DENTSPLY SIRONA Inc. (“Dentsply Sirona”) (Nasdaq: XRAY), The Dental
Solutions Company, today announced its financial results for the
three months ended September 30, 2020.
Don Casey, CEO commented: “Our third quarter results reflect a
recovery in global dental markets, the actions we took to address
pandemic related challenges, and the ongoing structural changes
designed to improve our performance over the long-term. While
we saw an encouraging improvement in business trends during the
quarter, the outlook remains uncertain as a second wave of the
pandemic impacts various countries around the world. We
remain focused on delivering on our strategic imperatives to drive
growth and innovation, while taking appropriate actions to manage
our costs in the uncertain environment.”
Q3 20 Summary Results (GAAP)
(in millions, except per share amount and
percentages) |
|
Q3 20 |
|
Q3 19 |
|
YoY |
Net Sales |
|
895 |
|
962 |
|
(7.0%) |
Operating Income |
|
82 |
|
110 |
|
(25.4%) |
Operating Income % |
|
9.1% |
|
11.4% |
|
|
Diluted EPS |
|
0.25 |
|
0.38 |
|
(34.2%) |
Q3 20 Summary Results
(Non-GAAP)[1]
(in millions, except per share amount and
percentages) |
|
Q3 20 |
|
Q3 19 |
|
YoY |
Net Sales |
|
895 |
|
962 |
|
(7.0%) |
Organic Sales Growth % |
|
|
|
|
|
(8.8%) |
Operating Income |
|
197 |
|
172 |
|
14.3% |
Operating Income % |
|
22.0% |
|
17.9% |
|
|
Diluted EPS |
|
0.67 |
|
0.57 |
|
17.5% |
[1] Organic sales growth, Non-GAAP operating income, and
Non-GAAP EPS are Non-GAAP financial measures which exclude certain
items. Please refer to "Non-GAAP Financial Measures" below for a
description of these measures and to the tables at the end of this
release for a reconciliation between GAAP and Non-GAAP
measures.
Segment Results
Technologies & Equipment Segment
Third quarter 2020 sales were $504 million, down 5.7% versus
prior year. Currency increased sales by 1.9%, while divestitures
and discontinued products positively impacted sales by 0.9%. On an
organic basis, net sales declined by 8.5%. Healthcare had
positive organic growth, Equipment & Instruments sales were
flat, offset by declines in Digital Dentistry.
Consumables Segment
Third quarter 2020 sales were $391 million, down 8.6% as
compared to the prior year quarter. Foreign currency
favorably impacted sales by 0.6%, while divestitures and
discontinued products increased sales growth by 0.1%. On an
organic basis, consumables sales declined by 9.3% as compared to
prior year. The decline in organic sales was driven by the
Rest of World and Europe, partially offset by increased U.S.
sales. All product groups declined compared to prior year,
with Laboratory sales being the most impacted category.
Cash Flow and Liquidity
Operating cash flow in the third quarter of 2020 was $207
million, as compared to $159 million in the third quarter of
2019. The increase in cash flow was driven by the higher
level of earnings and continued effective working capital
management. In the third quarter, the Company paid $21
million in dividends, bringing a total of $205 million returned to
shareholders in the first nine months of 2020. At September 30,
2020, the Company had $1.3 billion of cash available on its balance
sheet.
Fiscal Year 2020 Outlook
As a result of the uncertainty around the duration of the
COVID-19 pandemic and its impact on the business, the Company
continues to not provide 2020 guidance.
Recent Announcements & Additional
Highlights
Introduced Axeos™ 2D and 3D Imaging
System
The Axeos imaging system has a large 3D Field of View for ortho,
implant, maxillofacial surgery and upper airway
analysis. Axeos is equipped with a direct conversion sensor
and Dentsply Sirona’s Sidexis 4 imaging software and is compatible
with a wide variety of Practice Management Systems and planning
software.
Appointed New Board Member
Recently, the Company announced that Clyde R. Hosein had been
appointed to its Board of Directors, increasing the size of
its Board from eleven to twelve members. Mr. Hosein brings
deep experience in the management of high-tech companies and a
strong track record of financial and operational execution to the
Board.
Conference Call/Webcast Information
Dentsply Sirona’s management team will host an investor
conference call and live webcast on November 5, 2020 at 8:30 am ET.
A presentation will also be available on www.dentsplysirona.com in
the Investors section.
