SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended June 30, 1995
Commission File Number 1-6926
C. R. BARD, INC.
(Exact name of registrant as specified in its charter)
New Jersey
(State of incorporation)
22-1454160
(I.R.S. Employer Identification No.)
730 Central Avenue, Murray Hill, New Jersey 07974
(Address of principal executive offices)
Registrant's telephone number,
including area code: (908) 277-8000
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 Outstanding at July 31, 1995
Common Stock - $.25 par value 52,271,756
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C. R. BARD, INC. AND SUBSIDIARIES
INDEX
Page No.
PART I - FINANCIAL INFORMATION
Condensed Consolidated Balance Sheets -
June 30, 1995 and December 31, 1994 1
Condensed Statements of Consolidated Income
and Retained Earnings For The Quarter and
Six Months Ended June 30, 1995 and 1994 2
Condensed Consolidated Statements of Cash Flows
For The Six Months Ended June 30, 1995 and 1994 3
Notes to Consolidated Financial Statements 4
Management's Discussion and Analysis of Financial
Condition and Results of Operations 5
PART II - OTHER INFORMATION 6
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<TABLE>
C. R. BARD, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(thousands of dollars)
<CAPTION>
June 30, December 31,
1995 1994
(Unaudited)
<S> <C> <C>
ASSETS
Current Assets:
Cash and short-term investments $ 39,400 $ 34,200
Accounts receivable, net 207,000 187,300
Inventories 213,300 199,200
Other current assets 15,200 7,300
Total current assets 474,900 428,000
Long-term investments 11,700 13,300
Property, plant and equipment, net 198,300 199,900
Intangible assets, net of amortization 280,200 265,400
Other assets 52,600 51,800
$1,017,700 $958,400
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND SHAREHOLDERS' INVESTMENT
<S> <C> <C>
Current Liabilities:
Short-term borrowings and current
maturities of long-term debt $ 105,400 $195,900
Accounts payable 37,100 39,200
Accrued expenses 122,800 121,500
Federal and foreign income taxes 7,400 8,000
Total current liabilities 272,700 364,600
Long-term debt 199,200 78,300
Other long-term liabilities 53,400 75,700
Shareholders' Investment
Preferred stock, $1 par value,
authorized 5,000,000 shares;
none issued --- ---
Common stock, $.25 par value,
authorized 300,000,000 shares;
issued and outstanding 52,177,853
shares and 52,047,524 shares 13,000 13,000
Capital in excess of par value 24,000 20,500
Retained earnings 433,900 403,300
Other 21,500 3,000
492,400 439,800
$1,017,700 $958,400
<FN>
</TABLE>
The accompanying notes to consolidated financial statements are an
integral part of these balance sheets.
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<TABLE>
C. R. BARD, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF CONSOLIDATED INCOME AND RETAINED EARNINGS
(thousands except per share amounts)
(Unaudited)
<CAPTION>
For Quarter Ended For Six Months Ended
June 30, June 30,
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Net sales $277,200 $256,300 $541,300 $503,700
Costs and expenses:
Cost of goods sold 135,900 124,500 265,200 245,800
Marketing, selling and
administrative 83,200 74,900 161,000 146,700
Research and development 19,200 18,700 37,600 34,400
238,300 218,100 463,800 428,900
Operating income 38,900 38,200 77,500 74,800
Interest expense 6,000 3,200 11,700 5,800
Other income(expense),
net 1,500 (1,200) 3,200 (2,200)
Income before taxes and
effect of accounting
change 34,400 33,800 69,000 66,800
Provision for income
taxes 10,300 10,500 20,700 20,700
Net income 24,100 23,300 48,300 46,100
Retained earnings,
beginning of period 418,100 377,900 403,300 367,400
Treasury stock retired (400) (2,700) (2,000) (7,700)
Cash dividends (7,900) (7,300) (15,700) (14,600)
Retained earnings, end of
period $433,900 $391,200 $433,900 $391,200
Weighted average shares
outstanding 52,047 51,992
Net income per share $ .46 $ .45 $ .93 $ .89
Cash dividends per share $ .15 $ .14 $ .30 $ .28
<FN>
</TABLE>
The accompanying notes to condensed consolidated financial
statements are an integral part of these statements.
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<TABLE>
C. R. BARD, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(thousands of dollars)
(Unaudited)
<CAPTION>
For The Six Months Ended
June 30,
1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net income $ 48,300 $ 46,100
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 25,500 17,100
Other non-cash items 1,800 1,900
Changes in assets and liabilities:
Current assets (41,700) (22,800)
Current liabilities (1,400) (32,800)
Other long-term liabilities (22,300) (15,300)
10,200 (5,800)
Cash flows from investing activities:
Capital expenditures (10,700) (18,900)
Other long-term investments, net (10,500) 3,000
(21,200) (15,900)
Cash flows from financing activities:
Purchase of common stock (2,000) (7,700)
Dividends paid (15,700) (14,600)
Short-term borrowings and other (87,000) 41,400
Long-term borrowings 120,900 ---
16,200 19,100
Increase(decrease) in cash and
short-term investments 5,200 (2,600)
Cash and short-term investments-
beginning of year 34,200 75,000
Cash and short-term investments-
end of period $ 39,400 $ 72,400
<FN>
</TABLE>
The accompanying notes to condensed consolidated financial
statements are an integral part of these statements.
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C. R. BARD, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The Company believes that it has included all adjustments,
consisting only of normal recurring adjustments, which are
necessary to present fairly the results of operations for these
periods. The results of operations for the interim periods are not
necessarily indicative of results of operations for a full year.
