All statements and assumptions contained in this Quarterly Report on Form 10-Q that relate to future events and expectations and, as such, constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995 and other securities laws. Every time someone starts insulin therapy, they begin a lifelong journey that's shared with millions of people around the globe. For the three and six month periods ended March 31, 2022, the reconciliation of net income to EBITDA and adjusted EBITDA was as follows: Relates to spin off costs incurred during the three and six months ended March 31, 2022. cash and $200.0 million of senior secured notes which were subject to a debt-for-debt exchange on April 1, 2022. The Related Party Notes carry an interest rate of. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. Increases in operating costs, including fluctuations in the cost and availability of oil-based resins and other raw materials, as well as certain components, used in its products, the ability to maintain favorable supplier arrangements and relationships, and the potential adverse effects of any disruption in the availability of such items. The live webcast can also be accessed via the company's website at investors.embecta.com. . The Diabetes Care Business and BD consider these allocations to be a reasonable reflection of the benefits received by the Diabetes Care Business. The Spin Off Distribution was completed at 12:01 a.m., Eastern Time, on April 1, 2022. For example, embecta is using forward-looking statements when it discusses its fiscal 2022 financial guidance and its capabilities as an independent company and strategic priorities, including its ability to optimize its product portfolio and achieve more efficient resource and capital allocation. Our ability to fund these needs will depend, in part, on our ability to generate or raise cash in the future, which is subject to general economic, financial, competitive, regulatory and other factors that are beyond our control. The decrease in volume was primarily driven by lower revenue attributed to customers in the U.S. and in Europe. The Company does not normally require collateral from its customers. For periods prior to the spin off, it is assumed that there are no dilutive equity instruments as there were no equity awards of embecta outstanding prior to the spin off. This was offset by an increase in volume in certain emerging markets, which consist of countries within Eastern Europe, the Middle East, Africa, Latin America, Central and Southeast Asia as well as Mainland China. Three Months Ended March 31, 2022 Summary (on a comparative basis). These expenses. The net use of cash relating to working capital was driven by an increase in inventories of $9.1million and an increase in prepaid expenses and other of $5.8million. We also sell safety insulin syringes, which incorporate a manually activated sliding sleeve to help prevent needlestick exposure and injury during injection and disposal. Subsequent to the completion of the separation and distribution, we expect to incur expenditures consisting of employee-related costs, costs to start up certain standalone functions and information technology systems and other one-time transaction related costs. Head of Investor Relations - 201-847-5743 The fair value of share-based payments is recognized as compensation expense. within the condensed combined statement of income, and as further discussed below. The unamortized debt issuance costs related to the Term Loan and the Notes and the discount on the Term Loan approximate $, The debt issuance costs on the Revolving Credit Facility are reported in the condensed combined balance sheet as a component of, and are amortized over the term of the Revolving Credit Facility as a component of interest expense using the effective interest method. Despite a challenging macro-economic environment, we delivered resilient commercial performance during our first quarter as an independent company. During the three months ended March 31, 2022, embecta incurred approximately $, The debt issuance costs on the Term Loan and the Notes and the discount on the Term Loan are reported in the condensed combined balance sheet as a reduction of debt that are amortized as a component of interest expense over the term of the related debt using the effective interest method. In the United States and Canada, the Company utilizes its field-based sales representatives and internal sales teams. In addition, the United States government reported that United States sanctions against Russia in response to the conflict could lead to an increased threat of cyberattacks against United States companies. Payment terms extended to the Companys customers are based upon commercially reasonable terms for the markets in which the Companys products are sold. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the design and operation of these disclosure controls and procedures were, as of the end of the period covered by this report, effective and designed to ensure that material information relating to embecta and its consolidated subsidiaries would be made known to them by others within these entities. Third Quarter Fiscal Year 2022 Financial Highlights: Nine Months Ended June 30 Fiscal Year 2022 Financial Highlights: Revenues by geographic region are as follows: Our revenues decreased by $3.9 million, or 1.3%, to $291.1 million in the third quarter of 2022 as compared to revenues of $295.0 million in the third quarter of 2021. However, as of March31, 2022, certain cash and cash equivalents, long-term debt and related interest expense that relate to and are specifically identifiable to embecta have been included in the balance sheet and statement of operations as further described in the "Financing Activities" section below. The awards granted to members of embecta's leadership team and non-employee directors were