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8-K - 8-K - PATTERSON COMPANIES, INC.d161075d8k.htm

Exhibit 99

 

PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

PATTERSON COMPANIES REPORTS FISCAL 2021

FOURTH-QUARTER AND YEAR END OPERATING RESULTS

 

   

Fourth-quarter reported net sales increased 21.4 percent year-over-year to $1.56 billion, and internal sales increased 23.5 percent.

   

Fourth-quarter GAAP earnings of $0.30 per diluted share and adjusted earnings per share of $0.38 per diluted share.

   

Fiscal 2021 reported net sales increased 7.7 percent compared to fiscal 2020, and internal sales increased 8.2 percent.

   

Fiscal 2021 Dental segment internal sales increased 10.4 percent and fiscal 2021 Animal Health segment internal sales increased 7.7 percent.

   

Delivered fiscal 2021 GAAP earnings of $1.61 per diluted share and adjusted earnings1 of $1.91 per diluted share, an increase of 23.2 percent over fiscal 2020.

   

Issues fiscal 2022 GAAP earnings guidance of $1.61 to $1.76 per diluted share and adjusted earnings1 range of $1.90 to $2.05 per diluted share.

St. Paul, Minn. — June 23, 2021 — Patterson Companies, Inc. (Nasdaq: PDCO) today reported consolidated net sales of $1.56 billion (see attached Sales Summary for further details) in its fiscal fourth quarter ended April 24, 2021, an increase of 21.4 percent compared to the same period last year. Internal sales, which are adjusted for the effects of currency translation and changes in product selling relationships, increased 23.5 percent.

Reported net income attributable to Patterson Companies, Inc. for the fourth quarter of fiscal 2021 was $28.8 million, or $0.30 per diluted share, compared to a reported net loss attributable to Patterson Companies, Inc. of $608.6 million, or $6.44 per diluted share, in the fourth quarter of fiscal 2020. Adjusted net income1 attributable to Patterson Companies, Inc., which excludes deal amortization, integration and business restructuring expenses, an investment loss and goodwill impairment totaled $36.6 million for the fourth quarter of fiscal 2021, or $0.38 per diluted share, compared to $41.1 million in the same quarter of fiscal 2020, or $0.43 per diluted share. The reported net income and adjusted net income attributable to Patterson Companies, Inc. for the fourth quarter of fiscal 2021 included the after-tax impact of Covid-related inventory adjustments and a LIFO adjustment, both within our Dental segment, of approximately $18.2 million or $0.19 per diluted share.

“Patterson delivered strong performance during our 2021 fiscal year as we navigated the historic challenges posed by the Covid-19 pandemic to support our customers across our end markets,” said Mark Walchirk, President and CEO of Patterson Companies. “We grew our full-year adjusted EPS by 23 percent over the prior year through driving strong top line growth, operational excellence and disciplined expense management.”

“I am incredibly proud of our entire Patterson team for living our values and supporting our customers and business partners through the challenges of this past year. Looking ahead, we expect business conditions in our end markets to continue improving, and we remain focused on delivering top line growth and margin improvement. Additionally, our strengthened balance sheet provides us with the flexibility to consider strategic investments that will help accelerate growth and value creation for our shareholders.”

Patterson Dental

Reported net sales in our Dental segment for the fourth quarter of fiscal 2021, which represented approximately 40 percent of total company sales, were $616.0 million compared to $409.6 million in the fourth quarter of last year.

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

Internal sales increased 49.1 percent compared to the fiscal 2020 fourth quarter, including 53.1 percent growth in consumables and 63.0 percent growth in equipment and software.

Patterson Animal Health

Reported net sales in our Animal Health segment for the fourth quarter of fiscal 2021, which comprised approximately 60 percent of the company’s total sales, were $939.3 million compared to $853.2 million in the fourth quarter of last year. Internal sales for the segment increased 13.8 percent from the fiscal 2020 fourth quarter with companion animal posting internal sales growth of 29.6 percent compared to the same period one year ago.

