- Second-quarter sales from continuing operations of $3.81
billion increased 3% on a reported basis and 4% on a constant
currency basis, exceeding the company’s previously issued guidance
and delivering constant currency growth across all segments1
- Second-quarter U.S. GAAP2 diluted earnings per share (EPS) from
continuing operations were ($0.62) and adjusted diluted EPS from
continuing operations were $0.68, exceeding the company’s
previously issued guidance
- Baxter increases its full-year sales guidance and now expects
sales growth of approximately 3% on both a reported and constant
currency basis
- Baxter increases its full-year adjusted diluted EPS guidance
and now expects adjusted diluted EPS of $2.93 to $3.011
Baxter International Inc. (NYSE:BAX), a global medtech leader,
today reported results for the second quarter of 2024.
“Baxter’s strategic transformation continues to gain momentum
and drive performance benefiting our broad range of stakeholders,”
said José (Joe) E. Almeida, chair, president and chief executive
officer. “In addition to delivering positive top-line and
bottom-line results in Q2 2024, Baxter’s portfolio of medically
essential products continues to expand with the launch of
leading-edge technologies and differentiated product presentations.
We look forward to building on our positive trajectory and driving
additional value for patients, healthcare providers, shareholders
and our many other stakeholder communities.”
Second-Quarter Financial Results
Worldwide sales from continuing operations in the second quarter
totaled $3.81 billion, an increase of 3% on a reported basis and 4%
on a constant currency basis, exceeding the company’s previously
issued guidance of approximately 1% on a reported basis and 2% to
3% on a constant currency basis. Continuing operations exclude
Baxter’s BioPharma Solutions (BPS) business, which was divested at
the end of the third quarter of 2023.
U.S. sales from continuing operations in the second quarter
totaled $1.80 billion, an increase of 3% year-over-year on a
reported basis. International sales from continuing operations
totaled $2.02 billion, an increase of 3% on a reported basis and 5%
at constant currency rates.
Baxter achieved better-than-expected sales growth across all
segments in the second quarter at constant currency rates.
Double-digit Pharmaceuticals sales growth was driven by the ongoing
impact of new product launches and heightened demand for Drug
Compounding services. Mid-single digit sales growth in Medical
Products & Therapies reflected the benefit of positive pricing
and demand for a wide range of products across the portfolio,
including the first U.S. sales of the Novum IQ large volume
infusion pump with Dose IQ Safety Software. Sales
performance in Healthcare Systems & Technologies (HST) was
driven by increased demand for Care & Connectivity Solutions
products, particularly our Patient Support Systems products. As
expected, HST growth was partially offset by lower sales of Front
Line Care products, due in part to the previously disclosed
dynamics impacting growth in the U.S. primary care market. Growth
in Kidney Care was driven by positive pricing and demand for Acute
Therapies and Peritoneal Dialysis products and was partially offset
by an expected decline in sales of in-center hemodialysis products
due to select product and market exits.
Please see the attached schedules accompanying this press
release for additional details on sales performance in the quarter,
including breakouts by Baxter’s segments.
For the second quarter, total net income (loss) attributable to
Baxter from continuing operations on a U.S. GAAP basis was ($314)
million, or ($0.62) per diluted share. These results include
special items totaling $659 million, primarily related to the
impact of a goodwill impairment charge for the Chronic Therapies
business within the company’s Kidney Care segment,
separation-related costs and intangible amortization, among other
factors. On an adjusted basis, excluding the impact of special
items, income from continuing operations was $0.68 per diluted
share, which exceeded the company’s previously issued guidance of
$0.65 to $0.67 per diluted share. Performance in the quarter was
driven by top-line results and operational efficiencies, which were
partially offset by a negative impact from foreign exchange and a
higher-than-expected tax rate in the quarter.
Corporate Responsibility
Baxter published its 2023 Corporate Responsibility Report in
July 2024, showcasing the company’s dedication to making a
meaningful difference in global healthcare and reporting with
transparency on the environmental, social and governance topics
most important to its stakeholders. The report shares updates on
Baxter’s 2030 Corporate Responsibility Commitment and Goals, which
support an overarching pledge to “Empower our Patients,” “Protect
our Planet” and “Champion our People and Communities.” Among key
accomplishments highlighted in the report, Baxter:
- Invested more than $143 million since 2021 to support
underserved communities through strategic partnerships and
donations.
- Announced a new partnership with UNICEF and a $2.5 million
commitment through the Baxter International Foundation to improve
climate-smart access to safe drinking water and sanitation in
water-challenged regions of Egypt.
- Completed 150 energy conservation projects in 2023, which are
estimated to reduce greenhouse gas (GHG) emissions by approximately
21,100 metric tons carbon dioxide equivalent per year beginning in
2024. This nearly doubles the GHG emissions reduction achieved with
energy projects completed in 2022.3
- Continued to achieve top quartile workplace safety performance,
as measured by total recordable incident rate.
Kidney Care Separation Update
Baxter’s preparations continue for the proposed separation of
its Kidney Care segment. As announced on March 4, 2024, the company
is exploring a potential sale of the Kidney Care business in lieu
of a proposed spinoff of that business. No final decision on the
separation structure has been made. Regardless of the selected
path, Baxter currently expects the separation of its Kidney Care
business to take place in late 2024 or early 2025.
2024 Financial Outlook
For full-year 2024: Baxter now
expects sales growth of approximately 3% on both a reported and
constant currency basis. The company expects adjusted earnings,
before special items, of $2.93 to $3.01 per diluted share.
For third-quarter 2024: The company
expects sales growth of 3% to 4% on a reported basis and 4% to 5%
on a constant currency basis. The company expects adjusted
earnings, before special items, of $0.77 to $0.79 per diluted
share.
A webcast of Baxter’s second-quarter 2024 conference call for
investors can be accessed live from a link in the Investor
Relations section of the company’s website at www.baxter.com
beginning at 7:30 a.m. CDT on Aug. 6, 2024. Please see
www.baxter.com for more information regarding this and future
investor events and webcasts.
About Baxter
Every day, millions of patients, caregivers and healthcare
providers rely on Baxter’s leading portfolio of diagnostic,
critical care, kidney care, nutrition, hospital and surgical
products used across patient homes, hospitals, physician offices
and other sites of care. For more than 90 years, we’ve been
operating at the critical intersection where innovations that save
and sustain lives meet the healthcare providers who make it happen.
With products, digital health solutions and therapies available in
more than 100 countries, Baxter’s employees worldwide are now
building upon the company’s rich heritage of medical breakthroughs
to advance the next generation of transformative healthcare
innovations. To learn more, visit www.baxter.com and follow us on
X, LinkedIn and Facebook.
