8-K

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)          November 6, 2017

HENRY SCHEIN, INC.

(Exact name of registrant as specified in its charter)

DELAWARE	0-27078	11-3136595
(State or other jurisdiction	(Commission File	(IRS Employer
of incorporation)	Number)	Identification No.)

135 DURYEA ROAD, MELVILLE, NEW YORK	11747
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code          (631) 843-5500

NOT APPLICABLE

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company □

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. □

Item 2.02.  Results of Operations and Financial Condition.

On November 6, 2017, Henry Schein, Inc. issued a press release reporting the financial results for the three and nine months ended September 30, 2017.  The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information in this Item 2.02 and the press release attached as Exhibit 99.1 are considered furnished to the Securities and Exchange Commission and are not deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

Item 9.01.  Financial Statements and Exhibits

(a)  Not applicable.

(b)  Not applicable.

(c)  Not applicable.

(d)  Exhibit 99.1 – Press Release dated November 6, 2017.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	HENRY SCHEIN, INC.
By:	/s/ Steven Paladino
	Steven Paladino
	Executive Vice President and
	Chief Financial Officer
	(principal financial and accounting
	officer)

November 6, 2017

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release dated November 6, 2017.

EX-99.1

 

FOR IMMEDIATE RELEASE

HENRY SCHEIN REPORTS RECORD THIRD QUARTER FINANCIAL RESULTS

Adjusts 2017 full year diluted EPS guidance range, introduces 2018 diluted EPS guidance

MELVILLE, N.Y., November 6, 2017 – Henry Schein, Inc. (Nasdaq: HSIC), the world’s largest provider of health care products and services to office-based dental, animal health, and medical practitioners, today reported record third quarter financial results. All per share figures in this news release reflect the 2-for-1 common stock split that Henry Schein completed during the third quarter of 2017.

Net sales for the quarter ended September 30, 2017 were $3.2 billion, an increase of 10.3% compared with the third quarter of 2016. This consisted of 8.8% growth in local currencies and a 1.5% increase related to foreign currency exchange. In local currencies, internal sales growth was 4.8% and acquisition growth was 4.0% (see Exhibit A for details of sales growth).

Net income attributable to Henry Schein, Inc. for the third quarter of 2017 was $138.0 million, or $0.87 per diluted share. Compared with the GAAP results for the third quarter of 2016, this represents growth of 3.2% and 6.1%, respectively. Compared with the non-GAAP  results for the third quarter of 2016, this represents growth of 0.2% and 3.6%, respectively. Note that third quarter 2016 non-GAAP results exclude restructuring costs of $5.4 million pretax or $0.02 per diluted share (see Exhibit B for reconciliation of GAAP net income and EPS to non-GAAP  net income and EPS).

“Solid overall sales results for the quarter reflect continued success with our comprehensive offering of products and value-added services that drive internal growth, complemented by strategic acquisitions,” said Stanley M. Bergman, Chairman of the Board and Chief Executive Officer of Henry Schein. “Third quarter sales growth was negatively impacted by approximately 30 basis points due to the recent hurricanes in the U.S. as well as a difficult comparable in dental equipment sales as we reported double-digit sales growth in the third quarter of 2016 associated with a successful sales promotion.”

Henry Schein is adjusting its 2017 full year EPS guidance range to reflect growth of approximately 12% on a GAAP basis, versus the comparable 2016 results. This reflects growth of 8% to 9% on a non-GAAP basis, which excludes litigation settlement expenses and a fourth quarter loss associated with Henry Schein’s divestiture of its equity ownership in E4D Technologies, versus the comparable 2016 results. The Company also is introducing 2018 EPS guidance that reflects growth of 11% to 14% compared with the midpoint of the Company’s 2017 GAAP guidance range and 7% to 10% compared with the midpoint of the Company’s 2017 non-GAAP guidance range.

“During 2018 and beyond, we expect to continue to make progress with our focus on increasing sales of higher-margin products, as well as improving operating efficiencies to achieve long-term EPS growth,” Mr. Bergman added.

Dental sales of $1.5 billion increased 11.1%, consisting of 9.1% growth in local currencies and a 2.0% increase related to foreign currency exchange. In local currencies, internal sales growth was 1.6% and acquisition growth was 7.5%. The 1.6% internal growth in local currencies included 0.8% growth in North America and 3.2% growth internationally.

