NEWS
For Further
Information
Contact:
William R. Jellison | FOR IMMEDIATE RELEASE |
Senior Vice President and
Chief Financial Officer
(717) 849-4243
DENTSPLY International Inc.
Reports Record First Quarter Sales and Earnings 2007
York, PA – April 30, 2007 -- DENTSPLY International Inc. (NASDAQ–XRAY) today announced record sales and earnings for the three months ended March 31, 2007.
FINANCIAL RESULTS
Three Months Ended March 31, 2007
Net sales in the first quarter of 2007 increased 9.7% to $472.9 million compared to $431.0 million reported for the first quarter of 2006. Net sales, without precious metal content, increased 10.4% to $423.3 million in the first quarter of 2007, compared to 2006. Net sales without precious metal content, in the first quarter of 2007, were positively affected by strong internal growth in Europe, improved internal growth in the United States and a stronger Euro. Sales of specialty products, including implants, orthodontic products, along with the Company’s all-ceramic Cercon products, all continued to enjoy double-digit sales growth in the quarter.
Net income for the first quarter of 2007 was $58.5 million, or $0.38 per diluted share, an increase of 22.6% compared $0.31 per diluted share in the first quarter of 2006. Net income in the first quarter of 2006 included the net of tax impact of restructuring costs of $3.1 million ($0.02 per diluted share). For a reconciliation of this non-GAAP measure to earnings per share calculated according to GAAP, see the attached table.
COMMENTS FROM MANAGEMENT
2007 First Quarter Results & 2007 Full Year Outlook
Bret Wise, Chairman and Chief Executive Officer, stated “We are pleased to report a strong start for 2007. Our businesses are performing well across most of our product lines and geographies, particularly our specialty products and European business units. These positive trends, along with progress on our key initiatives, give us increased confidence in our outlook for a strong performance in 2007.”
ADDITIONAL INFORMATION
A conference call has been scheduled for Tuesday, May 1, 2007 at 8:30 AM Eastern Time. A live broadcast is available through Shareholder.com by accessing DENTSPLY’s website at www.dentsply.com. The Conference ID # is 1979848. In order to participate in the call, dial (800) 289-0533 (for domestic calls) and (913) 981-5525 (for international calls). An on-line rebroadcast, as well as a transcript of the conference call will be available to the public following the conference call at the DENTSPLY website: www.dentsply.com. A replay will be available for one week following the conference call at (888) 203-1112 (for domestic calls) and (719) 457-0820 (for international calls), Pass-code #1979848.
DENTSPLY designs, develops, manufactures and markets a broad range of products for the dental market. The Company believes that it is the world’s leading manufacturer and distributor of dental prosthetics, precious metal dental alloys, dental ceramics, endodontic instruments and materials, prophylaxis paste, dental sealants, ultrasonic scalers, and crown and bridge materials; the leading United States manufacturer and distributor of dental handpieces, dental x-ray film holders, film mounts and bone substitute/grafting materials; and a leading worldwide manufacturer or distributor of dental injectable anesthetics, impression materials, orthodontic appliances, dental cutting instruments and dental implants. The Company distributes its dental products in over 120 countries under some of the most well-established brand names in the industry.
DENTSPLY is committed to the development of innovative, high quality, cost-effective new products for the dental market.
This press release contains forward-looking information (within the meaning of the Private Securities Litigation Reform Act of 1995) regarding future events or the future financial performance of the Company that involve substantial risks and uncertainties. Actual events or results may differ materially from those in the projections or other forward-looking information set forth herein as a result of certain risk factors. These risk factors include, without limitation; the continued strength of dental markets, the timing, success and market reception for our new and existing products, uncertainty with respect to governmental actions with respect to dental products, outcome of litigation, continued support of our products by influential dental professionals, and changes in the general economic environment that could affect our business. Changes in such assumptions or factors could produce significantly different results.
For an additional description of risk factors, please refer to the Company’s Annual Report on Form 10-K and its subsequent periodic reports on Form 10-Qs filed with the Securities and Exchange Commission.
Non-GAAP Financial Measures
DENTSPLY believes that the non-GAAP financial information provided in this release may be useful to investors for comparison purposes because the Company has historically provided similar information. The non-GAAP financial information should not be considered in isolation from, or as a substitute for, measures of financial performance prepared in accordance with GAAP.
