Becton, Dickinson and (BDX) 4 May 232023 Q2 Earnings call transcript

Good day everyone and welcome to today’s Becton, Dickinson Q2 Fiscal Year 2023 Earnings Call. At the time, all participants are in a listen-only mode. [Operator Instructions] Please note, this call maybe recorded, and that I will be standing by should you need any assistance.

It is now my pleasure to turn today’s program over to Francesca DeMartino. Ma’am please begin.

to call. welcome and morning, BD's earnings Good I'm Investor Relations. Senior Vice Head of President and Francesca DeMartino, On the behalf joining for of BD team, you thank us. bd.com. being audio is available at call This made webcast via for this the Earlier released BD its second of fiscal morning, quarter XXXX. results

that the earnings business, performance. investors.bd.com. IR release website posted press details can presentation and additional presentation at also on provides We be The and an our strategy, accessed on

for Chairman, and Chief DelOrefice, Leading XXXX. Financial Executive Strategy. and our additional today's Polen, our financial provide fiscal call provide Chris President are BD details then President; performance continued QX will Executive Tom performance BD's Vice our and Chief guidance Tom Officer. and XXXX of our execution and will on Officer, highlights Chris the of updated

will Sciences the Dave Medical Byrd, and Presidents, for and prepared by Q&A Tom Life segment segment; President of the Following segment. the the Mike segment; remarks, President of be joined Garrison, Interventional Rick of President Chris Hickey, our

want our Before in be you specified, disclaimer available year-over-year we the SEC percentage get both started, in are the an changes Unless will to all period. otherwise the a IR be read on on which unless our basis comparisons I relevant otherwise to website. basis remind the forward-looking disclosures statements. making filings, that FX-neutral release versus on encourage and will earnings Revenue we are you noted. I

the of appendix. included period. are will presentation basis any reconciliations terms we note period given the referring to attention as we When in revenues as period, your base defines which to also it I the refer calendar and such to specifically non-GAAP we slide, unless call a the fiscal

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towards the during we while result, inventory. saw levels exited with positive inventory the quarter, quarter a progress we reducing As peak

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quarter QX $X during debt refinancing balance over of net year. maturing debt the We a be includes ended the billion, balance the of repay ended to X.Xx. with leverage from approximately We ratio of a that which cash proceeds the the will quarter with utilized

the pay of to expect balance net paper We over the of move our towards X.Xx. leverage and down our commercial target year

our build we increase and progresses capacity deploy M&A. year the cash tuck-in cash, we will As towards to

XXXX. our to for Moving guidance fiscal

our can be our also your in detailed convenience, underlying assumptions guidance the found For presentation.

performance, our FX quarter future of execution confident our in The and to rates, the business is testing our EPS in offset reinvesting Given the enabling we drive guidance COVID-only ranges. midpoint of are revenue of latest goals our raising and revenue growth and strength to adjusted our ability the margin growth. while base revenues lower consistent

Starting insights key with I into guidance revenues, will provide of some assumptions. our some

across at we our First, are guidance. thus, well-positioned strong or our and which segments, are we three above expectations, growth are increasing our for revenue delivering base

consistent a grow of guidance XX to team's midpoint we execution revenue continued currency-neutral the from X.X% and the to have On increase to our prior is This revenues of and we X%. outperformance X.XX% profile. now our points at QX our basis in by confidence is driven base strong an basis, our growth and expect X.XX%,

for expect increase points both We plus to strong XXX higher revenue X% our two-year X.X%, above inorganic organic guidance which revenue growth to basis brings now XX organic, X% of FY expectations for which our midpoint revenue growth by basis which Parata. includes XXXX at base execution contribute or Increased target. driven base an in the is growth we strong XXXX, about approximately increased the the again of is our revenue average Following the guidance and of X.X% full-year, growth FY points, our full-year. of well inorganic

of Organic points, exits. from basis include XX growth revenue to now to base X.XX% resulting the XXX Both an points our to continue based and be at X.XX%, growth approximately portfolio midpoint. base basis revenue a is revenue expected one-time increase of strategic reduction our planned organic

year, aren't we our segments planned with guidance, deliver our on long-term segment-specific in-line While across track to this are providing fiscal performance we commitments. strong

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assuming our decline For testing, result the about peak early million of in million volumes about season. of $XX $XXX versus previous by are the COVID-only expectation we $XX rapid testing and a revenue reduced million, the as now to respiratory of driven

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shipments XXXX fiscal only Alaris, to related necessity Regarding continue to in-line demand. medical we model with

our XXX to expect Regarding assumptions by basis earnings, to improve on least for the we full-year. at margins continue points operating

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us driving growth, incremental profitable including inflation combined that margin year, while COVID-only expansion place, has focus operating absorbing which a planned deliver actions we programs announced, again we simplify outsized about on confidence significant and meaningful of the the that model recently decline higher margin with previously the Our in this profile. revenue, XXX revenue in basis points gives the will