“In North America, dental consumable merchandise internal sales growth in local currencies was 1.3%, which was negatively impacted by approximately 140 basis points due to recent hurricanes and the loss of a previously disclosed large DSO contract. We continue to expect stable market growth for dental consumable merchandise,” commented Mr. Bergman. “North America dental equipment internal sales growth in local currencies declined by 0.7%, which was negatively impacted by approximately 170 basis points due to recent hurricanes and the loss of the previously disclosed DSO contract, and reflects a difficult prior-year comparison, when we achieved 13.3% growth. We are fully committed to offering a broad set of solutions to advance digital dentistry, and are pleased with the initial reception from customers in North America following the addition of the full line of Dentsply Sirona dental equipment.”

Henry Schein now has access to a comprehensive offering of digital prosthetic equipment solutions and therefore, recently divested its equity investment in E4D Technologies. This is consistent with the Company’s strategy to offer a comprehensive selection of dental equipment solutions to customers through an open-architecture market approach. The Company also now has broad access to digital prosthetic materials and as a result, recently divested its ownership position in a company that produces materials used for manufacturing lab restorations and distributes dental products in China. Henry Schein believes it continues to be well-positioned in the global dental lab market, providing solutions for digital restorations that are outsourced to lab facilities. In addition to Dentsply Sirona, Henry Schein will continue to represent the complete lines from other key suppliers, including 3M, 3Shape, A-dec, Danaher, Ivoclar, Midmark, Planmeca, and many others.

Mr. Bergman continued, “In local currencies, international dental consumable merchandise internal sales growth was 3.4% and international dental equipment internal sales growth was 2.6%.”

Animal Health sales of $882.6 million increased 11.7%, consisting of 9.9% growth in local currencies and a 1.8% increase related to foreign currency exchange. In local currencies, internal sales growth was 8.0% and acquisition growth was 1.9%. The 8.0% internal growth in local currencies included 9.0% growth in North America, which was negatively impacted by approximately 50 basis points due to recent hurricanes, and 6.9% growth internationally.

“Global Animal Health internal sales growth in local currencies reflects strong execution across our global business,” commented Mr. Bergman. “We believe these gains are due to the breadth of our value-added solutions offering, including an enhanced product portfolio featuring software, diagnostic equipment, and surgical instruments.” 

Medical sales of $690.8 million increased 8.0%, consisting of 7.9% growth in local currencies, and a 0.1% increase related to foreign currency exchange. In local currencies, internal sales growth was 7.8%, which was negatively impacted by approximately 25 basis points due to recent hurricanes, and acquisition growth was 0.1%.

“The large group practice segment of the market contributed to solid sales growth in our Medical group during the quarter. This success reflects our commitment to solutions that help customers provide quality care and increase value in the delivery of health care services,” remarked Mr. Bergman.

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Technology and Value-Added Services sales of $109.0 million increased 4.1%, including 3.7% growth in local currencies and a 0.4% increase related to foreign currency exchange. In local currencies, internal sales growth was 3.0% and acquisition growth was 0.7%.

“In North America, Technology and Value-Added Services internal sales growth of 2.0% in local currencies was impacted by lower dental software sales and financial services revenue, which is primarily related to lower dental equipment sales versus the prior year third quarter,” said Mr. Bergman. “In international markets, we delivered solid internal sales growth in local currencies of 8.7%, highlighted by strong veterinary software revenue.”  

Stock Repurchase Plan

The Company announced that during the third quarter it spent approximately $125.0 million to repurchase approximately 1.4 million shares of its common stock. The impact of the repurchase of shares on third quarter 2017 diluted EPS was immaterial. At the close of the third quarter, Henry Schein had approximately $425.0 million authorized for future repurchases of its common stock.

Year-to-Date Results

Net sales for the first nine months of 2017 were $9.1 billion, an increase of 8.2% compared with the first nine months of 2016. This consisted of 8.4% growth in local currencies and a decline of 0.2% related to foreign currency exchange.  In local currencies, internal sales growth was 5.0% and acquisition growth was 3.4% (see Exhibit A for details of sales growth). 

