0001193125-19-055717.txt : 20190228 0001193125-19-055717.hdr.sgml : 20190228 20190228081607 ACCESSION NUMBER: 0001193125-19-055717 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20190228 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20190228 DATE AS OF CHANGE: 20190228 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PATTERSON COMPANIES, INC. CENTRAL INDEX KEY: 0000891024 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-MEDICAL, DENTAL & HOSPITAL EQUIPMENT & SUPPLIES [5047] IRS NUMBER: 410886515 STATE OF INCORPORATION: MN FISCAL YEAR END: 0427 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-20572 FILM NUMBER: 19640536 BUSINESS ADDRESS: STREET 1: 1031 MENDOTA HEIGHTS RD CITY: ST PAUL STATE: MN ZIP: 55120-1401 BUSINESS PHONE: 6516861600 MAIL ADDRESS: STREET 1: 1031 MENDOTA HEIGHTS RD CITY: ST PAUL STATE: MN ZIP: 55120-1401 FORMER COMPANY: FORMER CONFORMED NAME: PATTERSON DENTAL CO DATE OF NAME CHANGE: 19950111 8-K 1 d704009d8k.htm 8-K 8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported) February 28, 2019

 

 

PATTERSON COMPANIES, INC.

(Exact Name of Registrant as Specified in Its Charter)

 

 

 

Minnesota   0-20572   41-0886515

(State or Other Jurisdiction

of Incorporation)

  

(Commission

File Number)

  

(IRS Employer

Identification No.)

1031 Mendota Heights Road

St. Paul, Minnesota 55120

(Address of Principal Executive Offices, including Zip Code)

(651) 686-1600

(Registrant’s Telephone Number, including Area Code)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

☐

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 

Item 2.02

Results of Operations and Financial Condition.

On February 28, 2019, Patterson Companies, Inc. issued a press release announcing its financial results for the third quarter ended January 26, 2019. A copy of the press release is furnished as Exhibit 99 to this Current Report on Form 8-K and is incorporated by reference herein.

 

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits

 

99    Press release of Patterson Companies, Inc., dated February 28, 2019.

 

2

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 hereunto duly authorized.

 

    PATTERSON COMPANIES, INC.
Date: February 28, 2019     By:  

/s/ Les B. Korsh

     

Les B. Korsh

     

Vice President, General Counsel and Secretary

 

3

EX-99 2 d704009dex99.htm EX-99 EX-99

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Exhibit 99

PATTERSON COMPANIES REPORTS FISCAL 2019 THIRD-QUARTER RESULTS

 

  •  

Third-quarter reported net sales totaled $1.4 billion, up 1.6 percent.

 

  •  

Third-quarter GAAP earnings of $0.33 per diluted share.

 

  •  

Third-quarter adjusted earnings1 of $0.38 per diluted share.

 

  •  

Dental segment internal sales increased 0.9%.

 

  •  

Company narrows fiscal 2019 GAAP earnings range to $0.89 to $0.94 per diluted share and adjusted earnings1 range to $1.40 to $1.45 per diluted share.

St. Paul, Minn. — February 28, 2019 — Patterson Companies, Inc. (Nasdaq: PDCO) today reported consolidated net sales of approximately $1.4 billion (see attached Sales Summary for further details) in its fiscal third quarter ended January 26, 2019, an increase of 1.6 percent compared to the same period last year. Internal sales, which are adjusted for the effects of currency translation and changes in product selling relationships, increased 2.5 percent.

Reported net income attributable to Patterson Companies, Inc. for the third quarter of fiscal year 2019 was $31.2 million, or $0.33 per diluted share, compared to $109.0 million, or $1.18 per diluted share, in last year’s fiscal third quarter. The prior year period included the recognition of a provisional tax benefit of $77.3 million, reflecting the revaluation of tax-deferred assets and liabilities, net of a one-time transition tax on unremitted foreign earnings as a result of the Tax Cuts and Jobs Act (“2017 Tax Act”) enacted during the prior year period. Adjusted net income1 attributable to Patterson Companies, Inc., which excludes deal amortization costs, integration and business restructuring costs and discrete tax matters, totaled $35.6 million for the third quarter of fiscal 2019, or $0.38 per diluted share, compared to $39.6 million in the same quarter last year, or $0.43 per diluted share.

