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PATTERSON COMPANIES, INC.[PDCO]
Date Filed : Dec 01, 2021
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Exhibit 99
PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
PATTERSON COMPANIES REPORTS FISCAL 2022
SECOND-QUARTER OPERATING RESULTS
| Reported net sales increased 6.2 percent year-over-year to $1.65 billion, and internal sales increased8.3 percent. |
| Dental segment internal sales decreased 2.0 percent year-over-year and increased 9.8 percent compared to the |
| Animal Health segment internal sales increased 16.2 percent year-over-year and increased 24.3 percent comparedto the pre-pandemic period of the second quarter of fiscal 2020. |
| Delivered second-quarter GAAP earnings of $0.49 per diluted share and adjusted earnings |
| Increased fiscal 2022 GAAP earnings guidance range to $1.69 to $1.79 per diluted share and adjusted earnings |
St. Paul, Minn. December 1, 2021 Patterson Companies, Inc. (Nasdaq: PDCO) today reported consolidated net sales of $1.65 billion (see attached Sales Summary for further details) in its fiscal second quarter ended October 30, 2021, an increaseof 6.2 percent compared to the same period last year. Internal sales, which are adjusted for the effects of currency translation, changes in product selling relationships and contributions from recent acquisitions, increased 8.3 percentover the prior year.
Reported net income attributable to Patterson Companies, Inc. for the second quarter of fiscal 2022 was $48.3 million, or $0.49 perdiluted share, compared to $54.1 million, or $0.56 per diluted share, in the second quarter of fiscal 2021. Adjusted net income1 attributable to Patterson Companies, Inc., which excludes dealamortization and integration and business restructuring expenses, totaled $57.1 million for the second quarter of fiscal 2022, or $0.58 per diluted share, compared to $61.1 million in the same quarter of fiscal 2021, or $0.63 per dilutedshare. The year-over-year decline in reported and adjusted net income attributable to Patterson Companies, Inc. is primarily due to lower expenses in the prior year period associated with COVID-19. Theyear-over-year decline was partially offset by strong sales performance in the Animal Health segment during the second quarter of fiscal 2022.
Our top andbottom line results during the second quarter and first half of fiscal 2022 reflect the strong focus and execution of our team and that our value proposition continues to resonate with our customers, said Mark Walchirk, President and CEO ofPatterson Companies. Given our momentum and confidence in the business, we are increasing our adjusted EPS guidance range for fiscal 2022. We remain focused on leveraging the combined strength of Pattersons team, strategy and deep valueproposition to serve our customers, accelerate our growth and drive long-term value creation.
Patterson Dental
Reported net sales in our Dental segment for the second quarter of fiscal 2022, which represented approximately 38 percent of total company sales, were$622.2 million. Internal sales decreased 2.0 percent compared to the fiscal 2021 second quarter, including a 0.8 percent decline in consumables and a 3.0 percent decline in equipment and software. Compared to the
Patterson Animal Health
Reported net sales in our Animal Health segment forthe second quarter of fiscal 2022, which comprised approximately 62 percent of the companys total sales, were $1.0 billion. Internal sales growth of 16.2 percent was driven by continued strong performance in companion animal andadditional recovery in production animal and included 15.8 percent growth in consumables and 37.8 percent growth in equipment and software. Compared to the pre-pandemic period of the second quarterof fiscal 2020, internal sales increased 24.3 percent, including 23.5 percent growth in consumables and 72.6 percent growth in equipment and software.
PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
Balance Sheet and Capital Allocation
During the first six months of fiscal 2022, Patterson Companies used $539.0 million of cash from operating activities and collected deferred purchase pricereceivables of $585.6 million, generating $46.6 million in cash, compared to a use of cash of $14.1 million during the first six months of fiscal 2021. Free cash flow1 (seedefinition below and attached free cash flow table) during the first six months of fiscal 2022 improved by $59.6 million compared to the fiscal 2021 period due to a decreased level of working capital during fiscal 2022.
In the second quarter of fiscal 2022, Patterson Companies declared a quarterly cash dividend of $0.26 per share and returned $25.3 million in cash dividends toshareholders. Through the first six months of fiscal 2022, Patterson Companies has returned $50.4 million in cash dividends to shareholders.
