- Third-quarter 2024 GAAP diluted EPS of $0.78 and non-GAAP
diluted EPS of $1.22
- Operating cash flow of $151 million for the third quarter of
2024; year-to-date operating cash flow of $644 million, up $112
million compared with year-to-date 2023
- Increases 2024 full-year non-GAAP EPS guidance to $4.74 to
$4.82 from $4.70 to $4.82
Henry Schein, Inc. (Nasdaq: HSIC), the world’s largest provider
of health care solutions to office-based dental and medical
practitioners, today reported financial results for the third
quarter ended September 28, 2024.
“Our businesses performed well during the third quarter, driven
by the continued successful implementation of our BOLD+1 Strategic
Plan that is resulting in growth and efficiency throughout the
business, and a strong contribution from high-growth, high-margin
products and services,” said Stanley M. Bergman, Chairman of the
Board and Chief Executive Officer of Henry Schein. “We believe we
continued to steadily gain market share in our dental and medical
distribution businesses following last year’s cyber incident. Our
dental equipment business is showing ongoing stability in North
America and increased investment by customers in Europe, Australia
and New Zealand. Implant and endodontic products had good growth in
Europe and Brazil, as well as North America following the
successful launch of the BioHorizons Tapered Pro Conical implant in
the U.S.,” Mr. Bergman added.
“Acquisitions made during our 2022 to 2024 strategic planning
cycle, along with new product launches, are delivering strong
financial results, and our restructuring plan is on target. We also
continue to return capital to shareholders through our share
repurchase program. As a result, we exceeded our financial
expectations for the quarter, and so today we are increasing our
non-GAAP EPS guidance to $4.74 to $4.82,” Mr. Bergman
concluded.
Third-Quarter 2024 Financial Results
- Total net sales for the quarter were $3.2 billion, an
increase of 0.4% compared with the third quarter of 2023. This
reflects 3.2% sales growth from acquisitions, a 0.2% sales decrease
resulting from foreign currency exchange rates, a 0.4% sales
decrease from lower sales of personal protective equipment (PPE),
primarily the result of lower glove pricing, and the pace of
recovery from the cyber incident late last year.
- Internal sales for the quarter decreased 2.6%, which
includes a 0.4% decrease from lower PPE sales.
Third-quarter sales and internal sales growth are summarized
below and detailed in Exhibit A1.
Sales ($ Billion)
Total Growth/(Decrease)1
(%)
Internal
Growth/(Decrease)1 (%)
Global Dental
$1.9
(1.6%)
(1.6%)
Merchandise
$1.4
(2.8%)
(2.5%)
Equipment
$0.4
2.8%
1.8%
Global Medical
$1.1
2.9%
(4.8%)
Global Technology and Value-Added
Services
$0.2
5.1%
(1.1%)
TOTAL SALES
$3.2
0.4%
(2.6%)
Note: items may not sum due to
rounding
- GAAP net income2 for the quarter was $99 million, or
$0.78 per diluted share4, and compares with third-quarter 2023 GAAP
net income of $137 million, or $1.05 per diluted share.
- Non-GAAP net income2 for the quarter was $155 million,
or $1.22 per diluted share4, and compares with third-quarter 2023
non-GAAP net income of $173 million, or $1.32 per diluted share.
GAAP and non-GAAP diluted EPS included a remeasurement gain of
$0.11 resulting from the purchase of a controlling interest of a
previously held non-controlling equity investment.
- Operating cash flow for the quarter was $151 million and
compares with operating cash flow in the third-quarter 2023 of $231
million.
- Adjusted EBITDA3 for the quarter was $268 million and
compares with third-quarter 2023 Adjusted EBITDA of $278
million.
Year-to-Date Financial Results
- Total net sales for the first nine months of 2024 were
$9.5 billion, an increase of 1.7% compared with the first nine
months of 2023. This reflects 4.1% sales growth from acquisitions,
a 0.1% sales decrease resulting from foreign currency exchange
rates, a 0.6% sales decrease from lower sales of personal
protective equipment, and the pace of recovery from the cyber
incident late last year.