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in approximately adjusted of XX%. testing. to to XX.X%, guidance business mid-teens COVID-only includes within reflects we and which of digits strong growth range approximately previously ability higher around currency-neutral is Our to XXX points X.X% than absorb the is growth very EPS a that driving is anticipated over and our decline This basis double base XX%

delivering base margin strong about base high-teens is targeted two-year targets our a margin EPS above a reflects levels towards Day, XXXX; above expansion XXXX well and of CAGR, at of XX% BD XXX points Our CAGR long-term plus we X.X% updated which of our our about our revenue out or business financial XXX XX% laid is X%, Investor in two-year double-digit also base significant target. well least strong points organic toward at our progress the operating long-term guidance targeted including: which basis FY basis target;

As year. but we areas the you model are slides, more We've accompanying out presentation following you of to key note. me some consider outlined comments the XXXX think of balance detail to the let provide fiscal phasing, for as the in

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discrete best is other as timing effective any exact full-year our of of to in balance of and XX.X% assume midpoint the an QX rate guidance occurs indicates items the evenly is of about year, estimated QX tax which rate for tax predict. hard to Lastly, the the

we halfway strong our as approach XXXX multiple financial strategy delivered has closing, point, In BD of performance. periods the consistently

As continued long-term we towards XXXX and progress BD we look reflected well our guidance and positioned are for our XXXX forward targets, as our FY growth. in

Operator, start session. With our the please? can Q&A you assemble let's that, queue,

sir. question first Instructions] from JPMorgan. will come Our Yes, Marcus [Operator with Robbie

Your line is open.

bottom I and for seeing on Maybe really Good line, had go taking guidance. Oh, row up than bottom a But guidance less the is a and where by to ask line. the on in a on guys the good morning quarter the start, raised great. performance top again beat, the This beat wanted to questions. have you we're everyone little guidance, line, the on thanks second

and a offset spend through and looks So, puts on rest worse how getting changing managing about also top be line, the like maybe minute FX to isn't headwinds. the year in bottom the the of takes be and great but able And you're it'd on line. – some it's the to of thinking any guidance talk it

that as So, there in maybe throw well.

Thanks, It's Robbie. the Yes. Appreciate Chris. question.

I think pretty straightforward. is this

So first, we to in basis and XX guidance, second point. On just X.X% strong our look, base. our on another X% points quarter from increase to or increased revenue, your

think benefit tuck-in X.XX%. And you note, at when So, the now, X% midpoint, that's two-year organic pure I a important X% on to M&A, strip right, basis. the our even or growth average so out from

well So, really strong, above our X.X% profile.

of last our in would rate growth matched communicated be think way second As stayed half you XXX% recall you quarter, the that That in of QX. think if the The increase, that, intact. increase revenue to basically the X.X. outperformance we

So, we're to holding it X.X.

revenue to think growth X.X% first the half, to Importantly, organic from the again, above plus. X X, and second as half of you actually, our the nicely accelerates

story revenue strong FY following really strong XXXX. So, a

the I so, where earnings, your core building is, one, strong growth. question On of think the on

our execute multiple margin declining. goals. Hopefully, margins in hasn't this you're macro We in against that with environment continue industries gotten to seeing lost where many

in So, improvement basis We XXX points the had of slight margin quarter. we're committed the improvement. to

intact. So that holds

So basically, of have base the understand to, of and really kind it think you way break business. raise, down the the to

tax we by we you we noticed [$X.XXX] our as modified guide. It – base XX equals, exactly And the kind raised [ph]. base drop-through on of presentation, slightly noted business, in the on our the revenue. midpoint then the million of margin So, increase our on

the of So, the revenue the tax accounts XX% best. for for it, accounts about

our important also we're a year-over-year guidance. actually full-year It's any think on I getting still note, benefit that's headwind in year-over-year absorbed tax. to not

another reflects it absorbs think And really anyway, that think performance. it important $X.XXX, reminder I – so I So, base strong basically two factors.

higher noticed commercial very You GP, as the has has in the the by strong because in about $XX COVID-only a margin million. That down drop-through little investment. moderated testing we shared past. there's a we've that It

range. than So, and And dropping was we some absorb guide It was was which our normally absorbed did dollar lieu quarter, EPS, and significantly strengthened adjusting $X.XX remember bit FX we performance. the on recovered. the like was the modest. $X.XX. pressure for a on euro if absorbed do then pretty we more of little there actually We base in the That that FX FX, you that. – in strong

actually in at look the average you quarter. So, to have the

the little euro. was bit with the quarter in a So, there

also You currencies. had yuan were the two the and the other yen

at a Net-net, impacts raise in mind, the So, And then just thing important knowing there. testing, just at keep year-over-year that well growth actual significant EPS. by above business double-digit base COVID-only the for to our declines growth when you [$X.XXX] modest absorbing midpoint. it's is the XX%, EPS think our EPS most look our on everyone base I nearly [ph] we're year-over-year, in

