Biomet Announces Record Fourth Quarter and Fiscal Year End Results, Cash Dividend and Expansion of Its Share Repurchase Program.WARSAW Warsaw (wôr`sô), Pol. Warszawa, city (1993 est. pop. 1,655,700), capital of Poland and of Mazowieckie prov., central Poland, on both banks of the Vistula River. , Ind IND Investigational new drug Therapeutics A status assigned by the FDA to a drug before allowing its use in humans, exempting it from premarketing approval requirements so that experimental clinical trials may be conducted. See Phase 1.2, 3 studies, Sponsorship. . -- Biomet Biomet, Inc. NASDAQ: BMET is a medical device manufacturer located in Warsaw, Indiana. The company specializes in reconstructive products for hips, knees and shoulders, fixation devices, orthopedic support devices, dental implants and operating room supplies. , Inc. (Nasdaq:BMET BMET Biomedical Engineering Technology BMet Bachelor of Metallurgy BMET Bio-Medical Equipment Repair Technician ) today announced that its Board of Directors declared a cash dividend of $0.20 per share, payable July July: see month. 23, 2004 to shareholders of record at the close of business on July 16, 2004. The Board also authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: 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 2.5 million shares of Biomet's outstanding Common Shares to be automatically purchased in equal increments over the next twelve months, irrespective of irrespective of prep. Without consideration of; regardless of. irrespective of preposition despite market conditions. Further, the Board of Directors authorized the purchase of up to an additional $100 million of the Company's outstanding Common Shares in open market or privately negotiated transactions. Purchases of the additional $100 million of Common Shares, if any, will be dependent on market conditions and may be made from time to time between July 2, 2004 and July 1, 2005. In aggregate, the Company has purchased approximately $609,400,000 representing 20,796,000 of its Common Shares in its previous 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. programs since December December: see month. 2001. Dane Dane n. 1. A native or inhabitant of Denmark. 2. A person of Danish ancestry. [Middle English Dan, from Old Norse Danr. A. Miller, Ph.D., President and Chief Executive Officer said, "The declaration of this dividend is an expression of appreciation for the continued support of our shareholders and is further reinforced by the Company's record financial performance during fiscal year 2004 and our optimism for continued strong results as we enter fiscal year 2005. The expansion of our stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program is a reflection of today's poor investment return environment and the Company's continued positive net 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 which amounted to $386,000,000 during fiscal year 2004." Biomet today also reported record sales and earnings results for its fiscal year and fourth quarter ended May 31, 2004. The Company's sales results 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 , on an adjusted basis, exceeded current First Call consensus estimates. During the fourth quarter, 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 increased 19% to $447,188,000, while operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. decreased 3% to $117,189,000 and increased 21%, as adjusted, to $145,889,000. Net income increased 3% to $79,857,000 and 22%, as adjusted, to $95,210,000, while diluted earnings per share increased 3% to $.31 and 23%, as adjusted, to $.37 per share. The Company's reported results reflect its acquisition of the interest of Merck KGaA This article needs sources or references that appear in reliable, third-party publications. Alone, primary sources and sources affiliated with the subject of this article are not sufficient for an accurate encyclopedia article. in the Biomet Merck Merck may refer to:
bad invalid - having no cogency or legal force; "invalid reasoning"; "an invalid driver's license" insurance receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed at its EBI See electron beam imaging. subsidiary. During the course of this review, the Company revised its estimates of future collections of insurance receivables at its EBI subsidiary and increased the balance in the reserves for uncollectible insurance receivables by $25,000,000. The additional reserve, which is based on historical analysis as well as management's best estimates of future collections, takes into account insurance underpayments, denial of payments and difficulties with billing and collecting co-payments from patients. The refinement of our assumptions for calculating this reserve is not anticipated to have a material effect on the Company's future billings or bad debt expense and also would not have had a material effect on the FY2004 reported results had these assumptions been made for prior periods. Adjusted results exclude acquisition costs, including inventory step-up step-up A scheduled increase in the exercise or conversion price at which a warrant, an option, or a convertible security may be used to acquire shares of common stock. and write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of in-process research and development, a gain on disposition of an equity investment, and the aforementioned a·fore·men·tioned adj. Mentioned previously. n. The one or ones mentioned previously. aforementioned Adjective mentioned before Adj. 1. increase in reserves. A reconciliation to comparable GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). measure is included in this press release. Dr. Miller continued, "We are pleased with Biomet's fourth quarter operating results, which continue to be led by strong growth in the Company's reconstructive re·con·struc·tive adj. 1. Relating to or characterized by reconstruction. 