DENTSPLY SIRONA Inc. (“Dentsply Sirona” or the "Company") (Nasdaq:
XRAY) today announced its financial results for the second quarter
of 2023.
Second quarter net sales of $1,028 million
increased 0.5% (organic sales increased 2.3%), compared to $1,023
million in the second quarter of 2022. Net income for the second
quarter of 2023 was $86 million, or $0.40 per diluted share,
compared to net income of $73 million, or $0.34 per diluted share
in the second quarter of 2022. Adjusted earnings per diluted share
was $0.51 compared to $0.69 in the second quarter of 2022. A
reconciliation of Non-GAAP measures (including organic sales,
adjusted EBITDA and margin, adjusted EPS, and adjusted free cash
flow conversion) to GAAP measures is provided below.
"We are pleased with our second quarter results,
the highlight of which was organic growth in all four segments.
Notably, aligners delivered another quarter of double-digit growth
and our business in China returned to growth. We continue to see
healthy patient traffic in most key markets and are making
meaningful progress on our transformation initiatives. With this
momentum and improved confidence, we are raising our full year
outlook for net sales, organic sales growth, and adjusted EPS,"
said Simon Campion, President and Chief Executive Officer. "We are
confident that we are on the right path and are executing well on
our strategic objectives, which we expect will position us to
deliver sustainable performance over time, and translate to
significant value creation for all of our stakeholders."
Q2 23 Summary Results
(GAAP)[1]
(in millions, except per share amount and
percentages) |
|
Q2 23 |
|
Q2 22 |
|
YoY |
Net Sales |
|
$ |
1,028 |
|
|
$ |
1,023 |
|
|
|
0.5 |
% |
Net Income Attributable to Dentsply Sirona |
|
$ |
86 |
|
|
$ |
73 |
|
|
|
17.8 |
% |
Diluted (Loss)/ Earnings Per Share |
|
$ |
0.40 |
|
|
$ |
0.34 |
|
|
|
19.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentages are based on actual values and may not
reconcile due to rounding.
[1] Q2 2023 GAAP EPS includes a tax benefit due to
the partial valuation allowance release of net operating loss
carryforwards.
Q2 23 Summary Results
(Non-GAAP)[2]
(in millions, except per share amount and
percentages) |
|
Q2 23 |
|
Q2 22 |
|
YoY |
Net Sales |
|
$ |
1,028 |
|
|
$ |
1,023 |
|
|
|
0.5 |
% |
Organic Sales Growth % |
|
|
|
|
|
|
2.3 |
% |
Adjusted EBITDA |
|
$ |
184 |
|
|
$ |
235 |
|
|
|
(22.4 |
%) |
Adjusted EBITDA Margin |
|
|
17.7 |
% |
|
|
22.9 |
% |
|
|
Adjusted EPS |
|
$ |
0.51 |
|
|
$ |
0.69 |
|
|
|
(26.2 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
[2] Organic sales growth, adjusted EBITDA, and
adjusted EPS are Non-GAAP financial measures which exclude certain
items. Please refer to "Non-GAAP Financial Measures" below for a
description of these measures and to the tables at the end of this
release for a reconciliation between GAAP and Non-GAAP
measures.
Percentages are based on actual values and may not
reconcile due to rounding.
Q2 23 Segment Results
|
|
|
Connected Technology Solutions |
|
|
|
Essential Dental Solutions |
|
|
|
Orthodontic and Implant Solutions |
|
|
|
Wellspect Healthcare |
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales Growth % |
|
|
0.6 |
% |
|
|
(0.8 |
%) |
|
|
1.9 |
% |
|
|
1.1 |
% |
|
|
0.5 |
% |
Organic Sales Growth % |
|
|
2.8 |
% |
|
|
0.7 |
% |
|
|
3.7 |
% |
|
|
3.1 |
% |
|
|
2.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q2 23 Geographic Results
|
|
|
United States |
|
|
|
Europe |
|
|
|
Rest of World |
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales Growth % |
|
|
1.1 |
% |
|
|
(2.7 |
%) |
|
|
4.8 |
% |
|
|
0.5 |
% |
Organic Sales Growth % |
|
|
1.1 |
% |
|
|
(2.0 |
%) |
|
|
11.0 |
% |
|
|
2.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flow and Liquidity
Operating cash flow in the second quarter of 2023
was $104 million, a decrease compared to $173 million in the prior
year, primarily as a result of changes in working capital and
increased operating expenses. In the second quarter of 2023, the
Company paid $30 million in dividends resulting in a total of $207
million returned to shareholders through dividends and share
repurchases in the first six months of 2023. The Company had $295
million of cash and cash equivalents as of June 30, 2023.
