<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended December 31, 1998
-------------------------------------------------
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________________________ to _____________.
Commission file number 001-4802
----------
Becton, Dickinson and Company
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
New Jersey 22-0760120
- ------------------------ ---------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1 Becton Drive Franklin Lakes, New Jersey 07417-1880
---------------------------------------------------------
(Address of principal executive offices)
(Zip Code)
(201) 847-6800
--------------------------------------------
(Registrant's telephone number, including area code)
N/A
--------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X. No .
--- ---
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Class of Common Stock Shares Outstanding as of January 31, 1999
--------------------- -----------------------------------------
Common stock, par value $1.00 249,001,824
<PAGE>
PART I - FINANCIAL INFORMATION
------------------------------
Item 1. Financial Statements.
---------------------
Condensed Consolidated Balance Sheets at December 31, 1998 and
September 30, 1998
Condensed Consolidated Statements of Income for the three months ended
December 31, 1998 and 1997
Condensed Consolidated Statements of Cash Flows for the three months
ended December 31, 1998 and 1997
Notes to Condensed Consolidated Financial Statements
2
<PAGE>
ITEM 1. FINANCIAL STATEMENTS
BECTON, DICKINSON AND COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
Thousands of Dollars
<TABLE>
<CAPTION>
December 31, September 30,
Assets 1998 1998
- ------ ------------ -------------
(Unaudited)
<S> <C> <C>
Current Assets:
Cash and equivalents $ 128,578 $ 83,251
Short-term investments 1,635 7,390
Trade receivables, net 677,663 726,558
Inventories (Note 2):
Materials 132,191 122,232
Work in process 90,392 86,239
Finished products 369,638 328,320
------------ -------------
592,221 536,791
Prepaid expenses, deferred taxes and other 189,820 188,772
------------ ------------
Total Current Assets 1,589,917 1,542,762
Property, plant and equipment 2,781,625 2,727,023
Less allowances for depreciation and amortization 1,463,699 1,424,373
------------ ------------
1,317,926 1,302,650
Goodwill, Net 437,935 412,070
Other Intangibles, Net 335,987 334,275
Other 253,466 254,281
------------ ------------
Total Assets $ 3,935,231 $ 3,846,038
============ ============
Liabilities and Shareholders' Equity
- ------------------------------------
Current Liabilities:
Short-term debt $ 464,955 $ 385,162
Payables and accrued expenses 656,617 706,751
------------ ------------
Total Current Liabilities 1,121,572 1,091,913
Long-Term Debt 761,547 765,176
Long-Term Employee Benefit Obligations 337,450 326,620
Deferred Income Taxes and Other 47,940 48,509
Commitments and Contingencies - -
Shareholders' Equity:
Preferred stock 48,638 48,959
Common stock 332,662 332,662
Capital in excess of par value 8,989 -
Retained earnings 2,405,212 2,350,781
Unearned ESOP compensation (24,640) (24,463)
Deferred compensation 4,970 4,903
Shares in treasury - at cost (1,012,278) (1,015,806)
Accumulated other comprehensive income (96,831) (83,216)
------------ ------------
Total Shareholders' Equity 1,666,722 1,613,820
------------ ------------
Total Liabilities and Shareholders' Equity $ 3,935,231 $ 3,846,038
============ ============
</TABLE>
See notes to condensed consolidated financial statements
3
<PAGE>
BECTON, DICKINSON AND COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Thousands of Dollars, Except Per-share Data
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
December 31,
----------------------------------------------
1998 1997
----------------- -----------------
<S> <C> <C>
Revenues $ 768,966 $ 701,640
Cost of products sold 385,710 354,803
Selling and administrative 223,116 199,140
Research and development 49,310 44,630
----------------- -----------------
Total Operating Costs and Expenses 658,136 598,573
----------------- -----------------
Operating Income 110,830 103,067
Interest expense, net (17,871) (10,241)
Other income (expense), net 1,025 (2,233)
----------------- -----------------
Income Before Income Taxes 93,984 90,593
Income tax provision 17,826 26,272
----------------- -----------------
Net Income $ 76,158 $ 64,321
================= =================
Earnings Per Share:
- ------------------
Basic $ .30 $ .26
================= =================
Diluted $ .29 $ .25
================= =================
Dividends Per Common Share $ .085 $ .0725
================= =================
</TABLE>
See notes to condensed consolidated financial statements
4
<PAGE>
BECTON, DICKINSON AND COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Thousands of Dollars
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
December 31,
--------------------------------------
1998 1997
---------- -----------
<S> <C> <C>
Operating Activities:
- ---------------------
Net income $ 76,158 $ 64,321
Adjustments to Net Income to Derive Net Cash
Provided by Operating Activities:
Depreciation and amortization 62,688 52,977
Change in working capital (67,321) 34,043
Other, net 15,340 12,638
------------ ------------