Full-Year Fiscal 2021 Results

Consolidated reported net sales for fiscal 2021 totaled $5.91 billion, a 7.7 percent year-over-year increase. Internal sales for fiscal 2021 increased 8.2 percent compared to fiscal 2020. Reported net income attributable to Patterson Companies, Inc. in fiscal 2021 was $156.0 million, or $1.61 per diluted share, compared to a net loss attributable to Patterson Companies, Inc, of $588.4 million, or $6.25 per diluted share in fiscal 2020. Adjusted net income1 attributable to Patterson Companies, Inc., which excludes deal amortization, integration and business restructuring expenses, legal reserve costs, accelerated debt-related costs, investment (gain) loss and goodwill impairment, totaled $185.0 million, or $1.91 per diluted share. This compares to $147.6 million, or $1.55 per diluted share in fiscal 2020, representing a 23.2 percent increase year-over-year.

Balance Sheet and Capital Allocation

During the full year of fiscal 2021, Patterson Companies used $730.5 million of cash from operating activities and collected deferred purchase price receivables of $834.0 million, netting $103.5 million in cash, compared to a total of $297.4 million during the full year of fiscal 2020. The previous year period contained a trade accounts receivable facility amount of $29.0 million. Free cash flow1 (see definition below and attached free cash flow table) generated during fiscal 2021 was $77.7 million, which was $148.9 million lower than fiscal 2020 primarily due to an increased level of working capital during fiscal 2021.

In the fourth quarter of fiscal 2021, Patterson Companies declared a quarterly cash dividend of $0.26 per share. For the full year of fiscal 2021, Patterson returned $75.2 million in cash dividends to shareholders.

Fiscal 2022 Guidance

Patterson Companies today announced its fiscal 2022 earnings guidance, which is provided on both a GAAP and non-GAAP adjusted1 basis:

   

GAAP earnings are expected to be in the range of $1.61 to $1.76 per diluted share.

   

Non-GAAP adjusted earnings1 are expected to be in the range of $1.90 to $2.05 per diluted share.

   

Our non-GAAP adjusted earnings1 guidance excludes the after-tax impact of:

- Deal amortization expenses of approximately $28.2 million ($0.29 per diluted share).

Our guidance is for current operations as well as completed or previously announced acquisitions and does not include the impact of potential future acquisitions, dispositions or similar transactions, if any, or impairments and material restructurings beyond those previously publicly disclosed. Our guidance assumes North American and international market conditions will improve over those experienced in fiscal 2021 and not revert back to the pandemic environment of early fiscal 2021.

1Non-GAAP Financial Measures

The Reconciliation of GAAP to non-GAAP Measures table appearing behind the accompanying financial information is provided to adjust reported GAAP measures, namely operating income (loss), income (loss) before taxes, income

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

tax expense (benefit), net income (loss), net income (loss) attributable to Patterson Companies, Inc. and diluted earnings (loss) per share attributable to Patterson Companies, Inc., for the impact of deal amortization, integration and business restructuring expenses, legal reserve costs, accelerated debt-related costs, discrete tax matters, investment (gain) loss and goodwill impairment, along with the related tax effects of these items.

The term “free cash flow” used in this release is defined as net cash used in operating activities less capital expenditures less the one-time benefit from the initiation of our trade accounts receivables facilities plus the collection of deferred purchase price receivables.

In addition, the term “internal sales” used in this release represents net sales adjusted to exclude the impact of foreign currency and changes in product selling relationships. Foreign currency impact represents the difference in results that is attributable to fluctuations in currency exchange rates the company uses to convert results for all foreign entities where the functional currency is not the U.S. dollar. The company calculates the impact as the difference between the current period results translated using the current period currency exchange rates and using the comparable prior period’s currency exchange rates. The company believes the disclosure of net sales changes in constant currency provides useful supplementary information to investors in light of significant fluctuations in currency rates.

Management believes that these non-GAAP measures may provide a helpful representation of the company’s fourth-quarter and full year performance and enable comparison of financial results between periods where certain items may vary independent of business performance. These non-GAAP financial measures are presented solely for informational and comparative purposes and should not be regarded as a replacement for corresponding, similarly captioned, GAAP measures.

Fourth-Quarter Conference Call and Replay

Patterson Companies’ fiscal 2021 fourth-quarter conference call will start at 8:30 a.m. Eastern today. Investors can listen to a live webcast of the conference call at www.pattersoncompanies.com. The conference call will be archived on the Patterson Companies website. A replay of the fiscal 2021 fourth quarter conference call can be heard for one week at 800-585-8367 and by providing the Conference ID 2782998 when prompted.