“We are pleased with our performance during the third quarter. We delivered the third consecutive quarter of year-over-year revenue growth as well as continued, sequential operating margin improvement,” said Mark Walchirk, President and CEO of Patterson Companies. “We continued to execute against our strategic priorities, which resulted in Dental segment revenue growth and solid performance in our Animal Health segment. Our progress throughout fiscal 2019 provides us with confidence that we are taking the right steps to build a stronger Patterson that is well positioned to deliver long-term value.”

Patterson Animal Health

Reported net sales in our Animal Health segment for the third quarter of fiscal 2019, which comprised approximately 58 percent of the company’s total sales, were $807.5 million compared to $794.9 million in the same quarter last year. Internal sales for the segment increased 2.8 percent from the fiscal 2018 third quarter.

Patterson Dental

Reported net sales in our Dental segment for the third quarter of fiscal 2019, which represented approximately 42 percent of total company sales, were $579.7 million compared to $577.9 million in the same quarter last year. Internal sales increased 0.9 percent compared to the fiscal 2018 third quarter.

Balance Sheet and Capital Allocation

For the first nine months of fiscal 2019, Patterson Companies generated $76.3 million of cash from operating activities and collected deferred purchase price receivables of $308.6 million for a total of $384.9 million, compared to a total of $77.1 million in the same period last year. During the first nine months of fiscal 2019, debt has been reduced by $231.0 million and cash has grown by $54.4 million.

In the third quarter of fiscal 2019, Patterson Companies paid $24.8 million in cash dividends to shareholders. On a year-to-date basis, Patterson has returned $74.7 million in cash dividends to shareholders.

Year-to-Date Results

Consolidated net sales for the first nine months of fiscal 2019 totaled $4.1 billion, a 1.8 percent year-over-year increase. Reported net income attributable to Patterson Companies, Inc. was $55.6 million, or $0.60 per diluted share, compared to $180.0 million, or $1.93 per diluted share in last year’s period. The prior year period included the recognition of a provisional tax benefit of $77.3 million, reflecting the revaluation of tax-deferred assets and liabilities, net of a one-time transition tax on unremitted foreign earnings as a result of the 2017 Tax Act. In July 2018, Patterson Companies booked a pre-tax reserve of $28.3 million for the anticipated settlement of purported class action antitrust litigation.

 

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Adjusted net income1 attributable to Patterson Companies, Inc., which excludes deal amortization costs, integration and business restructuring costs, legal reserve costs and discrete tax matters, totaled $95.9 million, or $1.03 per diluted share, compared to adjusted net income of $128.6 million, or $1.38 per diluted share, in the year-ago period.

FY2019 Guidance

Patterson Companies today narrowed its fiscal 2019 earnings guidance, which is provided on both a GAAP and non-GAAP adjusted1 basis:

 

  •  

GAAP earnings are expected to be in the range of $0.89 to $0.94 per diluted share.

 

  •  

Non-GAAP adjusted earnings1 are expected to be in the range of $1.40 to $1.45 per diluted share.

 

  •  

Our non-GAAP adjusted earnings1 guidance excludes the after-tax impact of:

-    Deal amortization expenses of approximately $29.6 million ($0.32 per diluted share).

-    Legal reserve costs of approximately $20.7 million ($0.22 per diluted share).

-    A benefit related to the 2017 Tax Act of $2.7 million ($0.03 per diluted share).

Our guidance is for current operations as well as completed or previously announced acquisitions and does not include the impact of potential future acquisitions or similar transactions, if any, or impairments and material restructurings beyond those previously publicly disclosed. Our guidance assumes North American and international market conditions similar to those experienced in fiscal 2018.