- Internal sales for the first nine months of 2024
decreased 2.3%, which includes a 0.6% decrease from lower PPE
sales.
First nine months of 2024 sales and internal sales growth are
summarized below and detailed in Exhibit A1.
Sales ($ Billion)
Total Growth/(Decrease)1
(%)
Internal
Growth/(Decrease)1
(%)
Global Dental
$5.7
(0.8%)
(2.2%)
Merchandise
$4.4
(1.3%)
(3.0%)
Equipment
$1.3
0.9%
0.5%
Global Medical
$3.1
5.0%
(3.3%)
Global Technology and Value-Added
Services
$0.7
9.7%
1.9%
TOTAL SALES
$9.5
1.7%
(2.3%)
Note: items may not sum due to
rounding
- GAAP net income2 for the first nine months of 2024 was
$296 million, or $2.30 per diluted share4, and compares with first
nine months of 2023 GAAP net income of $398 million, or $3.02 per
diluted share.
- Non-GAAP net income2 for the first nine months of 2024
was $456 million, or $3.55 per diluted share4, and compares with
first nine months of 2023 non-GAAP net income of $507 million, or
$3.84 per diluted share. GAAP and non-GAAP diluted EPS for the
first nine months included a remeasurement gain of $0.11 resulting
from the purchase of a controlling interest of a previously held
equity investment and compares with a remeasurement gain of $0.10
recorded in the second quarter of 2023.
- Operating cash flow for the first nine months of 2024
was $644 million, an increase of $112 million compared with the
first nine months of 2023.
- Adjusted EBITDA3 for the first nine months of 2024 was
$791 million and compares with first nine months of 2023 Adjusted
EBITDA of $813 million.
Restructuring Plan
During the third quarter of 2024, the Company recorded $48
million in restructuring costs. This includes $12 million incurred
as part of the plan announced in the third quarter of 2022, which
was completed on July 31, 2024, and $36 million incurred as part of
the 2024/2025 restructuring initiative announced last quarter.
Actions approved in the third quarter under the new restructuring
plan are estimated to provide over $50 million in annual run-rate
savings, which the Company believes indicates strong progress
towards its goal of $75 million to $100 million in annual run-rate
savings by the end of 2025.
Share Repurchases
During the third quarter of 2024, the Company repurchased
approximately 2.0 million shares of its common stock at an average
price of $69.09 per share, for a total of $135 million. The impact
of these share repurchases on third-quarter diluted EPS was
immaterial.
At quarter-end, Henry Schein had $455 million authorized and
available for future stock repurchases and the Company expects to
continue to repurchase shares in the fourth quarter.
2024 Financial Guidance
Henry Schein is updating full-year 2024 financial guidance, as
described below. Guidance is for current continuing operations as
well as acquisitions that have closed, and does not include the
impact of potential future acquisitions and share repurchases,
restructuring and integration expenses, amortization expense of
acquired intangible assets, contingent consideration revaluation
adjustments, certain expenses directly associated with the cyber
incident or any related insurance claim recovery. This guidance
also assumes that foreign currency exchange rates remain generally
consistent with current levels and that end markets remain
consistent with current market conditions.
- 2024 total sales growth is now expected to be 4% to 5% over
2023, compared with prior guidance of 4% to 6% growth.
- 2024 non-GAAP diluted EPS attributable to Henry Schein, Inc. is
now expected to be $4.74 to $4.82, compared with prior guidance of
$4.70 to $4.82, and reflects growth of 5% to 7% compared with 2023
non-GAAP diluted EPS of $4.50.
- 2024 Adjusted EBITDA is expected to grow in the
low-double-digit percentages versus 2023 Adjusted EBITDA, and is
unchanged compared to prior guidance.
