- Fourth quarter revenues of
$304.9 million , up 18.0% local currency* and 5.1% reported compared to prior year. - Fourth quarter diluted earnings per share of
$0.80 on a GAAP basis compared to$0.76 in the prior year. Fourth quarter non-GAAP adjusted EPS* of$1.12 , up 20.4% compared to$0.93 in the prior year. - On
September 15, 2015 ,Sirona andDENTSPLY International Inc. entered into an Agreement and Plan of Merger expected to close in the first calendar quarter of 2016.
Fourth Quarter Fiscal 2015 vs. Fourth Quarter Fiscal 2014 Financial Results
Revenue was
Revenue in
Gross profit was
Net income attributable to
At
Mr. Slovin continued: “Our strong fourth quarter was the culmination of an outstanding fiscal 2015. Sirona delivered on its most challenging strategic objectives throughout the year including a record IDS, a highly successful CEREC 30, and signed a definitive agreement to merge with
Fiscal 2015 vs. Fiscal 2014 Financial Results
Revenue was
Revenue in
Gross profit was
Net income attributable to
Merger Update
On
Conference Call/Webcast Information
Sirona will hold a conference call to discuss its financial results at
About
Sirona, the dental technology leader, has served dealers and dentists worldwide for more than 130 years. Sirona develops, manufactures, and markets a complete line of dental products, including CAD/CAM restoration systems (CEREC), digital intra-oral, panoramic and 3D imaging systems, dental treatment centers, and handpieces. Visit http://www.sirona.com for more information about Sirona and its products.
Forward-Looking Statements
This communication, in addition to historical information, contains “forward-looking statements” (as defined in the Securities Litigation Reform Act of 1995) regarding, among other things, future events or the future financial performance of
Additional information concerning other risk factors is also contained in DENTSPLY’s and Sirona’s most recently filed Annual Reports on Form 10-K, subsequent Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other
Many of these risks, uncertainties and assumptions are beyond DENTSPLY’s or Sirona’s ability to control or predict. Because of these risks, uncertainties and assumptions, you should not place undue reliance on these forward-looking statements. Furthermore, forward-looking statements speak only as of the information currently available to the parties on the date they are made, and neither
Additional Information And Where To Find It
This communication is for informational purposes only and does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval with respect to the proposed transaction between
Participants In The Merger Solicitation
SIRONA DENTAL SYSTEMS, INC. | |||||||||||||
(Unaudited) | |||||||||||||
Three months ended | Year ended | ||||||||||||
September 30, | September 30, | ||||||||||||
(In millions, except for share and per share amounts) | 2015 | 2014 | 2015 | 2014 | |||||||||
REVENUE | $ | 304.9 | $ | 290.0 | $ | 1,161.3 | $ | 1,171.1 | |||||
Cost of goods sold | (138.0) | (130.1) | (513.1) | (529.4) | |||||||||
GROSS PROFIT | 166.9 | 159.9 | 648.2 | 641.7 | |||||||||
Selling, general and administrative expense | (90.2) | (87.6) | (344.1) | (350.9) | |||||||||
Research and development expense | (12.9) | (16.5) | (54.8) | (64.6) | |||||||||
Net other operating income (loss) | 1.3 | 2.5 | 9.0 | 11.9 | |||||||||
OPERATING INCOME | 65.1 | 58.3 | 258.3 | 238.1 | |||||||||
Gain (loss) on foreign currency transactions | (11.5) | (1.9) | (17.9) | (0.3) | |||||||||
Gain (loss) on derivative instruments | - | (1.1) | 1.7 | (2.5) | |||||||||
Interest income (expense) | (1.5) | (0.5) | (4.2) | (2.9) | |||||||||
Other income (expense) | 5.6 | (0.5) | 5.0 | (2.0) | |||||||||
INCOME BEFORE TAXES | 57.7 | 54.3 | 242.9 | 230.4 | |||||||||
