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Share Name | Share Symbol | Market | Type |
---|---|---|---|
DENTSPLY SIRONA Inc | NASDAQ:XRAY | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.09 | -0.32% | 28.29 | 28.30 | 32.34 | 29.06 | 27.96 | 28.75 | 4,506,597 | 01:00:00 |
Delaware
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39-1434669
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(State or other jurisdiction of
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(I.R.S. Employer
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incorporation or organization)
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Identification No.)
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221 West Philadelphia Street, York, PA
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17401-2991
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
x
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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Emerging growth company
o
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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.
o
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Page
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Three Months Ended March 31,
|
||||||
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2017
|
|
2016
|
||||
|
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|
||||
Net sales
|
$
|
900.5
|
|
|
$
|
772.6
|
|
Cost of products sold
|
408.5
|
|
|
353.7
|
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||
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|
||||
Gross profit
|
492.0
|
|
|
418.9
|
|
||
Selling, general and administrative expenses
|
404.7
|
|
|
342.1
|
|
||
Restructuring and other costs
|
3.1
|
|
|
4.1
|
|
||
|
|
|
|
||||
Operating income
|
84.2
|
|
|
72.7
|
|
||
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|
||||
Other income and expenses:
|
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|
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|
||
Interest expense
|
9.3
|
|
|
9.2
|
|
||
Interest income
|
(0.7
|
)
|
|
(0.5
|
)
|
||
Other expense (income), net
|
(1.0
|
)
|
|
(3.4
|
)
|
||
|
|
|
|
||||
Income before income taxes
|
76.6
|
|
|
67.4
|
|
||
Provision (benefit) for income taxes
|
16.9
|
|
|
(57.9
|
)
|
||
|
|
|
|
||||
Net income
|
59.7
|
|
|
125.3
|
|
||
|
|
|
|
||||
Less: Net (loss) income attributable to noncontrolling interests
|
(0.1
|
)
|
|
0.3
|
|
||
|
|
|
|
||||
Net income attributable to Dentsply Sirona
|
$
|
59.8
|
|
|
$
|
125.0
|
|
|
|
|
|
||||
Earnings per common share attributable to Dentsply Sirona:
|
|
|
|
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|
||
Basic
|
$
|
0.26
|
|
|
$
|
0.72
|
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Diluted
|
$
|
0.26
|
|
|
$
|
0.70
|
|
|
|
|
|
||||
Weighted average common shares outstanding:
|
|
|
|
|
|
||
Basic
|
230.1
|
|
|
174.8
|
|
||
Diluted
|
234.0
|
|
|
178.4
|
|
|
Three Months Ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
|
|
|
|
||||
Net income
|
$
|
59.7
|
|
|
$
|
125.3
|
|
|
|
|
|
||||
Other comprehensive income (loss), net of tax:
|
|
|
|
||||
Foreign currency translation gain
|
49.7
|
|
|
186.8
|
|
||
Net loss on derivative financial instruments
|
(3.3
|
)
|
|
(24.8
|
)
|
||
Pension liability gain
|
1.2
|
|
|
0.9
|
|
||
Total other comprehensive income (loss), net of tax
|
47.6
|
|
|
162.9
|
|
||
|
|
|
|
||||
Total comprehensive income
|
107.3
|
|
|
288.2
|
|
||
|
|
|
|
||||
Less: Comprehensive (loss) income attributable
|
|
|
|
||||
to noncontrolling interests
|
(0.2
|
)
|
|
0.4
|
|
||
|
|
|
|
||||
Comprehensive income attributable to Dentsply Sirona
|
$
|
107.5
|
|
|
$
|
287.8
|
|
|
|
|
|
|
March 31, 2017
|
|
December 31, 2016
|
||||
Assets
|
|
|
|
||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
363.3
|
|
|
$
|
383.9
|
|
Accounts and notes receivables-trade, net
|
598.6
|
|
|
636.0
|
|
||
Inventories, net
|
565.1
|
|
|
517.1
|
|
||
Prepaid expenses and other current assets, net
|
193.6
|
|
|
173.5
|
|
||
|
|
|
|
||||
Total Current Assets
|
1,720.6
|
|
|
1,710.5
|
|
||
|
|
|
|
||||
Property, plant and equipment, net
|
807.1
|
|
|
799.8
|
|
||
Identifiable intangible assets, net
|
2,955.1
|
|
|
2,957.6
|
|
||
Goodwill, net
|
5,958.2
|
|
|
5,952.0
|
|
||
Other noncurrent assets, net
|
153.0
|
|
|
107.7
|
|
||
|
|
|
|
||||
Total Assets
|
$
|
11,594.0
|
|
|
$
|
11,527.6
|
|
|
|
|
|
||||
Liabilities and Equity
|
|
|
|
|
|
||
Current Liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
258.4
|
|
|
$
|
223.0
|
|
Accrued liabilities
|
424.3
|
|
|
462.7
|
|
||
Income taxes payable
|
42.1
|
|
|
60.8
|
|
||
Notes payable and current portion of long-term debt
|
22.7
|
|
|
21.1
|
|
||
|
|
|
|
||||
Total Current Liabilities
|
747.5
|
|
|
767.6
|
|
||
|
|
|
|
||||
Long-term debt
|
1,528.1
|
|
|
1,511.1
|
|
||
Deferred income taxes
|
753.2
|
|
|
723.5
|
|
||
Other noncurrent liabilities
|
401.6
|
|
|
399.5
|
|
||
|
|
|
|
||||
Total Liabilities
|
3,430.4
|
|
|
3,401.7
|
|
||
|
|
|
|
||||
Commitments and contingencies
|
|
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||
