C.R. Bard, Inc. : Bard Announces Fourth Quarter Results
01/31/2012| 04:10pm US/Eastern
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Revenue up 5 Percent, Diluted EPS of $1.30, $1.70 on Adjusted Basis
C. R. Bard, Inc. (NYSE: BCR) today reported 2011 fourth quarter
financial results. Fourth quarter 2011 net sales were $751.9 million, an
increase of 5 percent over the prior-year period, on both an as-reported
and constant currency basis.
For the fourth quarter 2011, net sales in the U.S. were $502.5 million
and net sales outside the U.S. were $249.4 million, an increase of 2
percent and 10 percent, respectively, over the prior-year period.
Excluding the impact of foreign exchange, fourth quarter 2011 net sales
outside the U.S. increased 9 percent over the prior-year period.
Net sales for the full year 2011 were $2,896.4 million, an increase of 6
percent over the prior-year period. Excluding the impact of foreign
exchange, full year 2011 net sales increased 5 percent over the
prior-year period.
For the fourth quarter 2011, net income attributable to common
shareholders was $113.8 million and diluted earnings per share available
to common shareholders were $1.30, a decrease of 16 percent and 12
percent, respectively, as compared to fourth quarter 2010 results.
Adjusting for items that affect comparability between periods as
detailed in the tables below, fourth quarter 2011 net income
attributable to common shareholders was $148.6 million and diluted
earnings per share available to common shareholders were $1.70, an
increase of 4 percent and 10 percent, respectively, as compared to
fourth quarter 2010 results.
For the full year 2011, net income attributable to common shareholders
was $328.0 million and diluted earnings per share available to common
shareholders were $3.69, a decrease of 36 percent and 31 percent,
respectively, as compared to full year 2010 results. Adjusting for items
that affect comparability between periods, full year 2011 net income
attributable to common shareholders was $568.9 million and diluted
earnings per share available to common shareholders were $6.40, an
increase of 6 percent and 14 percent, respectively, as compared to full
year 2010 results.
Timothy M. Ring, chairman and chief executive officer, commented,
"Fourth quarter constant currency net sales growth of 5% was at the top
end of our guidance and allowed us to exceed adjusted EPS guidance for
the quarter and for the year. Our revenue growth is being driven by a
combination of geographic investments, external acquisitions and
internal research and development. By combining top-line growth with
disciplined expense management and share-repurchase programs, we have
been able to meet our short-term commitments to shareholders while
positioning the company for healthy long-term growth."
C. R. Bard, Inc. (www.crbard.com),
headquartered in Murray Hill, NJ, is a leading multinational developer,
manufacturer and marketer of innovative, life-enhancing medical
technologies in the fields of vascular, urology, oncology and surgical
specialty products.
This press release may contain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act 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 such as legal proceedings, and other economic, business,
competitive and regulatory factors. The company undertakes no obligation
to update its forward-looking statements. Please refer to the Cautionary
Statement Regarding Forward-Looking Information in our September 30,
2011 Form 10-Q for more detailed information about these and other
factors that may cause actual results to differ materially from those
expressed or implied.