2023 Outlook
Based on the results of the first half, the Company
is raising the midpoint of its 2023 net sales outlook by $75
million to a new range of $3.98 billion to $4.02 billion, with
anticipated organic sales growth of approximately 3%. The Company
is also raising its adjusted EPS outlook to a new range of $1.92 to
$2.02, which includes a $0.03 foreign currency translation
headwind.
Other 2023 outlook assumptions are included in the
second quarter 2023 earnings presentation posted on the Investors
section of the Dentsply Sirona website at
https://investor.dentsplysirona.com. The Company does not provide
forward-looking estimates on a GAAP basis as certain information is
not available without unreasonable effort and cannot be reasonably
estimated.
Quarterly Cash Dividend
The Company's Board of Directors declared a
quarterly cash dividend of $0.14 per share of common stock, an
indicated annual rate of $0.56 per share. The dividend is payable
on October 13, 2023, to holders of record as of September 29,
2023.
Controls and Procedures
The Company identified a material weakness in
internal control over financial reporting which did not result in a
material misstatement of the Company’s previously issued financial
statements. For more information, please refer to Item 8.01 of the
Company's Current Report on Form 8-K filed on August 2, 2023.
Conference Call/Webcast
InformationDentsply Sirona’s management team will host an
investor conference call and live webcast on August 3, 2023, at
8:30 am ET. A live webcast of the investor conference call and a
presentation related to the call will be available on the Investors
section of the Company’s website at
https://investor.dentsplysirona.com.
For those planning to participate on the call,
please register at
https://register.vevent.com/register/BI76464819520843688714b97d274d39e4.
A webcast replay of the conference call will be available on the
Investors section of the Company’s website following the call.
About Dentsply SironaDentsply
Sirona is the world’s largest manufacturer of professional dental
products and technologies, with over a century of innovation and
service to the dental industry and patients worldwide. Dentsply
Sirona develops, manufactures, and markets a comprehensive
solutions offering including dental and oral health products as
well as other consumable medical devices under a strong portfolio
of world class brands. Dentsply Sirona’s products provide
innovative, high-quality and effective solutions to advance patient
care and deliver better and safer dental care. Dentsply Sirona’s
headquarters is located in Charlotte, North Carolina. The Company’s
shares are listed in the United States on Nasdaq under the symbol
XRAY. Visit www.dentsplysirona.com for more information about
Dentsply Sirona and its products.
Contact
Information:Investors:Andrea DaleyVice President, Investor
Relations+1-704-805-1293InvestorRelations@dentsplysirona.com
Press:Marion Par-WeixlbergerVice President,
Public Relations & Corporate Communications+43 676
848414588marion.par-weixlberger@dentsplysirona.com
Forward-Looking Statements and
Associated Risks
This Press Release contains statements that do not
directly and exclusively relate to historical facts which
constitute forward-looking statements, including, statements and
projections concerning, among other things, the expected timing,
benefits and costs associated with the Company’s restructuring plan
described in this Press Release. The Company’s forward-looking
statements represent current expectations and beliefs and involve
risks and uncertainties. Actual results may differ significantly
from those projected or suggested in any forward-looking statements
and no assurance can be given that the results described in such
forward-looking statements will be achieved. Investors are
cautioned not to place undue reliance on such forward-looking
statements which speak only as of the date they are made. The
forward-looking statements are subject to numerous assumptions,
risks and uncertainties and other factors that could cause actual
results to differ materially from those described in such
statements, many of which are outside of our control. The Company
does not undertake any obligation to release publicly any revisions
to such forward-looking statements to reflect events or
circumstances occurring after the date hereof or to reflect the
occurrence of unanticipated events. Any number of factors could
cause the Company’s actual results to differ materially from those
contemplated by any forward-looking statements, including, but not
limited to, the risks associated with the following: the Company’s
ability to remain profitable in a very competitive marketplace,
which depends upon the Company’s ability to differentiate its
products and services from those of competitors; the Company’s
failure to realize assumptions and projections which may result in
the need to record additional impairment charges; the effect of
changes to the Company’s distribution channels for its products and
the failure of significant distributors of the Company to
effectively manage their inventories; the Company’s ability to
control costs and failure to realize expected benefits of cost
reduction and restructuring efforts and the Company’s failure to
anticipate and appropriately adapt to changes or trends within the
rapidly changing dental industry. Investors should carefully
consider these and other relevant factors, including those risk
factors in Part I, Item 1A, (“Risk Factors”) in the Company’s most
recent Form 10-K, including any amendments thereto, and any
updating information which may be contained in the Company’s other
filings with the SEC, when reviewing any forward-looking statement.
The Company notes these factors for investors as permitted under
the Private Securities Litigation Reform Act of 1995. Investors
should understand it is impossible to predict or identify all such
factors or risks. As such, you should not consider either the
foregoing lists, or the risks identified in the Company’s SEC
filings, to be a complete discussion of all potential risks or
uncertainties.
