Non-GAAP Financial Measures Disclosure with EU Medical Device Regulation Adjustments

SEC EDGAR: SEC Investigations

Published April 20th, 2026

Detected April 3rd, 2026

Summary

Becton Dickinson (BD) filed Exhibit 99.1 with the SEC disclosing non-GAAP financial measures and their reconciliation to GAAP results, including a new adjustment category for costs related to EU Medical Device Regulation (EU MDR) and EU In Vitro Diagnostic Regulation (IVDR) compliance for fiscal year 2024. The exhibit explains that EU regulatory initiative-related costs are excluded from non-GAAP measures as one-time costs to establish initial compliance with the New EU Medical Devices Regulations.

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What changed

BD's Exhibit 99.1 discloses its methodology for calculating non-GAAP financial measures, including a new exclusion category for European regulatory initiative-related costs associated with establishing initial compliance with EU MDR and IVDR. These costs, which include labor, consulting, R&D, clinical trials, supplies, and travel expenses, are classified as duplicative and one-time expenses limited to a specific period. The adjustments primarily affected Cost of products sold and Research and development expense. The disclosure is consistent with SEC Regulation S-K requirements for non-GAAP financial measures.

Public companies and medical device manufacturers that use non-GAAP measures should ensure their reconciliation disclosures clearly distinguish EU regulatory compliance costs and follow BD's approach of characterizing such costs as non-recurring, one-time expenses. Investors should review BD's consolidated financial statements and publicly filed reports in their entirety and compare BD's non-GAAP methodology to industry peers, as BD cautions that similar terms used by other companies may reflect different adjustments.

Source document (simplified)

EX-99.1 2 ex991042026.htm EX-99.1 Document
Exhibit 99.1 Non-GAAP Financial Measures Included in the Financial Tables The unaudited financial information included herein contains certain financial measures that differ from those presented in accordance with generally accepted accounting principles in the United States ("non-GAAP measures"). These non-GAAP measures include adjustments to certain line items in the attached recast historical financial information to adjust for purchase accounting adjustments; integration, restructuring, and transaction costs; financing impacts; separation-related items; certain regulatory costs; certain product, litigation, and other items; and the income tax benefit of these items, which affect the comparability of period-over-period calculations of diluted earnings per share. In particular, adjustments for fiscal year 2024 exclude the impact of European regulatory initiative-related costs, which represent costs incurred to develop processes and systems to establish initial compliance with the European Union Medical Device Regulation and the European Union In Vitro Diagnostic Medical Device Regulation (collectively, the “New EU Medical Devices Regulations”), which represent a significant, unusual change to the existing regulatory framework. We consider the excluded European regulatory initiative-related costs to be duplicative of previously incurred costs and/or one-off costs related to establishing initial compliance with such regulatory regimes, and in each case are limited to a specific period of time. These expenses relate to establishing initial compliance with the New EU Medical Devices Regulations and include the cost of labor, other services and consulting (in particular, research and development and clinical trials) and supplies, travel and other miscellaneous costs. These costs were primarily recorded in Cost of products sold and Research and development expense. These adjustments are consistent with the adjustments made by BD when it reported its operating results for the periods presented. BD management believes that the use of non-GAAP measures to adjust for items that are considered by management to be outside of BD’s underlying operational results or that affect period-to-period comparability helps investors to gain a better understanding of our performance year-over-year, to analyze