Biomet Announces Record First Quarter Results

Biomet, Inc. (NASDAQ:BMET) today reported record sales
and earnings results for its first quarter ended August 31, 2006. Net
sales increased 5% to $508,161,000. Operating income increased 2% to
$155,043,000 from $151,410,000, and on an adjusted basis increased 7%
to $159,269,000. Net income increased 2% to $102,830,000 from
$100,299,000. and increased 6% on an adjusted basis to $106,815,000.
Diluted earnings per share increased 5% to $0.42 from $0.40, and
increased 10% on an adjusted basis to $0.44. Reported earnings per
share for the first quarter of fiscal year 2007 includes a $.02 per
share impact related to SFAS 123(R) Share-Based Payment. Effective
June 1, 2006, the Company adopted this new accounting standard using
the modified-prospective method. In accordance with this adoption
method, the Company is not adjusting its historical financial
statements to reflect the impact of share-based payment.
   Interim President and Chief Executive Officer Daniel P. Hann
stated, "The Company's record first quarter results are attributable
to continued strong sales of orthopedic reconstructive devices and
dental reconstructive implants. However, sales of Biomet Trauma and
Biomet Spine (formerly EBI) were approximately $12 million below
management's expectations for the first quarter of fiscal year 2007.
The Company has made numerous changes at its Biomet Trauma and Biomet
Spine subsidiary, including the appointment of Chuck Niemier, former
COO International Operations, as president, and the appointments of a
new vice president of finance and vice president of sales. We are also
making significant progress with the implementation of a new computer
system, sales support systems, the in-sourcing of the manufacture of
spinal hardware products, and expanding the research and development
team. Additionally, since May 31, 2005, the Company has eliminated
over 330 positions at the former EBI operations. We believe that the
new management team and infrastructure changes at Biomet Trauma and
Biomet Spine will allow the Company to provide greater focus on the
spine and trauma markets and to our customers."
   Excluding the impact of foreign currency, which increased sales by
$3 million, net sales increased 4%. First quarter sales in the United
States increased 3%, while international sales increased 7%, on a
constant currency basis.
   During the first quarter of fiscal year 2007, worldwide
reconstructive device sales increased 9% to $351,737,000. Excluding
the effects of foreign currency, reconstructive device sales increased
8% worldwide during the quarter. Knee sales increased 11% worldwide
and in the United States during the first quarter. On a constant
currency basis, knee sales increased 10% worldwide. Revenue growth for
knees during the first quarter continued to be driven by strong demand
for Biomet's recent product introductions for total and
unicompartmental knee replacement procedures.
   Hip sales increased 8% worldwide and 3% in the United States
during the first quarter. Worldwide hip sales increased 7%, constant
currency. The Company's metal-on-metal acetabular systems, porous
coated hip stems and second generation highly crosslinked polyethylene
components experienced increased market penetration during the first
quarter.
   Extremity sales increased 13% worldwide and 8% in the United
States during the first quarter. Excluding the impact of foreign
currency, worldwide extremity sales increased 12% during the quarter.
Dental reconstructive implant sales increased 11% worldwide and in the
United States during the first quarter. On a constant currency basis,
worldwide dental reconstructive implants sales increased 10%. Sales of
bone cements and accessories decreased 11% worldwide and increased 9%
in the United States during the first quarter. Sales of bone cements
and accessories decreased 12% worldwide, constant currency.
   Worldwide fixation sales decreased 5% to $60,873,000 during the
first quarter of fiscal year 2007 and decreased 9% in the United
States during the first quarter. Internal fixation sales increased 1%
worldwide and decreased 10% in the United States during the first
quarter. Excluding the effects of foreign currency, internal fixation
sales increased 1% worldwide. Lorenz Surgical's craniomaxillofacial
fixation sales decreased 4% worldwide and decreased 5% in the United
States during the first quarter. Electrical stimulation device sales
decreased 8% worldwide and in the United States during the first
quarter. Worldwide external fixation sales decreased 11% and decreased
16% in the United States during the quarter. On a constant currency
basis, worldwide external fixation sales decreased 11%.
   During the first quarter of fiscal year 2007, spinal product sales
decreased 6% worldwide to $51,933,000, and decreased 7% in the United
States. Spinal product sales decreased 7% worldwide, on a constant
currency basis. Sales of spinal implants and orthobiologics for the
spine decreased 4% worldwide and decreased 5% in the United States
during the first quarter. On a constant currency basis, spinal
implants and orthobiologics for the spine decreased 5% worldwide
during the first quarter. Spinal stimulation sales decreased 9%
worldwide and in the United States during the first quarter.
   Worldwide sales of Biomet's "other products" increased 5% to
$43,618,000 during the first quarter of fiscal year 2007 and increased
2% in the United States. Excluding the effects of foreign currency,
sales of "other products" increased 4% worldwide. Softgoods and
bracing sales increased 10% worldwide and increased 11% in the United
States during the first quarter. Softgoods and bracing sales increased
10% worldwide, constant currency. Arthroscopy sales increased 13%
worldwide and increased 6% in the United States during the first
quarter. On a constant currency basis, arthroscopy sales increased 12%
worldwide.
   Mr. Hann concluded, "We are pleased with Biomet's reconstructive
and dental reconstructive sales performance during the first quarter
of fiscal year 2007. As previously mentioned, the Company is
disappointed with the sales performance of its trauma and spinal
products in the United States. However, the Company is taking
aggressive, appropriate action to address the issues affecting its
trauma and spinal businesses and we expect to experience improved
sales performance and profitability at these businesses as we progress
through fiscal year 2007. We are comfortable with sales and earnings
estimates of $519 million to $540 million and $0.44 to $0.46 per share
for the second quarter of fiscal year 2007. This guidance does not
incorporate the effect of SFAS 123(R), Share-Based Payment, which the
Company estimates to be $0.01 to $0.02 per share for the second
quarter of fiscal year 2007."
   Biomet, Inc. and its subsidiaries design, manufacture and market
products used primarily by musculoskeletal medical specialists in both
surgical and non-surgical therapy. The Company's product portfolio
encompasses reconstructive products, including orthopedic joint
replacement devices, bone cements and accessories, and dental
reconstructive implants; fixation products, including electrical bone
growth stimulators, internal and external orthopedic fixation devices,
craniomaxillofacial implants and bone substitute materials; spinal
products, including spinal stimulation devices, spinal hardware and
orthobiologics; and other products, such as arthroscopy products and
softgoods and bracing products. Headquartered in Warsaw, Indiana,
Biomet and its subsidiaries currently distribute products in more than
100 countries.