Non-GAAP Financial Measures
Non-GAAP financial measures may enhance an understanding of the
company’s operations and may facilitate an analysis of those
operations, particularly in evaluating performance from one period
to another. Management believes that non-GAAP financial measures,
when used in conjunction with the results presented in accordance
with U.S. GAAP and the company’s reconciliations to corresponding
U.S. GAAP financial measures (which are included in the tables
accompanying this release), may enhance an investor’s overall
understanding of the company’s past financial performance and
prospects for the future. Management uses these non-GAAP measures
internally in financial planning, to monitor business unit
performance, and, in some cases, for purposes of determining
incentive compensation. This information should be considered in
addition to, and not as substitutes for, information prepared in
accordance with U.S. GAAP.
Net sales growth on a constant currency basis is a non-GAAP
financial measure that provides information on the percentage
change in net sales growth as if foreign currency exchange rates
had remained constant between the prior and current periods.
Other non-GAAP financial measures included in this release and
the accompanying tables (including within the tables that provide
the company’s detailed reconciliations to the corresponding U.S.
GAAP financial measures) are: adjusted gross margin, adjusted
selling, general, and administrative expenses, adjusted research
and development expenses, adjusted other operating expense
(income), net, adjusted operating income (loss), adjusted other
income (expense), net, adjusted income (loss) from continuing
operations before income taxes, adjusted income tax expense
(benefit), adjusted income (loss) from continuing operations,
adjusted income (loss) from discontinued operations, adjusted net
income (loss), adjusted net income (loss) attributable to Baxter
stockholders, adjusted diluted earnings per share from continuing
operations, adjusted diluted earnings per share from discontinued
operations and adjusted diluted earnings per share. Those non-GAAP
financial measures exclude the impact of special items. For the
quarters and six-month periods ended June 30, 2024 and 2023,
special items for one or more periods included intangible asset
amortization, business optimization charges, acquisition and
integration costs, separation-related costs, expenses related to
European medical devices regulation, a goodwill impairment,
investment impairments, and certain tax matters. These items are
excluded because they are highly variable or unusual and of a size
that may substantially impact the company’s reported operations for
a period. Additionally, intangible asset amortization is excluded
as a special item to facilitate an evaluation of current and past
operating performance and is consistent with how management and the
company’s Board of Directors assess performance.
This release and the accompanying tables also include free cash
flow, a non-GAAP financial measure that Baxter defines as operating
cash flow less capital expenditures. Free cash flow is used by
management and the company’s Board of Directors to evaluate the
cash generated from Baxter’s operating activities each period after
deducting its capital spending.
This release also includes forecasts of certain of the
aforementioned non-GAAP measures on a forward-looking basis as part
of the company’s financial outlook for the remainder of 2024.
Baxter calculates forward-looking non-GAAP financial measures based
on forecasts that omit certain amounts that would be included in
GAAP financial measures. For instance, forward-looking adjusted
diluted EPS guidance excludes potential charges or gains that would
be reflected as non-GAAP adjustments to earnings. Baxter provides
forward-looking adjusted diluted EPS guidance because it believes
that this measure provides useful information for the reasons noted
above. Baxter has not provided reconciliations of forward-looking
adjusted EPS guidance to forward-looking GAAP EPS guidance for the
third quarter and full year 2024 because the company is unable to
predict with reasonable certainty the impact of legal proceedings,
future business optimization actions, separation-related costs,
integration-related costs, asset impairments, unusual gains and
losses, and changes in foreign currency exchange rates, and the
related amounts are unavailable without unreasonable efforts (as
specified in the exception provided by Item 10(e)(1)(i)(B) of
Regulation S-K). In addition, Baxter believes that such
reconciliations would imply a degree of precision and certainty
that could be confusing to investors. Such items could have a
substantial impact on GAAP measures of financial performance.
Forward-Looking Statements
This release includes forward-looking statements concerning the
company’s financial results (including the outlook for
third-quarter and full-year 2024) and business development and
regulatory activities. These forward-looking statements are based
on assumptions about many important factors, including the
following, which could cause actual results to differ materially
from those in the forward-looking statements: the company’s ability
to execute and complete strategic initiatives, asset dispositions
and other transactions and development activities, including the
proposed separation of the company’s Kidney Care business, the
company’s plans to simplify its manufacturing footprint and the
timing for such transactions, the ability to satisfy any applicable
conditions and the expected proceeds, consideration and realization
of anticipated benefits; failure to accurately forecast or achieve
the company’s short- and long-term financial performance and goals
(including with respect to the company’s strategic initiatives and
other actions) and related impacts on our liquidity; the company’s
ability to execute on its capital allocation plans, including the
company’s debt repayment plans, the timing and amount of any
dividends, share repurchases and divestiture proceeds and, if the
company proceeds with the separation of the Kidney Care business in
the form of a spinoff, the capital structure of the public company
that would be formed (and the resulting capital structure for the
remaining company); the company’s ability to successfully integrate
acquisitions; the impact of global economic conditions (including,
among other things, inflation levels, interest rates, financial
market volatility, banking crises, the potential for a recession,
the war in Ukraine, the conflict in the Middle East (including
attacks on merchant ships in the Red Sea), tensions amongst China,
Taiwan and the U.S., and the potential for escalation of these
conflicts, the related economic sanctions being imposed globally in
response to the conflicts and potential trade wars and global
public health crises, pandemics and epidemics or the anticipation
of any of the foregoing, on the company’s operations and on the
company’s employees, customers, suppliers, and foreign governments
in countries in which the company operates; downgrades to the
company’s credit ratings or ratings outlooks, or withdrawals by
rating agencies from rating us and the company’s indebtedness, and
the impact on the company’s funding costs and liquidity; the impact
of any goodwill, intangible asset or other long-lived asset
impairments on the company’s operating results; product development
risks, including satisfactory clinical performance and obtaining
and maintaining required regulatory approvals (including as a