About Patterson Companies Inc.

Patterson Companies Inc. (Nasdaq: PDCO) connects dental and animal health customers in North America and the U.K. to the latest products, technologies, services and innovative business solutions that enable operational and professional success. Our comprehensive portfolio, distribution network and supply chain is equaled only by our dedicated, knowledgeable people who deliver unrivalled expertise and unmatched customer service and support.

Learn more: pattersoncompanies.com

This press release contains, and our officers and representatives may from time to time make, certain “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, including statements regarding future financial performance, and the objectives and expectations of management. Forward-looking statements often include words such as “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “seeks” or words of similar meaning, or future or conditional verbs, such as “will,” “should,” “could” or “may.” Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not place undue reliance on any of these forward-looking statements.

Any number of factors could affect our actual results and cause such results to differ materially from those contemplated by any forward-looking statements, including, but not limited to, the following: the effects of the highly competitive dental and animal health supply markets in which we compete; the COVID-19 pandemic and measures taken in response thereto; general economic conditions, including political and economic uncertainty; risks from disruption to our information systems; our ability to comply with restrictive covenants in our amended credit agreement; our dependence on relationships with sales representatives, service technicians and customers; our ability to realize the long-term strategic benefits of our acquisition of Animal Health International; potential disruption of distribution capabilities, including service issues with third-party shippers; our ability to provide our sales force and customers with the latest technology; our dependence on suppliers for the manufacture and supply of the products we sell; material changes in our purchasing relationship with suppliers; the risk that private label sales could adversely affect our relationships with suppliers; our dependence on positive perceptions of Patterson’s reputation; risks inherent in acquiring other businesses; the risk that our acquired technology or developed technology might not be successful in maintaining or gaining customers; litigation risks, including new or unanticipated litigation developments and new or unanticipated regulatory investigations; changes in consumer preferences; regulatory restrictions; the cyclicality of the livestock market; the outbreak of an infectious disease within the production animal or companion animal population; pressure from animal rights groups; adverse changes in supplier rebates; fluctuations in quarterly financial results; volatility in the price of our stock; risks from the expansion of customer purchasing power; increases in over-the-counter sales of companion animal products; the risks inherent in international operations, including currency fluctuations; the effects of health care reform; failure to comply with regulatory requirements and data privacy laws; cyberattacks or other privacy or data security breaches; the risk of the products we sell becoming obsolete or containing undetected errors; volatility in the financial markets; our dependence on our senior management; our dependence on leadership development and succession planning; disruptions from our enterprise resource planning system; risks associated with shareholder activism; the risk of being required to record impairment charges; the risk of audit by tax authorities; risks associated with interest rate fluctuations; and the risk that our governing documents and Minnesota law may discourage takeovers and business combinations. The order in which these factors appear should not be construed to indicate their relative importance or priority. We caution that these factors may not be exhaustive, accordingly, any forward-looking statements contained herein should not be relied upon as a prediction of actual results.

You should carefully consider these and other relevant factors, including those risk factors in Part I, Item 1A, (“Risk Factors”) in our most recent Form 10-K, as amended and supplemented by our Quarterly Report on Form 10-Q for the quarterly period ended October 24, 2020, and information which may be contained in our other filings with the U.S. Securities and Exchange Commission, or SEC, when reviewing any forward-looking statement. Investors should understand it is impossible to predict or identify all such factors or risks. As such, you should not consider the foregoing list, or the risks identified in our SEC filings, to be a complete discussion of all potential risks or uncertainties.

Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We do not undertake any obligation to release publicly any revisions to any forward-looking statements whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

INVESTOR CONTACT:    John M. Wright, Investor Relations
COMPANY:    Patterson Companies Inc.
TEL:    651.686.1364
EMAIL:    investor.relations@pattersoncompanies.com
MEDIA CONTACT:    Patterson Corporate Communications
COMPANY:    Patterson Companies Inc.
TEL:    651.905.3349
EMAIL:    corporate.communications@pattersoncompanies.com
WEB:    pattersoncompanies.com
SOURCE:    Patterson Companies Inc.

