- Revenues of $931 Million
- GAAP Net Loss Attributable to Bausch + Lomb Corporation of
$90 Million
- Adjusted EBITDA (non-GAAP)1 of $141 Million
- Revenues Grew 5% as Reported and 8% on a Constant Currency1
Basis Compared to the First Quarter of 2022, Driven by Growth
Across All Segments
- Foreign Exchange Negatively Impacted Revenues and Adjusted
EBITDA (non-GAAP)1 by $31 Million and $14 Million,
Respectively
Bausch + Lomb Corporation, (NYSE/TSX: BLCO) (“Bausch + Lomb” or
the “Company”, “we” or “our”), a leading global eye health company
dedicated to helping people see better to live better, today
announced its first-quarter 2023 financial results.
“Bausch + Lomb delivered a strong first quarter with continued
high-quality growth across all three reporting segments and in most
of our significant markets around the world,” said Brent Saunders,
chairman and CEO, Bausch + Lomb. “Revenues grew 5% on a reported
basis and 8% on a constant currency basis, driven by solid growth
from several key franchises within our Vision Care segment, strong
execution in our Ophthalmic Pharmaceuticals segment and increased
demand for consumables, intraocular lenses and systems in our
Surgical segment.
“Since returning to Bausch + Lomb 50 days ago, I’ve observed
that the Company has a solid foundation with favorable conditions
to support continued demand for our eye health products. Going
forward, my focus will be to build on this base and optimize
performance to enable Bausch + Lomb to become a best-in-class
global eye health company,” continued Mr. Saunders.
Select Company and Pipeline Highlights
- Acquired AcuFocus, Inc., whose IC-8® Apthera™
intraocular lens (“IOL”) was approved by the FDA as the first and
only small aperture non-toric extended depth of focus IOL for
certain cataract patients who have as much as 1.5 diopters of
corneal astigmatism and wish to address presbyopia at the same
time
- Launched PreserVision® AREDS 2 Formula mini soft gels with
OCUSorb® in the United States
- Introduced the SeeLuma™ Fully Digital Surgical Visualization
Platform in the United States and Western Europe in partnership
with Heidelberg Engineering
- Launched the StableVisc™ cohesive ophthalmic viscosurgical
device, as well as the TotalVisc™ Viscoelastic System, in the
United States
- Results from the two pivotal Phase 3 trials for NOV032
(perfluorohexyloctane), an investigational treatment with a
proposed indication of treating the signs and symptoms of dry eye
disease associated with Meibomian gland dysfunction, were published
in Ophthalmology and the American Journal of Ophthalmology,
respectively
- Acquired the rights to market LUMIFY® (brimonidine tartrate
ophthalmic solution 0.025%) in 18 additional countries
First-Quarter 2023 Revenue Performance
Total reported revenues were $931 million for the first quarter
of 2023, as compared to $889 million in the first quarter of 2022,
an increase of $42 million, or 5%. Excluding the unfavorable impact
of foreign exchange of $31 million, revenue increased by
approximately 8% on a constant currency1 basis compared to the
first quarter of 2022.
Revenues by segment were as follows:
First-Quarter 2023
(in millions)
Three Months Ended
March 31
Reported
Change
Reported
Change
Change at
Constant
Currency1
2023
2022
(non-GAAP)
Total Bausch + Lomb
Revenues
$931
$889
$42
5%
8%
Vision Care3
$587
$560
$27
5%
8%
Surgical
$183
$174
$9
5%
9%
Ophthalmic Pharmaceuticals3
$161
$155
$6
4%
7%
Vision Care Segment3
Vision Care segment revenues were $587 million for the first
quarter of 2023, as compared to $560 million for the first quarter
of 2022, an increase of $27 million, or 5%. Excluding the
unfavorable impact of foreign exchange of $20 million, segment
revenues increased on a constant currency basis1 by approximately
8% compared to the first quarter of 2022, primarily due to higher
sales of LUMIFY® (brimonidine tartrate ophthalmic solution 0.025%),
Bausch + Lomb INFUSE®/ULTRA® ONE DAY daily disposable silicone
hydrogel contact lenses, the Biotrue® franchise, Bausch + Lomb
ULTRA® monthly contact lenses and the Artelac® franchise.
Surgical Segment
Surgical segment revenues were $183 million for the first
quarter of 2023, as compared to $174 million for the first quarter
of 2022, an increase of $9 million, or 5%. Excluding the
unfavorable impact of foreign exchange of $6 million, segment
revenues increased on a constant currency basis1 by approximately
9% compared to the first quarter of 2022, primarily due to
increased sales of consumables, IOLs and systems.
Ophthalmic Pharmaceuticals Segment3
Ophthalmic Pharmaceuticals segment revenues were $161 million
for the first quarter of 2023, as compared to $155 million for the
first quarter of 2022, an increase of $6 million, or 4%. Excluding
the unfavorable impact of foreign exchange of $5 million, segment
revenues increased on a constant currency basis1 by approximately
7% compared to the first quarter of 2022, primarily due to higher
sales in the U.S. generics business and the international
portfolio.
