Becton, Dickinson and Company

Please stand by. We're about to begin. Good day, everyone. Welcome to today's conference call to discuss BD's first quarter fiscal 2025 earnings and BD's announcement of its intent to separate BD's biosciences and diagnostic solutions business from the rest of BD. At the request of BD, today's call is being recorded and will be available for replay on BD's investor relations website. investors.beattie.com or by phone at 1-800-839-2486 for domestic calls and area code 402-220-7223 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 Mr. Greg Roditas, Senior Vice President, Treasurer, and Head of Investor Relations. Please go ahead, sir.

Good morning and welcome to Beattie's Earnings Call. I'm Greg Rodriguez, 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. We have a lot of exciting news to discuss today. Yesterday afternoon, we issued two press releases. The first discusses our first quarter results of fiscal 2025. The second announces our intention to separate BD's biosciences and diagnostic solutions business. The press releases and accompanying presentations can be accessed on the IR website at investors.bd.com. For the purposes of today's call, we have posted a combined presentation and we'll be providing slide reference cues to assist you in following along with our prepared remarks. In connection with the separation announcement, the company has decided to postpone its investor day, previously scheduled for February 26, 2025, to allow BD to focus on the transaction. The company expects to provide a comprehensive update on strategy and outlook in the future closer to the separation. Leading today's call 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, Mike Feld, President of the Life Sciences Segment, and Rick Berg, President of the Interventional Assignment. Before we get started, I want to remind you that we will 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 the 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 presentations. With that, let's turn to slide five, and I am very pleased to turn it over to Tom.

Thanks, Greg, and good morning, everyone. We have a number of significant updates to share on how we are creating value through our BD2025 strategy. This includes yesterday's announcement of the planned separation of our biosciences and diagnostic solutions business, our strong Q1 results, updated fiscal 2025 guidance, and progress on our innovation pipeline. So let's jump right in. Starting with our Q1 results, we continue to demonstrate strong execution, exceeding each of our financial goals. This includes 9.6% revenue growth or 3.9% organic. We delivered 370 and 340 basis points of adjusted gross and operating margin expansion, respectively. and 28% growth in adjusted diluted EPS to $3.43. This will provide more color on our Q1 results, but I'd like to take a moment to thank our team whose execution and momentum of BD Excellence is powering continued strong margin expansion, earnings, and cash flow performance. We returned over $1 billion to shareholders in Q1. This includes $300 million in dividends, and a $750 million accelerated share buyback, which we see as a value creating action based on our view of BD's intrinsic value. With strong operational performance in Q1 and confidence in the year, we affirmed our full year currency neutral and organic revenue growth guidance. Our Q1 outperformance enables us to de-risk growth expectations for the second half and also raise the midpoint of our reported EPS guidance, despite incremental translational currency impacts. Moving to slide six. Innovation is core to our growth strategy, and we continue to make strong progress against our pipeline. I'd like to share an update on some key milestones. In BD Medical, we continue to progress our connected care strategy, and as planned, submitted the next 510K for our BD Alaris infusion system. that enables over-the-air software updates and includes a new ETCO2 module. BD Alaris is the only infusion system with an integrated ETCO2 module, enhancing patient safety by monitoring the respiratory system and pausing the pump when necessary to reduce the risk of opioid overdose. The pace and impact of innovation also continues to be strong in advanced patient monitoring. where we received 510K clearance on the NextGen Hemisphere Alta Monitor and the new Swann IQ and Foresight IQ smart sensors. In BDI, we continue to advance our strategy in advanced tissue regeneration and expand into new applications. Most recently, we received EU approval for the prevention of incisional hernias using the Phasix Resorbable Mesh. This makes Phasix the first Resorbable Mesh with a broad indication for preventing incisional hernias. Our U.S. trial remains underway. We also enrolled the first patients in our GALIFLEX capsular contraction prevention clinical trial. This product is BD's first in a series of new innovations using our resorbable biomaterial to improve outcomes in patients undergoing breast surgery. Finally, in life sciences, we continue to advance our strong cycle of innovation and remain on track to launch the first BD Facts Discover Analyzer, the A8, in the second half of this fiscal year. Additionally, in our molecular diagnostics portfolio, we're continuing to advance our position in the $2 billion high volume molecular testing market. Our BD on Clarity HPV assay is the only test with extended genotyping to be FDA approved for self-collection. And we're seeing accelerating sales funnel momentum as a result of recent changes in U.S. cervical cancer screening guidelines and increased U.S. reimbursement. Before I turn it over to Chris to provide further color on our financials and outlook, I want to again express my appreciation of our team's strong work in advancing our BD2025 strategy, a strong quarter, and for what's ahead.