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|
||||
Equity:
|
|
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|
||
Preferred stock, $1.00 par value; 0.25 million shares authorized; no shares issued
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value;
|
2.6
|
|
|
2.6
|
|
||
400.0 million shares authorized at March 31, 2017 and December 31, 2016, respectively
|
|
|
|
||||
264.5 million shares issued at March 31, 2017 and December 31, 2016, respectively
|
|
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|
||||
229.9 million and 230.1 million shares outstanding at March 31, 2017 and December 31, 2016, respectively
|
|
|
|
||||
Capital in excess of par value
|
6,516.2
|
|
|
6,516.7
|
|
||
Retained earnings
|
3,986.4
|
|
|
3,948.0
|
|
||
Accumulated other comprehensive loss
|
(658.0
|
)
|
|
(705.7
|
)
|
||
Treasury stock, at cost, 34.6 million and 34.4 million shares at March 31, 2017 and December 31, 2016, respectively
|
(1,695.0
|
)
|
|
(1,647.3
|
)
|
||
Total Dentsply Sirona Equity
|
8,152.2
|
|
|
8,114.3
|
|
||
|
|
|
|
||||
Noncontrolling interests
|
11.4
|
|
|
11.6
|
|
||
|
|
|
|
||||
Total Equity
|
8,163.6
|
|
|
8,125.9
|
|
||
|
|
|
|
||||
Total Liabilities and Equity
|
$
|
11,594.0
|
|
|
$
|
11,527.6
|
|
|
Three Months Ended March 31,
|
||||||
|
2017
|
|
2016
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income
|
$
|
59.7
|
|
|
$
|
125.3
|
|
|
|
|
|
||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||
Depreciation
|
30.9
|
|
|
23.5
|
|
||
Amortization of intangible assets
|
45.2
|
|
|
21.8
|
|
||
Amortization of deferred financing costs
|
0.7
|
|
|
1.1
|
|
||
Deferred income taxes
|
9.8
|
|
|
(80.4
|
)
|
||
Stock based compensation expense
|
10.8
|
|
|
4.8
|
|
||
Restructuring and other costs - non-cash
|
0.6
|
|
|
2.6
|
|
||
Stock option income tax benefit
|
—
|
|
|
(8.4
|
)
|
||
Other non-cash income
|
(14.4
|
)
|
|
(3.4
|
)
|
||
Loss on disposal of property, plant and equipment
|
0.3
|
|
|
—
|
|
||
Changes in operating assets and liabilities, net of acquisitions:
|
|
|
|
|
|
||
Accounts and notes receivable-trade, net
|
46.2
|
|
|
(67.1
|
)
|
||
Inventories, net
|
(38.3
|
)
|
|
8.6
|
|
||
Prepaid expenses and other current assets, net
|
(9.2
|
)
|
|
(16.9
|
)
|
||
Other noncurrent assets, net
|
(14.4
|
)
|
|
(2.4
|
)
|
||
Accounts payable
|
23.4
|
|
|
1.2
|
|
||
Accrued liabilities
|
(36.0
|
)
|
|
(15.5
|
)
|
||
Income taxes
|
(31.4
|
)
|
|
(1.1
|
)
|
||
Other noncurrent liabilities
|
(1.4
|
)
|
|
7.0
|
|
||
|
|
|
|
||||
Net cash provided by operating activities
|
82.5
|
|
|
0.7
|
|
||
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
|
|
||
|
|
|
|
||||
Capital expenditures
|
(31.1
|
)
|
|
(20.8
|
)
|
||
Cash assumed in Merger
|
—
|
|
|
522.3
|
|
||
Cash and deposits paid for acquisitions of businesses, net of cash acquired
|
(9.1
|
)
|
|
(0.4
|
)
|
||
Cash received from sale of business or product line
|
—
|
|
|
2.4
|
|
||
Cash received on derivatives contracts
|
2.4
|
|
|
5.7
|
|
||
Cash paid on derivatives contracts
|
—
|
|
|
(3.5
|
)
|
||
Expenditures for identifiable intangible assets
|
(4.8
|
)
|
|
—
|
|
||
Purchase of short-term investments
|
(0.1
|
)
|
|
—
|
|
||
Purchase of Company-owned life insurance policies
|
—
|
|
|
(1.7
|
)
|
||
Proceeds from sale of property, plant and equipment, net
|
1.6
|
|
|
0.4
|
|
||
|
|
|
|
||||
Net cash (used in) provided by investing activities
|
(41.1
|
)
|
|
504.4
|
|
||
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
||
|
|
|
|
||||
Increase (decrease) in short-term borrowings
|
1.3
|
|
|
(2.1
|
)
|
||
Cash paid for treasury stock
|
(77.9
|
)
|
|
(428.8
|
)
|
||
Cash dividends paid
|
(18.0
|
)
|
|
(10.1
|
)
|
||
Proceeds from long-term borrowings
|
3.0
|
|
|
79.9
|
|
||
Repayments on long-term borrowings
|
(5.4
|
)
|
|
(127.5
|
)
|
||
Proceeds from exercised stock options
|
29.4
|
|
|
7.4
|
|
||
Excess tax benefits from stock based compensation
|
—
|
|
|
8.4
|
|
||
|
|
|
|
||||
Net cash used in financing activities
|
(67.6
|
)
|
|
(472.8
|
)
|
||
|
|
|
|
||||
Effect of exchange rate changes on cash and cash equivalents
|
5.6
|
|
|
6.2
|
|
||
|
|
|
|
||||
Net (decrease) increase in cash and cash equivalents
|
(20.6
|
)
|
|
38.5
|
|
||
|
|
|
|
||||
Cash and cash equivalents at beginning of period
|
383.9
|
|
|
284.6
|
|
||
|
|
|
|
||||
Cash and cash equivalents at end of period
|
$
|
363.3
|
|
|
$
|
323.1
|
|
|
|
|
|
||||
Schedule of non-cash investing activities:
|
|
|
|
||||
Merger financed by common stock
|
$
|
—
|
|
|
$
|
6,256.2
|
|
|
Common
Stock
|
|
Capital in
Excess of
Par Value
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Treasury
Stock
|
|
Total Dentsply Sirona
Equity |
|
Noncontrolling
Interests
|
|
Total
Equity
|
||||||||||||||||
Balance at December 31, 2015
|
$
|
1.6
|
|
|
$
|
237.8
|
|
|
$
|
3,591.0
|
|
|
$
|
(594.0
|
)
|
|
$
|
(898.4
|
)
|
|
$
|
2,338.0
|
|
|
$
|
1.4
|
|
|
$
|
2,339.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
125.0
|
|
|
—
|
|
|
—
|
|
|
125.0
|
|
|
0.3
|
|
|
125.3
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
162.8