Net Cash Provided by Operating Activities 86,865 163,979
------------ ------------
Investing Activities:
- ---------------------
Capital expenditures (61,778) (43,998)
Acquisitions of businesses, net of cash acquired (41,706) (39,525)
Change in investments, net 2,895 7,133
Other, net (15,195) (12,610)
------------ ------------
Net Cash Used for Investing Activities (115,784) (89,000)
------------ ------------
Financing Activities:
- ---------------------
Change in short-term debt 75,199 (30,207)
Proceeds of long-term debt 185 -
Payments of long-term debt (4,903) (407)
Issuance of common stock 5,701 5,987
Repurchase of common stock - (42,745)
Dividends paid - (687)
------------ ------------
Net Cash Provided by(Used for) Financing Activities 76,182 (68,059)
------------ ------------
Effect of exchange rate changes on cash and equivalents (1,936) (1,082)
------------ ------------
Net increase in cash and equivalents 45,327 5,838
Opening Cash and Equivalents 83,251 112,639
------------ ------------
Closing Cash and Equivalents $ 128,578 $ 118,477
============ ============
</TABLE>
See notes to condensed consolidated financial statements
5
<PAGE>
BECTON, DICKINSON AND COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Amounts in Thousands, Except Per-share Data
December 31, 1998
Note 1 - Basis of Presentation
- ------------------------------
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with the instructions to Form 10-Q and, in the opinion of
the management of the Company, include all adjustments which are of a normal
recurring nature, necessary for a fair presentation of financial position and
the results of operations and cash flows for the periods presented. However,
the financial statements do not include all information and footnotes required
for a presentation in accordance with generally accepted accounting principles.
These condensed consolidated financial statements should be read in conjunction
with the consolidated financial statements and the notes thereto included or
incorporated by reference in the Company's 1998 Annual Report on Form 10-K. The
results of operations for the interim periods are not necessarily indicative of
the results of operations to be expected for the full year.
Note 2 - Inventory Valuation
- ----------------------------
An actual valuation of inventory under the LIFO method can be made only at the
end of each fiscal year based on the inventory levels and costs at that time.
Accordingly, interim LIFO calculations are based on management's estimates of
expected year-end inventory levels and costs.
Note 3 Comprehensive Income
- ----------------------------
In the quarter ended December 31, 1998, the Company adopted the provisions of
Statement of Financial Accounting Standards ("SFAS") No. 130, "Reporting
Comprehensive Income", which specifies the reporting requirements for
comprehensive income and its components. Comprehensive income for the Company
consists of net income and other comprehensive income, which includes foreign
currency translation adjustments and the net change in unrealized gains and
losses on investments classified as available-for-sale. Total comprehensive
income for the three months ended December 31, 1998 and 1997 was $62,543 and
$48,241, respectively.
In accordance with this Statement, accumulated other comprehensive income has
been reported as a separate component of shareholders' equity in the current
quarter. Prior year information has been reclassified to conform to current
year presentation. The adoption of SFAS No. 130 had no effect on the Company's
reported results of operations, financial condition or cash flows.
6
<PAGE>
Note 4 - Earnings per Share
- ---------------------------
The following table sets forth the computations of basic and diluted earnings
per share, restated to reflect the 1998 two-for-one stock split:
<TABLE>
<CAPTION>
Three Months Ended
December 31,
-----------------------------
1998 1997
------------ ------------
<S> <C> <C>
Net income $ 76,158 $ 64,321
Preferred stock dividends (790) (825)
-------- --------
Income available to
common shareholders (A) 75,368 63,496
Preferred stock dividends - using
"if converted" method 790 825
Additional ESOP contribution -
using "if converted" method (202) (252)
-------- --------
Income available to common
shareholders after assumed conversions (B) $ 75,956 $ 64,069
======== ========
Average common shares outstanding (C) 248,320 243,624
Dilutive stock equivalents from stock plans 11,823 7,466
Shares issuable upon conversion of
preferred stock 5,276 5,484
-------- --------
Average common and common equivalent
shares outstanding - assuming dilution (D) 265,419 256,574
======== ========
Basic earnings per share (A/C) $ .30 $ .26
======== ========
Diluted earnings per share (B/D) $ .29 $ .25
======== ========
</TABLE>
Note 5 - Contingencies
- ----------------------
The Company is involved, both as a plaintiff and a defendant, in various legal
proceedings which arise in the ordinary course of business, including product
liability and environmental matters. In the opinion of the Company, the results
of these matters, individually and in the aggregate, are not expected to have a
material impact on its results of operations, financial condition or cash flows.