Income tax benefit (expense) | (12.2) | (11.6) | (54.8) | (53.0) | |||||||||
NET INCOME | 45.5 | 42.7 | 188.1 | 177.4 | |||||||||
Net (income) loss attributable to noncontrolling interests | (0.1) | - | (1.9) | (1.7) | |||||||||
NET INCOME ATTRIBUTABLE TO SIRONA DENTAL SYSTEMS, INC. | $ | 45.4 | $ | 42.7 | $ | 186.2 | $ | 175.7 | |||||
INCOME PER SHARE (attributable to Sirona Dental Systems, Inc. common shareholders) | |||||||||||||
Basic | $ | 0.81 | $ | 0.78 | $ | 3.35 | $ | 3.18 | |||||
Diluted | $ | 0.80 | $ | 0.76 | $ | 3.30 | $ | 3.13 | |||||
Weighted average shares - basic | 55,874,148 | 55,354,123 | 55,640,225 | 55,269,606 | |||||||||
Weighted average shares - diluted | 56,443,495 | 56,231,557 | 56,377,863 | 56,203,970 | |||||||||
SIRONA DENTAL SYSTEMS, INC. | ||||||
September 30, | ||||||
(In millions, except for share and par value amounts) | 2015 | 2014 | ||||
ASSETS | ||||||
CURRENT ASSETS | ||||||
Cash and cash equivalents | $ | 517.8 | $ | 382.8 | ||
Restricted cash | 0.6 | 0.8 | ||||
Accounts receivable, net of allowance for doubtful accounts | 154.9 | 115.6 | ||||
of $1.4 and $2.4, respectively | ||||||
Inventories, net | 129.4 | 123.4 | ||||
Deferred tax assets | 26.0 | 29.7 | ||||
Prepaid expenses and other current assets | 33.7 | 26.8 | ||||
Income tax receivable | 14.2 | 8.0 | ||||
TOTAL CURRENT ASSETS | 876.6 | 687.1 | ||||
Property, plant and equipment, net of accumulated depreciation | 208.3 | 221.0 | ||||
of $191.4 and $171.3, respectively | ||||||
Goodwill | 585.9 | 629.3 | ||||
Restricted cash | 0.5 | - | ||||
Intangible assets, net of accumulated amortization | 216.8 | 252.8 | ||||
Other non-current assets | 3.3 | 5.3 | ||||
Deferred tax assets | 10.9 | 15.5 | ||||
TOTAL ASSETS | $ | 1,902.3 | $ | 1,811.0 | ||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||
CURRENT LIABILITIES | ||||||
Trade accounts payable | $ | 65.3 | $ | 59.9 | ||
Short-term financial liabilities | 23.1 | 1.5 | ||||
Income taxes payable | 14.8 | 6.1 | ||||
Deferred tax liabilities | 0.7 | 2.2 | ||||
Accrued liabilities and deferred income | 191.2 | 167.6 | ||||
TOTAL CURRENT LIABILITIES | 295.1 | 237.3 | ||||
Long-term financial liabilities | 57.1 | 78.0 | ||||
Deferred tax liabilities | 100.5 | 111.8 | ||||
Other non-current liabilities | 21.5 | 25.1 | ||||
Pension related provisions | 62.4 | 71.7 | ||||
Deferred income | 24.8 | 25.9 | ||||
TOTAL LIABILITIES | 561.4 | 549.8 | ||||
COMMITMENTS & CONTINGENCIES | ||||||
SHAREHOLDERS' EQUITY | ||||||
Preferred stock ($0.01 par value; 5,000,000 shares authorized; | 0 | 0 | ||||
none issued and outstanding) | ||||||
Common stock ($0.01 par value; 95,000,000 shares authorized; | 0.6 | 0.6 | ||||
58,367,468 shares issued; 55,895,969 shares outstanding at Sep. 30, 2015; | ||||||
57,776,336 shares issued; 55,364,617 shares outstanding at Sept. 30, 2014 | ||||||
Additional paid-in capital | 702.6 | 697.9 | ||||
Treasury stock, at cost | (132.0) | (126.8) | ||||
2,471,499 shares held at cost at Sep. 30, 2015; 2,411,719 shares held at cost at Sept. 30, 2014 | ||||||
Retained earnings | 946.1 | 759.9 | ||||
Accumulated other comprehensive income (loss) | (179.1) | (72.8) | ||||
TOTAL SIRONA DENTAL SYSTEMS, INC. SHAREHOLDERS' EQUITY | 1,338.2 | 1,258.8 | ||||
NONCONTROLLING INTERESTS | 2.7 | 2.4 | ||||
TOTAL SHAREHOLDERS' EQUITY | 1,340.9 | 1,261.2 | ||||
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | $ | 1,902.3 | $ | 1,811.0 | ||
SIRONA DENTAL SYSTEMS, INC. | |||||||||
Year ended September 30, | |||||||||
(In millions) | 2015 | 2014 | 2013 | ||||||
OPERATING ACTIVITIES | |||||||||
NET INCOME | $ | 188.1 | $ | 177.4 | $ | 148.5 | |||
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | |||||||||