where good really the feel we year. So, sit, we through halfway about the

We We core said, investing. haven't sure to any margin. keep changed solidify we commitments of the we our, around future. kind make to of With want that want

over growth one what story and here you're play in We great And R&D levels. higher will multiple durable. this quarter, about will at this year. We be seeing think isn't to invest that continue one is – out happen a periods is

answer helpful. data on the I be updates out a looking anticipate points given approval? catalysts to the any or we can quick on follow-up. your Maybe could upcoming or pathway probably Really for just but here, focus, Alaris

resources as are submission we've Obviously, number that times, our prioritize this. we And to confident Tom. Alaris the leadership in discussed our the many and back market we have invested is is the This morning. good priority. and X getting Robbie, on Hey, tasked team in

will we've FDA. that you the and been thoughtful want confident and in we're prudent and to As process clearance, with remain and process and get we about we have as our expected before, said the

And so time predict to therefore, try lines we submissions how not continue these to are. complex exact just inherently given

job for that obviously, sure immediately remains the we'll the communicate and So, we at But there. all making and that strategy sure information number making been question. FDA we're require that once on our product. has get focused our the clear to fully the X that Thanks they is clearance, point, has

Thank you.

Biegelsen Wells with Larry Fargo. from Our next question will come

open. Your is line

Good just a two-year new feeling Chris congrats super One, two of taking at level, growth a morning. talked to few a are growth wanted Thanks for question. here. that cycle the you. this I quarter high on how I for XXXX? nice the start and Tom, you think X.X% you target your for times of X% CAGR products mentioned about year. is organic beyond about, The organic

higher X.X% could one So, this had year? follow-up. beyond And be that I

We're described. not the extremely as to Okay. always. our you commitment have we Larry connect at that for are to feeling have about long-term adjust question. but the outlook Good we going We're and time, this momentum that looking morning, we positive pipeline our as and about Great forward. excited great thanks the very

are we of few continued in stands talked became this high-growth we've discussions clear where the progress across about hopefully as that systematically we we company. platforms our I look that think it morning, we've those. And are at a and today, to built what out, of the and number

XXth the leader and double-digit both but been drug also to that pipeline delivery, wearables we professional in the as capacity the as molecules And self-injection the first enabling in well-positioned are blockbuster with pharma's innovation now small growth, big is as more and are in delivery from today, the now time have, that in which significant for coming coming investing some of Systems, being market Pharm biologics as trend benefit down well being biologics we've products and to we've pipeline added, well. we macro injectable it's the quarter not of a or pipe. now history, row – in and environment Whether products

doing front-off be Pharmacy for with more to to we're a trends going shortages, the the that Huge to wellness et serving the front pharmacists in going that that fuel continue of patients really checks, to forward, need – going that and growing teens. automation, labor to $XXX pleased are move million-plus right to we've see platform cetera, we're strong demand platform automation, pharmacy for built. continue now,

whole in to shipping super sites help there. of adopter and When Nobel and a you flow new of them of about just started cytometry. that of right rolling described, technologies we're going new new really a FACSDiscover, think in to out we've all early system bring were the almost those immuno-oncology cell just therapy that overall. discoveries opportunity and who I the fields to convinced with now. there new the tremendous huge is and insights see cycle immune Prizes BXB, the understanding areas using uncovered you're I'm And discoveries innovation getting set being The

utilizing we're the first, high-end excited. going And out And in we're Really going launched be that rolling mid-and-lower-end capital side as of complemented launching to to be to technologies that cell several roll-out. first will informatics to technology continue or with now the new course, continuing We're the portfolio same our family and the next by offering expanding not as that's but we're is have product the and whole antibody we a complemented That's launch. well on years. portfolio, just sorter die over FACSDiscover. that only analyzers, sorters

out few few done you're great us heard there, growth that's was we've that TIFA, years have that developed over had we the over applications, strong And acquisitions acquired a example innovation and just there. an the or segment. This you good [indiscernible] another new together, umbilical last gave BD quarter a into number years Interventional, BD Bard of we're hernia. before we're which PureWick done like expanding things and we there, and been and the of last how that happening seeing about of growth came talk seeing the strong number platforms of the BDI

benefits how portfolio planning a in Straub get We're our course, of horizon continuing growth strong you're globally. Alaris that of Medical seeing there. medication PI to there with business. picks And that's pleased the being happening in really back growth delivery, our and to on and aim the from through market. eventually and And that's our expanded momentum catheters the

track of momentum. pleased XX about launches we're every So, and much year date. number that's question. year. key far pretty same year be again the We're we've the had this And the with so fiscal last for this forward. on about Thanks to to done XX really really that for coming pleased with launches We've we off launches key continue year as look we

