FY23 net sales of $3,965 million increased 1.1%, organic sales increased 2.2%
FY23 GAAP net income (loss) of ($132) million or ($0.62) per share, adjusted EPS of $1.83
Q4 net sales of $1,012 million increased 2.9%, organic sales increased 1.9%
Q4 GAAP net income of $67 million or $0.32 per share, adjusted EPS of $0.44
FY24 outlook: organic sales flat to up 1.5%; adjusted EPS of $2.00 to $2.10
CHARLOTTE, N.C., Feb. 29, 2024 (GLOBE NEWSWIRE) — DENTSPLY SIRONA Inc. (“Dentsply Sirona” or the “Company”) (NASDAQ:XRAY) today announced its financial results for the fourth quarter and full year of 2023.
Full year 2023 net sales of $3,965 million increased 1.1% (organic sales increased 2.2%), compared to the full year of 2022. Net income (loss) was ($132) million, or ($0.62) per share, compared to net income (loss) of ($950) million, or ($4.41) per share for the full year of 2022. Non-cash charges for the impairment of goodwill and other intangible assets was ($302) million, net of tax, or ($1.42) per share in 2023, and ($1.1) billion, net of tax, or ($5.10) per share in 2022. Adjusted earnings per diluted share were $1.83, compared to $2.09 in 2022. A reconciliation of Non-GAAP measures (including organic sales, adjusted EBITDA and margin, adjusted EPS, and adjusted free cash flow conversion) to GAAP measures is provided below.
Fourth quarter net sales of $1,012 million increased 2.9% (organic sales increased 1.9%) compared to the fourth quarter of 2022. Net income was $67 million, or $0.32 per diluted share, compared to net income (loss) of ($15) million, or ($0.07) per share in the fourth quarter of 2022. Adjusted earnings per diluted share were $0.44 compared to $0.46 in the fourth quarter of 2022.
“We delivered on our outlook with three of our four segments posting year-over-year growth in the fourth quarter and full year 2023,” said Simon Campion, President and Chief Executive Officer. “Dentsply Sirona’s transformation is taking shape, and while there is more work ahead, we expect that 2024 will be an inflection point for improved profitability and adjusted earnings per share growth. We maintain our conviction that we are on the right path to deliver meaningful value over the long term.”
Q4 23 and FY 23 Summary Results (GAAP)
(in millions, except per share amount and percentages)
Q4 23
Q4 22
YoY
FY 23
FY 22
YoY
Net Sales
$1,012
$983
2.9%
$3,965
$3,922
1.1%
Gross Profit
$522
$517
1.0%
$2,086
$2,127
(1.9%)
Gross Margin
51.6%
52.6%
52.6%
54.2%
Net Income (Loss) Attributable to Dentsply Sirona
$67
($15)
NM
($132)
($950)
NM
Diluted Earnings (Loss) Per Share
$0.32
($0.07)
NM
($0.62)
($4.41)
NM
NM – not meaningful
Percentages are based on actual values and may not recalculate due to rounding.
Q4 23 and FY 23 Summary Results (Non-GAAP)[1]
(in millions, except per share amount and percentages)
Q4 23
Q4 22
YoY
FY 23
FY 22
YoY
Net Sales
$1,012
$983
2.9%
$3,965
$3,922
1.1%
Organic Sales Growth %
1.9%
2.2%
Adjusted EBITDA
$173
$171
0.7%
$691
$766
(9.8%)
Adjusted EBITDA Margin
17.1%
17.5%
17.4%
19.5%
Adjusted EPS
$0.44
$0.46
(4.0%)
$1.83
$2.09
(12.8%)
[1] Organic sales growth, adjusted EBITDA, and adjusted EPS are Non-GAAP financial measures which exclude certain items. Please refer to “Non-GAAP Financial Measures” below for a description of these measures and to the tables at the end of this release for a reconciliation between GAAP and Non-GAAP measures.
Percentages are based on actual values and may not recalculate due to rounding.