The Company has developed a Company-wide Year 2000 plan (the "Plan") to, among
other things, prepare its computer equipment and software and devices with date-
sensitive embedded technology for the year 2000. The estimated costs of the
Company's Plan and the dates by which
7
<PAGE>
the Company believes it will have completed each phase of the Plan, are based
upon management's best estimates, which rely upon numerous assumptions regarding
future events, including the continued availability of certain resources, third-
party remediation plans, and other factors. These estimates, however, may prove
not to be accurate, and actual results could differ materially from those
anticipated. Factors that could result in material differences include, without
limitation, the availability and cost of personnel with appropriate training and
experience, the ability to identify, assess, remediate and test all relevant
computer codes and embedded technology, and similar uncertainties. In addition,
Year 2000-related issues may lead to possible third-party claims, the impact of
which cannot yet be estimated. No assurance can be given that the aggregate cost
of defending and resolving such claims, if any, would not have a material
adverse effect on the Company.
8
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
-----------------------------------------------------------------------
of Operations
-------------
Results of Operations
- ---------------------
First quarter revenues of $769 million exceeded prior year revenues by 10%.
Revenue growth for the quarter was unfavorably affected by the strengthened
dollar versus the prior year, which reduced revenues by an estimated $4 million.
Medical Supplies and Devices segment ("Medical") revenues of $425 million
increased 14%, and Diagnostic Systems segment ("Diagnostic") revenues of $344
million increased 4%.
Domestic Medical revenues of $193 million decreased 4%. This growth rate was
unfavorably affected by a decrease in revenues for the diabetes health care
business compared to the first quarter last year, when unusually high revenue
growth in advance of a January 1998 price increase was reported. International
Medical revenues of $233 million increased 35%, reflecting good growth in the
infusion therapy and prefillable syringe businesses. The growth in the infusion
therapy business was largely due to sales resulting from the acquisition of the
Medical Devices Division of The BOC Group in the third quarter of last year.
Excluding the estimated unfavorable impact of foreign currency translation,
Medical revenue growth outside the United States would have been approximately
37%.
Domestic Diagnostic revenues of $187 million decreased 1%. International
Diagnostic revenues of $157 million increased 11%, or 12% excluding the
estimated unfavorable impact of foreign currency translation. Good revenue
growth was achieved in the flow cytometry, sample collection, and tissue culture
businesses, both in the United States and on a worldwide basis. The infectious
disease diagnostic business continues to be adversely affected by cost
containment in testing in the United States.
The gross profit margin increased to 49.8% compared with last year's first
quarter rate of 49.4%, reflecting continuing productivity improvements. Selling
and administrative expense of $223 million was 29% of revenues. This ratio is
higher than last year's first quarter ratio of 28.4% primarily due to expenses
related to recent acquisitions and reengineering charges associated with the
enterprise-wide business systems upgrade program. Investment of $49 million in
research and development increased 10% over last year's first quarter
expenditures, primarily reflecting the continuation of strategic investments in
support of the Company's key businesses.
Operating income of $111 million increased 8% from last year's first quarter
amount of $103 million. Operating margin was 14.4% compared to last year's
first quarter operating margin of 14.7%.
Net interest expense of $18 million was $8 million higher than last year
primarily due to additional borrowings to fund recent acquisitions. Other
income, net was $1 million compared with other expense, net of $2 million last
year. This change was principally due to amounts recognized in connection with
the termination of a third-party supply agreement, and certain
9
<PAGE>
other contractual matters.
The first quarter income tax rate was 19%, which included a favorable $7 million
tax judgment in Brazil, compared with 29% a year ago. The Company expects its
full year reported tax rate to be about 25%, reflecting the aforementioned tax
judgment as well as a more favorable forecasted mix in income among tax
jurisdictions.
Net income was $76 million compared with $64 million a year ago, an increase of
18%. Diluted earnings per share of $.29 increased 16% compared with last year's
$.25. The impact of unfavorable foreign currency translation reduced diluted
earnings per share by an estimated one cent.