result of evolving regulatory requirements or the withdrawal or
resubmission of any pending applications), the ability to
manufacture at appropriate scale and the general unpredictability
associated with the product development cycle; regulatory agency
inspections, product quality or patient safety issues leading to
product recalls, withdrawals, labeling changes, launch delays,
warning letters, import bans, denial of import certifications,
sanctions, seizures, litigation or declining sales, including the
focus on evaluating product portfolios for the potential presence
or formation of nitrosamines; future actions of, or failures to act
or delays in acting by, FDA, the European Medicines Agency or any
other regulatory body or government authority (including the SEC,
Department of Justice or the Attorney General of any State) that
could delay, limit or suspend product development, manufacturing or
sale or result in seizures, recalls, injunctions, monetary
sanctions or criminal or civil liabilities; demand and market
acceptance risks for, and competitive pressures related to, new and
existing products, challenges with the company’s ability to
accurately predict changing consumer preferences and future
expenditures and inventory levels, and challenges with the
company’s ability to monetize new and existing products and
services, the impact of those products on quality and patient
safety concerns and the need for ongoing training and support for
our products; breaches, including by cyber-attack, data leakage,
unauthorized access or theft, or failures of or vulnerabilities in,
the company’s information technology systems or products; the
continuity, availability and pricing of acceptable raw materials
and component parts, the company’s ability to pass some or all of
these costs to the company’s customers through recent price
increases or otherwise, and the related continuity of the company’s
manufacturing and distribution and those of the company’s
suppliers; inability to create additional production capacity in a
timely manner or the occurrence of other manufacturing,
sterilization or supply difficulties, including as a result of
natural disaster, war, terrorism, global public health crises and
epidemics/pandemics, regulatory actions or otherwise; the company’s
ability to finance and develop new products or enhancements on
commercially acceptable terms or at all; loss of key employees
(including those involved with any key strategic actions), the
occurrence of labor disruptions (including as a result of labor
disagreements under bargaining agreements or national trade union
agreements or disputes with works councils) or the inability to
attract, develop, retain and engage employees; failures with
respect to the company’s quality, compliance or ethics programs;
future actions of third parties, including third-party payers and
the company’s customers and distributors (including GPOs and IDNs);
changes to legislation and regulation and other governmental
pressures in United States and globally, including the cost of
compliance and potential penalties for purported noncompliance
thereof, including new or amended laws, rules and regulations as
well as the impact of healthcare reform and its implementation,
suspension, repeal, replacement, amendment, modification and other
similar actions undertaken by the United States or foreign
governments, including with respect to pricing, reimbursement,
taxation and rebate policies; the outcome of pending or future
litigation; the impact of competitive products and pricing,
including generic competition, drug reimportation and disruptive
technologies; global regulatory, trade and tax policies, including
with respect to climate change and other sustainability matters;
the ability to protect or enforce the company’s patents or other
proprietary rights (including trademarks, copyrights, trade secrets
and know-how) or where the patents of third parties prevent or
restrict the company’s manufacture, sale or use of affected
products or technology; fluctuations in foreign exchange and
interest rates; any changes in law concerning the taxation of
income (whether with respect to current or future tax reform);
actions by tax authorities in connection with ongoing tax audits;
and other risks identified in Baxter’s most recent filings on Form
10-K and Form 10-Q and other SEC filings, all of which are
available on Baxter’s website. Baxter does not undertake to update
its forward-looking statements unless otherwise required by the
federal securities laws.
Baxter, Dose IQ and Novum IQ are trademarks of Baxter
International Inc.
Any other trademarks or product brands appearing herein are the
property of their respective owners.
________________________________
1Sales growth at constant currency rates
and adjusted diluted EPS, as well as forecasts of those items on a
forward-looking basis, are non-GAAP financial measures. See the
“Non-GAAP Financial Measures” section below for information about
the non-GAAP financial measures included in this release and see
the accompanying tables to this press release for reconciliations
of those non-GAAP measures to the corresponding U.S. GAAP
measures.
2Generally Accepted Accounting
Principles
3Estimated greenhouse gas emissions
reductions are calculated for the full calendar year following
project implementation.
BAXTER INTERNATIONAL
INC.
Consolidated Statements of
Income (Loss)
(unaudited)
(in millions, except per share
and percentage data)
Three Months Ended June 30,
2024
2023
Change
NET SALES
$
3,812
$
3,707
3%
COST OF SALES
2,381
2,596
(8)%
GROSS MARGIN
1,431
1,111
29%
% of Net Sales
37.5
%
30.0
%
7.5 pts
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES
1,021
964
6%
% of Net Sales
26.8
%
26.0
%
0.8 pts
RESEARCH AND DEVELOPMENT
EXPENSES
173
165
5%
% of Net Sales
4.5
%
4.5
%
0.0 pts
GOODWILL IMPAIRMENT
430
—
NM
OTHER OPERATING INCOME, NET
(1
)
(1
)
0%
OPERATING LOSS
(192
)
(17
)
NM
% of Net Sales
(5.0
)%
(0.5
)%
(4.5) pts
INTEREST EXPENSE, NET
85
124
(31)%
OTHER (INCOME) EXPENSE, NET
(20
)
42
NM
LOSS FROM CONTINUING OPERATIONS BEFORE
INCOME TAXES
(257
)
(183
)
40%
INCOME TAX EXPENSE
54
10
NM
% of Loss from Continuing Operations
Before Income Taxes
(21.0
)%
(5.5
)%
(15.5) pts
LOSS FROM CONTINUING OPERATIONS
(311
)
(193
)
61%
INCOME FROM DISCONTINUED OPERATIONS,
NET OF TAX
—
54
(100)%
NET LOSS
(311
)
(139
)
NM
NET INCOME ATTRIBUTABLE TO
NONCONTROLLING INTERESTS
3
2
50%
NET LOSS ATTRIBUTABLE TO BAXTER
STOCKHOLDERS
$
(314
)
$
(141
)
NM
LOSS FROM CONTINUING OPERATIONS PER
COMMON SHARE
Basic
$
(0.62
)
$
(0.39
)
59%
Diluted
$
(0.62
)
$
(0.39
)
59%
INCOME FROM DISCONTINUED OPERATIONS PER
COMMON SHARE
Basic
$
0.00
$
0.11
(100)%
Diluted
$
0.00
$
0.11
(100)%
LOSS PER COMMON SHARE
Basic
$
(0.62
)
$
(0.28
)
NM
Diluted
$
(0.62
)
$
(0.28
)
NM
WEIGHTED-AVERAGE NUMBER OF SHARES
OUTSTANDING
Basic
510
506
Diluted
510
506
ADJUSTED OPERATING INCOME (excluding
special items)¹
$
522
$
489
7%
ADJUSTED INCOME FROM CONTINUING
OPERATIONS (excluding special items)¹
$
348
$
282
23%
ADJUSTED INCOME FROM DISCONTINUED
OPERATIONS (excluding special items)¹
$
—
$
55
(100)%
ADJUSTED NET INCOME ATTRIBUTABLE TO
BAXTER STOCKHOLDERS (excluding special items)¹
$
345
$
335
3%
ADJUSTED DILUTED EPS FROM CONTINUING
OPERATIONS (excluding special items)¹
$
0.68
$
0.55
24%
ADJUSTED DILUTED EPS FROM DISCONTINUED
OPERATIONS (excluding special items)¹
$
0.00
$
0.11
(100)%
ADJUSTED DILUTED EPS (excluding special
items)¹
$
0.68
$
0.66
3%
1 Refer to page 9 for a description of the
adjustments and a reconciliation to U.S. GAAP measures.
NM - Not Meaningful
BAXTER INTERNATIONAL
INC.