Adjustments to 2024 GAAP Net Income and Diluted EPS
The Company is providing guidance for 2024 diluted EPS on a
non-GAAP basis and for 2024 Adjusted EBITDA, as noted above. The
Company is not providing a reconciliation of its 2024 non-GAAP
guidance to its projected 2024 diluted EPS prepared on a GAAP
basis, or its projected 2024 Adjusted EBITDA to net income prepared
on a GAAP basis. This is because the Company is unable to provide
without unreasonable effort an estimate of restructuring costs
related to an ongoing initiative to drive operating efficiencies,
including the corresponding tax effect, which will be included in
the Company’s 2024 diluted EPS and net income prepared on a GAAP
basis. The inability to provide this reconciliation is due to the
uncertainty and inherent difficulty of predicting the occurrence,
magnitude, financial impact, and timing of related costs.
Management does not believe these items are representative of
the Company’s underlying business performance. For the same
reasons, the Company is unable to address the probable significance
of the unavailable information, which could be material to future
results.
1 See Exhibit A for details of sales growth. Internal sales
growth is calculated from total net sales using constant foreign
currency exchange rates and excludes sales from acquisitions. 2 See
Exhibit B for a reconciliation of GAAP net income and diluted EPS
to non-GAAP net income and diluted EPS. 3 See Exhibit C for a
reconciliation of GAAP net income to Adjusted EBITDA. 4 References
to diluted EPS refer to diluted EPS attributable to Henry Schein,
Inc.
Third-Quarter 2024 Conference Call Webcast
The Company will hold a conference call to discuss third-quarter
2024 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 by visiting
www.henryschein.com/IRwebcasts. In addition, a replay will be
available beginning shortly after the call has ended for a period
of one week.
The Company will be posting slides that provide a summary of its
third-quarter 2024 financial results on its website at
https://www.henryschein.com/us-en/Corporate/investor-presentations.aspx.
About Henry Schein, Inc.
Henry Schein, Inc. (Nasdaq: HSIC) is a solutions company for
health care professionals powered by a network of people and
technology. With approximately 26,000 Team Schein Members
worldwide, the Company's network of trusted advisors provides more
than 1 million customers globally with more than 300 valued
solutions that help improve operational success and clinical
outcomes. Our Business, Clinical, Technology and Supply Chain
solutions help office-based dental and medical practitioners work
more efficiently so they can provide quality care more effectively.
These solutions also support dental laboratories, government and
institutional health care clinics, as well as other alternate care
sites.
Henry Schein operates through a centralized and automated
distribution network, with a selection of more than 300,000 branded
products and Henry Schein corporate brand products in our main
distribution centers.
A FORTUNE 500 Company and a member of the S&P 500® index,
Henry Schein is headquartered in Melville, N.Y., and has operations
or affiliates in 33 countries and territories. The Company's sales
reached $12.3 billion in 2023, and have grown at a compound annual
rate of approximately 11.5 percent since Henry Schein became a
public company in 1995.
For more information, visit Henry Schein at www.henryschein.com,
Facebook.com/HenrySchein, Instagram.com/HenrySchein, and
@HenrySchein on X.