C. R. Bard, Inc.
Consolidated Statements of Income
(dollars and shares in thousands except per share amounts, unaudited)
Quarter Ended
Twelve Months Ended
December 31,
December 31,
2011
2010
2011
2010
Net sales
$
751,900
$
717,100
$
2,896,400
$
2,720,200
Costs and expenses
Cost of goods sold
282,100
263,700
1,097,300
1,020,000
Marketing, selling and administrative expense
214,200
204,700
794,600
759,800
Research and development expense
43,600
52,200
185,400
185,400
Interest expense
9,300
3,800
36,400
12,700
Other (income) expense, net
60,700
15,900
271,900
24,600
Total costs and expenses
609,900
540,300
2,385,600
2,002,500
Income from operations before income taxes
142,000
176,800
510,800
717,700
Income tax provision
28,200
40,600
182,800
208,100
Net income
113,800
136,200
328,000
509,600
Net income attributable to noncontrolling interest
-
-
-
400
Net income attributable to common shareholders
$
113,800
$
136,200
$
328,000
$
509,200
Basic earnings per share available to common shareholders
$
1.31
$
1.48
$
3.75
$
5.39
Diluted earnings per share available to common shareholders
$
1.30
$
1.47
$
3.69
$
5.32
Wt. avg. common shares outstanding - basic
85,200
90,800
85,800
93,400
Wt. avg. common and common equivalent shares outstanding - diluted
86,000
92,000
87,300
94,600
Product Group Summary of Net Sales
(dollars in thousands, unaudited)
Quarter Ended December 31,
Twelve Months Ended December 31,
Constant
Constant
2011
2010
Change
Currency
2011
2010
Change
Currency
Vascular
$
220,700
$
205,300
8
%
7
%
$
842,400
$
755,900
11
%
10
%
Urology
190,400
185,100
3
%
3
%
734,800
718,100
2
%
1
%
Oncology
201,400
189,200
6
%
6
%
779,500
724,800
8
%
6
%
Surgical Specialties
116,600
114,600
2
%
2
%
450,000
434,600
4
%
3
%
Other
22,800
22,900
-
-
89,700
86,800
3
%
3
%
Net sales
$
751,900
$
717,100
5
%
$
2,896,400
$
2,720,200
6
%
Foreign exchange impact
1,700
33,300
Constant Currency
$
751,900
$
718,800
5
%
$
2,896,400
$
2,753,500
5
%
Reconciliation of Earnings
(dollars in millions except per share amounts, unaudited)
Quarter Ended December 31, 2011
Diluted
Net
Earnings
Marketing,
Income
per Share
Cost of
Selling and
Research &
Other
Attributable
Available
Goods
Administrative
Development
(Income)
Income
to Common
to Common
Sold
Expense
Expense
Expense, Net
Taxes
Shareholders
Shareholders
GAAP Basis
$
282.1
$
214.2
$
43.6
$
60.7
$
28.2
$
113.8
$
1.30
Items that affect comparability of
results between periods:
Acquisition related items
-
(3.8
)
-
(4.1
)
1.0
6.9
Legal settlement
-
-
-
(51.0
)
10.2
40.8
Impairment of bonds
-
-
-
(4.5
)
-
4.5
Restructuring
-
-
-
1.1
(0.2
)
(0.9
)
Tax items
-
-
-
-
16.5
(16.5
)
Total
-
(3.8
)
-
(58.5
)
27.5
34.8
0.40
Adjusted Basis
$
282.1
$
210.4
$
43.6
$
2.2
$
55.7
$
148.6
$
1.70
Quarter Ended December 31, 2010
Diluted
Net
Earnings
Marketing,
Income
per Share
Cost of
Selling and
Research &
Other
Attributable
Available
Goods
Administrative
Development
(Income)
Income
to Common
to Common
Sold
Expense
Expense
Expense, Net
Taxes
Shareholders
Shareholders (1)
GAAP Basis
$
263.7
$
204.7
$
52.2
$
15.9
$
40.6
$
136.2
$
1.47
Items that affect comparability of
results between periods:
Acquisition related items
(0.4
)
(0.1
)
(2.1
)
-
0.6
2.0
Restructuring
-
-
-
(16.7
)
5.3
11.4
Tax items
-
-
-
-
6.2
(6.2
)
Total
(0.4
)
(0.1
)
(2.1
)
(16.7
)
12.1
7.2
0.08
Adjusted Basis
$
263.3
$
204.6
$
50.1
$
(0.8
)
$
52.7
$
143.4
$
1.54
Twelve Months Ended December 31, 2011
Diluted
Net
Earnings
Marketing,
Income
per Share
Cost of
Selling and
Research &
Other
Attributable
Available
Goods
Administrative
Development
(Income)
Income
to Common
to Common
Sold
Expense
Expense
Expense, Net
Taxes
Shareholders
Shareholders
GAAP Basis
$
1,097.3
$
794.6
$
185.4
$
271.9
$
182.8
$
328.0
$
3.69
Items that affect comparability of
results between periods:
Acquisition related items
0.4
(6.8
)
(3.5
)
(4.4
)
2.6
11.7
Legal settlements and commitments
-
-
-
(246.5
)
16.2
230.3
Impairment of bonds
-
-
-
(11.5
)
-
11.5
Restructuring
-
-
-
(7.8
)
2.8
5.0
Tax items
-
-
-
-
17.6
(17.6
)
Total
0.4
(6.8
)
(3.5
)
(270.2
)
39.2
240.9
2.71
Adjusted Basis
$
1,097.7
$
787.8
$
181.9
$
1.7
$
222.0
$
568.9
$
6.40
Twelve Months Ended December 31, 2010
Diluted
Net
Earnings
Marketing,
Income
per Share
Cost of
Selling and
Research &
Other
Attributable
Available
Goods
Administrative
Development
(Income)
Income
to Common
to Common
Sold
Expense
Expense
Expense, Net
Taxes
Shareholders
Shareholders
GAAP Basis
$
1,020.0
$
759.8
$
185.4
$
24.6
$
208.1
$
509.2
$
5.32
Items that affect comparability of
results between periods:
Acquisition related items
(3.2
)
(5.7
)
(2.6
)
(9.3
)
4.7
16.1
Write-down of receivables
-
(3.8
)
-
-
-
3.8
Restructuring
-
-
-
(16.7
)
5.3
11.4
Tax items
-
-
-
-
4.8
(4.8
)
Total
(3.2
)
(9.5
)
(2.6
)
(26.0
)
14.8
26.5
0.28
Adjusted Basis
$
1,016.8
$
750.3
$
182.8
$
(1.4
)
$
222.9
$
535.7
$
5.60
(1) Total per share amounts do not add due to rounding.