DENTSPLY SIRONA INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(in millions, except per share
amounts)(unaudited)
|
Three Months Ended June 30, |
Six Months Ended June 30, |
|
|
2023 |
|
|
|
2022 |
|
|
2023 |
|
|
|
2022 |
|
Net sales |
$ |
1,028 |
|
|
$ |
1,023 |
|
$ |
2,006 |
|
|
$ |
1,992 |
|
Cost of products sold |
|
478 |
|
|
|
442 |
|
|
937 |
|
|
|
890 |
|
|
|
|
|
|
|
|
Gross profit |
|
550 |
|
|
|
581 |
|
|
1,069 |
|
|
|
1,102 |
|
Selling, general, and administrative expenses |
|
416 |
|
|
|
410 |
|
|
832 |
|
|
|
786 |
|
Research and development expenses |
|
49 |
|
|
|
45 |
|
|
95 |
|
|
|
90 |
|
Restructuring and other costs |
|
5 |
|
|
|
7 |
|
|
64 |
|
|
|
10 |
|
|
|
|
|
|
|
|
Operating income |
|
80 |
|
|
|
119 |
|
|
78 |
|
|
|
216 |
|
|
|
|
|
|
|
|
Other income and expenses: |
|
|
|
|
|
|
Interest expense, net |
|
21 |
|
|
|
15 |
|
|
40 |
|
|
|
27 |
|
Other expense (income), net |
|
13 |
|
|
|
13 |
|
|
20 |
|
|
|
11 |
|
|
|
|
|
|
|
|
Income before income taxes |
|
46 |
|
|
|
91 |
|
|
18 |
|
|
|
178 |
|
(Benefit) provision for income taxes |
|
(39 |
) |
|
|
18 |
|
|
(44 |
) |
|
|
36 |
|
|
|
|
|
|
|
|
Net income |
|
85 |
|
|
|
73 |
|
|
62 |
|
|
|
142 |
|
|
|
|
|
|
|
|
Less: Net loss attributable to noncontrolling interest |
|
(1 |
) |
|
|
— |
|
|
(5 |
) |
|
|
— |
|
|
|
|
|
|
|
|
Net income attributable to Dentsply Sirona |
$ |
86 |
|
|
$ |
73 |
|
$ |
67 |
|
|
$ |
142 |
|
|
|
|
|
|
|
|
Net income per common share attributable to Dentsply Sirona: |
|
|
|
|
|
|
Basic |
$ |
0.41 |
|
|
$ |
0.34 |
|
$ |
0.31 |
|
|
$ |
0.66 |
|
Diluted |
$ |
0.40 |
|
|
$ |
0.34 |
|
$ |
0.31 |
|
|
$ |
0.66 |
|
|
|
|
|
|
|
|
Weighted average common shares outstanding: |
|
|
|
|
|
|
Basic |
|
211.9 |
|
|
|
214.9 |
|
|
213.2 |
|
|
|
215.9 |
|
Diluted |
|
213.1 |
|
|
|
215.3 |
|
|
214.4 |
|
|
|
216.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DENTSPLY SIRONA INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE
SHEETS(in millions)(unaudited)
|
June 30, 2023 |
|
December 31, 2022 |
|
|
|
|
Assets |
|
|
|
Current Assets: |
|
|
|
Cash and cash equivalents |
$ |
295 |
|
|
$ |
365 |
|
Accounts and notes receivables-trade, net |
|
670 |
|
|
|
632 |
|
Inventories, net |
|
657 |
|
|
|
627 |
|
Prepaid expenses and other current assets |
|
298 |
|
|
|
269 |
|
Total Current Assets |
|
1,920 |
|
|
|
1,893 |
|
|
|
|
|
Property, plant, and equipment, net |
|
772 |
|
|
|
761 |
|
Operating lease right-of-use assets, net |
|
191 |
|
|
|
200 |
|
Identifiable intangible assets, net |
|
1,808 |
|
|
|
1,903 |
|
Goodwill |
|
2,703 |
|
|
|
2,688 |
|
Other noncurrent assets |
|
256 |
|
|
|
198 |
|
Total Assets |
$ |
7,650 |
|
|
$ |
7,643 |
|
|
|
|
|
Liabilities and Equity |
|
|
|
Current Liabilities: |
|
|
|
Accounts payable |
$ |
265 |
|
|
$ |
279 |
|
Accrued liabilities |
|
728 |
|
|
|
727 |
|
Income taxes payable |
|
17 |
|
|
|
46 |
|
Notes payable and current portion of long-term debt |
|
261 |
|
|
|
118 |
|
Total Current Liabilities |
|
1,271 |
|
|
|
1,170 |
|
|
|
|
|
Long-term debt |
|
1,841 |
|
|
|
1,826 |
|
Operating lease liabilities |
|
144 |
|
|
|
149 |
|
Deferred income taxes |
|
261 |
|
|
|
287 |
|
Other noncurrent liabilities |
|
431 |
|
|
|
399 |
|
Total Liabilities |
|
3,948 |
|
|
|
3,831 |
|
|
|
|
|
Total Equity |
|
3,702 |
|
|
|
3,812 |
|
|
|
|
|
Total Liabilities and Equity |
$ |
7,650 |
|
|
$ |
7,643 |
|
|
|
|
|
DENTSPLY SIRONA INC. AND
SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH
FLOWS(in millions)(unaudited)
|
Six Months Ended June 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
Cash flows from operating activities: |
|
|
|
Net income |
$ |