Operating Results
Operating results in the first quarter of 2022 were prepared on
a carve-out basis and do not include expenses we are now incurring
as a publicly traded company, such as Interest expense and
standalone public company costs.
Operating loss was $2 million for the first quarter of 2023, as
compared to operating income of $54 million for the first quarter
of 2022, a decrease of $56 million. The change was largely driven
by an increase in Selling, general and administrative (“SG&A”)
expenses, due to dis-synergy costs in the first quarter of 2023
associated with the Company becoming a stand-alone entity
(following its initial public offering (“IPO”) in May 2022);
restructuring, integration and transformation costs; and higher
selling expenses due to inflationary factors mostly in freight and
distribution, and investment for upcoming product launches. The
change was also driven by an increase in Cost of goods sold,
primarily due to higher year over year inflationary pressures and
the ramp-up of new manufacturing lines for Bausch + Lomb
INFUSE®/ULTRA® ONE DAY daily disposable silicone hydrogel contact
lenses. The Company is continuing to maintain a disciplined
approach to cost management and to leverage its infrastructure.
Net Loss/Income
Net income attributable to Bausch + Lomb Corporation in the
first quarter of 2022 was prepared on a carve-out basis and does
not include expenses we are now incurring as a publicly traded
company, such as Interest expense, taxes and standalone public
company costs.
Net loss attributable to Bausch + Lomb Corporation for the first
quarter of 2023 was $90 million, as compared to a net income
attributable to Bausch + Lomb Corporation of $20 million for the
first quarter of 2022, a decrease of $110 million. The change was
primarily due to the decrease in operating results noted above, an
increase in the Provision for income taxes and an increase in
Interest expense.
Adjusted net income (non-GAAP)1 for the first quarter of 2023
was $34 million, as compared to $85 million for the first quarter
of 2022, a decrease of $51 million.
Cash from Operations
Cash flow from operations in the first quarter of 2022 was
prepared on a carve-out basis and does not include expenses we are
now incurring as a publicly traded company, such as Interest
expense and standalone public company costs.
Cash used by operations for the first quarter of 2023 was $56
million, as compared to cash flow from operations of $3 million for
the first quarter of 2022, a decrease of $59 million. Cash flow
from operations was negatively impacted in the first quarter of
2023 primarily by interest payments that were not incurred in the
first quarter of 2022, which was prior to our IPO, and a strategic
inventory build.
Earnings Per Share
GAAP Earnings Per Share (“EPS”) and Adjusted EPS (non-GAAP)1 for
the first quarter of 2022 has been calculated on a pro forma basis
after giving effect to our IPO.
GAAP EPS Basic and Diluted attributable to Bausch + Lomb
Corporation for the first quarter of 2023 was ($0.26), as compared
to $0.06 for the first quarter of 2022. Adjusted EPS (non-GAAP)1
for the first quarter of 2023 was $0.10, as compared to $0.24 for
the first quarter of 2022.
Adjusted EBITDA (non-GAAP)1
Adjusted EBITDA (non-GAAP)1 in the first quarter of 2022 was
prepared on a carve-out basis and does not include expenses we are
now incurring as a standalone publicly traded company.
Adjusted EBITDA (non-GAAP)1 was $141 million for the first
quarter of 2023, as compared to $170 million for the first quarter
of 2022, a decrease of $29 million, primarily due to dis-synergies
and foreign exchange headwinds, partially offset by revenue growth
across all three segments.
2023 Financial Outlook4
Bausch + Lomb provided guidance for the full year of 2023, as
follows:
- Full-year revenue range of $3.90 – $3.95 billion, reflecting
anticipated growth of 5-6% on a constant currency basis1
- Full-year Adjusted EBITDA (non-GAAP)1 range of $700 – $750
million
- $760 million at the mid-point of the full-year Adj. EBITDA
(non-GAAP) guidance range, adjusted for currency
headwinds1
- Foreign exchange revenue and Adjusted EBITDA (non-GAAP)1
headwinds expected to be approximately $50 million and $35 million
for the full year, respectively
Other than with respect to GAAP Revenues, the Company only
provides guidance on a non-GAAP basis. The Company does not provide
a reconciliation of forward-looking Adjusted EBITDA (non-GAAP)1 to
GAAP net income (loss) attributable to Bausch + Lomb Corporation,
of forward-looking Adjusted EBITDA (non-GAAP), adjusted for
currency headwinds1 to GAAP net income (loss) attributable to
Bausch + Lomb Corporation or of forward-looking constant currency
growth1 to reported revenue growth, due to the inherent difficulty
in forecasting and quantifying certain amounts that are necessary
for such reconciliations. These amounts may be material and,
therefore, could result in the projected GAAP measure or ratio
being materially different or less than the projected non-GAAP
measure or ratio. These statements represent forward-looking
information and may not represent a financial outlook, and actual
results may vary. Please see the risks and assumptions referred to
in the Forward-looking Statements section of this news release.