underlying trends in our businesses, to analyze our operating results and to understand future prospects. Management uses these non-GAAP financial measures to measure and forecast the Company’s performance, especially when comparing such results to prior periods or forecasts. We believe presenting such measures provides investors with greater transparency to the information used by BD management for its operational decision-making and for comparison to other companies within the medical technology industry. Although BD’s management believes non-GAAP results are useful in evaluating the performance of its business, its reliance on these measures is limited since items excluded from such measures may have a material impact on BD’s net income, earnings per share or cash flows calculated in accordance with GAAP. Therefore, management typically uses non-GAAP results in conjunction with GAAP results to address these limitations. BD strongly encourages investors to review its consolidated financial statements and publicly filed reports in their entirety and cautions investors that the non-GAAP measures used by BD may differ from similar measures used by other companies, even when similar terms are used to identify such measures. Non-GAAP measures should not be considered replacements for, and should be read together with, the most comparable GAAP financial measures. Reconciliations of these and other non-GAAP measures to the comparable GAAP measures are included in the attached financial tables. Within the attached financial tables presented, certain columns and rows may not add due to the use of rounded numbers. Earnings per share amounts presented are calculated from the underlying amounts. Page 1
BECTON DICKINSON AND COMPANY CONDENSED CONSOLIDATED INCOME STATEMENTS (Unaudited; Amounts in millions, except share and per share data)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Fiscal Year 2026 | | | | | | Fiscal Year 2025 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fiscal Year 2024 | | |
| | | | | | | Three Months Ended December 31, 2025 | | | | | | Three Months Ended December 31, 2024 | | | | | | Three Months Ended March 31, 2025 | | | | | | Three Months Ended June 30, 2025 | | | | | | Three Months Ended September 30, 2025 | | | | | | Twelve Months Ended September 30, 2025 | | | | | | Twelve Months Ended September 30, 2024 | | |
| REVENUES | | | | | | $ | 4,486 | | | | | $ | 4,333 | | | | | $ | 4,480 | | | | | $ | 4,726 | | | | | $ | 5,005 | | | | | $ | 18,544 | | | | | $ | 16,820 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Cost of products sold | | | | | | 2,434 | | | | | | 2,536 | | | | | | 2,619 | | | | | | 2,490 | | | | | | 2,639 | | | | | | 10,285 | | | | | | 9,372 | | |
| Selling and administrative expense | | | | | | 1,229 | | | | | | 1,155 | | | | | | 1,117 | | | | | | 1,163 | | | | | | 1,208 | | | | | | 4,643 | | | | | | 4,250 | | |
| Research and development expense | | | | | | 235 | | | | | | 243 | | | | | | 232 | | | | | | 230 | | | | | | 264 | | | | | | 970 | | | | | | 896 | | |
| Integration, restructuring and transaction expense | | | | | | 108 | | | | | | 89 | | | | | | 93 | | | | | | 96 | | | | | | 125 | | | | | | 403 | | | | | | 365 | | |
| Other operating expense, net | | | | | | 13 | | | | | | 28 | | | | | | 35 | | | | | | 7 | | | | | | 232 | | | | | | 302 | | | | | | 223 | | |
| TOTAL OPERATING COSTS AND EXPENSES | | | | | | 4,018 | | | | | | 4,051 | | | | | | 4,097 | | | | | | 3,986 | | | | | | 4,469 | | | | | | 16,603 | | | | | | 15,106 | | |
| OPERATING INCOME | | | | | | 468 | | | | | | 282 | | | | | | 383 | | | | | | 740 | | | | | | 536 | | | | | | 1,941 | | | | | | 1,713 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest expense | | | | | | (153) | | | | | | (155) | | | | | | (150) | | | | | | (152) | | | | | | (155) | | | | | | (613) | | | | | | (528) | | |
| Interest income | | | | | | 4 | | | | | | 22 | | | | | | 5 | | | | | | 4 | | | | | | 4 | | | | | | 35 | | | | | | 162 | | |
| Other expense, net | | | | | | (7) | | | | | | (13) | | | | | | (36) | | | | | | (23) | | | | | | (33) | | | | | | (105) | | | | | | (20) | | |
| INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | | | | | | 311 | | | | | | 136 | | | | | | 201 | | | | | | 568 | | | | | | 352 | | | | | | 1,258 | | | | | | 1,327 | | |