62 |
|
|
$ |
142 |
|
|
|
|
|
Adjustments to reconcile net (loss) income to net cash provided by
operating activities: |
|
|
|
Depreciation |
|
64 |
|
|
|
59 |
|
Amortization of intangible assets |
|
106 |
|
|
|
108 |
|
Deferred income taxes |
|
(83 |
) |
|
|
(13 |
) |
Stock based compensation expense |
|
31 |
|
|
|
33 |
|
Restructuring and other costs |
|
42 |
|
|
|
(3 |
) |
Other non-cash expense |
|
36 |
|
|
|
29 |
|
Changes in operating assets and liabilities, net of
acquisitions: |
|
|
|
Accounts and notes receivable-trade, net |
|
(38 |
) |
|
|
53 |
|
Inventories, net |
|
(32 |
) |
|
|
(95 |
) |
Prepaid expenses and other current assets |
|
(40 |
) |
|
|
(39 |
) |
Other noncurrent assets |
|
(1 |
) |
|
|
(6 |
) |
Accounts payable |
|
(15 |
) |
|
|
49 |
|
Accrued liabilities |
|
(44 |
) |
|
|
(44 |
) |
Income taxes |
|
(34 |
) |
|
|
2 |
|
Other noncurrent liabilities |
|
29 |
|
|
|
(9 |
) |
Net cash provided by operating activities |
|
83 |
|
|
|
266 |
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
Capital expenditures |
|
(72 |
) |
|
|
(85 |
) |
Cash received on derivative contracts |
|
4 |
|
|
|
5 |
|
Other investing activities |
|
1 |
|
|
|
(3 |
) |
Net cash used in investing activities |
|
(67 |
) |
|
|
(83 |
) |
|
|
|
|
Cash flows from financing activities: |
|
|
|
Cash paid for treasury stock |
|
(150 |
) |
|
|
(150 |
) |
Proceeds on short-term borrowings |
|
143 |
|
|
|
38 |
|
Cash dividends paid |
|
(57 |
) |
|
|
(51 |
) |
Proceeds from long-term borrowings, net of deferred financing
costs |
|
— |
|
|
|
5 |
|
Repayments on long-term borrowings |
|
(1 |
) |
|
|
(2 |
) |
Proceeds from exercised stock options |
|
— |
|
|
|
6 |
|
Other financing activities, net |
|
(5 |
) |
|
|
(8 |
) |
Net cash used in financing activities |
|
(70 |
) |
|
|
(162 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
(16 |
) |
|
|
2 |
|
Net (decrease) increase in cash and cash equivalents |
|
(70 |
) |
|
|
23 |
|
Cash and cash equivalents at beginning of period |
|
365 |
|
|
|
339 |
|
Cash and cash equivalents at end of period |
$ |
295 |
|
|
$ |
362 |
|
|
|
|
|
|
|
|
|
Non-GAAP Financial Measures
In addition to results determined in accordance
with U.S. generally accepted accounting principles (“US GAAP”) the
Company provides certain measures in this press release, described
below, which are not calculated in accordance with US GAAP and
therefore represent Non-GAAP measures. These Non-GAAP measures may
differ from those used by other companies and should not be
considered in isolation from, or as a substitute for, measures of
financial performance prepared in accordance with US GAAP. These
Non-GAAP measures are used by the Company to measure its
performance and may differ from those used by other companies.
Management believes that these Non-GAAP measures
are helpful as they provide a measure of the results of operations,
and are frequently used by investors and analysts to evaluate the
Company’s performance exclusive of certain items that impact the
comparability of results from period to period, and which may not
be indicative of past or future performance of the Company.
Organic Sales
The Company defines "organic sales" as the reported
net sales adjusted for: (1) net sales from acquired businesses
recorded prior to the first anniversary of the acquisition; (2) net
sales attributable to disposed businesses or discontinued product
lines in both the current and prior year periods; and (3) the
impact of foreign currency changes, which is calculated by
translating current period net sales using the comparable prior
period's foreign currency exchange rates.