Q4 23 and FY 23 Segment Results
Net Sales Growth %
Organic Sales Growth %
Q4 23
FY 23
Q4 23
FY 23
Connected Technology Solutions
(7.0%)
(4.1%)
(8.3%)
(2.8%)
Essential Dental Solutions
4.5%
2.8%
3.4%
3.6%
Orthodontic and Implant Solutions
10.3%
3.4%
10.6%
5.1%
Wellspect Healthcare
21.1%
6.6%
16.9%
7.3%
Total
2.9%
1.1%
1.9%
2.2%
Q4 23 and FY 23 Geographic Results
Net Sales Growth %
Organic Sales Growth %
Q4 23
FY 23
Q4 23
FY 23
United States
(0.4%)
3.2%
(1.2%)
3.0%
Europe
5.3%
(0.6%)
2.7%
(0.2%)
Rest of World
4.3%
0.7%
5.4%
5.1%
Total
2.9%
1.1%
1.9%
2.2%
Cash Flow and Liquidity
Operating cash flow in the fourth quarter of 2023 was $160 million, compared to $142 million in the prior year, primarily as a result of improved working capital due primarily to effective inventory management and the timing of accounts payable. Full year 2023 operating cash flow was $377 million, as compared to $517 million in the prior year, primarily driven by unfavorable working capital and higher cost of sales and operating expenses. In the fourth quarter, the Company paid $30 million in dividends and executed share repurchases of $150 million, resulting in a total of $416 million returned to shareholders in 2023. The Company had $334 million of cash and cash equivalents as of December 31, 2023.
Quarterly Cash Dividend
The Company’s Board of Directors approved a 14% increase in the Company’s quarterly dividend rate, from the previous rate of $0.14 per share of common stock to $0.16 per share. The dividend is payable on April 12, 2024, to holders of record as of March 29, 2024. This represents the fourth consecutive annual double-digit increase, demonstrating the Company’s commitment to return cash to shareholders.
Full Year 2024 Outlook
The 2024 outlook includes anticipated net sales in the range of $3.96 billion to $4.02 billion, flat to up 1.5% on an organic basis. Adjusted EPS is expected to be in the range of $2.00 to $2.10.
Other 2024 outlook assumptions are included in the fourth quarter 2023 earnings presentation posted on the Investors section of the Dentsply Sirona website at https://investor.dentsplysirona.com. The Company does not provide forward-looking estimates on a GAAP basis as certain information is not available without unreasonable effort and cannot be reasonably estimated.
Conference Call/Webcast Information
Dentsply Sirona’s management team will host an investor conference call and live webcast on February 29, 2024, at 8:30 am ET. A live webcast of the investor conference call and a presentation related to the call will be available on the Investors section of the Company’s website at https://investor.dentsplysirona.com.
For those planning to participate on the call, please register at https://register.vevent.com/register/BI780eb31a2a894c20ae60990011145ed8. A webcast replay of the conference call will be available on the Investors section of the Company’s website following the call.
About Dentsply Sirona
Dentsply Sirona is the world’s largest manufacturer of professional dental products and technologies, with over a century of innovation and service to the dental industry and patients worldwide. Dentsply Sirona develops, manufactures, and markets a comprehensive solutions offering including dental and oral health products as well as other consumable medical devices under a strong portfolio of world class brands. Dentsply Sirona’s products provide innovative, high-quality and effective solutions to advance patient care and deliver better and safer dental care. Dentsply Sirona’s headquarters is located in Charlotte, North Carolina. The Company’s shares are listed in the United States on Nasdaq under the symbol XRAY. Visit www.dentsplysirona.com for more information about Dentsply Sirona and its products.
