Bausch & Lomb Earns 81 Cents Per Share on Seven-Percent Sales Gain.ROCHESTER, N.Y. -- Bausch & Lomb (NYSE NYSE See: New York Stock Exchange :BOL BOL Bolivia (ISO Country code) BOL Books Online BOL Bole (SIL code, Nigeria) BOL Bill Of Lading BOL Beginning Of Line BOL Best Of Luck BOL Buzz Out Loud BOL Bruin Online BOL Beginning Of Life ): --Company increases full-year guidance by five cents --Board of Directors approves additional share repurchase Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. --Company finalizes plans to repatriate repatriate To bring home assets that are currently held in a foreign country. Domestic corporations are frequently taxed on the profits that they repatriate, a factor inducing the firms to leave overseas the profits earned there. offshore funds Bausch & Lomb (NYSE:BOL) today reported results for its second quarter ended June 25, 2005. Worldwide net sales Net Sales 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 of $608.3 million increased seven percent from $566.5 million in the 2004 period, and were up five percent on a constant-currency basis. Gains were reported in each of the Company's geographic segments and product categories. Earnings per share of $0.81 increased seven percent from 2004. For the first six months of 2005, net sales were $1.16 billion, and increased eight percent, or five percent on a constant-currency basis, versus 2004. First-half earnings per share of $1.44 increased 21 percent from a year ago. Second-quarter gross margins were 59.5 percent of sales, compared to 59.8 percent in 2004. Selling, general and administrative expenses increased seven percent from the prior-year period, mainly reflecting selling and marketing expenses associated with the launch and promotion of new products, and declined to 38.9 percent of sales as compared to 39.2 percent in 2004. Research and development expenditures rose nine percent in the second quarter, consistent with the Company's intention to invest in R&D at a faster rate than sales growth. Net financing expense of $11.5 million decreased $0.1 million from the 2004 second quarter. Higher interest and foreign exchange income was essentially offset by increased interest expense that included a $3.3 million charge to write off unamortized issue costs associated with the Company's convertible securities. As previously announced, the securities became convertible on July 1, 2005, subsequent to the Company's stock trading above $73.73 for the 20th trading day In Business, the trading day is the time span that a particular stock exchange is open. For example, the New York Stock Exchange is, as of 2006, open from 09:30AM to 4:00PM. Trading days never take place on weekends. in the 30 consecutive trading days ending on June 30, 2005. "We were very satisfied with our second-quarter performance," said Bausch & Lomb Chairman and Chief Executive Officer Ronald L. Zarrella, "and from an earnings perspective, first-half results were a bit ahead of our expectations. Given our performance to date, and recognizing that new products and further share gains are expected to accelerate top-line growth in the second half of 2005, we have upwardly revised our outlook for the full year." Excluding the sales impact of the previously announced acquisition of Shandong Chia Tai Freda Pharmaceutical Group (CTF CTF Capture The Flag CTF Child Trust Fund (UK) CTF Canadian Tax Foundation CTF Canadian Taxpayers Federation (lobby group) CTF Canadian Television Fund CTF Canadian Teachers' Federation ), Bausch & Lomb is now projecting full-year constant-currency sales growth of approximately seven percent, at the upper end of previous guidance, which called for growth between six and seven percent. Based on the current foreign exchange environment, currency is expected to be essentially neutral to actual-dollar full-year sales growth. Full-year earnings per share are projected at $3.50, up from previous expectations of $3.45, with the increase expected to be realized in the fourth quarter. The Company indicated that ongoing product launch related expenses and increased R&D spending will moderate earnings in the third quarter. The preceding projections exclude customary purchase accounting adjustments, such as inventory step-up and in-process R&D charges, to be recorded upon the closing of the acquisition of CTF which is expected to occur in the third quarter. They also do not reflect one-time higher income tax expense to be recorded as a result of repatriating offshore funds under the American Jobs Creation Act of 2004, discussed later in this news release. Finally, guidance excludes an approximately $0.04 per share reduction in earnings associated with the divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). of the Company's Woehlk subsidiary. Acquired in 2000, Woehlk manufactures and distributes vision care products primarily in Germany. The business did not meet the Company's strategic and financial objectives, and was spun off in a management buy-out buy·out also buy-out n. 1. The purchase of the entire holdings or interests of an owner or investor. 