Becton, Dickinson and Company

Hello and welcome to the BD second fiscal quarter 2019 earnings call. At the request of BD, today's call is being recorded. It will be available for replay through May 16, 2019 on the investors page of the BD.com website or by phone at 800-585-9000. for domestic calls and area code 4045373406 for international calls using confirmation number 1284128. I would like to inform all parties that your lines have been placed in a listen-only mode until the question and answer segment. Beginning today's call is Ms. Monique Dolecky, Senior Vice President of Investor Relations. Ms. Dolecky, you may begin.

Thank you, Darla. Good morning, everyone, and thank you for joining us to review our second fiscal quarter results. As we referenced in our press release, we are presenting a set of slides to accompany our remarks on this call. The presentation is posted on the investor relations page of our website at bd.com. During today's call, we will make forward-looking statements, and it is possible that actual results could differ from our expectations. Factors that could cause such differences appear in our second fiscal quarter press release, and in the MD&A sections of our recent SEC filings. We will also discuss some non-GAAP financial measures with respect to our performance. Reconciliations to GAAP measures can be found in our press release and its related financial schedules and in the slides. A copy of the release, including the financial schedules, is posted on the BD.com website. Our second quarter results include a non-cash charge in the period related to product liability matters of $331 million pertaining to certain legacy barred surgical products. In addition, in April, we notified customers of a recall expansion of the Larus pump to include all pumps with a certain molded component that was manufactured between April 2011 and June 2017. We have recorded a cumulative charge of $65 million related to the recall to reflect the estimated costs of the remediation efforts that will occur over the next three years. We are working closely with our customers and the FDA, and our remediation actions are guided by our proactive commitment to patient safety and minimizing the disruption of patient care. These items, along with the details of purchase accounting and other adjustments, can be found in the Reconciliations to Gap Measures in the financial schedules in our press release or the appendix of the investor relations slides. As a reminder, to provide additional revenue visibility, we will speak to our fiscal 2019 second quarter revenue results and fiscal 2019 revenue guidance on a comparable currency neutral basis. The comparable basis includes BD and BARD in the current and prior year periods and excludes intercompany revenues, revenues associated with divestitures, and an adjustment to the prior year related to customer rebates and incentives, as detailed in the financial schedules in our press release. Leading the call this morning is Vince Forlenza, Chairman and Chief Executive Officer. Also joining us are Chris Reedy, Executive Vice President, Chief Financial Officer and Chief Administrative Officer, Tom Poland, President and Chief Operating Officer, Alberto Mas, Executive Vice President and President of the Medical Segment, Simon Campion, Executive Vice President and President of the Interventional Segment, and Patrick Kaltenbach, Executive Vice President and President of the Life Sciences Segment. It is now my pleasure to turn the call over to Vince.

Thank you, Monique, and good morning, everyone. At BD, our strategy is driven by our purpose, advancing the world of health. We are confident that our strategy is working, our core remains strong, and we continue to invest in innovation to deliver even more impactful, comprehensive solutions for our customers. Turning to slide five and our second quarter highlights. Our performance in the second quarter was broadly in line with our previously communicated expectations. Strong performance in our core combined with our continued focus on driving operational efficiencies and barred cost synergies drove revenue growth of 3.4% and earnings per share value, earnings per share in line with our guidance range for the second quarter. Our results through the first half are right where we expected them to be. As we've been discussing with you, we plan for revenue growth in the second quarter to be below our full year guidance range. This was driven by our expectation for strong underlining core business growth, partially offset by a tough flu comparison, and timing within the year in pharmaceutical systems. There were two additional items that impacted our growth this quarter. The market reaction to the FDA letter regarding DCVs and timing in the medication delivery solutions business in the U.S., When we factor in these items, underlying revenue growth was in line with our expectations year-to-date. In addition, we remain pleased with the integration of BARD. We are on track for our cost and revenue synergy capture targets, and we have gained momentum on the investments that we made last year. In addition, notable progress has been made on IT systems integration and in planning for supply chain initiatives. We are reaffirming our full fiscal year 2019 currency neutral revenue guidance despite near-term pressure to our DCB business. Our updated EPS guidance reflects strong underlying performance partially offset by the headwind to our DCB business as well as additional foreign currency pressure due to broad strengthening of the U.S. dollar. Looking forward to the remainder of fiscal year 2019. We have confidence in our planned back half acceleration. There are a number of growth drivers across our segments, which we will review later in the presentation, in addition to easing comparisons. I'll now turn things over to Chris for a more detailed discussion of our second quarter fiscal performance and our fiscal year 2019 guidance.