Depreciation and amortization | 69.8 | 76.3 | 75.6 | ||||||
(Gain) loss on derivative instruments and foreign currency transactions | 16.2 | 2.8 | 12.0 | ||||||
Deferred income taxes | 1.9 | (13.8) | (2.7) | ||||||
Share-based compensation expense | 13.7 | 12.2 | 12.8 | ||||||
Other adjustments | 0.5 | (1.3) | 0.6 | ||||||
TOTAL ADJUSTMENTS TO RECONCILE NET INCOME TO OPERATING CASH FLOWS | 102.1 | 76.2 | 98.3 | ||||||
CHANGES IN ASSETS AND LIABILITIES | |||||||||
Accounts receivable | (49.9) | 20.5 | (13.2) | ||||||
Inventories | (23.8) | (24.9) | (26.8) | ||||||
Trade accounts payable | 11.2 | (9.5) | 16.4 | ||||||
Other current and non-current assets | (11.4) | 2.9 | (15.3) | ||||||
Other current and non-current liabilities | 20.4 | 14.3 | 30.5 | ||||||
Current income taxes | 2.5 | (8.5) | (6.4) | ||||||
EFFECT OF CHANGES IN ASSETS AND LIABILITIES ON OPERATING CASH FLOWS | (51.0) | (5.2) | (14.8) | ||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 239.2 | 248.4 | 232.0 | ||||||
INVESTING ACTIVITIES | |||||||||
Investment in property, plant and equipment | (52.8) | (93.7) | (70.7) | ||||||
Proceeds from sale of property, plant and equipment | 0.9 | 1.1 | 0.1 | ||||||
Purchase of intangible assets | (0.5) | (0.5) | (1.2) | ||||||
Acquisition of business, net of cash acquired | (18.5) | - | (35.0) | ||||||
Sale of business, net of cash sold | - | 11.5 | - | ||||||
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES | $ | (70.9) | $ | (81.6) | $ | (106.8) | |||
Year ended September 30, | |||||||||
(In millions) | 2015 | 2014 | 2013 | ||||||
FINANCING ACTIVITIES | |||||||||
Repayments of short-term and long-term debt | $ | (0.1) | $ | - | $ | (0.1) | |||
Purchase of treasury stock | (5.2) | (14.8) | (42.9) | ||||||
Purchase of shares from noncontrolling interest | - | - | (1.4) | ||||||
Dividend distributions to noncontrolling interest | (1.3) | (1.5) | (1.4) | ||||||
Common shares issued under share based compensation plans | 4.2 | 6.8 | 7.9 | ||||||
Tax effect of common shares issued under share based compensation plans | (10.2) | (0.5) | (0.2) | ||||||
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | (12.6) | (10.0) | (38.1) | ||||||
CHANGE IN CASH AND CASH EQUIVALENTS | 155.7 | 156.8 | 87.1 | ||||||
Effect of exchange rate change on cash and cash equivalents | (20.7) | (15.7) | 3.5 | ||||||
Cash and cash equivalents at beginning of period | 382.8 | 241.7 | 151.1 | ||||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | 517.8 | $ | 382.8 | $ | 241.7 | |||
SUPPLEMENTAL INFORMATION | |||||||||
GENERAL | |||||||||
Interest paid | $ | 3.7 | $ | 2.7 | $ | 2.8 | |||
Interest capitalized | 0.3 | 0.4 | 0.2 | ||||||
Income taxes paid | 40.3 | 60.3 | 65.7 | ||||||
ACQUISITION OF BUSINESS | |||||||||
Current assets | $ | 3.7 | $ | - | $ | 5.2 | |||
Non-current assets | 25.1 | - | 61.2 | ||||||
Current liabilities | (4.8) | - | (7.8) | ||||||
Non-current liabilities | (5.4) | - | (12.0) | ||||||
18.6 | - | 46.6 | |||||||
Cash paid | (18.6) | - | (36.7) | ||||||
Settlement of balances | - | - | (4.5) | ||||||
Fair value of liabilities incurred | $ | - | $ | - | $ | 5.4 | |||
Reconciliation of GAAP and Non-GAAP Information (unaudited) | ||||||||||||||
HISTORICAL | ||||||||||||||
Non-GAAP Adjusted Net Income Financial Measures | ||||||||||||||
(unaudited) | ||||||||||||||
Non-GAAP Financial Measures (GAAP reconciliation) |
| Three months ended | ||||||||||||
| September 30, 2015 | |||||||||||||
(In millions, except for per share and percent amounts) |
| Pre Tax | Tax Impact* |
| After Tax | Per Diluted | ||||||||
GAAP net income attributable to Sirona Dental Systems, Inc. shareholders |
| $ | 45.4 | $ | 0.80 | |||||||||
Adjustments | ||||||||||||||
Amortization and depreciation expense resulting from the step-up to fair values of intangible assets related to past business combinations |