| Income tax provision (benefit) | | | | | | 1 | | | | | | (10) | | | | | | 43 | | | | | | 118 | | | | | | 7 | | | | | | 158 | | | | | | 273 | | |
| NET INCOME FROM CONTINUING OPERATIONS | | | | | | 311 | | | | | | 147 | | | | | | 158 | | | | | | 450 | | | | | | 346 | | | | | | 1,100 | | | | | | 1,054 | | |
| Income from discontinued operations, net of tax | | | | | | 71 | | | | | | 157 | | | | | | 150 | | | | | | 123 | | | | | | 148 | | | | | | 577 | | | | | | 651 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| NET INCOME | | | | | | $ | 382 | | | | | $ | 303 | | | | | $ | 308 | | | | | $ | 574 | | | | | $ | 493 | | | | | $ | 1,678 | | | | | $ | 1,705 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| BASIC EARNINGS PER SHARE | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Income from Continuing Operations | | | | | | $ | 1.09 | | | | | $ | 0.51 | | | | | $ | 0.55 | | | | | $ | 1.57 | | | | | $ | 1.21 | | | | | $ | 3.83 | | | | | $ | 3.64 | |
| Income from Discontinued Operations | | | | | | 0.25 | | | | | | 0.54 | | | | | | 0.52 | | | | | | 0.43 | | | | | | 0.51 | | | | | | 2.01 | | | | | | 2.25 | | |
| Basic Earnings per Share | | | | | | $ | 1.34 | | | | | $ | 1.05 | | | | | $ | 1.07 | | | | | $ | 2.00 | | | | | $ | 1.72 | | | | | $ | 5.83 | | | | | $ | 5.88 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DILUTED EARNINGS PER SHARE | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Income from Continuing Operations | | | | | | $ | 1.09 | | | | | $ | 0.50 | | | | | $ | 0.55 | | | | | $ | 1.57 | | | | | $ | 1.20 | | | | | $ | 3.81 | | | | | $ | 3.62 | |
| Income from Discontinued Operations | | | | | | 0.25 | | | | | | 0.54 | | | | | | 0.52 | | | | | | 0.43 | | | | | | 0.51 | | | | | | 2.00 | | | | | | 2.24 | | |
| Diluted Earnings per Share | | | | | | $ | 1.34 | | | | | $ | 1.04 | | | | | $ | 1.07 | | | | | $ | 2.00 | | | | | $ | 1.72 | | | | | $ | 5.82 | | | | | $ | 5.86 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| AVERAGE SHARES OUTSTANDING (in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Basic | | | | | | 285,582 | | | | | | 289,505 | | | | | | 287,293 | | | | | | 287,170 | | | | | | 286,612 | | | | | | 287,648 | | | | | | 289,763 | | |
| Diluted | | | | | | 285,845 | | | | | | 290,389 | | | | | | 287,737 | | | | | | 287,223 | | | | | | 287,118 | | | | | | 288,509 | | | | | | 291,009 | | |
Page 2
BECTON DICKINSON AND COMPANY SUPPLEMENTAL INFORMATION RECONCILIATION OF REPORTED RESULTS TO ADJUSTED RESULTS (Unaudited; Amounts in millions, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended December 31, 2025 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Reported (GAAP) | | | Purchase accounting adjustments
(A) | | | Integration costs
(B) | | | Restructuring costs
(B) | | | Separation-related items
(D) | | | Product, litigation, and other items
(E) | | | TSA/LSA total | | | Income tax benefit of special items | | | Adjusted (Non-GAAP) | | |
| See Footnotes on Page 10 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| REVENUES | | | $ | 4,486 | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 4,486 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Gross margin | | | 2,052 | | | 384 | | | — | | | — | | | — | | | — | | | — | | | — | | | 2,436 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Selling and administrative expense | | | 1,229 | | | — | | | — | | | — | | | — | | | (6) | | | — | | | — | | | 1,223 | | |
| Research and development expense | | | 235 | | | — | | | — | | | — | | | — | | | (3) | | | — | | | — | | | 232 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| OPERATING INCOME | | | 468 | | | 384 | | | 36 | | | 71 | | | 1 | | | 19 | | | (2) | | | — | | | 978 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest expense | | | (149) | | | (1) | | | — | | | — | | | — | | | — | | | — | | | — | | | (150) | | |
| Other (expense) income, net | | | (7) | | | — | | | — | | | — | | | — | | | (11) | | | 2 | | | — | | | (17) | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | | | 311 | | | 383 | | | 36 | | | 71 | | | 1 | | | 8 | | | — | | | — | | | 811 | | |
| Income tax provision | | | 1 | | | — | | | — | | | — | | | — | | | — | | | — | | | 95 | | | 95 | | |
