-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WdKiJwVTjolrJsPLfbkCatqmgd+rDFHHcdt7PXpTVye6mv/orVzNTVsvAqzVrDd1 nxJsgiirBAWq0EYN3Z7zVQ== 0000009892-96-000011.txt : 19960502 0000009892-96-000011.hdr.sgml : 19960502 ACCESSION NUMBER: 0000009892-96-000011 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960501 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BARD C R INC /NJ/ CENTRAL INDEX KEY: 0000009892 STANDARD INDUSTRIAL CLASSIFICATION: SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841] IRS NUMBER: 221454160 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-06926 FILM NUMBER: 96554789 BUSINESS ADDRESS: STREET 1: 730 CENTRAL AVE CITY: MURRAY HILL STATE: NJ ZIP: 07974 BUSINESS PHONE: 9082778000 MAIL ADDRESS: STREET 1: 730 CENTRAL AVENUE CITY: MURRAY HILL STATE: NJ ZIP: 07974 10-Q 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended March 31, 1996 Commission File Number 1-6926 C. R. BARD, INC. (Exact name of registrant as specified in its charter) New Jersey 22-1454160 (State of incorporation) (I.R.S. Employer Identification No.) 730 Central Avenue, Murray Hill, New Jersey 07974 (Address of principal executive offices) Registrant's telephone number, including area code: (908) 277-8000 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Class Outstanding at April 29, 1996 Common Stock - $.25 par value 57,110,130 C. R. BARD, INC. AND SUBSIDIARIES INDEX Page No. PART I - FINANCIAL INFORMATION Condensed Consolidated Balance Sheets - March 31, 1996 and December 31, 1995 1 Condensed Statements of Consolidated Income and Retained Earnings For The Three Months Ended March 31, 1996 and 1995 2 Condensed Consolidated Statements of Cash Flows For The Three Months Ended March 31, 1996 and 1995 3 Notes to Consolidated Financial Statements 4 Management's Discussion and Analysis of Financial Condition and Results of Operations 5 PART II - OTHER INFORMATION 6 C. R. BARD, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (thousands of dollars)
March 31, December 31, 1996 1995 (Unaudited) ASSETS Current Assets: Cash and short-term investments $ 45,800 $ 51,300 Accounts receivable, net 226,400 215,700 Inventories 241,000 228,200 Other current assets 7,800 8,700 Total current assets 521,000 503,900 Property, plant and equipment, net 213,100 214,200 Intangible assets, net of amortization 314,000 315,500 Other assets 72,500 57,400 $1,120,600 $1,091,000
LIABILITIES AND SHAREHOLDERS' INVESTMENT Current Liabilities: Short-term borrowings and current maturities of long-term debt $ 102,600 $ 66,900 Accounts payable 42,000 62,700 Accrued expenses 147,900 131,400 Federal and foreign income taxes 6,900 12,300 Total current liabilities 299,400 273,300 Long-term debt 198,200 198,400 Other long-term liabilities 45,800 54,700 Shareholders' Investment Preferred stock, $1 par value, authorized 5,000,000 shares; none issued --- --- Common stock, $.25 par value, authorized 300,000,000 shares; issued and outstanding 57,214,134 shares and 57,100,598 shares 14,300 14,300 Capital in excess of par value 70,200 63,300 Retained earnings 487,300 478,900 Other 5,400 8,100 577,200 564,600 $1,120,600 $1,091,000
The accompanying notes to consolidated financial statements are an integral part of these balance sheets. -1- C. R. BARD, INC. AND SUBSIDIARIES CONDENSED STATEMENTS OF CONSOLIDATED INCOME AND RETAINED EARNINGS (thousands except per share amounts) (Unaudited)
For The Three Months Ended March 31, 1996 1995 Net sales $289,200 $278,100 Costs and expenses: Cost of goods sold 140,600 134,200 Marketing, selling and administrative 86,400 85,000 Research and development expense 19,300 19,200 Interest expense 6,000 6,000 Other(income)expense, net 26,300 (1,700) Total costs and expenses 278,600 242,700 Income before taxes 10,600 35,400 Provision (benefit) for income taxes (16,500) 10,500 Net income 27,100 24,900 Retained earnings, beginning of period 478,900 427,300 Treasury stock retired (9,600) (1,600) Cash dividends (9,100) (7,800) Retained earnings, end of period $487,300 $442,800 Weighted average shares outstanding 56,903 56,458 Net income per share $ .48 $ .44 Cash dividends per share $ .16 $ .15
The accompanying notes to consolidated financial statements are an integral part of these statements. -2- C. R. BARD, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (thousands of dollars) (Unaudited)
For The Three Months Ended March 31, 1996 1995 Cash flows from operating activities: Net income $ 27,100 $ 24,900 Noncash items and other (5,700) (12,600) 21,400 12,300 Cash flows from investing activities: Capital expenditures (8,100) (4,900) Other long-term investments, net (37,700) (1,200) (45,800) (6,100) Cash flows from financing activities: Purchase of common stock (9,700) (1,600) Dividends paid (9,100) (7,800) Other financing activities 42,500 6,800 23,700 (2,600) Cash and cash equivalents: Increase (decrease) during the period (700) 3,600 Balance at January 1, 37,400 34,500 Balance at March 31, $ 36,700 $ 38,100