Net income attributable to Henry Schein, Inc. for the first nine months of 2017 was $414.8 million, or $2.61 per diluted share on a GAAP basis, an increase of 12.9% and 17.0%, respectively, compared with the first nine months of 2016. Excluding the second quarter 2017 litigation settlement expense of $5.3 million pretax or $0.02 per diluted share, non-GAAP net income attributable to Henry Schein, Inc. for the first nine months of 2017 was $418.0 million or $2.63 per diluted share, an increase of 7.2% and 11.0%, respectively, compared with non-GAAP results for the first nine months of 2016, which excluded restructuring costs(see Exhibit B for reconciliation of GAAP net income and EPS to non-GAAP  net income and EPS).

2017 EPS Guidance

Henry Schein today adjusted its 2017 full year diluted EPS guidance range and now expects the following:

·2017 GAAP diluted EPS attributable to Henry Schein, Inc., which includes litigation settlement expenses, is expected to be $3.46 to $3.48. This guidance reflects growth of approximately 12% compared with 2016 GAAP diluted EPS of $3.10. The prior 2017 GAAP diluted EPS guidance range was $3.57 to $3.63.

·2017 non-GAAP diluted EPS, which excludes litigation settlement expenses and a fourth quarter loss associated with Henry Schein’s divestiture of its equity ownership in E4D Technologies, is expected to be $3.59 to $3.61. This guidance reflects growth of 8% to 9% compared with 2016 non-GAAP diluted EPS of $3.31, which excluded restructuring charges of $0.21 per diluted share. The prior 2017 non-GAAP diluted EPS guidance range was $3.59 to $3.65.

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·The Company notes that fiscal year 2017 includes one less week than fiscal year 2016.

·Guidance for 2017 GAAP and non-GAAP diluted EPS is for current continuing operations as well as completed or previously announced acquisitions, and does not include the impact of potential future acquisitions, if any. Guidance also assumes foreign exchange rates that are generally consistent with current levels.

2018 EPS Guidance

Henry Schein today introduced 2018 financial guidance, as follows:

·2018 diluted EPS attributable to Henry Schein, Inc. is expected to be $3.85 to $3.96. This guidance reflects growth of 11% to 14% compared with the midpoint of the Company’s 2017 GAAP guidance range and growth of 7% to 10% compared with the midpoint of the Company’s 2017 non-GAAP guidance range.

·Guidance for 2018 diluted EPS attributable to Henry Schein, Inc. is for current continuing operations as well as completed or previously announced acquisitions, and does not include the impact of potential future acquisitions, if any. Guidance also assumes foreign exchange rates that are generally consistent with current levels.

Third Quarter 2017 Conference Call Webcast

The Company will hold a conference call to discuss third quarter 2017 financial results today, beginning at 10:00 a.m. Eastern time. Individual investors are invited to listen to the conference call through Henry Schein’s website at www.henryschein.com. In addition, a replay will be available beginning shortly after the call has ended.

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About Henry Schein, Inc.

Henry Schein, Inc. (Nasdaq: HSIC) is the world’s largest provider of health care products and services to office-based dental, animal health,  and medical practitioners. The Company also serves dental laboratories, government and institutional health care clinics, and other alternate care sites. A Fortune 500® Company and a member of the S&P 500® and the Nasdaq 100® indexes, Henry Schein employs more than 22,000 Team Schein Members and serves more than 1 million customers.

The Company offers a comprehensive selection of products and services, including value-added solutions for operating efficient practices and delivering high-quality care. Henry Schein operates through a centralized and automated distribution network, with a selection of more than 120,000 branded products and Henry Schein private-brand products in stock, as well as more than 180,000 additional products available as special-order items. The Company also offers its customers exclusive, innovative technology solutions, including practice management software and e-commerce solutions, as well as a broad range of financial services.                                         

Headquartered in Melville, N.Y., Henry Schein has operations or affiliates in 33 countries. The Company’s sales reached a record $11.6 billion in 2016, and have grown at a compound annual rate of approximately 15% since Henry Schein became a public company in 1995. For more information, visit Henry Schein at www.henryschein.com, Facebook.com/HenryScheinand @HenrySchein on Twitter. 

