithologists, itinerant healers who specialized in surgical removal of bladder stones. , oncology oncology /on·col·o·gy/ (ong-kol´ah-je) the sum of knowledge regarding tumors; the study of tumors. on·col·o·gy n. and surgical specialty surgical specialty A specialty of health care in which interventions constitute a significant component of Pt management Examples OB/GYN, ophthalmology, ENT, surgery–cardiothoracic, colorectal, general, neurologic, orthopedic, plastic, urology. products. This press release may contain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and 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 Contingencies (ISSN 1048-9851) is the bimonthly magazine of the American Academy of Actuaries, providing a large and diverse readership with general interest and technical articles on a wide range of issues related to the actuarial profession. such as legal proceedings All actions that are authorized or sanctioned by law and instituted in a court or a tribunal for the acquisition of rights or the enforcement of remedies. , and other economic, business, competitive and regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. factors. The company undertakes no obligation to update its forward-looking statements. Please refer to our March 31, 2006 10-Q for more detailed information about these and other factors that may cause actual results to differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. . Net sales, excluding foreign exchange, and net income and diluted earnings per share (EPS) excluding certain items that affect the comparability of results between periods are non-GAAP financial measures. 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. Net income and EPS excluding certain items are used by the company to measure the comparability of results between periods. Certain items such as investment gains, acquisition-related charges and litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. outcomes may not reflect underlying operating results, and other items such as the FAS 123R stock option expense may affect the comparability of results between periods. As a result, the company believes the exclusion exclusion /ex·clu·sion/ (eks-kloo´zhun) 1. a shutting out or elimination. 2. surgical isolation of a part, as of a segment of intestine, without removal from the body. of these and similar items provides an additional and meaningful assessment of net income and EPS. The limitation of these non-GAAP measures is that, by excluding certain items, they do not reflect results on a standardized standardized pertaining to data that have been submitted to standardization procedures. standardized morbidity rate see morbidity rate. standardized mortality rate see mortality rate. reporting basis. All non-GAAP financial measures are intended to supplement the applicable GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). disclosures and should not be viewed as a replacement for GAAP results. For a reconciliation of these non-GAAP measures to the most comparable GAAP measures, please see the attached tables.
C. R. Bard, Inc.
Consolidated Statements of Income
(in thousands except per share amounts, unaudited)
Quarter Ended Six Months Ended
June 30, June 30,
------------------- -------------------
2006 2005 2006 2005
--------- --------- --------- ---------
Net sales $498,200 $447,400 $965,700 $876,000
Costs and expenses:
Cost of goods sold 196,100 173,500 375,500 338,400
Marketing, selling &
administrative expense 153,500 136,000 296,100 264,600
Research & development
expense 37,100 29,000 75,700 56,200
Interest expense 4,500 3,100 9,200 6,200
Other (income) expense,
net (7,600) (11,500) (15,300) (17,900)
--------- ---------
Total costs and expenses 383,600 330,100 741,200 647,500
--------- --------- --------- ---------
Income before tax provision 114,600 117,300 224,500 228,500
Income tax provision 33,200 32,000 62,000 61,900
--------- --------- --------- ---------
Net income $81,400 $85,300 $162,500 $166,600
========= ========= ========= =========
Basic earnings per share $0.79 $0.81 $1.57 $1.59
========= ========= ========= =========
Diluted earnings per share $0.76 $0.79 $1.52 $1.54
========= ========= ========= =========
Wt. avg. common shares
outstanding - basic 103,500 105,200 103,700 105,000
Wt. avg. common shares
outstanding - diluted 107,000 108,500 107,000 108,300
Product Group Summary of Net Sales
(in thousands, unaudited)
Quarter Ended June 30,
-----------------------------------
Constant
2006 2005 Change Currency
--------- --------- ------ --------
Vascular $119,700 $108,800 10% 12%
Urology 149,200 131,900 13% 14%
Oncology 117,000 102,000 15% 15%
Surgical Specialties 94,500 85,600 10% 11%
Other 17,800 19,100 -7% -6%
--------- ---------
Reported Sales $498,200 $447,400 11%
FX Impact --- (3,300)
--------- ---------
Con. Currency $498,200 $444,100 12%
========= =========
Product Group Summary of Net Sales
