01—Abstract
Summary
Summary of the 10-K filed November 25, 2020. Cited figures are marked; the original filing is the authoritative source.
Becton, Dickinson and Company (BDX) reported revenues of $17.12 billiona for the fiscal year ended September 29, 2020, a slight decrease of 1.0% from the prior year, primarily impacted by the COVID-19 pandemic, which reduced overall volume by an estimated 3.3%.
Despite the pandemic's challenges, the Life Sciences segment saw growth driven by COVID-19 diagnostic testing. The company's financial position remained strong, with significant cash flows from operations, and it continued to return value to shareholders through dividends. However, BD faces ongoing risks including the unpredictable impact of the COVID-19 pandemic, competition, foreign currency fluctuations, and regulatory challenges, notably an amended consent decree with the FDA for its Alaris infusion pumps.
The company's strategic objectives focus on growing its product portfolio, simplifying operations, and empowering its workforce. Significant investments in research and development are ongoing to drive innovation.
BD also addressed its capital structure, managing debt and completing equity offerings to enhance financial flexibility. Investors should monitor the company's progress in navigating the pandemic's effects and its ongoing remediation efforts for the Alaris system.
02—Key points
Key Highlights
- Total revenues for FY2020 were $17.12 billion, a 1.0% decrease year-over-year, largely due to the COVID-19 pandemic's impact on demand and elective procedures.
- The Life Sciences segment experienced revenue growth, primarily driven by increased sales of COVID-19 diagnostic tests.
- The company maintained a strong financial position, generating $3.54 billion in cash flow from operating activities.
- BD paid $1.03 billion in dividends to shareholders during FY2020.
- The company is addressing regulatory challenges, including ongoing remediation for its BD Alaris infusion pump system and a consent order related to ethylene oxide emissions.
- BD continues to invest in R&D and strategic initiatives to drive future growth across its Medical, Life Sciences, and Interventional segments.
- The company completed significant equity offerings in May 2020, raising approximately $2.92 billion to enhance financial flexibility.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2020, Becton Dickinson & Co kept $0.05.
- Revenue$16.07B100.0%
- Cost of revenue−$8.50B52.9%
- Gross profit$7.58B47.1%
- Operating costs−$6.67B41.5%
- Operating income$912.0M5.7%
- Interest, other & tax−$38.0M0.2%
- Net income$874.0M5.4%
Where FY2020 revenue went
$16.07B- Cost of revenue: $9.28B, 58% of revenue
- SG&A: $4.18B, 26% of revenue
- Net income: $874.0M, 5.4% of revenue
- R&D: $1.04B, 6.5% of revenue
- Other operating costs: $662.0M, 4.1% of revenue
Kept 5.4% as net incomeNet income $874.0M · 5.4%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2020filed November 25, 2020Financial Statements
FY2020 against FY2019
| Line item | FY2020FY2019 | Change |
|---|---|---|
| Revenue | $16.07B$17.29B | −7.0% |
| Cost of Revenue | $9.28B$9.00B | +3.0% |
| Gross Profit | $7.58B$8.29B | −8.6% |
| R&D Expenses | $1.04B$1.06B | −2.2% |
| SG&A Expenses | $4.18B$4.33B | −3.4% |
| Operating Expenses | $15.16B$15.53B | −2.4% |
| Operating Income | $912.00M$1.76B | −48.2% |
| Interest Expense | $528.00M$639.00M | −17.4% |
| Net Income | $874.00M$1.23B | −29.1% |
| EPS (Basic) | $2.75$4.01 | −31.4% |
| EPS (Diluted) | $2.71$3.94 | −31.2% |
| Shares Outstanding (Basic) | 278.97M269.94M | +3.3% |
| Shares Outstanding (Diluted) | 282.40M274.77M | +2.8% |
05—Questions
Frequently Asked Questions
How did the COVID-19 pandemic affect BD's financial performance in fiscal year 2020?
The COVID-19 pandemic had a mixed impact. It led to significant reductions in demand for certain products due to fewer elective medical procedures and decreased diagnostic testing. However, the Life Sciences segment saw growth from COVID-19 diagnostic testing. Overall, the pandemic is estimated to have reduced BD's total consolidated revenues by approximately $600 million in fiscal year 2020.
What are the key business segments of Becton, Dickinson and Company?
BD operates through three main business segments: BD Medical, which offers a broad range of medical technologies and devices; BD Life Sciences, which provides products for specimen collection and diagnostic systems; and BD Interventional, which offers vascular, urology, oncology, and surgical specialty products.
What are the major risks and challenges highlighted by BD in its 10-K filing?
Key risks include the ongoing and unpredictable impact of the COVID-19 pandemic, intense competition in the medical technology industry, foreign currency exchange rate fluctuations, changes in third-party reimbursement practices, the potential inability to develop new products successfully, and risks associated with international operations. Regulatory challenges, such as the FDA consent decree for the Alaris infusion pumps, are also significant.
How is BD managing its debt and capital structure?
BD incurred significant debt for the C.R. Bard acquisition, which it has been managing through debt repayments and refinancing activities. In May 2020, the company completed equity offerings to raise capital, enhancing its financial flexibility and supporting its growth strategy. The company also has a revolving credit facility in place.
06—Continue