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 include total sales growth, EPS and
Adjusted EBITDA guidance and are generally identified by the use of
such terms as “may,” “could,” “expect,” “intend,” “believe,”
“plan,” “estimate,” “forecast,” “project,” “anticipate,” “to be,”
“to make” or other comparable terms. A fuller discussion of our
operations, financial condition and status of litigation matters,
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, including our
Annual Report on Form 10-K, 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: our dependence on third parties for the
manufacture and supply of our products; our ability to develop or
acquire and maintain and protect new products (particularly
technology products) and technologies that achieve market
acceptance with acceptable margins; transitional challenges
associated with acquisitions, dispositions and joint ventures,
including the failure to achieve anticipated synergies/benefits, as
well as significant demands on our operations, information systems,
legal, regulatory, compliance, financial and human resources
functions in connection with acquisitions, dispositions and joint
ventures; certain provisions in our governing documents that may
discourage third-party acquisitions of us; adverse changes in
supplier rebates or other purchasing incentives; risks related to
the sale of corporate brand products; security risks associated
with our information systems and technology products and services,
such as cyberattacks or other privacy or data security breaches
(including the October 2023 incident); effects of a highly
competitive (including, without limitation, competition from
third-party online commerce sites) and consolidating market;
changes in the health care industry; 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 and domestic
macro-economic and political conditions, including inflation,
deflation, recession, ongoing wars, fluctuations in energy pricing
and the value of the U.S. dollar as compared to foreign currencies,
and changes to other economic indicators, international trade
agreements, potential trade barriers and terrorism; geopolitical
wars; failure to comply with existing and future regulatory
requirements; risks associated with the EU Medical Device
Regulation; failure to comply with laws and regulations relating to
health care fraud or other laws and regulations; failure to comply
with laws and regulations relating to the collection, storage and
processing of sensitive personal information or standards in
electronic health records or transmissions; changes in tax
legislation; risks related to product liability, intellectual
property and other claims; risks associated with customs policies
or legislative import restrictions; risks associated with disease
outbreaks, epidemics, pandemics (such as the COVID-19 pandemic), or
similar wide-spread public health concerns and other natural or
man-made disasters; risks associated with our global operations;
litigation risks; new or unanticipated litigation developments and
the status of litigation matters; our dependence on our senior
management, employee hiring and retention, and our relationships
with customers, suppliers and manufacturers; and disruptions in
financial markets. 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
except as required by law.
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 the 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. The impact of certain
items that are excluded include integration and restructuring
costs, and amortization of acquisition-related assets, because the
amount and timing of such charges are significantly impacted by the
timing, size, number and nature of the acquisitions we consummate
and occur on an unpredictable basis. 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.
(TABLES TO FOLLOW)
HENRY SCHEIN, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME
(in millions, except share and
per share data)
(unaudited)
Three Months Ended
Nine Months Ended
September 28,
September 30,
September 28,
September 30,
2024
2023
2024
2023
Net sales
$
3,174
$
3,162
$
9,482
$
9,322
Cost of sales
2,181
2,167
6,459
6,386
Gross profit
993
995
3,023
2,936
Operating expenses:
Selling, general and administrative
724
725
2,296
2,149
Depreciation and amortization
64
59
188
152
Restructuring costs
48
11
73
59
Operating income
157
200
466
576
Other income (expense):
Interest income
7
6
18
12
Interest expense
(34
)
(25
)
(96
)
(58
)
Other, net
(2
)
(2
)
(1
)
(2
)
Income before taxes, equity in earnings of
affiliates and noncontrolling interests
128
179
387
528
Income taxes
(32
)
(39
)
(97
)
(119
)