|
|
|
—
|
|
|
162.8
|
|
|
0.1
|
|
|
162.9
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Common stock issuance related to Merger
|
1.0
|
|
|
6,253.4
|
|
|
|
|
|
|
|
|
6,254.4
|
|
|
1.8
|
|
|
6,256.2
|
|
|||||||||||
Exercise of stock options
|
—
|
|
|
(1.6
|
)
|
|
—
|
|
|
—
|
|
|
9.0
|
|
|
7.4
|
|
|
—
|
|
|
7.4
|
|
||||||||
Tax benefit from stock options exercised
|
—
|
|
|
8.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.4
|
|
|
—
|
|
|
8.4
|
|
||||||||
Stock based compensation expense
|
—
|
|
|
4.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.8
|
|
|
—
|
|
|
4.8
|
|
||||||||
Funding of Employee Stock Ownership Plan
|
—
|
|
|
2.1
|
|
|
—
|
|
|
—
|
|
|
4.2
|
|
|
6.3
|
|
|
—
|
|
|
6.3
|
|
||||||||
Treasury shares purchased
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(500.0
|
)
|
|
(500.0
|
)
|
|
—
|
|
|
(500.0
|
)
|
||||||||
RSU distributions
|
—
|
|
|
(15.4
|
)
|
|
—
|
|
|
—
|
|
|
8.4
|
|
|
(7.0
|
)
|
|
—
|
|
|
(7.0
|
)
|
||||||||
RSU dividends
|
—
|
|
|
0.2
|
|
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Cash dividends ($0.0775 per share)
|
—
|
|
|
—
|
|
|
(18.3
|
)
|
|
—
|
|
|
—
|
|
|
(18.3
|
)
|
|
—
|
|
|
(18.3
|
)
|
||||||||
Balance at March 31, 2016
|
$
|
2.6
|
|
|
$
|
6,489.7
|
|
|
$
|
3,697.5
|
|
|
$
|
(431.2
|
)
|
|
$
|
(1,376.8
|
)
|
|
$
|
8,381.8
|
|
|
$
|
3.6
|
|
|
$
|
8,385.4
|
|
|
Common
Stock
|
|
Capital in
Excess of
Par Value
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Treasury
Stock
|
|
Total Dentsply Sirona
Equity |
|
Noncontrolling
Interests
|
|
Total
Equity
|
||||||||||||||||
Balance at December 31, 2016
|
$
|
2.6
|
|
|
$
|
6,516.7
|
|
|
$
|
3,948.0
|
|
|
$
|
(705.7
|
)
|
|
$
|
(1,647.3
|
)
|
|
$
|
8,114.3
|
|
|
$
|
11.6
|
|
|
$
|
8,125.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
59.8
|
|
|
—
|
|
|
—
|
|
|
59.8
|
|
|
(0.1
|
)
|
|
59.7
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
47.7
|
|
|
—
|
|
|
47.7
|
|
|
(0.1
|
)
|
|
47.6
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Exercise of stock options
|
—
|
|
|
4.9
|
|
|
—
|
|
|
—
|
|
|
24.5
|
|
|
29.4
|
|
|
—
|
|
|
29.4
|
|
||||||||
Stock based compensation expense
|
—
|
|
|
10.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10.8
|
|
|
—
|
|
|
10.8
|
|
||||||||
Reclassification on adoption of ASU No. 2016-09 (see Note 1)
|
—
|
|
|
1.0
|
|
|
(1.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Funding of Employee Stock Ownership Plan
|
—
|
|
|
3.3
|
|
|
—
|
|
|
—
|
|
|
3.3
|
|
|
6.6
|
|
|
—
|
|
|
6.6
|
|
||||||||
Treasury shares purchased
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(84.6
|
)
|
|
(84.6
|
)
|
|
—
|
|
|
(84.6
|
)
|
||||||||
RSU distributions
|
—
|
|
|
(20.7
|
)
|
|
—
|
|
|
—
|
|
|
9.1
|
|
|
(11.6
|
)
|
|
—
|
|
|
(11.6
|
)
|
||||||||
RSU dividends
|
—
|
|
|
0.2
|
|
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Cash dividends ($0.0875 per share)
|
—
|
|
|
—
|
|
|
(20.2
|
)
|
|
—
|
|
|
—
|
|
|
(20.2
|
)
|
|
—
|
|
|
(20.2
|
)
|
||||||||
Balance at March 31, 2017
|
$
|
2.6
|
|
|
$
|
6,516.2
|
|
|
$
|
3,986.4
|
|
|
$
|
(658.0
|
)
|
|
$
|
(1,695.0
|
)
|
|
$
|
8,152.2
|
|
|
$
|
11.4
|
|
|
$
|
8,163.6
|
|
|
|
Three Months Ended
|
||||||
(in millions)
|
|
2017
|
|
2016
|
||||
|
|
|
|
|
||||
Stock option expense
|
|
$
|
2.7
|
|
|
$
|
2.1
|
|
RSU expense
|
|
7.7
|
|
|
2.4
|
|
||
Total stock based compensation expense
|
|
$
|
10.4
|
|
|
$
|
4.5
|
|
|
|
|
|
|
||||
Related deferred income tax benefit
|
|
$
|
3.3
|
|
|
$
|
1.3
|
|
|
|
Three Months Ended
|
||||||
(in millions)
|
|
2017
|
|
2016
|
||||
|
|
|
|
|
||||
Foreign currency translation gains
|
|
$
|
59.3
|
|
|
$
|
198.4
|
|
Foreign currency translation loss on hedges of net investments
|
|
(9.5
|
)
|
|
(11.7
|
)
|
(in millions)
|
|
Foreign Currency Translation Gain (Loss)
|
|
Gain and (Loss) on Derivative Financial Instruments Designated as Cash Flow Hedges
|
|
Gain and (Loss) on Derivative Financial Instruments
|
|
Pension Liability Gain (Loss)
|
|
Total
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance, net of tax, at December 31, 2016
|
|
$
|
(490.5
|
)
|
|
$
|
(3.2
|
)
|
|
$
|
(116.8
|
)
|
|
$
|
(95.2
|
)
|
|
$
|
(705.7
|
)
|
Other comprehensive income (loss) before reclassifications and tax impact
|
|
40.2
|
|
|
(1.7
|
)
|
|
(1.9
|
)
|
|
—
|
|
|
36.6
|
|
|||||
Tax (expense) benefit
|
|
9.6
|
|
|
0.6
|
|
|
(0.3
|
)
|
|
—
|
|
|
9.9
|
|
|||||
Other comprehensive income (loss), net of tax, before reclassifications
|
|
49.8
|
|
|
(1.1
|
)
|
|
(2.2
|
)
|
|
—
|
|
|
46.5
|
|
|||||
Amounts reclassified from accumulated other comprehensive income (loss), net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.2
|
|
|
1.2
|
|
|||||
Net increase (decrease) in other comprehensive income
|
|
49.8
|
|
|
(1.1
|
)
|
|
(2.2
|
)
|
|
1.2
|
|
|
47.7
|
|
|||||
Balance, net of tax, at March 31, 2017
|
|
$
|
(440.7
|
)
|
|
$
|
(4.3
|
)
|
|
$
|
(119.0
|
)
|
|
$
|
(94.0
|
)
|
|
$
|
(658.0
|
)
|
(in millions)
|
|
Foreign Currency Translation Gain (Loss)
|
|
Gain and (Loss) on Derivative Financial Instruments Designated as Cash Flow Hedges
|
|
Gain and (Loss) on Derivative Financial Instruments