Balance Sheet Highlights
- Bausch + Lomb’s cash, cash equivalents and restricted cash were
$358 million at March 31, 2023
- Basic weighted average shares outstanding for the first quarter
of 2023 were 350 million, and diluted weighted average shares
outstanding for the first quarter of 2023 were 351.3 million
Conference Call Details
Date:
Wednesday, May 3, 2023
Time:
8:00 a.m. ET
Webcast:
https://www.webcaster4.com/Webcast/Page/2883/47444
Participant Event Dial-in:
+1 (888) 506-0062 (North
America)
+1 (973) 528-0011
(International)
Participant Access Code:
937525
Replay Dial-in:
+1 (877) 481-4010 (North
America)
+1 (919) 882-2331
(International)
Replay Passcode:
47444 (replay available until May
17, 2023)
About Bausch + Lomb
Bausch + Lomb is dedicated to protecting and enhancing the gift
of sight for millions of people around the world – from the moment
of birth through every phase of life. Its comprehensive portfolio
of more than 400 products includes contact lenses, lens care
products, eye care products, ophthalmic pharmaceuticals,
over-the-counter products and ophthalmic surgical devices and
instruments. Founded in 1853, Bausch + Lomb has a significant
global research and development, manufacturing and commercial
footprint with approximately 13,000 employees and a presence in
nearly 100 countries. Bausch + Lomb is headquartered in Vaughan,
Ontario with corporate offices in Bridgewater, New Jersey. For more
information, visit www.bausch.com and connect with us on Twitter,
LinkedIn, Facebook and Instagram.
Forward-looking Statements
This news release contains forward-looking information and
statements within the meaning of applicable securities laws
(collectively, “forward-looking statements”), which may generally
be identified by the use of the words “anticipates,” “hopes,”
“expects,” “intends,” “plans,” “projects,” “predicts,” “forecasts,”
“should,” “could,” “would,” “may,” “might,” “will,” “strive,”
“believes,” “estimates,” “potential,” “target,” or “continue” and
positive and negative variations or similar expressions and phrases
or statements that certain actions, events or results may, could,
should or will be achieved, received or taken, or will occur or
result, and similar such expressions also identify forward-looking
information. Forward-looking statements include statements
regarding Bausch + Lomb’s future prospects and performance,
including the Company’s 2023 full-year guidance, and details of the
Company’s product pipeline. These forward-looking statements,
including the Company’s full-year guidance, are based upon the
current expectations and beliefs of management and are provided for
the purpose of providing additional information about such
expectations and beliefs, and readers are cautioned that these
statements may not be appropriate for other purposes. These
forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially
from those described in the forward-looking statements. These risks
and uncertainties include, but are not limited to, the risks and
uncertainties discussed in Bausch + Lomb’s filings with the U.S.
Securities and Exchange Commission (“SEC”) and the Canadian
Securities Administrators (the “CSA”) (including the Company’s
Annual Report on Form 10-K for the year ended Dec. 31, 2022 and its
most recent quarterly filings), which factors are incorporated
herein by reference. They also include, but are not limited to,
risks and uncertainties relating to the proposed plan to spin off
or separate Bausch + Lomb from Bausch Health Companies Inc.
(“BHC”), including the expected benefits and costs of the spinoff
transaction, the expected timing of completion of the spinoff
transaction and its terms (including the expectation that the
spinoff transaction will be completed following the achievement of
targeted net leverage ratios, subject to receipt of applicable
shareholder and other necessary approvals), the ability to complete
the spinoff transaction considering the various conditions to the
completion of the spinoff transaction (some of which are outside
the Company’s and BHC’s control, including conditions related to
regulatory matters and receipt of applicable shareholder and other
approvals), the impact of any potential sales of the Company’s
common shares by BHC, that market or other conditions are no longer
favorable to completing the transaction, that applicable
shareholder, stock exchange, regulatory or other approval is not
obtained on the terms or timelines anticipated or at all, business
disruption during the pendency of or following the spinoff
transaction, diversion of management time on spinoff
transaction-related issues, retention of existing management team
members, the reaction of customers and other parties to the spinoff
transaction, the qualification of the spinoff transaction as a
tax-free transaction for Canadian and/or U.S. federal income tax
purposes (including whether or not an advance ruling from the
Canada Revenue Agency and/or the Internal Revenue Service will be
sought or obtained), the ability of the Company and BHC to satisfy
the conditions required to maintain the tax-free status of the
spinoff transaction (some of which are beyond their control), other
potential tax or other liabilities that may arise as a result of
the spinoff transaction, the potential dis-synergy costs resulting
from the spinoff transaction, the impact of the spinoff transaction
on relationships with customers, suppliers, employees and other
business counterparties, general economic conditions, conditions in
the markets the Company is engaged in, behavior of customers,
suppliers and competitors, technological developments and legal and