1Non-GAAP Financial Measures

The Reconciliation of GAAP to non-GAAP Measures table appearing behind the accompanying financial information is provided to adjust reported GAAP measures, namely operating income, income before taxes, income tax expense, net income, net income attributable to Patterson Companies, Inc. and diluted earnings per share attributable to Patterson Companies, Inc., for the impact of deal amortization, integration and business restructuring expenses, legal reserve costs and discrete tax matters, along with the related tax effects of these items.

Management believes that these non-GAAP measures may provide a helpful representation of the company’s third-quarter performance and earnings guidance, and enable comparison of financial results between periods where certain items may vary independent of business performance. These non-GAAP financial measures are presented solely for informational and comparative purposes and should not be regarded as a replacement for corresponding, similarly captioned, GAAP measures.

In addition, the term “internal sales” used in this release represents net sales adjusted to exclude foreign currency impact and changes in product selling relationships. Foreign currency impact represents the difference in results that is attributable to fluctuations in currency exchange rates the company uses to convert results for all foreign entities where the functional currency is not the U.S. dollar. The company calculates the impact as the difference between the current period results translated using the current period currency exchange rates and using the comparable prior period’s currency exchange rates. The company believes the disclosure of net sales changes in constant currency provides useful supplementary information to investors in light of significant fluctuations in currency rates.

Third-Quarter Conference Call and Replay

Patterson Companies’ fiscal 2019 third-quarter earnings conference call will start at 10 a.m. Eastern today. Investors can listen to a live webcast of the conference call at www.pattersoncompanies.com. The conference call will be archived on the Patterson Companies website. A replay of the fiscal 2019 third-quarter conference call can be heard for one week at 800-585-8367 and by providing the Conference ID 1978448 when prompted.

About Patterson Companies Inc.

Patterson Companies Inc. (Nasdaq: PDCO) is a value-added distributor serving the dental and animal health markets.

Dental Market

Patterson’s Dental segment provides a virtually complete range of consumable dental products, equipment and software, turnkey digital solutions and value-added services to dentists and dental laboratories throughout North America.

Animal Health Market

Patterson’s Animal Health segment is a leading distributor of products, services and technologies to both the production and companion animal health markets in North America and the U.K.

 

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This press release contains certain forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are information of a non-historical nature and are subject to risks and uncertainties that are beyond Patterson’s ability to control. Forward-looking statements generally can be identified by words such as “believes,” “expects,” “anticipates,” “foresees,” “forecasts,” “estimates” or other words or phrases of similar import. It is uncertain whether any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what impact they will have on the results of operations and financial condition of Patterson or the price of Patterson stock. These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements. Such risks and uncertainties include, without limitation, operations disruptions attributable to our enterprise resource planning system implementation; our ability to attract or retain qualified sales representatives and service technicians who relate directly with our customers; the reduction, modification, cancellation or delay of purchases of innovative, high-margin equipment; material changes in our purchasing relationships with suppliers; changes in general market and economic conditions; and the other risks and important factors contained and identified in Patterson’s filings with the Securities and Exchange Commission, such as its Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K, any of which could cause actual results to differ materially from the forward-looking statements. Any forward-looking statement in this press release speaks only as of the date on which it is made. Except to the extent required under the federal securities laws, Patterson does not intend to update or revise the forward-looking statements.

 

CONTACT:   John M. Wright, Investor Relations
COMPANY:   Patterson Companies Inc.
EMAIL:   john.wright@pattersoncompanies.com
WEB:   pattersoncompanies.com
SOURCE:   Patterson Companies Inc.