   For further information contact Greg W. Sasso, Senior Vice
President, Corporate Development and Communications at [phone]
or Barbara Goslee, Manager, Corporate Communications at 
[phone].

   This press release contains certain statements that are
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934, as amended. Although the Company believes that the
assumptions, on which the forward-looking statements contained herein
are based, are reasonable, any of those assumptions could prove to be
inaccurate given the inherent uncertainties as to the occurrence or
non-occurrence of future events. There can be no assurance that the
forward-looking statements contained in this press release will prove
to be accurate. Some of the factors that could cause actual results to
differ from those contained in forward-looking statements made in this
press release include the success of the Company's principal product
lines and reorganization efforts with respect to its EBI operations,
the Company's ability to develop and market new products and
technologies in a timely manner, government regulation, currency
exchange rate fluctuations, reimbursements from third party payors,
litigation, revenue and earnings estimates, and other risk factors as
set forth from time to time in the Company's filings with the SEC. The
inclusion of a forward-looking statement herein should not be regarded
as a representation by the Company that the Company's objectives will
be achieved. The Company undertakes no obligation to publicly update
forward-looking statements, whether as a result of new information,
future events or otherwise.

   All of Biomet's financial information may be obtained on our
website at www.biomet.com or you may contact us by e-mail at
[e-mail].

   All trademarks are owned by Biomet, Inc., or one of its
subsidiaries.