Consolidated reported net sales for the first six months offiscal 2022 totaled $3.3 billion, a 16.6 percent year-over-year increase. Sales in the first six months of fiscal 2022 reflected an extra week of sales results in the fiscal first quarter versus the prior year. Internal sales, which areadjusted for the effects of currency translation, changes in product selling relationships, contributions from recent acquisitions and the extra week of selling results in the first quarter of fiscal 2022, increased 13.9 percent compared to thefirst six months of fiscal 2021. Through the first six months of fiscal 2022, Dental segment internal sales increased 10.8 percent, including 13.8 percent growth in consumables and 8.2 percent growth in equipment and software. Throughthe first six months of fiscal 2022, Animal Health segment internal sales increased 16.4 percent, including 15.7 percent growth in consumables and 42.7 percent growth in equipment and software.
Reported net income attributable to Patterson Companies, Inc. was $82.3 million, or $0.84 per diluted share, compared to a $78.5 million, or $0.82 per dilutedshare in last years period. Adjusted net income1 attributable to Patterson Companies, Inc., which excludes gains on investments, inventory donation charges, deal amortization, legal reservesand integration and business restructuring expenses totaled $99.2 million, or $1.01 per diluted share, compared to adjusted net income attributable to Patterson Companies, Inc. of $92.6 million, or $0.96 per diluted share, in the
Fiscal 2022 Guidance
Patterson Companies today updated its fiscal 2022 earnings guidance, which is provided on both a GAAP and non-GAAP adjusted
| GAAP earnings are expected to be in the range of $1.69 to $1.79 per diluted share, compared to our prior guidance of $1.64to $1.74 per diluted share. |
| Non-GAAP adjustedearnings1 are expected to be in the range of $2.00 to $2.10 per diluted share, compared to our prior guidance of $1.95 to $2.05 per diluted share. |
| Our non-GAAP adjustedearnings1 guidance excludes the after-tax impact of: |
- | Gains on investments of approximately $65.4 million ($0.67 per diluted share). |
- | Inventory donation charges of approximately $36.9 million ($0.37 per diluted share). |
- | Deal amortization expenses of approximately $29.4 million ($0.30 per diluted share). |
- | Legal reserves of approximately $27.5 million ($0.28 per diluted share). |
- | Integration and business restructuring expenses of approximately $3.2 million ($0.03 per diluted share). |
Our guidance is for current operations as well as completed or previously announced acquisitions and does not include the impact of potentialfuture acquisitions, dispositions or similar transactions, if any, or impairments and material restructurings beyond those previously publicly disclosed. Our guidance assumes North American and international market conditions remain consistent withcurrent market conditions and that there are no material adverse developments associated with the pandemic.
PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
1Non-GAAP FinancialMeasures
The Reconciliation of GAAP to non-GAAP Measures table appearing behind the accompanying financial informationis provided to adjust reported GAAP measures, namely operating income, other income (expense), net, income before taxes, income tax expense, net income, net income attributable to Patterson Companies, Inc. and diluted earnings per share attributableto Patterson Companies, Inc., for the impact of gains on investments, inventory donation charges, deal amortization, legal reserves and integration and business restructuring expenses along with the related tax effects of these items.
The term free cash flow used in this release is defined as net cash used in operating activities less capital expenditures plus the collection of deferredpurchase price receivables.
In addition, the term internal sales used in this release represents net sales adjusted to exclude the impact of foreigncurrency, changes in product selling relationships, contributions from recent acquisitions and the extra week of selling results in the first quarter of fiscal 2022. Foreign currency impact represents the difference in results that is attributableto fluctuations in currency exchange rates the company uses to convert results for all foreign entities where the functional currency is not the U.S. dollar. The company calculates the impact as the difference between the current period resultstranslated using the current period currency exchange rates and using the comparable prior periods currency exchange rates. The company believes the disclosure of net sales changes in constant currency provides useful supplementary informationto investors in light of fluctuations in currency rates.