Description of Adjustments and
Reconciliation of U.S. GAAP to Non-GAAP Measures
(unaudited, in
millions)
The company’s U.S. GAAP results
for the three months ended June 30, 2024 included special items
which impacted the U.S. GAAP measures as follows:
Gross Margin
Selling, General and
Administrative Expenses
Research and Development
Expenses
Goodwill Impairment
Operating Income (Loss)
Income (Loss) From Continuing
Operations Before Income Taxes
Income Tax Expense (Benefit)
Income (Loss) From Continuing
Operations
Net Income (Loss)
Net Income (Loss) Attributable to
Baxter Stockholders
Diluted Earnings Per Share from
Continuing Operations
Diluted Earnings Per Share
Reported
$
1,431
$
1,021
$
173
$
430
$
(192
)
$
(257
)
$
54
$
(311
)
$
(311
)
$
(314
)
$
(0.62
)
$
(0.62
)
Reported percent of net sales (or
effective tax rate for income tax expense)
37.5
%
26.8
%
4.5
%
11.3
%
(5.0
)%
(6.7
)%
(21.0
)%
(8.2
)%
(8.2
)%
(8.2
)%
Intangible asset amortization
115
(52
)
—
—
167
167
38
129
129
129
0.25
0.25
Business optimization items1
12
(11
)
3
—
20
20
5
15
15
15
0.03
0.03
Acquisition and integration items2
—
(6
)
—
—
6
6
1
5
5
5
0.01
0.01
Separation-related costs3
1
(79
)
(1
)
—
81
81
14
67
67
67
0.13
0.13
European medical devices regulation4
10
—
—
—
10
10
2
8
8
8
0.02
0.02
Goodwill impairment5
—
—
—
(430
)
430
430
—
430
430
430
0.84
0.84
Tax matters7
—
—
—
—
—
—
(5
)
5
5
5
0.01
0.01
Adjusted
$
1,569
$
873
$
175
$
—
$
522
$
457
$
109
$
348
$
348
$
345
$
0.68
$
0.68
Adjusted percent of net sales (or
effective tax rate for income tax expense)
41.2
%
22.9
%
4.6
%
0.0
%
13.7
%
12.0
%
23.9
%
9.1
%
9.1
%
9.1
%
Reported
Adjusted
Net income (loss)
$
(311
)
$
348
Less: Net income attributable to
noncontrolling interests
3
3
Net income (loss) attributable to Baxter
stockholders
$
(314
)
$
345
Weighted-average diluted shares as
reported
510
Effect of dilutive securities that were
anti-dilutive to dilutive EPS as reported
1
Weighted-average diluted shares as
adjusted
511
The company’s U.S. GAAP results for the
three months ended June 30, 2023 included special items which
impacted the U.S. GAAP measures as follows:
Gross Margin
Selling, General and
Administrative Expenses
Other Operating Income, Net
Operating Income (Loss)
Other (Income) Expense, Net
Income (Loss) From Continuing
Operations Before Income Taxes
Income Tax Expense (Benefit)
Income (Loss) From Continuing
Operations
Income From Discontinued
Operations
Net Income (Loss)
Net Income (Loss) Attributable to
Baxter Stockholders
Diluted Earnings Per Share from
Continuing Operations
Diluted Earnings Per Share from
Discontinued Operations
Diluted Earnings Per Share
Reported
$
1,111
$
964
$
(1
)
$
(17
)
$
42
$
(183
)
$
10
$
(193
)
$
54
$
(139
)
$
(141
)
$
(0.39
)
$
0.11
$
(0.28
)
Reported percent of net sales (or
effective tax rate for income tax expense)
30.0
%
26.0
%
0.0
%
(0.5
)%
1.1
%
(4.9
)%
(5.5
)%
(5.2
)%
1.5
%
(3.7
)%
(3.8
)%
Intangible asset amortization
105
(52
)
—
157
—
157
38
119
—
119
119
0.23
0.00
0.23
Business optimization items1
266
(27
)
—
293
—
293
43
250
—
250
250
0.49
0.00
0.49
Acquisition and integration items2
—
(8
)
1
7
—
7
2
5
—
5
5
0.01
0.00
0.01
Separation-related costs3
4
(33
)
—
37
—
37
—
37
8
45
45
0.07
0.02
0.09
European medical devices regulation4
12
—
—
12
—
12
4
8
—
8
8
0.02
0.00
0.02
Investment impairments6
—
—
—
—
(20
)
20
5
15
—
15
15
0.03
0.00
0.03
Tax matters7
—
—
—
—
—
—
(41
)
41
(7
)
34
34
0.08
(0.01
)
0.07
Adjusted
$
1,498
$
844
$
—
$
489
$
22
$
343
$
61
$
282
$
55
$
337
$
335
$
0.55
$
0.11
$
0.66
Adjusted percent of net sales (or
effective tax rate for income tax expense)
40.4
%
22.8
%
0.0
%
13.2
%
0.6
%
9.3
%
17.8
%
7.6
%
1.5
%
9.1
%
9.0
%
Reported
Adjusted
Income (loss) from continuing
operations
$
(193
)
$
282
Less: Net income attributable to
noncontrolling interests
2
2
Income (loss) from continuing operations
attributable to Baxter stockholders
$
(195
)
$
280
Weighted-average diluted shares as
reported
506
Effect of dilutive securities that were
anti-dilutive to dilutive EPS as reported
2
Weighted-average diluted shares as
adjusted
508
1
The company’s results in 2024 and 2023
included costs related to programs to optimize its organization and
cost structure. In 2024, these costs primarily related to
third-party costs incurred to support the transformation of certain
general and administrative functions, property, plant, and
equipment impairments in connection with the transfer of a
manufacturing production line as part of its initiatives to
optimize its global manufacturing and supply chain organization,
and costs to centralize certain of its research and development
activities into a new location. In 2023, these costs primarily
related to the company's implementation of its new operating model,
the integration of its acquisition of Hill-Rom Holdings, Inc.
(Hillrom), and the decision to cease production of dialyzers at one
of its U.S.-based manufacturing facilities, which resulted in a
$243 million noncash impairment of property, plant and equipment in
the second quarter of the prior year period.
2
The company’s results in 2024 and 2023
included integration-related items comprised of Hillrom acquisition
and integration expenses. In 2023 those costs were partially offset
by net gains from changes in the fair value of contingent
consideration liabilities.
3
The company's results in 2024 and 2023
included separation-related costs primarily related to external
advisors supporting its activities to prepare for the proposed
separation of its Kidney Care segment, which are reported in
continuing operations. The company's results in 2023 also included
separation-related costs related to the sale of its BioPharma
Solutions (BPS) business, which are reported in discontinued
operations.
