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BD Announces Results for Second Quarter Fiscal 2010

Thursday, April 29, 2010 General News J E 4
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FRANKLIN LAKES, N.J., April 29 BD (Becton, Dickinson and Company) (NYSE: BDX) today reported quarterly revenues of $1.845 billion for the second fiscal quarter ended March 31, 2010, representing an increase of 7.0 percent from the prior-year period, or 6.6 percent on a foreign currency-neutral basis.

"We are pleased with our second quarter results, which are in line with the Company's expectations," said Edward J. Ludwig, Chairman and Chief Executive Officer. "Solid revenue growth in our Medical segment and a continued improvement in our Biosciences segment offset lower than expected growth in our Diagnostics segment. Our strong overall operating performance for the first half of fiscal 2010 gives us the confidence to reaffirm our guidance for full-year adjusted earnings."

Second Quarter and Six-Month Fiscal 2010 Operating Results

Reported diluted earnings per share from continuing operations for the second quarter were $1.24 compared with $1.05 in the prior-year period. Current quarter results included a non-cash charge of $8.9 million, or $0.04 per share from continuing operations related to healthcare reform impacting Medicare Part D reimbursements, and the prior-year period included a litigation charge of $45 million, or $0.11 per share. Excluding these items, adjusted diluted earnings per share from continuing operations increased by 8.5 percent to $1.27, compared with $1.17 adjusted earnings per share in the prior-year period. On a foreign currency-neutral basis, adjusted diluted earnings per share from continuing operations for the second quarter increased by 16.2 percent.

For the six-month period ending March 31, 2010, reported diluted earnings per share from continuing operations were $2.53 compared with $2.30 in the prior-year period. Excluding the aforementioned charges, diluted earnings per share from continuing operations were $2.57, an increase of 6.6 percent over adjusted diluted earnings per share from continuing operations of $2.41 in the prior-year period. On a foreign currency-neutral basis, adjusted diluted earnings per share from continuing operations for the six-month period increased 14.1 percent.

Segment Results

In the BD Medical segment, worldwide revenues for the quarter were $967 million, representing an increase of 9.7 percent compared with the prior-year period, or 7.8 percent on a foreign currency-neutral basis. Revenues reflect strong sales of Diabetes Care and Pharmaceutical Systems products. For the six-month period ended March 31, 2010, BD Medical revenues increased 13.0 percent, or 10.2 percent on a foreign currency-neutral basis.

In the BD Diagnostics segment, worldwide revenues for the quarter were $556 million, representing an increase of 3.0 percent compared with the prior-year period. Segment revenues increased 2.7 percent on a foreign currency-neutral basis, impacted by a reduction in lab testing and a decline in flu-related testing due to an exceptionally mild flu season. These were offset by strong growth in cancer and STD product platforms. For the six-month period ended March 31, 2010, BD Diagnostics revenues increased 6.6 percent, or 5.4 percent on a foreign currency-neutral basis.

In the BD Biosciences segment, worldwide revenues for the quarter were $322 million, representing an increase of 6.0 percent compared with the prior-year period. Revenues increased 9.8 percent on a foreign currency-neutral basis, driven by Cell Analysis and Discovery Labware growth in certain markets. For the six-month period ended March 31, 2010, BD Biosciences revenues increased by 3.0 percent, or 5.2 percent on a foreign currency-neutral basis.

Geographic Results

Second quarter revenues in the U.S. were $810 million, representing an increase of 6.0 percent from the prior-year period. Revenues outside of the U.S. were $1.035 billion, representing an increase of 7.7 percent compared with the prior-year period, or 7.0 percent on a foreign currency-neutral basis.

For the six-month period ended March 31, 2010, revenues in the U.S. were $1.683 billion, representing an increase of 7.9 percent compared with the prior-year period. Revenues outside of the U.S. were $2.078 billion, representing an increase of 10.4 percent compared with the prior-year period, or 7.8 percent on a foreign currency-neutral basis.

Fiscal 2010 Outlook

We expect reported revenues for the full year fiscal 2010 to increase approximately 6 percent, or about 1 percent less than our previously communicated guidance due to currency fluctuations. On a foreign currency-neutral basis, we expect revenues to increase approximately 6 percent, which is in line with our previously communicated guidance.

We also expect reported diluted earnings per share from continuing operations for the full year fiscal 2010 to be $5.01 to $5.11. Excluding the aforementioned charge of $0.04 related to healthcare reform impacting Medicare Part D reimbursements, we reaffirm our guidance that we expect diluted earnings per share from continuing operations for the full year fiscal 2010 will increase approximately 2 to 4 percent to $5.05 to $5.15, or 8 to 10 percent on a foreign currency-neutral basis. This is compared to adjusted diluted earnings per share from continuing operations, excluding the litigation charge of $0.11 and a tax benefit adjustment of $0.08, of $4.95 for fiscal year 2009. Reported diluted earnings per share from continuing operations for fiscal year 2009 were $4.92.