helpful. super That's

know confidence Just question you you the My about the it talking margin get Alaris improvement the within points Robbie's Alaris. XXXX And can – are expressed for specifics, follow-up It's in – I you one within have is, in but the hear not you're today. on on to of confident I XX the great quick know BD you basis plan? plan. BD question XXXX

have other leverage it? margin If have line, from offset the can within expecting you. time do Thank – you you're ways you you don't it to that

our we predict Yes. of about XXXX FY we margin, put given you basis maintain Yes, plan. XXXX. said Thanks, right, to going That XX% year. good recall, thing that goal. cetera, I'll to We've investment towards very step we we take point, field been if us and The weren't again, haven't timing, of back say Larry. there our been goal, made clear, – would the was part part service, your this our on-track FY about XX our that one. to delivered XX% did headwind We're as if of through et that just we margin as to you in decision Alaris. point support, while

announced, the not We're given on leverage the back way do of place, Those profile continue In you leg Project to drive portfolio put get. as the to the have a we think essence, dependent expect basis. way XX% EPS will been model the third we've We The half Recode, to continue of operating kind mix we to just natural announced of variable. been year. accelerate simplification. strong levers that have on in Recode continuing and get We doing. initiatives of through it how growth deliver good that of feel we we growth there, consistent the really we And double-digit multiple is to one both. between

the think that confidence commitments, between of as half delivering host improvement line So, of us back to the a XX% the both growth. actually, through margin and sort ability of EPS margin on growth double-digit navigate and while I there's progress to continue the balance we the give things top year and

well-positioned think So, that I gives us you lot flexibility. way, think of of we're it really a when

do as as included mentioned. Chris, have levers clearance certain et other in we to we'll we when levels done is have But about as that well-positioned that cetera. before, so, so talked on add customers, good that There's be right? many comments we to is strategic just increased get our – we've And Alaris Alaris preparing been, so we've that we've And serve to components, shared inventory our plan. eventually,

market comes, kept customers. service have, additional in We've the talked as selling eventually as so about well that on that quickly, can that organization our pumps the support clearance both we we the remediate continued in are investments when

thank So, the question. you for

Thank you.

question ISI. Our from will come next with Evercore Vijay Kumar

open. is line Your

within a cycles? can funding categories is number sprint Is here. like Life is And think, is on the Hey, is one It that? nice There's pharma, My life biopharma outline, feels that vascular. surgery in all flow guys. of gaining gaining sustainable like a And the you BD what emerging within are categories. Congrats on for just simplistically share. share? how hernia, science, cytometry, on Sciences, cycles, true? any concerns pharma, Appreciate looks you. BD colors, the new I here first that product but It

comments. question, Vijay, Yes. and Great the appreciate

presence we'll segment in around. go So, the We've room. got here the

don't growth and pleased categories, is of market What a rates really I through driven start Systems, capacity the speak we've seeing that, made but pharmacy Pharm and in strong to and think you're automation with medication Mike segment Medical investments we right. we're outperforming with seeing management really innovation, can number overall. you're and in we're strong Why also that execution. what both

in sort the There's for growth that Thanks we've built of Medical. Yes. question. three drivers

to sensitive continuing. really few XX pipeline capacity Tom we of We comments, feel in of good double-digit straight investments, biologics Systems, our ago years us. and as plus quarters has which coming really implement, growth towards that to continue the combination both durable built those that requirements our the opening a growth. innovation, And the support and that about Pharm – First, the mentioned

that MMS, dispensing care as long-term really way markets, innovation, how both the really of come going connected the markets. is that pharmacy In automation That clinical into area together and tie to and around really retail ties business. that It's just hospitals and This shift happy our the really now efficiency with in the for ripe the have the med with hospitals we're care well-positioned well. a we're acquisition. outside the and hospital the start in management teams

Vascular where experience in makes continues to the a customers, aspects especially MDS, it both then and well. to the Management patient those clinical Continues Access experience strategy resonate And with the do one. positive really

of And WAMGRs. comment see really we our look at growth it on in look we it position. at we're necessarily don't And in over that. – so, – terms showing terms market we WAMGR. We But don't of tend do we

So, or over Dave. good turn it Rick in that I'll area feel to well. we as

Great.

Vijay, BDI. the Thanks, the And question. So thanks, for to about talk opportunity Mike. Tom, for

surgery So, the off, all quarter, businesses almost really pleased contributing. with said, in results the X.X% pointed like you out first with at And XX%. growth overall you

growth really and And of areas all strong growth our segment and execution reconstruction, the markets across innovations end our so, this really those the repair newer key pointed reflects incontinence, strategy to advanced contributing that nicely PVD, performance oncology, in across out, are higher Chris growth.