Equity in earnings of affiliates, net of
tax
3
3
12
10
Net income
99
143
302
419
Less: Net income attributable to
noncontrolling interests
-
(6
)
(6
)
(21
)
Net income attributable to Henry Schein,
Inc.
$
99
$
137
$
296
$
398
Earnings per share attributable to
Henry Schein, Inc.:
Basic
$
0.79
$
1.06
$
2.32
$
3.04
Diluted
$
0.78
$
1.05
$
2.30
$
3.02
Weighted-average common shares
outstanding:
Basic
126,124,715
130,388,353
127,550,045
130,888,717
Diluted
127,054,934
131,442,135
128,498,494
132,149,172
HENRY SCHEIN, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in millions, except share
data)
September 28,
December 30,
2024
2023
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
126
$
171
Accounts receivable, net of allowance for
credit losses of $86 and $83
1,660
1,863
Inventories, net
1,754
1,815
Prepaid expenses and other
607
639
Total current assets
4,147
4,488
Property and equipment, net
540
498
Operating lease right-of-use assets
304
325
Goodwill
3,986
3,875
Other intangibles, net
1,100
916
Investments and other
528
471
Total assets
$
10,605
$
10,573
LIABILITIES, REDEEMABLE NONCONTROLLING
INTERESTS AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable
$
1,026
$
1,020
Bank credit lines
638
264
Current maturities of long-term debt
109
150
Operating lease liabilities
77
80
Accrued expenses:
Payroll and related
289
332
Taxes
159
137
Other
631
700
Total current liabilities
2,929
2,683
Long-term debt
1,906
1,937
Deferred income taxes
123
54
Operating lease liabilities
262
310
Other liabilities
414
436
Total liabilities
5,634
5,420
Redeemable noncontrolling interests
832
864
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value,
1,000,000 shares authorized,
none outstanding
-
-
Common stock, $0.01 par value, 480,000,000
shares authorized,
125,154,194 outstanding on September 28,
2024 and
129,247,765 outstanding on December 30,
2023
1
1
Additional paid-in capital
-
-
Retained earnings
3,766
3,860
Accumulated other comprehensive loss
(264
)
(206
)
Total Henry Schein, Inc. stockholders'
equity
3,503
3,655
Noncontrolling interests
636
634
Total stockholders' equity
4,139
4,289
Total liabilities, redeemable
noncontrolling interests and stockholders' equity
$
10,605
$
10,573
HENRY SCHEIN, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in
millions)/(unaudited)
Three Months Ended
Nine Months Ended
September 28,
September 30,
September 28,
September 30,
2024
2023
2024
2023
Cash flows from operating
activities:
Net income
$
99
$
143
$
302
$
419
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
74
69
221
180
Non-cash restructuring charges
5
3
11
13
Stock-based compensation expense
10
14
30
38
Provision for losses on trade and other
accounts receivable
5
5
12
7
Benefit from deferred income taxes
(22
)
(1
)
(41
)
(4
)
Equity in earnings of affiliates
(3
)
(3
)
(12
)
(10
)
Distributions from equity affiliates
1
3
10
12
Changes in unrecognized tax benefits
-
2
3
5
Other
(16
)
(2
)
(25
)
(11
)
Changes in operating assets and
liabilities, net of acquisitions:
Accounts receivable
(82
)
(90
)
188
(72
)
Inventories
(69
)
17
38
180
Other current assets
(12
)
(54
)
38
(55
)
Accounts payable and accrued expenses
161
125
(131
)
(170
)
Net cash provided by operating
activities
151
231
644
532
Cash flows from investing
activities:
Purchases of property and equipment
(34
)
(40
)
(112
)
(108
)
Payments related to equity investments and
business acquisitions,
net of cash acquired
(42
)
(417
)
(223
)
(668
)
Proceeds from loan to affiliate
-
1
3
4
Capitalized software costs
(10
)
(10
)
(30
)
(30
)
Other
(5
)
(2
)
(10
)
(6
)
Net cash used in investing activities
(91
)
(468
)
(372
)
(808
)
Cash flows from financing
activities:
Net change in bank credit lines
132
(316
)
374
(98
)
Proceeds from issuance of long-term
debt
30
750
120
1,158
Principal payments for long-term debt
(16
)
(91
)
(193
)
(457
)
Debt issuance costs
-
(3
)
-
(3
)
Proceeds from issuance of stock upon
exercise of stock options
1
-
3
1
Payments for repurchases and retirement of
common stock
(135
)
(50
)
(310
)
(200
)
Payments for taxes related to shares
withheld for employee taxes
(1
)
(1
)
(9
)
(34
)
Distributions to noncontrolling
shareholders
(8
)
(35
)
(36
)
(41
)
Acquisitions of noncontrolling interests
in subsidiaries
(44
)
(6
)
(255
)
(19
)
Net cash provided by (used in) financing
activities
(41
)
248
(306
)
307
Effect of exchange rate changes on cash
and cash equivalents
(31
)
18
(11
)
18
Net change in cash and cash
equivalents
(12
)
29
(45
)
49
Cash and cash equivalents, beginning of
period
138
137
171
117
Cash and cash equivalents, end of
period
$
126
$
166
$
126
$
166
Exhibit A - Third Quarter Sales
Henry Schein, Inc.
