10-KPeriod: FY2016

BECTON DICKINSON & CO Annual Report, Year Ended Sep 30, 2016

Filed November 23, 2016For Securities:BDX

Summary

Becton, Dickinson and Company (BDX) reported robust revenue growth in fiscal year 2016, driven significantly by the full-year inclusion of its CareFusion acquisition. Total revenues reached $12.48 billion, a 21.4% increase over the prior year. The company operates through two main segments: BD Medical and BD Life Sciences, both contributing to the overall revenue growth, with Medical showing a substantial 34.0% increase year-over-year, largely due to the CareFusion integration. The company continued its strategic focus on increasing revenue growth through core products, R&D investment, emerging market expansion, and operational efficiency. Despite increased debt related to the CareFusion acquisition, BD maintained its investment-grade credit rating and generated strong operating cash flows, highlighting its financial stability and commitment to shareholder returns through dividends.

Financial Highlights

56 data points
Beta

Revenue

$12.48B

48.0% Gross Margin

Net Income

$976.00M

7.8% Net Margin

EPS (Diluted)

$4.49

Total Assets

$25.59B

Cash & Equivalents

$1.54B

Free Cash Flow

$1.87B

Financial Statements
Beta
Revenue$12.48B
Cost of Revenue$6.49B
Gross Profit$5.99B
R&D Expenses$828.00M
SG&A Expenses$3.00B
Operating Expenses$11.05B
Operating Income$1.43B
Interest Expense$388.00M
Net Income$976.00M
EPS (Basic)$4.59
EPS (Diluted)$4.49
Shares Outstanding (Basic)212.70M
Shares Outstanding (Diluted)217.54M

Key Highlights

  • 1Revenue increased by 21.4% to $12.48 billion in fiscal year 2016, primarily driven by the full-year impact of the CareFusion acquisition.
  • 2The BD Medical segment saw a significant revenue increase of 34.0%, largely due to the integration of CareFusion's product lines.
  • 3Research and development expenses increased by 31.3% to $828 million, reflecting continued investment in innovation and new product platforms.
  • 4The company reported diluted earnings per share of $4.49, a substantial increase from $3.35 in the prior year, aided by revenue growth and operational improvements.
  • 5Total assets stood at $25.59 billion, with total debt at $11.55 billion, reflecting the financial leverage from the CareFusion acquisition.
  • 6BD generated $2.56 billion in cash from operating activities, demonstrating strong cash flow generation capabilities.
  • 7The company maintained its investment-grade credit rating with a stable outlook from major rating agencies, despite increased debt levels.

Frequently Asked Questions

The primary driver of Becton, Dickinson and Company's (BDX) revenue growth in fiscal year 2016 was the full-year impact of its acquisition of CareFusion Corporation, which closed in March 2015. This acquisition significantly boosted the BD Medical segment's performance.

The CareFusion acquisition significantly increased BD's total assets and long-term debt. While this provided a broader product portfolio and market reach, it also led to higher interest expenses and a higher debt-to-capitalization ratio, though the company maintained investment-grade credit ratings.

BD's strategy focuses on increasing revenue growth through its core products, investing in research and development for innovative new products, expanding operations in emerging markets, improving operational effectiveness, and optimizing its capital structure to deliver strong shareholder returns.

Key risks include global economic conditions, intense competition in the medical technology industry, foreign currency exchange rate fluctuations, changes in third-party reimbursement practices, regulatory changes, potential cybersecurity breaches, and challenges associated with integrating acquisitions and developing new products.