Becton, Dickinson and Company

Please stand by, we're about to begin. Hello and welcome to BD's second fiscal quarter 2024 earnings call. At the request of BD, today's call is being recorded and will be available for replay on BD's Investor Relations website, investors.bd.com, or by phone at 1-800-723-5792 for domestic calls and area code 1- 402-220-2664 for international calls. For today's call, all parties have been placed in a listen-only mode until the question-and-answer session. I will now turn the call over to Greg Roditas, Senior Vice President, Treasurer, and Head of Investor Relations.

Good morning, and welcome to BD's earnings call. I'm Gregory Adidas, Senior Vice President, Treasurer, and Head of Investor Relations. Thank you for joining us. This call is being made available via audio webcast at BD.com. Earlier this morning, BD released its results for the second quarter of fiscal 2024. The press release and presentation can be accessed on the IR website at investors.bd.com. Leading today's calls are Tom Poland, BD's Chairman, Chief Executive Officer, and President, and Chris DeLaurifus, Executive Vice President and Chief Financial Officer. Following this morning's prepared remarks, Tom and Chris will be joined for Q&A by our segment presidents, Mike Garrison, President of the Medical Segment, Dave Hickey, President of the Life Sciences Segment, and Rick Bird, President of the Interventional Segment. Before we get started, I want to remind you that we'll be making forward-looking statements. You can read the disclaimer in our earnings release and the disclosures in our SEC filings available on the Investor Relations website. Unless otherwise specified, all comparisons will be made on a year-over-year basis versus a relevant fiscal period. Revenue percentage changes are on an FX-neutral basis unless otherwise noted. Reconciliations between GAAP and non-GAAP measures are included in the appendices of the earnings release and presentation. With that, I am very pleased to turn it over to Tom.

Thanks, Greg. Good morning, everyone, and thank you for joining us. Second quarter revenue growth accelerated significantly, as expected, driven by the strength of our portfolio, increasing volumes across our consumables, and Alaris. Margin performance drove adjusted EPS ahead of our expectations, and consistent with our plan, we delivered very strong cash flow and are on track to deliver another year of double-digit free cash flow growth. These results give us the confidence to once again increase our FY24 adjusted EPS guidance. Turning to our BD2025 strategy, We continue to execute well on the actions we outlined at our investor day to drive profitable growth and value creation. This includes advancing our innovation pipeline, which supports our durable 5.5% plus targeted growth profile. One such area is the strong cadence of new innovation across our connected medication management suite, which delivers many unique benefits to our customers. Q2 was the second full quarter since clearance of our new Alera system, and first half Alaris sales have already eclipsed our total FY23 performance. Our return to market is ramping faster than initially planned, which wouldn't be possible without our manufacturing team, who have executed extremely well in scaling Alaris production. Q2 set an all-time record in both the number of BD Alaris pumps manufactured and the number of pumps shipped in a quarter to upgrade our customers to the cleared version of the pump, We have also seen acceleration of committed contracts, inclusive of competitive conversions, as health systems value the capability of Alaris and look to standardize their fleet. This offers confidence in the plan's second half contribution to growth and will support momentum heading into FY25. The Alaris 510 clearance is just the beginning. As we have shared, we are excited about our innovation roadmap, and we are planning upcoming Alaris 510 case submissions to further strengthen our capabilities, like best-in-class interoperability with over 800 live sites, introduce a steady flow of new customer innovations, and ensure continuous compliance. Examples such as over-the-air technology for efficient software updates and continued advanced cybersecurity are planned in the next submission later this calendar year. Beyond Alaris, we have a market-leading connected medication management portfolio across inventory management, compounding, pharmacy automation, medication dispensing, and infusion, and are excited about future innovations and development. This includes new medication dispensing and informatics innovation, including the next generation of our Pixis dispensing platform. which innovates on our hardware design and will advance our cloud connectivity. We continue to scale our BD HealthSites informatics platform, now live in over 1,000 sites, and have upcoming launches to integrate hospital medication data from Pixis with non-acute medication data from our MedBank and MedKeeper platforms to bring visibility to medication flows across the customer's care network. In Q2, we made meaningful progress achieving other key R&D milestones, including several in our peripheral vascular disease platform, which is one of our key growth areas. Longer term, these technologies are each expected to deliver over $50 million in incremental fifth-year revenue and will broaden our leadership in the $5 billion PVD category that is growing high single digits. In our Venus portfolio, We have now enrolled over 60 patients in our Arch Pivotal IDE for our BD Liberty Tips stent graft. This novel, self-expanding covered stent improves the standard of care for portal hypertension, building on our success in launching venous products that help deliver better clinical outcomes for patients and strengthening our presence in the venous market. In our arterial portfolio, we enrolled the first patient in our Agility Pivotal IDE study for our low-profile arterial stent graft, a differentiated technology that minimizes access site complications with precise stent placement that could provide an important new treatment option for over 18 million patients with peripheral arterial disease in the U.S. alone. We also filed our Scion SFA pivotal IDE submission with the FDA for our new Sirolimus DCB for the treatment of PAD. We see this new alternative drug platform as a key growth catalyst for both SFA and below the knee applications. We are also executing well on our simplification strategy to drive margin expansion. We are seeing growing momentum as we scale our BD Excellence operating system and build world-class lean management systems and cultures throughout BD. This drove strong Q2 performance in areas such as waste reduction and production efficiency, contributing to our margin goals. Our focus on cash flow also continues to deliver positive results, generating about $1.1 billion in free cash flow in the first half. This strong start to FY24 positions us to deliver double digit growth in free cash flow for the full year. It also enables continued execution of our disciplined capital allocation strategy, including accretive M&A opportunities in higher growth categories, and opportunistically returning cash to shareholders. Lastly, our teams around the world continue to make advancements on our corporate sustainability strategy. We were recently named among Fortune Magazine's most innovative companies list, a testament to our 70,000 associates who work every day to deliver innovation that meaningfully advances the standard of care around the world. We continue to forge partnerships that expand access to these critical innovations, and most recently, we announced the first-ever option in Singapore for women to self-collect a sample for cervical cancer screening in the privacy of their own home. In summary, we are delivering accelerated revenue growth, are executing ahead of our plan on Alaris, and driving strong margin performance with a growing contribution from BD Excellence. We once again raised our adjusted diluted EPS guidance for fiscal 2024 and believe we are well positioned to achieve our BD 2025 goals. I'll now turn it over to Chris to review our financials and outlook.