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PATTERSON COMPANIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

(Unaudited)

 

     Three Months Ended     Nine Months Ended  
     January 26,
2019		     January 27,
2018		     January 26,
2019		     January 27,
2018		  

Net sales

    $ 1,396,745     $ 1,375,222     $ 4,137,817     $ 4,065,074  

Gross profit

      299,509       294,736       878,248       909,527  

Operating expenses

      254,146       244,690       787,155       730,889  
  

 

 

    

 

 

    

 

 

    

 

 

  

Operating income

      45,363       50,046       91,093       178,638  

Other income (expense):

         

Other income, net

      1,427       2,096       8,621       4,768  

Interest expense

      (9,172 )      (11,783 )      (29,849 )      (34,454 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Income before taxes

      37,618       40,359       69,865       148,952  

Income tax expense (benefit)

      6,564       (68,596 )      14,674       (31,094 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Net income

      31,054       108,955       55,191       180,046  

Net loss attributable to noncontrolling interests

      (171 )      —         (447 )      —    
  

 

 

    

 

 

    

 

 

    

 

 

  

Net income attributable to Patterson Companies, Inc.

    $ 31,225     $ 108,955     $ 55,638     $ 180,046  
  

 

 

    

 

 

    

 

 

    

 

 

  

Earnings per share attributable to Patterson Companies, Inc.:

         

Basic

    $ 0.34     $ 1.18     $ 0.60     $ 1.94  
  

 

 

    

 

 

    

 

 

    

 

 

  

Diluted

    $ 0.33     $ 1.18     $ 0.60     $ 1.93  
  

 

 

    

 

 

    

 

 

    

 

 

  

Weighted average shares:

         

Basic

      92,818       91,949       92,677       92,674  

Diluted

      93,653       92,609       93,347       93,323  

Dividends declared per common share

    $ 0.26     $ 0.26     $ 0.78     $ 0.78  

 

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PATTERSON COMPANIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

 

     January 26,
2019		      April 28,
2018		  

ASSETS

      

Current assets:

      

Cash and cash equivalents

    $ 117,431      $ 62,984  

Receivables, net

      547,180        826,877  

Inventory

      845,846        779,834  

Prepaid expenses and other current assets

      169,209        103,029  
  

 

 

     

 

 

  

Total current assets

      1,679,666        1,772,724  

Property and equipment, net

      290,271        290,590  

Goodwill and identifiable intangibles, net

      1,174,475        1,205,401  

Long-term receivables, net and other

      176,113        202,949  
  

 

 

     

 

 

  

Total assets

    $ 3,320,525      $ 3,471,664  
  

 

 

     

 

 

  

LIABILITIES AND STOCKHOLDERS’ EQUITY

      

Current liabilities:

      

Accounts payable

    $ 688,125      $ 610,368  

Other accrued liabilities

      193,442        205,415  

Current maturities of long-term debt

      22,131        76,598  

Borrowings on revolving credit

      29,000        16,000  
  

 

 

     

 

 

  

Total current liabilities

      932,698        908,381  

Long-term debt

      732,640        922,030  

Other non-current liabilities

      182,490        179,463  
  

 

 

     

 

 

  

Total liabilities

      1,847,828        2,009,874  

Stockholders’ equity

      1,472,697        1,461,790  
  

 

 

     

 

 

  

Total liabilities and stockholders’ equity

    $ 3,320,525      $ 3,471,664  
  

 

 

     

 

 

  

 

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PATTERSON COMPANIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

     Nine Months Ended  
     January 26,
2019		     January 27,
2018		  

Operating activities:

     

Net income

    $ 55,191     $ 180,046  

Adjustments to reconcile net income to net cash provided by operating activities:

     

Depreciation and amortization

      62,425       62,787  

Non-cash employee compensation

      22,282       22,999  

Deferred consideration in securitized receivables

      (308,592 )      (37,068 ) 

Change in assets and liabilities, net of acquired

      245,038       (188,751 ) 
  

 

 

    

 

 

  

Net cash provided by operating activities

      76,344       40,013  

Investing activities:

     

Additions to property and equipment

      (33,926 )      (28,239 ) 