The accompanying notes to consolidated financial statements are an integral part of these statements. -3- C. R. BARD, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS The financial statements contained in this filing have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission and have not been audited, however, the Company believes that it has included all adjustments, consisting only of normal recurring adjustments, which are necessary to present fairly the results of operations for these periods. The results of operations for the interim periods are not necessarily indicative of results of operations for a full year. These financial statements should be read in conjunction with the Consolidated Financial Statements and Notes to Consolidated Financial Statements, as filed by the Company in the 1995 Annual Report on Form 10-K. The Company applies APB Opinion No. 25 "Accounting for Stock Issued to Employees", and related interpretations in accounting for its stock plans. Accordingly, no compensation expense has been recognized for the stock-based compensation plans other than for restricted stock and performance-based awards. In March 1996 the Company received additional royalty payments under a license pertaining to the Company's angioplasty catheter balloon technology based upon a favorable judgment regarding the appropriate royalty rate. As a result "other income" includes approximately $9,900,000 in payments received on sales of these products for prior periods. Based upon a recently completed worldwide tax review, the Company has determined that approximately $15,000,000 in tax reserves are no longer required and have been reversed against the tax provision for the quarter ended March 31, 1996. The Company has reorganized its global cardiology business and plans to introduce an entirely new line of guidewire products during 1996. As a result, the Company has reviewed the assets associated with its cardiology business and has recorded a $31,000,000 ($16,800,000 net of tax) write down of assets related to its guidewire technology in accordance with the requirements of SFAS No. 121 "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of". In addition, the Company has recorded miscellaneous charges amounting to $6,000,000 primarily related to legal settlements. Excluding the effect of these unusual items, pretax income for the quarter ended March 31, 1996 would have been $37,700,000 with a related tax provision of $11,100,000 resulting in a net income of $26,600,000 or 47 cents per share. - 4 - C. R. BARD, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (continued) Included in the balance sheet caption "Cash and short-term investments" are short-term investments which have maturities greater than ninety days and amounted to $9,100,000 at March 31, 1996. These investments have not been treated as cash and cash equivalents for cash flow presentation purposes. During the first quarter of 1996, the Company spent $31,000,000 for the acquisition of St. Jude Medical's Cardiac Assist division, a manufacturer of intra-aortic balloon catheters, and a majority interest in X-Trode S.r.l., an Italian coronary stent manufacturer. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Consolidated net sales for the first quarter of 1996 of $289,200,000 was an increase of 4 percent over the first quarter 1995 sales of $278,100,000. Strong sales of angioplasty balloons in international regions as well as increases in angiography and radiology products contributed to the 6 percent increase in cardiovascular products. Strong Foley catheter sales during the quarter contributed to the 7 percent increase in urological products. Surgical sales were flat mainly as a result of competitive pricing pressures. PRODUCT GROUP SUMMARY OF NET SALES (in thousands) For the Three Months Ended March 31, Percent 1996 1995 Change Cardiovascular $ 96,500 $ 90,900 6 Urological 84,200 78,800 7 Surgical 108,500 108,400 - Net sales $289,200 $278,100 4 U.S. sales were $193,700,000 for the first quarter of 1996, an increase of 2 percent against the first quarter of 1995. Pricing pressures in the United States have decreased prices by 3 percent. International sales were $95,500,000 for the first quarter of 1996 representing an 8 percent increase. Currency translation contributed 1 percent of the increase to international sales for the quarter. The gross profit margin declined slightly from 51.7 