Contact Information:
Investors:
Andrea Daley
Vice President, Investor Relations
+1-704-591-8631
InvestorRelations@dentsplysirona.com
Press:
Marion Par-Weixlberger
Vice President, Public Relations & Corporate Communications
+43 676 848414588
marion.par-weixlberger@dentsplysirona.com
Forward-Looking Statements and Associated Risks
This Press Release contains statements that do not directly and exclusively relate to historical facts which constitute forward-looking statements, including, statements and projections concerning, among other things, the expected timing, benefits and costs associated with the Company’s restructuring plan described in this Press Release. The Company’s forward-looking statements represent current expectations and beliefs and involve risks and uncertainties. Actual results may differ significantly from those projected or suggested in any forward-looking statements and no assurance can be given that the results described in such forward-looking statements will be achieved. Investors are cautioned not to place undue reliance on such forward-looking statements which speak only as of the date they are made. The forward-looking statements are subject to numerous assumptions, risks and uncertainties and other factors that could cause actual results to differ materially from those described in such statements, many of which are outside of our control. The Company does not undertake any obligation to release publicly any revisions to such forward-looking statements to reflect events or circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Any number of factors could cause the Company’s actual results to differ materially from those contemplated by any forward-looking statements, including, but not limited to, the risks associated with the following: the Company’s ability to remain profitable in a very competitive marketplace, which depends upon the Company’s ability to differentiate its products and services from those of competitors; the Company’s failure to realize assumptions and projections which may result in the need to record additional impairment charges; the effect of changes to the Company’s distribution channels for its products and the failure of significant distributors of the Company to effectively manage their inventories; the Company’s ability to control costs and failure to realize expected benefits of cost reduction and restructuring efforts and the Company’s failure to anticipate and appropriately adapt to changes or trends within the rapidly changing dental industry. Investors should carefully consider these and other relevant factors, including those risk factors in Part I, Item 1A, (“Risk Factors”) in the Company’s most recent Form 10-K, including any amendments thereto, and any updating information which may be contained in the Company’s other filings with the SEC, when reviewing any forward-looking statement. The Company notes these factors for investors as permitted under the Private Securities Litigation Reform Act of 1995. Investors should understand it is impossible to predict or identify all such factors or risks. As such, you should not consider either the foregoing lists, or the risks identified in the Company’s SEC filings, to be a complete discussion of all potential risks or uncertainties.
DENTSPLY SIRONA INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share amounts and percentages)
(unaudited)
Three Months Ended
Year Ended
December 31,
December 31,
2023
2022
2023
2022
Net sales
$
1,012
$
983
$
3,965
$
3,922
Cost of products sold
490
466
1,879
1,795
Gross profit
522
517
2,086
2,127
Selling, general, and administrative expenses
409
402
1,613
1,589
Research and development expenses
43
43
184
174
Goodwill and intangible asset impairments
—
6
307
1,287
Restructuring and other costs
(3
)
1
67
14
Operating income (loss)
73
65
(85
)
(937
)
Other income and expenses:
Interest expense, net
20
20
81
65
Other (income) expense, net
(4
)
37
9
53
Income (loss) before income taxes
57
8
(175
)
(1,055
)
(Benefit) provision for income taxes
(15
)
23
(43
)
(105
)
Net income (loss)
72
(15
)
(132
)
(950
)
Less: Net loss attributable to noncontrolling interests
5
—
—
—
Net income (loss) attributable to Dentsply Sirona
$
67
$
(15
)
$
(132
)
$
(950
)
Net income (loss) per common share attributable to Dentsply Sirona:
Basic
$
0.32
$
(0.07
)
$
(0.62
)
$
(4.41
)
Diluted
$
0.32
$
(0.07
)
$
(0.62
)
$
(4.41
)
Weighted average common shares outstanding:
Basic
210.0
215.1
212.0
215.5
Diluted
210.9
215.1
212.0
215.5
DENTSPLY SIRONA INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions)
(unaudited)
December 31, 2023
December 31, 2022
Assets
Current Assets:
Cash and cash equivalents
$
334
$
365
Accounts and notes receivable-trade, net
695
632
Inventories, net
624
627
Prepaid expenses and other current assets
320
269
Total Current Assets
1,973
1,893
Property, plant and equipment, net
800
761
Operating lease right-of-use assets, net
178
200
Identifiable intangible assets, net
1,705
1,903
Goodwill, net
2,438
2,688
Other noncurrent assets
276
198
Total Assets
$
7,370
$
7,643
Liabilities and Equity
Current Liabilities:
Accounts payable
$
305
$
279
Accrued liabilities
749
727
Income taxes payable
49
46
Notes payable and current portion of long-term debt
322
118
Total Current Liabilities
1,425
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