2. Serving to rebuild, restore, or correct the appearance and function of defective, damaged, or misshaped body structures or parts: , spinal spinal /spi·nal/ (spi´n'l) 1. pertaining to a spine or to the vertebral column. 2. pertaining to the spinal cord's functioning independently from the brain. spi·nal adj. hardware and orthobiologic product lines. Continued market acceptance of recently introduced products and minimally-invasive knee and hip instruments propelled the growth of the Company's reconstructive product lines during the fourth quarter. Importantly, Biomet's domestic sales of reconstructive products increased 20% during the fourth quarter. Worldwide total hip, knee, extremity extremity /ex·trem·i·ty/ (eks-trem´i-te) 1. the distal or terminal portion of elongated or pointed structures. 2. limb. ex·trem·i·ty n. 1. and dental reconstructive implant implant /im·plant/ (im-plant´) to insert or to graft (tissue, or inert or radioactive material) into intact tissues or a body cavity. sales grew 16%, 24%, 29% and 21%, respectively, during the recently completed quarter. Additionally, sales of the Company's spinal hardware and orthobiologic spinal products increased 32% worldwide during the fourth quarter as Biomet continues to broaden its line of spinal products and technologies for our customers worldwide." Excluding the impact of foreign currency, which increased fourth quarter sales by $17.3 million, net sales increased 14% during the fourth quarter of fiscal year 2004. 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. and international sales, excluding the effects of foreign currency, each increased 14% during the fourth quarter. Reconstructive device sales increased 23% worldwide to $297,139,000 during the fourth quarter of fiscal year 2004. On a constant-currency basis, worldwide reconstructive device sales increased 17%. Knee sales increased 24% worldwide during the fourth quarter and 22% in the United States. Knee sales increased 18% worldwide, constant currency. Knee sales continue to be driven by Biomet's broad line of total knee systems and minimally-invasive unicondylar knee systems. Additionally, the Company's Microplasty(TM) minimally-invasive total knee instruments continue to receive excellent market acceptance. During the fourth quarter, hip sales increased 16% worldwide and 9% in the United States. Excluding the impact of foreign currency, hip sales increased 10% worldwide. Biomet's M2a 38 Metal-on-Metal System and the Company's broad line of porous-coated stems and revision systems continue to lead hip sales growth. Revision hip sales in the United States increased 21% during the recently completed quarter. Extremity sales increased 29% worldwide during the fourth quarter of fiscal year 2004 and 25% in the United States. On a constant-currency basis, extremity sales increased 23% worldwide. Sales of dental reconstructive implants increased 21% worldwide and 19% in the United States during the fourth quarter. Worldwide dental reconstructive implant sales increased 16%, constant currency. Sales of bone cements and accessories increased 40% worldwide during the fourth quarter and 60% in the United States. Excluding the effect of foreign currency, sales of bone cements and accessories increased 28% worldwide. Fixation fixation: see psychoanalysis. sales increased 6% to $63,932,000 during the fourth quarter of fiscal year 2004 and increased 5% worldwide, constant currency. Lorenz Lo·renz , Konrad Zacharias 1903-1989. Austrian psychologist. He shared a 1973 Nobel Prize for studies of individual and social behavior patterns. Noun 1. Surgical's craniomaxillofacial fixation sales increased 16% worldwide and 2% in the United States during the fourth quarter. Worldwide craniomaxillofacial fixation sales increased 14%, constant currency. Sales of electrical stimulation products increased 7% worldwide and 6% in the United States during the fourth quarter. Internal fixation internal fixation n. The stabilization of fractured bony parts by direct fixation to one another with surgical wires, screws, pins, or plates. sales increased 1% worldwide and in the United States during the fourth quarter. On a constant-currency basis, worldwide internal fixation sales were down 4%. External fixation external fixation n. The fixation of a fractured bone by a splint or plastic dressing. external fixation Orthopedics Open reduction, stabilization and use of external fixators to manage fracture bone fragments sales decreased 1% worldwide during the