These financial statements should be read in conjunction with the
Consolidated Financial Statements and Notes to Consolidated
Financial Statements, as filed by the Company in the 1994 Annual
Report on Form 10-K.
Acquisitions
On May 24, 1995, the Company announced an agreement for a stock-
for-stock merger of MedChem Products, Inc. into Bard. Under the
terms of the agreement each of MedChem's approximately 11 million
shares outstanding would be valued at $9.25, subject to adjustment
under certain circumstances. The merger is subject to government
approval and approval at a MedChem special meeting of shareholders
later this summer. The transaction is expected to be a tax-free
reorganization and to be accounted for as a pooling of interests.
MedChem manufactures topical hemostatic products which arrest
bleeding during surgery, vascular access catheters and a wound
closure device, all of which complement Bard's existing product
lines.
Short-Term Borrowings and Long-Term Debt
In June 1995, the Company completed the arrangement of a
$350,000,000 five-year syndicated credit facility. This loan
commitment by a group of 15 banks will allow Bard to borrow at
interest rates slightly over LIBOR while securing a well-balanced
debt structure. As a result of this loan facility, the Company has
reclassified $120,000,000 of its short-term borrowings at June 30,
1995 as long-term debt.
Resolution With FDA Of Applications Integrity Policy
On June 30, 1995 the Company announced that the Food and Drug
Administration (FDA) had lifted the Applications Integrity Policy
(AIP) imposed on the Company's USCI division in January 1994. With
this lifting, the FDA began reviewing USCI's pre-market approval
and 510(k) applications. The Company hopes to begin receiving
510(k) approvals on new USCI applications late in 1995, with new
PMA supplement approvals beginning sometime in 1996.
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C. R. BARD, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Consolidated net sales for the second quarter of $277,200,000
increased 8 percent over the second quarter 1994 net sales of
$256,300,000. Sales for the first six months of 1995 of
$541,300,000 increased 7 percent over the $503,700,000 for the same
period last year. Sales in the U.S. for the second quarter of 1995
were $177,600,000, down 1 percent from 1994, while international
sales of $99,600,000 were up 31 percent against last year. The
currency translation effect increased sales outside the U.S. in the
second quarter of 1995 by 12 percent. For the first six months of
1995, U.S. sales totaled $355,200,000, down 1 percent, while
international sales increased 29 percent to $186,100,000. Currency
translation for the first half of 1995 increased worldwide sales by
approximately 2 percent. The Company's international revenues were
aided in part by its 1994 acquisitions which continued to
strengthen and generate positive results.
PRODUCT GROUP SUMMARY OF NET SALES
(in thousands)
Quarter Ended June 30, Six Months Ended June 30,
Percent Percent
1995 1994 Change 1995 1994 Change
Cardiovascular $ 98,100 $ 97,500 1 $189,000 $189,900 -
Urological 79,500 71,600 11 158,300 142,600 11
Surgical 99,600 87,200 14 194,000 171,200 13
Net Sales $277,200 $256,300 8 $541,300 $503,700 7
The gross profit of 51.0 percent for both the second quarter and
six month period in 1995 was slightly lower than in 1994 due to
competitive pricing pressure in the U.S. health care market.
Marketing, selling and administrative expenses in 1995 have
increased faster than sales mainly as a result of the additional
amortization of goodwill resulting from the acquisitions made in
late 1994. Interest expense for the second quarter and six month
period of 1995 have increased due to an increase in borrowings used
for acquisitions.
Other income(expense), net, totaled $3,200,000 in income for the
first half of 1995 and $2,200,000 in expense for the same period
last year. The 1995 other income is mainly a result of favorable
foreign exchange transactions.
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C. R. BARD, INC. AND SUBSIDIARIES
Second quarter consolidated net income of $24,100,000 increased 3
percent from the $23,300,000 second quarter results of last year.
Net income for the six months of 1995 of $48,300,000 reflects an
increase of 5 percent from $46,100,000 for the same period last
year. Net income per share for the second quarter of 1995 of $.46
increased 2 percent over the $.45 earned in the prior year's second
quarter. The second quarter earnings performance was impacted by
approximately 2 cents per share due to a reduction in receipt of
anticipated royalty income from a balloon angioplasty patent
license. This matter is currently awaiting a decision from a U.S.
District Court.
Total borrowings increased from $274,200,000 at December 31, 1994
to $304,600,000 at June 30, 1995. In June 1995, the Company
entered into an arrangement for $350,000,000 five-year syndicated
credit facility. Drawing on this facility, the Company has reduced
its short-term borrowings and increased its long-term debt. The
Company believes it could borrow adequate funds at competitive
terms and rates should the need arise.
Other long-term liabilities decreased by $22,300,000 during the six
month period ended June 30, 1995. This reduction was mainly a
result of the Company reclassifying $15,300,000 from long-term to
short-term for its obligations under the Department of Justice
settlement agreement.
Other shareholders' investment has increased by $18,500,000 in the
first six months of 1995 mainly as a result of translation
adjustments.
During the first six months of 1995 and 1994, the Company acquired
75,000 and 300,000 respectively, of its common shares which were
retired.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(b) Registrant filed a Current Report on Form 8-K dated
May 31, 1995 with respect to announcing a merger
agreement between C. R. Bard, Inc. and MedChem Products,
Inc.
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C. R. BARD, INC. AND SUBSIDIARIES
SIGNATURES
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.
C. R. BARD, INC.
(Registrant)
William C. Bopp /s/
William C. Bopp
Senior Vice President and
Chief Financial Officer
Charles P. Grom /s/
Vice President and Controller
and Chief Accounting Officer
August 8, 1995
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