Notes to Reconciliation of Earnings
For the fourth quarter 2011, the following items affected the
comparability of results between periods: (i) charges of $7.9 million
pre-tax for acquisition related items including transaction costs,
purchase accounting adjustments and integration costs; (ii) a charge
of $51.0 million pre-tax related to a preliminary legal settlement;
(iii) a charge of $4.5 million pre-tax for the impairment of Greek
bonds; (iv) a net reversal of $1.1 million pre-tax for restructuring
costs; and (v) a decrease of $16.5 million in the income tax provision
associated with audit settlements related to the completion of IRS
examinations for the tax years from 2005 through 2007 and certain
examinations in a foreign jurisdiction. The net effect of these items
decreased net income attributable to common shareholders by $34.8
million, or $0.40 diluted earnings per share available to common
shareholders.
For the fourth quarter 2010, the following items affected the
comparability of results between periods: (i) a charge of $2.6 million
pre-tax for acquisition related items including purchased research and
development, transaction costs and purchase accounting adjustments;
(ii) a charge of $16.7 million pre-tax for restructuring; and (iii) a
decrease of $6.2 million in the income tax provision associated with
the completion of certain foreign tax examinations, and the expiration
of statutes of limitations in foreign jurisdictions. The net effect of
these items decreased net income attributable to common shareholders
by $7.2 million, or $0.08 diluted earnings per share available to
common shareholders.
For the twelve months ended December 31, 2011, the following items
affected the comparability of results between periods: (i) charges of
$14.3 million pre-tax for acquisition related items including
purchased research and development, transaction costs, purchase
accounting adjustments and integration costs; (ii) charges of $246.5
million pre-tax related to legal settlements and commitments; (iii)
charges of $11.5 million pre-tax for the impairment of Greek bonds;
(iv) net charges of $7.8 million pre-tax for restructuring; and (v) a
decrease of $17.6 million in the income tax provision associated with
audit settlements related to the completion of IRS examinations for
the tax years from 2005 through 2007 and certain examinations in other
jurisdictions. The net effect of these items decreased net income
attributable to common shareholders by $240.9 million, or $2.71
diluted earnings per share available to common shareholders.
For the twelve months ended December 31, 2010, the following items
affected the comparability of results between periods: (i) charges of
$20.8 million pre-tax for acquisition related items including
purchased research and development, transaction costs, purchase
accounting adjustments and integration costs; (ii) a charge of $3.8
million pre-tax for the write-down of public hospital receivables in
Greece; (iii) a charge of $16.7 million pre-tax for restructuring; and
(iv) a net decrease of $4.8 million in the income tax provision,
including a decrease of $10.4 million due to a remeasurement of
certain tax positions related to the completion of IRS examinations of
the tax years 2003 and 2004, the completion of certain foreign tax
examinations, and the expiration of statutes of limitations in foreign
jurisdictions, offset by an increase of $5.6 million due to cash
repatriation of certain foreign earnings as a result of new tax
legislation. The net effect of these items decreased net income
attributable to common shareholders by $26.5 million, or $0.28 diluted
earnings per share available to common shareholders.