Financial Condition
- -------------------
During the first quarter of 1999, cash provided by operations was $87 million
compared to $164 million during the first quarter of last year. This decrease
reflects inventory replenishment following a strong fiscal 1998 fourth quarter.
Capital expenditures during the quarter were $62 million compared with $44
million during the first quarter of last year. For the full year, the Company
expects capital expenditures to be about $225 million.
During the first quarter of 1999, the Company completed the acquisitions of two
businesses for an aggregate purchase price of $42 million, net of cash acquired,
subject to certain post-closing adjustments.
As of December 31, 1998, total debt of $1.2 billion represented 42.2% of total
capital (shareholders' equity, net non-current deferred income tax liabilities,
and debt), an increase from 35.3% a year ago due to additional borrowings to
fund acquisitions. Because of its strong credit rating, the Company believes it
has the capacity to arrange significant additional borrowings should the need
arise.
At its November 1998 meeting, the Board of Directors increased the Company's
quarterly dividend from $.0725 to $.085 per common share.
On January 1, 1999, the eleven member countries of the European Union began the
transition to the euro as a common currency. The Company had completed the
necessary system modifications to accommodate euro-denominated transactions with
suppliers and customers by this transition date and is continuing to convert
historical information from the respective national currencies to the euro. The
Company currently is evaluating the impact of the euro conversion on market risk
and price competition. The Company does not expect this conversion to have a
material impact on its results of operations, financial condition or cash flows.
Recently, Brazil's currency has depreciated significantly against the dollar.
All of the Company's Brazilian Real foreign exchange transaction exposures were
hedged prior to the devaluation of the currency through foreign exchange forward
contracts and foreign currency options.
10
<PAGE>
Year 2000 Readiness Disclosure
- ------------------------------
As described more fully in its 1998 annual report on Form 10-K, the Company has
developed and is well into implementing a Company-wide Year 2000 plan (the
"Plan") with the intent to ensure that its computer equipment and software and
devices with date-sensitive embedded technology will be able to distinguish
between the year 1900 and the year 2000 and will function properly with respect
to all dates, whether in the twentieth or twenty-first centuries (such
functionality is hereafter referred to as being "Year 2000 compliant"). The
table set forth below summarizes, by focus area, the status and projected dates
of completion as of February 1, 1999 for each of the related tasks:
<TABLE>
<CAPTION>
Estimated % of Completion/Projected Date of Completion
- ---------------------------------------------------------------------------------------------------
3rd Party
Focus Area IT Systems Non-IT Systems Considerations Products
===================================================================================================
<S> <C> <C> <C> <C>
Identification and 100%/ 100%/ 100%/ 100%/
Assessment of Completed Completed Completed Completed
Year 2000 Issues
- ---------------------------------------------------------------------------------------------------
Prioritization of 100%/ 100%/ 100%/ 100%/
Identified Issues Completed Completed Completed Completed
- ---------------------------------------------------------------------------------------------------
Assessment of 100%/ 100%/ 30%/ 100%/
Compliance Completed Completed September 1999 Completed
- ---------------------------------------------------------------------------------------------------
Remediation 70%/ 40%/ 5% / 75%/
September 1999 June 1999 September 1999 June 1999
- ---------------------------------------------------------------------------------------------------
Testing 45%/ 20%/ - / 75%/
September 1999 June 1999 September 1999 July 1999
- ---------------------------------------------------------------------------------------------------
Contingency and - / - / - / 50%/
Business September 1999 June 1999 September 1999 May 1999
Continuation Plans
- ---------------------------------------------------------------------------------------------------
</TABLE>
The total cost of the Company's Year 2000 Plan is not expected to be material to
the Company's financial condition. The estimated total cost of the Plan is
approximately $15 million, and is being funded through operating cash flows. As
of December 31, 1998, the Company had incurred to date approximately $4.5
million in costs related to its Year 2000 identification, assessment,
remediation, and testing efforts. Of the total remaining anticipated costs of
the Plan, approximately $1 million is attributable to the purchase of new
software and hardware and approximately $4 million is attributable to
contingency and business continuation plans. The remaining $5.5 million relates
to the repair, reprogramming or modification of hardware and software, of which
approximately $3 million represents the redeployment of existing resources.
None of the Company's other information technology projects have been delayed or
deferred as a result of the implementation of the Plan.