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Cautionary Note Regarding Forward-Looking Statements and Use of Non-GAAP Financial Information

In accordance with the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995, we provide the following cautionary remarks regarding important factors that, among others, could cause future results to differ materially from the forward-looking statements, expectations and assumptions expressed or implied herein.  All forward-looking statements made by us are subject to risks and uncertainties and are not guarantees of future performance.  These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance and achievements or industry results to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.  These statements are identified by the use of such terms as "may," "could," "expect," "intend," "believe," "plan," "estimate," "forecast," "project," "anticipate" or other comparable terms.  A full discussion of our operations and financial condition, including factors that may affect our business and future prospects, is contained in documents we have filed with the United States Securities and Exchange Commission, or SEC, and will be contained in all subsequent periodic filings we make with the SEC. These documents identify in detail important risk factors that could cause our actual performance to differ materially from current expectations.

Risk factors and uncertainties that could cause actual results to differ materially from current and historical results include, but are not limited to: effects of a highly competitive and consolidating market; our dependence on third parties for the manufacture and supply of our products; our dependence upon sales personnel, customers, suppliers and manufacturers; our dependence on our senior management; fluctuations in quarterly earnings; risks from expansion of customer purchasing power and multi-tiered costing structures; increases in shipping costs for our products or other service issues with our third-party shippers; general global macro-economic conditions; risks associated with currency fluctuations; risks associated with political and economic uncertainty; disruptions in financial markets; volatility of the market price of our common stock; changes in the health care industry; implementation of health care laws; failure to comply with regulatory requirements and data privacy laws; risks associated with our global operations; transitional challenges associated with acquisitions and joint ventures, including the failure to achieve anticipated synergies; financial risks associated with acquisitions and joint ventures; litigation risks; the dependence on our continued product development, technical support and successful marketing in the technology segment; increased competition by third party online commerce sites; risks from disruption to our information systems; cyberattacks or other privacy or data security breaches; certain provisions in our governing documents that may discourage third-party acquisitions of us; and changes in tax legislation. The order in which these factors appear should not be construed to indicate their relative importance or priority. 

We caution that these factors may not be exhaustive and that many of these factors are beyond our ability to control or predict.  Accordingly, any forward-looking statements contained herein should not be relied upon as a prediction of actual results.  We undertake no duty and have no obligation to update forward-looking statements.

Included within the press release are non-GAAP financial measures that supplement the Company’s Consolidated Statements of Income prepared under generally accepted accounting principles (GAAP).  These non-GAAP financial measures adjust the Company’s actual results prepared under GAAP to exclude certain items.  In the schedules attached to this press release, the non-GAAP measures have been reconciled to and should be considered together with the Consolidated Statements of Income.  Management believes that non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance and allow for greater transparency with respect to key metrics used by management in operating our business. These non-GAAP financial measures are presented solely for informational and comparative purposes and should not be regarded as a replacement for corresponding, similarly captioned, GAAP measures.

CONTACTS:        Investors 

Steven Paladino

Executive Vice President and Chief Financial Officer

steven.paladino@henryschein.com

(631) 843-5500

Carolynne Borders

Vice President, Investor Relations

carolynne.borders@henryschein.com

(631) 390-8105

Media

Ann Marie Gothard

Vice President, Corporate Media Relations

annmarie.gothard@henryschein.com

(631) 390-8169

(TABLES TO FOLLOW)

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HENRY SCHEIN, INC.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
					Three Months Ended				Nine Months Ended
				September 30,		September 24,		September 30,		September 24,
				2017		2016		2017		2016
Net sales				$	3,161,083	$	2,865,148	$	9,143,489	$	8,450,734
Cost of sales					2,325,029		2,077,473		6,645,342		6,083,748
		Gross profit			836,054		787,675		2,498,147		2,366,986
Operating expenses:
	Selling, general and administrative				622,506		581,584		1,879,969		1,779,583
	Restructuring costs				-		5,370		-		29,811
		Operating income			213,548		200,721		618,178		557,592
Other income (expense):
	Interest income				4,793		3,141		13,204		10,045
	Interest expense				(13,428)		(7,488)		(37,056)		(21,982)
	Other, net				(194)		(199)		489		3,206
		Income before taxes and equity in earnings
			of affiliates		204,719		196,175		594,815		548,861
Income taxes					(59,340)		(56,601)		(156,276)		(159,099)
Equity in earnings of affiliates					5,569		5,717		12,244		13,160
Net income					150,948		145,291		450,783		402,922
	Less: Net income attributable to noncontrolling interests				(12,917)		(11,578)		(35,949)		(35,360)
Net income attributable to Henry Schein, Inc.				$	138,031	$	133,713	$	414,834	$	367,562
Earnings per share attributable to Henry Schein, Inc.:
	Basic			$	0.88	$	0.83	$	2.64	$	2.26
	Diluted			$	0.87	$	0.82	$	2.61	$	2.23
Weighted-average common shares outstanding:
	Basic				156,914		161,791		157,386		162,600
	Diluted				158,271		163,710		158,866		164,635

Note: Certain prior quarter amounts have been reclassified to conform to the current period presentation.