digits, have for alternate So, growing aided really said, the double the presence is we you growth chronic continues really by a surgery. the recent care launch in of adoption aided Arista. us for Phasix, and and incontinence market resorbable PureWick driven of Biosurgery Male. the PureWick acute of hernia Like continued growth in setting strong by UCC, PureWick franchise, our scaffold. by to the continue see to

seeing good business, the well finally, past. in chain we're as of made really supply we're global in benefits across really that then we've investments And there. a PI – improvements So, of our lot strategic the as

in Rotarex. strong. of relaunch of And is paying with Venovo. We off, strategy We're our global really then China have penetration is global pleased really oncology strong the expansion

their like PureWick mentioned, or have launches Tom believe conditions, right feel success. strategy improving whether we made, they confident combine be and strategic products procedures, Team including supply we elective as investments market extremely our with drive continued of M&A such the of, we've again, the as Rotarex, And Phasix the that external tuck-in with executing new with overall well, you success we chain. Male. So, then product to the or recovery the is

to just maybe add And to Rick's comments there. good

are PI that new happening that out the particularly I for number markets investments and a launches stands the think in BD. business entirely are something of for there new is

almost are gains that they're driving growth, that so, happening are exclusively share And right?

that's about gain. you XXX% So, and think atherectomy share thrombectomy,

that's have that acquisition growth and we hadn't Venclose from all category. the that, market. about been because been the Venovo gain that's stent, we And the we did think off in the course, share coming I of

question relaunch very the as just so, And that more to – regaining Dave? of that market all And regaining and share. is specifically is address well, maybe,

Yes, for Dave. sure. Great it's Vijay, question.

So, segment. again, to the mean, reiterate just for I

in the highlights. good in headwind it's Science mean, strong year. from demand a couple So, continue you mean, strip you core instruments. BDB BDB, the and growth the the XX.X% maybe over Life even in climb see pick the if at for a to saw across whether same release, really period I in growth reagents, for the as new last the quarter IDS, board, just reagents, tremendous XXX of of the away strong bps research from we clinical I'll respiratory I

of this quarter perspective, Life double-digit from reagent is tenth talked dyes about, dyes, actually our now. successive the so Science that's Actually, growth the that a research Tom Horizon

and leverage talk and assay do BD IVDs COVID, You've obviously us from before, we BD the pandemic in instrumental which Max perspective. of now heard utilization about was Max the a respiratory But take-up sort how of assay for penetration?

double-digit the good the we're that facing, And starting to really COR – side, see to talked BD BD on staffing think is for about Kiestra, maybe the growth Thomas in then we great. about. continue IVD labs we automation molecular are eight really of which again, traction challenges growth, when see successive you reagents, the quarters And that

large breadth of institutions. If biopharma, pharma, you very asked BDB – is, academic diversity centers, question have and customer to reagents we by on medical just the of specific think platform big a just about strong for and base, academia, sure sustainability good customers research so but thing a The BDB. relative not that a we've you got the the and

of the gene us therapy, doing, stuff chronic that they're I fighting So, helps about in diversity think there oncology. terms think therapy, of in really all cell the base So, and that right? research you of the immuno-oncology, disease types

year. that we at that think base. the getting this this you the of good today, ready really we've two I reflecting back first even in was were the and and X feel first I we year, XXX(k)s months then And as eight had sustainability, segment PMA of So, overall, for approved half supplements from about for look when just actually

that So, that builds we momentum as Hope the helps. go forward all to here.

in at we basis levels? gross quarter answer. of despite Chris, comprehensive quick inflation is impact, back on performance margin. margin for half a one points the [Q], above second gross Thanks quarter of should think or or that being And just third XXX

Yes.

half over couple consecutive So, points. inflationary the It coupled mitigation of XXX year. of that second moderation first combination things. the the the from a you some half. a year actions actually of was will with, It's we're actions of It of prominent abate absorbing a in pressures. inflation, improvement second full-year basis some more remember, One, we're taking if in of and course, cost standpoint,

GP in So, improvement a standpoint. through expected we modest full-year from

ahead FY to think which our I be XXXX would of slightly gross was margin, QX similar, expect So, XX.X%. basically you

flows other expand think thing out that is, see that our improvement. we we're remember, we QX. will And But into five as to further about track. you'll inventory on then have the So, of through right sales. I slight point move months And

strong goals. sight of cost in through achieve us has inventory cost those in that that as basically improvement to a inventory, to our the the confidence cost. all the line So, the it of in year, sells gives actually we that's have And back part of driven that that that sitting inflation been base half is strong

you. Thank

from Barclays. question will come next Our Miksic Matt with

line Your is open.

this maybe earlier. around it some seems. on strong beats And on good for changes. bit just we But is further if this quarter just just a been so I significant, guidance, touched bottom to and I know, – had the a sensitivity to quarter Robbie on clarify congrats the taking much raises and line Hey go the to because because questions just here. Thanks I Chris, wanted to want there morning. could, so a back

that the headwind actually margin significant FX remember takes was well. this the offsetting raise right of that COVID quarter? that quarter, to was I quarter part if relative a lift, got last In But Is sort last correctly, an big was, FX of quarter, an higher a another that of part of So, – tailwind. sort COVID as the of about, puts you've also There or think headwinds sort [indiscernible] you're the this absorbing. FX lower tailwind. and way

correct. Yes, that's

Just one comment on which FX, interesting, is right.