This press release contains financial measures that are not calculated
in accordance with United States generally accepted accounting
principles (GAAP). These non-GAAP measures are reconciled to their most
directly comparable GAAP measures in the above tables.
This press release includes net sales excluding the impact of foreign
exchange. 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 to both management and the company's investors.
In addition, this press release includes the following non-GAAP
measures: (1) cost of goods sold excluding charges for acquisition
related items; (2) marketing, selling and administrative expense
excluding charges for acquisition related items and the write-down of
public hospital receivables in Greece; (3) research and development
expense excluding charges for acquisition related items; (4) other
(income) expense, net, excluding charges for acquisition related items,
legal settlements and commitments, the impairment of Greek bonds; and
charges for restructuring; (5) income tax provision excluding a decrease
due to audit settlements and reductions of certain tax positions, an
increase resulting from a cash repatriation of certain foreign earnings,
and the tax effect of the items set forth in (1) through (4) above; (6)
net income attributable to common shareholders excluding the items set
forth in (1) through (5) above; and (7) diluted earnings per share
available to common shareholders excluding the items set forth in (1)
through (5) above.
The company excluded the items described above because they may cause
certain statements of operations categories not to be indicative of
ongoing operating results, and therefore affect the comparability of
results between periods. The company therefore believes that these
non-GAAP measures provide an additional and meaningful assessment of the
company's ongoing operating performance. Because the company has
historically reported these non-GAAP results to the investment
community, management also believes that the inclusion of these non-GAAP
measures provides consistency in its financial reporting and facilitates
investors' understanding of the company's historic operating trends by
providing an additional basis for comparisons to prior periods.
Management uses these non-GAAP measures: (1) to establish financial and
operational goals; (2) to monitor the company's actual performance in
relation to its business plan and operating budgets; (3) to evaluate the
company's core operating performance and understand key trends within
the business; and (4) as part of several components it considers in
determining incentive compensation.
Management recognizes that the use of these non-GAAP measures has
limitations, including the fact that they may not be comparable with
similar non-GAAP measures used by other companies and that management
must exercise judgment in determining which types of charges or other
items should be excluded from the non-GAAP information. Management
compensates for these limitations by providing full disclosure of each
non-GAAP measure and a reconciliation to the most directly comparable
GAAP measure. All non-GAAP measures are intended to supplement the
applicable GAAP disclosures and should not be considered in isolation
from, or as a replacement for, financial information prepared in
accordance with GAAP. For a reconciliation of these non-GAAP measures to
the most comparable GAAP measures, please see the above tables.
Notes to Earnings per Share
(dollars and shares in thousands, except per share amounts,
unaudited)
Quarter Ended
Twelve Months Ended
December 31,
December 31,
2011
2010
2011
2010
Earnings per Share Numerator: GAAP Basis - basic and diluted
Net income attributable to common shareholders
$
113,800
$
136,200
$
328,000
$
509,200
Less: Income allocated to participating securities (1)
2,000
1,400
6,100
5,500
Net income available to common shareholders
$
111,800
$
134,800
$
321,900
$
503,700
Earnings per Share Numerator: Adjusted Basis - diluted
Net income attributable to common shareholders
$
148,600
$
143,400
$
568,900
$
535,700
Less: Income allocated to participating securities (1)
2,700
1,500
10,100
5,800
Net income available to common shareholders
$
145,900
$
141,900
$
558,800
$
529,900
Earnings per Share Denominator:
Wt. avg. common shares outstanding - basic
85,200
90,800
85,800
93,400
Wt. avg. common and common equivalent shares outstanding - diluted
86,000
92,000
87,300
94,600
Earnings per Share: GAAP Basis
Basic earnings per share available to common shareholders
$
1.31
$
1.48
$
3.75
$
5.39
Diluted earnings per share available to common shareholders
$
1.30
$
1.47
$
3.69
$
5.32
Earnings per Share: Adjusted Basis
Diluted earnings per share available to common shareholders
$
1.70
$
1.54
$
6.40
$
5.60
(1) Basic and diluted earnings per share available to common
shareholders is calculated using a numerator, which represents the total
of net income attributable to common shareholders less income allocated
to participating securities.
C. R. Bard, Inc. Investor Relations: Todd W.
Garner, (908) 277-8065 Vice President, Investor
Relations or Media Relations: Scott
T. Lowry, (908) 277-8365 Vice President and Treasurer
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