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HENRY SCHEIN, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
				September 30,		December 31,
				2017		2016
				(unaudited)
ASSETS
Current assets:
	Cash and cash equivalents			$	79,879	$	62,381
	Accounts receivable, net of reserves of $96,953 and $90,329				1,544,582		1,254,139
	Inventories, net				1,692,256		1,635,750
	Prepaid expenses and other				465,812		360,510
			Total current assets		3,782,529		3,312,780
Property and equipment, net					361,708		333,906
Goodwill					2,224,657		2,019,740
Other intangibles, net					666,997		621,180
Investments and other					450,770		442,790
			Total assets	$	7,486,661	$	6,730,396
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
	Accounts payable			$	1,029,138	$	977,249
	Bank credit lines				631,865		437,476
	Current maturities of long-term debt				17,247		65,923
	Accrued expenses:
		Payroll and related			251,849		266,463
		Taxes			148,627		151,750
		Other			358,421		391,785
			Total current liabilities		2,437,147		2,290,646
Long-term debt					907,592		715,457
Deferred income taxes					91,786		51,589
Other liabilities					292,179		264,264
			Total liabilities		3,728,704		3,321,956
Redeemable noncontrolling interests					737,747		607,636
Commitments and contingencies
Stockholders' equity:
	Preferred stock, $.01 par value, 1,000,000 shares authorized,
		none outstanding			-		-
	Common stock, $.01 par value, 240,000,000 shares authorized,
		156,952,738 outstanding on September 30, 2017 and
		158,805,010 outstanding on December 31, 2016			1,570		1,588
	Additional paid-in capital				-		126,742
	Retained earnings				3,164,541		2,981,777
	Accumulated other comprehensive loss				(154,472)		(317,041)
		Total Henry Schein, Inc. stockholders' equity			3,011,639		2,793,066
	Noncontrolling interests				8,571		7,738
			Total stockholders' equity		3,020,210		2,800,804
		Total liabilities, redeemable noncontrolling interests and stockholders' equity		$	7,486,661	$	6,730,396

Note: Certain prior period amounts have been reclassified to conform to the current period presentation.

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HENRY SCHEIN, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
					Three Months Ended				Nine Months Ended
					September 30,		September 24,		September 30,		September 24,
					2017		2016		2017		2016
Cash flows from operating activities:
	Net income				$	150,948	$	145,291	$	450,783	$	402,922
	Adjustments to reconcile net income to net cash
		provided by operating activities:
			Depreciation and amortization			48,740		42,431		141,278		125,829
			Stock-based compensation expense			12,632		16,171		31,987		43,627
			Provision for losses on trade and other
				accounts receivable		2,932		946		6,981		1,736
			Provision for (benefit from) deferred income taxes			4,185		(8,767)		8,600		(13,425)
			Equity in earnings of affiliates			(5,569)		(5,717)		(12,244)		(13,160)
			Distributions from equity affiliates			7,148		5,767		16,826		12,104
			Changes in unrecognized tax benefits			974		2,348		(6,653)		4,799
			Other			1,016		5,484		6,031		7,845
			Changes in operating assets and liabilities,
			net of acquisitions:
				Accounts receivable		(106,301)		(74,884)		(229,239)		(131,586)
				Inventories		(88,464)		14,118		27,336		48,513
				Other current assets		(13,134)		3,095		(70,833)		(35,781)
				Accounts payable and accrued expenses		116,255		32,346		(63,352)		(75,355)
Net cash provided by operating activities						131,362		178,629		307,501		378,068
Cash flows from investing activities:
	Purchases of fixed assets					(18,350)		(18,345)		(55,315)		(44,525)
	Payments for equity investments and business
		acquisitions, net of cash acquired				(109,200)		(34,102)		(258,786)		(126,543)
	Other					(1,822)		(7,001)		(6,694)		(8,766)
Net cash used in investing activities						(129,372)		(59,448)		(320,795)		(179,834)
Cash flows from financing activities:
	Proceeds from (repayments of) bank borrowings					54,288		94,205		193,550		(3,274)
	Proceeds from issuance of long-term debt					100,440		16,000		200,440		260,000
	Principal payments for long-term debt					(347)		(1,372)		(59,531)		(9,293)
	Debt issuance costs					(638)		-		(1,771)		(233)
	Proceeds from issuance of stock upon exercise
		of stock options				240		695		4,941		9,754
	Payments for repurchases of common stock					(124,999)		(192,992)		(225,005)		(350,001)
	Payments for taxes related to shares withheld for employee taxes					(307)		(548)		(44,721)		(27,115)
	Excess tax benefits related to stock-based
		compensation				-		(463)		-		(463)
	Distributions to noncontrolling shareholders					(4,320)		(6,206)		(23,921)		(26,366)
	Acquisitions of noncontrolling interests in subsidiaries					(23,763)		(15,633)		(27,914)		(51,265)
Net cash provided by (used in) financing activities						594		(106,314)		16,068		(198,256)
Effect of exchange rate changes on cash and
	cash equivalents					2,641		(235)		14,724		4,128
Net change in cash and cash equivalents						5,225		12,632		17,498		4,106
Cash and cash equivalents, beginning of period						74,654		63,560		62,381		72,086
Cash and cash equivalents, end of period					$	79,879	$	76,192	$	79,879	$	76,192
Note: Certain prior period amounts have been reclassified to conform to the current period presentation.