2024 Third Quarter
Sales Summary
(in millions)
(unaudited)
Q3 2024
over Q3 2023
Local Currency Growth
Global
Q3 2024
Q3 2023
Local Internal Growth
Acquisition Growth
Total Local Currency
Growth
Foreign Exchange
Impact
Total Sales Growth
Dental Merchandise
$
1,424
$
1,465
-2.5
%
0.3
%
-2.2
%
-0.6
%
-2.8
%
Dental Equipment
428
417
1.8
%
0.9
%
2.7
%
0.1
%
2.8
%
Total Dental
1,852
1,882
-1.6
%
0.5
%
-1.1
%
-0.5
%
-1.6
%
Medical
1,101
1,070
-4.8
%
7.6
%
2.8
%
0.1
%
2.9
%
Total Health Care Distribution
2,953
2,952
-2.7
%
3.0
%
0.3
%
-0.3
%
0.0
%
Technology and Value-Added Services
221
210
-1.1
%
6.0
%
4.9
%
0.2
%
5.1
%
Total Global
$
3,174
$
3,162
-2.6
%
3.2
%
0.6
%
-0.2
%
0.4
%
Local Currency Growth
North
America
Q3 2024
Q3 2023
Local Internal Growth
Acquisition Growth
Total Local Currency
Growth
Foreign Exchange
Impact
Total Sales Growth
Dental Merchandise
$
823
$
866
-4.9
%
0.1
%
-4.8
%
-0.2
%
-5.0
%
Dental Equipment
266
268
-0.3
%
0.0
%
-0.3
%
-0.3
%
-0.6
%
Total Dental
1,089
1,134
-3.8
%
0.0
%
-3.8
%
-0.1
%
-3.9
%
Medical
1,076
1,044
-4.8
%
7.8
%
3.0
%
0.0
%
3.0
%
Total Health Care Distribution
2,165
2,178
-4.3
%
3.8
%
-0.5
%
-0.1
%
-0.6
%
Technology and Value-Added Services
190
185
-3.1
%
5.4
%
2.3
%
0.0
%
2.3
%
Total North America
$
2,355
$
2,363
-4.2
%
3.9
%
-0.3
%
-0.1
%
-0.4
%
Local Currency Growth
International
Q3 2024
Q3 2023
Local Internal Growth
Acquisition Growth
Total Local Currency
Growth
Foreign Exchange
Impact
Total Sales Growth
Dental Merchandise
$
601
$
599
0.9
%
0.7
%
1.6
%
-1.3
%
0.3
%
Dental Equipment
162
149
5.6
%
2.4
%
8.0
%
0.8
%
8.8
%
Total Dental
763
748
1.8
%
1.1
%
2.9
%
-0.9
%
2.0
%
Medical
25
26
-5.9
%
0.0
%
-5.9
%
1.2
%
-4.7
%
Total Health Care Distribution
788
774
1.6
%
0.9
%
2.5
%
-0.7
%
1.8
%
Technology and Value-Added Services
31
25
13.4
%
10.6
%
24.0
%
1.4
%
25.4
%
Total International
$
819
$
799
1.9
%
1.3
%
3.2
%
-0.7
%
2.5
%
Exhibit A - Year-to-Date Sales
Henry Schein, Inc.