Investors can access the webcast via a link on Dentsply Sirona’s
web site at www.dentsplysirona.com. For those planning to
participate on the call, please dial +1-877-370-7637 for domestic
calls, or +1-629-228-0723 for international calls. The Conference
ID # is 2187918. A replay of the conference call will be available
online on the Dentsply Sirona web site, and a dial-in replay will
be available for one week following the call at +1-855-859-2056
(for domestic calls) or +1-404-537-3406 (for international calls),
replay passcode # 2187918.
About Dentsply Sirona
Dentsply Sirona is the world’s largest manufacturer of
professional dental products and technologies, with a 133-year
history of innovation and service to the dental industry and
patients worldwide. Dentsply Sirona develops, manufactures, and
markets a comprehensive solutions offering including dental
equipment and dental consumable products under a strong portfolio
of world class brands. The Company also manufactures and markets
healthcare consumable products. As The Dental Solutions Company,
Dentsply Sirona’s products provide innovative, high-quality and
effective solutions to advance patient care and deliver better,
safer and faster dentistry. The Company’s shares of common stock
are listed in the United States on Nasdaq under the symbol XRAY.
Visit www.dentsplysirona.com for more information about Dentsply
Sirona and its products.
Contact
Information:Investors:John Sweeney, CFA, IRCVice
President, Investor
Relations+1-717-849-7863John.Sweeney@dentsplysirona.com
Forward-Looking Statements and
Associated Risks
All statements in this press release that do not directly and
exclusively relate to historical facts constitute “forward-looking
statements.” These statements represent current expectations and
beliefs, and no assurance can be given that the results described
in such statements will be achieved. Such statements are subject to
numerous assumptions, risks, uncertainties and other factors that
could cause actual results to differ materially from those
described in such statements, many of which are outside of our
control. Furthermore, many of these risks and uncertainties are
currently amplified by and may continue to be amplified by or may,
in the future, be amplified by, the novel coronavirus (“COVID-19”)
pandemic and the impact of varying private and governmental
responses that affect our customers, employees, vendors and the
economies and communities where they operate. For a written
description of these factors, see the section titled “Risk Factors”
in Dentsply Sirona’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2019 and any updating information in subsequent
SEC filings including the Company's Quarterly Report on Form 10-Q
for the quarterly period ending September 30, 2020. No assurance
can be given that any expectation, belief, goal or plan set forth
in any forward-looking statement can or will be achieved, and
readers are cautioned not to place undue reliance on such
statements which speak only as of the date they are made. We do not
undertake any obligation to update or release any revisions to any
forward-looking statement or to report any events or circumstances
after the date of this press release or to reflect the occurrence
of unanticipated events.
DENTSPLY SIRONA INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (unaudited)(In millions, except per share
amounts)
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
|
|
|
|
|
|
|
|
Net sales |
$ |
894.8 |
|
|
$ |
962.1 |
|
|
$ |
2,259.7 |
|
|
|
$ |
2,917.7 |
|
|
|
|
|
|
|
|
|
Cost of products
sold |
452.5 |
|
|
448.1 |
|
|
1,173.5 |
|
|
|
1,363.2 |
|
|
|
|
|
|
|
|
|
Gross profit |
442.3 |
|
|
514.0 |
|
|
1,086.2 |
|
|
|
1,554.5 |
|
|
|
|
|
|
|
|
|
Selling, general,
and administrative expenses |
341.9 |
|
|
399.3 |