2. The purchase of a company or business: in July. Revenue Highlights Second-quarter revenues by geographic segment and product category are summarized in the following tables: Constant Unaudited Actual Currency ---------------------------------------------------------------------- Americas + 3% + 2% Europe, Middle East and Africa + 11% + 7% Asia + 9% + 6% Constant Unaudited Actual Currency ---------------------------------------------------------------------- Contact Lenses + 13% + 10% Lens Care + 3% + 1% Pharmaceuticals + 6% + 3% Cataract and Vitreoretinal + 6% + 4% Refractive + 7% + 5% Revenues derived in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. increased to $226.5 million in the second quarter, up less than one percent from the prior-year period, and represented 37 percent of total Company sales. Revenues derived in non-U.S. markets increased 12 percent over the same period in 2004 and were up eight percent on a constant-currency basis. Bausch & Lomb's contact lens contact lens, thin plastic lens worn between the eye and eyelid that may be used instead of eyeglasses. Actors, models, and others wear them for appearance, and athletes use them for safety and convenience. sales growth continued to outpace out·pace tr.v. out·paced, out·pac·ing, out·pac·es To surpass or outdo (another), as in speed, growth, or performance. outpace Verb [-pacing, the overall market in the second quarter. The PureVision(TM) brand of silicone silicone, polymer in which atoms of silicon and oxygen alternate in a chain; various organic radicals, such as the methyl group, CH3, are bound to the silicon atoms. hydrogel hy·dro·gel n. A colloidal gel in which the particles are dispersed in water. hydrogel a gel that contains water. hydrogel Wound care A polymer absorptive wound dressing. See Dressing. contact lenses contact lenses contact npl → verres mpl de contact contact lenses contact npl → Kontaktlinsen pl contact lenses npl led that growth, with expanded distribution of PureVision SVS SVS - OS/VS2 and PureVision Toric tor·ic adj. Of, relating to, or shaped like a torus or part of a torus. in Europe and Asia augmented by the return of the SVS product to the U.S. market. The SofLens(R) Toric, SofLens Multi-Focal, SofLens59 and SofLens One Day brands were also major contributors to second-quarter gains, with each experiencing strong double-digit growth. Lens care sales growth was led by the Company's lines of all-in-one solutions for both soft and rigid gas permeable gas permeable gas adj (lenses) → luftdurchlässig contact lenses. Gains in Europe and Asia were partially offset by a one-percent decline in the Americas region that reflected the previously disclosed timing of a major U.S. customer's promotion that shifted sales from the second quarter into the first. First-half lens care sales in the Americas were up seven percent (six percent in constant currency), and reflected continued market acceptance and share gains for ReNu(R) with MoistureLoc(TM) multi-purpose solution. Constant-currency pharmaceuticals sales growth was mainly attributable to the Company's lines of ocular ocular /oc·u·lar/ (ok´u-lar) 1. of, pertaining to, or affecting the eye. 2. eyepiece. oc·u·lar adj. 1. Of or relating to the eye or the sense of sight. vitamins and dry eye medications, as well as double-digit increases for both Lotemax(R) and Alrex(R) prescription steroid drops. Those gains were partly offset by lower sales of certain non-ophthalmic multisource pharmaceuticals, reflecting recent competitive introductions. Cataract cataract, in medicine, opacity of the lens of the eye, which impairs vision. In the young, cataracts are generally congenital or hereditary; later they are usually the result of degenerative changes brought on by aging or systemic disease (diabetes). and vitreoretinal growth was led by the Company's lines of intraocular lenses Intraocular lens Lens made of silicone or plastic placed within the eye; can be corrective. Mentioned in: Cataract Surgery (IOLs) and phacoemulsification phacoemulsification /phaco·emul·si·fi·ca·tion/ (-e-mul?si-fi-ka´shun) a method of cataract extraction in which the lens is fragmented by ultrasonic vibrations and simultaneously irrigated and aspirated. products. Constant-currency IOL IOL Intraocular lens, see there sales growth was nine percent, reflecting continued strong double-digit gains for Bausch & Lomb's SofPort(TM) and Akreos(TM) lines of foldable IOLs. Refractive refractive capacity to refract light. refractive error a difference between the focal length of the cornea and lens, and the length of the eye, resulting in myopia or hyperopia. category growth was due to a 16-percent gain in sales of per procedure cards used in LASIK LASIK laser-assisted in-situ keratomileusis. LA·SIK n. Eye surgery in which the surface of the cornea is reshaped using a laser, performed to correct certain refractive disorders such as myopia. surgery and increased service revenue, somewhat offset by lower equipment sales. Liquidity Highlights and Trends As of June 25, 2005, cash and investments totaled $518.3 million, an increase of $16.5 million since the end of 2004. Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses totaled $88.0 million for the first six months of 2005, compared to $97.5 million a year ago, reflecting higher earnings and lower tax payments, more than offset by higher inventories associated with new products and increased working capital requirements Capital requirements Financing required for the operation of a business, composed of long-term and working capital plus fixed assets. . Bausch & Lomb indicated that it continues to project cash flow from operations of approximately $270 million for all of 2005, with capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. totaling approximately $120 million. Stock Repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. Authorization Increased Bausch & Lomb further announced that its board of directors has approved the repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. of up to an additional two million shares of Bausch & Lomb stock. Consistent with its previous authorization, the Company expects to repurchase shares using proceeds from stock option exercises, to partially offset the otherwise dilutive impact of exercise activity. American