11
<PAGE>
The Company presently believes it has an effective plan in place to anticipate
and resolve any potential Year 2000 issues in a timely manner. In the event,
however, that the Company does not properly identify Year 2000 issues or the
compliance assessment, remediation and testing is not conducted on a timely
basis with respect to the Year 2000 issues that are identified, there can be no
assurance that Year 2000 issues will not materially and adversely affect the
Company's results of operations or relationships with third parties. In
addition, disruptions in the economy generally resulting from Year 2000 issues
also could materially and adversely affect the Company. The amount of potential
liability and lost revenue that would be reasonably likely to result from the
failure by the Company and certain key third parties to achieve Year 2000
compliance on a timely basis cannot be reasonably estimated at this time. A
contingency plan has not yet been developed for dealing with the most reasonably
likely worst case scenario, and such scenario has not yet been clearly
identified. The Company expects to complete its analysis and contingency
planning by September 30, 1999.
The estimated costs of the Company's Plan, and the dates by which the Company
believes it will have completed each of the phases of the Plan, are based upon
management's best estimates, which rely upon numerous assumptions regarding
future events, including the continued availability of certain resources, third-
party remediation plans, and other factors. These estimates, however, may prove
not to be accurate, and actual results could differ materially from those
anticipated. Factors that could result in material differences include, without
limitation, the availability and cost of personnel with the appropriate training
and experience, the ability to identify, assess, remediate and test all relevant
computer codes and embedded technology, and similar uncertainties. In addition,
Year 2000-related issues may lead to possible third-party claims, the impact of
which cannot yet be estimated. No assurance can be given that the aggregate
cost of defending and resolving such claims, if any, would not have a material
adverse effect on the Company.
Adoption of New Accounting Standards
- ------------------------------------
In June 1997, the Financial Accounting Standards Board ("FASB") issued SFAS No.
131, "Disclosures about Segments of an Enterprise and Related Information".
This Statement establishes a new method by which companies will report operating
segment information. This method is based on the manner in which management
organizes the segments within a company for making operating decisions and
assessing performance. As required by the Statement, the Company will adopt the
provision of SFAS No. 131 in its fiscal year-end 1999 financial statements and
may report different operating segments.
In February 1998, the FASB issued SFAS No. 132, "Employers' Disclosures about
Pension and Other Postretirement Benefits". This Statement standardizes the
disclosure requirements, requires additional information on changes in benefit
obligations and fair values of plan assets, and eliminates certain disclosures.
As required by the Statement, the Company will adopt the new disclosure rules in
its fiscal year-end 1999 financial statements.
In April 1998, the American Institute of Certified Public Accountants issued
Statement of Position (SOP) 98-5 "Reporting on the Costs of Start-Up
Activities". The Company is required to adopt the provisions of this Statement
no later than its fiscal year 2000. This SOP provides
12
<PAGE>
guidance on the financial reporting of start-up and organization costs and
requires such costs, as defined, to be expensed as incurred. Adoption of this
Statement is not expected to have a material impact on the Company's results of
operations or financial condition.
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities". The Company is required to adopt the
provisions of this Statement no later than its fiscal year 2000. This Statement
requires that all derivatives be recorded in the balance sheet as either an
asset or liability measured at fair value. The Statement requires that changes
in the derivative's fair value be recognized currently in earnings unless
specific hedge accounting criteria are met. The Company is in the process of
evaluating this Statement and has not yet determined the future impact on the
Company's consolidated financial statements.
Forward-Looking Statements
- --------------------------
This interim report on Form 10-Q may contain certain forward looking statements
(as defined under Federal securities laws) regarding the Company's performance,
including future revenues, products and income, which are based upon current
expectations of the Company and involve a number of business risks and
uncertainties. Actual results could vary materially from anticipated results
described in any forward-looking statement. Factors that could cause actual
results to vary materially include, but are not limited to, competitive factors,
changes in regional, national or foreign economic conditions, changes in
interest or foreign currency exchange rates, delays in product introductions,
year 2000 issues, and changes in health care or other governmental regulation,
as well as other factors discussed herein and in other of the Company's filings
with the Securities and Exchange Commission.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
-----------------------------------------------------------
There have been no material changes in information reported since the
fiscal year ended September 30, 1998.
13
<PAGE>
PART II - OTHER INFORMATION
---------------------------
Item 1. Legal Proceedings.
-----------------
The Company is involved, both as a plaintiff and a defendant, in
various legal proceedings which arise in the ordinary course of
business, including product liability and environmental matters.