|
|
1,014.5 |
|
|
|
1,262.1 |
|
|
|
|
|
|
|
|
|
Goodwill
impairment |
— |
|
|
— |
|
|
156.6 |
|
|
|
— |
|
|
|
|
|
|
|
|
|
Restructuring and
other costs |
18.7 |
|
|
5.2 |
|
|
62.5 |
|
|
|
68.1 |
|
|
|
|
|
|
|
|
|
Operating income
(loss) |
81.7 |
|
|
109.5 |
|
|
(147.4 |
) |
|
|
224.3 |
|
|
|
|
|
|
|
|
|
Net interest and
other expense (income) |
15.0 |
|
|
3.0 |
|
|
35.5 |
|
|
|
16.4 |
|
|
|
|
|
|
|
|
|
Income (loss)
before income taxes |
66.7 |
|
|
106.5 |
|
|
(182.9 |
) |
|
|
207.9 |
|
|
|
|
|
|
|
|
|
Provision
(benefit) for income taxes |
12.5 |
|
|
21.5 |
|
|
(1.3 |
) |
|
|
47.3 |
|
|
|
|
|
|
|
|
|
Net income
(loss) |
54.2 |
|
|
85.0 |
|
|
(181.6 |
) |
|
|
160.6 |
|
|
|
|
|
|
|
|
|
Less: Net income
(loss) attributable to noncontrolling interest |
0.4 |
|
|
— |
|
|
(0.1 |
) |
|
|
— |
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Dentsply Sirona |
$ |
53.8 |
|
|
$ |
85.0 |
|
|
$ |
(181.5 |
) |
|
|
$ |
160.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
per common share attributable to Dentsply Sirona: |
|
|
|
|
|
|
|
Basic |
$ |
0.25 |
|
|
$ |
0.38 |
|
|
$ |
(0.83 |
) |
|
|
$ |
0.72 |
|
Diluted |
$ |
0.25 |
|
|
$ |
0.38 |
|
|
$ |
(0.83 |
) |
|
|
$ |
0.71 |
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding: |
|
|
|
|
|
|
|
Basic |
218.5 |
|
|
223.1 |
|
|
219.4 |
|
|
|
223.5 |
|
Diluted |
219.2 |
|
|
224.9 |
|
|
219.4 |
|
|
|
225.2 |
|
|
|
|
|
|
|
|
|
DENTSPLY SIRONA INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)(In millions)
|
September 30, 2020 |
|
December 31, 2019 |
|
|
|
|
Assets |
|
|
|
Current
Assets: |
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
1,272.0 |
|
|
$ |
404.9 |
|
Accounts and notes receivables-trade, net |
628.1 |
|
|
782.0 |
|
Inventories, net |
489.1 |
|
|
561.7 |
|
Prepaid expenses and other current assets |
190.4 |
|
|
251.3 |
|
|
|
|
|
Total Current Assets |
2,579.6 |
|
|
1,999.9 |
|
|
|
|
|
Property, plant
and equipment, net |
772.4 |
|
|
802.4 |
|
Operating lease
right-of-use assets, net |
144.1 |
|
|
159.3 |
|
Identifiable
intangible assets, net |
2,058.1 |
|
|
2,176.3 |
|
Goodwill |
3,282.7 |
|
|
3,396.5 |
|
Other noncurrent
assets |
59.0 |
|
|
68.5 |
|
|
|
|
|
Total Assets |
$ |
8,895.9 |
|
|
$ |
8,602.9 |
|
|
|
|
|
Liabilities and Equity |
|
|
|
Current
Liabilities: |
|
|
|
Accounts payable |
$ |
242.8 |
|
|
$ |
307.9 |
|
Accrued liabilities |
564.1 |
|
|
629.2 |
|
Income taxes payable |
75.2 |
|
|
56.1 |
|
Notes payable and current portion of long-term debt |
296.1 |
|
|
2.3 |
|
|
|
|
|
Total Current Liabilities |
1,178.2 |
|
|
995.5 |
|
|
|
|
|
Long-term
debt |
1,930.0 |
|
|
1,433.1 |
|
Operating lease
liabilities |
105.4 |
|
|
119.5 |
|
Deferred income
taxes |
423.1 |
|
|
479.6 |
|
Other noncurrent
liabilities |
496.9 |
|
|
480.3 |
|
|
|
|
|
Total Liabilities |
4,133.6 |
|
|
3,508.0 |
|
|
|
|
|
Total Equity |
4,762.3 |
|
|
5,094.9 |
|
|
|
|
|
Total Liabilities and Equity |
$ |
8,895.9 |
|
|
$ |
8,602.9 |
|
|
|
|
|
DENTSPLY SIRONA INC. AND
SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)(In millions)
|
Nine Months Ended September 30, |
|
2020 |
|
2019 |
Cash
flows from operating activities: |
|
|
|
Net (loss)
income |
$ |
(181.6 |
) |
|
$ |
160.6 |
|
Adjustments to
reconcile net (loss) income to net cash provided by operating
activities: |
|
|
|
Depreciation |
103.8 |
|
|
101.6 |
|
Amortization of intangible assets |
142.6 |
|
|
142.9 |
|
Amortization of deferred financing costs |
3.4 |
|
|
2.1 |
|
Fixed asset impairment |
2.4 |
|
|
33.4 |
|
Deferred income taxes |
(52.7 |
) |
|
(39.9 |
) |
Stock based compensation expense |
36.2 |
|
|
49.8 |
|
Restructuring and other costs - non-cash |
5.8 |
|
|
15.2 |
|
Goodwill impairment |
156.6 |
|
|
— |
|
Indefinite-lived intangible asset impairment |
38.7 |
|
|
5.3 |
|
Definite-lived intangible asset impairment |
— |
|
|
3.8 |
|