4
The company’s results in 2024 and 2023
included incremental costs to comply with the European Union’s
medical device regulations for previously registered products,
which primarily consist of contractor costs and other direct
third-party costs. The company considers the adoption of these
regulations to be a significant one-time regulatory change and
believes that the costs of initial compliance for previously
registered products over the implementation period are not
indicative of its core operating results.
5
The company's results in 2024 included a
charge related to a goodwill impairment of the company's Chronic
Therapies reporting unit within its Kidney Care segment.
6
The company's results in 2023 included
losses from non-marketable investments in several early stage
companies, consisting of $23 million of noncash impairment
write-downs, partially offset by a $3 million gain from the sale of
an investment.
7
The company’s results in 2024 included
income tax expenses resulting from internal reorganization
transactions related to the proposed separation of its Kidney Care
segment. The company’s results in 2023 included a reallocation of
income tax expense between discontinued operations and continuing
operations resulting from the application of intraperiod tax
allocation to its adjusted results in an interim period.
For more information on the company's use
of non-GAAP financial measures, please see the Non-GAAP Financial
Measures section of this press release.
BAXTER INTERNATIONAL
INC.
Consolidated Statements of
Income (Loss)
(unaudited)
(in millions, except per share
and percentage data)
Six Months Ended June 30,
2024
2023
Change
NET SALES
$
7,404
$
7,220
3%
COST OF SALES
4,586
4,834
(5)%
GROSS MARGIN
2,818
2,386
18%
% of Net Sales
38.1
%
33.0
%
5.1 pts
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES
2,048
1,959
5%
% of Net Sales
27.7
%
27.1
%
0.6 pts
RESEARCH AND DEVELOPMENT
EXPENSES
349
329
6%
% of Net Sales
4.7
%
4.6
%
0.1 pts
GOODWILL IMPAIRMENT
430
—
NM
OTHER OPERATING INCOME, NET
(4
)
(14
)
(71)%
OPERATING INCOME (LOSS)
(5
)
112
NM
% of Net Sales
(0.1
)%
1.6
%
(1.7) pts
INTEREST EXPENSE, NET
163
241
(32)%
OTHER (INCOME) EXPENSE, NET
(27
)
40
NM
LOSS FROM CONTINUING OPERATIONS BEFORE
INCOME TAXES
(141
)
(169
)
(17)%
INCOME TAX EXPENSE
131
24
NM
% of Loss from Continuing Operations
Before Income Taxes
(92.9
)%
(14.2
)%
NM
LOSS FROM CONTINUING OPERATIONS
(272
)
(193
)
41%
INCOME FROM DISCONTINUED OPERATIONS,
NET OF TAX
—
99
(100)%
NET LOSS
(272
)
(94
)
NM
NET INCOME ATTRIBUTABLE TO
NONCONTROLLING INTERESTS
5
3
67%
NET LOSS ATTRIBUTABLE TO BAXTER
STOCKHOLDERS
$
(277
)
$
(97
)
NM
INCOME (LOSS) FROM CONTINUING
OPERATIONS PER COMMON SHARE
Basic
$
(0.54
)
$
(0.39
)
38%
Diluted
$
(0.54
)
$
(0.39
)
38%
INCOME FROM DISCONTINUED OPERATIONS PER
COMMON SHARE
Basic
$
0.00
$
0.20
(100)%
Diluted
$
0.00
$
0.20
(100)%
NET INCOME (LOSS) PER COMMON
SHARE
Basic
$
(0.54
)
$
(0.19
)
NM
Diluted
$
(0.54
)
$
(0.19
)
NM
WEIGHTED-AVERAGE NUMBER OF SHARES
OUTSTANDING
Basic
509
506
Diluted
509
506
ADJUSTED OPERATING INCOME (excluding
special items)¹
$
1,037
$
928
12%
ADJUSTED INCOME FROM CONTINUING
OPERATIONS (excluding special items)¹
$
681
$
531
28%
ADJUSTED INCOME FROM DISCONTINUED
OPERATIONS (excluding special items)¹
$
—
$
104
(100)%
ADJUSTED NET INCOME ATTRIBUTABLE TO
BAXTER STOCKHOLDERS (excluding special items)¹
$
676
$
632
7%
ADJUSTED DILUTED EPS FROM CONTINUING
OPERATIONS (excluding special items)¹
$
1.33
$
1.04
28%
ADJUSTED DILUTED EPS FROM DISCONTINUED
OPERATIONS (excluding special items)¹
$
0.00
$
0.21
(100)%
ADJUSTED DILUTED EPS (excluding special
items)¹
$
1.33
$
1.25
6%
1Refer to page 11 for a description of the
adjustments and a reconciliation to U.S. GAAP measures.
NM - Not Meaningful
BAXTER INTERNATIONAL
INC.
Description of Adjustments and
Reconciliation of U.S. GAAP to Non-GAAP Measures
(unaudited, in
millions)
The company’s U.S. GAAP results for the
six months ended June 30, 2024 included special items which
impacted the U.S. GAAP measures as follows:
Gross Margin
Selling, General and
Administrative Expenses
Research and Development
Expenses
Goodwill Impairment
Operating Income (Loss)
Income (Loss) From Continuing
Operations Before Income Taxes
Income Tax Expense (Benefit)
Income (Loss) From Continuing
Operations
Net Income (Loss)
Net Income (Loss) Attributable to
Baxter Stockholders
Diluted Earnings Per Share From
Continuing Operations
Diluted Earnings Per Share
Reported
$
2,818
$
2,048
$
349
$
430
$
(5
)
$
(141
)
$
131
$
(272
)
$
(272
)
$
(277
)
$
(0.54
)
$
(0.54
)
Reported percent of net sales (or
effective tax rate for income tax expense)
38.1
%
27.7
%
4.7
%
5.8
%
(0.1
)%
(1.9
)%
(92.9
)%
(3.7
)%
(3.7
)%
(3.7
)%
Intangible asset amortization
229
(104
)
—
—
333
333
78
255
255
255
0.50
0.50
Business optimization items1
26
(38
)
(13
)
—
77
77
20
57
57
57
0.11
0.11
Acquisition and integration items2
1
(10
)
—
—
11
11
2
9
9
9
0.02
0.02
Separation-related costs3
5
(167
)
(1
)
—
173
173
27
146
146
146
0.29
0.29
European medical devices regulation4
18
—
—
—
18
18
4
14
14
14
0.03
0.03
Goodwill impairment5
—
—
—
(430
)
430
430
—
430
430
430
0.84
0.84
Tax Matters6
—
—
—
—
—
—
(42
)
42
42
42
0.08
0.08
Adjusted
$
3,097
$
1,729
$
335
$
—
$
1,037
$
901
$
220
$
681
$
681
$
676
$
1.33
$
1.33
Adjusted percent of net sales (or
effective tax rate for income tax expense)
41.8
%
23.4
%
4.5
%
0.0
%
14.0
%
12.2
%
24.4
%
9.2
%
9.2
%
9.1
%
Reported
Adjusted
Net income (loss)
$
(272
)
$
681
Less: Net income attributable to
noncontrolling interests
5
5
Net income (loss) attributable to Baxter
stockholders
$
(277
)
$
676
Weighted-average diluted shares as
reported
509
Effect of dilutive securities that were
anti-dilutive to dilutive EPS as reported
1
Weighted-average diluted shares as
adjusted
510
The company’s U.S. GAAP results for the
six months ended June 30, 2023 included special items which
impacted the U.S. GAAP measures as follows:
Gross Margin
Selling, General and
Administrative Expenses
Research and Development
Expenses
Other Operating Income, Net
Operating Income
Other Expense, Net
Income (Loss) From Continuing
Operations Before Income Taxes
Income Tax Expense
Income (Loss) From Continuing
Operations
Income From Discontinued
Operations, Net of Tax
Net Income (Loss)
Net Income (Loss) Attributable to