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Exhibit A - QTD Sales
Henry Schein, Inc.
2017 Third Quarter
Sales Summary
(in thousands)
(unaudited)
Q3 2017 over Q3 2016
Global	Q3 2017		Q3 2016		Total Sales Growth	Foreign Exchange Growth	Local Currency Growth	Acquisition Growth	Local Internal Growth
Dental	$	1,478,730	$	1,330,525	11.1%	2.0%	9.1%	7.5%	1.6%
Animal Health		882,580		790,279	11.7%	1.8%	9.9%	1.9%	8.0%
Medical		690,761		639,648	8.0%	0.1%	7.9%	0.1%	7.8%
Total Health Care Distribution		3,052,071		2,760,452	10.6%	1.6%	9.0%	4.1%	4.9%
Technology and value-added services		109,012		104,696	4.1%	0.4%	3.7%	0.7%	3.0%
Total Global	$	3,161,083	$	2,865,148	10.3%	1.5%	8.8%	4.0%	4.8%
North America	Q3 2017		Q3 2016		Total Sales Growth	Foreign Exchange Growth	Local Currency Growth	Acquisition Growth	Local Internal Growth
Dental	$	906,878	$	879,612	3.1%	0.4%	2.7%	1.9%	0.8%
Animal Health		448,376		403,901	11.0%	0.0%	11.0%	2.0%	9.0%
Medical		672,425		622,903	8.0%	0.0%	8.0%	0.1%	7.9%
Total Health Care Distribution		2,027,679		1,906,416	6.4%	0.2%	6.2%	1.3%	4.9%
Technology and value-added services		89,881		88,066	2.1%	0.1%	2.0%	0.0%	2.0%
Total North America	$	2,117,560	$	1,994,482	6.2%	0.2%	6.0%	1.3%	4.7%
International	Q3 2017		Q3 2016		Total Sales Growth	Foreign Exchange Growth	Local Currency Growth	Acquisition Growth	Local Internal Growth
Dental	$	571,852	$	450,913	26.8%	5.3%	21.5%	18.3%	3.2%
Animal Health		434,204		386,378	12.4%	3.6%	8.8%	1.9%	6.9%
Medical		18,336		16,745	9.5%	5.0%	4.5%	0.0%	4.5%
Total Health Care Distribution		1,024,392		854,036	19.9%	4.5%	15.4%	10.5%	4.9%
Technology and value-added services		19,131		16,630	15.0%	1.8%	13.2%	4.5%	8.7%
Total International	$	1,043,523	$	870,666	19.9%	4.5%	15.4%	10.4%	5.0%

