Note 6 — Segment Data

The Company’s organizational structure is based upon its three principal business segments: BD Medical (“Medical”), BD Diagnostics (“Diagnostics”) and BD Biosciences (“Biosciences”). These segments are strategic businesses that are managed separately because each one develops, manufactures and markets distinct products and services.

The Medical segment produces a broad array of medical devices that are used in a wide range of healthcare settings. The principal product lines in the Medical segment include needles, syringes and intravenous catheters for medication delivery (including safety-engineered and auto-disable devices); prefilled IV flush syringes; syringes and pen needles for the injection of insulin and other drugs used in the treatment of diabetes; prefillable drug delivery systems provided to pharmaceutical companies and sold to end-users as drug/device combinations; regional anesthesia needles and trays; sharps disposal containers; closed-system transfer devices; and generic prefilled injectables.

The Diagnostics segment produces products for the safe collection and transport of diagnostics specimens, as well as instruments and reagent systems to detect a broad range of infectious diseases, healthcare-associated infections (“HAIs”) and cancers. The principal products and services in the Diagnostics segment include integrated systems for specimen collection; safety-engineered blood collection products and systems; automated blood culturing and tuberculosis culturing systems; molecular testing systems for infectious diseases and women’s health; microorganism identification and drug susceptibility systems; liquid-based cytology systems for cervical cancer screening; rapid diagnostic assays; microbiology laboratory automation; and plated media.

The Biosciences segment produces research and clinical tools that facilitate the study of cells, and the components of cells, to gain a better understanding of normal and disease processes. The principal product lines in the Biosciences segment include fluorescence-activated cell sorters and analyzers; monoclonal antibodies and kits for performing cell analysis; reagent systems for life science research; diagnostic assays; and cell culture media supplements for biopharmaceutical manufacturing.

Effective October 1, 2014, the Company’s organizational structure was realigned to better complement its customer-focused solutions strategy. The composition of the Medical segment remains unchanged and the former Diagnostics and Biosciences segments have been combined into one segment, BD Life Sciences (“Life Sciences”). Beginning in the first quarter of fiscal year 2015, decisions about resource allocation and performance assessment will be made separately for the Medical and Life Sciences segments. Additionally, the Company’s financial reporting will reflect this realigned organizational structure and corresponding prior-period information presented for comparative purposes will be revised to reflect the two-segment structure.

The Company evaluates performance of its business segments and allocates resources to them primarily based upon operating income. Segment operating income represents revenues reduced by product costs and operating expenses.

Distribution of products is primarily through independent distribution channels, and directly to end-users by BD and independent sales representatives. No customer accounted for 10% or more of revenues in any of the three years presented.


(Millions of dollars)	2014			2013			2012
Revenues(A)
Medical	$	4,573		$	4,306		$	4,091
Diagnostics		2,713			2,646			2,538
Biosciences		1,159			1,102			1,080

Total Revenues	$	8,446		$	8,054		$	7,708

Segment Operating Income
Medical	$	1,291	(B)(C)	$	1,233		$	1,162
Diagnostics		585	(B)(D)		638			653
Biosciences		275	(B)(E)		269			262

Total Segment Operating Income		2,152			2,140			2,077
Unallocated Items(F)		(630	)(B)(G)		(976	)(H)		(605	)

Income From Continuing Operations Before Income Taxes	$	1,522		$	1,165		$	1,472

Segment Assets
Medical	$	4,668		$	4,582		$	4,245
Diagnostics		2,619			2,571			2,462
Biosciences		1,164			1,205			1,407

Total Segment Assets		8,451			8,357			8,114
Corporate and All Other(I)		3,997			3,792			3,247

Total Assets	$	12,447		$	12,149		$	11,361

Capital Expenditures
Medical	$	420		$	354		$	363
Diagnostics		140			142			101
Biosciences		15			16			14
Corporate and All Other		16			9			10

Total Capital Expenditures	$	592		$	522		$	487

Depreciation and Amortization
Medical	$	293		$	259		$	240
Diagnostics		187			190			175
Biosciences		64			77			79
Corporate and All Other		18			19			18

Total Depreciation and Amortization	$	562		$	546		$	511

(A)	Intersegment revenues are not material.

(B)

Includes a $36 million charge associated with workforce reduction actions. The portions of this charge attributable to the Medical, Diagnostics, and Biosciences segments were $21 million, $5 million and $5 million, respectively. The amount of the charge attributable to corporate functions was $5 million. Additional disclosures regarding these actions are provided in Note 8.

(C)	Includes a $6 million charge associated with the decision to terminate a research and development program; the charge relates to program asset write-offs and obligations. Additionally includes $4 million of acquisition-related costs.

(D)	Includes an $11 million charge that resulted from the early termination of a European distributor agreement, as well as a $5 million charge due to and adjustment to the carrying amount of an asset that is being held for sale.

(E)

Includes a $20 million charge primarily resulting from the discontinuance of an instrument product development program. The charge is largely attributable to capitalized product software, but also includes a lesser amount attributable to fixed assets. Additionally includes $1 million of acquisition-related costs.

(F)	Includes primarily interest, net; foreign exchange; corporate expenses; and share-based compensation expense.

(G)	Includes an $8 million gain resulting from the Company’s receipt of cash proceeds from the sale of a company in which it held a small equity ownership interest.

(H)

Includes the $341 million charge associated with the unfavorable verdict returned in the antitrust and false advertising lawsuit filed against the Company by RTI as well as the $22 million charge associated with the litigation settlement related to indirect purchaser antitrust class action cases. Additional disclosures regarding these matters are provided in Note 5.

(I)	Includes cash and investments and corporate assets.


(Millions of dollars)
Revenues by Organizational Units	2014		2013		2012
BD Medical
Medical Surgical Systems	$	2,307	$	2,196	$	2,105
Diabetes Care		1,037		969		911
Pharmaceutical Systems		1,229		1,142		1,074

		4,573		4,306		4,091

BD Diagnostics
Preanalytical Systems		1,412		1,352		1,301
Diagnostic Systems		1,301		1,294		1,237

		2,713		2,646		2,538

BD Biosciences		1,159		1,102		1,080

Total Revenues	$	8,446	$	8,054	$	7,708

Geographic Information

The countries in which the Company has local revenue-generating operations have been combined into the following geographic areas: the United States (including Puerto Rico), Europe, Asia Pacific and Other, which is comprised of Latin America, Canada and Japan.

Revenues to unaffiliated customers are based upon the source of the product shipment. Long-lived assets, which include net property, plant and equipment, are based upon physical location.


(Millions of dollars)	2014		2013		2012
Revenues
United States	$	3,417	$	3,353	$	3,288
Europe		2,733		2,512		2,379
Asia Pacific		1,121		1,006		883
Other		1,175		1,183		1,159

	$	8,446	$	8,054	$	7,708

Long-Lived Assets
United States	$	3,126	$	3,251	$	3,156
Europe		1,809		1,667		1,559
Asia Pacific		486		442		397
Other		555		565		624
Corporate		340		350		303

	$	6,317	$	6,276	$	6,039