Adjusted Operating Income
Adjusted operating income is computed by excluding
the following items from operating income (loss) as reported in
accordance with US GAAP:
(1) Business combination
related costs and fair value adjustments. These adjustments include
costs related to consummating and integrating acquired businesses,
as well as net gains and losses related to the disposed businesses.
In addition, this category includes the post-acquisition roll-off
of fair value adjustments recorded related to business
combinations, except for amortization expense of purchased
intangible assets noted below. Although the Company is regularly
engaged in activities to find and act on opportunities for
strategic growth and enhancement of product offerings, the costs
associated with these activities may vary significantly between
periods based on the timing, size and complexity of acquisitions
and as such may not be indicative of past and future performance of
the Company.
(2) Restructuring
related charges and other costs. These adjustments include costs
related to the implementation of restructuring initiatives,
including but not limited to, severance costs, facility closure
costs, and lease and contract termination costs, as well as related
professional service costs associated with these restructuring
initiatives and global transformation activity. The Company is
continually seeking to take actions that could enhance its
efficiency; consequently, restructuring charges may recur but are
subject to significant fluctuations from period to period due to
the varying levels of restructuring activity, and as such may not
be indicative of past and future performance of the Company. Other
costs include charges related to goodwill and intangible asset
impairments, legal settlements, executive separation costs, and
changes in accounting principle recorded within the period. This
category also includes costs related to the recent investigations,
related ongoing legal matters and associated remediation activities
which primarily include legal, accounting and other professional
service fees, as well as turnover and other employee-related
costs.
(3) Amortization of
purchased intangible assets. This adjustment excludes the periodic
amortization expense related to purchased intangible assets, which
are recorded at fair value. Although these costs contribute to
revenue generation and will recur in future periods, their amounts
are significantly impacted by the timing and size of acquisitions,
and as such may not be indicative of the future performance of the
Company.
(4) Fair value and
credit risk adjustments. These adjustments include the non-cash
mark-to-market changes in fair value associated with pension assets
and obligations, and equity-method investments. Although these
adjustments are recurring in nature, they are subject to
significant fluctuations from period to period due to changes in
the underlying assumptions and market conditions. The non-service
component of pension expense is a recurring item, however it is
subject to significant fluctuations from period to period due to
changes in actuarial assumptions, interest rates, plan changes,
settlements, curtailments, and other changes in facts and
circumstances. As such, these items may not be indicative of past
and future performance of the Company.
Adjusted Net Income (Loss)
Adjusted net income (loss) consists of net income
(loss) as reported in accordance with US GAAP, adjusted to exclude
the items identified above. Additionally, income tax expense is
adjusted for the related income tax impacts of the items named
above, as well as other adjustments such as: discrete adjustments
to valuation allowances and other uncertain tax positions, final
settlement of income tax audits, discrete tax items resulting from
the implementation of restructuring initiatives and the windfall or
shortfall relating to exercise of employee share-based
compensation, any difference between the interim and annual
effective tax rate, and adjustments relating to prior periods.
These adjustments are irregular in timing, and the
variability in amounts may not be indicative of past and future
performance of the Company and therefore are excluded for
comparability purposes.
Adjusted EBITDA and Margin
In addition to the adjustments described above in
arriving at adjusted net income, adjusted EBITDA is computed by
further excluding any remaining interest expense, net, income tax
expense, depreciation and amortization.
Adjusted EBITDA margin is calculated by dividing
adjusted EBITDA by net sales.
Adjusted Earnings (Loss) Per Diluted Share
Adjusted earnings (loss) (EPS) per diluted share is
computed by dividing adjusted earnings (loss) attributable to
Dentsply Sirona shareholders by the diluted weighted average number
of common shares outstanding.
Adjusted Free Cash Flow Conversion
The Company defines adjusted free cash flow as net
cash provided by operating activities minus capital expenditures
during the same period, and adjusted free cash flow conversion is
defined as adjusted free cash flow divided by adjusted net income
(loss). Management believes this Non-GAAP measure is important for
use in evaluating the Company’s financial performance as it
measures our ability to efficiently generate cash from our business
operations relative to earnings. It should be considered in
addition to, rather than as a substitute for, net income (loss) as
a measure of our performance or net cash provided by operating
activities as a measure of our liquidity.