| NET INCOME FROM CONTINUING OPERATIONS | | | $ | 311 | | $ | 383 | | $ | 36 | | $ | 71 | | $ | 1 | | $ | 8 | | $ | — | | $ | (95) | | $ | 716 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS | | | $ | 1.09 | | $ | 1.34 | | $ | 0.13 | | $ | 0.25 | | $ | 0.01 | | $ | 0.03 | | $ | — | | $ | (0.33) | | $ | 2.50 | |
Page 3
BECTON DICKINSON AND COMPANY SUPPLEMENTAL INFORMATION RECONCILIATION OF REPORTED RESULTS TO ADJUSTED RESULTS (Unaudited; Amounts in millions, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended December 31, 2024 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Reported (GAAP) | | | Purchase accounting adjustments
(A) | | | Integration costs
(B) | | | Restructuring costs
(B) | | | Transaction costs
(C) | | | Product, litigation, and other items
(E) | | | TSA/LSA total | | | Income tax benefit of special items | | | Adjusted
(Non-GAAP) | | |
| See Footnotes on Page 10 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| REVENUES | | | $ | 4,333 | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 4,333 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Gross margin | | | 1,797 | | | 562 | | | — | | | — | | | — | | | 28 | | | — | | | — | | | 2,387 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Selling and administrative expense | | | 1,155 | | | (1) | | | — | | | — | | | — | | | (9) | | | — | | | — | | | 1,145 | | |
| Research and development expense | | | 243 | | | — | | | — | | | — | | | — | | | (8) | | | — | | | — | | | 235 | | |
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| OPERATING INCOME | | | 282 | | | 563 | | | 24 | | | 62 | | | 3 | | | 75 | | | (3) | | | — | | | 1,005 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest expense | | | (133) | | | (1) | | | — | | | — | | | — | | | — | | | — | | | — | | | (134) | | |
| Other (expense) income, net | | | (13) | | | — | | | — | | | — | | | — | | | (3) | | | 3 | | | — | | | (14) | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | | | 136 | | | 562 | | | 24 | | | 62 | | | 3 | | | 72 | | | — | | | — | | | 858 | | |
| Income tax (benefit) provision | | | (10) | | | — | | | — | | | — | | | — | | | — | | | — | | | 61 | | | 51 | | |
| NET INCOME FROM CONTINUING OPERATIONS | | | $ | 147 | | $ | 562 | | $ | 24 | | $ | 62 | | $ | 3 | | $ | 72 | | $ | — | | $ | (61) | | $ | 808 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS | | | $ | 0.50 | | $ | 1.93 | | $ | 0.08 | | $ | 0.21 | | $ | 0.01 | | $ | 0.25 | | $ | — | | $ | (0.21) | | $ | 2.78 | |
Page 4
BECTON DICKINSON AND COMPANY SUPPLEMENTAL INFORMATION RECONCILIATION OF REPORTED RESULTS TO ADJUSTED RESULTS (Unaudited; Amounts in millions, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, 2025 | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Reported (GAAP) | | | Purchase accounting adjustments
(A) | | | Integration costs
(B) | | | Restructuring costs
(B) | | | Product, litigation, and other items
(E) | | | TSA/LSA total | | | Income tax benefit of special items | | | Adjusted
(Non-GAAP) | | |
| See Footnotes on Page 10 | | | | | | | | | | | | | | | | | | | | | | | | | | |
| REVENUES | | | $ | 4,480 | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 4,480 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Gross margin | | | 1,861 | | | 544 | | | — | | | — | | | 87 | | | — | | | — | | | 2,492 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Selling and administrative expense | | | 1,117 | | | — | | | — | | | — | | | 9 | | | — | | | — | | | 1,126 | | |
| Research and development expense | | | 232 | | | — | | | — | | | — | | | (2) | | | — | | | — | | | 230 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| OPERATING INCOME | | | 383 | | | 544 | | | 26 | | | 66 | | | 115 | | | (3) | | | — | | | 1,133 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest expense | | | (146) | | | (1) | | | — | | | — | | | — | | | — | | | — | | | (147) | | |
| Other (expense) income, net | | | (36) | | | — | | | — | | | — | | | 24 | | | 3 | | | — | | | (9) | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | | | 201 | | | 543 | | | 26 | | | 66 | | | 139 | | | — | | | — | | | 977 | | |
| Income tax provision | | | 43 | | | — | | | — | | | — | | | — | | | — | | | 129 | | | 173 | | |