Other non-cash income |
(4.7 |
) |
|
(12.4 |
) |
Loss on disposal of property, plant and equipment |
0.7 |
|
|
2.9 |
|
Gain on divestiture of noncontrolling interest |
— |
|
|
(8.7 |
) |
Loss on sale of non-strategic businesses and product lines |
— |
|
|
14.0 |
|
Changes in operating assets and liabilities, net of
acquisitions: |
|
|
|
Accounts and notes receivable-trade, net |
149.1 |
|
|
(20.7 |
) |
Inventories, net |
73.8 |
|
|
(48.4 |
) |
Prepaid expenses and other current assets |
50.2 |
|
|
(3.6 |
) |
Other noncurrent assets |
8.0 |
|
|
(14.4 |
) |
Accounts payable |
(64.7 |
) |
|
(30.5 |
) |
Accrued liabilities |
(72.6 |
) |
|
(35.5 |
) |
Income taxes |
(9.9 |
) |
|
11.4 |
|
Other noncurrent liabilities |
(13.6 |
) |
|
4.6 |
|
Net cash
provided by operating activities |
371.5 |
|
|
333.5 |
|
|
|
|
|
Cash
flows from investing activities: |
|
|
|
Capital
expenditures |
(60.0 |
) |
|
(86.9 |
) |
Liquidation of
short term investments |
— |
|
|
0.1 |
|
Cash paid for
acquisitions of businesses and equity investments, net of cash
acquired |
(2.0 |
) |
|
(3.3 |
) |
Cash received on
sale of non-strategic businesses or product lines |
— |
|
|
11.6 |
|
Cash received on
derivative contracts |
57.8 |
|
|
34.5 |
|
Cash paid on
derivative contracts |
(0.9 |
) |
|
— |
|
Proceeds from
sale of property, plant and equipment, net |
0.7 |
|
|
4.3 |
|
Net cash
used in investing activities |
(4.4 |
) |
|
(39.7 |
) |
|
|
|
|
Cash
flows from financing activities: |
|
|
|
Repayments on
short-term borrowings |
(1.2 |
) |
|
(67.4 |
) |
Cash paid for
treasury stock |
(140.0 |
) |
|
(160.0 |
) |
Cash dividends
paid |
(65.9 |
) |
|
(58.7 |
) |
Cash paid for
contingent consideration on prior acquisitions |
(3.0 |
) |
|
(30.7 |
) |
Cash paid for
acquisition of noncontrolling interest of consolidated
subsidiary |
(2.3 |
) |
|
— |
|
Proceeds from
long-term borrowings |
1,448.5 |
|
|
119.6 |
|
Repayments of
long-term borrowings |
(701.0 |
) |
|
(251.2 |
) |
Deferred
financing costs |
(6.3 |
) |
|
(0.7 |
) |
Proceeds from
exercised stock options |
6.0 |
|
|
78.8 |
|
Cash paid on
derivative contracts |
(30.5 |
) |
|
— |
|
Net cash
provided by (used in) financing activities |
504.3 |
|
|
(370.3 |
) |
|
|
|
|
Effect of
exchange rate changes on cash and cash equivalents |
(4.3 |
) |
|
(7.0 |
) |
Net increase
(decrease) in cash and cash equivalents |
867.1 |
|
|
(83.5 |
) |
Cash and cash
equivalents at beginning of period |
404.9 |
|
|
309.6 |
|
Cash and cash
equivalents at end of period |
$ |
1,272.0 |
|
|
$ |
226.1 |
|
Non-GAAP Financial Measures
Organic Sales
The Company defines "organic sales" as the increase or decrease
in net sales excluding: (1) net sales from acquired and divested
businesses recorded prior to the first anniversary of the
acquisition or divestiture, (2) net sales attributable to
discontinued product lines in both the current and prior year
periods, and (3) the impact of foreign currency translation, which
is calculated by comparing current-period sales to prior-period
sales, with both periods converted to the U.S. dollar rate at local
currency foreign exchange rates for each month of the prior
period.
The "organic sales" measure is not calculated in accordance with
accounting principles generally accepted in the United States ("US
GAAP"); therefore, this item represents a Non-GAAP measure. This
Non-GAAP measure may differ from those used by other companies and
should not be considered in isolation from, or as a substitute for,
measures of financial performance prepared in accordance with US
GAAP. Organic sales is an important internal measure for the
Company. The Company's senior management receives a monthly
analysis of operating results that includes organic sales. The
performance of the Company is measured on this metric along with
other performance metrics.