the Our actually starts peak to FX pressure QX of in adjusted fiscal we reporting guide original a guide. had And right? the companies point, the their first we the fiscal most – weakened bit. when sort at up year. significant initial dollar, to U.S. strength similar We period gave So, We earlier. our of your our started dollar of

quarter, And back. in so, we reversed gave a unfavorability of lot that that the

in had we offset testing strong, our in EPS a takedown base and The expanded, the – was COVID-only your base point, QX. actually to

the FX and bit significantly, This dynamics raised market quarter the $X.XX down two noted dynamics, full is a taking little strong another testing by previously. you that year I the Again, was base has It bit a that for we We to see how and actually had Again, a softened $X.XXX. those different. by COVID-only offset bit then reasons of EPS. given things. little on pressure

two net back those but just to I So, will it's [ph], items, [$X.XXX] go shared. of I what

absorbing points almost that's testing pressures. our year-over-year our look XXX all inflationary business, the So while base EPS XX%, again, base basis and growing COVID-only when impacts, of at you over is absorbing

investments delivering future. sure I environment. think also into it's We're performance this well growth. make to want we're somewhat we really unprecedented of strong performance this continue type maintaining that in And the to

of to it. helps. that how think that's So, Hopefully,

Chris' the year, we that have number I the think obviously, have year-to-date. now in guidance So, COVID the just essentially to add the the to we COVID is COVID has out balance comment, basically for number update of that here right?

go, spot to dynamics, when a other, is on into be which rates FX calculate of that QX, But cycle million. QX, it we quarters right, calendar on today. be to given FX fiscal there directly. to improved, where those our lot actually will There's only FX top $XX three when right? we $XXX The moving So parts million based had could tailwind are line, just

true has So, We at in you included. that calendar next ours. when full that's look picked that other year, year a guide up people's

helpful And this the Got of slides are it. also That's helpful. super really walk through sort stuff. material to,

guidance other on line. The again, – top on the

heavier if you change, you you inorganic from out, you're So, specifically. positive your make a a will pointed adds, contribution, did expecting contribution as

want And say to so, discontinued there I question build. of of coming don't you products exits, but basically your to that which are have but you this and know have not of last out another a I revenue the was inorganic company, – controversy, out quarter, adds coming portfolio sold

exactly that. kind And but agree offsetting describing it was it with were about of And organically. not those the each you things I way I thinking think we're are, would – organic,

those of Now, still back XXX shifted you basis you're of exits. description, more portfolio sitting to but sort points organic traditional

little a seems on Is stronger to line? top though read way strength a business bit – $X.XX, it's side. to to is organic So, the the it on $X.XX fair the it be the that even base on

think midpoint. all-in still contribution, just if Yes, impact portfolio yes, so negative [ph] simple strip the The positive X.X to guide the way impact is you organic right? [XXX] even at exactly. includes M&A that the But the at exits our out of midpoint, the we're of and is, at it of

was we any Now, portfolio make improve profile action, that's we were just bold you strategic that strong had That helping have. purely to it's the – growth credit given guys for taking not to margin sure exits. taking context the

strong back when the range. want up more for is numbers we're you organic X% you we're adjustment businesses None for that importantly, strategic investing positive our off even So, that that's a give those to exits. underlying credit in, against coming two-year, to one-time that, those organic. year, a right, X.X%. take a growth think that, same our portfolio for us you pure all adjust of if it zero really And would about get point if But of

of that the And benefits. those time the taking that. the it's I to right is the exactly business, given actions portfolio we're seeing on think be strength the – Obviously, doing

half the are platforms areas than terms than go As in we're just company. that those average of the average They're relevant we growth company growing GP a have of products exiting as of reminder, less that forward. much and just are the of not the strategic less in

benefits, efficiency with come cetera. organizational so, operational efficiency benefits, also et And they

much go we're that make for our that us. And the us so, customers move they're for needle make in as just we forward areas resources and going most that to the and stronger those focusing sure investments and

last Yes. And the – just other comment. one

right? the and example a mentioned This there. get strength This is taking up You us a execution for sort revenue and great just Parata of is strong you the of synergies unique, You that onetime what acquired. little adjustment forecast. in

of again, So, think of I managing, the it's generating and how we're that. just illustrative kind tuck-in benefits from we're

our add of exit portfolio all points will this basis, we growth from XX on contribution tuck-in the to basis as acquisitions will Parata, about do the anniversary an organic it we year. we As

you. Thank

Joanne Our from next Wuensch will come question Citi. with

is open. Your line

for Good morning question. taking and the thank you

Good Veritor’s utilization all increase during a quarter? revenue there do for And now? the or plan the you of placed other picture, things? A pandemic testing? of once. you cetera, questions. on and exits, stop those bigger there XXX BD you. impact a What were lot And all to planned things that exits? et to you If rate of What MAX’s, for BD Thank stop for then sold of the up them taking in how happens and your And goes basis at thank morning price miscellaneous was mean couple the does organic the planned points? growth is

the on Dave MAX. Okay. Great first and for Chris question. the with Why two can don't then take we Veritor, start