regulatory rules affecting the Company’s business. In particular,
the Company can offer no assurance that any spinoff transaction
will occur at all, or that any spinoff transaction will occur on
the terms and timelines anticipated by the Company and BHC. They
also include, but are not limited to, risks and uncertainties
caused by or relating to the evolving COVID-19 pandemic, including
the potential effects and economic and future impact of that
pandemic, which are highly uncertain and cannot be predicted, and
which may have a material adverse impact on the Company. Finally,
they also include, but are not limited to, risks and uncertainties
caused by or relating to a potential recession and other adverse
economic conditions (such as inflation and slower growth), which
could adversely impact our revenues, expenses and resulting
margins, and economic factors over which we have no control,
including inflationary pressures as a result of historically high
domestic and global inflation and otherwise, interest rates,
foreign currency rates, and the positional effect of such factors
on revenues, expenses and resulting margins. In addition, certain
material factors and assumptions have been applied in making these
forward-looking statements, including, without limitation, the
assumption that the risks and uncertainties outlined above will not
cause actual results or events to differ materially from those
described in these forward-looking statements. In addition, certain
assumptions have been made regarding our 2023 full-year guidance
with respect to expectations regarding base performance growth,
currency impact, run-rate dis-synergies and inflation, expectations
regarding adjusted gross margin (non-GAAP), adjusted SG&A
expense (non-GAAP) and the Company’s ability to continue to manage
such expense in the manner anticipated and the anticipated timing
and extent of the Company’s R&D expense.
Readers are cautioned not to place undue reliance on any of
these forward-looking statements. These forward-looking statements
speak only as of the date hereof. Bausch + Lomb undertakes no
obligation to update any of these forward-looking statements to
reflect events or circumstances after the date of this news release
or to reflect actual outcomes, unless required by law.
Non-GAAP Information
To supplement the financial measures prepared in accordance with
U.S. generally accepted accounting principles (GAAP), the Company
uses certain non-GAAP financial measures and ratios. Management
uses these non-GAAP measures and ratios as key metrics in the
evaluation of the Company’s performance and the consolidated
financial results and, in part, in the determination of cash
bonuses for its executive officers. The Company believes these
non-GAAP measures and ratios are useful to investors in their
assessment of our operating performance and the valuation of the
Company. In addition, these non-GAAP measures and ratios address
questions the Company routinely receives from analysts and
investors, and in order to assure that all investors have access to
similar data, the Company has determined that it is appropriate to
make this data available to all investors.
These measures and ratios do not have any standardized meaning
under GAAP and other companies may use similarly titled non-GAAP
financial measures and ratios that are calculated differently from
the way we calculate such measures and ratios. Accordingly, our
non-GAAP financial measures and ratios may not be comparable to
similar non-GAAP measures and ratios of other companies. We caution
investors not to place undue reliance on such non-GAAP measures and
ratios, but instead to consider them with the most directly
comparable GAAP measures and ratios. Non-GAAP financial measures
and ratios have limitations as analytical tools and should not be
considered in isolation. They should be considered as a supplement
to, not a substitute for, or superior to, the corresponding
measures calculated in accordance with GAAP.
The reconciliations of these historic non-GAAP financial
measures and ratios to the most directly comparable financial
measures and ratios calculated and presented in accordance with
GAAP are shown in the tables below.
Specific Non-GAAP Measures
EBITDA, Adjusted EBITDA and Adjusted
EBITDA, adjusted for currency headwinds
EBITDA (non-GAAP) is Net income (loss) attributable to Bausch +
Lomb Corporation (its most directly comparable U.S. GAAP financial
measure) adjusted for interest, income taxes, depreciation and
amortization. Adjusted EBITDA (non-GAAP) is EBITDA (non-GAAP)
further adjusted for the items described below. Management believes
that Adjusted EBITDA (non-GAAP), along with the GAAP measures used
by management, most appropriately reflect how the Company measures
the business internally and sets operational goals and incentives.
In particular, the Company believes that Adjusted EBITDA (non-GAAP)
focuses management on the Company’s underlying operational results
and business performance. As a result, the Company uses Adjusted
EBITDA (non-GAAP) both to assess the actual financial performance
of the Company and to forecast future results as part of its
guidance. Management believes Adjusted EBITDA (non-GAAP) is a
useful measure to evaluate current performance. Adjusted EBITDA
(non-GAAP) is intended to show our unleveraged, pre-tax operating
results and therefore reflects our financial performance based on
operational factors. In addition, cash bonuses for the Company’s
executive officers and other key employees are based, in part, on
the achievement of certain Adjusted EBITDA (non-GAAP) targets.