The Company discloses organic sales to allow investors to
evaluate the performance of the Company’s operations exclusive of
certain items that impact the comparability of results from period
to period and may not be indicative of past or future performance
of the normal operations of the Company. The Company believes that
this information is helpful in understanding underlying net sales
trends.
Adjusted Net Income (Loss) and Adjusted Earnings (Loss)
Per Diluted Common Share
In addition to reporting net income (loss) attributable to
Dentsply Sirona and earnings (loss) per diluted common share in
accordance with US GAAP, the Company provides adjusted net income
(loss) and adjusted earnings (loss) per diluted common share
(“adjusted EPS”) measures. The Company defines "adjusted net income
(loss)" as net income (loss) attributable to Dentsply Sirona
excluding certain items as noted below. Adjusted EPS is calculated
by dividing adjusted net income (loss) by diluted common shares
outstanding.
The adjusted net income (loss) attributable to Dentsply Sirona
consists of net income (loss) attributable to Dentsply Sirona
adjusted to exclude the following:
(1) Business combination related
costs and fair value adjustments. These adjustments include costs
related to integrating and consummating mergers and recently
acquired businesses, as well as costs, gains and losses related to
the disposal of businesses or significant product lines. In
addition, this category includes the roll off to the consolidated
statements of operations of fair value adjustments related to
business combinations, except for amortization expense noted below.
These items are irregular in timing and as such may not be
indicative of past and future performance of the Company and are
therefore excluded to allow investors to better understand
underlying operating trends.
(2) Restructuring program related
costs and other costs. These adjustments include costs related to
the implementation of restructuring initiatives as well as certain
other costs. These costs can include, but are not limited to,
severance costs, facility closure costs, lease and contract
termination costs, related professional service costs, duplicate
facility and labor costs associated with specific restructuring
initiatives, as well as legal settlements and impairments of
assets. These items are irregular in timing, amount and impact to
the Company’s financial performance. As such, these items may not
be indicative of past and future performance of the Company and are
therefore excluded for the purpose of understanding underlying
operating trends.
(3) Amortization of purchased
intangible assets. This adjustment excludes the periodic
amortization expense related to purchased intangible assets.
Amortization expense has been excluded from adjusted net income
attributable to Dentsply Sirona to allow investors to evaluate and
understand operating trends excluding these large non-cash
charges.
(4) Credit risk and fair value
adjustments. These adjustments include both the cost and income
impacts of adjustments in certain assets and liabilities including
the Company’s pension obligations, that are recorded through net
income which are due solely to the changes in fair value and credit
risk. These items can be variable and driven more by market
conditions than the Company’s operating performance. As such, these
items may not be indicative of past and future performance of the
Company and therefore are excluded for comparability purposes.
(5) Income tax related adjustments.
These adjustments include both income tax expenses and income tax
benefits that are representative of income tax adjustments mostly
related to prior periods, as well as the final settlement of income
tax audits, and discrete tax items resulting from the
implementation of restructuring initiatives and the vesting and
exercise of employee share-based compensation. These adjustments
are irregular in timing and amount and may significantly impact the
Company’s operating performance. As such, these items may not be
indicative of past and future performance of the Company and
therefore are excluded for comparability purposes.
The "adjusted net income (loss)" and "adjusted EPS" measures are
not calculated in accordance with accounting principles generally
accepted in the United States; therefore, these items represent
Non-GAAP measures. These Non-GAAP measures may differ from those
used by other companies and should not be considered in isolation
from, or as a substitute for, measures of financial performance
prepared in accordance with US GAAP. Income tax related adjustments
may include the impact to adjust the interim effective income tax
rate to the expected annual effective tax rate.
Both adjusted net income (loss) and adjusted EPS are important
internal measures for the Company. The Company's senior management
receives a monthly analysis of operating results that includes
adjusted net income (loss) and adjusted EPS. The performance of the
Company is measured on these metrics along with other performance
metrics.
The Company discloses adjusted net income (loss) and adjusted
EPS to allow investors to evaluate the performance of the Company’s
operations exclusive of certain items that impact the comparability
of results from period to period and may not be indicative of past
or future performance of the normal operations of the Company and
certain large non-cash charges related to intangible assets either
purchased or acquired through a business combination. The Company
believes that this information is helpful in understanding
underlying operating trends and cash flow generation.