Collection of deferred purchase price receivables

      308,592       37,068  

Other investing activities

      2,875       10,600  
  

 

 

    

 

 

  

Net cash provided by investing activities

      277,541       19,429  

Financing activities:

     

Dividends paid

      (74,731 )      (74,641 ) 

Repurchases of common stock

      —         (87,500 ) 

Retirement of long-term debt

      (244,010 )      (7,377 ) 

Draw on revolving credit

      13,000       120,000  

Other financing activities

      6,228       7,546  
  

 

 

    

 

 

  

Net cash used in financing activities

      (299,513 )      (41,972 ) 

Effect of exchange rate changes on cash

      75       5,576  
  

 

 

    

 

 

  

Net change in cash and cash equivalents

      54,447       23,046  

Cash and cash equivalents at beginning of period

      62,984       94,959  
  

 

 

    

 

 

  

Cash and cash equivalents at end of period

    $ 117,431     $ 118,005  
  

 

 

    

 

 

  

 

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PATTERSON COMPANIES, INC.

SALES SUMMARY

(Dollars in thousands)

(Unaudited)

 

     January 26,
2019		      January 27,
2018		      Total
Sales
Growth		     Foreign
Exchange
Impact		     Other (a)     Internal
Sales
Growth		  

Three Months Ended

               

Consolidated net sales

               

Consumable

    $ 1,079,566      $ 1,074,189        0.5 %      (1.0 )%      (0.1 )%      1.6 % 

Equipment and software

      234,251        222,574        5.2       (0.5 )      —         5.7  

Other

      82,928        78,459        5.7       (0.6 )      —         6.3  
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Total

    $ 1,396,745      $ 1,375,222        1.6 %      (0.9 )%      —   %      2.5 % 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Dental

               

Consumable

    $ 294,708      $ 302,296        (2.5 )%      (0.6 )%      —   %      (1.9 )% 

Equipment and software

      217,649        207,000        5.1       (0.5 )      —         5.6  

Other

      67,376        68,581        (1.8 )      (0.5 )      —         (1.3 ) 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Total

    $ 579,733      $ 577,877        0.3 %      (0.6 )%      —   %      0.9 % 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Animal Health

               

Consumable

    $ 784,858      $ 771,893        1.7 %      (1.1 )%      (0.1 )%      2.9 % 

Equipment and software

      16,602        15,574        6.6       —         —         6.6  

Other

      6,035        7,400        (18.4 )      (1.8 )      —         (16.6 ) 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Total

    $ 807,495      $ 794,867        1.6 %      (1.1 )%      (0.1 )%      2.8 % 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Corporate

               

Other

    $ 9,517      $ 2,478        284.1 %      —   %      —   %      284.1 % 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Total

    $ 9,517      $ 2,478        284.1 %      —   %      —   %      284.1 % 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

(a) Sales of certain products previously recognized on a gross basis were recognized on a net basis during the three and nine months ended January 26, 2019.

 

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PATTERSON COMPANIES, INC.

SALES SUMMARY

(Dollars in thousands)

(Unaudited)

 

     January 26,
2019		      January 27,
2018		      Total
Sales
Growth		     Foreign
Exchange
Impact		     Other (a)     Internal
Sales
Growth		  

Nine Months Ended

               

Consolidated net sales

               

Consumable

    $ 3,327,214      $ 3,270,385        1.7 %      (0.2 )%      (0.2 )%      2.1 % 

Equipment and software

      563,269        540,860        4.1       (0.2 )      —         4.3  

Other

      247,334        253,829        (2.6 )      (0.1 )      —         (2.5 ) 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Total

    $ 4,137,817      $ 4,065,074        1.8 %      (0.2 )%      (0.1 )%      2.1 % 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Dental

               

Consumable

    $ 902,753      $ 933,691        (3.3 )%      (0.1 )%      —   %      (3.2 )% 

Equipment and software

      520,292        504,376        3.2       (0.2 )      —         3.4  

Other

      205,268        212,247        (3.3 )      (0.1 )      —         (3.2 ) 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Total