|
|
Pension Liability Gain (Loss)
|
|
Total
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance, net of tax, at December 31, 2015
|
|
$
|
(401.2
|
)
|
|
$
|
(1.2
|
)
|
|
$
|
(110.2
|
)
|
|
$
|
(81.4
|
)
|
|
$
|
(594.0
|
)
|
Other comprehensive (loss) income before reclassifications and tax impact
|
|
183.3
|
|
|
(6.5
|
)
|
|
(30.4
|
)
|
|
—
|
|
|
146.4
|
|
|||||
Tax (expense) benefit
|
|
8.3
|
|
|
2.3
|
|
|
11.7
|
|
|
—
|
|
|
22.3
|
|
|||||
Other comprehensive (loss) income, net of tax, before reclassifications
|
|
191.6
|
|
|
(4.2
|
)
|
|
(18.7
|
)
|
|
—
|
|
|
168.7
|
|
|||||
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax
|
|
(4.9
|
)
|
|
(1.9
|
)
|
|
—
|
|
|
0.9
|
|
|
(5.9
|
)
|
|||||
Net (decrease) increase in other comprehensive income
|
|
186.7
|
|
|
(6.1
|
)
|
|
(18.7
|
)
|
|
0.9
|
|
|
162.8
|
|
|||||
Balance, net of tax, at March 31, 2016
|
|
$
|
(214.5
|
)
|
|
$
|
(7.3
|
)
|
|
$
|
(128.9
|
)
|
|
$
|
(80.5
|
)
|
|
$
|
(431.2
|
)
|
Basic Earnings Per Common Share Computation
|
|
Three Months Ended
|
||||||
(in millions, except per share amounts)
|
|
2017
|
|
2016
|
||||
|
|
|
|
|
||||
Net income attributable to Dentsply Sirona
|
|
$
|
59.8
|
|
|
$
|
125.0
|
|
|
|
|
|
|
||||
Weighted average common shares outstanding
|
|
230.1
|
|
|
174.8
|
|
||
|
|
|
|
|
||||
Earnings per common share - basic
|
|
$
|
0.26
|
|
|
$
|
0.72
|
|
|
|
|
|
|
||||
Diluted Earnings Per Common Share Computation
|
|
|
|
|
||||
(in millions, except per share amounts)
|
|
|
|
|
||||
|
|
|
|
|
||||
Net income attributable to Dentsply Sirona
|
|
$
|
59.8
|
|
|
$
|
125.0
|
|
|
|
|
|
|
||||
Weighted average common shares outstanding
|
|
230.1
|
|
|
174.8
|
|
||
Incremental weighted average shares from assumed exercise of
dilutive options from stock-based compensation awards
|
|
3.9
|
|
|
3.6
|
|
||
Total weighted average diluted shares outstanding
|
|
234.0
|
|
|
178.4
|
|
||
|
|
|
|
|
||||
Earnings per common share - diluted
|
|
$
|
0.26
|
|
|
$
|
0.70
|
|
(in millions, except for useful life)
|
|
|
|
Weighted Average
|
||
|
|
|
|
Useful Life
|
||
|
|
Amount
|
|
(in years)
|
||
|
|
|
|
|
||
Customer relationships
|
|
$
|
495.0
|
|
|
14
|
Developed technology and patents
|
|
1,035.0
|
|
|
12
|
|
Trade names and trademarks
|
|
905.0
|
|
|
Indefinite
|
|
Total
|
|
$
|
2,435.0
|
|
|
|
|
|
Pro forma - unaudited
|
||
|
|
Three Months Ended
|
||
(in millions, except per share amount)
|
|
March 31, 2016
|
||
|
|
|
||
Net sales
|
|
$
|
940.2
|
|
Net income attributable to Dentsply Sirona
|
|
$
|
93.7
|
|
Diluted earnings per common share
|
|
$
|
0.39
|
|
|
|
Three Months Ended
|
||||||
(in millions)
|
|
2017
|
|
2016
|
||||
|
|
|
|
|
||||
Dental and Healthcare Consumables
|
|
$
|
511.2
|
|
|
$
|
488.8
|
|
Technologies
|
|
389.3
|
|
|
283.8
|
|
||
Total net sales
|
|
$
|
900.5
|
|
|
$
|
772.6
|
|
|
|
Three Months Ended
|
||||||
(in millions)
|
|
2017
|
|
2016
|
||||
|
|
|
|
|
||||
Dental and Healthcare Consumables
|
|
$
|
500.2
|
|
|
$
|
470.9
|
|
Technologies
|
|
389.2
|
|
|
283.6
|
|
||
Total net sales, excluding precious metal content
|
|
889.4
|
|
|
754.5
|
|
||
Precious metal content of sales
|
|
11.1
|
|
|
18.1
|
|
||
Total net sales, including precious metal content
|
|
$
|
900.5
|
|
|
$
|
772.6
|
|
|
|
Three Months Ended
|
||||||
(in millions)
|
|
2017
|
|
2016
|
||||
|
|
|
|
|
||||
Dental and Healthcare Consumables
|
|
$
|
136.5
|
|
|
$
|
130.8
|
|
Technologies
|
|
54.0
|
|
|
53.8
|
|
||
Segment adjusted operating income before income taxes and interest
|
|
190.5
|
|
|
184.6
|
|
||
|
|
|
|
|
||||
Reconciling items (income) expense:
|
|
|
|
|
||||
All Other
(a)
|
|
56.5
|
|
|
85.2
|
|
||
Restructuring and other costs
|
|
3.1
|
|
|
4.1
|
|
||
Interest expense
|
|
9.3
|
|
|
9.2
|
|
||
Interest income
|
|
(0.7
|
)
|
|
(0.5
|
)
|
||
Other expense (income), net
|
|
(1.0
|
)
|
|
(3.4
|
)
|
||
Amortization of intangible assets
|
|
45.2
|
|
|
21.8
|
|
||
Depreciation resulting from the fair value step-up of property,
plant and equipment from business combinations
|
|
1.5
|
|
|
0.8
|
|
||
Income before income taxes
|
|
$
|
76.6
|
|
|
$
|
67.4
|
|
(in millions)
|
|
March 31, 2017
|
|
December 31, 2016
|
||||
|
|
|
|
|
||||
Finished goods
|
|
$
|
343.5
|
|
|
$
|
311.3
|
|
Work-in-process
|
|
85.6
|
|
|
77.1
|
|
||
Raw materials and supplies
|
|
136.0
|
|
|
128.7
|
|
||
Inventories, net
|
|
$
|
565.1
|
|
|
$
|
517.1
|
|
Defined Benefit Plans
|
|
Three Months Ended
|
||||||
(in millions)
|
|
2017
|
|
2016
|
||||
|
|
|
|
|
||||
Service cost
|
|
$
|
3.8
|
|
|
$
|
3.8
|
|
Interest cost
|
|
1.7
|
|
|
1.8
|
|
||
Expected return on plan assets
|
|
(1.1
|
)
|
|
(1.2
|
)
|
||
Amortization of net actuarial loss
|
|
1.6
|
|
|
1.2
|
|
||
Net periodic benefit cost
|
|
$
|
6.0
|
|
|
$
|
5.6
|
|
Other Postemployment Benefit Plans
|
|
Three Months Ended
|
||||||
(in millions)
|
|
2017
|
|
2016
|
||||
|
|
|
|
|
||||
Service cost
|
|
$
|
0.1
|
|
|
$
|
0.1
|
|
Interest cost
|
|
0.1
|
|
|
0.1
|
|
||
Amortization of net actuarial loss
|
|
0.1
|
|
|
0.1
|
|
||
Net periodic benefit cost
|
|
$
|
0.3
|
|
|
$
|
0.3
|
|
(in millions)
|
|
Pension
