Bausch & Lomb First-Quarter Revenues Rise 8%, Generating $0.31 EPS from Continuing Operations.Business Editors ROCHESTER Rochester (rŏch`ĕstər, –ĭstər). 1 City (1990 pop. 70,745), seat of Olmsted co., SE Minn.; inc. 1858. , N.Y.--(BUSINESS WIRE)--April 24, 2003 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 ): -- Comparable-basis earnings per share from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the improve 29% over 2002 -- Profitability improvement plan on target; comparable-basis operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before up 43% Bausch & Lomb (NYSE:BOL) today reported first-quarter worldwide sales of $448.0 million, an increase of $33.8 million or 8 percent over the prior-year first quarter. A 7-percent benefit from the strengthening of foreign currencies against the U.S. dollar augmented underlying fundamental growth in the Company's lines of contact lenses contact lenses contact npl → verres mpl de contact contact lenses contact npl → Kontaktlinsen pl contact lenses npl , pharmaceuticals and cataract surgery Cataract Surgery Definition Cataract surgery is a procedure performed to remove a cloudy lens from the eye; usually an intraocular lens is implanted at the same time. Purpose The purpose of cataract surgery is to restore clear vision. products. Reported net earnings from continuing operations were $16.5 million, or $0.31 per share, an increase of 29 percent over the comparable-basis prior-year amount of $0.24 per share. Total 2003 first-quarter reported earnings of $15.6 million, or $0.29 per share, reflected a $0.02 per share cumulative impact from adopting Statement of Financial Standards No. 143, Accounting for Asset Retirement Obligations Asset Retirement Obligations provide for future disposal of assets as required by SFAS 143 [1]. Firms must recognize the ARO liability in the period it was acquired, generally acquisition. , as of the beginning of the year. First-quarter 2002 reported earnings of $8.8 million or $0.16 per share included certain non-recurring items, discussed below, which totaled $0.08 per share. Commenting on today's announcement, Bausch & Lomb Chief Executive Officer Ronald L. Zarrella said, "We are pleased with the results we posted today. From an operational perspective, they were in line with our internal goals, and represented the fifth consecutive quarter we've we've Contraction of we have. we've have met or exceeded performance expectations. Importantly, our profitability improvement program continues to progress, and was a major factor behind the 43-percent improvement in comparable-basis operating earnings in the quarter." Reconciliation Between Reported and Comparable-Basis Earnings The following table provides a reconciliation between reported and "comparable-basis" first-quarter net earnings and earnings per share from continuing operations.
Dollars in Millions, Except Per Share Data First First
Quarter 2003 Quarter 2002
------------------------------------------------------ -----------
$ Per $ Per
Share Share
----------- -----------
Reported net earnings $15.6 $0.29 $ 8.8 $0.16
Change in accounting principle, net of
taxes 0.9 0.02 - -
----------- -----------
Reported earnings from continuing
operations $16.5 $0.31 $ 8.8 $0.16
Restructuring charges and asset write-offs - - 15.4 0.28
Gain on sale of stock investment - - (18.1)(0.33)
Minority interest charge - - 7.0 0.13
----------- -----------
Comparable-basis earnings from continuing
operations $16.5 $0.31 $13.1 $0.24
----------- -----------
In the prior-year quarter, the Company recorded restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. and asset write-offs totaling $23.5 million before taxes, or $15.4 million after taxes, associated with a program designed to reduce ongoing operating costs operating costs npl → gastos mpl operacionales . Additionally, it recognized gains Recognized Gain The amount of gain reported for income tax purposes. Notes: You can defer recognizing some gains until the following year(s). See also: Capital Gain, Capital Loss, Deferred Income Tax, Drought Sale, Exempt Income, Exemption, Gain, Recognized Loss from the sale of an equity interest in a previously divested entity amounting to $27.6 million before taxes, or $18.1 million after taxes. Lastly, the Company recorded a charge to minority interest expense of $7.0 million after taxes, representing an early liquidation The collection of assets belonging to a debtor to be applied to the discharge of his or her outstanding debts. A type of proceeding pursuant to federal Bankruptcy premium associated with the termination of a minority interest liability. Revenues by Geography First-quarter U.S. revenues were $181.3 million, flat with the prior year, and constituted 40 percent of total Company sales. Revenues derived in markets outside the U.S. increased 14 percent over the first quarter of 2002. Translating both current and prior-year local currency revenues at constant exchange rates, revenues outside the U.S. increased 1 percent. Actual and constant-currency revenue increases for each of the Company's geographic operating segments were as follows:
Constant
Actual Currency
----------------------------------------------------------------------
Americas + 0% + 1%
Europe, Middle East and Africa + 17% - 1%
Asia + 12% + 6%
These operating segment revenue trends are largely the result of the factors discussed below which influence each of the Company's product categories. Revenues by Product Category 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. revenues increased 11 percent from the first quarter of 2002, and were up 3 percent on a constant-currency basis. Performance was driven by the Company's current generation core lens products, which registered strong double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. gains in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and Asia, and