Adjusted EBITDA (non-GAAP) is Net income (loss) attributable to
Bausch + Lomb Corporation (its most directly comparable U.S. GAAP
financial measure) adjusted for interest expense, net, (benefit
from) provision for income taxes, depreciation and amortization and
further adjusted for the following items:
- Asset impairments: The Company has
excluded the impact of impairments of finite-lived and
indefinite-lived intangible assets as such amounts are inconsistent
in amount and frequency and are significantly impacted by the
timing and/or size of acquisitions and divestitures. The Company
believes that the adjustments of these items correlate with the
sustainability of the Company’s operating performance. Although the
Company excludes impairments of intangible assets from measuring
the performance of the Company and its business, the Company
believes that it is important for investors to understand that
intangible assets contribute to revenue generation.
- Restructuring, integration and
transformation costs: The Company has incurred restructuring
costs as it implemented certain strategies, which involved, among
other things, improvements to its infrastructure and operations,
internal reorganizations and impacts from the divestiture of assets
and businesses. With regard to infrastructure and operational
improvements which the Company has taken to improve efficiencies in
the businesses and facilities, these tend to be costs intended to
right size the business or organization that fluctuate
significantly between periods in amount, size and timing, depending
on the improvement project, reorganization or transaction.
Additionally, with the completion of the Bausch + Lomb IPO, as the
Company prepares for post-Separation operations, the Company is
launching certain transformation initiatives that will result in
certain changes to and investment in its organizational structure
and operations. These transformation initiatives arise outside of
the ordinary course of continuing operations and, as is the case
with the Company’s restructuring efforts, costs associated with
these transformation initiatives are expected to fluctuate between
periods in amount, size and timing. These
out-of-the-ordinary-course charges include third-party advisory
costs, as well as certain compensation-related costs (including
costs associated with changes in our executive officers, such as
the severance costs associated with the departure of the Company’s
former CEO and the costs associated with the appointment of the
Company's new CEO). Investors should understand that the outcome of
these transformation initiatives may result in future restructuring
actions and certain of these charges could recur. The Company
believes that the adjustments of these items provide supplemental
information with regard to the sustainability of the Company’s
operating performance, allow for a comparison of the financial
results to historical operations and forward-looking guidance and,
as a result, provide useful supplemental information to
investors.
- Acquisition-related costs and adjustments
excluding amortization of intangible assets: The Company
excludes the impact of acquisition-related contingent consideration
non-cash adjustments due to the inherent uncertainty and volatility
associated with such amounts based on changes in assumptions with
respect to fair value estimates, and the amount and frequency of
such adjustments are not consistent and are significantly impacted
by the timing and size of the Company’s acquisitions, as well as
the nature of the agreed-upon consideration.
- Share-based compensation: The
Company excludes costs relating to share-based compensation. The
Company believes that the exclusion of share-based compensation
expense assists investors in the comparisons of operating results
to peer companies. Share-based compensation expense can vary
significantly based on the timing, size and nature of awards
granted.
- Separation costs and separation-related
costs: The Company has excluded certain costs incurred in
connection with activities taken to: (i) separate the Bausch + Lomb
business from the remainder of BHC and (ii) register the Bausch +
Lomb business as an independent publicly traded entity. Separation
costs are incremental costs directly related to effectuating the
separation of the Bausch + Lomb business from the remainder of BHC
and include, but are not limited to, legal, audit and advisory
fees, talent acquisition costs and costs associated with
establishing a new Board of Directors and Audit Committee.
Separation-related costs are incremental costs indirectly related
to the separation of the Bausch + Lomb business from the remainder
of BHC and include, but are not limited to, IT infrastructure and
software licensing costs, rebranding costs and costs associated
with facility relocation and/or modification. As these costs arise
from events outside of the ordinary course of continuing
operations, the Company believes that the adjustments of these
items provide supplemental information with regard to the
sustainability of the Company’s operating performance, allow for a
comparison of the financial results to historical operations and
forward-looking guidance and, as a result, provide useful
supplemental information to investors.
- Other Non-GAAP adjustments: The
Company also excludes certain other amounts, including IT
infrastructure investment, litigation and other matters,
gain/(loss) on sales of assets and certain other amounts that are
the result of other, non-comparable events to measure operating
performance if and when present in the periods presented. These
events arise outside of the ordinary course of continuing
operations. Given the unique nature of the matters relating to
these costs, the Company believes these items are not routine
operating expenses. For example, legal settlements and judgments
vary significantly, in their nature, size and frequency, and, due
to this volatility, the Company believes the costs associated with
legal settlements and judgments are not routine operating expenses.
The Company has also excluded certain other costs, including
settlement costs associated with the conversion of a portion of the
Company’s defined benefit plan in Ireland to a defined contribution
plan. The Company excluded these costs as this event is outside of
the ordinary course of continuing operations and is infrequent in
nature. The Company believes that the exclusion of such
out-of-the-ordinary-course amounts provides supplemental
information to assist in the comparison of the financial results of
the Company from period to period and, therefore, provides useful
supplemental information to investors. However, investors should
understand that many of these costs could recur and that companies
in our industry often face litigation.