Yes.

so Joanne, Q evening come it's there last to mitigation. this right, will consistently inflation out in the pricing we we about, pricing, shared What So, have. relates and aftermarket. we've disclosed it thing And will we as as the – be think is

improvement, of leverage. really growth we're focused is the what so, driving portfolio mix, volume on strength cost And and

significant basis point XXX All inflation. to are of mitigating contributors those the dynamics

last something in done You'll probably of terms we've year. consistent what see

you through of at year end the played able accelerated be day. it to the If think that of how last But out, year. the you'll see

a significantly to I profile but question portfolio, always we a the is portfolio, There's of is, weren't year, make at look There's in made the GP mean, in simple take These adjustments In answer terms to really market products. smaller Tom these strategic your were The alternatives. this onetime as nature. decision you deep our portfolio reduced. described.

freeze up costs. and these Removing capacity other

infrastructure a products, lot it quality All of support. sure to require thinking regulatory up tie not other shipping and they still of as support, those support, being of there's relates

lift this the benefit basis But we been would to question results get. yes, XXX better beyond So, roughly there's have doing our simply, points stopped if that, just year. GP you answer by your

This quarter little a light. was

don't to was basis absorb future quarter. things and we in smaller this we're We one-time even about beyond the the a points. We about. nature in in It points doing talk XX anticipate that would just estimating basis do XXX But that as not closer year. from still full-year, view these

[indiscernible] These products. And in we on focus a relevant like plus, given we've X.X% that see would we and obviously, so exited that we the those revenues. before have again, that, not repeating very we are don't some but as procedures just have washing delivering again. our things do Chris those to examples We've spaces not future. role instruments orthopedic And for do plans continue on Yes. or discrete said, in to

those the quarter and Just made is one we thing after Chris as together. comments opening as price today, volume we did see comment just that think market role of you see volume the the very this reinforce in about two a strong and to of price close the that

as at As that's it right? indicative something business. we then our and of we volume, Because volume, ongoing look organic out of, well, we at that's look sales take kind really flu-COVID not

you strong COVID-flu, in X% excluding overall at when look quarter. it's volume And that digits, volume growth, nearly mid-single the organic

those Veritor it further I something also about reagent positive to made as in color see MAXs, something that growth business. on know that's continuing so, MAX And you very When absorption. you'll see comments more see to come we reports share across double-digit comes we're out, and the don't that But the to that? continue why Dave very some strong some had earlier

what the the question. I for exactly BD Veritor We're installed right. those numbers thanks through We've given Joanne, Yes, around not increase. did base mean, and specifics pandemic, MAX very pleased. And are. you're obviously,

today. a so of it XXX(k). to those our we got is I COVID combination on our for authorizations if converting now, actually to continue We platforms and that lot Veritor ship down, And for the assays emergency right break focus

would approved for point flu that which will B, testing. anchor you A, of flu platform the if obviously, for really clearway a COVID, that create infectious RSV, really once is done, care A, leave Veritor, with like, nice assays And disease Strep

So our that focus there. is

big For automation sample-to-answer that integration window and result. of BD an is complete from its platform sample hour the MAX, that to one benefits two labs within attribute of sees to a three

starting adoption the and just the We our when IVD COVID assays. regular combination rest pandemic now testing. placed drive And think about MAXs of to during we're for many then menu, you the of

our emergency really there installed One use are penetration to assay and MAX authorization base during got EUAs moving eight seen momentum And MAX we for that traction well. and two that] is [it's quad utilization us growth. perform pandemic, double-digit XXX(k) So, MAX, that IVDs strategies. to where the our increase BD regular sort quarters onto BD as on [ph] BD and of of like IVD assay you've those assay

the for question, you Thank Joanne.

Thank you.

Our will Wise Stifel. with come last question Rick from

Your line is open.