Management believes that these non-GAAP measures may provide ahelpful representation of the companys second-quarter performance and enable comparison of financial results between periods where certain items may vary independent of business performance. Thesenon-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.
Second-Quarter Conference Call and Replay
Patterson Companies fiscal2022 second-quarter conference call will start at 8:30 a.m. Eastern today. Investors can listen to a live webcast of the conference call at www.pattersoncompanies.com. The conference call will be archived on the Patterson Companies website. A replayof the fiscal 2022 second-quarter conference call can be heard for one week at 1-800-770-2030 and by providing the Conference ID73285 when prompted.
About Patterson Companies Inc.
Patterson CompaniesInc. (Nasdaq: PDCO) connects dental and animal health customers in North America and the U.K. to the latest products, technologies, services and innovative business solutions that enable operational and professional success. Ourcomprehensive portfolio, distribution network and supply chain is equaled only by our dedicated, knowledgeable people who deliver unrivalled expertise and unmatched customer service and support.
Learn more: pattersoncompanies.com
This press release contains, and our officersand representatives may from time to time make, certain forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, including statements regarding futurefinancial performance, and the objectives and expectations of management. Forward-looking statements often include words such as believes, expects, anticipates, estimates, intends,plans, seeks or words of similar meaning, or future or conditional verbs, such as will, should, could or may.
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations andassumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherentuncertainties, risks and changes in
PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in theforward-looking statements. Therefore, you should not place undue reliance on any of these forward-looking statements.
Any number of factors could affect ouractual results and cause such results to differ materially from those contemplated by any forward-looking statements, including, but not limited to, the following: the COVID-19 pandemic and measurestaken in response thereto; our dependence on relationships with sales representatives and service technicians to retain customers and develop business; potential disruption of distribution capabilities, including service issues with third-partyshippers; our dependence on suppliers to manufacture and supply substantially all of the products we sell; the risk of the products we sell becoming obsolete or containing undetected errors; adverse changes in supplier rebates; the risk that privatelabel sales could adversely affect our relationships with suppliers; our dependence on positive perceptions of Pattersons reputation; risks inherent in acquiring and disposing of assets or other businesses and the risks inherent in integratingacquired businesses; our ability to comply with restrictive covenants in our credit agreement; our dependence on leadership development and succession planning; the risk that our governing documents and Minnesota law may discourage takeovers andbusiness combinations; the effects of the highly competitive and consolidating dental and animal health supply markets in which we compete; exposure to the risks of the animal production business, including changing consumer demand, the cyclicallivestock market, and other factors outside our control; risks from the formation of GPOs, provider networks and buying groups that may shift purchasing decisions and place us at a competitive disadvantage; increasesin over-the-counter sales and e-commerce options for companion animal products or sales of companion animalproducts from non-veterinarian sources; change and uncertainty in the health care industry, including the effects of health care reform; failure to comply with existing or future U.S. or foreign laws andregulations including those governing the distribution of pharmaceuticals and controlled substances; public concern over the abuse of opioid medication in the U.S.; failure to comply with health care fraud or other laws and regulations; litigationrisks, including the diversion of managements attention, the cost of defending against such actions, the possibility of damage awards or settlements, fines or penalties, or equitable remedies (including but not limited to the revocation of
The order in which these factors appear should not be construed to indicate their relative importance orpriority. We caution that these factors may not be exhaustive, accordingly, any forward-looking statements contained herein should not be relied upon as a prediction of actual results.
You should carefully consider these and other relevant factors, including those risk factors in Part I, Item 1A, (Risk Factors) in our most recent Form
Investors should understand it is impossible to predict or identify all such factors or risks. As such, you should not consider the foregoing list, or the risksidentified in our SEC filings, to be a complete discussion of all potential risks or uncertainties.
Any forward-looking statement made by us in this press releaseis based only on information currently available to us and speaks only as of the date on which it is made. We do not undertake any obligation to release publicly any revisions to any forward-looking statements whether written or oral, that may bemade from time to time, whether as a result of new information, future developments or otherwise.