DENTSPLY SIRONA INC. AND
SUBSIDIARIES(In millions, except
percentages)(unaudited)
A reconciliation of reported net sales to organic
sales by geographic region is as follows:
|
|
Three Months Ended June 30, 2023 |
|
Q2 2023 Change |
|
Three Months Ended June 30, 2022 |
(in millions, except percentages) |
|
U.S. |
Europe |
ROW |
Total |
|
U.S. |
Europe |
ROW |
Total |
|
U.S. |
Europe |
ROW |
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
$ |
362 |
$ |
403 |
$ |
263 |
$ |
1,028 |
|
1.1 |
% |
(2.7 |
%) |
4.8 |
% |
0.5 |
% |
|
$ |
358 |
$ |
414 |
$ |
251 |
$ |
1,023 |
Foreign exchange impact |
|
|
|
|
|
|
— |
% |
(0.7 |
%) |
(6.2 |
%) |
(1.8 |
%) |
|
|
|
|
|
Organic sales |
|
|
|
|
|
|
1.1 |
% |
(2.0 |
%) |
11.0 |
% |
2.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentages are based on actual values and may
not reconcile due to rounding.
A reconciliation of reported net sales to organic
sales by segment is as follows:
|
|
Three Months Ended June 30, 2023 |
|
Q2 2023 Change |
|
Three Months Ended June 30, 2022 |
(in millions, except percentages) |
|
Connected Technology Solutions |
Essential Dental Solutions |
Orthodontic and Implant Solutions |
Wellspect Healthcare |
Total |
|
Connected Technology Solutions |
Essential Dental Solutions |
Orthodontic and Implant Solutions |
Wellspect Healthcare |
Total |
|
Connected Technology Solutions |
Essential Dental Solutions |
Orthodontic and Implant Solutions |
Wellspect Healthcare |
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
$ |
309 |
$ |
377 |
$ |
270 |
$ |
72 |
$ |
1,028 |
|
0.6 |
% |
(0.8 |
%) |
1.9 |
% |
1.1 |
% |
0.5 |
% |
|
$ |
307 |
$ |
380 |
$ |
264 |
$ |
72 |
$ |
1,023 |
Foreign exchange impact |
|
|
|
|
|
|
|
(2.2 |
%) |
(1.5 |
%) |
(1.8 |
%) |
(2.0 |
%) |
(1.8 |
%) |
|
|
|
|
|
|
Organic sales |
|
|
|
|
|
|
|
2.8 |
% |
0.7 |
% |
3.7 |
% |
3.1 |
% |
2.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentages are based on actual values and may
not reconcile due to rounding.
DENTSPLY SIRONA INC. AND
SUBSIDIARIES(In millions, except
percentages)(unaudited)
For the three months ended June 30, 2023, a
reconciliation of selected items as reported in the Condensed
Consolidated Statements of Operations to adjusted Non-GAAP items is
as follows:
|
|
|
|
|
|
|
|
|
|
GAAP |
|
|
|
|
|
|
ADJUSTED NON-GAAP |
(in
millions, except per share amounts and percentages) |
Three Months Ended June 30, 2023 |
Amortization of Purchased Intangible Assets |
Restructuring Related Charges and Other Costs
(a) |
Business Combination Related Costs and Fair Value
Adjustments |
Tax Impact of Non-GAAP Adjustments |
Income Tax Related Adjustments |
Total Non-GAAP Adjustments |
Three Months Ended June 30, 2023 |
|
|
|
|
|
|
|
|
|
NET SALES |
$ |
1,028 |
|
— |
|
— |
|
— |
|
|
|
$ |
— |
|
$ |
1,028 |
|
GROSS PROFIT |
|
550 |
|
30 |
|
3 |
|
1 |
|
|
|
|
34 |
|
|
584 |
|
% OF NET SALES |
|
53.5 |
% |
|
|
|
|
|
|
|
56.8 |
% |
SELLING, GENERAL, AND
ADMINISTRATIVE EXPENSES |
|
416 |
|
(23 |
) |
(11 |
) |
(6 |
) |
|
|
|
(40 |
) |
|
376 |
|
% OF NET SALES |
|
40.5 |
% |
|
|
|
|
|
|
|
36.7 |
% |
RESEARCH AND DEVELOPMENT
EXPENSES |
|
49 |
|
— |
|
(1 |
) |
— |
|
|
|
|
(1 |
) |
|
48 |
|
% OF NET SALES |
|
4.7 |
% |
|
|
|
|
|
|
|
4.6 |
% |
RESTRUCTURING AND OTHER
COSTS |
|
5 |
|
— |
|
(5 |
) |
— |
|
|
|
|
(5 |
) |
|
— |
|
OPERATING INCOME |
|
80 |
|
53 |
|
20 |
|
7 |
|
— |
— |
|
80 |
|
|
160 |
|
% OF NET SALES |
|
7.8 |
% |
|
|
|
|
|
|
|
15.6 |
% |
OTHER INCOME AND EXPENSE |
|
34 |
|
— |
|
— |
|
(3 |
) |
|
|
|
(3 |
) |
|
31 |
|
INCOME BEFORE INCOME
TAXES |
|
46 |
|
53 |
|
20 |
|
10 |
|
— |
— |
|
83 |
|
|
129 |
|
(BENEFIT) PROVISION FOR INCOME
TAXES |
|
(39 |
) |
|
|
|
31 |
29 |
|
60 |
|
|
21 |
|
% OF PRE-TAX INCOME |
|
(83.2 |
%) |
|
|
|
|
|
|
|
16.4 |
% |
LESS: NET INCOME ATTRIBUTABLE
TO NONCONTROLLING INTERESTS |
|
(1 |
) |
|
|
|
|
|
|
— |
|
|
(1 |
) |
NET INCOME ATTRIBUTABLE TO
DENTSPLY SIRONA |
$ |
86 |
|
|
|
|
|
|
$ |
23 |
|
$ |
109 |
|
% OF NET SALES |
|
8.4 |
% |
|
|
|
|
|
|
|
10.6 |
% |
EARNINGS PER SHARE -
DILUTED |
$ |
0.40 |
|
|
|
|
|
|
$ |
0.11 |
|
$ |
0.51 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentages are based on actual values and may not reconcile due
to rounding.