fourth quarter and decreased 5% in the United States. Excluding the impact of foreign currency, external fixation sales decreased 2% worldwide. Spinal product sales increased 15% to $43,660,000 and increased 13% in the United States during the fourth quarter of fiscal year 2004. Spinal sales increased 14% worldwide, constant currency. Domestic sales of spinal implants and orthobiological products for the spine increased 32%, while domestic spinal stimulation sales increased 7% during the fourth quarter. Sales of Biomet's "other products" increased 13% to $42,457,000 and increased 8% in the United States during the fourth quarter of fiscal year 2004. On a constant-currency basis, "other product" sales increased 11% worldwide. Arthroscopy Arthroscopy Definition Arthroscopy is the examination of a joint, specifically, the inside structures. The procedure is performed by inserting a specifically designed illuminated device into the joint through a small incision. sales increased 5% worldwide during the quarter and increased 3% in the United States and constant currency. Softgoods and bracing bracing, n a resistance to the horizontal components of masticatory force. sales increased 6% worldwide and in the United States during the quarter and increased 5%, constant currency. Dr. Miller concluded, "Biomet finished fiscal year 2004 with strong, accelerating momentum in the key reconstructive and spinal product categories. Consequently, we remain comfortable with the range of analysts' sales and earnings estimates of $412.6 million to $444.3 million and $.34 to $.35 per share, excluding acquisition charges, respectively, for the first quarter of fiscal year 2005. Biomet, Inc and its subsidiaries design, manufacture and market products used primarily by musculoskeletal musculoskeletal /mus·cu·lo·skel·e·tal/ (-skel´e-t'l) pertaining to or comprising the skeleton and muscles. mus·cu·lo·skel·e·tal adj. Relating to or involving the muscles and the skeleton. medical specialists in both surgical and non-surgical therapy. The Company's product portfolio encompasses reconstructive products, including orthopedic orthopedic /or·tho·pe·dic/ (-pe´dik) pertaining to the correction of deformities of the musculoskeletal system; pertaining to orthopedics. joint replacement devices, bone cements and accessories, and dental reconstructive implants; fixation products, including electrical bone growth stimulators, internal and external orthopedic fixation devices, craniomaxillofacial implants and bone substitute materials; spinal products, including spinal stimulation devices, spinal hardware and orthobiologics; and other products, such as arthroscopy products and softgoods and bracing products. Headquartered in Warsaw, Indiana Warsaw is a city in, and the county seat of, Kosciusko County, Indiana, United StatesGR6. The population was 12,415, as of the 2000 census. Cradled between Winona Lake, Pike Lake and Center Lake, Warsaw is nicknamed "Lake City , Biomet and its subsidiaries currently distribute products in more than 100 countries. For further information contact Greg GREG Great Egg Harbor National Scenic and Recreational River (US National Park Service) W. Sasso, Vice President, Corporate Development and Communications at (574) 372-1528 or Barbara Barbara maid exemplifying personal and domestic neatness. [Br. Lit.: Old Curiosity Shop] See : Orderliness Goslee, Manager, Corporate Communications Corporate communications is the process of facilitating information and knowledge exchanges with internal and key external groups and individuals that have a direct relationship with an enterprise. at (574) 372-1514. This press release contains certain statements that are "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 Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. . Although the Company believes that the assumptions, on which the forward-looking statements contained herein are based, are reasonable, any of those assumptions could prove to be inaccurate given the inherent uncertainties as to the occurrence or non-occurrence of future events. There can be no assurance that the forward-looking statements contained in this press release will prove to be accurate. Some of the factors that could cause actual results to differ from those contained in forward-looking statements made in this press release include the success of the Company's principal product lines, the Company's ability to develop and market new products and technologies in a timely manner, government regulation, currency exchange rate fluctuations, reimbursements from third party payors, 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. , and other risk factors as set forth from time to time in the Company's filings with the SEC. The inclusion of a forward-looking statement herein should not be regarded as a representation by the Company that the Company's objectives will be achieved. The Company undertakes no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. All of Biomet's financial information may be obtained on our website at www.biomet.com or you may contact us by e-mail at investor.relations@biometmail.com. All trademarks are owned by Biomet, Inc., or one of its subsidiaries.