Benefits
|
|
Other
Postemployment Benefits
|
||||
|
|
|
|
|
||||
Actual contributions through March 31, 2017
|
|
$
|
2.9
|
|
|
$
|
0.1
|
|
Projected contributions for the remainder of the year
|
|
11.4
|
|
|
0.6
|
|
||
Total projected contributions
|
|
$
|
14.3
|
|
|
$
|
0.7
|
|
|
|
Severance
|
||||||||||||||
(in millions)
|
|
2015 and
Prior Plans
|
|
2016 Plans
|
|
2017 Plans
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Balance at December 31, 2016
|
|
$
|
20.6
|
|
|
$
|
8.2
|
|
|
$
|
—
|
|
|
$
|
28.8
|
|
Provisions
|
|
0.4
|
|
|
(0.1
|
)
|
|
0.7
|
|
|
1.0
|
|
||||
Amounts applied
|
|
(2.5
|
)
|
|
(1.4
|
)
|
|
(0.2
|
)
|
|
(4.1
|
)
|
||||
Change in estimates
|
|
(0.5
|
)
|
|
(0.1
|
)
|
|
—
|
|
|
(0.6
|
)
|
||||
Balance at March 31, 2017
|
|
$
|
18.0
|
|
|
$
|
6.6
|
|
|
$
|
0.5
|
|
|
$
|
25.1
|
|
|
|
Lease/Contract Terminations
|
||||||||||||||
(in millions)
|
|
2015 and
Prior Plans |
|
2016 Plans
|
|
2017 Plans
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Balance at December 31, 2016
|
|
$
|
2.7
|
|
|
$
|
0.3
|
|
|
$
|
—
|
|
|
$
|
3.0
|
|
Provisions
|
|
0.5
|
|
|
—
|
|
|
0.1
|
|
|
0.6
|
|
||||
Amounts applied
|
|
(0.6
|
)
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
(0.8
|
)
|
||||
Balance at March 31, 2017
|
|
$
|
2.6
|
|
|
$
|
0.2
|
|
|
$
|
—
|
|
|
$
|
2.8
|
|
|
|
Other Restructuring Costs
|
||||||||||||||
(in millions)
|
|
2015 and
Prior Plans |
|
2016 Plans
|
|
2017 Plans
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Balance at December 31, 2016
|
|
$
|
0.5
|
|
|
$
|
0.2
|
|
|
$
|
—
|
|
|
$
|
0.7
|
|
Provisions
|
|
0.3
|
|
|
0.5
|
|
|
—
|
|
|
0.8
|
|
||||
Amounts applied
|
|
(0.2
|
)
|
|
(0.5
|
)
|
|
—
|
|
|
(0.7
|
)
|
||||
Change in estimate
|
|
0.5
|
|
|
—
|
|
|
—
|
|
|
0.5
|
|
||||
Balance at March 31, 2017
|
|
$
|
1.1
|
|
|
$
|
0.2
|
|
|
$
|
—
|
|
|
$
|
1.3
|
|
(in millions)
|
|
December 31, 2016
|
|
Provisions
|
|
Amounts
Applied
|
|
Change in Estimates
|
|
March 31, 2017
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Dental and Healthcare Consumables
|
|
$
|
27.9
|
|
|
$
|
1.8
|
|
|
$
|
(5.0
|
)
|
|
$
|
—
|
|
|
$
|
24.7
|
|
Technologies
|
|
4.5
|
|
|
0.4
|
|
|
(0.5
|
)
|
|
(0.1
|
)
|
|
4.3
|
|
|||||
All Other
|
|
0.1
|
|
|
0.2
|
|
|
(0.1
|
)
|
|
—
|
|
|
0.2
|
|
|||||
Total
|
|
$
|
32.5
|
|
|
$
|
2.4
|
|
|
$
|
(5.6
|
)
|
|
$
|
(0.1
|
)
|
|
$
|
29.2
|
|
|
|
Aggregate
Notional
Amount
|
|
Aggregate Notional Amount Maturing within 12 Months
|
||||
|
|
|
||||||
(in millions)
|
|
|
||||||
|
|
|
|
|
||||
Foreign exchange forward contracts
|
|
$
|
293.8
|
|
|
$
|
223.5
|
|
Interest rate swaps
|
|
112.8
|
|
|
—
|
|
||
Total derivative instruments designated as cash flow hedges
|
|
$
|
406.6
|
|
|
$
|
223.5
|
|
|
|
March 31, 2017
|
||||||||||||
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Effective Portion Reclassified from AOCI into Income (Expense)
|
|
Ineffective Portion Recognized in Income (Expense)
|
||||||
|
|
|
|
|
||||||||||
(in millions)
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
||||||
Effective Portion:
|
|
|
|
|
|
|
|
|
||||||
Interest rate swaps
|
|
$
|
(0.2
|
)
|
|
Interest expense
|
|
$
|
(0.8
|
)
|
|
$
|
—
|
|
Foreign exchange forward contracts
|
|
(1.5
|
)
|
|
Cost of products sold
|
|
0.5
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
|
|
||||||
Ineffective Portion:
|
|
|
|
|
|
|
|
|
||||||
Foreign exchange forward contracts
|
|
—
|
|
|
Other expense (income), net
|
|
—
|
|
|
(0.3
|
)
|
|||
Total in cash flow hedging
|
|
$
|
(1.7
|
)
|
|
|
|
$
|
(0.3
|
)
|
|
$
|
(0.3
|
)
|
|
|
March 31, 2016
|
||||||||||||
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Effective Portion Reclassified from AOCI into Income (Expense)
|
|
Ineffective Portion Recognized in Income (Expense)
|
||||||
|
|
|
|
|
||||||||||
(in millions)
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
||||||
Effective Portion:
|
|
|
|
|
|
|
|
|
||||||
Interest rate swaps
|
|
$
|
(1.2
|
)
|
|
Interest expense
|
|
$
|
(1.1
|
)
|
|
$
|
—
|
|
Foreign exchange forward contracts
|
|
(4.9
|
)
|
|
Cost of products sold
|
|
3.1
|
|
|
—
|
|
|||
Foreign exchange forward contracts
|
|
(0.3
|
)
|
|
SG&A expenses
|
|
0.1
|
|
|
—
|
|
|||
Commodity contracts
|
|
(0.1
|
)
|
|
Cost of products sold
|
|
(0.2
|
)
|
|
—
|
|
|||
Total for cash flow hedging
|
|
$
|
(6.5
|
)
|
|
|
|
$
|
1.9
|
|
|
$
|
—
|
|
|
|
Aggregate
Notional
Amount
|
|
Aggregate Notional Amount Maturing within 12 Months
|
||||
|
|
|
||||||
(in millions)
|
|
|
||||||
|
|
|
|
|
||||
Foreign exchange forward contracts
|
|
$
|
64.5
|
|
|
$
|
64.5
|
|
|
|
March 31, 2017
|
||||||||
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Recognized in Income (Expense)
|
||||
|
|
|
|
|||||||
(in millions)
|
|
|
|
|||||||
|
|
|
|
|
|
|
||||
Effective Portion:
|
|
|
|
|
|
|
||||
Foreign exchange forward contracts
|
|
$
|
(1.9
|
)
|
|
Other expense (income), net
|
|
$
|
0.5
|
|
Total for net investment hedging
|
|
$
|
(1.9
|
)
|
|
|
|
$
|
0.5
|
|
|
|
March 31, 2016
|
||||||||
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Recognized in Income (Expense)
|
||||
|
|
|
|
|||||||
(in millions)
|
|
|
|