(a) Other Costs includes $4 million in
professional service costs related to the global transformation
project, and $7 million in costs related to the recent
investigation and remediation activities which are comprised of
professional fees and other employee-related SG&A expenses.
For the three months ended June 30, 2023, the
following table presents the details of the "Restructuring Related
Charges and Other Costs" column in the above table and the line
item in the Consolidated Statements of Operations where they have
been recorded:
(in millions) |
|
Costs Related to Restructuring Plans |
|
Professional Services Costs |
|
Incentive Compensation |
|
Other |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
Cost of products sold |
|
$ |
— |
|
|
$ |
2 |
|
|
$ |
— |
|
|
$ |
1 |
|
|
$ |
3 |
|
Selling, general, and administrative expenses |
|
|
— |
|
|
|
7 |
|
|
|
2 |
|
|
|
2 |
|
|
|
11 |
|
Research and development expenses |
|
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
— |
|
|
|
1 |
|
Restructuring and other costs |
|
|
5 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5 |
|
Total |
|
$ |
5 |
|
|
$ |
10 |
|
|
$ |
2 |
|
|
$ |
3 |
|
|
$ |
20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DENTSPLY SIRONA INC. AND
SUBSIDIARIES(In millions, except
percentages)(unaudited)
For the three months ended June 30, 2022, a
reconciliation of selected items as reported in the Condensed
Consolidated Statements of Operations to adjusted Non-GAAP items is
as follows:
|
GAAP |
|
|
|
|
|
|
|
ADJUSTED NON-GAAP |
(in
millions, except per share amounts and percentages) |
Three Months Ended June 30, 2022 |
Amortization of Purchased Intangible Assets |
Restructuring Related Charges and Other Costs
(a) |
Business Combination Related Costs and Fair Value
Adjustments |
Fair Value and Credit Risk Adjustments |
Tax Impact of Non-GAAP Adjustments |
Income Tax Related Adjustments |
Total Non-GAAP Adjustments |
Three Months Ended June 30, 2022 |
|
|
|
|
|
|
|
|
|
|
NET SALES |
$ |
1,023 |
|
— |
|
— |
|
— |
|
— |
|
|
|
$ |
— |
|
$ |
1,023 |
|
GROSS PROFIT |
|
581 |
|
31 |
|
— |
|
— |
|
— |
|
|
|
|
31 |
|
|
612 |
|
% OF NET SALES |
|
56.7 |
% |
|
|
|
|
|
|
|
|
59.8 |
% |
SELLING, GENERAL, AND
ADMINISTRATIVE EXPENSES |
|
410 |
|
(22 |
) |
(27 |
) |
(1 |
) |
— |
|
|
|
|
(50 |
) |
|
360 |
|
% OF NET SALES |
|
40.0 |
% |
|
|
|
|
|
|
|
|
35.2 |
% |
RESEARCH AND DEVELOPMENT
EXPENSES |
|
45 |
|
— |
|
— |
|
— |
|
— |
|
|
|
|
— |
|
|
45 |
|
% OF NET SALES |
|
4.5 |
% |
|
|
|
|
|
|
|
|
4.4 |
% |
RESTRUCTURING AND OTHER
COSTS |
|
7 |
|
— |
|
(7 |
) |
— |
|
— |
|
|
|
|
(7 |
) |
|
— |
|
OPERATING INCOME |
|
119 |
|
53 |
|
34 |
|
1 |
|
— |
|
|
|
|
88 |
|
|
207 |
|
% OF NET SALES |
|
11.6 |
% |
|
|
|
|
|
|
|
|
20.2 |
% |
OTHER INCOME AND EXPENSE |
|
28 |
|
— |
|
— |
|
— |
|
(12 |
) |
|
|
|
(12 |
) |
|
16 |
|
INCOME BEFORE INCOME
TAXES |
|
91 |
|
53 |
|
34 |
|
1 |
|
12 |
|
|
|
|
100 |
|
|
191 |
|
PROVISION FOR INCOME
TAXES |
|
18 |
|
|
|
|
|
21 |
3 |
|
24 |
|
|
42 |
|
% OF PRE-TAX INCOME |
|
19.3 |
% |
|
|
|
|
|
|
|
|
22.2 |
% |
LESS: NET INCOME ATTRIBUTABLE
TO NON-CONTROLLING INTERESTS |
|
— |
|
|
|
|
|
|
|
|
— |
|
|
— |
|