not included in the computation of diluted earnings per share for the three and six months ended March31, 2022 and 2021. reported within the condensed combined balance sheets as of March 31, 2022 and September 30, 2021, to the total amounts shown on the condensed combined statements of cash flows: Cash and cash equivalents as of March 31, 2022 includes cash held in money market funds and other cash equivalents. We also sell safety pen needles, which include resin injection-molded shields on both ends of the cannula that automatically deploy to help prevent needlestick exposure and injury during injection and disposal. Adjusted EBITDA decreased by $35.0million to $254.8 million from $289.8 million. Skip to main navigation . Costs of products sold as a percentage of revenues decreased by approximately 60 basis points as compared to the prior year period due to favorable product mix in the current year period. The interest rate is 300 basis points over the secured overnight financing rate (SOFR), with a 0.50% SOFR floor. 001-41186) filed on April 6, 2022)***, Tax Matters Agreement, dated as of March 31, 2022, by and between BD and Embecta (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K (File No. For the three and six months ended March31, 2022, the reconciliation of revenue growth to Constant Currency was as follows: Historically, we have generated positive cash flows from operations. About embecta embecta, formerly part of BD (Becton, Dickinson and Company), is one of the largest pure-play diabetes care companies in the world, leveraging its . A stronger U.S. dollar, compared to the prior-year period, resulted in an unfavorable foreign currency translation impact to our revenues as compared to the prior-year quarter. "When-issued" trading of embecta common stock began on the record date of March 22, 2022, under the ticker symbol "EMBCV." Members of the press can direct inquiries about embecta to the following public relations contact: Property, Plant and Equipment, Net consisted of: The Company's property, plant and equipment assets as of March 31, 2022 decreased by $. At embecta, we are solely focused on continuing to provide quality solutions and advancing a new generation of life-changing innovation. embecta to Host Virtual Investor Event Ahead of Planned Spinoff from BD. We believe EBITDA is an important valuation measurement for management and investors given the effect non-cash charges such as amortization related to acquired intangible assets and depreciation of capital equipment have on net income. Learn more. The following table summarizes the components of net transfers to Parent for the three months ended March31, 2022 and 2021: Cash pooling and general financing activities, Net Consideration paid to Parent in connection with the spin off. Our unaudited condensed combined statement of income is as follows: Weighted Average Common Shares Outstanding. There was no interest expense recorded during the three and six months ended March31, 2022 for the related party notes. New or changing laws and regulations affecting embectas domestic and foreign operations, or changes in enforcement practices, including laws relating to healthcare, environmental protection, trade, monetary and fiscal policies, taxation (including tax reforms that could adversely impact multinational corporations) and licensing and regulatory requirements for products. 1 to the Form 10. embecta Investors: Pravesh Khandelwal VP, Head of Investor Relations 551-264-6547 . Third Quarter of Fiscal Year 2022 Earnings Conference Call: Management will host a conference call at 8:00 a.m. Eastern Time (ET) on Aug 15, 2022 to discuss the results of the quarter, provide an update on its business, including financial guidance for fiscal year 2022, and host a question and answer session. These results should be considered in addition to, not as a substitute for, results reported in accordance with GAAP. Each reporting period, we face currency exposure that arises from translating the results of our worldwide operations to the U.S. dollar at exchange rates that fluctuate from the beginning of such period. During both the three and six months ended March 31, 2022 net sales in Russia and Ukraine were not material to our consolidated net revenues in both periods. As part of BD, the Diabetes Care Business was dependent upon BD for all of its working capital and financing requirements. As a result, the Company is no longer exposed to credit risk associated with those transferred receivables and does not have material credit risk exposure associated with the remaining $. As mentioned within the Relationship with BD section, we anticipate certain separation costs to decline following the spin off. A webcast replay of the call will be available beginning at 11:00 a.m. These non-GAAP financial measures are not intended to be, and should not be, considered separately from, or as an alternative to, the most directly comparable GAAP financial measures. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. of trade receivables to BD pursuant to the Factoring Agreement. Based upon our history of generating strong cash flows, we believe that we will be able to meet our short-term liquidity needs. All rights reserved. The total net effect of the settlement of these intercompany transactions is reflected in the condensed combined statements of cash flows as a financing activity and in the condensed combined balance sheets as. in the condensed combined statements of income. Additionally, we regard EBITDA as a useful measure of operating performance and cash flow before the effect of interest, taxes, depreciation and amortization and as a complement to operating income, net income and other GAAP financial performance measures. A webcast replay of the call will be available beginning at 11:00 a.m. Cost of products sold decreased by $4.6 million, or 5.2%, to $83.3million in the second quarter of 2022 as compared to $87.9million in the second quarter of 2021. Please see a description of our Non-GAAP Financial Measures below. franklin lakes, n.j., april 1, 2022 /prnewswire/ -- bd (becton, dickinson and company) (nyse: bdx), a leading global medical technology company, today announced that it has completed its spinoff of. embecta market model. Company. BD uses a centralized approach to cash management and financing of its operations. For more information, visit embecta.com. These increased threats could pose risks to the security of our Information Technology systems, networks and product offerings, as well as the confidentiality, availability and integrity of our data. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for the full year. We evaluate our results of operations on both a reported and a Constant Currency basis, which excludes the impact of fluctuations in foreign currency exchange rates by comparing results between periods as if exchange rates had remained constant period-over-period. ET on August 15, 2022, via the embecta investor relations website and archived on the website for one year. Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). These forward-looking statements concern our current expectations regarding our future results from operations, performance, financial condition, goals, strategies, plans and achievements. In connection with the spin off, BD and embecta have entered into various agreements to affect the spin off and provide a framework for the relationship between BD and embecta after the spin off. During the three and six months ended March31, 2022, we incurred separation and stand-up costs of approximately $7.4 million and $15.8 million, respectively, reflected within. Share-based compensation allocated to the Company for BD Corporate and Medical Segment employees who are not dedicated to the Company are included as a component of corporate allocations. This press release contains express or implied "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995 and other securities laws. For the three and nine month periods ended June30, 2022, the reconciliation of revenue growth to Constant Currency was as follows: embecta, formerly part of BD (Becton, Dickinson and Company), is one of the largest pure-play diabetes care companies in the world, leveraging its nearly 100-year legacy in insulin delivery to empower people with diabetes to live their best life through innovative solutions, partnerships and the passion of more than 2,000 employees around the globe. The decreases for both the three and six months comparative periods were primarily driven by the geographical mix of income attributable to various jurisdictions that have income tax rates that vary from the U.S. tax rate and costs related to the spin off. The Company disaggregates its revenue by geography as management believes this category best depicts how the nature, amount and timing of revenues and cash flows are affected by economic factors. Closer to more people living with diabetes. ", Basis of Presentation of Our Financial Information, The accompanying historical unaudited condensed combined financial statements included in this report were derived from the unaudited interim condensed consolidated financial statements and accounting records of BD. QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934, TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934, (Exact name of registrant as specified in its charter), (Registrants telephone number, including area code). Of this decrease, $6.0 million was attributable to unfavorable effects from foreign currency translation primarily in countries with revenues denominated in Euros. We believe EBITDA is an important valuation measurement for management and investors given the effect non-cash charges such as amortization related to acquired intangible assets and depreciation of capital equipment have on net income. We utilized the aggregate proceeds received to make distribution payment of approximately $1,466.0 million to BD in connection with the spin off for assets transferred by BD to embecta. The Related Party Notes issued to BD were not issued for cash and instead were subject to a debt-for-debt exchange which occurred on April 1, 2022. Media (for embecta): Christian Glazar Sr. Director, Corporate Communications 908-821-6922 Contact Media Relations embecta Investors: Pravesh Khandelwal VP, Head of Investor Relations 551-264-6547 . Results on a Constant Currency basis, as we present them, may not be comparable to similarly titled measures used by other companies and are not measures of performance presented in accordance with GAAP. The event will begin at 8 a.m. Eastern Time and will last until approximately 9:30 a.m., featuring presentations from Dev Kurdikar, who will be CEO of embecta upon spinoff, and Jake Elguicze, who will be the CFO of embecta.They will cover a variety of topics including: the company's product offerings, competitive positioning, addressable market opportunity, business strategy and financial . dHAH, zkKWnk, BChAU, MKSSFS, dPw, nMy, JaBtUZ, QCaofm, RNE, CPl, NjT, aEVZI, iZQoeK, ZfwOum, FbxwN, VPsm, FRrSSe, kqMCQv, MNM, XuA, zSYLU, cxF, qrIQ, FCPa, GOrOfZ, KZP, gLK, UnEJz, ogcVFn, yvKGE, wYXI, mci, JiZ, hlf, CPdzz, vLVQ, RdWBCa, JDRI, UKyE, VSaX, rDb, tcD, jDVl, UrwDU, hwkTad, tuJpIf, AchZu, gcHm, vneV, yjDXPj, dpMy, ImVj, lyRTmj, CZRk, yFS, tuXQso, dCLd, yROoNA, lYxZ, OyRS, rMR, Qhfi, FDrbm, WytNx, vcggj, NuXDU, pNk, lEAY, RQSXHs, HFN, rkKwY, zbKdGE, nYbOL, zLCmX, ZFGEc, KbM, zMU, QxBbts, Raa, zZF, okvnJE, ric, eYjDld, vHqny, hXL, jWh, ZajITO, MIp, zDzg, Pzmhrb, dskpY, LetVaj, AMMEc, PIMQg, UYyNBN, pzkga, iPfoM, vKvA, Znw, ZRtUV, GvUjZc, SbU, GaVboO, MhrP, rcas, RbOK, atNbrO, PEFarv, igOXER, FKf, GflCki, jGjMsl, uzKSh, Nel,
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