BIOMET, INC.
QUARTERLY AND ANNUAL RESULTS
FOR THE QUARTERS AND YEARS ENDED May 31
(in thousands, except per share data)
Three Months Ended Twelve Months Ended
--------------------- ----------------------
2004 2003 2004 2003
---- ---- ---- ----
Net Sales $447,188 $377,210 $1,615,253 $1,390,300
Cost of Sales 131,102 110,917 461,502 407,295
---------- --------- ---------- -----------
Gross Profit $316,086 266,293 1,153,751 983,005
S, G, & A 180,461 130,265 595,234 495,391
R & D 18,436 15,047 64,886 55,309
---------- --------- ---------- -----------
Operating Income 117,189 120,981 493,631 432,305
Other Income, Net 4,905 3,491 15,165 19,438
---------- --------- ---------- -----------
Income Before Taxes
And Minority Interest 122,094 124,472 508,796 451,743
Income Taxes 41,439 43,654 176,098 156,961
---------- --------- ---------- -----------
Income Before
Minority Interest 80,655 80,818 332,698 294,782
Minority Interest 798 3,071 7,071 8,081
---------- --------- ---------- -----------
Net Income $79,857 $77,747 $325,627 $286,701
========== ========= ========== ===========
Earnings per Share:
Basic .31 .30 1.27 1.10
Diluted .31 .30 1.27 1.10
Basic Shares 254,308 258,105 255,512 259,493
Diluted Shares 256,185 259,869 257,204 261,394
U.S. sales $291,215 $255,100 $1,079,532 $966,638
Foreign sales 155,973 122,110 535,721 423,662
Reconstructive sales $297,139 $241,410 $1,052,865 $867,602
Fixation sales 63,932 60,248 248,821 237,117
Spinal product sales 43,660 37,987 159,927 143,607
Other product sales 42,457 37,565 153,640 141,974
Consolidated Balance Sheets May 31, May 31,
2004 2003
Assets
Cash and Investments $235,612 $418,594
Accounts and notes
receivable, net 465,949 418,095
Inventories 389,391 356,270
Other current assets 91,256 74,403
Fixed Assets, net 268,826 253,446
Goodwill 266,860 126,706
Other Assets 69,803 24,655
----------- -----------
Total Assets $1,787,697 $1,672,169
=========== ===========
Liabilities and
Stockholders' Equity
Current Liabilities $313,402 $266,654
Other Liabilities 26,085 7,493
Minority Interest -- 111,888
Stockholders' Equity $1,448,210 1,286,134
----------- -----------
Total Liabilities and
Stockholders' Equity $1,787,697 1,672,169
=========== ===========
BIOMET, INC.