| NET INCOME FROM CONTINUING OPERATIONS | | | $ | 158 | | $ | 543 | | $ | 26 | | $ | 66 | | $ | 139 | | $ | — | | $ | (129) | | $ | 804 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS | | | $ | 0.55 | | $ | 1.89 | | $ | 0.09 | | $ | 0.23 | | $ | 0.48 | | $ | — | | $ | (0.45) | | $ | 2.79 | |
Page 5
BECTON DICKINSON AND COMPANY SUPPLEMENTAL INFORMATION RECONCILIATION OF REPORTED RESULTS TO ADJUSTED RESULTS (Unaudited; Amounts in millions, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, 2025 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Reported (GAAP) | | | Purchase accounting adjustments
(A) | | | Integration costs
(B) | | | Restructuring costs
(B) | | | Transaction costs
(C) | | | Product, litigation, and other items
(E) | | | TSA/LSA total | | | Income tax benefit of special items | | | Adjusted
(Non-GAAP) | | |
| See Footnotes on Page 10 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| REVENUES | | | $ | 4,726 | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 4,726 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Gross margin | | | 2,235 | | | 377 | | | — | | | — | | | — | | | (1) | | | — | | | — | | | 2,612 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Selling and administrative expense | | | 1,163 | | | — | | | — | | | — | | | — | | | (20) | | | — | | | — | | | 1,143 | | |
| Research and development expense | | | 230 | | | — | | | — | | | — | | | — | | | (2) | | | — | | | — | | | 228 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| OPERATING INCOME | | | 740 | | | 378 | | | 37 | | | 57 | | | 1 | | | 26 | | | (3) | | | — | | | 1,237 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest expense | | | (148) | | | (1) | | | — | | | — | | | — | | | — | | | — | | | — | | | (149) | | |
| Other (expense) income, net | | | (23) | | | — | | | — | | | — | | | — | | | 18 | | | 3 | | | — | | | (2) | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | | | 568 | | | 376 | | | 37 | | | 57 | | | 1 | | | 44 | | | — | | | — | | | 1,085 | | |
| Income tax provision | | | 118 | | | — | | | — | | | — | | | — | | | — | | | — | | | 83 | | | 201 | | |
| NET INCOME FROM CONTINUING OPERATIONS | | | $ | 450 | | $ | 376 | | $ | 37 | | $ | 57 | | $ | 1 | | $ | 44 | | $ | — | | $ | (83) | | $ | 884 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS | | | $ | 1.57 | | $ | 1.31 | | $ | 0.13 | | $ | 0.20 | | $ | 0.01 | | $ | 0.15 | | $ | — | | $ | (0.29) | | $ | 3.08 | |
Page 6
BECTON DICKINSON AND COMPANY SUPPLEMENTAL INFORMATION RECONCILIATION OF REPORTED RESULTS TO ADJUSTED RESULTS (Unaudited; Amounts in millions, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, 2025 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Reported (GAAP) | | | Purchase accounting adjustments
(A) | | | Integration costs
(B) | | | Restructuring costs
(B) | | | Separation-related items
(D) | | | Product, litigation, and other items
(E) | | | TSA/LSA total | | | Income tax benefit of special items | | | Adjusted
(Non-GAAP) | | |
| See Footnotes on Page 10 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| REVENUES | | | $ | 5,005 | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 5,005 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Gross margin | | | 2,366 | | | 384 | | | — | | | — | | | — | | | 1 | | | — | | | — | | | 2,751 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Selling and administrative expense | | | 1,208 | | | — | | | — | | | — | | | — | | | (13) | | | — | | | — | | | 1,195 | | |
| Research and development expense | | | 264 | | | — | | | — | | | — | | | — | | | (3) | | | — | | | — | | | 261 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| OPERATING INCOME | | | 536 | | | 384 | | | 41 | | | 84 | | | 3 | | | 247 | | | (4) | | | — | | | 1,292 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest expense | | | (151) | | | (1) | | | — | | | — | | | — | | | — | | | — | | | — | | | (152) | | |
| Other (expense) income, net | | | (33) | | | — | | | — | | | — | | | — | | | 3 | | | 4 | | | — | | | (26) | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | | | 352 | | | 383 | | | 41 | | | 84 | | | 3 | | | 250 | | | — | | | — | | | 1,114 | | |
| Income tax provision | | | 7 | | | — | | | — | | | — | | | — | | | — | | | — | | | 170 | | | 177 | | |
| NET INCOME FROM CONTINUING OPERATIONS | | | $ | 346 | | $ | 383 | | $ | 41 | | $ | 84 | | $ | 3 | | $ | 250 | | $ | — | | $ | (170) | | $ | 937 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS | | | $ | 1.20 | | $ | 1.33 | | $ | 0.14 | | $ | 0.29 | | $ | 0.01 | | $ | 0.87 | | $ | — | | $ | (0.59) | | $ | 3.26 | |