|||||||
|
|
|
|
|
|
|
||||
Effective Portion:
|
|
|
|
|
|
|
||||
Foreign exchange forward contracts
|
|
$
|
(30.4
|
)
|
|
Other expense (income), net
|
|
$
|
2.6
|
|
Total for net investment hedging
|
|
$
|
(30.4
|
)
|
|
|
|
$
|
2.6
|
|
|
|
Aggregate
Notional
Amount
|
|
Aggregate Notional Amount Maturing within 12 Months
|
||||
|
|
|
||||||
(in millions)
|
|
|
||||||
|
|
|
|
|
||||
Foreign exchange forward contracts
|
|
$
|
356.9
|
|
|
$
|
356.9
|
|
Interest rate swaps
|
|
0.8
|
|
|
0.8
|
|
||
Total for instruments not designated as hedges
|
|
$
|
357.7
|
|
|
$
|
357.7
|
|
|
|
Consolidated Statements of Operations Location
|
|
Gain (Loss) Recognized
|
||||||
|
|
|
Three Months Ended
|
|||||||
(in millions)
|
|
|
2017
|
|
2016
|
|||||
|
|
|
|
|
|
|
||||
Foreign exchange forward contracts (a)
|
|
Other expense (income), net
|
|
$
|
(2.8
|
)
|
|
$
|
(16.4
|
)
|
Total for instruments not designated as hedges
|
|
|
|
$
|
(2.8
|
)
|
|
$
|
(16.4
|
)
|
|
|
March 31, 2017
|
||||||||||||||
(in millions)
|
|
Prepaid
Expenses
and Other
Current Assets, Net
|
|
Other
Noncurrent
Assets, Net
|
|
Accrued
Liabilities
|
|
Other
Noncurrent
Liabilities
|
||||||||
Designated as Hedges
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward contracts
|
|
$
|
7.2
|
|
|
$
|
0.2
|
|
|
$
|
1.1
|
|
|
$
|
0.1
|
|
Interest rate swaps
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|
0.2
|
|
||||
Total
|
|
$
|
7.2
|
|
|
$
|
0.2
|
|
|
$
|
1.3
|
|
|
$
|
0.3
|
|
|
|
|
|
|
|
|
|
|
||||||||
Not Designated as Hedges
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward contracts
|
|
$
|
1.8
|
|
|
$
|
—
|
|
|
$
|
3.7
|
|
|
$
|
—
|
|
Total
|
|
$
|
1.8
|
|
|
$
|
—
|
|
|
$
|
3.7
|
|
|
$
|
—
|
|
|
|
December 31, 2016
|
||||||||||||||
(in millions)
|
|
Prepaid
Expenses and Other Current Assets, Net |
|
Other
Noncurrent
Assets, Net
|
|
Accrued
Liabilities
|
|
Other
Noncurrent
Liabilities
|
||||||||
Designated as Hedges
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward contracts
|
|
$
|
12.8
|
|
|
$
|
0.6
|
|
|
$
|
1.0
|
|
|
$
|
—
|
|
Interest rate swaps
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|
0.3
|
|
||||
Total
|
|
$
|
12.8
|
|
|
$
|
0.6
|
|
|
$
|
1.2
|
|
|
$
|
0.3
|
|
|
|
|
|
|
|
|
|
|
||||||||
Not Designated as Hedges
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward contracts
|
|
$
|
1.3
|
|
|
$
|
—
|
|
|
$
|
1.5
|
|
|
$
|
—
|
|
Total
|
|
$
|
1.3
|
|
|
$
|
—
|
|
|
$
|
1.5
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
Gross Amounts Not Offset in the Consolidated Balance Sheets
|
|
|
||||||||||||||
(in millions)
|
|
Gross Amounts Recognized
|
|
Gross Amount Offset in the Consolidated Balance Sheets
|
|
Net Amounts Presented
in the Consolidated Balance Sheets
|
|
Financial Instruments
|
|
Cash Collateral Received/Pledged
|
|
Net Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange forward contracts
|
|
$
|
9.2
|
|
|
$
|
—
|
|
|
$
|
9.2
|
|
|
$
|
(2.7
|
)
|
|
$
|
—
|
|
|
$
|
6.5
|
|
Total Assets
|
|
$
|
9.2
|
|
|
$
|
—
|
|
|
$
|
9.2
|
|
|
$
|
(2.7
|
)
|
|
$
|
—
|
|
|
$
|
6.5
|
|
|
|
|
|
|
|
|
|
Gross Amounts Not Offset in the Consolidated Balance Sheets
|
|
|
||||||||||||||
(in millions)
|
|
Gross Amounts Recognized
|
|
Gross Amount Offset in the Consolidated Balance Sheets
|
|
Net Amounts Presented
in the Consolidated Balance Sheets
|
|
Financial Instruments
|
|
Cash Collateral Received/Pledged
|
|
Net Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange forward contracts
|
|
$
|
4.9
|
|
|
$
|
—
|
|
|
$
|
4.9
|
|
|
$
|
(2.5
|
)
|
|
$
|
—
|
|
|
$
|
2.4
|
|
Interest rate swaps
|
|
0.4
|
|
|
—
|
|
|
0.4
|
|
|
(0.2
|
)
|
|
—
|
|
|
0.2
|
|
||||||
Total Liabilities
|
|
$
|
5.3
|
|
|
$
|
—
|
|
|
$
|
5.3
|
|
|
$
|
(2.7
|
)
|
|
$
|
—
|
|
|
$
|
2.6
|
|
|
|
|
|
|
|
|
|
Gross Amounts Not Offset in the Consolidated Balance Sheets
|
|
|
||||||||||||||
(in millions)
|
|
Gross Amounts Recognized
|
|
Gross Amount Offset in the Consolidated Balance Sheets
|
|
Net Amounts Presented in the Consolidated Balance Sheets
|
|
Financial Instruments
|
|
Cash Collateral Received/Pledged
|
|
Net Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange forward contracts
|
|
$
|
14.7
|
|
|
$
|
—
|
|
|
$
|
14.7
|
|
|
$
|
(2.8
|
)
|
|
$
|
—
|
|
|
$
|
11.9
|
|
Total Assets
|
|
$
|
14.7
|
|
|
$
|
—
|
|
|
$
|
14.7
|
|
|
$
|
(2.8
|
)
|
|
$
|
—
|
|
|
$
|
11.9
|
|
|
|
|
|
|
|
|
|
Gross Amounts Not Offset in the Consolidated Balance Sheets
|
|
|
||||||||||||||
(in millions)
|
|
Gross Amounts Recognized
|
|
Gross Amount Offset in the Consolidated Balance Sheets
|
|
Net Amounts Presented in the Consolidated Balance Sheets
|
|
Financial Instruments
|
|
Cash Collateral Received/Pledged
|
|
Net Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Foreign exchange forward contracts
|
|
$
|
2.5
|
|
|
$
|
—
|
|
|
$
|
2.5
|
|
|
$
|
(2.5
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest rate swaps
|
|
0.5
|
|
|
—
|
|
|
0.5
|
|
|
(0.3
|
)
|
|
—
|
|
|
0.2
|
|
||||||
Total Liabilities
|
|
$
|
3.0
|
|
|
$
|
—
|
|
|
$
|
3.0
|
|
|
$
|
(2.8
|
)
|
|
$
|
—
|
|
|
$
|
0.2
|
|
|
|
March 31, 2017
|
||||||||||||||