|
| $ | 6.3 | $ | 1.3 |
| 5.0 | ||||||
(Gain) loss on foreign currency transactions, net |
| 11.5 | 2.6 |
| 8.9 | |||||||||
Other items: | ||||||||||||||
Merger and acquisition-related expenses |
| 3.1 | 0.7 |
| 2.4 | |||||||||
Management Transition |
| 0.1 | 0.0 |
| 0.1 | |||||||||
Discrete tax items |
| 1.2 | - |
| 1.2 | |||||||||
Non-GAAP adjusted net income attributable to Sirona Dental Systems, Inc. shareholders |
| $ | 63.0 | $ | 1.12 | |||||||||
* tax impact calculated using estimated effective tax rate of 22.1% | ||||||||||||||
Non-GAAP Financial Measures (GAAP reconciliation) |
| Three months ended | ||||||||||||
| September 30, 2014 | |||||||||||||
(In millions, except for per share and percent amounts) |
| Pre Tax | Tax Impact* |
| After Tax | Per Diluted | ||||||||
GAAP net income attributable to Sirona Dental Systems, Inc. shareholders |
| $ | 42.7 | $ | 0.76 | |||||||||
Adjustments | ||||||||||||||
Amortization and depreciation expense resulting from the step-up to fair values of intangible assets related to past business combinations |
|
| $ | 8.6 | $ | 1.8 |
| 6.8 | ||||||
(Gain)/loss on foreign currency transactions, net |
| 1.9 | 0.8 |
| 1.1 | |||||||||
(Gain)/loss on derivative instruments |
| 1.1 | - |
| 1.1 | |||||||||
Other items: | ||||||||||||||
Management Transition |
| 0.4 | 0.1 |
| 0.3 | |||||||||
Non-GAAP adjusted net income attributable to Sirona Dental Systems, Inc. shareholders |
| $ | 52.0 | $ | 0.93 | |||||||||
* tax impact calculated using estimated effective tax rate of 21.8% | ||||||||||||||
Non-GAAP Financial Measures (GAAP reconciliation) | Year ended | |||||||||||||
September 30, 2015 | ||||||||||||||
(In millions, except for per share and percent amounts) | Pre Tax | Tax | After Tax | Per | ||||||||||
GAAP net income attributable to Sirona Dental Systems, Inc. shareholders | $ | 186.2 | $ | 3.30 | ||||||||||
Adjustments | ||||||||||||||
Amortization and depreciation expense resulting from the step-up to fair values of intangible assets related to past business combinations | $ | 26.3 | $ | 5.9 | 20.4 | |||||||||
(Gain)/loss on foreign currency transactions, net | 17.9 | 4.0 | 13.9 | |||||||||||
(Gain)/loss on derivative instruments | (1.7) | (0.4) | (1.3) | |||||||||||
Other items: | ||||||||||||||
Merger and acquisition-related expenses | 4.6 | 1.0 | 3.6 | |||||||||||
Management Transition | 0.8 | 0.2 | 0.6 | |||||||||||
Discrete tax items | 1.2 | - | 1.2 | |||||||||||
Non-GAAP adjusted net income attributable to Sirona Dental Systems, Inc. shareholders | $ | 224.5 | $ | 3.98 | ||||||||||
* tax impact calculated using estimated effective tax rate of 22.6% | ||||||||||||||
Non-GAAP Financial Measures (GAAP reconciliation) | Year ended | |||||||||||||
September 30, 2014 | ||||||||||||||
(In millions, except for per share and percent amounts) | Pre Tax | Tax | After Tax | Per | ||||||||||
GAAP net income attributable to Sirona Dental Systems, Inc. shareholders | $ | 175.7 | $ | 3.13 | ||||||||||
Adjustments | ||||||||||||||
Amortization and depreciation expense resulting from the step-up to fair values of intangible assets related to past business combinations | $ | 35.7 | $ | 8.2 | 27.5 | |||||||||
(Gain)/loss on foreign currency transactions, net | 0.3 | 0.1 | 0.2 | |||||||||||
(Gain)/loss on derivative instruments | 2.5 | 0.6 | 1.9 | |||||||||||
Other items: | ||||||||||||||
Management Transition | 3.3 | 0.8 | 2.5 | |||||||||||
One-time gain on sale of certain operating assets | (1.9) | (0.4) | (1.5) | |||||||||||
Non-GAAP adjusted net income attributable to Sirona Dental Systems, Inc. shareholders | $ | 206.4 | $ | 3.67 | ||||||||||
* tax impact calculated using estimated effective tax rate of 23% | ||||||||||||||
