10-QPeriod: Q2 FY2022

BECTON DICKINSON & CO Quarterly Report for Q2 Ended Mar 31, 2022

Filed May 5, 2022For Securities:BDX

Summary

Becton Dickinson and Company (BDX) reported its fiscal second-quarter 2022 results, showcasing a modest revenue increase of 2.1% year-over-year to $5.011 billion. This growth was primarily driven by robust performance in the Medical and Interventional segments, with the Life Sciences segment experiencing a decline, largely due to a significant drop in COVID-19 diagnostic testing revenue compared to the prior year. Despite the revenue increase, net income saw a substantial rise to $454 million from $299 million in the same period last year, translating to diluted EPS of $1.50, up from $0.94. This improvement in profitability was aided by the resolution of certain legal matters that impacted the prior year's results, as well as cost management initiatives. The company also announced the completion of the spin-off of its Diabetes Care business (Embecta Corp.) on April 1, 2022. This strategic move is expected to allow BD to focus on its core businesses. While managing ongoing inflationary pressures and supply chain disruptions remains a key focus, BD generated strong operating cash flow and continues to return capital to shareholders through dividends. Investors should monitor the company's ability to navigate macroeconomic headwinds, integrate strategic acquisitions, and the impact of ongoing litigation and regulatory matters.

Financial Highlights

53 data points
Beta

Revenue

$4.75B

44.5% Gross Margin

Net Income

$454.00M

9.6% Net Margin

EPS (Diluted)

$1.50

Total Assets

$54.79B

Cash & Equivalents

$3.32B

Free Cash Flow

$222.00M

Financial Statements
Beta
Revenue$4.75B
Cost of Revenue$2.64B
Gross Profit$2.11B
R&D Expenses$327.00M
SG&A Expenses$1.19B
Operating Expenses$4.18B
Operating Income$564.00M
Interest Expense$97.00M
Net Income$454.00M
EPS (Basic)$1.51
EPS (Diluted)$1.50
Shares Outstanding (Basic)285.24M
Shares Outstanding (Diluted)287.30M

Key Highlights

  • 1Revenue increased by 2.1% to $5.011 billion for the quarter ended March 31, 2022, compared to the prior year.
  • 2Net income surged to $454 million, a significant increase from $299 million in the prior-year period.
  • 3Diluted Earnings Per Share (EPS) rose to $1.50 from $0.94 in the comparable prior-year quarter.
  • 4Completed the spin-off of its Diabetes Care business (Embecta Corp.) effective April 1, 2022.
  • 5Medical and Interventional segments showed strong revenue growth, while Life Sciences declined due to lower COVID-19 testing sales.
  • 6The company continues to face and mitigate inflationary pressures and supply chain disruptions.
  • 7Operating cash flow for the six months ended March 31, 2022, was $1.118 billion.

Frequently Asked Questions

The COVID-19 pandemic continued to influence BDX's performance. While demand for COVID-19 diagnostic tests declined significantly compared to the prior year, impacting the Life Sciences segment's revenue, other areas of the business saw recovery in routine healthcare utilization. The pandemic also contributed to inflationary pressures and supply chain disruptions that the company is actively managing.

The spin-off of the Diabetes Care business, now operating as Embecta Corp., on April 1, 2022, allows BDX to sharpen its strategic focus on its core Medical, Life Sciences, and Interventional segments. This separation is expected to simplify the company's structure and enable more targeted investments and growth initiatives in its primary areas of operation.

BDX is navigating several macroeconomic challenges, including significant inflation impacting raw materials, labor, and logistics costs. Supply chain disruptions, such as shortages of components and constrained logistics capacity, are also key concerns. The company is implementing strategies like strategic procurement, continuous improvement programs, and price adjustments to mitigate these pressures.

Becton Dickinson is committed to returning value to shareholders through dividends. During the first six months of fiscal year 2022, the company paid $541 million in cash dividends, including $496 million to common shareholders and $45 million to preferred shareholders. The company also has share repurchase programs in place.