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Exhibit A - YTD Sales
Henry Schein, Inc.
2017 Third Quarter Year to Date
Sales Summary
(in thousands)
(unaudited)
Q3 2017 YTD over Q3 2016 YTD
Global	Q3 2017 YTD		Q3 2016 YTD		Total Sales Growth	Foreign Exchange Growth	Local Currency Growth	Acquisition Growth	Local Internal Growth
Dental	$	4,372,055	$	4,005,468	9.2%	0.3%	8.9%	6.3%	2.6%
Animal Health		2,586,850		2,415,290	7.1%	-1.1%	8.2%	1.3%	6.9%
Medical		1,861,074		1,716,590	8.4%	-0.1%	8.5%	0.1%	8.4%
Total Health Care Distribution		8,819,979		8,137,348	8.4%	-0.2%	8.6%	3.5%	5.1%
Technology and value-added services		323,510		313,386	3.2%	-0.8%	4.0%	0.4%	3.6%
Total Global	$	9,143,489	$	8,450,734	8.2%	-0.2%	8.4%	3.4%	5.0%
North America	Q3 2017 YTD		Q3 2016 YTD		Total Sales Growth	Foreign Exchange Growth	Local Currency Growth	Acquisition Growth	Local Internal Growth
Dental	$	2,669,805	$	2,580,034	3.5%	0.1%	3.4%	1.6%	1.8%
Animal Health		1,344,221		1,249,146	7.6%	0.0%	7.6%	0.8%	6.8%
Medical		1,806,196		1,662,676	8.6%	0.0%	8.6%	0.0%	8.6%
Total Health Care Distribution		5,820,222		5,491,856	6.0%	0.1%	5.9%	0.9%	5.0%
Technology and value-added services		269,226		264,191	1.9%	0.0%	1.9%	0.0%	1.9%
Total North America	$	6,089,448	$	5,756,047	5.8%	0.1%	5.7%	0.9%	4.8%
International	Q3 2017 YTD		Q3 2016 YTD		Total Sales Growth	Foreign Exchange Growth	Local Currency Growth	Acquisition Growth	Local Internal Growth
Dental	$	1,702,250	$	1,425,434	19.4%	0.5%	18.9%	15.0%	3.9%
Animal Health		1,242,629		1,166,144	6.6%	-2.2%	8.8%	1.7%	7.1%
Medical		54,878		53,914	1.8%	-1.3%	3.1%	0.0%	3.1%
Total Health Care Distribution		2,999,757		2,645,492	13.4%	-0.7%	14.1%	8.8%	5.3%
Technology and value-added services		54,284		49,195	10.3%	-5.0%	15.3%	2.6%	12.7%
Total International	$	3,054,041	$	2,694,687	13.3%	-0.8%	14.1%	8.7%	5.4%

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Exhibit B
Henry Schein, Inc.
2017 Third Quarter and YTD
Reconciliation of GAAP results of net income attributable to Henry Schein, Inc. to
non-GAAP results of net income attributable to Henry Schein, Inc.
(in thousands, except per share data)
(unaudited)
		Third Quarter						Year-to-Date
					%						%
		2017		2016	Growth			2017		2016	Growth
Net Income attributable to Henry Schein, Inc.	$	138,031	$	133,713	3.2	%	$	414,834	$	367,562	12.9	%
Diluted EPS attributable to Henry Schein, Inc.	$	0.87	$	0.82	6.1	%	$	2.61	$	2.23	17.0	%
Non-GAAP Adjustments
Restructuring costs - Pre-tax	$	-	$	5,370			$	-	$	29,811
Income tax benefit for restructuring costs		-		(1,343)				-		(7,453)
Litigation settlement - Pre-Tax		-		-				5,325		-
Income tax benefit for litigation settlement		-		-				(2,130)		-
Total non-GAAP adjustments to Net Income	$	-	$	4,027			$	3,195	$	22,358
Non-GAAP Adjustments to diluted EPS	$	-	$	0.02			$	0.02	$	0.14
Non-GAAP Net Income attributable to Henry Schein, Inc.	$	138,031	$	137,740	0.2	%	$	418,029	$	389,920	7.2	%
Non-GAAP diluted EPS attributable to Henry Schein, Inc.	$	0.87	$	0.84	3.6	%	$	2.63	$	2.37	11.0	%

Management believes that non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance and allow for greater transparency with respect to key metrics used by management in operating our business. These non-GAAP financial measures are presented solely for informational and comparative purposes and should not be regarded as a replacement for corresponding, similarly captioned, GAAP measures.

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