Adjusted Operating Income (Loss) and Margin
In addition to reporting operating income (loss) in accordance
with US GAAP, the Company provides adjusted operating income (loss)
and margin. The Company defines "adjusted operating income (loss)"
as operating income (loss) in accordance with US GAAP excluding
certain items noted above which are excluded on a pre-tax basis to
arrive at adjusted operating income (loss), a Non-GAAP measure. The
adjusted operating margin is calculated by dividing adjusted
operating income (loss) by net sales.
The "adjusted operating income (loss)" and "adjusted operating
margin" measures are not calculated in accordance with accounting
principles generally accepted in the United States; therefore,
these items represent Non-GAAP measures. These Non-GAAP measures
may differ from those used by other companies and should not be
considered in isolation from, or as a substitute for, measures of
financial performance prepared in accordance with US GAAP.
Both adjusted operating income (loss) and adjusted operating
margin are important internal measures for the Company. The
Company's senior management receives a monthly analysis of
operating results that includes adjusted operating income (loss)
and margin. The performance of the Company is measured on these
metrics along with the adjusted net income (loss) and adjusted EPS
metrics noted above as well as other performance metrics.
The Company discloses adjusted operating income (loss) and
margin to allow investors to evaluate the performance of the
Company’s operations exclusive of certain items that impact the
comparability of results from period to period and may not be
indicative of past or future performance of the normal operations
of the Company and certain large non-cash charges related to
intangible assets either purchased or acquired through a business
combination. The Company believes that this information is helpful
in understanding underlying operating trends and cash flow
generation.
DENTSPLY SIRONA INC. AND
SUBSIDIARIES(In millions, except
percentages)(unaudited)
A reconciliation of reported net sales to organic sales by
geographic region is as follows:
|
|
Three Months Ended September 30, 2020 |
|
Q3 2020 Change |
|
Three Months Ended September 30, 2019 |
(in
millions, except percentages) |
|
U.S. |
Europe |
ROW |
Total |
|
U.S. |
Europe |
ROW |
Total |
|
U.S. |
Europe |
ROW |
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
$ |
318.7 |
|
$ |
350.8 |
|
$ |
225.3 |
|
$ |
894.8 |
|
|
(5.4 |
%) |
(2.9 |
%) |
(14.6 |
%) |
(7.0 |
%) |
|
$ |
337.0 |
|
$ |
361.4 |
|
$ |
263.7 |
|
$ |
962.1 |
|
Foreign exchange impact |
|
|
|
|
|
|
0.6 |
% |
3.9 |
% |
(1.3 |
%) |
1.3 |
% |
|
|
|
|
|
Acquisitions and
divestitures |
|
|
|
|
|
|
0.3 |
% |
(0.9 |
%) |
— |
% |
(0.2 |
%) |
|
|
|
|
|
Discontinued products |
|
|
|
|
|
|
0.1 |
% |
1.1 |
% |
1.2 |
% |
0.7 |
% |
|
|
|
|
|
Organic
sales |
|
|
|
|
|
|
(6.4 |
%) |
(7.0 |
%) |
(14.5 |
%) |
(8.8 |
%) |
|
|
|
|
|
A reconciliation of reported net sales to organic sales by
segment is as follows:
|
|
Three Months Ended September 30, 2020 |
|
Q3 2020 Change |
|
Three Months Ended September 30, 2019 |
(in
millions, except percentages) |
|
Technologies & Equipment |
Consumables |
Total |
|
Technologies & Equipment |
Consumables |
Total |
|