INVESTOR CONTACT: | John M. Wright, Investor Relations | |
COMPANY: | Patterson Companies Inc. | |
TEL: | 651.686.1364 | |
EMAIL: | investor.relations@pattersoncompanies.com |
PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
MEDIA CONTACT: | Patterson Corporate Communications | |
COMPANY: | Patterson Companies Inc. | |
TEL: | 651.905.3349 | |
EMAIL: | corporate.communications@pattersoncompanies.com | |
WEB: | pattersoncompanies.com | |
SOURCE: | Patterson Companies Inc. |
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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
PATTERSON COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended | Six Months Ended | |||||||||||||||
October 30, 2021 | October 24, 2020 | October 30, 2021 | October 24, 2020 | |||||||||||||
Net sales | $ | 1,649,161 | $ | 1,553,168 | $ | 3,264,037 | $ | 2,799,005 | ||||||||
Gross profit | 326,435 | 320,368 | 604,237 | 574,184 | ||||||||||||
Operating expenses | 263,575 | 246,662 | 580,906 | 462,606 | ||||||||||||
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Operating income | 62,860 | 73,706 | 23,331 | 111,578 | ||||||||||||
Other income (expense): | ||||||||||||||||
Gains on investments | | | 87,827 | | ||||||||||||
Other income, net | 6,804 | 3,223 | 8,227 | 5,257 | ||||||||||||
Interest expense | (5,521 | ) | (6,381 | ) | (10,716 | ) | (13,072 | ) | ||||||||
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Income before taxes | 64,143 | 70,548 | 108,669 | 103,763 | ||||||||||||
Income tax expense | 16,205 | 16,722 | 26,929 | 25,735 | ||||||||||||
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Net income | 47,938 | 53,826 | 81,740 | 78,028 | ||||||||||||
Net loss attributable to noncontrolling interests | (392 | ) | (234 | ) | (586 | ) | (439 | ) | ||||||||
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Net income attributable to Patterson Companies, Inc. | $ | 48,330 | $ | 54,060 | $ | 82,326 | $ | 78,467 | ||||||||
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Earnings per share attributable to Patterson Companies, Inc.: | ||||||||||||||||
Basic | $ | 0.50 | $ | 0.57 | $ | 0.85 | $ | 0.82 | ||||||||
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Diluted | $ | 0.49 | $ | 0.56 | $ | 0.84 | $ | 0.82 | ||||||||
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Weighted average shares: | ||||||||||||||||
Basic | 97,321 | 95,518 | 97,089 | 95,341 | ||||||||||||
Diluted | 98,363 | 96,415 | 98,363 | 96,105 | ||||||||||||
Dividends declared per common share | $ | 0.26 | $ | 0.26 | $ | 0.52 | $ | 0.52 |
PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
PATTERSON COMPANIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Inthousands)
(Unaudited)
October 30, 2021 | April 24, 2021 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 154,152 | $ | 143,244 | ||||
Receivables, net | 481,844 | 449,235 | ||||||
Inventory | 830,121 | 736,778 | ||||||
Prepaid expenses and other current assets | 333,314 | 286,672 | ||||||
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Total current assets | 1,799,431 | 1,615,929 | ||||||
Property and equipment, net | 213,362 | 219,438 | ||||||
Operating lease right-of-useassets, net | 74,095 | 77,217 | ||||||
Goodwill and identifiable intangibles, net | 413,634 | 419,576 | ||||||
Long-term receivables, net and other | 402,203 | 419,351 | ||||||
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Total assets | $ | 2,902,725 | $ | 2,751,511 | ||||
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LIABILITIES AND STOCKHOLDERS EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 773,230 | $ | 609,264 | ||||
Other accrued liabilities | 244,883 | 294,400 | ||||||
Operating lease liabilities | 31,191 | 32,252 | ||||||
Current maturities of long-term debt | 100,750 | 100,750 | ||||||
Borrowings on revolving credit | 43,000 | 53,000 | ||||||
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Total current liabilities | 1,193,054 | 1,089,666 | ||||||
Long-term debt | 488,091 | 487,545 | ||||||
Non-current operating lease liabilities | 45,217 | 48,318 | ||||||