Page 7
BECTON DICKINSON AND COMPANY SUPPLEMENTAL INFORMATION RECONCILIATION OF REPORTED RESULTS TO ADJUSTED RESULTS (Unaudited; Amounts in millions, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Twelve Months Ended September 30, 2025 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Reported (GAAP) | | | Purchase accounting adjustments
(A) | | | Integration costs
(B) | | | Restructuring costs
(B) | | | Transaction costs
(C) | | | Separation-related items
(D) | | | Product, litigation, and other items
(E) | | | TSA/LSA total | | | Income tax benefit of special items | | | Adjusted
(Non-GAAP) | | |
| See Footnotes on Page 10 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| REVENUES | | | $ | 18,544 | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 18,544 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Gross margin | | | 8,258 | | | 1,867 | | | — | | | — | | | — | | | — | | | 115 | | | — | | | — | | | 10,241 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Selling and administrative expense | | | 4,643 | | | (2) | | | — | | | — | | | — | | | — | | | (33) | | | — | | | — | | | 4,609 | | |
| Research and development expense | | | 970 | | | — | | | — | | | — | | | — | | | — | | | (15) | | | — | | | — | | | 955 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| OPERATING INCOME | | | 1,941 | | | 1,869 | | | 127 | | | 270 | | | 6 | | | 3 | | | 463 | | | (12) | | | — | | | 4,666 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest expense | | | (577) | | | (4) | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (582) | | |
| Other (expense) income, net | | | (105) | | | — | | | — | | | — | | | — | | | — | | | 43 | | | 12 | | | — | | | (50) | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | | | 1,258 | | | 1,865 | | | 127 | | | 270 | | | 6 | | | 3 | | | 506 | | | — | | | — | | | 4,034 | | |
| Income tax provision | | | 158 | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 443 | | | 601 | | |
| NET INCOME FROM CONTINUING OPERATIONS | | | $ | 1,100 | | $ | 1,865 | | $ | 127 | | $ | 270 | | $ | 6 | | $ | 3 | | $ | 506 | | $ | — | | $ | (443) | | $ | 3,433 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS | | | $ | 3.81 | | $ | 6.46 | | $ | 0.44 | | $ | 0.93 | | $ | 0.02 | | $ | 0.01 | | $ | 1.75 | | $ | — | | $ | (1.54) | | $ | 11.90 | |
Page 8
BECTON DICKINSON AND COMPANY SUPPLEMENTAL INFORMATION RECONCILIATION OF REPORTED RESULTS TO ADJUSTED RESULTS (Unaudited; Amounts in millions, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Twelve Months Ended September 30, 2024 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | Reported (GAAP) | | | Purchase accounting adjustments
(A) | | | Integration costs
(B) | | | Restructuring costs
(B) | | | Transaction costs
(C) | | | Financing impacts
(C) | | | Separation-related items
(D) | | | Product, litigation, and other items
(E) | | | European regulatory initiative-related costs
(F) | | | TSA/LSA total | | | Income tax benefit of special items | | | Adjusted (Non-GAAP) | | |
| See Footnotes on Page 10 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| REVENUES | | | $ | 16,820 | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | — | | $ | 67 | | $ | — | | $ | — | | $ | — | | $ | 16,887 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Gross margin | | | 7,448 | | | 1,482 | | | — | | | — | | | — | | | — | | | — | | | 115 | | | 43 | | | — | | | — | | | 9,088 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Selling and administrative expense | | | 4,250 | | | 1 | | | — | | | — | | | — | | | — | | | — | | | (56) | | | (1) | | | — | | | — | | | 4,194 | | |
| Research and development expense | | | 896 | | | — | | | — | | | — | | | — | | | — | | | — | | | (4) | | | (54) | | | — | | | — | | | 838 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| OPERATING INCOME | | | 1,713 | | | 1,481 | | | 23 | | | 294 | | | 48 | | | — | | | 13 | | | 393 | | | 98 | | | 27 | | | — | | | 4,091 | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net interest expense | | | (366) | | | (5) | | | — | | | — | | | — | | | (8) | | | — | | | — | | | — | | | — | | | — | | | (379) | | |