Technologies & Equipment |
Consumables |
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
$ |
503.8 |
|
$ |
391.0 |
|
$ |
894.8 |
|
|
(5.7 |
%) |
|
(8.6 |
%) |
|
(7.0 |
%) |
|
|
$ |
534.5 |
|
$ |
427.6 |
|
$ |
962.1 |
|
Foreign exchange impact |
|
|
|
|
|
1.9 |
% |
|
0.6 |
% |
|
1.3 |
% |
|
|
|
|
|
Acquisitions and
divestitures |
|
|
|
|
|
(0.4 |
%) |
|
— |
% |
|
(0.2 |
%) |
|
|
|
|
|
Discontinued products |
|
|
|
|
|
1.3 |
% |
|
0.1 |
% |
|
0.7 |
% |
|
|
|
|
|
Organic
sales |
|
|
|
|
|
(8.5 |
%) |
|
(9.3 |
%) |
|
(8.8 |
%) |
|
|
|
|
|
DENTSPLY SIRONA INC. AND
SUBSIDIARIES(In millions, except
percentages)(unaudited)
For the three months ended September 30, 2020, a
reconciliation of selected items as reported in the Condensed
Consolidated Statements of Operations to adjusted Non-GAAP items is
as follows:
|
|
|
|
|
|
|
|
|
|
|
GAAP |
|
|
|
|
|
|
|
ADJUSTED NON-GAAP |
(in millions, except per share amounts and percentages) |
Three Months Ended September 30, 2020 |
Amortization of Purchased Intangible Assets |
Restructuring Program Related Costs and Other
Costs |
Business Combination Related Costs and Fair Value
Adjustments |
Credit Risk and Fair Value Adjustments |
Tax Impact of Non-GAAP Adjustments |
Income Tax Related Adjustments |
Total Non-GAAP Adjustments |
Three Months Ended September 30, 2020 |
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
$ |
442.3 |
|
30.2 |
|
32.3 |
|
1.3 |
|
— |
|
— |
|
— |
|
$ |
63.8 |
|
$ |
506.1 |
|
% OF NET
SALES |
49.4 |
% |
|
|
|
|
|
|
|
56.6 |
% |
SELLING, GENERAL,
AND ADMINISTRATIVE EXPENSES |
341.9 |
|
(18.6 |
) |
(13.9 |
) |
(0.3 |
) |
— |
|
— |
|
— |
|
(32.8 |
) |
309.1 |
|
% OF NET
SALES |
38.2 |
% |
|
|
|
|
|
|
|
34.5 |
% |
RESTRUCTURING AND
OTHER COSTS |
18.7 |
|
— |
|
(18.7 |
) |
— |
|
— |
|
— |
|
— |
|
(18.7 |
) |
— |
|
OPERATING
INCOME |
81.7 |
|
48.8 |
|
64.9 |
|
1.6 |
|
— |
|
— |
|
— |
|
115.3 |
|
197.0 |
|
% OF NET
SALES |
9.1 |
% |
|
|
|
|
|
|
|
22.0 |
% |
OTHER INCOME AND
EXPENSE |
15.0 |
|
— |
|
— |
|
— |
|
(2.3 |
) |
— |
|
— |
|
(2.3 |
) |
12.7 |
|
INCOME BEFORE
INCOME TAXES |
66.7 |
|
48.8 |
|
64.9 |
|
1.6 |
|
2.3 |
|
— |
|
— |
|
117.6 |
|
184.3 |
|
PROVISION FOR
INCOME TAXES |
12.5 |
|
— |
|
— |
|
— |
|
— |
|
31.6 |
|
(6.7 |
) |
24.9 |
|
37.4 |
|
% OF PRE-TAX
INCOME |
18.7 |
% |
|
|
|
|
|
|
|
20.3 |
% |
LESS: NET INCOME
ATTRIBUTABLE TO NONCONTROLLING INTERESTS |
0.4 |
|
|
|
|
|
|
|
— |
|
0.4 |
|
NET INCOME
ATTRIBUTABLE TO DENTSPLY SIRONA |
$ |
53.8 |
|
|
|
|
|
|
|
$ |
92.7 |
|
$ |
146.5 |
|
% OF NET
SALES |
6.0 |
% |
|
|
|
|
|
|
|
16.4 |
% |
EARNINGS PER
SHARE - DILUTED |
$ |
0.25 |
|
|
|
|
|
|
|
$ |
0.42 |
|
$ |
0.67 |
|
|
|
|
|
|
|
|
|
|
|
For the three months ended September 30, 2020, the
following table presents the details of the "Restructuring program
related costs and other costs" column in the above table and the
affected line item in the Consolidated Statements of
Operations:
(in millions) |
|
Asset impairments |
|
Costs related to restructuring plans |
|
Professional services costs |
|
Incentive compensation |
|
Other |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of products
sold |
|
$ |
— |
|
|
$ |
32.3 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
32.3 |
|
Selling, general,
and administrative expenses |
|
— |
|
|
1.3 |
|
|
12.0 |
|
|
0.6 |
|
|
— |
|
|
13.9 |
|