Baxter Stockholders
Diluted Earnings Per Share From
Continuing Operations
Diluted Earnings Per Share From
Discontinued Operations
Diluted Earnings Per Share
Reported
$
2,386
$
1,959
$
329
$
(14
)
$
112
$
40
$
(169
)
$
24
$
(193
)
$
99
$
(94
)
$
(97
)
$
(0.39
)
$
0.20
$
(0.19
)
Reported percent of net sales (or
effective tax rate for income tax expense)
33.0
%
27.1
%
4.6
%
(0.2
)%
1.6
%
0.6
%
(2.3
)%
(14.2
)%
(2.7
)%
1.4
%
(1.3
)%
(1.3
)%
Intangible asset amortization
215
(104
)
—
—
319
—
319
71
248
—
248
248
0.49
0.00
0.49
Business optimization items1
301
(119
)
(7
)
—
427
—
427
73
354
—
354
354
0.70
0.00
0.70
Acquisition and integration items2
—
(14
)
—
14
—
—
—
—
—
—
—
—
0.00
0.00
0.00
Separation-related costs3
5
(41
)
—
—
46
—
46
—
46
15
61
61
0.09
0.03
0.12
European medical devices regulation4
24
—
—
—
24
—
24
7
17
—
17
17
0.03
0.00
0.03
Investment impairments6
—
—
—
—
—
(20
)
20
5
15
—
15
15
0.03
0.00
0.03
Tax matters7
—
—
—
—
—
—
—
(44
)
44
(10
)
34
34
0.09
(0.02
)
0.07
Adjusted
$
2,931
$
1,681
$
322
$
—
$
928
$
20
$
667
$
136
$
531
$
104
$
635
$
632
$
1.04
$
0.21
$
1.25
Adjusted percent of net sales (or
effective tax rate for income tax expense)
40.6
%
23.3
%
4.5
%
0.0
%
12.9
%
0.3
%
9.2
%
20.4
%
7.4
%
1.4
%
8.8
%
8.8
%
Reported
Adjusted
Income (loss) from continuing
operations
$
(193
)
$
531
Less: Net income attributable to
noncontrolling interests
3
3
Income (loss) from continuing operations
attributable to Baxter stockholders
$
(196
)
$
528
Weighted-average diluted shares as
reported
506
Effect of dilutive securities that were
anti-dilutive to dilutive EPS as reported
1
Weighted-average diluted shares as
adjusted
507
1.
The company’s results in 2024 and 2023
included costs related to programs to optimize its organization and
cost structure. In 2024, these costs primarily related to a program
to centralize certain of its research and development activities
into a new location, property plant and equipment impairments in
connection with the transfer of a manufacturing production line as
part of its initiatives to optimize its global manufacturing and
supply chain organization, third party costs incurred to support
the transformation of certain general and administrative functions,
and, to a lesser extent, the implementation of a new operating
model intended to streamline and simplify its operations. In 2023,
these costs primarily related to the company's implementation of
its new operating model, the integration of its acquisition of
Hillrom, and the decision to cease production of dialyzers at one
of its U.S.-based manufacturing facilities, which resulted in a
$243 million noncash impairment of property, plant and equipment in
the second quarter of the prior year period.
2.
The company’s results in 2024 and 2023
included integration-related items comprised of Hillrom acquisition
and integration expenses. In 2023 those costs are offset by net
gains from changes in the fair value of contingent consideration
liabilities.
3.
The company's results in 2024 and 2023
included separation-related costs primarily related to external
advisors supporting its activities to prepare for the proposed
separation of its Kidney Care segment, which are reported in
continuing operations. The company's results in 2023 also included
separation-related costs related to the sale of its BioPharma
Solutions (BPS) business, which are reported in discontinued
operations.
4.
The company’s results in 2024 and 2023
included incremental costs to comply with the European Union’s
medical device regulations for previously registered products,
which primarily consist of contractor costs and other direct
third-party costs. The company considers the adoption of these
regulations to be a significant one-time regulatory change and
believes that the costs of initial compliance for previously
registered products over the implementation period are not
indicative of its core operating results.
5.
The company's results in 2024 included a
charge related to a goodwill impairment of the company's Chronic
Therapies reporting unit within its Kidney Care segment.
6.
The company's results in 2023 included
losses from non-marketable investments in several early stage
companies, consisting of $23 million of noncash impairment
write-downs, partially offset by a $3 million gain from the sale of
an investment.
7.
The company’s results in 2024 included
income tax expenses resulting from internal reorganization
transactions related to the proposed separation of its Kidney Care
segment. The company’s results in 2023 included a valuation
allowance to reduce the carrying amount of a deferred tax asset for
a tax basis step-up related to previously enacted Swiss tax
legislation, as well as tax costs from separation-related
activities and a reallocation of income tax expense between
discontinued operations and continuing operations resulting from
the application of intraperiod tax allocation to its adjusted
results in an interim period.
For more information on the company's use of non-GAAP financial
measures, please see the Non-GAAP Financial Measures section of
this press release.
BAXTER INTERNATIONAL
INC.
Sales by Operating
Segment
(unaudited)
($ in millions)
The Medical Products and Therapies segment includes sales of our
sterile IV solutions, infusion systems, administration sets,
parenteral nutrition therapies and surgical hemostat, sealant and
adhesion prevention products. The Healthcare Systems and
Technologies segment includes sales of our connected care solutions
and collaboration tools, including smart bed systems, patient
monitoring systems and diagnostic technologies, respiratory health
devices and advanced equipment for the surgical space, including
operating room integration technologies, precision positioning
devices and other accessories. The Pharmaceuticals segment includes
sales of specialty injectable pharmaceuticals, inhaled anesthesia
and drug compounding. The Kidney Care segment includes sales of
chronic and acute dialysis therapies and services, including
peritoneal dialysis, hemodialysis, continuous renal replacement
therapies (CRRT) and other organ support therapies. Other sales not
allocated to a segment primarily include sales of products and
services provided directly through certain of our manufacturing
facilities.