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                             Biomet, Inc.
                Results for the quarter ended August 31
                 (in thousands, except per share data)

                                            Three Months Ended
                                     ---------------------------------

                                             2006            2005
                                     ------------------ --------------

Net Sales                                     $508,161       $484,903
Cost of Sales                                  138,747        134,495
                                     ------------------ --------------
Gross Profit                                   369,414        350,408

S, G, & A                                      190,010        178,182
R & D                                           24,361         20,816
                                     ------------------ --------------
Operating Income                               155,043        151,410

Other Income (Expense), Net                      1,113            558
                                     ------------------ --------------
Income Before Taxes                            156,156        151,968
Income Taxes                                    53,326         51,669
                                     ------------------ --------------
Net Income                                    $102,830       $100,299
                                     ================== ==============

Earnings per Share
Basic                                              .42            .40
Diluted                                            .42            .40

Basic Shares Outstanding                       244,881        249,582
Diluted Shares Outstanding                     244,881        250,656


U.S. sales                                    $325,947       $317,326
Foreign sales                                  182,214        167,577

Reconstructive sales                          $351,737       $323,815
Fixation sales                                  60,873         64,179
Spinal product sales                            51,933         55,326
Other product sales                             43,618         41,583


Consolidated Balance Sheets            August 31, 2006   May 31, 2006
Assets
  Cash and Investments                        $257,576       $225,471
  Accounts and notes receivable, net           493,639        507,883
  Inventories                                  560,410        534,515
  Other current assets                         106,955        105,687
  Fixed Assets, net                            363,550        357,632
  Goodwill                                     442,118        441,397
  Other Assets                                  93,592         91,337
                                     ------------------ --------------
   Total Assets                             $2,317,840     $2,263,922
                                     ================== ==============

Liabilities and Stockholders' Equity
  Current Liabilities                         $540,253       $520,432
  Other Liabilities                             28,971         26,991
  Stockholders' Equity                       1,748,616      1,716,499
                                     ------------------ --------------
    Total Liabilities and
     Stockholders' Equity                   $2,317,840     $2,263,922
                                     ================== ==============
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   Management uses non-GAAP financial measures, such as net sales,
excluding the impact of foreign currency, operating income as
adjusted, net income as adjusted, and diluted earning per share as
adjusted. The term "as adjusted", a non-GAAP financial measure, refers
to financial performance measures that exclude the effect of
share-based payments. The Company's management believes that the
presentation of these measures provides useful information to
investors. These measures may assist investors in evaluating the
Company's operations, period over period. Management uses these
measures internally for evaluation of the performance of the business,
including the allocation of resources and the evaluation of results
relative to team member performance compensation targets. Investors
should consider these non-GAAP measures only as a supplement to, not
as a substitute for or as superior to, measures of financial
performance prepared in accordance with GAAP.
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                             BIOMET, INC.
         Reconciliation of non-GAAP financial information to GAAP
                           financial information
              For the Three Months Ended August 31, 2006
                       (in millions, unaudited)


Operating income as reported                                 $155,043
Share-based payment                                             4,226
                                                           -----------
Operating income, as adjusted, excluding the effects of
 share-based payments                                         159,269
                                                           ===========

Net income, as reported                                      $102,830
Share-based payment, net of tax                                 3,985
                                                           -----------
Net income, as adjusted, excluding the effects of share-
 based payments                                              $106,815
                                                           ===========

Diluted EPS                                                     $0.42
Share-based payment, net of tax                                  0.02
                                                           -----------
Diluted EPS, as adjusted, excluding the effects of share-
 based payments                                                 $0.44
                                                           ===========


Current year sales growth as reported and in local currencies is as
 follows:

                         Sales Growth       FX       Sales Growth in
                          As Reported     Impact     Local Currencies

                                        Three Months
                                      -----------------
U.S. sales                         3%          0%           3%
Foreign sales                      9           2            7
Total sales                        5           1            4

Reconstructive sales               9%          1%           8%
Fixation sales                    (5)          0           (5)
Spinal product sales              (6)          1           (7)
Other product sales                5           1            4
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