Restructuring and
other costs |
|
2.2 |
|
|
15.7 |
|
|
— |
|
|
— |
|
|
0.8 |
|
|
18.7 |
|
Total |
|
$ |
2.2 |
|
|
$ |
49.3 |
|
|
$ |
12.0 |
|
|
$ |
0.6 |
|
|
$ |
0.8 |
|
|
$ |
64.9 |
|
DENTSPLY SIRONA INC. AND
SUBSIDIARIES(In millions, except
percentages)(unaudited)
For the three months ended September 30, 2019, a
reconciliation of selected items as reported in the Condensed
Consolidated Statements of Operations to adjusted Non-GAAP items is
as follows:
|
|
|
|
|
|
|
|
|
|
|
GAAP |
|
|
|
|
|
|
|
ADJUSTED NON-GAAP |
(in millions, except per share amounts and percentages) |
Three Months Ended September 30, 2019 |
Amortization of Purchased Intangible Assets |
Restructuring Program Related Costs and Other
Costs |
Business Combination Related Costs and Fair Value
Adjustments |
Credit Risk and Fair Value Adjustments |
Tax Impact of Non-GAAP Adjustments |
Income Tax Related Adjustments |
Total Non-GAAP Adjustments |
Three Months Ended September 30, 2019 |
|
|
|
|
|
|
|
|
|
|
GROSS PROFIT |
$ |
514.0 |
|
28.8 |
|
3.6 |
|
1.5 |
|
— |
|
— |
|
— |
|
$ |
33.9 |
|
$ |
547.9 |
|
% OF NET
SALES |
53.4 |
% |
|
|
|
|
|
|
|
56.9 |
% |
SELLING, GENERAL,
AND ADMINISTRATIVE EXPENSES |
399.3 |
|
(18.6 |
) |
(4.8 |
) |
(0.3 |
) |
— |
|
— |
|
— |
|
(23.7 |
) |
375.6 |
|
% OF NET
SALES |
41.5 |
% |
|
|
|
|
|
|
|
39.0 |
% |
RESTRUCTURING AND
OTHER COSTS |
5.2 |
|
— |
|
(5.2 |
) |
— |
|
— |
|
— |
|
— |
|
(5.2 |
) |
— |
|
OPERATING
INCOME |
109.5 |
|
47.4 |
|
13.6 |
|
1.8 |
|
— |
|
— |
|
— |
|
62.8 |
|
172.3 |
|
% OF NET
SALES |
11.4 |
% |
|
|
|
|
|
|
|
17.9 |
% |
OTHER INCOME AND
EXPENSE |
3.0 |
|
— |
|
0.4 |
|
— |
|
(1.6 |
) |
— |
|
— |
|
(1.2 |
) |
1.8 |
|
INCOME BEFORE
INCOME TAXES |
106.5 |
|
47.4 |
|
13.2 |
|
1.8 |
|
1.6 |
|
— |
|
— |
|
64.0 |
|
170.5 |
|
PROVISION FOR
INCOME TAXES |
21.5 |
|
— |
|
— |
|
— |
|
— |
|
16.5 |
|
4.2 |
|
20.7 |
|
42.2 |
|
% OF PRE-TAX
INCOME |
20.2 |
% |
|
|
|
|
|
|
|
24.8 |
% |
NET INCOME
ATTRIBUTABLE TO DENTSPLY SIRONA |
$ |
85.0 |
|
|
|
|
|
|
|
$ |
43.3 |
|
$ |
128.3 |
|
% OF NET
SALES |
8.8 |
% |
|
|
|
|
|
|
|
13.3 |
% |
EARNINGS PER
SHARE - DILUTED |
$ |
0.38 |
|
|
|
|
|
|
|
$ |
0.19 |
|
$ |
0.57 |
|
For the three months ended September 30, 2019, the
following table presents the details of the "Restructuring program
related costs and other costs" column in the above table and the
affected line item in the Consolidated Statements of
Operations:
(in millions) |
|
Asset impairments |
|
Sale or discontinuation of non-strategic business or product
lines |
|
Costs related to restructuring plans |
|
Professional services costs |
|
Incentive Compensation |
|
Other |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of products
sold |
|
$ |
— |
|
|
$ |
3.0 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
0.6 |
|
|
$ |
3.6 |
|
Selling, general,
and administrative expenses |
|
— |
|
|
(0.8 |
) |
|
— |
|
|
5.2 |
|
|
0.7 |
|
|
(0.3 |
) |
|
4.8 |
|
Restructuring and
other costs |
|
3.8 |
|
|
— |
|
|
(1.9 |
) |
|
— |
|
|
— |
|
|
3.3 |
|
|
5.2 |
|
Interest expense,
Interest income, and Other expense (income), net |
|
— |
|
|
(0.4 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.4 |
) |
Total |
|
$ |
3.8 |
|
|
$ |
1.8 |
|
|
$ |
(1.9 |
) |
|
$ |
5.2 |
|
|
$ |
0.7 |
|
|
$ |
3.6 |
|
|
$ |
13.2 |
|
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