Jobs Creation Act of 2004 Bausch & Lomb also announced today that, under the provisions of the American Jobs Creation Act of 2004, it intends to repatriate approximately $805 million in foreign earnings previously considered permanently reinvested in non-U.S. legal entities. The funds, which are in addition to the Company's ongoing repatriation Repatriation The process of converting a foreign currency into the currency of one's own country. Notes: If you are American, converting British Pounds back to U.S. dollars is an example of repatriation. initiatives, will be brought back into the United States in the fourth quarter. Bausch & Lomb expects to record one-time tax expense of approximately $34 million (or about $0.61 per share) in the third quarter to recognize the income tax liability associated with repatriating these funds. In connection with the repatriation of funds, Bausch & Lomb anticipates borrowing between $425 million and $450 million outside the United States in the third and fourth quarters. Debt service on these borrowings will be accomplished through future foreign earnings. Bausch & Lomb Chief Financial Officer Stephen C. McCluski indicated, "We are taking several actions over the remainder of the year to optimize our cash positions for future growth. After executing new offshore borrowings, repaying the debt that matures in August, and funding the acquisition of CT Freda, we expect to end the year with about $650 million in cash, between $970 million and $995 million in debt, and a debt-to-capital ratio just under 40 percent, all within the thresholds appropriate to our current investment grade credit rating." Notes All per share amounts in this release are calculated on the 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. basis, as defined by Statement of Financial Accounting Standards (SFAS SFAS Statement of Financial Accounting Standards SFAS Special Forces Assessment and Selection SFAS Student Financial Aid Services SFAS Sport Fishing Association of Singapore SFAS Safety Features Actuation System SFAS Statewide Fixed Assets System ) No. 128.
Investor Conference Call Information
10:00 a.m. (ET)
The News Media is invited to listen only on this call.
Call-in Number: 913.981.5507
Rebroadcast Number: 719.457.0820
Confirmation #924579
The rebroadcast of the conference call will be available starting at
2:00 p.m. ET July 27, 2005 through midnight July 31, 2005.
Additionally, the investor call will be broadcast live over the
Internet. It can be accessed from the Investor Relations page of the
Company's Web site, www.bausch.com, or at www.vcall.com.
This news release contains, among other things, certain statements of a forward-looking nature relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc future events or the future business performance of Bausch & Lomb. Such statements involve a number of risks and uncertainties including, without limitation, those concerning global and local economic, political and sociological conditions; currency exchange rates; government pricing changes and initiatives with respect to healthcare products; changes in laws and regulations relating to the Company's products and the import and export of such products; product development and rationalization rationalization, in psychology: see defense mechanism. ; enrollment and completion of clinical trials; the ability of the Company to obtain regulatory approvals; the outcome of 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. ; the success of product introductions; the financial well-being of key customers, development partners and suppliers; the successful execution of marketing strategies; continued efforts in managing and reducing costs and expenses; the successful repatriation of funds under the American Jobs Creation Act of 2004; the successful completion and integration of acquisitions announced by the Company; the Company's success in introducing and implementing its enterprise-wide information technology initiatives, including the corresponding impact on internal controls and reporting; the Company's success in the process of management testing, including the evaluation of results; continued positive relations with third party financing sources and the risk factors listed from time to time in the Company's SEC filings, including but not limited to the Current Report on Form 8-K Form 8-K The form required by the SEC when a publicly held company incurs any event that might affect its financial situation or the share value of its stock. Form 8-K See 8-K. , dated June 14, 2002 and the Form 10-Q Form 10-Q See 10-Q. for the quarter ended March 25, 2005. Bausch & Lomb is the eye health company, dedicated to perfecting vision and enhancing life for consumers around the world. Its core businesses include soft and rigid gas permeable contact lenses and lens care products, and ophthalmic ophthalmic /oph·thal·mic/ (of-thal´mik) ocular (1). oph·thal·mic adj. Of or relating to the eye; ocular. Ophthalmic Pertaining to the eye. surgical and pharmaceutical products. The Bausch & Lomb name is one of the best known and most respected healthcare brands in the world. Founded in 1853, the Company is headquartered in Rochester, New York This article is about the city of Rochester in Monroe County. For the town in Ulster County, see Rochester, Ulster County, New York. Rochester, once known as The Flour City, and more recently as The Flower City or . Bausch & Lomb's 2004 revenues were $2.2 billion; it employs approximately 12,400 people worldwide and its products are available in more than 100 countries. More information about the Company can be found on the Bausch & Lomb Web site at www.bausch.com. Copyright Bausch & Lomb.