| Other expense, net | | | (20) | | | — | | | — | | | — | | | — | | | — | | | — | | | (51) | | | — | | | (27) | | | — | | | (98) | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | | | 1,327 | | | 1,477 | | | 23 | | | 294 | | | 48 | | | (8) | | | 13 | | | 342 | | | 98 | | | — | | | — | | | 3,614 | | |
| Income tax provision | | | 273 | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 267 | | | 540 | | |
| NET INCOME FROM CONTINUING OPERATIONS | | | $ | 1,054 | | $ | 1,477 | | $ | 23 | | $ | 294 | | $ | 48 | | $ | (8) | | $ | 13 | | $ | 342 | | $ | 98 | | $ | — | | $ | (267) | | $ | 3,074 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS | | | $ | 3.62 | | $ | 5.07 | | $ | 0.08 | | $ | 1.01 | | $ | 0.17 | | $ | (0.03) | | $ | 0.05 | | $ | 1.17 | | $ | 0.34 | | $ | — | | $ | (0.92) | | $ | 10.56 | |
Page 9
The reconciliations of reported results to adjusted results on the previous pages reflect the following adjustments that are considered by management to be outside of BD’s underlying operational results or that affect period-to-period comparability: (A) Includes amortization and other adjustments related to the purchase accounting for acquisitions. BD’s amortization expense is primarily recorded in Cost of products sold. (B) Represents costs associated with integration and restructuring activities. These costs are recorded to Integration, restructuring and transaction expense. (C) Represents transaction costs and financing impacts incurred in connection with the Advanced Patient Monitoring acquisition. The transaction costs are recorded to Integration, restructuring and transaction expense, and the financing impacts are recorded to Interest expense and Interest income. (D) Amounts in fiscal years 2026 and 2025 represent costs incurred in connection with the separation of BD's former Biosciences and Diagnostic Solutions business and the combination of the business with Waters Corporation. The amount in fiscal year 2024 represents costs incurred in connection with the separation of BD's former Diabetes Care business. These costs are recorded to Other operating expense, net. (E) Includes certain (income) expense items which are not part of ordinary operations and affect the comparability of the periods presented. Such items may include certain product remediation costs, certain legal matters, certain investment gains and losses, certain asset impairment charges, and certain pension settlement costs. The amounts presented include the following: • Charges of $297 million in fiscal year 2025 related to product liability and certain other legal matters, recorded to Other operating expense, net. The amount in fiscal year 2024 reflects charges related to product liability and certain other legal matters, recorded to Other operating expense, net, including a $175 million charge to accrue an estimated liability for the SEC investigation with respect to, among other things, certain reporting issues involving BD Alaris TM infusion pumps included in SEC disclosures prior to 2021. • Charges to adjust the estimate of future product remediation costs, recorded to Cost of products sold, of $98 million and $38 million in fiscal years 2025 and 2024, respectively. • Charges related to pension settlement costs, recorded to Other expense, net, of $38 million in fiscal year 2025. • The recognition of $67 million in accruals in fiscal year 2024 as an impact to Revenues relating to the Italian government medical device pay back legislation, as well as another legal matter, and which substantially relate to years prior to fiscal year 2024. (F) Represents costs incurred to develop processes and systems to establish initial compliance with the European Union Medical Device Regulation and the European Union In Vitro Diagnostic Medical Device Regulation, which represent a significant, unusual change to the existing regulatory framework. We consider these costs to be duplicative of previously incurred costs and/or one-off costs, which are limited to a specific period of time. These expenses, which are primarily recorded in Cost of products sold and Research and development expense, include the cost of labor, other services and consulting (in particular, research and development and clinical trials) and supplies, travel and other miscellaneous costs. Page 10