high-single-digit gains in the Americas A·mer·i·cas , theSee America. region. Lens care revenues increased 1 percent over the prior year, but declined 3 percent on a constant-currency basis. Share gains for the ReNu ReNu® is a brand of soft contact lens care products produced by Bausch & Lomb[1]. The brand recently made headlines regarding a report from the United States Centers for Disease Control and Prevention suggesting an increased incidence of fungal keratitis in people using (R) brand of chemical disinfectants in the U.S. and Asia generated higher sales and, together with a favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. benefit from currency, more than offset the impact of the Company's decision in the second half of 2002 to exit certain non-strategic lens care product lines in Europe. Pharmaceutical revenues increased 16 percent over the prior year and were up 6 percent on a constant-currency basis, driven mainly by continued strong gains in sales 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 multisource products in the Americas region. Revenues from products used in 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 vitreoretinal /vit·reo·ret·i·nal/ (vit?re-o-ret´i-n'l) of or pertaining to the vitreous and retina. vit·re·o·ret·i·nal adj. surgery increased 9 percent over the prior year and 2 percent on a constant-currency basis, with higher sales in Europe and Asia and declines in the Americas. Refractive surgery Refractive surgery A surgical procedure that corrects visual defects. Mentioned in: Photorefractive Keratectomy and Laser-Assisted In-Situ Keratomileusis refractive surgery product revenues declined 3 percent from the prior year and were down 8 percent on a constant-currency basis. Lower capital equipment sales were partially offset by increased service revenues as well as higher sales outside the U.S. of Zyoptix(TM) per-procedure cards for customized 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. Liquidity Highlights Total cash and investments at the end of the first quarter totaled $431.2 million, representing a total cash outflow of $33.9 million in the first quarter. The Company generated free cash flow of $15.0 million in the first three months of 2003, compared to $43.2 million in the year-ago period. Positive free cash flow was used to 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. 750,000 shares of Company stock for $30.7 million upon maturity of outstanding forward equity contracts, as well as to pay dividends. A reconciliation between cash flow and free cash flow follows:
First First
Quarter Quarter
2003 2002
----------------------------------------------------------------------
Net change in cash and cash equivalents $(33.9) $(32.8)
Net cash used in financing activities 42.7 52.0
Sales price adjustment related to disposal of
discontinued operations - 23.0
Net cash paid for acquisitions of businesses and other
intangible assets 6.2 1.0
---------------
Free Cash Flow $ 15.0 $ 43.2
---------------
"We are pleased with the progress we are making in strengthening our balance sheet and overall liquidity position," said Bausch & Lomb Chief Financial Officer Stephen Stephen, 1097?–1154, king of England (1135–54). The son of Stephen, count of Blois and Chartres, and Adela, daughter of William I of England, he was brought up by his uncle, Henry I of England, who presented him with estates in England and France and C. McCluski. "We continue to focus our attention on accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying and inventory management, and we made progress on both fronts this quarter, with both days sales outstanding In accountancy, Days Sales Outstanding is a company's average collection period. A low figure indicates that the company collects its outstanding receivables quickly. Typically it is looked at either quarterly or yearly (90 or 365 days). and inventory months-on-hand improved as compared to the first quarter of 2002 and ahead of our internal expectations." Guidance for Remainder of 2003 Unchanged Both the euro and the Japanese yen “Yen” redirects here. For the other use, see Yen (disambiguation). “JPY” redirects here. For the Australian singer with the same moniker, see John Paul Young. strengthened relative to the U.S. dollar during the first quarter from the levels anticipated by the Company in developing full-year guidance for 2003, generating approximately $0.02 in additional earnings per share. The Company indicated that, if currency rates remain at current levels, full-year sales and earnings per share would continue to benefit positively as compared to previous guidance, resulting in full-year total sales growth in the upper-single digits as compared to 2002 and earnings per share increasing by an additional $0.02 to $0.04 in total over the remaining three quarters of 2003. However, the expanding epidemic epidemic, outbreak of disease that affects a much greater number of people than is usual for the locality or that spreads to regions where it is ordinarily not present. of the SARS virus, particularly in Asia, the Company's fastest-growing segment, could potentially offset positive currency benefits. Because it is still too early to predict the impact of SARS with any degree of certainty, the Company is not changing earnings guidance for the remaining three quarters of 2003 at this time. Full-year revenue guidance in total and by product category also remain unchanged from the expectations included in the Company's 2002 Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. . Note: 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 #544999
The rebroadcast of the conference call will be available starting at
1:30 p.m. ET April 24, 2003 through midnight April 28, 2003.