(in millions)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward contracts
|
|
$
|
9.2
|
|
|
$
|
—
|
|
|
$
|
9.2
|
|
|
$
|
—
|
|
Total assets
|
|
$
|
9.2
|
|
|
$
|
—
|
|
|
$
|
9.2
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swaps
|
|
$
|
0.4
|
|
|
$
|
—
|
|
|
$
|
0.4
|
|
|
$
|
—
|
|
Foreign exchange forward contracts
|
|
4.9
|
|
|
—
|
|
|
4.9
|
|
|
—
|
|
||||
Contingent considerations on acquisitions
|
|
7.9
|
|
|
—
|
|
|
—
|
|
|
7.9
|
|
||||
Total liabilities
|
|
$
|
13.2
|
|
|
$
|
—
|
|
|
$
|
5.3
|
|
|
$
|
7.9
|
|
|
|
December 31, 2016
|
||||||||||||||
(in millions)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange forward contracts
|
|
14.7
|
|
|
—
|
|
|
14.7
|
|
|
—
|
|
||||
Total assets
|
|
$
|
14.7
|
|
|
$
|
—
|
|
|
$
|
14.7
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swaps
|
|
$
|
0.5
|
|
|
$
|
—
|
|
|
$
|
0.5
|
|
|
$
|
—
|
|
Foreign exchange forward contracts
|
|
2.5
|
|
|
—
|
|
|
2.5
|
|
|
—
|
|
||||
Contingent considerations on acquisitions
|
|
7.6
|
|
|
—
|
|
|
—
|
|
|
7.6
|
|
||||
Total liabilities
|
|
$
|
10.6
|
|
|
$
|
—
|
|
|
$
|
3.0
|
|
|
$
|
7.6
|
|
|
|
Earn-out
|
||
(in millions)
|
|
Obligations
|
||
|
|
|
||
Balance at December 31, 2016
|
|
$
|
7.6
|
|
Unrealized gain:
|
|
|
||
Reported in Other expense (income), net
|
|
0.2
|
|
|
Effect of exchange rate changes
|
|
0.1
|
|
|
Balance at March 31, 2017
|
|
$
|
7.9
|
|
(in millions)
|
|
Dental and Healthcare Consumables
|
|
Technologies
|
|
Total
|
||||||
|
|
|
|
|
|
|
||||||
Balance at December 31, 2016
|
|
$
|
1,091.2
|
|
|
$
|
4,860.8
|
|
|
$
|
5,952.0
|
|
Adjustments of provisional amounts on prior acquisitions
|
|
(24.3
|
)
|
|
4.6
|
|
|
(19.7
|
)
|
|||
Effects of exchange rate changes
|
|
9.3
|
|
|
16.6
|
|
|
25.9
|
|
|||
Balance at March 31, 2017
|
|
$
|
1,076.2
|
|
|
$
|
4,882.0
|
|
|
$
|
5,958.2
|
|
|
|
March 31, 2017
|
|
December 31, 2016
|
||||||||||||||||||||
(in millions)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Patents and developed technology
|
|
$
|
1,203.5
|
|
|
$
|
(204.1
|
)
|
|
$
|
999.4
|
|
|
$
|
1,189.5
|
|
|
$
|
(177.3
|
)
|
|
$
|
1,012.2
|
|
Trademarks
|
|
66.6
|
|
|
(40.2
|
)
|
|
26.4
|
|
|
65.3
|
|
|
(38.7
|
)
|
|
26.6
|
|
||||||
Licensing agreements
|
|
29.5
|
|
|
(23.6
|
)
|
|
5.9
|
|
|
33.5
|
|
|
(26.7
|
)
|
|
6.8
|
|
||||||
Customer relationships
|
|
1,022.1
|
|
|
(200.7
|
)
|
|
821.4
|
|
|
1,004.8
|
|
|
(181.2
|
)
|
|
823.6
|
|
||||||
Total definite-lived
|
|
$
|
2,321.7
|
|
|
$
|
(468.6
|
)
|
|
$
|
1,853.1
|
|
|
$
|
2,293.1
|
|
|
$
|
(423.9
|
)
|
|
$
|
1,869.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Indefinite-lived Trademarks and In-process R&D
|
|
$
|
1,102.0
|
|
|
$
|
—
|
|
|
$
|
1,102.0
|
|
|
$
|
1,088.4
|
|
|
$
|
—
|
|
|
$
|
1,088.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total identifiable intangible assets
|
|
$
|
3,423.7
|
|
|
$
|
(468.6
|
)
|
|
$
|
2,955.1
|
|
|
$
|
3,381.5
|
|
|
$
|
(423.9
|
)
|
|
$
|
2,957.6
|
|
•
|
For the three months ended March 31, 2017, the Company reported a sales increase of 16.6%, which primarily reflects the impact of consolidating two additional months of Sirona’s revenues in 2017 compared with 2016. For the three month period ended March 31, 2017, sales of our Combined Businesses declined 2.2% on a constant currency basis and internal growth was negative 4.7%, which was unfavorably impacted by approximately $40 million as a result of quarter-over-quarter net changes in equipment inventory levels at certain distributors in North America and Europe related to the transition in distribution strategy in North America (see “Business Drivers” under this section for further detail). Inventory held by these distributors increased during the first quarter of 2016 by approximately $27 million and decreased during the first quarter of 2017 by approximately $13 million.
|
•
|
On a geographic basis, the Combined Businesses generated constant currency sales growth of 5.3% in Europe, negative 2.4% in the Rest of World region and negative 10.0% in the United States for the three month period ended March 31, 2017.
|
•
|
First quarter 2017 earnings per diluted share of $0.26 declined 62.9% compared to $0.70 in the first quarter of 2016, which largely reflects the tax benefit recorded in the first quarter of 2016, the higher weighted average common shares outstanding in the first quarter of 2017 as a result of the Merger, lower sales and gross profit associated with quarter-over-quarter net equipment inventory changes at certain distributors, partially offset by the impact of consolidating two additional months of Sirona’s results. On an adjusted basis (a non-US GAAP measure), first quarter 2017 earnings per diluted share was $0.49 a decline from $0.69 in the first quarter of 2016.
|
•
|
During the quarter ended March 31, 2017, the Company repurchased approximately 1.4 million common shares for $84.6 million. Since the Merger in February 2016, the Company has deployed cash in excess of $1 billion as it returned cash to shareholders through common share repurchases and dividends, as well as strengthened the business through acquisitions.