# # #

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

PATTERSON COMPANIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

 

     Three Months Ended     Twelve Months Ended  
     April 24,
2021
    April 25,
2020
    April 24,
2021
    April 25,
2020
 

Net sales

   $ 1,561,793   $ 1,286,461   $ 5,912,066   $ 5,490,011

Gross profit

     304,405     294,032     1,203,130     1,197,410

Operating expenses

     267,057     233,440     992,523     1,094,474

Goodwill impairment

           675,055           675,055
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss)

     37,348     (614,463     210,607     (572,119

Other income (expense):

        

Other income (expense), net

     4,028     (10,994     13,608     23,499

Interest expense

     (5,680     (7,467     (24,284     (41,787
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before taxes

     35,696     (632,924     199,931     (590,407

Income tax expense (benefit)

     7,182     (24,127     44,822     (1,040
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

     28,514     (608,797     155,109     (589,367

Net loss attributable to noncontrolling interests

     (241     (211     (872     (921
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) attributable to Patterson Companies, Inc.

   $ 28,755   $ (608,586   $ 155,981   $ (588,446
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings (loss) per share attributable to Patterson Companies, Inc.:

        

Basic

   $ 0.30   $ (6.44   $ 1.63   $ (6.25
  

 

 

   

 

 

   

 

 

   

 

 

 

Diluted

   $ 0.30   $ (6.44   $ 1.61   $ (6.25
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares:

        

Basic

     95,977     94,462     95,599     94,154

Diluted

     97,393     94,462     96,664     94,154

Dividends declared per common share

   $ 0.26   $ 0.26   $ 1.04   $ 1.04

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

PATTERSON COMPANIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

 

     April 24,
2021
     April 25,
2020
 

ASSETS

     

Current assets:

     

Cash and cash equivalents

   $ 143,244    $ 77,944

Receivables, net

     449,235      416,523

Inventory

     736,778      812,194

Prepaid expenses and other current assets

     286,672      236,104
  

 

 

    

 

 

 

Total current assets

     1,615,929      1,542,765

Property and equipment, net

     219,438      303,725

Operating lease right-of-use assets, net

     77,217      79,021

Goodwill and identifiable intangibles, net

     419,576      452,229

Long-term receivables, net and other

     419,351      337,610
  

 

 

    

 

 

 

Total assets

   $ 2,751,511    $ 2,715,350
  

 

 

    

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

     

Current liabilities:

     

Accounts payable

   $ 609,264    $ 862,093

Other accrued liabilities

     294,400      182,099

Operating lease liabilities

     32,252      30,706

Current maturities of long-term debt

     100,750       

Borrowings on revolving credit

     53,000       
  

 

 

    

 

 

 

Total current liabilities

     1,089,666      1,074,898

Long-term debt

     487,545      587,766

Non-current operating lease liabilities

     48,318      49,854

Other non-current liabilities

     161,311      166,388
  

 

 

    

 

 

 

Total liabilities

     1,786,840      1,878,906

Stockholders’ equity

     964,671      836,444
  

 

 

    

 

 

 

Total liabilities and stockholders’ equity

   $ 2,751,511    $ 2,715,350
  

 

 

    

 

 

 

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

PATTERSON COMPANIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

     Twelve Months Ended  
     April 24,
2021
    April 25,
2020
 

Operating activities:

    

Net income (loss)

   $ 155,109   $ (589,367

Adjustments to reconcile net income (loss) to net cash used in operating activities:

    

Depreciation and amortization

     78,896     82,182

Investment gain

           (34,334

Goodwill impairment

           675,055

Non-cash employee compensation

     30,488     37,354

Accelerated amortization of debt issuance costs on early retirement of debt

           8,984

Non-cash losses (gains) and other, net

     1,318      

Change in assets and liabilities:

    

Receivables

     (916,694     (540,065

Inventory

     91,193     (59,258

Accounts payable

     (268,338     219,613

Accrued liabilities

     85,849     25,474

Long term receivables

     (5,801     (7,156

Other changes from operating activities, net

     17,461     (62,026
  

 

 

   

 

 

 

Net cash used in operating activities

     (730,519     (243,544

Investing activities:

    