Adjusted EBITDA, adjusted for currency headwinds is Adjusted
EBITDA (non-GAAP) further adjusted for the impact or the
anticipated impact of foreign exchange. The Company uses this
non-GAAP measure as part of the guidance it provides to its
investors. Although changes due to foreign exchange movements are
part of our business, they are not within management’s control.
These changes, however, can mask positive or negative trends in the
underlying business performance. Accordingly, the Company believes
the measure is useful to investors in assessing our performance.
For guidance purposes, the Company has further adjusted Adjusted
EBITDA (non-GAAP) for the anticipated impact of foreign exchange
for full-year 2023.
Adjusted Net Income (non-GAAP)
Adjusted net income (non-GAAP) is net income (loss) attributable
to Bausch + Lomb Corporation (its most directly comparable GAAP
financial measure) adjusted for asset impairments, restructuring,
integration and transformation costs, acquisition-related
contingent consideration, separation costs and separation-related
costs and other non-GAAP adjustments, as these adjustments are
described above, and further adjusted for amortization of
intangible assets, as described below:
- Amortization of intangible assets:
The Company has excluded the impact of amortization of intangible
assets, as such amounts are inconsistent in amount and frequency
and are significantly impacted by the timing and/or size of
acquisitions. The Company believes that the adjustments of these
items correlate with the sustainability of the Company’s operating
performance. Although the Company excludes the amortization of
intangible assets from its non-GAAP expenses, the Company believes
that it is important for investors to understand that such
intangible assets contribute to revenue generation. Amortization of
intangible assets that relate to past acquisitions will recur in
future periods until such intangible assets have been fully
amortized. Any future acquisitions may result in the amortization
of additional intangible assets.
Adjusted net income (non-GAAP) excludes the impact of these
certain items that may obscure trends in the Company’s underlying
performance. Management uses Adjusted net income (non-GAAP) for
strategic decision making, forecasting future results and
evaluating current performance. By disclosing this non-GAAP
measure, it is management’s intention to provide investors with a
meaningful, supplemental comparison of the Company’s operating
results and trends for the periods presented. Management believes
that this measure is also useful to investors as such measure
allows investors to evaluate the Company’s performance using the
same tools that management uses to evaluate past performance and
prospects for future performance. Accordingly, the Company believes
that Adjusted net income (non-GAAP) is useful to investors in their
assessment of the Company’s operating performance and the valuation
of the Company. It is also noted that, in recent periods, our GAAP
net income (loss) attributable to Bausch + Lomb Corporation was
significantly lower than our Adjusted net income (non-GAAP).
Constant Currency
Constant currency change or constant currency revenue growth is
a change in GAAP Revenue (its most directly comparable GAAP
financial measure) on a period-over-period basis adjusted for
changes in foreign currency exchange rates. The Company uses
Constant Currency Revenues (non-GAAP) and Constant Currency Revenue
Growth (non-GAAP) to assess performance of its reportable segments,
and the Company in total, without the impact of foreign currency
exchange fluctuations. The Company believes that such measures are
useful to investors as they provide a supplemental period-to-period
comparison. Although changes in foreign currency exchange rates are
part of our business, they are not within management’s control.
Changes in foreign currency exchange rates, however, can mask
positive or negative trends in the underlying business performance.
Constant currency impact is determined by comparing 2023 reported
amounts adjusted to exclude currency impact, calculated using 2022
monthly average exchange rates, to the actual 2022 reported
amounts.
Adjusted EPS (non-GAAP)
Adjusted earnings per share or Adjusted EPS (non-GAAP) is
calculated as Diluted income per share attributable to Bausch +
Lomb Corporation (“GAAP EPS”) (its most directly comparable GAAP
financial measure), adjusted for the per diluted share impact of
each adjustment made to reconcile Net income (loss) attributable to
Bausch + Lomb Corporation to Adjusted net income (non-GAAP) as
discussed above. Like Adjusted net income (non-GAAP), Adjusted EPS
(non-GAAP) excludes the impact of certain items that may obscure
trends in the Company’s underlying performance on a per share
basis. By disclosing this non-GAAP measure, it is management’s
intention to provide investors with a meaningful, supplemental
comparison of the Company’s results and trends for the periods
presented on a diluted share basis. Accordingly, the Company
believes that Adjusted EPS (non-GAAP) is useful to investors in
their assessment of the Company’s operating performance, the
valuation of the Company and an investor’s return on investment. It
is also noted that, for the periods presented, our GAAP EPS was
significantly lower than our Adjusted EPS (non-GAAP).
_____________________________
1
This is a non-GAAP measure or a
non-GAAP ratio. For further information on non-GAAP measures and
non-GAAP ratios, please refer to the “Non-GAAP Information” section
of this news release. Please also refer to tables at the end of
this news release for a reconciliation of this and other non-GAAP
measures to the most directly comparable GAAP measure.
2
In 2019, the Company acquired an
exclusive license from Novaliq GmbH for the commercialization and
development of NOV03 in the United States and Canada.