As described more fully in the Company's 1998 annual report on Form
10-K, the Company, along with a number of other manufacturers, has been
named as a defendant in approximately 214 product liability lawsuits
related to natural rubber latex that have been filed in various state
and Federal courts. Cases pending in Federal court are being coordinated
under the matter In re Latex Gloves Products Liability Litigation (MDL
Docket No. 1148) in Philadelphia, and analogous procedures have been
implemented in the state courts of California, Pennsylvania and New
Jersey. The Company is vigorously defending these lawsuits.
The Company has been named as a defendant in ten product liability
lawsuits relating to health care workers who allegedly sustained
accidental needle sticks, but have not become infected with any disease.
Another manufacturer and several medical product distributors also have
been named as defendants in most of these cases. The cases have been
filed on behalf of an unspecified number of health care workers in ten
different states, seeking class action certification under the laws of
these states. To date no class has been certified in any of these
cases. The actions filed during the first quarter of fiscal 1999 are
pending in state court in Florida, under the caption Delgado vs. Becton
Dickinson et al. (Case No. 98-5608, Hillsborough County Circuit Court),
filed on October 27, 1998; in state court in Oklahoma, under the
caption Palmer vs. Becton Dickinson et al. (Case No. CJ-98-685, Sequoyah
County District Court), filed on October 27, 1998; in state court in
Alabama, under the caption Daniels vs. Becton Dickinson et al. (Case No.
CV 1998 2757 Montgomery County Circuit Court), filed on October 30,
1998; in state court in South Carolina, under the caption Bales vs.
Becton Dickinson et al. (Case No. 98-CP-40-4343, Richland County Court
of Common Pleas), filed on November 25, 1998; in state court in
Pennsylvania, under the caption Snodgrass vs. Becton Dickinson et al.
(Case No. 03474, Philadelphia County Court of Common Pleas), filed on
November 27, 1998; and in state court in New Jersey, under the caption
Swartley vs. Becton Dickinson et al. (Case No. L-009449-98, Camden
County Superior Court), filed on December 7, 1998.
Generally, these actions allege that health care workers have sustained
needle sticks using hollow-bore needle devices manufactured by the
Company and, as a result, require medical testing, counseling and/or
treatment.
14
<PAGE>
In the opinion of the Company, the results of the above matters,
individually and in the aggregate, are not expected to have a material
effect on its results of operations, financial condition or cash flows.
Item 2. Changes in Securities and Use of Proceeds.
------------------------------------------
Not applicable.
Item 3. Defaults Upon Senior Securities.
--------------------------------
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
----------------------------------------------------
Not applicable.
Item 5. Other Information.
------------------
Not applicable.
Item 6. Exhibits and Reports on Form 8-K.
---------------------------------
a) Exhibits
27 - Financial Data Schedule.
b) Reports on Form 8-K
During the three-month period ended December 31, 1998, the Company
filed one Current Report on Form 8-K under Item 5 - Other Events
concerning the announcement of its results for the fiscal year ended
September 30, 1998. This report was dated November 6, 1998.
15
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Becton, Dickinson and Company
-----------------------------
(Registrant)
Date February 9, 1999
----------------
/s/ Kenneth R. Weisshaar
--------------------------------------
Kenneth R. Weisshaar
Senior Vice President - Finance and Chief Financial Officer
(Principal Financial and Accounting Officer)
16
<PAGE>
EXHIBIT INDEX
-------------
Exhibit
Number Description Method of Filing
- --------------------------------------------------------------------------------
27 Financial Data Schedule Filed with
this report
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S CONSOLIDATED FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-END> DEC-31-1998
<CASH> 128,578
<SECURITIES> 1,635
<RECEIVABLES> 677,663
<ALLOWANCES> 0 <F1>
<INVENTORY> 592,221
<CURRENT-ASSETS> 1,589,917
<PP&E> 2,781,625
<DEPRECIATION> 1,463,699
<TOTAL-ASSETS> 3,935,231
<CURRENT-LIABILITIES> 1,121,572
<BONDS> 761,547
<COMMON> 332,662
0
48,638
<OTHER-SE> 1,285,422
<TOTAL-LIABILITY-AND-EQUITY> 3,935,231
<SALES> 768,966
<TOTAL-REVENUES> 768,966
<CGS> 385,710
<TOTAL-COSTS> 385,710
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0 <F1>
<INTEREST-EXPENSE> 18,776
<INCOME-PRETAX> 93,984
<INCOME-TAX> 17,826
<INCOME-CONTINUING> 76,158
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 76,158
<EPS-PRIMARY> 0.30
<EPS-DILUTED> 0.29
<FN>
<F1> THESE ITEMS ARE CONSOLIDATED ONLY AT YEAR-END
</FN>
</TABLE>