Additions to property and equipment

     (25,788     (41,809

Collection of deferred purchase price receivables

     833,958     540,944

Other investing activities

     2,493      
  

 

 

   

 

 

 

Net cash provided by investing activities

     810,663     499,135

Financing activities:

    

Dividends paid

     (75,183     (100,442

Proceeds from issuance of long-term debt, net

           296,700

Payments on long-term debt

           (460,840

Draw on revolving credit

     53,000      

Other financing activities

     (462     (6,647
  

 

 

   

 

 

 

Net cash used in financing activities

     (22,645     (271,229

Effect of exchange rate changes on cash

     7,801     (2,064
  

 

 

   

 

 

 

Net change in cash and cash equivalents

     65,300     (17,702

Cash and cash equivalents at beginning of period

     77,944     95,646
  

 

 

   

 

 

 

Cash and cash equivalents at end of period

   $ 143,244   $ 77,944
  

 

 

   

 

 

 

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

PATTERSON COMPANIES, INC.

SALES SUMMARY

(Dollars in thousands)

(Unaudited)

 

     April 24,
2021
     April 25,
20201
     Total
Sales
Growth
    Foreign
Exchange
Impact
    Other2     Internal
Sales
Growth
 

Three Months Ended

              

Consolidated net sales

              

Consumable

   $ 1,262,772    $ 1,061,273      19.0     1.6     (4.3 )%      21.7

Equipment and software

     206,190      127,738      61.4       1.6           59.8  

Value-added services and other

     92,831      97,450      (4.7     0.6           (5.3
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 1,561,793    $ 1,286,461      21.4     1.5     (3.6 )%      23.5
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Dental

              

Consumable

   $ 357,248    $ 231,551      54.3     1.2         53.1

Equipment and software

     182,938      110,927      64.9       1.9           63.0  

Value-added services and other

     75,846      67,116      13.0       0.5           12.5  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 616,032    $ 409,594      50.4     1.3         49.1
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Animal Health

              

Consumable

   $ 905,524    $ 829,722      9.1     1.7     (5.5 )%      12.9

Equipment and software

     23,252      16,811      38.3                   38.3  

Value-added services and other

     10,541      6,708      57.1       3.4           53.7  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 939,317    $ 853,241      10.1     1.7     (5.4 )%      13.8
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Corporate

              

Value-added services and other

   $ 6,444    $ 23,626      (72.7 )%              (72.7 )% 
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 6,444    $ 23,626      (72.7 )%              (72.7 )% 
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

1 Certain sales were reclassified between categories to conform to the current period presentation.

2 Sales of certain products previously recognized on a gross basis were recognized on a net basis during the three and twelve months ended April 24, 2021.

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

PATTERSON COMPANIES, INC.

SALES SUMMARY

(Dollars in thousands)

(Unaudited)

 

     April 24,
2021
     April 25,
20201
     Total
Sales
Growth
    Foreign
Exchange
Impact
    Other2     Internal
Sales
Growth
 

Twelve Months Ended

              

Consolidated net sales

              

Consumable

   $ 4,748,441    $ 4,374,829      8.5     0.6     (1.3 )%      9.2

Equipment and software

     822,267      749,390      9.7       0.3           9.4  

Value-added services and other

     341,358      365,792      (6.7     0.2           (6.9
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 5,912,066    $ 5,490,011      7.7     0.5     (1.0 )%      8.2
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Dental

              

Consumable

   $ 1,314,261    $ 1,141,189      15.2     0.3         14.9

Equipment and software

     731,132      677,677      7.9       0.3           7.6  

Value-added services and other

     281,628      283,056      (0.5     0.1           (0.6
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 2,327,021    $ 2,101,922      10.7     0.3         10.4
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Animal Health

              

Consumable

   $ 3,434,180    $ 3,233,640      6.2     0.7     (1.7 )%      7.2

Equipment and software

     91,135      71,713      27.1                   27.1  

Value-added services and other

     34,679      30,900      12.2       1.5           10.7  
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 3,559,994    $ 3,336,253      6.7     0.7     (1.7 )%      7.7
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Corporate

              

Value-added services and other

   $ 25,051    $ 51,836      (51.7 )%              (51.7 )% 
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 25,051    $ 51,836      (51.7 )%              (51.7 )% 
  

 

 

    

 

 

    

 

 

   

 

 

   

 

 

   

 

 

 

1 Certain sales were reclassified between categories to conform to the current period presentation.

2 Sales of certain products previously recognized on a gross basis were recognized on a net basis during the three and twelve months ended April 24, 2021.