Bausch & Lomb Incorporated and Consolidated Subsidiaries
STATEMENTS OF INCOME
Unaudited Unaudited
Second Quarter Ended Six Months Ended
-------------------- ----------------
Dollar Amounts in Millions- June 25, June 26, June 25, June 26,
Except Per Share Data 2005 2004 2005 2004
--------------------------- ------- ------- ------- -------
Net Sales
Americas $ 255.6 $ 247.5 $ 490.7 $ 462.5
Europe 224.9 202.0 441.0 403.1
Asia-Pacific 127.8 117.0 230.9 211.2
------- ------- -------- --------
608.3 566.5 1,162.6 1,076.8
Costs and Expenses
Cost of products sold 246.1 227.6 478.1 448.0
Selling, administrative and
general 236.7 222.0 459.2 433.9
Research and development 45.3 41.7 84.6 76.3
------- ------- -------- --------
528.1 491.3 1,021.9 958.2
------- ------- -------- --------
Operating Income 80.2 75.2 140.7 118.6
Other (Income) Expense
Interest and investment
income (2.7) (2.1) (6.5) (6.2)
Interest expense 14.5 11.8 25.4 23.6
Foreign currency, net (0.3) 1.9 (0.3) 0.6
------- ------- -------- --------
11.5 11.6 18.6 18.0
------- ------- -------- --------
Income Before Income Taxes and
Minority Interest 68.7 63.6 122.1 100.6
Provision for income taxes 22.7 21.3 40.3 33.7
Minority interest in
subsidiaries 1.0 0.9 2.2 2.0
------- ------- -------- --------
Net Income $ 45.0 $ 41.4 $ 79.6 $ 64.9
======= ======= ======== ========
Diluted Earnings Per Share $ 0.81 $ 0.76 $ 1.44 $ 1.19
======= ======= ======== ========
Average Shares Outstanding -
Diluted (000s) 55,714 54,569 55,491 54,530
======= ======= ======== ========
SUPPLEMENTAL REVENUE INFORMATION
Net Sales
Contact Lens $ 188.3 $ 167.1 $ 359.4 $ 324.2
Lens Care 139.2 134.9 268.5 249.1
Pharmaceuticals 147.4 139.4 277.6 255.0
Cataract and Vitreoretinal 95.3 89.5 184.8 174.0
Refractive 38.1 35.6 72.3 74.5
------- ------- -------- --------
$ 608.3 $ 566.5 $1,162.6 $1,076.8
======= ======= ======== ========
Bausch & Lomb Incorporated and Consolidated Subsidiaries
BALANCE SHEETS
Unaudited
June 25, December 25,
Dollar Amounts in Millions 2005 2004
-------------------------- -------- -----------
Assets
Cash and Cash Equivalents $ 518.3 $ 501.8
Trade Receivables, Net 513.0 511.4
Inventories, Net 217.8 204.4
Other Current Assets 175.6 162.9
--------- ---------
Total Current Assets 1,424.7 1,380.5
Properties, Net 559.5 580.9
Goodwill and Intangible Assets 899.6 940.6
Other Assets 111.6 120.1
--------- ---------
Total Assets $ 2,995.4 $ 3,022.1
========= =========
Liabilities and Shareholders' Equity
Current Portion of long-term debt $ 101.0 $ 100.8
Other Current Liabilities 722.3 731.7
--------- ---------
Total Current Liabilities 823.3 832.5
Long-Term Debt 542.6 543.3
Other Long-Term Liabilities 188.1 203.9
Minority Interest 15.7 15.5
--------- ---------
Total Liabilities 1,569.7 1,595.2
Total Shareholders' Equity 1,425.7 1,426.9
--------- ---------
Total Liabilities and Shareholders'
Equity $ 2,995.4 $ 3,022.1
========= =========
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