    $ 1,628,313      $ 1,650,314        (1.3 )%      (0.2 )%      —   %      (1.1 )% 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Animal Health

               

Consumable

    $ 2,424,461      $ 2,336,694        3.8 %      (0.3 )%      (0.2 )%      4.3 % 

Equipment and software

      42,977        36,484        17.8       —         —         17.8  

Other

      20,679        21,408        (3.4 )      (0.2 )      —         (3.2 ) 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Total

    $ 2,488,117      $ 2,394,586        3.9 %      (0.3 )%      (0.2 )%      4.4 % 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Corporate

               

Other

    $ 21,387      $ 20,174        6.0 %      —   %      —   %      6.0 % 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

Total

    $ 21,387      $ 20,174        6.0 %      —   %      —   %      6.0 % 
  

 

 

     

 

 

     

 

 

    

 

 

    

 

 

    

 

 

  

(a) Sales of certain products previously recognized on a gross basis were recognized on a net basis during the three and nine months ended January 26, 2019.

 

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PATTERSON COMPANIES, INC.

OPERATING INCOME BY SEGMENT

(In thousands)

(Unaudited)

 

     Three Months Ended     Nine Months Ended  
     January 26,
2019		     January 27,
2018		     January 26,
2019		     January 27,
2018		  

Operating income (loss)

         

Dental

    $ 51,120     $ 58,439     $ 128,587     $ 183,165  

Animal Health

      15,033       18,037       56,096       57,930  

Corporate

      (20,790 )      (26,430 )      (93,590 )      (62,457 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

    $ 45,363     $ 50,046     $ 91,093     $ 178,638  
  

 

 

    

 

 

    

 

 

    

 

 

  

 

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PATTERSON COMPANIES, INC.

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

(Dollars in thousands, except per share amounts)

(Unaudited)

 

For the three months ended January 26, 2019

    GAAP     Deal amortization      Integration
and business
restructuring
expenses		     Legal
reserve		      Discrete tax matters     Non-GAAP  

Operating income

    $ 45,363     $ 9,274      $ —       $ —        $ —       $ 54,637  

Other expense, net

      (7,745 )      —          —         —          —         (7,745 ) 
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Income before taxes

      37,618       9,274        —         —          —         46,892  

Income tax expense (benefit)

      6,564       2,219        —         —          2,686       11,469  
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Net income

      31,054       7,055        —         —          (2,686 )      35,423  

Net loss attributable to noncontrolling interests

      (171 )      —          —         —          —         (171 ) 
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Net income attributable to Patterson Companies, Inc.

    $ 31,225     $ 7,055      $ —       $ —        $ (2,686 )    $ 35,594  
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Diluted earnings per share attributable to Patterson Companies, Inc.*

    $ 0.33     $ 0.08      $ —       $ —        $ (0.03 )    $ 0.38  
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Operating income as a % of sales

      3.2 %                3.9 % 

Effective tax rate

      17.4 %                24.5 % 

For the three months ended January 27, 2018

    GAAP     Deal amortization      Integration
and business
restructuring
expenses		     Legal
reserve		      Discrete tax matters     Non-GAAP  

Operating income

    $ 50,046     $ 9,692      $ —       $ —        $ —       $ 59,738  

Other expense, net

      (9,687 )      —          —         —          —         (9,687 ) 
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Income before taxes

      40,359       9,692        —         —          —         50,051  

Income tax expense (benefit)

      (68,596 )      2,209        (370 )      —          77,256       10,499  
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Net income

      108,955       7,483        370       —          (77,256 )      39,552  

Net loss attributable to noncontrolling interests

      —         —          —         —          —         —    
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Net income attributable to Patterson Companies, Inc.