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

PATTERSON COMPANIES, INC.

OPERATING INCOME (LOSS) BY SEGMENT

(In thousands)

(Unaudited)

 

     Three Months Ended     Twelve Months Ended  
     April 24,
2021
    April 25,
2020
    April 24,
2021
    April 25,
2020
 

Operating income (loss)

        

Dental

   $ 29,227   $ 32,846   $ 201,244   $ 168,304

Animal Health

     32,518     (645,979     88,123     (594,743

Corporate

     (24,397     (1,330     (78,760     (145,680
  

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 37,348   $ (614,463   $ 210,607   $ (572,119
  

 

 

   

 

 

   

 

 

   

 

 

 

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

PATTERSON COMPANIES, INC.

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

(Dollars in thousands, except per share amounts)

(Unaudited)

 

For the three months ended April 24, 2021

   GAAP     Deal
amortization
     Integration
and
business
restructuring
expenses
     Legal
reserve
costs
     Accelerated
debt-related
costs
     Investment
(gain) loss
     Goodwill
impairment
     Non-GAAP  
Operating income (loss)    $ 37,348     $ 9,261    $ 1,090    $      $      $    $    $ 47,699
Other expense, net      (1,652                                               (1,652
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Income (loss) before taxes      35,696       9,261      1,090                                  46,047
Income tax expense (benefit)      7,182       2,196      273                                  9,651
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net income (loss)      28,514       7,065      817                                  36,396
Net loss attributable to noncontrolling interests      (241                                               (241
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net income (loss) attributable to Patterson Companies, Inc.    $ 28,755     $ 7,065    $ 817    $      $      $    $    $ 36,637
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Weighted average shares*      97,393                         97,393
Diluted earnings (loss) per share attributable to Patterson Companies, Inc.**    $ 0.30     $ 0.07    $ 0.01    $

 
   $

 
   $    $    $ 0.38
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Operating income (loss) as a % of sales      2.4                       3.1
Effective tax rate      20.1                       21.0

For the three months ended April 25, 2020

   GAAP     Deal
amortization
     Integration
and
business
restructuring
expenses
     Legal
reserve
costs
     Accelerated
debt-related
costs
     Investment
(gain) loss
     Goodwill
impairment
     Non-GAAP  
Operating income (loss)    $ (614,463   $ 9,252    $ 2,000    $

 
   $

 
   $    $ 675,055    $ 71,844
Other expense, net      (18,461                                 623             (17,838
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Income (loss) before taxes      (632,924     9,252      2,000                    623      675,055      54,006
Income tax expense (benefit)      (24,127     2,201      500                    156      34,428      13,158
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net income (loss)      (608,797     7,051      1,500                    467      640,627      40,848
Net loss attributable to noncontrolling interests      (211                                               (211
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Net income (loss) attributable to Patterson Companies, Inc.    $ (608,586   $ 7,051    $ 1,500    $

 
   $

 
   $ 467    $ 640,627    $ 41,059
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Weighted average shares*      94,462                         95,394
Diluted earnings (loss) per share attributable to Patterson Companies, Inc.**    $ (6.44   $ 0.07    $ 0.02    $

 
   $

 
   $    $ 6.72    $ 0.43
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
Operating income (loss) as a % of sales      (47.8 )%                        5.6

Effective tax rate

     3.8                       24.4

* When we present GAAP or non-GAAP net loss attributable to Patterson Companies, Inc., incremental shares related to dilutive securities are not included in the diluted EPS calculation because they would have an anti-dilutive impact on EPS. When we present GAAP or non-GAAP net income attributable to Patterson Companies, Inc., incremental shares related to dilutive securities are included in the diluted EPS calculation.

** May not sum due to rounding and difference in weighted average shares used to calculate diluted earnings (loss) per share.

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

PATTERSON COMPANIES, INC.