To supplement our consolidated financial statements and our business outlook, we use the following non-GAAP financial measures: (i) non-GAAP adjusted net income, and (ii) non-GAAP adjusted earnings per diluted share, which exclude, as applicable, amortization and depreciation expense resulting from the step-up to fair values of intangible and tangible assets related to past business combinations, gain/loss on foreign currency transactions, gain/loss on derivative instruments, any related tax effects, and to the extent relevant in a particular period, any other cash or non-cash items that management does not view as indicative of its ongoing operating performance. Also set forth above under the heading “FORWARD-LOOKING” are reconciliations of forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measures.
Management recognizes that the use of these non-GAAP measures has limitations, including the fact that they might not be comparable with similar non-GAAP measures used by other companies and that management must exercise judgment in determining which types of charges and other items should be excluded from its non-GAAP financial measures. Management currently compensates for these limitations by providing full disclosure of each non-GAAP financial measure and a reconciliation to the most directly comparable GAAP measure. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
We use these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. Our management believes that these non-GAAP financial measures provide meaningful supplemental information regarding Sirona’s operating performance in the ordinary, ongoing and customary course of its operations. Accordingly, management excludes the impact of acquisition-related intangible depreciation and amortization in order to compare our underlying financial performance to prior periods, certain charges related to currency revaluation of assets and liabilities that do not reflect our period-to-period core operating performance, and to the extent relevant in a particular period, any other cash or non-cash items that management does not view as indicative of its ongoing operating performance. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting and analyzing future periods. These non-GAAP financial measures also facilitate management's internal evaluation of period-to-period comparisons. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision making and (2) they are provided to and used by our institutional investors and the analyst community to facilitate comparisons with prior and subsequent reporting periods.
Local Currency: We have included certain revenue information in this press release on a local currency basis. This information is a non-GAAP financial measure. We additionally present revenue on a local currency basis because we believe it facilitates a comparison of our operating results from period to period without regard to changes resulting solely from fluctuations in currency rates.
Sirona calculates local constant currency revenue growth by comparing current-period revenues to prior-period revenues with both periods converted at the U.S. Dollar/local currency average foreign exchange rate for each month of the prior period for the currencies in which we do business.
* Non-GAAP adjusted EPS and local currency growth and results are non-GAAP financial measures that exclude certain items. Please refer to “Reconciliation of GAAP and non-GAAP Information (unaudited)” in the attached exhibits for a description of these items.
View source version on businesswire.com: http://www.businesswire.com/news/home/20151120005165/en/
Source:
Sirona Dental Systems, Inc.
Joshua Zable, +1-718-482-2184
Vice President, Investor Relations
joshua.zable@sirona.com