Other non-current liabilities | 164,381 | 161,311 | ||||||
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Total liabilities | 1,890,743 | 1,786,840 | ||||||
Stockholders equity | 1,011,982 | 964,671 | ||||||
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Total liabilities and stockholders equity | $ | 2,902,725 | $ | 2,751,511 | ||||
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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
PATTERSON COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Six Months Ended | ||||||||
October 30, 2021 | October 24, 2020 | |||||||
Operating activities: | ||||||||
Net income | $ | 81,740 | $ | 78,028 | ||||
Adjustments to reconcile net income to net cash used in operating activities: | ||||||||
Depreciation and amortization | 40,980 | 38,881 | ||||||
Gains on investments | (87,827 | ) | | |||||
Non-cash employee compensation | 13,497 | 16,660 | ||||||
Non-cash losses (gains) and other, net | 3,974 | 5,976 | ||||||
Change in assets and liabilities: | ||||||||
Receivables | (583,939 | ) | (505,535 | ) | ||||
Inventory | (90,728 | ) | 58,238 | |||||
Accounts payable | 165,250 | (179,276 | ) | |||||
Accrued liabilities | (56,029 | ) | 24,555 | |||||
Other changes from operating activities, net | (25,932 | ) | 39,469 | |||||
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Net cash used in operating activities | (539,014 | ) | (423,004 | ) | ||||
Investing activities: | ||||||||
Additions to property and equipment | (15,503 | ) | (14,370 | ) | ||||
Collection of deferred purchase price receivables | 585,647 | 408,907 | ||||||
Acquisitions, net of cash acquired | (19,793 | ) | | |||||
Sale of investments | 57,245 | 396 | ||||||
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Net cash provided by investing activities | 607,596 | 394,933 | ||||||
Financing activities: | ||||||||
Dividends paid | (50,407 | ) | (25,009 | ) | ||||
(Payment) draw on revolving credit | (10,000 | ) | 111,000 | |||||
Other financing activities | 1,959 | 631 | ||||||
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Net cash (used in) provided by financing activities | (58,448 | ) | 86,622 | |||||
Effect of exchange rate changes on cash | 774 | 2,986 | ||||||
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Net change in cash and cash equivalents | 10,908 | 61,537 | ||||||
Cash and cash equivalents at beginning of period | 143,244 | 77,944 | ||||||
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Cash and cash equivalents at end of period | $ | 154,152 | $ | 139,481 | ||||
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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
PATTERSON COMPANIES, INC.
SALES SUMMARY
(Dollars in thousands)
(Unaudited)
October 30, 2021 | October 24, 20201 | Total Sales Growth | Foreign Exchange Impact | 53rd Week | Other 2 | Internal Sales Growth | ||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||
Consolidated net sales | ||||||||||||||||||||||||||||
Consumable | $ | 1,344,812 | $ | 1,241,586 | 8.3 | % | 1.0 | % | | % | (3.8 | )% | 11.1 | % | ||||||||||||||
Equipment and software | 223,813 | 220,227 | 1.6 | 0.5 | | | 1.1 | |||||||||||||||||||||
Value-added services and other | 80,536 | 91,355 | (11.8 | ) | 0.7 | | (0.1 | ) | (12.4 | ) | ||||||||||||||||||
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Total | $ | 1,649,161 | $ | 1,553,168 | 6.2 | % | 0.9 | % | | % | (3.0 | )% | 8.3 | % | ||||||||||||||
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Dental | ||||||||||||||||||||||||||||
Consumable | $ | 356,654 | $ | 357,849 | (0.3 | )% | 0.5 | % | | % | | % | (0.8 | )% | ||||||||||||||
Equipment and software | 193,437 | 198,181 | (2.4 | ) | 0.6 | | | (3.0 | ) | |||||||||||||||||||
Value-added services and other | 72,124 | 75,718 | (4.7 | ) | 0.3 | | | (5.0 | ) | |||||||||||||||||||
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Total | $ | 622,215 | $ | 631,748 | (1.5 | )% | 0.5 | % | | % | | % | (2.0 | )% | ||||||||||||||
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Animal Health | ||||||||||||||||||||||||||||