2024 Third Quarter
Year-to-Date
Sales Summary
(in millions)
(unaudited)
Q3 2024
Year-to-Date over Q3 2023 Year-to-Date
Local Currency Growth
Global
Q3 2024
Q3 2023
Local Internal Growth
Acquisition Growth
Total Local Currency
Growth
Foreign Exchange
Impact
Total Sales Growth
Dental Merchandise
$
4,407
$
4,466
-3.0
%
1.9
%
-1.1
%
-0.2
%
-1.3
%
Dental Equipment
1,283
1,271
0.5
%
0.4
%
0.9
%
0.0
%
0.9
%
Total Dental
5,690
5,737
-2.2
%
1.5
%
-0.7
%
-0.1
%
-0.8
%
Medical
3,140
2,991
-3.3
%
8.3
%
5.0
%
0.0
%
5.0
%
Total Health Care Distribution
8,830
8,728
-2.6
%
3.9
%
1.3
%
-0.1
%
1.2
%
Technology and Value-Added Services
652
594
1.9
%
7.7
%
9.6
%
0.1
%
9.7
%
Total Global
$
9,482
$
9,322
-2.3
%
4.1
%
1.8
%
-0.1
%
1.7
%
Local Currency Growth
North
America
Q3 2024
Q3 2023
Local Internal Growth
Acquisition Growth
Total Local Currency
Growth
Foreign Exchange
Impact
Total Sales Growth
Dental Merchandise
$
2,520
$
2,659
-5.2
%
0.1
%
-5.1
%
-0.1
%
-5.2
%
Dental Equipment
801
788
1.8
%
0.0
%
1.8
%
-0.1
%
1.7
%
Total Dental
3,321
3,447
-3.6
%
0.0
%
-3.6
%
0.0
%
-3.6
%
Medical
3,060
2,920
-3.2
%
8.0
%
4.8
%
0.0
%
4.8
%
Total Health Care Distribution
6,381
6,367
-3.4
%
3.7
%
0.3
%
-0.1
%
0.2
%
Technology and Value-Added Services
565
519
0.6
%
8.2
%
8.8
%
0.0
%
8.8
%
Total North America
$
6,946
$
6,886
-3.1
%
4.0
%
0.9
%
0.0
%
0.9
%
Local Currency Growth
International
Q3 2024
Q3 2023
Local Internal Growth
Acquisition Growth
Total Local Currency
Growth
Foreign Exchange
Impact
Total Sales Growth
Dental Merchandise
$
1,887
$
1,807
0.3
%
4.5
%
4.8
%
-0.4
%
4.4
%
Dental Equipment
482
483
-1.5
%
0.9
%
-0.6
%
0.3
%
-0.3
%
Total Dental
2,369
2,290
-0.1
%
3.8
%
3.7
%
-0.3
%
3.4
%
Medical
80
71
-5.7
%
18.1
%
12.4
%
0.0
%
12.4
%
Total Health Care Distribution
2,449
2,361
-0.2
%
4.2
%
4.0
%
-0.3
%
3.7
%
Technology and Value-Added Services
87
75
11.0
%
4.0
%
15.0
%
1.4
%
16.4
%
Total International
$
2,536
$
2,436
0.1
%
4.2
%
4.3
%
-0.2
%
4.1
%
Exhibit B
Henry Schein, Inc.
2024 Third Quarter
Reconciliation of reported
GAAP net income and diluted EPS attributable to Henry Schein,
Inc.
to non-GAAP net income and
diluted EPS attributable to Henry Schein, Inc.
(in millions, except per share
data)
(unaudited)
Third Quarter
Year-to-Date
%
%
2024
2023
Growth
2024
2023
Growth
Net income attributable to Henry
Schein, Inc.
$
99
$
137
(27.8
)
%
$
296
$
398
(25.7
)
%
Diluted EPS attributable to Henry
Schein, Inc.
$
0.78
$
1.05
(25.7
)
%
$
2.30
$
3.02
(23.8
)
%
Non-GAAP Adjustments, net of tax and
attribution to noncontrolling interests
Restructuring costs (1)
$
33
$
8
$
51
$
42
Acquisition intangible amortization
(2)
29
27
85
66
Cyber incident-insurance proceeds, net of
third-party advisory expenses (3)
(6
)
-
(8
)
-
Change in contingent consideration (4)
-
-
28
-
Litigation settlements (5)
-
-
4
-
Non-GAAP adjustments to net
income
$
56
$
35
$
160
$
108
Non-GAAP adjustments to diluted
EPS
0.43
0.27
1.24
0.82
Non-GAAP net income attributable to
Henry Schein, Inc.
$
155
$
173
(10.8
)
%
$
456
$
507
(10.1
)
%
Non-GAAP diluted EPS attributable to
Henry Schein, Inc.
$
1.22
$
1.32
(7.6
)
%
$
3.55
$
3.84
(7.6
)
%
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. Net income growth rates are based on actual values
and may not recalculate due to rounding. Amounts may not sum due to
rounding.
