10-KPeriod: FY2007

BECTON DICKINSON & CO Annual Report, Year Ended Sep 30, 2007

Filed November 23, 2007For Securities:BDX

Summary

Becton, Dickinson and Company (BDX) reported its fiscal year results for the period ending September 30, 2007. The company operates across three global segments: BD Medical, BD Diagnostics, and BD Biosciences, offering a diverse range of medical supplies, devices, and diagnostic products. Key strategic developments in the fiscal year included the acquisitions of TriPath Imaging, Inc. and Plasso Technology, Ltd., aimed at strengthening BD's position in cancer diagnostics and advanced research tools, respectively. BD highlighted its ongoing commitment to innovation through substantial research and development investments. The company's extensive global manufacturing and distribution network supports its worldwide sales. Investors should note the competitive landscape and potential impacts of regulatory changes and third-party reimbursement policies on the company's performance. BD also faces ongoing litigation, which, while not currently assessed as material individually or in aggregate, remains a factor to monitor.

Financial Highlights

30 data points
Beta

Revenue

$6.28B

51.7% Gross Margin

Net Income

$890.03M

14.2% Net Margin

EPS (Diluted)

$3.49

Cash & Equivalents

$511.48M

Free Cash Flow

$673.66M

Financial Statements
Beta
Revenue$6.28B
Cost of Revenue$3.03B
Gross Profit$3.25B
SG&A Expenses$1.58B
Operating Expenses$5.10B
Operating Income$1.18B
Interest Expense$46.42M
Net Income$890.03M
EPS (Basic)$3.63
EPS (Diluted)$3.49

Key Highlights

  • 1BD operates through three key segments: Medical, Diagnostics, and Biosciences, offering a wide range of healthcare products and technologies.
  • 2The company made strategic acquisitions in fiscal year 2007, including TriPath Imaging for cancer diagnostics and Plasso Technology for research tools.
  • 3Significant investment in Research and Development (R&D) totaling $360 million in FY2007, alongside $122 million in acquired R&D, underscores a focus on innovation.
  • 4BD has a global presence with manufacturing facilities in numerous countries, indicating a diversified operational footprint.
  • 5The company is subject to extensive regulation by agencies like the FDA, which impacts product development, manufacturing, and marketing.
  • 6BD is involved in several ongoing legal proceedings, including antitrust and product liability lawsuits, though the company believes it has meritorious defenses.
  • 7The company repurchased approximately 500,498 shares of its common stock in the quarter ending September 30, 2007, as part of ongoing repurchase programs.

Frequently Asked Questions

The primary strategic drivers for BD in fiscal year 2007 included strengthening its position in cancer diagnostics through the acquisition of TriPath Imaging and enhancing its capabilities in advanced research tools with the acquisition of Plasso Technology. The company also continued to invest heavily in research and development to foster innovation across its business segments.

Key risks highlighted by BD include dependence on the successful development of new products, intense competition within the medical device industry, potential impacts of inflation and fluctuations in raw material costs, supply chain disruptions for certain raw materials, manufacturing interruptions, ongoing litigation, consolidation in the healthcare industry, changes in third-party reimbursement practices, product defects, extensive regulatory oversight, the success of strategic acquisitions, foreign currency exchange rate fluctuations, and potential adverse effects on the BD Biosciences segment from reductions in customer research budgets or government funding.

In November 2006, BD received a warning letter from the FDA concerning its San Lorenzo, Puerto Rico facility. The company developed and implemented a comprehensive corrective and preventive action plan, which was completed in fiscal year 2007. Subsequent FDA re-inspections found all commitments met and satisfactory, and BD is awaiting a close-out letter. BD believes it is in compliance in all material respects with applicable regulations.

BD is a defendant in several purported class action lawsuits alleging violations of federal antitrust laws, brought by both direct and indirect purchasers of BD's products. These cases have been consolidated for pre-trial purposes in a Multi-District Litigation (MDL) in federal court in New Jersey. BD maintains that it has meritorious defenses and is vigorously defending these matters.