Consumable | $ | 988,158 | $ | 883,737 | 11.8 | % | 1.3 | % | | % | (5.3 | )% | 15.8 | % | ||||||||||||||
Equipment and software | 30,376 | 22,046 | 37.8 | | | | 37.8 | |||||||||||||||||||||
Value-added services and other | 8,933 | 8,394 | 6.4 | 4.7 | | (1.5 | ) | 3.2 | ||||||||||||||||||||
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Total | $ | 1,027,467 | $ | 914,177 | 12.4 | % | 1.3 | % | | % | (5.1 | )% | 16.2 | % | ||||||||||||||
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Corporate | ||||||||||||||||||||||||||||
Value-added services and other | $ | (521 | ) | $ | 7,243 | n/m | | % | | % | | % | n/m | |||||||||||||||
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Total | $ | (521 | ) | $ | 7,243 | n/m | | % | | % | | % | n/m | |||||||||||||||
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1 | Certain sales were reclassified between categories to conform to the current period presentation. |
2 | Sales of certain products previously recognized on a gross basis were recognized on a net basis during the three and sixmonths ended October 30, 2021. Other represents the impact of this change in revenue recognition, as well as the impact of an acquisition on sales during the three and six months ended October 30, 2021. |
PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
October 30, 2021 | October 24, 20201 | Total Sales Growth | Foreign Exchange Impact | 53rd Week | Other2 | Internal Sales Growth | ||||||||||||||||||||||
Six Months Ended | ||||||||||||||||||||||||||||
Consolidated net sales | ||||||||||||||||||||||||||||
Consumable | $ | 2,686,486 | $ | 2,286,567 | 17.5 | % | 1.8 | % | 4.3 | % | (3.8 | )% | 15.2 | % | ||||||||||||||
Equipment and software | 407,265 | 349,658 | 16.5 | 1.0 | 3.5 | | 12.0 | |||||||||||||||||||||
Value-added services and other | 170,286 | 162,780 | 4.6 | 1.2 | 3.0 | (0.1 | ) | 0.5 | ||||||||||||||||||||
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Total | $ | 3,264,037 | $ | 2,799,005 | 16.6 | % | 1.7 | % | 4.1 | % | (3.1 | )% | 13.9 | % | ||||||||||||||
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Dental | ||||||||||||||||||||||||||||
Consumable | $ | 733,230 | $ | 614,452 | 19.3 | % | 1.0 | % | 4.5 | % | | % | 13.8 | % | ||||||||||||||
Equipment and software | 350,403 | 311,198 | 12.6 | 1.1 | 3.3 | | 8.2 | |||||||||||||||||||||
Value-added services and other | 145,449 | 136,393 | 6.6 | 0.5 | 2.9 | | 3.2 | |||||||||||||||||||||
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Total | $ | 1,229,082 | $ | 1,062,043 | 15.7 | % | 1.0 | % | 3.9 | % | | % | 10.8 | % | ||||||||||||||
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Animal Health | ||||||||||||||||||||||||||||
Consumable | $ | 1,953,256 | $ | 1,672,115 | 16.8 | % | 2.1 | % | 4.2 | % | (5.2 | )% | 15.7 | % | ||||||||||||||
Equipment and software | 56,862 | 38,460 | 47.8 | | 5.1 | | 42.7 | |||||||||||||||||||||
Value-added services and other | 20,139 | 15,755 | 27.8 | 8.0 | 5.2 | (1.2 | ) | 15.8 | ||||||||||||||||||||
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Total | $ | 2,030,257 | $ | 1,726,330 | 17.6 | % | 2.1 | % | 4.2 | % | (5.1 | )% | 16.4 | % | ||||||||||||||
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Corporate | ||||||||||||||||||||||||||||
Value-added services and other | $ | 4,698 | $ | 10,632 | (55.8 | )% | | % | | % | | % | (55.8 | )% | ||||||||||||||
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Total | $ | 4,698 | $ | 10,632 | (55.8 | )% | | % | | % | | % | (55.8 | )% | ||||||||||||||
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1 | Certain sales were reclassified between categories to conform to the current period presentation. |
2 | Sales of certain products previously recognized on a gross basis were recognized on a net basis during the three and sixmonths ended October 30, 2021. Other represents the impact of this change in revenue recognition, as well as the impact of an acquisition on sales during the three and six months ended October 30, 2021. |
PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
PATTERSON COMPANIES, INC.