percent to 51.4 percent for the three months ended March 31, 1995 and 1996, respectively, mainly as a result of pricing pressures. - 5 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) In March 1996 the Company received additional royalty payments pertaining to it's angioplasty catheter balloon technology. As a result "other income" includes approximately $9,900,000 in payments received on sales of these products for prior periods. Also included in the quarter are the reversal of tax reserves of $15,000,000, the writedown of assets of $31,000,000 ($16,800,000 net of tax) related to guidewire technology as well as several other miscellaneous charges. Excluding the effect of these unusual items, pretax income for the quarter ended March 31, 1996 would have been $37,700,000 with a related tax provision of $11,100,000 resulting in a net income of $26,600,000 or 47 cents per share. Net income of $27,100,000 and earnings per share of 48 cents for the quarter ended March 31, 1996 were increases of 9 percent compared with the first quarter of 1995. During the first three months of 1996 and 1995, the Company acquired 274,500 and 59,500, respectively, of its common shares which were retired. During the first quarter of 1996, the Company spent $31,000,000 on the acquisition of new businesses as discussed in the footnotes. Short-term borrowings were used to finance these transactions. Other shareholders' investment consisted of translation adjustment of $9,200,000 offset by $3,800,000 of unearned restricted stock at March 31, 1996 and translation adjustment of $12,400,000 offset by $4,300,000 of unearned restricted stock at December 31, 1995. PART II - OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security Holders. (a) The registrant held its Annual Meeting of Shareholders on April 17, 1996. - 6 - C. R. BARD, INC. AND SUBSIDIARIES Item 4. Submission of Matters to a Vote of Security Holders. (continued) (b) Proxies for the meeting were solicited pursuant to Regulation 14; there was no solicitation in opposition to management's nominees for directors as listed in the Proxy Statement and all such nominees were elected. The results of voting for the three Class III directors elected for a term of three years to serve until the 1999 Annual Meeting were as follow: T. Kevin Dunnigan, For - 49,051,884 Authority Withheld - 1,101,322; Regina E. Herzlinger, For - 49,044,946 Authority Withheld - 1,108,260; and William H. Longfield, For - 49,035,761 Authority Withheld - 1,117,445; and the additional Class I director elected for a term of one year was as follow: William C. Bopp, For - 49,056,459 Authority Withheld - 1,096,747. (c) Briefly described below is each other matter voted upon at the Annual Meeting and the number of affirmative votes, negative votes and abstentions and broker nonvotes with respect to each matter. (i) Approval of the amendment to the Company's Restated Certificate of Incorporation which will reduce the maximum number of directors of the Company For 49,773,228 Against 202,479 Abstain and Broker Nonvotes 177,499 (ii) Approval of an amendment to the Company's 1993 Long Term Incentive Plan to increase the number of shares of Common Stock available for grant thereunder and amend other provisions. For 41,404,192 Against 8,352,279 Abstain and Broker Nonvotes 396,735 (iii) Ratification of the appointment of Arthur Andersen LLP as independent public accountants for the year 1996. For 49,916,159 Against 105,732 Abstain and Broker Nonvotes 131,315 - 7 - C. R. BARD, INC. AND SUBSIDIARIES Item 4. Submission of Matters to a Vote of Security Holders. (continued) (iv) Shareholder proposal relating to annual election of directors. For 20,327,648 Against 24,880,414 Abstain and Broker Nonvotes 463,140 (v) Shareholder proposal relating to compensation of non-employee directors. For 9,394,062 Against 35,823,287 Abstain and Broker Nonvotes 453,853 Item 6. Exhibits and Reports on Form 8-K (a) Exhibit 27 - Financial Data Schedule (b) There were no reports on Form 8-K filed by the Company during the quarter ended March 31, 1996. SIGNATURES 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, thereunto duly authorized. C. R. BARD, INC. (Registrant) William C. Bopp /s/ William C. Bopp Executive Vice President and Chief Financial Officer Charles P. Grom /s/ Charles P. Grom Vice President and Controller and Chief Accounting Officer DATE: May 1, 1996 - 8 - EX-27 2
5 1,000 3-MOS DEC-31-1996 MAR-31-1996 45,800 0 226,400 9,600 241,000 521,000 343,200 130,100 1,120,600 299,400 198,200 0 0 14,300 553,700 1,120,600 289,200 289,200 140,600 140,600 105,700 0 6,000 10,600 (16,500) 27,100 0 0 0 27,100 .48 .48
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