(1)
Restructuring
Costs
The following table presents details of
our restructuring costs:
Third Quarter
Full Year
2024
2023
2024
2023
Restructuring costs - pre-tax, as
reported
$
48
$
11
$
73
59
Income tax benefit
(12
)
(3
)
(18
)
(15
)
Amount attributable to noncontrolling
interests
(3
)
-
(4
)
(2
)
Restructuring costs, net
$
33
$
8
$
51
$
42
Q3 2024 restructuring costs primarily consisted of employee
severance and costs related to the exit of facilities.
(2)
Acquisition
Intangible Amortization
The following table presents details of
amortization of acquired intangible assets:
Third Quarter
Full Year
2024
2023
2024
2023
Acquisition intangible amortization -
pre-tax, as reported
$
47
$
44
$
140
108
Income tax benefit
(12
)
(11
)
(35
)
(27
)
Amount attributable to noncontrolling
interests
(6
)
(6
)
(20
)
(15
)
Acquisition intangible amortization,
net
$
29
$
27
$
85
$
66
(3)
Represents cyber insurance proceeds, net
of one time professional and other fees related to remediation of
our Q4 2023 cyber incident. During Q3 2024 and YTD 2024 , we
received insurance proceeds of $10 million ($7 million, net of
taxes) and $20 million ($15 million, net of taxes), respectively,
representing a partial insurance recovery of losses related to the
cyber incident. One time professional and other fees were $1
million ($1 million, net of taxes) and $9 million ($7 million, net
of taxes), for Q3 2024 and YTD 2024, respectively.
(4)
Represents a change in the fair value of
contingent consideration of $38 million ($28 million, net of taxes)
recorded during YTD 2024 related to a 2023 acquisition.
(5)
Represents settlement amounts for
litigation related to the October 2023 cyber incident and
settlement of certain opioid related lawsuits during YTD 2024.
Exhibit C
Henry Schein, Inc.
2024 Third Quarter
Reconciliation of reported
GAAP net income to Adjusted EBITDA
(in millions)
(unaudited)
Third Quarter
Full Year
2024
2023
2024
2023
Net income attributable to Henry
Schein, Inc. (GAAP)
$
99
$
137
$
296
398
Income attributable to noncontrolling
interests
-
6
6
21
Net income (GAAP)
99
143
302
419
Definitional adjustments:
Interest income
(7
)
(6
)
(18
)
(12
)
Interest expense
34
25
96
58
Income taxes
32
39
97
119
Depreciation and amortization
74
69
221
180
Non-GAAP adjustments:
Restructuring costs
48
11
73
59
Cyber incident-insurance proceeds, net of
third-party advisory expenses
(9
)
-
(11
)
-
Change in contingent consideration
-
-
38
-
Litigation settlements
-
-
5
-
Other adjustments:
Equity in earnings of affiliates, net of
tax
(3
)
(3
)
(12
)
(10
)
Adjusted EBITDA (non-GAAP)
$
268
$
278
$
791
$
813
Adjusted EBITDA is a non-GAAP measure that
we calculate in the manner reflected on Exhibit C. We define
Adjusted EBITDA as net income, excluding (i) net income
attributable to noncontrolling interests, (ii) interest income and
expense, (iii) income taxes, (iv) depreciation and amortization,
(v) restructuring costs, (vi) cyber incident-insurance proceeds,
net of third-party advisory expenses, (vii) change in contingent
consideration, (viii) litigation settlements, and (ix) equity in
earnings of affiliates. Amounts may not sum due to rounding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241104777524/en/
Investors Ronald N. South Senior
Vice President and Chief Financial Officer
ronald.south@henryschein.com (631) 843-5500 Graham Stanley Vice
President, Investor Relations and Strategic Financial Project
Officer graham.stanley@henryschein.com (631) 843-5500 Media Ann Marie Gothard Vice President, Global
Corporate Media Relations annmarie.gothard@henryschein.com (631)
390-8169
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