OPERATING INCOME BY SEGMENT
(In thousands)
(Unaudited)
Three Months Ended | Six Months Ended | |||||||||||||||
October 30, 2021 | October 24, 2020 | October 30, 2021 | October 24, 2020 | |||||||||||||
Operating income (loss) | ||||||||||||||||
Dental | $ | 55,570 | $ | 72,957 | $ | 54,484 | $ | 110,726 | ||||||||
Animal Health | 26,135 | 17,591 | 49,940 | 34,990 | ||||||||||||
Corporate | (18,845 | ) | (16,842 | ) | (81,093 | ) | (34,138 | ) | ||||||||
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Total | $ | 62,860 | $ | 73,706 | $ | 23,331 | $ | 111,578 | ||||||||
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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
PATTERSON COMPANIES, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(Dollars in thousands, except per share amounts)
(Unaudited)
For the three months ended October 30, 2021 | GAAP | Deal amortization | Integration and business restructuring expenses | Legal reserves | Inventory donation charges | Gains on investments | Non-GAAP | |||||||||||||||||||||
Operating income | $ | 62,860 | $ | 9,614 | $ | 1,863 | $ | | $ | | $ | | $ | 74,337 | ||||||||||||||
Other income (expense), net | 1,283 | | | | | | 1,283 | |||||||||||||||||||||
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Income before taxes | 64,143 | 9,614 | 1,863 | | | | 75,620 | |||||||||||||||||||||
Income tax expense | 16,205 | 2,269 | 466 | | | | 18,940 | |||||||||||||||||||||
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Net income | 47,938 | 7,345 | 1,397 | | | | 56,680 | |||||||||||||||||||||
Net loss attributable to noncontrolling interests | (392 | ) | | | | | | (392 | ) | |||||||||||||||||||
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Net income attributable to Patterson Companies, Inc. | $ | 48,330 | $ | 7,345 | $ | 1,397 | $ | | $ | | $ | | $ | 57,072 | ||||||||||||||
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Diluted earnings per share attributable to Patterson Companies, Inc.* | $ | 0.49 | $ | 0.07 | $ | 0.01 | $ | | $ | | $ | | $ | 0.58 | ||||||||||||||
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Operating income as a % of sales | 3.8 | % | 4.5 | % | ||||||||||||||||||||||||
Effective tax rate | 25.3 | % | 25.0 | % |
For the three months ended October 24, 2020 | GAAP | Deal amortization | Integration and business restructuring expenses | Legal reserves | Inventory donation charges | Gains on investments | Non-GAAP | |||||||||||||||||||||
Operating income | $ | 73,706 | $ | 9,250 | $ | | $ | | $ | | $ | | $ | 82,956 | ||||||||||||||
Other income (expense), net | (3,158 | ) | | | | | | (3,158 | ) | |||||||||||||||||||
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Income before taxes | 70,548 | 9,250 | | | | | 79,798 | |||||||||||||||||||||
Income tax expense | 16,722 | 2,199 | | | | | 18,921 | |||||||||||||||||||||
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Net income | 53,826 | 7,051 | | | | | 60,877 | |||||||||||||||||||||
Net loss attributable to noncontrolling interests | (234 | ) | | | | | | (234 | ) | |||||||||||||||||||
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Net income attributable to Patterson Companies, Inc. | $ | 54,060 | $ | 7,051 | $ | | $ | | $ | | $ | | $ | 61,111 | ||||||||||||||
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Diluted earnings per share attributable to Patterson Companies, Inc.* | $ | 0.56 | $ | 0.07 | $ | | $ | | $ | | $ | | $ | 0.63 | ||||||||||||||
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Operating income as a % of sales | 4.7 | % | 5.3 | % | ||||||||||||||||||||||||
Effective tax rate | 23.7 | % | 23.7 | % |
* | May not sum due to rounding |
PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
PATTERSON COMPANIES, INC.