    $ 108,955     $ 7,483      $ 370     $ —        $ (77,256 )    $ 39,552  
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Diluted earnings per share attributable to Patterson Companies, Inc.*

    $ 1.18     $ 0.08      $ —       $ —        $ (0.83 )    $ 0.43  
  

 

 

    

 

 

     

 

 

    

 

 

     

 

 

    

 

 

  

Operating income as a % of sales

      3.6 %                4.3 % 

Effective tax rate

      (170.0 )%                21.0 % 

 

*

May not sum due to rounding

 

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PATTERSON COMPANIES, INC.

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

(Dollars in thousands, except per share amounts)

(Unaudited)

 

For the nine months ended January 26, 2019

    GAAP     Deal
amortization		      Integration
and business
restructuring
expenses		      Legal
reserve		      Discrete tax matters     Non-GAAP  

Operating income

    $ 91,093     $ 28,955      $ —        $ 28,263      $ —       $ 148,311  

Other expense, net

      (21,228 )      —          —          —          —         (21,228 ) 
  

 

 

    

 

 

     

 

 

     

 

 

     

 

 

    

 

 

  

Income before taxes

      69,865       28,955        —          28,263        —         127,083  

Income tax expense (benefit)

      14,674       6,794        —          7,523        2,686       31,677  
  

 

 

    

 

 

     

 

 

     

 

 

     

 

 

    

 

 

  

Net income

      55,191       22,161        —          20,740        (2,686 )      95,406  

Net loss attributable to noncontrolling interests

      (447 )      —          —          —          —         (447 ) 
  

 

 

    

 

 

     

 

 

     

 

 

     

 

 

    

 

 

  

Net income attributable to Patterson Companies, Inc.

    $ 55,638     $ 22,161      $ —        $ 20,740      $ (2,686 )    $ 95,853  
  

 

 

    

 

 

     

 

 

     

 

 

     

 

 

    

 

 

  

Diluted earnings per share attributable to Patterson Companies, Inc.*

    $ 0.60     $ 0.24      $ —        $ 0.22      $ (0.03 )    $ 1.03  
  

 

 

    

 

 

     

 

 

     

 

 

     

 

 

    

 

 

  

Operating income as a % of sales

      2.2 %                 3.6 % 

Effective tax rate

      21.0 %                 24.9 % 

For the nine months ended January 27, 2018

    GAAP     Deal
amortization		      Integration
and business
restructuring
expenses		      Legal
reserve		      Discrete tax matters     Non-GAAP  

Operating income

    $ 178,638     $ 28,982      $ 8,594      $ —        $ —       $ 216,214  

Other expense, net

      (29,686 )      —          —          —          —         (29,686 ) 
  

 

 

    

 

 

     

 

 

     

 

 

     

 

 

    

 

 

  

Income before taxes

      148,952       28,982        8,594        —          —         186,528  

Income tax expense (benefit)

      (31,094 )      8,900        2,879        —          77,256       57,941  
  

 

 

    

 

 

     

 

 

     

 

 

     

 

 

    

 

 

  

Net income

      180,046       20,082        5,715        —          (77,256 )      128,587  

Net loss attributable to noncontrolling interests

      —         —          —          —          —         —    
  

 

 

    

 

 

     

 

 

     

 

 

     

 

 

    

 

 

  

Net income attributable to Patterson Companies, Inc.

    $ 180,046     $ 20,082      $ 5,715      $ —        $ (77,256 )    $ 128,587  
  

 

 

    

 

 

     

 

 

     

 

 

     

 

 

    

 

 

  

Diluted earnings per share attributable to Patterson Companies, Inc.*

    $ 1.93     $ 0.22      $ 0.06      $ —        $ (0.83 )    $ 1.38  
  

 

 

    

 

 

     

 

 

     

 

 

     

 

 

    

 

 

  

Operating income as a % of sales

      4.4 %                 5.3 % 

Effective tax rate

      (20.9 )%                 31.1 % 

 

*

May not sum due to rounding

 

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