Good morning, Rick.

track Listen, your well you're believe. just listening long-term ways I to it. fiscal everything saying Gosh, you targets. you're that hit many Hey, hearing I'm I – and keep today, Chris on accept different XXXX say and said in Tom. both to Hi, Chris. it, I

notion. that supports quarter this think I

again, for I us and is, that XX right question suggesting the is operating top right a line to margin. us for the it Is plus perhaps you're accept today So, you're is saying X% it, – approaching feel it sustainably now going hit I territory? my believe, everything that to you're on XX and like

going? next it's X to operating that's But – it's I if on on of you great in another journey? to And Tom, this – You're going tuck-in part think these Becton for going things M&A be to tuck-in do, role know the is role wrong the that margin which your going Thank you're to your trying in where I latest you. all the are how as question, years. play? to is crazy think that What is internally. if question what ready, maybe take M&A doing conceptually to getting about just a XX%? just target, way My play thoughts going more, is that, role you're don't it's is

focused question. progress, to with pleased both we've our doing. we good and on Thanks very our been strategy, question, We're Rick, execute reshaping obviously the our continuing it's that and and the portfolio for a are on

and an Of just which and – course, we're is to that focus. with well, out ago that spin turned includes Embecta allowing each that's as pleased not long how organization

our about outperforming contributing we mentioned, Systems, talked we'll look supplementing as gain that like with cytometry, strong right? like areas been Chris basis continuing like we've summer, M&A growth. We been Solutions, and the pharmacy in, just that building Medication are Parata Interventional tuck-in anniversaries flow to of momentum super our focus, continued points and to and be XX WAMGR we've innovation ahead, As I'll go Delivery growth underlying of our continued that, how as this back cycle, automation, BDB our like platforms systematically Pharm innovation Solutions

the our just only expense tuck-in. right Mike We have and very unique. accretive team we very to in is be part heads well. and on as game we've continue focused. has this Parata see a that early too, of they're been the of To that from going integration strategy. And synergies to as reminder, to continue been getting well, right, obviously, been margins exceptionally a the improves was funnel, quite have down our strong now M&A start, which And synergies operating dynamic. revenue exclusively executing

right XXX-year-old we So, of really a we've with we've right? of to important executing there, strategy forward. been And we've strategy we're is how track our this our that BD, part as lever and for M&A tuck-in happy record make about had an that part – we've gives which us historically. company. been I M&A, past, the new to really the tuck-in continue that capabilities talked systematic go the not a And We're think in a developed

the did during cash We saw not do down large that going tuck-in beginning pay XXXX, time in of M&A debt. you deals. all of back transformational to the obviously M&A as two Obviously, period was

those era drive quite number forward how innovation. the part a that organic strong with you're this done we've we're profitability where And going on and our to and over equation systematically our stronger a so, complemented growth and focus business that's platforms last by profiles build going seeing three of to cash our how is continue new years,

we in on-time and on we've mention didn't FY our historically first that on-time – in delivery best on-time this right? the new FY hitting again we've half into innovation, is really been milestone on-time We're strong XXXX the this about One call we're records So, comes it is year, beating when and launches ever thing exited progress although And top we quartile. XXXX to made of talking with and had milestone launches. performance. improving our delivery, getting our

of as well, getting look positive we're which so, that really we as out productivity And is organic investments our ahead.

we priority through we make and would do do on talked that, think decisions invest to or growth. confident continue to we've yes, that? be could It and to our it about making exceed jump margin we opportunity this, will I When comes margin, flow be to sure Chris in can let further by XX% we first feel we strong and that in in our XXXX, further invest that. that

have of that We've we discussing number some on the the We for have call participate a day exciting and in. markets time. described them a opportunities lot them of and been

care behind new that, areas improving the connected to around and supporting, patients with smart consistently We're of durable health invest talked growth settings a continue organization around that's future for the shift, in care, outcomes care we've that the going about to disease. the enabling around creating transforming chronic

And our so focus. that's

can at to XX% Let's look we first, there. and then get optionalities from margin

other? Chris, any

Yes.

We're BD few adds. your mean, the equation. two-year we're our a growth, side in our is of clear, proposition small look, I plus not X% point, about organic. the one, unique. I think commitments. maybe offers And Just plus, right, the clearly been changing X.X do talked value what's but that We to in

the has all noted, to plus. try reasons But that ability we that continue for portfolio have a drive X.X%. we the think our want I to commitment and the Tom is

about I underappreciated. that thing maybe that is nice the think is

med in companies but can tech few very very durable this have nice still growth, that de-risked. deliver There's profile. outsized that It's

environment and digits, get it's you we're strong some and in benefit capitalized mid-single while extremely on So, fully a complex posting growth of even reliable, improving this margin very outsized maybe of haven't easy with the committed Tom tuck-in back we're we'll levers margin, M&A isn't talked I'll earnings growth, double-digit to like to about, – go firepower have the forward, going or to which do. really,

cetera. what the consistently in growth, can depending to the sure to right? we moderate that et growth right R&D, want make increase continue that drive We on we we is, areas profile, Obviously, do invest to

So, double-digit of contemplated, certainly able all consistently EPS being growth, that. but in do those factors would to be sort confident

it's So, that's strong growth growth in I a and you're think inflection of differentiated. balance an really seeing nice

de-risked to people you It's find pieces. portfolio. have seeing and those should feel a good. It You're and make execution differentiation hard all

you Thanks both. to

Thanks for the Rick. question,

lines disconnect questions. On thank behalf There further a this day. BD, time, Please audio you. at This this Thank joining does for and are your have today. no of webcast. conclude you wonderful