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(Dollars in thousands, except per share amounts)
(Unaudited)
For the six months ended October 30, 2021 | GAAP | Deal amortization | Integration and business restructuring expenses | Legal reserves | Inventory donation charges | Gains on investments | Non-GAAP | |||||||||||||||||||||
Operating income | $ | 23,331 | $ | 19,155 | $ | 4,245 | $ | 36,000 | $ | 49,194 | $ | | $ | 131,925 | ||||||||||||||
Other income (expense), net | 85,338 | | | | | (87,827 | ) | (2,489 | ) | |||||||||||||||||||
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Income before taxes | 108,669 | 19,155 | 4,245 | 36,000 | 49,194 | (87,827 | ) | 129,436 | ||||||||||||||||||||
Income tax expense | 26,929 | 4,506 | 1,061 | 8,460 | 12,308 | (22,396 | ) | 30,868 | ||||||||||||||||||||
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Net income | 81,740 | 14,649 | 3,184 | 27,540 | 36,886 | (65,431 | ) | 98,568 | ||||||||||||||||||||
Net loss attributable to noncontrolling interests | (586 | ) | | | | | | (586 | ) | |||||||||||||||||||
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Net income attributable to Patterson Companies, Inc. | $ | 82,326 | $ | 14,649 | $ | 3,184 | $ | 27,540 | $ | 36,886 | $ | (65,431 | ) | $ | 99,154 | |||||||||||||
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Diluted earnings per share attributable to Patterson Companies, Inc.* | $ | 0.84 | $ | 0.15 | $ | 0.03 | $ | 0.28 | $ | 0.37 | $ | (0.67 | ) | $ | 1.01 | |||||||||||||
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Operating income as a % of sales | 0.7 | % | 4.0 | % | ||||||||||||||||||||||||
Effective tax rate | 24.8 | % | 23.8 | % | ||||||||||||||||||||||||
For the six months ended October 24, 2020 | GAAP | Deal amortization | Integration and business restructuring expenses | Legal reserves | Inventory donation charges | Gains on investments | Non-GAAP | |||||||||||||||||||||
Operating income | $ | 111,578 | $ | 18,503 | $ | | $ | | $ | | $ | | $ | 130,081 | ||||||||||||||
Other income (expense), net | (7,815 | ) | | | | | | (7,815 | ) | |||||||||||||||||||
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Income before taxes | 103,763 | 18,503 | | | | | 122,266 | |||||||||||||||||||||
Income tax expense | 25,735 | 4,400 | | | | | 30,135 | |||||||||||||||||||||
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Net income | 78,028 | 14,103 | | | | | 92,131 | |||||||||||||||||||||
Net loss attributable to noncontrolling interests | (439 | ) | | | | | | (439 | ) | |||||||||||||||||||
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Net income attributable to Patterson Companies, Inc. | $ | 78,467 | $ | 14,103 | $ | | $ | | $ | | $ | | $ | 92,570 | ||||||||||||||
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Diluted earnings per share attributable to Patterson Companies, Inc.* | $ | 0.82 | $ | 0.15 | $ | | $ | | $ | | $ | | $ | 0.96 | ||||||||||||||
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Operating income as a % of sales | 4.0 | % | 4.6 | % | ||||||||||||||||||||||||
Effective tax rate | 24.8 | % | 24.6 | % |
* | May not sum due to rounding |
PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120 | NEWS RELEASE |
PATTERSON COMPANIES, INC.
FREE CASH FLOW
(In thousands)
(Unaudited)
Six Months Ended | ||||||||
October 30, 2021 | October 24, 2020 | |||||||
Net cash used in operating activities | $ | (539,014 | ) | $ | (423,004 | ) | ||
Additions to property and equipment | (15,503 | ) | (14,370 | ) | ||||
Collection of deferred purchase price receivables | 585,647 | 408,907 | ||||||
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Free cash flow | $ | 31,130 | $ | (28,467 | ) | |||
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