Business Context and Reporting Period
Company: Becton, Dickinson and Company (BD)
Filing Type: Form 8-K (Current Report)
Date of Report: July 24, 2008
Reporting Period: Fiscal quarter ended June 30, 2008 (Third Quarter 2008)
This filing announces the issuance of a press release containing financial results for the third quarter of fiscal year 2008. The document primarily serves to disclose the use of non-GAAP financial measures to supplement GAAP results.
Key Financial Metrics
The filing text does not provide specific numerical values for revenue, profit, cash flow, margins, debt, or liquidity for the reported period. These figures are contained within the referenced press release (Exhibit 99.1), which is not included in the provided text.
The filing details the following non-GAAP adjustments used by management to evaluate performance:
- Revenues: Presented at constant foreign exchange rates to remove currency fluctuation impacts.
- Operating Income: Adjusted to exclude in-process research and development (R&D) charges related to the acquisitions of Plasso Technology, Ltd. and TriPath Imaging, Inc.
- Effective Tax Rate: Adjusted to exclude the impact of non-tax-deductible in-process R&D charges from the aforementioned acquisitions.
- Income from Continuing Operations: Adjusted to exclude in-process R&D charges.
- Earnings Per Share (EPS): Adjusted to exclude in-process R&D charges.
Material Changes and Unusual Items
The filing identifies specific unusual items that impacted prior period comparability (specifically fiscal year 2007) and are excluded from the company's non-GAAP measures:
- Acquisition Charges: In-process R&D charges associated with the acquisitions of Plasso Technology, Ltd. and TriPath Imaging, Inc.
- Impact: These charges reduced reported operating income, increased the effective tax rate (as they were not tax-deductible), and lowered reported income from continuing operations and EPS for the periods in which they occurred.
Management considers these charges outside of ordinary operations and excludes them to provide a clearer view of underlying operational performance.
Guidance, Outlook, and Management Commentary
Management Commentary: Management utilizes these non-GAAP measures for internal evaluation, budget planning, and to facilitate period-to-period comparisons. They believe these adjusted measures are more indicative of BD's underlying performance than GAAP results alone.
Limitations and Risks: The filing explicitly states that non-GAAP results should not be considered in isolation or as a substitute for GAAP results. Management acknowledges that excluded items may have a material impact on net income, EPS, and cash flows calculated under GAAP. Additionally, these non-GAAP measures may differ from similar measures used by other companies.
Guidance: The provided text does not contain specific forward-looking guidance or outlook figures for future periods.
Investor Verification Checklist
- Verify the specific GAAP and non-GAAP revenue, operating income, and EPS figures in the press release (Exhibit 99.1) referenced in this filing.
- Confirm the exact dollar amounts of the in-process R&D charges related to the Plasso and TriPath acquisitions to understand the magnitude of the adjustments.
- Review the reconciliation between GAAP and non-GAAP measures to assess the impact of foreign exchange rates on reported revenue growth.
- Check for any updated forward-looking statements or guidance in the full press release not captured in this summary.