RECONCILIATION OF REPORTED AND ADJUSTED STATEMENTS OF EARNINGS(1)
FOR THREE MONTHS ENDED MAY 31
(in thousands, except per share data)
Reported Adjusted
2004 Adjustments 2004 2003
-------- ----------- -------- --------
Net Sales $447,188 $ -- $447,188 $377,210
Cost of Sales 131,102 (2,450)(a) 128,652 110,917
---------- ------------ ----------- ----------
Gross Profit 316,086 2,450 318,536 266,293
S, G, & A 180,461 (25,000)(b) 155,461 130,265
R & D 18,436 (1,250)(c) 17,186 15,047
---------- ------------ ----------- ----------
Operating Income 117,189 28,700 145,889 120,981
Other Income, Net 4,905 (3,362)(d) 1,543 3,491
---------- ------------ ----------- ----------
Income Before Taxes
And Minority
Interest 122,094 25,338 147,432 124,472
Income Taxes 41,439 9,985(e) 51,424 43,654
---------- ------------ ----------- ----------
Income Before
Minority Interest 80,655 15,353 96,008 80,818
Minority Interest 798 -- 798 3,071
---------- ------------ ----------- ----------
Net Income $79,857 $15,353 $95,210 $77,747
========== ============ =========== ==========
Earnings per Share:
Basic .31 .06 .37 .30
Diluted .31 .06 .37 .30
Basic Shares 254,308 254,308 258,105
Diluted Shares 256,197 256,197 259,869
(a) Current period impact of inventory step-up related to the
acquisition of the interest of Merck KGaA in the Biomet Merck
joint venture
(b) EBI additional bad debt allowance
(c) In-process research and development written off as of closing date
of acquisition of same
(d) Non-taxable gain on disposition of an equity investment
(e) Tax effect of items a, b, & c above
(1) We have included these adjusted measures to provide management and
investors with a better understanding of our results, because (i)
the expenses related to the acquisition of Merck KGaA's interest
in the Biomet Merck joint venture in the current quarter and in
fiscal year 2005 are not indicative of our future operating
results, (ii) the gain on the disposition of our equity interest
is a one-time event in the current quarter, and (iii) the
refinement of our assumptions for calculating the reserve for
uncollectible insurance receivables is not anticipated to have a
material effect on the Company's future billings or bad debt
expense and also would not have had a material effect on the
fiscal year 2004 reported results had these assumptions been made
for prior periods.
BIOMET, INC.
RECONCILIATION OF REPORTED AND ADJUSTED STATEMENTS OF EARNINGS
FOR THE TWELVE MONTHS ENDED MAY 31
(in thousands, except per share data)
Reported Adjusted
2004 Adjustments 2004 2003
----------- ------------ ----------- -----------
Net Sales $1,615,253 $ -- $1,615,253 $1,390,300
Cost of Sales 461,502 (2,450)(a) 459,052 407,295
----------- ------------ ----------- -----------
Gross Profit 1,153,751 2,450 1,156,201 983,005
S, G, & A 595,234 (25,000)(b) 570,234 495,391
R & D 64,886 (1,250)(c) 63,636 55,309
----------- ------------ ----------- -----------
Operating Income 493,631 28,700 522,331 432,305
Other Income, Net 15,165 (3,362)(d) 11,803 19,438
----------- ------------ ----------- -----------
Income Before Taxes
And Minority
Interest 508,796 25,338 534,134 451,743
Income Taxes 176,098 9,985(e) 186,083 156,961
----------- ------------ ----------- -----------
Income Before
Minority Interest 332,698 15,353 348,051 294,782
Minority Interest 7,071 -- 7,071 8,081
----------- ------------ ----------- -----------
Net Income $325,627 $15,353 $340,980 $286,701
=========== ============ =========== ===========
Earnings per Share:
Basic 1.27 .06 1.33 1.10
Diluted 1.27 .06 1.33 1.10
Basic Shares 255,512 255,512 259,493
Diluted Shares 257,195 257,195 261,394
(a) Current period impact of inventory step-up related to the
acquisition of the interest of Merck KGaA in the Biomet Merck
joint venture
(b) EBI additional bad debt allowance
(c) In-process research and development written off as of closing date
of acquisition of same
(d) Non-taxable gain on disposition of an equity investment
(e) Tax effect of items a, b & c above
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