Biomet Announces Record Second Quarter Results and Expansion of Share Repurchase Program.

Business Editors & Health/Medical Writers

WARSAW, Ind.--(BUSINESS WIRE)--Dec. 18, 2002

Biomet, Inc. (Nasdaq:BMET) today reported record sales and earnings results for its second quarter ended November 30, 2002. Net sales increased 18% to $341,448,000. Operating income increased 18% to $108,525,000, while net income increased 15% to $70,354,000 and diluted earnings per share increased 17% to $.27.

Biomet, Inc. also announced today that the Board of Directors of the Company has authorized the purchase of up to an additional $24 million of the outstanding Common Shares of the Company in open market or privately negotiated transactions. Under this plan, $24 million has been allocated to the automatic repurchase of the shares in the amount of $2 million per month over the next twelve-month period irrespective of market conditions and represents an extension of a similar plan approved by the Board of Directors on December 19, 2001. Purchases under the plan will be made through December 18, 2003.

Led by strong growth in Biomet's reconstructive and spinal product lines, net sales increased 16% during the second quarter of fiscal year 2003, excluding the impact of foreign currency which increased second quarter sales by approximately $5.2 million. United States and international sales, excluding the effects of foreign currency, increased 16% and 17%, respectively.

Dane A. Miller, Ph.D., Biomet's President and Chief Executive Officer noted, "We are pleased with Biomet's second quarter operating results which continue to be propelled by balanced growth throughout the Company's multiple strategic business units. We believe that Biomet is extremely well positioned to capitalize on the continued growth in the fastest growing market segments within the musculoskeletal products marketplace with the broadest line of implantable musculoskeletal products available in the industry. The Company finished the quarter with strong momentum which gives us comfort that we should meet the range of analysts' sales and earnings estimates of $338 million to $353 million and $.27 to $.28 per share, respectively, for the third quarter of fiscal year 2003."

Unless otherwise noted, all of the following percentages are quoted on a constant-currency basis.

Worldwide sales of Biomet's reconstructive devices increased 19% during the second quarter of fiscal year 2003 to $211,914,000. Reconstructive devices were led by total hip sales, which increased 25% worldwide and 21% in the United States during the second quarter. Biomet's market leading total hip performance continues to be propelled by the Company's broad line of cementless total hip systems and advanced articulation metal-on-metal systems. Total knee sales increased 14% worldwide and 12% in the United States during the second quarter. Knee sales continue to be driven by Biomet's leadership position in the minimally-invasive, unicondylar knee market segment and continued penetration in the revision knee market segment. Extremity products increased 12% in the United States and 6% worldwide during the second quarter of fiscal year 2003.

Dental reconstructive implants increased 27% in the United States and 22% worldwide during the second quarter of fiscal year 2003, while bone cement and accessories increased 21% in the United States and 15% worldwide.

Fixation sales increased 9% to $58,427,000 during the second quarter of fiscal year 2003. Fixation sales were led by sales of craniomaxillofacial fixation systems, through the Company's Lorenz Surgical subsidiary, which increased 35% in the United States and 17% worldwide during the second quarter. Sales of electrical stimulation systems increased 9% in the United States and 8% worldwide during the second quarter. Internal fixation sales increased 7% worldwide and 6% in the United States during the second quarter, while external fixation sales increased 7% worldwide and 6% in the United States during the second quarter of fiscal year 2003.

Spinal sales increased 21% to $36,197,000 during the second quarter. Spinal sales in the United States increased 21% during the second quarter. Worldwide sales of spinal implants and orthobiological products for the spine increased 23% during the second quarter, while worldwide sales of spinal stimulation systems increased 21%.

Sales of Biomet's "other products" increased 9% during the second quarter of fiscal year 2003 to $34,910,000 and increased 13% in the United States. Arthroscopy sales increased 17% in the United States and 16% worldwide during the recently completed quarter, while softgoods and bracing products increased 7% worldwide and 7% in the United States during the recently completed quarter.

Biomet, Inc. and its subsidiaries design, manufacture and market products used primarily by musculoskeletal medical specialists in both surgical and non-surgical therapy, including reconstructive and fixation devices, electrical bone growth stimulators, orthopedic support devices, operating room supplies, general surgical instruments, arthroscopy products, spinal implants, bone cements and accessories, bone substitute materials, craniomaxillofacial implants and dental reconstructive implants and associated instrumentation. Headquartered in Warsaw, Indiana, Biomet and its subsidiaries currently distribute products in more than 100 countries.

For further information contact Greg W. Sasso, Vice President, Corporate Development and Communications at [phone] or Barbara Goslee, Manager, Corporate Communications at [phone].

This press release contains certain statements that are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. 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. 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.

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 [e-mail].

All trademarks are owned by Biomet, Inc., or one of its subsidiaries.

                  BIOMET, INC. - - QUARTERLY RESULTS

                  FOR THE QUARTERS ENDED NOVEMBER 30
                 (in thousands, except per share data)

                            Three Months Ended     Six Months Ended
                           --------------------  ---------------------

                              2002      2001        2002       2001
                              ----      ----        ----       ----
Net Sales                   $341,448  $289,387    $659,048   $561,409
Cost of Sales                 98,605    79,034     188,742    156,426
                           ---------- ---------  ---------- ----------
Gross Profit                 242,843   210,353     470,306    404,983

S, G, & A                    121,249   106,679     237,137    207,995
R & D                         13,069    11,987      25,707     23,655
                           ---------- ---------  ---------- ----------
Operating Income             108,525    91,687     207,462    173,333

Other Income, Net              2,858     4,371       6,802      8,935
                           ---------- ---------  ---------- ----------
Income Before Taxes
  And Minority Interest      111,383    96,058     214,264    182,268
Income Taxes                  38,544    32,607      74,138     61,876
                           ---------- ---------  ---------- ----------
Income Before
  Minority Interest           72,839    63,451     140,126    120,392
Minority Interest              2,485     1,999       3,766      2,927
                           ---------- ---------  ---------- ----------
Net Income                    70,354    61,452     136,360    117,465

Earnings per Share:
Basic                            .27       .23         .52        .44
Diluted                          .27       .23         .52        .43

Basic Shares                 259,499   269,809     260,862    269,635
Diluted Shares               261,626   272,822     262,925    272,747



U.S. sales                  $242,120  $208,917    $466,700   $408,119
Foreign sales                 99,328    80,470     192,348    153,290

Reconstructive sales         211,914   174,894     403,939    336,066
Fixation sales                58,427    53,236     117,808    106,882
Spinal products               36,197    29,692      69,463     57,151
Other product sales           34,910    31,565      67,838     61,310