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 for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. 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 those concerning global and local economic, political and sociological conditions, currency exchange rates, government pricing changes and initiatives with respect to healthcare products, product development and rationalization rationalization, in psychology: see defense mechanism. , enrollment and completion of clinical trials, 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. , product introductions, the financial well-being of key customers, development partners and suppliers, the successful execution of marketing strategies, the continued successful implementation of its efforts in managing and reducing costs and expenses, continued positive relations with third party financing sources, as well as 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-K for the year ended December 28, 2002. 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 gas permeable gas adj (lenses) → luftdurchlässig 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. Celebrating its 150th anniversary in 2003, 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 2002 revenues were $1.8 billion; it employs approximately 11,500 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. Trademarks of Bausch & Lomb Incorporated and its affiliates are italicized.
Bausch & Lomb
STATEMENT OF EARNINGS
Three Months Ended
---------------------
Dollar Amounts in Millions- March 29, March 30,
Except Per Share Data 2003 2002
--------------------------- ---------- ----------
Net Sales
Americas $ 199.5 $ 199.2
Europe 169.8 144.9
Asia-Pacific 78.7 70.1
--------- ---------
448.0 414.2
Costs and Expenses
Cost of products sold 198.2 181.4
Selling, administrative and general 180.2 174.9
Research and development 29.8 30.1
Restructuring charges (1) - 23.5
--------- ---------
408.2 409.9
--------- ---------
Operating Earnings 39.8 4.3
Other (Income) Expense
Interest and investment income (2) (1.7) (37.2)
Interest expense 14.5 12.7
Loss from foreign currency 1.7 0.2
--------- ---------
14.5 (24.3)
--------- ---------
Earnings Before Income Taxes and Minority
Interest 25.3 28.6
Provision for income taxes 8.6 9.8
--------- ---------
Earnings Before Minority Interest 16.7 18.8
Minority interest in subsidiaries (3) 0.2 10.0
--------- ---------
Earnings from Continuing Operations 16.5 8.8
Cumulative Effect of Change in Accounting
Principle, net of taxes (4) (0.9) -
--------- ---------
Net Earnings $ 15.6 $ 8.8
========= =========
Per Share:
Earnings from Continuing Operations $ 0.31 $ 0.16
Cumulative Effect of Change in Accounting
Principle, net of taxes (4) (0.02) -
--------- ---------
Net Earnings $ 0.29 $ 0.16
========= =========
Average Shares Outstanding - (000s) 53,830 53,979
========= =========
(1) Restructuring charges reduced first-quarter 2002 net earnings by
$15.4 or $0.28 per diluted share.
(2) Includes $27.6 income in the first quarter of 2002 ($18.1 after
taxes or $0.33 per diluted share) for the sale of Charles River
stock.
(3) First-quarter 2002 reflects a one-time minority interest payment
reducing net earnings $7.0 or $0.13 per diluted share.
(4) Income taxes related to the adoption of SFAS No. 143 were $0.5.
SUPPLEMENTAL REVENUE INFORMATION
Net Sales
Contact Lens $ 133.4 $ 119.9
Lens Care 106.5 105.5
Pharmaceuticals 99.0 85.5
Cataract and Vitreoretinal 79.1 72.4
Refractive 30.0 30.9
--------- ---------
$ 448.0 $ 414.2
========= =========
Bausch & Lomb
BALANCE SHEET
March 29, December 28,
Dollar Amounts in Millions 2003 2002
-------------------------- ----------- --------------
Assets
Cash and Short-term Investments $ 431.2 $ 465.1
Trade Receivables, Net 383.6 425.0
Inventories, Net 215.2 208.5
Other Current Assets 200.3 186.1
---------- -------------
Current Assets 1,230.3 1,284.7
Properties, Net 529.9 537.5
Goodwill and Intangible Assets 872.4 862.8
Other Assets 226.1 222.8
---------- -------------
Total Assets $ 2,858.7 $ 2,907.8
---------- -------------
Liabilities and Shareholders' Equity
Short-Term Debt $ 187.4 $ 187.9
Other Current Liabilities 617.0 641.1
---------- -------------
Current Liabilities 804.4 829.0
Long-Term Debt 650.0 656.2
Other Long-Term Liabilities 385.3 385.7
Minority Interest 16.2 19.1
---------- -------------
Total Liabilities 1,855.9 1,890.0
Shareholders' Equity 1,002.8 1,017.8
---------- -------------
Total Liabilities and Shareholders'
Equity $ 2,858.7 $ 2,907.8
---------- -------------
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