DENTSPLY INTERNATIONAL INC. | ||||
CONSOLIDATED STATEMENTS OF INCOME | ||||
(IN THOUSANDS EXCEPT PER SHARE DATA) | ||||
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| THREE MONTHS ENDED | ||
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| MARCH 31, | ||
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| 2007 |
| 2006 |
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NET SALES |
| $ 472,864 |
| $ 430,996 |
NET SALES - Ex Precious Metals |
| 423,266 |
| 383,415 |
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COST OF PRODUCTS SOLD |
| 226,586 |
| 210,860 |
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GROSS PROFIT |
| 246,278 |
| 220,136 |
% OF NET SALES |
| 52.1% |
| 51.1% |
% OF NET SALES - Ex Precious Metals |
| 58.2% |
| 57.4% |
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SELLING, GENERAL & |
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ADMINISTRATIVE EXPENSES |
| 164,077 |
| 145,431 |
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RESTRUCTURING AND OTHER OPERATING (INCOME) COSTS | 990 |
| 4,697 | |
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INCOME FROM OPERATIONS |
| 81,211 |
| 70,008 |
% OF NET SALES |
| 17.2% |
| 16.2% |
% OF NET SALES - Ex Precious Metals |
| 19.2% |
| 18.3% |
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NET INTEREST AND OTHER NON OPERATING (INCOME) EXPENSE | (2,255) |
| (1,201) | |
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PRE-TAX INCOME |
| 83,466 |
| 71,209 |
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INCOME TAXES |
| 24,994 |
| 21,205 |
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NET INCOME |
| 58,472 |
| 50,004 |
% OF NET SALES |
| 12.4% |
| 11.6% |
% OF NET SALES - Ex Precious Metals |
| 13.8% |
| 13.0% |
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EARNINGS PER SHARE |
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-BASIC |
| $ 0.38 |
| $ 0.32 |
-DILUTIVE |
| $ 0.38 |
| $ 0.31 |
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DIVIDENDS PER SHARE |
| $ 0.0400 |
| $ 0.0350 |
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WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING |
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-BASIC |
| 152,031 |
| 157,998 |
-DILUTIVE |
| 154,564 |
| 161,060 |
DENTSPLY INTERNATIONAL INC. | ||||
CONDENSED BALANCE SHEETS | ||||
(IN THOUSANDS) | ||||
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| MARCH 31, |
| DECEMBER 31, |
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| 2007 |
| 2006 |
ASSETS |
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CURRENT ASSETS: |
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CASH AND CASH EQUIVALENTS |
| $ 104,078 |
| $ 65,064 |
SHORT TERM INVESTMENTS |
| 32,839 |
| 79 |
ACCOUNTS AND NOTES RECEIVABLE-TRADE, NET | 311,005 |
| 290,791 | |
INVENTORIES, NET |
| 247,517 |
| 232,441 |
OTHER CURRENT ASSETS |
| 120,962 |
| 129,816 |
TOTAL CURRENT ASSETS |
| 816,401 |
| 718,191 |
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PROPERTY,PLANT AND EQUIPMENT, NET |
| 331,686 |
| 329,616 |
GOODWILL, NET |
| 998,396 |
| 995,382 |
IDENTIFIABLE INTANGIBLE ASSETS, NET |
| 67,513 |
| 67,648 |
OTHER NONCURRENT ASSETS, NET |
| 80,762 |
| 70,513 |
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TOTAL ASSETS |
| $ 2,294,758 |
| $ 2,181,350 |
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LIABILITIES AND STOCKHOLDERS' EQUITY: |
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CURRENT LIABILITIES |
| $ 264,980 |
| $ 311,434 |
LONG-TERM DEBT |
| 413,355 |
| 367,161 |
OTHER LIABILITIES |
| 233,558 |
| 175,507 |
DEFERRED INCOME TAXES |
| 44,601 |
| 53,191 |
TOTAL LIABILITIES |
| 956,494 |
| 907,293 |
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MINORITY INTEREST IN CONSOLIDATED SUBSIDIARIES |
| 235 |
| 222 |
STOCKHOLDERS' EQUITY |
| 1,338,029 |
| 1,273,835 |
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 2,294,758 |
| $ 2,181,350 | |
| DENTSPLY INTERNATIONAL INC. | |||||
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| (IN THOUSANDS EXCEPT PER SHARE DATA) | |||||
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| Earnings Summary: |
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| The following tables present the reconciliation of reported GAAP net income in total and on a per share basis to the non-GAAP financial measures. | |||||
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| Three Months Ended March 31, 2007 |
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| Income |
| Diluted |
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| Per Share |
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| Net Income |
| $ 58,472 |
| $ 0.38 | |
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| Restructuring Costs, Net of Tax |
| 656 |
| 0.00 | |
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| Income Tax Related Adjustments |
| (232) |
| (0.00) | |
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| Adjusted Non-GAAP Earnings |
| $ 58,896 |
| $ 0.38 | |
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| Three Months Ended March 31, 2006 |
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| Income |
| Diluted |
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| Per Share |
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| Net Income |
| $ 50,004 |
| $ 0.31 | |
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| Restructuring Costs, Net of Tax |
| 3,054 |
| 0.02 | |
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| Income Tax Related Adjustments |
| (135) |
| (0.00) | |
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| Adjusted Non-GAAP Earnings |
| $ 52,923 |
| $ 0.33 | |
| DENTSPLY INTERNATIONAL INC. | |||||
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| (IN THOUSANDS EXCEPT PER SHARE DATA) | |||||
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| Operating Income Summary: |
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| The following tables present the reconciliation of reported GAAP operating income in total and on a percentage of net sales excluding precious metals basis to the non-GAAP financial measures. | |||||
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| Three Months Ended March 31, 2007 |
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| Percentage | |
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| Operating |
| of Net Sales |
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| Income (Expense) |
| Ex Precious Metals |
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| Income from Operations |
| $ 81,211 |
| 19.2% | |
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| Restructuring Costs |
| 990 |
| 0.2% | |
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| Adjusted Non-GAAP Operating Earnings |
| $ 82,201 |
| 19.4% | |
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| Three Months Ended March 31, 2006 |
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| Percentage | |
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| Operating |
| of Net Sales |
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| Income (Expense) |
| Ex Precious Metals |
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| Income from Operations |
| $ 70,008 |
| 18.3% | |
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| Restructuring Costs |
| 4,697 |
| 1.2% | |
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| Adjusted Non-GAAP Operating Earnings |
| $ 74,705 |
| 19.5% | |