NET INCOME ATTRIBUTABLE TO
DENTSPLY SIRONA |
$ |
73 |
|
|
|
|
|
|
|
$ |
76 |
|
$ |
149 |
|
% OF NET SALES |
|
7.1 |
% |
|
|
|
|
|
|
|
|
14.5 |
% |
EARNINGS PER SHARE -
DILUTED |
$ |
0.34 |
|
|
|
|
|
|
|
$ |
0.35 |
|
$ |
0.69 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentages are based on actual values and may not
reconcile due to rounding.(a) Other Costs include $25 million in
expenses related to the internal investigation comprised of $6
million in professional service fees and $19 million in turnover
and other employee-related SG&A expenses.
For the three months ended June 30, 2022, the
following table presents the details of the "Restructuring Related
Charges and Other Costs" column in the above table and the line
item in the Consolidated Statements of Operations where they have
been recorded:
(in millions) |
|
Severance Costs Related to Executives |
|
Costs Related to Restructuring Plans |
|
Professional Services Costs |
|
Incentive Compensation |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
Selling, general, and administrative expenses |
|
$ |
16 |
|
|
$ |
— |
|
|
$ |
7 |
|
|
$ |
4 |
|
|
$ |
27 |
|
Restructuring and other costs |
|
|
— |
|
|
|
7 |
|
|
|
— |
|
|
|
— |
|
|
|
7 |
|
Total |
|
$ |
16 |
|
|
$ |
7 |
|
|
$ |
7 |
|
|
$ |
4 |
|
|
$ |
34 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A reconciliation of reported net income (loss)
attributable to Dentsply Sirona to adjusted EBITDA and margin for
the three months ended June 30, 2023 and 2022 is as
follows:
|
|
Three Months Ended June 30, |
(in millions, except percentages) |
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
Net income attributable to Dentsply Sirona |
|
$ |
86 |
|
|
$ |
73 |
|
Interest expense, net |
|
|
21 |
|
|
|
15 |
|
Income tax expense |
|
|
(39 |
) |
|
|
18 |
|
Depreciation(1) |
|
|
33 |
|
|
|
29 |
|
Amortization of purchased intangible assets |
|
|
53 |
|
|
|
53 |
|
Restructuring related charges and other costs |
|
|
20 |
|
|
|
34 |
|
Business combination related costs and fair value adjustments |
|
|
10 |
|
|
|
1 |
|
Fair value and credit risk adjustments |
|
|
— |
|
|
|
12 |
|
Adjusted EBITDA |
|
$ |
184 |
|
|
$ |
235 |
|
|
|
|
|
|
Net sales |
|
$ |
1,028 |
|
|
$ |
1,023 |
|
Adjusted EBITDA margin |
|
|
17.7 |
% |
|
|
22.9 |
% |
|
|
|
|
|
|
|
|
|
(1) Excludes those depreciation related amounts
which were included as part of the business combination related
adjustments above.
A reconciliation of adjusted free cash flow
conversion for the three months ended June 30, 2023 and 2022
is as follows:
|
|
Three Months Ended June 30, |
(in millions, except percentages) |
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
Net cash provided by operating activities |
|
$ |
104 |
|
|
$ |
173 |
|
Capital expenditures |
|
|
(33 |
) |
|
|
(41 |
) |
Adjusted free cash flow |
|
$ |
71 |
|
|
$ |
132 |
|
|
|
|
|
|
Adjusted net income |
|
$ |
109 |
|
|
$ |
149 |
|
Adjusted free cash flow conversion |
|
|
65 |
% |
|
|
89 |
% |
|
|
|
|
|
|
|
|
|
DENTSPLY SIRONA (NASDAQ:XRAY)
Gráfica de Acción Histórica
De May 2024 a Jun 2024
DENTSPLY SIRONA (NASDAQ:XRAY)
Gráfica de Acción Histórica
De Jun 2023 a Jun 2024