3
Effective in the first quarter of
2023, certain products historically included in the reported
results of the Ophthalmic Pharmaceuticals segment are now included
in the reported results of the Vision Care segment and certain
products included in the reported results of the Vision Care
segment are now included in the reported results of the Ophthalmic
Pharmaceuticals segment. Management believes these movements are
necessary in order to better align these products with the
groupings of similar products. The net impact of these product
movements was not material to the periods presented. Prior period
presentations of segment revenues have been conformed to the
current segment reporting structure.
4
The guidance in this news release
is only effective as of the date given, May 3, 2023, and will not
be updated or affirmed unless and until the Company publicly
announces updated or affirmed guidance. Distribution or reference
of this news release following May 3, 2023 does not constitute the
Company reaffirming guidance. See the “Forward-looking Statements”
section for further information.
Unless otherwise indicated, ®/™ are trademarks of Bausch + Lomb
Corporation or its affiliates.
OCUSorb® is a trademark of Omniactive Health Technologies
Limited used under license.
Any other product/brand names are trademarks of the respective
owners.
© 2023 Bausch & Lomb Incorporated or its affiliates.
FINANCIAL TABLES FOLLOW
Bausch + Lomb Corporation
Table 1
Consolidated Statements of
Operations
For the Three Months Ended March 31,
2023 and 2022
(unaudited)
Three Months Ended
March 31,
(in millions, except per share
amounts)
2023
2022
Revenues
Product sales
$
928
$
883
Other revenues
3
6
931
889
Expenses
Cost of goods sold (excluding amortization
and impairments of intangible assets)
371
346
Cost of other revenues
1
2
Selling, general and administrative
418
343
Research and development
77
77
Amortization of intangible assets
57
65
Other expense, net
9
2
933
835
Operating (loss) income
(2
)
54
Interest income
3
—
Interest expense
(50
)
(20
)
Foreign exchange and other
(6
)
(5
)
(Loss) income before provision for
income taxes
(55
)
29
Provision for income taxes
(33
)
(6
)
Net (loss) income
(88
)
23
Net income attributable to noncontrolling
interest
(2
)
(3
)
Net (loss) income attributable to
Bausch + Lomb Corporation
$
(90
)
$
20
Basic and diluted (loss) income per
share attributable to Bausch + Lomb Corporation
$
(0.26
)
$
0.06
Basic and diluted weighted-average
common shares
350
350
Bausch + Lomb
Corporation
Table 2
Reconciliation of GAAP Net
(Loss) Income and Diluted (Loss) Income per Share Attributable to
Bausch + Lomb Corporation to Adjusted Net Income (non-GAAP) and
Adjusted Earnings Per Share (non-GAAP)
For the Three Months Ended
March 31, 2023 and 2022
(unaudited)
Three Months Ended March
31,
2023
2022
(in millions, except per share
amounts)
Income
(Expense)
Earnings per
Share
Impact (b)
Income
(Expense)
Earnings per
Share
Impact (b)
Net (loss) income and Diluted (loss)
income per share attributable to Bausch + Lomb Corporation
$
(90
)
$
(0.26
)
$
20
$
0.06
Non-GAAP adjustments: (a)
Amortization of intangible assets
57
0.16
65
0.19
Restructuring, integration and
transformation costs
32
0.09
3
—
Acquisition-related costs and adjustments
(excluding amortization of intangible assets)
1
—
—
—
Separation costs and separation-related
costs
3
0.01
4
0.01
Other
—
—
6
0.02
Tax effect of non-GAAP adjustments
31
0.10
(13
)
(0.04
)
Total non-GAAP adjustments
124
0.36
65
0.18
Adjusted net income (non-GAAP) and
Adjusted earnings per share (non-GAAP)
$
34
$
0.10
$
85
$
0.24
(a)
The components of and further
details respecting each of these non-GAAP adjustments and the
financial statement line item to which each component relates can
be found on Table 2a.
(b)
On April 28, 2022, Bausch + Lomb
effected a share consolidation as a result of which it had
350,000,000 issued and outstanding common shares. These common
shares are treated as issued and outstanding at January 1, 2022 for
purposes of calculating Basic and diluted income per share
attributable to Bausch + Lomb Corporation.