Conference Call Information

A conference call regarding BD's second quarter results and its expectations for the full fiscal year will be broadcast live on BD's website, www.bd.com/investors, along with related slides, at 10:00 a.m. (ET) Thursday, April 29, 2010. The conference call will be available for replay on BD's website, www.bd.com/investors, or at 1-800-642-1687 (domestic) and 1-706-645-9291 (international) through the close of business on May 6, 2010, access code 67104728.

Non-GAAP Financial Measures

This news release contains certain non-GAAP financial measures. Reconciliations of these and other non-GAAP measures to the comparable GAAP measures are included in the attached financial tables and the Form 8-K that BD filed today with the SEC.

About BD

BD is a leading global medical technology company that develops, manufactures and sells medical devices, instrument systems and reagents. The Company is dedicated to improving people's health throughout the world. BD is focused on improving drug delivery, enhancing the quality and speed of diagnosing infectious diseases and cancers, and advancing research, discovery and production of new drugs and vaccines. BD's capabilities are instrumental in combating many of the world's most pressing diseases. Founded in 1897 and headquartered in Franklin Lakes, New Jersey, BD employs approximately 29,000 associates in more than 50 countries throughout the world. The Company serves healthcare institutions, life science researchers, clinical laboratories, the pharmaceutical industry and the general public. For more information, please visit www.bd.com.

This press release contains certain estimates and other forward-looking statements (as defined under Federal securities laws) regarding BD's performance, including future revenues and earnings per share. All such statements are based upon current expectations of BD and involve a number of business risks and uncertainties. Actual results could vary materially from anticipated results described, implied or projected in any forward-looking statement. With respect to forward-looking statements contained herein, a number of factors could cause actual results to vary materially from any forward-looking statement. These factors include, but are not limited to: the unknown consequences of the recently-enacted healthcare reform in the United States, including the impact of the reduction in Medicare and Medicaid payments to hospitals, pharmaceutical companies and other customers, which could reduce demand for our products and increase downward pricing pressure; adverse changes in regional, national or foreign economic conditions, including any impact that may result from the current global economic downturn on our ability to access credit markets and finance our operations, the demand for our products and services, or our suppliers' ability to provide products needed for our operations; changes in interest or foreign currency exchange rates; competitive factors; pricing and market share pressures; difficulties inherent in product development and delays in product introductions; increases in energy costs and their effect on, among other things, the cost of producing BD's products; fluctuations in costs and availability of raw materials and in BD's ability to maintain favorable supplier arrangements and relationships; uncertainties of litigation (as described in BD's filings with the Securities and Exchange Commission); future healthcare reform, including changes in government pricing and reimbursement policies or other cost containment reforms; the effects of potential pandemic diseases; our ability to successfully integrate any businesses we acquire; and issuance of new or revised accounting standards, as well as other factors discussed in BD's filings with the Securities and Exchange Commission. We do not intend to update any forward-looking statements to reflect events or circumstances after the date hereof except as required by applicable laws or regulations.





BECTON DICKINSON AND COMPANY CONSOLIDATED INCOME STATEMENTS (Unaudited; Amounts in thousands, except per share data) Three Months Ended March 31, 2010 2009 % Change ---- ---- -------- REVENUES $1,844,854 $1,724,967 7.0 Cost of products sold 886,895 829,350 6.9 Selling and administrative 426,346 436,359 (2.3) Research and development 101,118 98,588 2.6 ------------ ------- ------ --- TOTAL OPERATING COSTS AND EXPENSES 1,414,359 1,364,297 3.7 --------- --------- --------- --- OPERATING INCOME 430,495 360,670 19.4 Interest income 9,652 4,312 NM Interest expense (12,913) (7,495) 72.3 Other income (expense), net 164 (5,701) NM ----------- --- ------ --- INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES 427,398 351,786 21.5 Income tax provision 129,673 92,612 40.0 ---------- ------- ------ ---- INCOME FROM CONTINUING OPERATIONS 297,725 259,174 14.9 (LOSS) INCOME FROM DISCONTINUED OPERATIONS NET OF INCOME TAX (BENEFIT) PROVISION OF $(54) 11, RESPECTIVELY (94) 2,115 NM ------------- --- ----- --- NET INCOME $297,631 $261,289 13.9 ---------- -------- -------- ---- EARNINGS PER SHARE Basic: Income from continuing operations $1.27 $1.08 17.6 (Loss) income from discontinued operations $ - $0.01 NM Net income (1) $1.26 $1.09 15.6 Diluted: Income from continuing operations $1.24 $1.05 18.1 (Loss) income from discontinued operations $ - $0.01 NM Net income $1.24 $1.06 17.0 AVERAGE SHARES OUTSTANDING Basic 235,325 240,239 Diluted 240,863 245,890 ------- ------- ------- NM -Not Meaningful (1) Total per share amounts may not add due to rounding

SOURCE BD (Becton, Dickinson and Company)
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