01—Abstract
Summary
Summary of the 10-K filed November 21, 2023. Cited figures are marked; the original filing is the authoritative source.
Becton, Dickinson and Company (BDX) reported fiscal year 2023 revenues of $19.372 billiona, a 2.7% increase over the prior year, driven by volume growth and pricing, although partially offset by a decline in COVID-19-related testing sales and foreign currency translation impacts.
The company's strategic objectives for value creation are centered around growing its portfolio, simplifying operations, and empowering its workforce. Despite inflationary pressures on raw materials, labor, and energy, BD maintained strong operating cash flows and returned value to shareholders through dividends. Key areas of focus include innovation in smart devices, expanding global access to medical technologies, and enhancing operational efficiencies.
However, the company continues to navigate challenges, including the ongoing remediation efforts related to its Alaris™ infusion pumps, which significantly impacted the Medical segment's operating income, and the broader impacts of global macroeconomic conditions and geopolitical factors. BDx operates across three main segments: Medical, Life Sciences, and Interventional, each contributing to its diverse product offerings. The company remains committed to investing in research and development to maintain its competitive edge in the dynamic medical technology landscape.
02—Key points
Key Highlights
- BDX reported fiscal year 2023 revenues of $19.372 billion, a 2.7% increase year-over-year, driven by volume, pricing, and acquisitions, though impacted by a decline in COVID-19 testing revenues.
- The Medical segment saw a 7.5% revenue increase, primarily due to strong catheter sales and growth in Medication Management Solutions (including Parata Systems acquisition) and Pharmaceutical Systems.
- The Life Sciences segment experienced a 7.8% revenue decrease, largely due to a significant drop in COVID-19-only diagnostic testing sales, partially offset by growth in Biosciences.
- The Interventional segment reported a 6.1% revenue increase, led by strong performance in Surgery and Peripheral Intervention, despite the divestiture of the Surgical Instrumentation platform.
- The company's cash flow from operations remained robust at $2.990 billion, supporting continued shareholder returns through dividends.
- Significant remediation costs related to Alaris™ infusion pumps impacted the Medical segment's operating income, with $653 million charged in fiscal year 2023.
- BDX continues to manage global macroeconomic challenges, including inflation and supply chain disruptions, through various cost-mitigation strategies and investments in operational efficiency.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2023, Becton Dickinson & Co kept $0.08.
- Revenue$19.37B100.0%
- Cost of revenue−$11.20B57.8%
- Gross profit$8.17B42.2%
- Operating costs−$6.06B31.3%
- Operating income$2.11B10.9%
- Interest, other & tax−$627.0M3.2%
- Net income$1.48B7.7%
Where FY2023 revenue went
$19.37B- Cost of revenue: $11.20B, 58% of revenue
- SG&A: $4.72B, 24% of revenue
- Net income: $1.48B, 7.7% of revenue
- R&D: $1.24B, 6.4% of revenue
- Other operating costs: $103.0M, 0.5% of revenue
- Interest, other & tax: $627.0M, 3.2% of revenue
Kept 7.7% as net incomeOther operating costs $103.0M · 0.5%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2023filed November 21, 2023Financial Statements
FY2023 against FY2022
| Line item | FY2023FY2022 | Change |
|---|---|---|
| Revenue | $19.37B$18.87B | +2.7% |
| Cost of Revenue | $11.20B$10.39B | +7.8% |
| Gross Profit | $8.17B$8.48B | −3.6% |
| R&D Expenses | $1.24B$1.26B | −1.5% |
| SG&A Expenses | $4.72B$4.71B | +0.2% |
| Operating Expenses | $17.26B$16.59B | +4.1% |
| Operating Income | $2.11B$2.28B | −7.5% |
| Interest Expense | $452.00M$398.00M | +13.6% |
| Net Income | $1.48B$1.78B | −16.6% |
| EPS (Basic) | $4.97$5.93 | −16.2% |
| EPS (Diluted) | $4.94$5.88 | −16.0% |
| Shares Outstanding (Basic) | 286.28M285.00M | +0.4% |
| Shares Outstanding (Diluted) | 288.39M287.36M | +0.4% |
05—Questions
Frequently Asked Questions
What were the main drivers of BDX's revenue growth in fiscal year 2023?
BDX's overall revenue growth of 2.7% in fiscal year 2023 was driven by a combination of increased volume (3.0%), favorable pricing (3.8%), and the impact of acquisitions. However, this growth was partially offset by a significant decline in revenues from COVID-19-only testing (-2.3%) and a negative impact from foreign currency translation (-1.8%).
How did the Alaris™ infusion pump remediation efforts affect BDX's financial performance?
The remediation efforts for the Alaris™ infusion pumps had a substantial impact, particularly on the Medical segment's operating income. In fiscal year 2023, BDX recorded charges of $653 million related to estimated future costs for these remediation efforts, compared to $72 million in the prior year. This significantly reduced the Medical segment's operating margin.
What is the company's strategy for future growth and value creation?
BDX's strategy, termed BD 2025, is anchored in three pillars: Grow, Simplify, and Empower. This involves developing a strong product portfolio, focusing on innovation (including smart devices and AI), expanding global reach, pursuing strategic acquisitions, driving operational efficiency, and fostering a purpose-driven and inclusive culture to empower its employees.
How is BDX managing inflationary pressures and supply chain challenges?
BDX is actively managing inflationary pressures on raw materials, labor, and energy through various strategies. These include leveraging procurement and logistics capabilities, implementing continuous improvement projects, selective price increases, and optimizing operational efficiencies. While these measures help mitigate impacts, the company acknowledges that persistent inflation and supply chain constraints remain challenges.
06—Continue