(in thousands, unaudited)
Six Months Ended June 30,
-----------------------------------
Constant
2006 2005 Change Currency
--------- --------- ------ --------
Vascular $233,400 $213,100 10% 12%
Urology 283,500 259,300 9% 10%
Oncology 228,000 195,200 17% 18%
Surgical Specialties 182,600 171,100 7% 7%
Other 38,200 37,300 2% 4%
--------- ---------
Reported Sales $965,700 $876,000 10%
FX Impact --- (9,800)
--------- ---------
Con. Currency $965,700 $866,200 11%
========= =========
Notes to Consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: Statements of Income --For the second quarter ended June June: see month. 30, 2006, in addition to interest income and exchange gains and losses, other (income) expense, net included investment gains of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $1.6 million pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern ($1.0 million after-tax). For the second quarter ended June 30, 2006, research and development expense included a payment of approximately $6.4 million pretax for purchased research and development ($6.4 million after-tax). The results of the second quarter of 2006 also include the incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. impact of the new accounting standard for share-based payments, Statement of Financial Accounting Standards No. 123 (revised 2004), "Share-Based Payment" ("FAS 123R"), as detailed in the table below. In total, these certain items decreased net income by $9.4 million after-tax, or $0.09 diluted earnings per share. --For the six months ended June 30, 2006, in addition to interest income and exchange gains and losses, other (income) expense, net included investment gains of approximately $1.6 million pretax ($1.0 million after-tax). For the six months ended June 30, 2006, research and development expense included payments of approximately $16.8 million pretax for purchased research and development ($12.7 million after-tax). The results of the six months ended June 30, 2006 also include the incremental impact of the new accounting standard for share-based payments under FAS 123R, as detailed in the table below. In total, these certain items decreased net income by $20.2 million after-tax, or $0.19 diluted earnings per share. --For the second quarter ended June 30, 2005, in addition to interest income and exchange gains and losses, other (income) expense, net included the following certain items: an investment gain of approximately $1.2 million pretax ($0.7 million after-tax) and the resolution of a royalty Compensation for the use of property, usually copyrighted works, patented inventions, or natural resources, expressed as a percentage of receipts from using the property or as a payment for each unit produced. matter of approximately $7.1 million pretax ($4.4 million after-tax). In total, these certain items resulted in a net gain of $5.1 million after-tax, or $0.05 diluted earnings per share. --For the six months ended June 30, 2005, in addition to interest income and exchange gains and losses, other (income) expense, net included the following certain items: investment gains and the resolution of a royalty matter for a net adjustment of approximately $11.5 million pretax ($7.1 million after-tax; $0.07 diluted earnings per share).
Reconciliation of Earnings
(in millions except per share amounts, unaudited)
Quarter Ended June 30,
--------------------------------------------------------
2006 2005
------------------------------- ------------------------
FAS
GAAP 123R Certain Adjusted GAAP Certain Adjusted
Basis Adj. Items Basis Basis Items Basis
------- ------ ------- -------- ------- ------- --------
Cost of
goods sold $196.1 ($0.4) --- $195.7 $173.5 --- $173.5
Marketing,
selling &
admin.
expense 153.5 (5.3) --- 148.2 136.0 --- 136.0
Research &
development
expense 37.1 (0.4) (6.4) 30.3 29.0 --- 29.0
Other
(income)
expense,
net (7.6) --- 1.6 (6.0) (11.5) 8.3 (3.2)
Income tax
provision 33.2 2.1 (0.6) 34.7 32.0 (3.2) 28.8
Net income $81.4 $4.0 $5.4 $90.8 $85.3 ($5.1) $80.2
Diluted
earnings
per share $0.76 $0.04 $0.05 $0.85 $0.79 ($0.05) $0.74
Six Months Ended June 30,
--------------------------------------------------------
2006 2005
------------------------------- ------------------------
FAS
GAAP 123R Certain Adjusted GAAP Certain Adjusted
Basis Adj. Items Basis Basis Items Basis
------- ------ ------- -------- ------- ------- --------
Cost of
goods sold $375.5 ($0.6) --- $374.9 $338.4 --- $338.4
Marketing,
selling &
admin.
expense 296.1 (11.7) --- 284.4 264.6 --- 264.6
Research &
development
expense 75.7 (0.8) (16.8) 58.1 56.2 --- 56.2
Other
(income)
expense,
net (15.3) --- 1.6 (13.7) (17.9) 11.5 (6.4)
Income tax
provision 62.0 4.6 3.5 70.1 61.9 (4.4) 57.5
Net income $162.5 $8.5 $11.7 $182.7 $166.6 ($7.1) $159.5
Diluted
earnings
per share $1.52 $0.08 $0.11 $1.71 $1.54 ($0.07) $1.47
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