-----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, GylkjLAzf1yNw49nP+fO5+8Nev+O6Nutgqu2UgMVxOnC+fooe3sKGlNSvfWox85j LtRy/NzGksjvkd1IjhrsUg== 0000009892-97-000016.txt : 19970804 0000009892-97-000016.hdr.sgml : 19970804 ACCESSION NUMBER: 0000009892-97-000016 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970801 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: 97650302 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 UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended June 30, 1997 Commission File Number 1-6926 C. R. BARD, INC. (Exact name of registrant as specified in its charter) New Jersey (State of incorporation) 22-1454160 (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 July 21, 1997 Common Stock - $.25 par value 57,413,194 C. R. BARD, INC. AND SUBSIDIARIES INDEX Page No. PART I - FINANCIAL INFORMATION Condensed Consolidated Balance Sheets - June 30, 1997 and December 31, 1996 1 Condensed Statements of Consolidated Income and Retained Earnings For The Quarter and Six Months Ended June 30, 1997 and 1996 2 Condensed Consolidated Statements of Cash Flows For The Six Months Ended June 30, 1997 and 1996 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)
June 30, December 31, 1997 1996 (Unaudited) ASSETS Current Assets: Cash and short-term investments $ 75,700 $ 78,000 Accounts receivable, net 247,800 245,400 Inventories 249,600 245,000 Other current assets 11,900 8,500 Total current assets 585,000 576,900 Property, plant and equipment, net 223,200 226,100 Intangible assets, net of amortization 431,200 447,200 Other assets 88,000 82,300 $1,327,400 $1,332,500
LIABILITIES AND SHAREHOLDERS' INVESTMENT Current Liabilities: Short-term borrowings and current maturities of long-term debt $ 144,900 $ 148,200 Accounts payable 51,300 59,200 Accrued expenses 115,000 121,500 Federal and foreign income taxes 14,800 7,300 Total current liabilities 326,000 336,200 Long-term debt 341,300 342,800 Other long-term liabilities 52,900 52,000 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 57,123,661 shares and 56,985,983 shares 14,300 14,300 Capital in excess of par value 86,400 77,500 Retained earnings 530,900 506,700 Other (24,400) 3,000 607,200 601,500 $1,327,400 $1,332,500
The accompanying notes to condensed 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 Quarter Ended For Six Months Ended June 30, June 30, 1997 1996 1997 1996 Net sales $304,000 $295,200 $604,700 $584,400 Costs and expenses: Cost of goods sold 143,700 143,300 286,900 283,900 Marketing, selling and administrative 96,600 90,000 190,700 176,400 Research & development 21,500 19,800 42,600 39,100 Interest expense 8,500 6,100 16,700 12,100 Other(income)expense, net (4,000) (3,000) (7,800) 23,300 Total costs and expenses 266,300 256,200 529,100 534,800 Income before taxes 37,700 39,000 75,600 49,600 Provision(benefit) for income taxes 11,500 11,500 23,300 (5,000) Net income 26,200 27,500 52,300 54,600 Retained earnings, beginning of period 522,400 487,300 506,700 478,900 Treasury stock retired (8,000) (10,800) (8,700) (20,300) Cash dividends (9,700) (9,100) (19,400) (18,300) Retained earnings, end of period $530,900 $494,900 $530,900 $494,900 Weighted average shares outstanding 57,021 57,009 Net income per share $ .46 $ .48 $ .92 $ .96 Cash dividends per share $ .17 $ .16 $ .34 $ .32
The accompanying notes to condensed 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 Six Months Ended June 30, 1997 1996 Cash flows from operating activities: Net income $ 52,300 $ 54,600 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 30,200 31,100 Other non-cash items 200 1,000 Changes in assets and liabilities: Current assets (11,700) (27,900) Current liabilities (6,900) (37,500) Other 900 1,900 65,000 23,200 Cash flows from investing activities: Capital expenditures (18,200) (17,900) Other long-term investments, net (26,400) (44,000) (44,600) (61,900) Cash flows from financing activities: Purchase of common stock (8,700) (20,500) Dividends paid (19,400) (18,300) Short-term borrowings and other 5,600 101,300 Long-term borrowings (1,500) (3,600) (24,000) 58,900 Net increase in cash and cash equivalents (3,600) 20,200 Cash and cash equivalents at January 1, 63,600 37,400 Cash and cash equivalents at June 30, $ 60,000 $ 57,600
The accompanying notes to condensed consolidated financial statements are an integral part of these statements. -3- C. R. BARD, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED 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, C. R. Bard, Inc. ("Bard" or 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 1996 Annual Report on Form 10-K. Accounting Policies 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 $15,700,000 at June 30, 1997. These investments have not been treated as cash and cash equivalents for cash flow presentation purposes. The Company enters into foreign exchange options to help reduce the exposure to fluctuations between certain currencies. These off balance sheet options are accounted for on a mark-to-market basis. The gains and losses associated with these options are recorded on the income statement as "other income and expense" and on the balance sheet as "other current assets" or "accrued expenses". Cash flows associated with the settlement of these options are reflected as operating activities. Effective for fiscal years ending after December 15, 1997, the Company is required to adopt Statement of Financial Accounting Standard No. 128 "Earnings Per Share" ("FAS 128"). FAS 128 requires the presentation of basic earnings per share and diluted earnings per share. "Basic earnings per share" represents net income divided by the weighted average shares outstanding and is consistent with the Company's historical presentation. "Diluted earnings per share" represents net income divided by weighted average shares outstanding adjusted for the incremental dilution of outstanding employee stock options and awards. Diluted earnings per share would have been $.45 and $.47, respectively for the three months ended June 30, 1997 and 1996 and $.91 and $.94 for the six months ended June 30, 1997 and 1996. - 4 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Consolidated net sales for the second quarter of 1997 of $304,000,000 was an increase of 3 percent over the second quarter 1996 sales of $295,200,000. Sales for the first six months of 1997 of $604,700,000 increased 3 percent over the $584,400,000 for the same period last year. Sales in the U.S. for the second quarter of 1997 were $198,700,000, an increase of 4 percent from 1996, while international sales were 105,300,000, up 1 percent against last year. The impact of a strengthening dollar in the second quarter decreased sales outside the U.S. by 7 percent. For the first six months of 1997, U.S. sales totaled $397,000,000, up 3 percent, while international sales increased 4 percent to $207,700,000. Currency translation for the first half of 1997 decreased international sales by approximately 6 percent and decreased worldwide sales by approximately 2 percent. PRODUCT GROUP SUMMARY OF NET SALES (in thousands) Quarter Ended June 30, Six Months Ended June 30, Percent Percent 1996 1995 Change 1996 1995 Change Vascular $116,100 $107,700 8 $227,700 $210,300 8 Urology 76,200 75,300 1 154,200 148,300 4 Oncology 55,100 52,700 5 110,400 105,700 4 Surgery 32,300 28,100 15 62,900 56,100 12 Sub-Total Emphasis Products $279,700 263,800 6 $555,200 $520,400 7 Other 24,300 31,400 (23) 49,500 64,000 (23) Total Worldwide $304,000 $295,200 3 $604,700 $584,400 3 Increased graft sales due to the IMPRA acquisition contributed to the 8 percent increase in vascular sales for the quarter. Basic drainage products contributed to the urology increase of 1 percent for the quarter. Second quarter increases in specialty access products and mesh were primarily responsible for the 5 and 15 percent growth in the oncology and surgery categories, respectively. - 5 - C. R. BARD, INC. AND SUBSIDIARIES The gross profit margin increased to 52.6 percent from 51.4 percent for the six months ended June 30, 1997 and 1996, respectively, mainly as a result of product mix and favorable variances. Other income and expense is composed primarily of recurring items such as interest income and foreign exchange. In addition, in the second quarter of 1997 other income includes the gain from the sale of an investment of approximately $1,800,000. In the second quarter of 1996, other income included a one-time credit of $2,500,000 related to the elimination of a contractual arrangement. The Company's results for the quarter ended June 30, 1997 were net income of $26,200,000 or $.46 per share as compared with $27,500,000 or $.48 per share for the same quarter in 1996. During the first six months of 1997 and 1996, the Company acquired 275,000 and 593,900, respectively, of its common shares which were retired. PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8-K (a) Exhibit 12.1 - Computation of Ratio of Earnings to Fixed Charges (b) Exhibit 27 - Financial Data Schedule (c) There were no reports on Form 8-K filed by the Company during the quarter ended June 30, 1997. - 6 - C. R. BARD, INC. AND SUBSIDIARIES 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: August 1, 1997 - 7 - EX-12 2 Exhibit 12.1 Computation of Ratio of Earnings to Fixed Charges
Six Months Ending 6/30/97 1996 1995 1994 1993 1992 Earnings before taxes $75,600 $102,700 $123,500 $104,100 $101,400 $120,200 Add(Deduct) Fixed Charges 19,900 33,500 31,500 23,200 18,700 19,900 Undistributed earnings of less than 50% owned companies carried at equity (300) (700) (800) (400) (200) (500) Interest capitalized 0 0 0 (200) 0 (300) Earnings available for fixed charges $95,200 $135,500 $154,200 $126,700 $119,900 $139,300 Fixed charges: Interest, including amounts capitalized 16,700 26,400 24,200 16,500 12,500 13,700 Proportion of rent expense deemed to represent interest factor 3,200 7,100 7,300 6,700 6,200 6,200 Fixed Charges $19,900 $ 33,500 $ 31,500 $ 23,200 $ 18,700 $ 19,900 Ratio of earnings to fixed charges 4.78 4.04 4.89 5.46 6.41 7.00
EX-27 3
5 1,000 6-MOS DEC-31-1997 JUN-30-1997 75700 0 247800 11800 249600 585000 375100 151900 1327400 326000 341300 0 0 14300 592900 1327400 604700 604700 286900 286900 225500 0 16700 75600 23300 52300 0 0 0 52300 .92 .92
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