Bausch + Lomb Corporation
Table 2a
Reconciliation of GAAP to Non-GAAP
Financial Information
For the Three Months Ended March 31,
2023 and 2022
(unaudited)
Three Months Ended
March 31,
(in millions)
2023
2022
Selling, general and administrative
reconciliation:
GAAP Selling, general and
administrative
$
418
$
343
Separation-related costs (a)
(3
)
(4
)
Transformation costs (b)
(24
)
(1
)
Adjusted selling, general and
administrative (non-GAAP)
$
391
$
338
Amortization of intangible assets
reconciliation:
GAAP Amortization of intangible assets
$
57
$
65
Amortization of intangible assets (c)
(57
)
(65
)
Adjusted amortization of intangible assets
(non-GAAP)
$
—
$
—
Other expense, net
reconciliation:
GAAP Other expense, net
$
9
$
2
Restructuring and integration costs
(b)
(8
)
(2
)
Acquisition-related costs (d)
(1
)
—
Adjusted other expense, net (non-GAAP)
$
—
$
—
Foreign exchange and other
reconciliation:
GAAP Foreign exchange and other
$
(6
)
$
(5
)
Other (e)
—
6
Adjusted foreign exchange and other
(non-GAAP)
$
(6
)
$
1
Provision for income taxes
reconciliation:
GAAP Provision for income taxes
$
(33
)
$
(6
)
Tax effect of non-GAAP adjustments (f)
31
(13
)
Adjusted provision for income taxes
(non-GAAP)
$
(2
)
$
(19
)
(a)
Represents the sole component of
the non-GAAP adjustment of “Separation and separation-related
costs” (see Table 2).
(b)
Represents the two components of
the non-GAAP adjustment of “Restructuring, integration and
transformation costs” (see Table 2).
(c)
Represents the sole component of
the non-GAAP adjustment of “Amortization of intangible assets” (see
Table 2).
(d)
Represents the sole component of
the non-GAAP adjustment of “Acquisition-related costs and
adjustments (excluding amortization of intangible assets)” (see
Table 2).
(e)
Represents the sole component of
the non-GAAP adjustment of “Other” (see Table 2).
(f)
Represents the sole component of
the non-GAAP adjustment of “Tax effect of non-GAAP adjustments”
(see Table 2).
Bausch + Lomb Corporation
Table 2b
Reconciliation of GAAP Net (Loss)
Income to Adjusted EBITDA (non-GAAP)
For the Three Months Ended March 31,
2023 and 2022
(unaudited)
Three Months Ended
March 31,
(in millions)
2023
2022
Net (loss) income attributable to
Bausch + Lomb Corporation
$
(90
)
$
20
Interest expense, net
47
20
Provision for income taxes
33
6
Depreciation and amortization of
intangible assets
91
95
EBITDA
81
141
Adjustments:
Restructuring, integration and
transformation costs
32
3
Acquisition-related costs and adjustments
(excluding amortization of intangible assets)
1
—
Share-based compensation
24
16
Separation and Separation-related
costs
3
4
Other non-GAAP adjustments:
Other
—
6
Adjusted EBITDA (non-GAAP)
$
141
$
170
Bausch + Lomb
Corporation
Table 3
Constant Currency Revenue
(non-GAAP) and Constant Currency Revenue Growth (non-GAAP) - by
Segment
For the Three Months Ended
March 31, 2023 and 2022
(unaudited)
Calculation of Constant
Currency Revenue for the Three
Months Ended
March 31, 2023
March 31, 2022
Change in Revenue as
Reported
Change in
Constant
Currency
Revenue
Revenue
as
Reported
Changes in
Exchange
Rates (a)
Constant
Currency
Revenue
(Non-GAAP) (b)
Revenue
as
Reported
(in millions)
Amount
Pct.
Amount
Pct.
Vision Care (c)
$
587
$
20
$
607
$
560
$
27
5
%
$
47
8
%
Surgical
183
6
189
174
9
5
%
15
9
%
Ophthalmic Pharmaceuticals (c)
161
5
166
155
6
4
%
11
7
%
Total revenues
$
931
$
31
$
962
$
889
$
42
5
%
$
73
8
%
(a)
The impact for changes in foreign
currency exchange rates is determined as the difference in the
current period reported revenues at their current period currency
exchange rates and the current period reported revenues revalued
using the monthly average currency exchange rates during the
comparable prior period.
(b)
To supplement the financial
measures prepared in accordance with GAAP, the Company uses certain
non-GAAP financial measures. For additional information about the
Company’s use of such non-GAAP financial measures, refer to the
“Non-GAAP Information” section in the body of the news release to
which these tables are attached. Constant currency revenue
(non-GAAP) for the three months ended March 31, 2023 is calculated
as revenue as reported adjusted for the impact for changes in
exchange rates (previously defined in this news release).
(c)
Effective in the first quarter of
2023, certain products historically included in the reported
results of the Ophthalmic Pharmaceuticals segment are now included
in the reported results of the Vision Care segment and certain
products included in the reported results of the Vision Care
segment are now included in the reported results of the Ophthalmic
Pharmaceuticals segment. Management believes these movements are
necessary in order to better align these products with the
groupings of similar products. The net impact of these product
movements was not material to the periods presented. Prior period
presentations of segment revenues have been conformed to the
current segment reporting structure.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230503005303/en/
Investor Contacts: Arthur Shannon
arthur.shannon@bausch.com
Allison Ryan allison.ryan@bausch.com (877) 354-3705 (toll free)
(908) 927-0735
Media Contacts: Lainie Keller lainie.keller@bausch.com
(908) 927-1198
Kristy Marks kristy.marks@bausch.com (908) 927-0683
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