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

(Dollars in thousands, except per share amounts)

(Unaudited)

 

For the twelve months ended April 24, 2021

   GAAP     Deal
amortization
     Integration
and
business
restructuring
expenses
     Legal
reserve
costs
     Accelerated
debt-
related
costs
     Investment
(gain) loss
    Goodwill
impairment
     Non-GAAP  
Operating income (loss)    $ 210,607     $ 37,002    $ 1,090    $    $    $   $    $ 248,699
Other expense, net      (10,676                                              (10,676
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
Income (loss) before taxes      199,931       37,002      1,090                                 238,023
Income tax expense (benefit)      44,822       8,792      273                                 53,887
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
Net income (loss)      155,109       28,210      817                                 184,136
Net loss attributable to noncontrolling interests      (872                                              (872
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
Net income (loss) attributable to Patterson Companies, Inc.    $ 155,981     $ 28,210    $ 817    $    $    $   $    $ 185,008
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
Weighted average shares*      96,664                        96,664
Diluted earnings (loss) per share attributable to Patterson Companies, Inc.**    $ 1.61     $ 0.29    $ 0.01    $    $    $   $    $ 1.91
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
Operating income (loss) as a % of sales      3.6                      4.2
Effective tax rate      22.4                      22.6

For the twelve months ended April 25, 2020

   GAAP     Deal
amortization
     Integration
and
business
restructuring
expenses
     Legal
reserve
costs ‡
     Accelerated
debt-
related
costs
     Investment
(gain) loss
    Goodwill
impairment
     Non-GAAP  
Operating income (loss)    $ (572,119   $ 37,010    $ 15,461    $ 81,254    $    $   $ 675,055    $ 236,661
Other expense, net      (18,288                          9,943      (33,711            (42,056
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
Income (loss) before taxes      (590,407     37,010      15,461      81,254      9,943      (33,711     675,055      194,605
Income tax expense (benefit)      (1,040     8,802      3,870      7,113      2,486      (7,728     34,428      47,931
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
Net income (loss)      (589,367     28,208      11,591      74,141      7,457      (25,983     640,627      146,674
Net loss attributable to noncontrolling interests      (921                                              (921
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
Net income (loss) attributable to Patterson Companies, Inc.    $ (588,446   $ 28,208    $ 11,591    $ 74,141    $ 7,457    $ (25,983   $ 640,627    $ 147,595
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
Weighted average shares*      94,154                        95,059
Diluted earnings (loss) per share attributable to Patterson Companies, Inc.**    $ (6.25   $ 0.30    $ 0.12    $ 0.78    $ 0.08    $ (0.27   $ 6.74    $ 1.55
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
Operating income (loss) as a % of sales      (10.4 )%                       4.3

Effective tax rate

     0.2                      24.6

‡ Includes costs and expenses incurred in the first quarter of fiscal 2020 of $17,666 related to the settlement of litigation with SourceOne Dental, Inc., costs and expenses incurred in the second quarter of fiscal 2020 of $58,300 related to the then-probable settlement of litigation with the U.S. Attorney’s Office for the Western District of Virginia and $5,288 related to other legal proceedings.

* When we present GAAP or non-GAAP net loss attributable to Patterson Companies, Inc., incremental shares related to dilutive securities are not included in the diluted EPS calculation because they would have an anti-dilutive impact on EPS. When we present GAAP or non-GAAP net income attributable to Patterson Companies, Inc., incremental shares related to dilutive securities are included in the diluted EPS calculation.

** May not sum due to rounding and difference in weighted average shares used to calculate diluted earnings (loss) per share.

 

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PATTERSON COMPANIES | 1031 Mendota Heights Road | Saint Paul, MN 55120      NEWS RELEASE

 

PATTERSON COMPANIES, INC.

FREE CASH FLOW

(In thousands)

(Unaudited)

 

     Twelve Months Ended  
     April 24,
2021
    April 25,
2020
 

Net cash used in operating activities

   $ (730,519   $ (243,544

Additions to property and equipment

     (25,788     (41,809

Collection of deferred purchase price receivables

     833,958     540,944

Impact of trade account receivables facility

           (29,000
  

 

 

   

 

 

 

Free cash flow

   $ 77,651   $ 226,591
  

 

 

   

 

 

 

 

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