Three Months Ended June 30,
% Growth @ Actual Rates
% Growth @ Constant Rates
Six Months Ended June 30,
% Growth @ Actual Rates
% Growth @ Constant Rates
2024
2023
2024
2023
Infusion Therapies and Technologies
$
1,045
$
1,004
4
%
5
%
$
2,011
$
1,915
5
%
5
%
Advanced Surgery
277
272
2
%
4
%
540
518
4
%
6
%
Medical Products and Therapies
1,322
1,276
4
%
5
%
2,551
2,433
5
%
5
%
Care and Connectivity Solutions
452
436
4
%
4
%
854
865
(1
)%
(2
)%
Front Line Care
296
307
(4
)%
(4
)%
561
609
(8
)%
(8
)%
Healthcare Systems and Technologies
748
743
1
%
1
%
1,415
1,474
(4
)%
(4
)%
Injectables and Anesthesia
341
332
3
%
4
%
669
637
5
%
6
%
Drug Compounding
261
218
20
%
20
%
511
436
17
%
18
%
Pharmaceuticals
602
550
9
%
11
%
1,180
1,073
10
%
11
%
Chronic Therapies
917
928
(1
)%
1
%
1,805
1,812
(0
)%
1
%
Acute Therapies
201
188
7
%
9
%
415
376
10
%
12
%
Kidney Care
1,118
1,116
0
%
3
%
2,220
2,188
1
%
3
%
Other
22
22
0
%
(5
)%
38
52
(27
)%
(29
)%
Total - Continuing Operations
$
3,812
$
3,707
3
%
4
%
$
7,404
$
7,220
3
%
3
%
In connection with our segment change in the third quarter of
2023, we reclassified $8 million and $16 million of sales from the
second quarter and first six months of 2023, respectively, from
Chronic Therapies to Acute Therapies to conform to the current
period presentation.
Constant currency growth is a non-GAAP measure. For more
information on the company’s use of non-GAAP financial measures,
please see the Non-GAAP Financial Measures section of this press
release.
BAXTER INTERNATIONAL
INC.
Segment Operating
Income
(unaudited)
($ in millions)
Three Months Ended June 30,
Six Months Ended June 30,
2024
2023
2024
2023
Medical Products and Therapies
$
238
$
264
$
465
$
461
% of Segment Net Sales
18.0
%
20.7
%
18.2
%
18.9
%
Healthcare Systems and Technologies
120
100
187
212
% of Segment Net Sales
16.0
%
13.5
%
13.2
%
14.4
%
Pharmaceuticals
75
89
153
176
% of Segment Net Sales
12.5
%
16.2
%
13.0
%
16.4
%
Kidney Care
83
55
242
112
% of Segment Net Sales
7.4
%
4.9
%
10.9
%
5.1
%
Other
9
6
13
13
Total
525
514
1,060
974
Unallocated corporate costs
(3
)
(25
)
(23
)
(46
)
Intangible asset amortization expense
(167
)
(157
)
(333
)
(319
)
Goodwill impairment
(430
)
—
(430
)
—
Business optimization items
(20
)
(293
)
(77
)
(427
)
Acquisition and integration items
(6
)
(7
)
(11
)
—
Separation-related costs
(81
)
(37
)
(173
)
(46
)
European Medical Devices Regulation
(10
)
(12
)
(18
)
(24
)
Total operating income (loss)
(192
)
(17
)
(5
)
112
Interest expense, net
85
124
163
241
Other (income) expense, net
(20
)
42
(27
)
40
Loss from continuing operations before
income taxes
$
(257
)
$
(183
)
$
(141
)
$
(169
)
BAXTER INTERNATIONAL
INC.
Operating Segment Sales by
U.S. and International
(unaudited)
($ in millions)
Three Months Ended June 30,
2024
2023
% Growth
U.S.
International
Total
U.S.
International
Total
U.S.
International
Total
Infusion Therapies and Technologies
$
579
$
466
$
1,045
$
570
$
434
$
1,004
2
%
7
%
4
%
Advanced Surgery
150
127
277
150
122
272
0
%
4
%
2
%
Medical Products and Therapies
729
593
1,322
720
556
1,276
1
%
7
%
4
%
Care and Connectivity Solutions
332
120
452
311
125
436
7
%
(4
)%
4
%
Front Line Care
218
78
296
227
80
307
(4
)%
(3
)%
(4
)%
Healthcare Systems and Technologies
550
198
748
538
205
743
2
%
(3
)%
1
%
Injectables and Anesthesia
197
144
341
182
150
332
8
%
(4
)%
3
%
Drug Compounding
—
261
261
—
218
218
0
%
20
%
20
%
Pharmaceuticals
197
405
602
182
368
550
8
%
10
%
9
%
Chronic Therapies
228
689
917
230
698
928
(1
)%
(1
)%
(1
)%
Acute Therapies
77
124
201
64
124
188
20
%
0
%
7
%
Kidney Care
305
813
1,118
294
822
1,116
4
%
(1
)%
0
%
Other
16
6
22
16
6
22
0
%
0
%
0
%
Total - Continuing Operations
$
1,797
$
2,015
$
3,812
$
1,750
$
1,957
$
3,707
3
%
3
%
3
%
BAXTER INTERNATIONAL
INC.
Operating Segment Sales by
U.S. and International
(unaudited)
($ in millions)
Six Months Ended June 30,
2024
2023
% Growth
U.S.
International
Total
U.S.
International
Total
U.S.
International
Total
Infusion Therapies and Technologies
$
1,105
$
906
$
2,011
$
1,084
$
831
$
1,915
2
%
9
%
5
%
Advanced Surgery
297
243
540
294
224
518
1
%
8
%
4
%
Medical Products and Therapies
1,402
1,149
2,551
1,378
1,055
2,433
2
%
9
%
5
%
Care and Connectivity Solutions
610
244
854
609
256
865
0
%
(5
)%
(1
)%
Front Line Care
413
148
561
448
161
609
(8
)%
(8
)%
(8
)%
Healthcare Systems and Technologies
1,023
392
1,415
1,057
417
1,474
(3
)%
(6
)%
(4
)%
Injectables and Anesthesia
388
281
669
355
282
637
9
%
(0
)%
5
%
Drug Compounding
—
511
511
—
436
436
0
%
17
%
17
%
Pharmaceuticals
388
792
1,180
355
718
1,073
9
%
10
%
10
%
Chronic Therapies
454
1,351
1,805
459
1,353
1,812
(1
)%
(0
)%
(0
)%
Acute Therapies
162
253
415
128
248
376
27
%
2
%
10
%
Kidney Care
616
1,604
2,220
587
1,601
2,188
5
%
0
%
1
%
Other
27
11
38
40
12
52
(33
)%
(8
)%
(27
)%
Total - Continuing Operations
$
3,456
$
3,948
$
7,404
$
3,417
$
3,803
$
7,220
1
%
4
%
3
%
BAXTER INTERNATIONAL
INC.
Reconciliation of Non-GAAP
Financial Measure
Operating Cash Flow to Free
Cash Flow
(unaudited)
($ in millions)
Six Months Ended June 30,
2024
2023
Cash flows from operations – continuing
operations
$
278
$
780
Cash flows from investing activities -
continuing operations
(257
)
(326
)
Cash flows from financing activities -
continuing operations
(1,076
)
(492
)
Cash flows from operations - continuing
operations
$
278
$
780
Capital expenditures - continuing
operations
(292
)
(328
)
Free cash flow - continuing
operations
$
(14
)
$
452
Six Months Ended June 30,
2024
2023
Cash flows from operations – discontinued
operations
$
—
$
50
Cash flows from investing activities -
discontinued operations
—
(17
)
Cash flows from operations - discontinued
operations
$
—
$
50
Capital expenditures - discontinued
operations
—
(17
)
Free cash flow - discontinued
operations
$
—
$
33
Six Months Ended June 30,
2024
2023
Cash flows from operations – Total
Baxter
$
278
$
830
Cash flows from investing activities -
Total Baxter
(257
)
(343
)
Cash flows from financing activities -
Total Baxter
(1,076
)
(492
)
Cash flows from operations - Total
Baxter
$
278
$
830
Capital expenditures - Total Baxter
(292
)
(345
)
Free cash flow - Total Baxter
$
(14
)
$
485
Free cash flow is a non-GAAP measure. For
more information on the company’s use of non-GAAP financial
measures, please see the Non-GAAP Financial Measures section of
this press release.
BAXTER INTERNATIONAL
INC.
Reconciliation of Non-GAAP
Financial Measure
Change in Net Sales Growth As
Reported to Constant Currency Sales Growth
From the Three Months Ended
June 30, 2023 to the Three Months Ended June 30, 2024
(unaudited)
Net Sales Growth
As Reported
FX
Constant Currency Sales
Growth*
Infusion Therapies and Technologies
4
%
1
%
5
%
Advanced Surgery
2
%
2
%
4
%
Medical Products and Therapies
4
%
1
%
5
%
Care and Connectivity Solutions
4
%
0
%
4
%
Front Line Care
(4
)%
0
%
(4
)%
Healthcare Systems and
Technologies
1
%
0
%
1
%
Injectables and Anesthesia
3
%
1
%
4
%
Drug Compounding
20
%
0
%
20
%
Pharmaceuticals
9
%
2
%
11
%
Chronic Therapies
(1
)%
2
%
1
%
Acute Therapies
7
%
2
%
9
%
Kidney Care
0
%
3
%
3
%
Other
0
%
(5
)%
(5
)%
Total - Continuing Operations
3
%
1
%
4
%
*Totals may not add across due to
rounding
Constant currency sales growth is a
non-GAAP measure. For more information on the company’s use of
non-GAAP financial measures, please see the Non-GAAP Financial
Measures section of this press release.
BAXTER INTERNATIONAL
INC.
Reconciliation of Non-GAAP
Financial Measure
Change in Net Sales Growth As
Reported to Constant Currency Sales Growth
From The Six Months Ended June
30, 2023 to The Six Months Ended June 30, 2024
(unaudited)
Net Sales Growth As Reported
FX
Constant Currency Sales
Growth*
Infusion Therapies and Technologies
5
%
0
%
5
%
Advanced Surgery
4
%
2
%
6
%
Medical Products and Therapies
5
%
0
%
5
%
Care and Connectivity Solutions
(1
)%
(1
)%
(2
)%
Front Line Care
(8
)%
0
%
(8
)%
Healthcare Systems and
Technologies
(4
)%
0
%
(4
)%
Injectables and Anesthesia
5
%
1
%
6
%
Drug Compounding
17
%
1
%
18
%
Pharmaceuticals
10
%
1
%
11
%
Chronic Therapies
(0
)%
1
%
1
%
Acute Therapies
10
%
2
%
12
%
Kidney Care
1
%
2
%
3
%
Other
(27
)%
(2
)%
(29
)%
Total - Continuing Operations
3
%
0
%
3
%
*Totals may not add across due to
rounding
Constant currency sales growth is a
non-GAAP measure. For more information on the company’s use of
non-GAAP financial measures, please see the Non-GAAP Financial
Measures section of this press release.
BAXTER INTERNATIONAL
INC.
Reconciliation of Non-GAAP
Financial Measures
Projected Third Quarter and
Full Year 2024 U.S. GAAP Sales Growth to Projected Constant
Currency Sales Growth and Projected Third Quarter and Full Year
2024 Adjusted Earnings Per Share
(unaudited)
Sales Growth Guidance
Q3 2024*
FY 2024*
Sales growth - U.S. GAAP
3% - 4%
~ 3%
Foreign Exchange
>50 bps
<50 bps
Sales growth - Constant currency
4% - 5%
~ 3%
Adjusted Earnings Per Share
Guidance
Q3 2024
FY 2024
Adjusted diluted EPS
$0.77 - $0.79
$2.93 - $3.01
*Totals may not foot due to
rounding
Baxter calculates forward-looking non-GAAP financial measures
based on forecasts that omit certain amounts that would be included
in GAAP financial measures. For instance, forward-looking adjusted
diluted EPS guidance excludes potential charges or gains that would
be reflected as non-GAAP adjustments to earnings. Baxter provides
forward-looking adjusted diluted EPS guidance because it believes
that this measure provides useful information for the reasons noted
in the accompanying release. Baxter has not provided
reconciliations of forward-looking adjusted EPS guidance to
forward-looking GAAP EPS guidance for the third quarter and full
year of 2024 because the company is unable to predict with
reasonable certainty the impact of legal proceedings, future
business optimization actions, separation-related costs,
integration-related costs, asset impairments, unusual gains and
losses, and changes in foreign currency exchange rates, and the
related amounts are unavailable without unreasonable efforts (as
specified in the exception provided by Item 10(e)(1)(i)(B) of
Regulation S-K). In addition, Baxter believes that such
reconciliations would imply a degree of precision and certainty
that could be confusing to investors. Such items could have a
substantial impact on GAAP measures of financial performance.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240801697827/en/
Media Contact Andrea Johnson, (224) 948-5353
media@baxter.com
Investor Contact Clare Trachtman, (224) 948-3020
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