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
March 31,
|
|
|
|||||||||||
(in millions)
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|||||||
Net sales
|
|
$
|
900.5
|
|
|
$
|
772.6
|
|
|
$
|
127.9
|
|
|
16.6
|
%
|
Less: precious metal content of sales
|
|
11.1
|
|
|
18.1
|
|
|
(7.0
|
)
|
|
(38.7
|
%)
|
|||
Net sales, excluding precious metal content
|
|
$
|
889.4
|
|
|
$
|
754.5
|
|
|
$
|
134.9
|
|
|
17.9
|
%
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
March 31,
|
|
|
|||||||||||
(in millions)
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|||||||
Net sales
|
|
$
|
900.5
|
|
|
$
|
772.6
|
|
|
$
|
127.9
|
|
|
16.6
|
%
|
Less: precious metal content of sales
|
|
11.1
|
|
|
18.1
|
|
|
(7.0
|
)
|
|
(38.7
|
%)
|
|||
Net sales, excluding precious metal content
|
|
889.4
|
|
|
754.5
|
|
|
134.9
|
|
|
17.9
|
%
|
|||
Sirona net sales
(a)
|
|
—
|
|
|
160.7
|
|
|
(160.7
|
)
|
|
NM
|
|
|||
Merger related adjustments
(b)
|
|
1.5
|
|
|
8.8
|
|
|
(7.3
|
)
|
|
NM
|
|
|||
Elimination of intercompany net sales
|
|
—
|
|
|
(0.4
|
)
|
|
0.4
|
|
|
NM
|
|
|||
Non-US GAAP combined business, net sales, excluding precious metal content
|
|
$
|
890.9
|
|
|
$
|
923.6
|
|
|
$
|
(32.7
|
)
|
|
(3.5
|
%)
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
March 31,
|
|
|
|
|
|||||||||
(in millions)
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|||||||
United States
|
|
$
|
312.1
|
|
|
$
|
278.4
|
|
|
$
|
33.7
|
|
|
12.1
|
%
|
|
|
|
|
|
|
|
|
|
|||||||
Europe
|
|
364.1
|
|
|
299.9
|
|
|
64.2
|
|
|
21.4
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Rest of World
|
|
213.2
|
|
|
176.2
|
|
|
37.0
|
|
|
21.0
|
%
|
|
|
Three Months Ended
|
||||||||||||||
|
|
March 31, 2017
|
||||||||||||||
(in millions)
|
|
United States
|
|
Europe
|
|
Rest of World
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Net sales
|
|
$
|
313.5
|
|
|
$
|
372.7
|
|
|
$
|
214.3
|
|
|
$
|
900.5
|
|
Less: precious metal content of sales
|
|
1.4
|
|
|
8.6
|
|
|
1.1
|
|
|
11.1
|
|
||||
Net sales, excluding precious metal content
|
|
312.1
|
|
|
364.1
|
|
|
213.2
|
|
|
889.4
|
|
||||
Merger related adjustments
(a)
|
|
1.5
|
|
|
—
|
|
|
—
|
|
|
1.5
|
|
||||
Non-US GAAP combined business, net sales, excluding precious metal content
|
|
$
|
313.6
|
|
|
$
|
364.1
|
|
|
$
|
213.2
|
|
|
$
|
890.9
|
|
|
|
Three Months Ended
|
||||||||||||||
|
|
March 31, 2016
|
||||||||||||||
(in millions)
|
|
United States
|
|
Europe
|
|
Rest of World
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Net sales
|
|
$
|
279.7
|
|
|
$
|
311.2
|
|
|
$
|
181.7
|
|
|
$
|
772.6
|
|
Less: precious metal content of sales
|
|
1.3
|
|
|
11.3
|
|
|
5.5
|
|
|
18.1
|
|
||||
Net sales, excluding precious metal content
|
|
278.4
|
|
|
299.9
|
|
|
176.2
|
|
|
754.5
|
|
||||
Sirona net sales
(a)
|
|
60.5
|
|
|
59.4
|
|
|
40.8
|
|
|
160.7
|
|
||||
Merger related adjustments
(b)
|
|
8.8
|
|
|
—
|
|
|
—
|
|
|
8.8
|
|
||||
Elimination of intercompany net sales
|
|
(0.1
|
)
|
|
(0.3
|
)
|
|
—
|
|
|
(0.4
|
)
|
||||
Non-US GAAP combined business, net sales, excluding precious metal content
|
|
$
|
347.6
|
|
|
$
|
359.0
|
|
|
$
|
217.0
|
|
|
$
|
923.6
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
March 31,
|
|
|
|
|
|||||||||
(in millions)
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|||||||
Gross profit
|
|
$
|
492.0
|
|
|
$
|
418.9
|
|
|
$
|
73.1
|
|
|
17.5
|
%
|
|
|
|
|
|
|
|
|
|
|||||||
Gross profit as a percentage of net sales, including precious metal content
|
|
54.6
|
%
|
|
54.2
|
%
|
|
|
|
|
|
|
|||
Gross profit as a percentage of net sales, excluding precious metal content
|
|
55.3
|
%
|
|
55.5
|
%
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
March 31,
|
|
|
|
|
|||||||||
(in millions)
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|||||||
Selling, general and administrative expenses (“SG&A”)
|
|
$
|
404.7
|
|
|
$
|
342.1
|
|
|
$
|
62.6
|
|
|
18.3
|
%
|
Restructuring and other costs
|
|
3.1
|
|
|
4.1
|
|
|
(1.0
|
)
|
|
(24.4
|
%)
|
|||
|
|
|
|
|
|
|
|
|
|||||||
SG&A as a percentage of net sales, including precious metal content
|
|
44.9
|
%
|
|
44.3
|
%
|
|
|
|
|
|
|
|||
SG&A as a percentage of net sales, excluding precious metal content
|
|
45.5
|
%
|
|
45.3
|
%
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||||
(in millions)
|
|
2017
|
|
2016
|
|
Change
|
||||||
|
|
|
|
|
|
|
||||||
Net interest expense
|
|
$
|
8.6
|
|
|
$
|
8.7
|
|
|
$
|
(0.1
|
)
|
Other expense (income), net
|
|
(1.0
|
)
|
|
(3.4
|
)
|
|
2.4
|
|
|||
Net interest and other expense
|
|
$
|
7.6
|
|
|
$
|
5.3
|
|
|
$
|
2.3
|
|
|
|
Three Months Ended March 31,
|
|
|
||||||||
(in millions, except per share data)
|
|
2017
|
|
2016
|
|
$ Change
|
||||||
|
|
|
|
|
|
|
||||||
Provision (benefit) for income taxes
|
|
$
|
16.9
|
|
|
$
|
(57.9
|
)
|
|
$
|
74.8
|
|
|
|
|
|
|
|
|
||||||
Effective income tax rate
|
|
22.1
|
%
|
|
NM
|
|
|
|
||||
|
|
|
|
|
|
|
||||||
Net income attributable to Dentsply Sirona
|
|
$
|
59.8
|
|
|
$
|
125.0
|
|
|
$
|
(65.2
|
)
|
|
|
|
|
|
|
|
||||||
Earnings per common share - diluted
|
|
$
|
0.26
|
|
|
$
|
0.70
|
|
|
|
|
|
|
Three Months Ended
|
|||||
|
|
March 31, 2017
|
|||||
(in millions)
|
|
Operating Income
|
|
Percentage of Net Sales, Excluding Precious Metal Content
|
|||
|
|
|
|
|
|||
Operating income attributable to Dentsply Sirona
|
|
$
|
84.2
|
|
|
9.5
|
%
|
Amortization of purchased intangible assets
|
|
45.3
|
|
|
5.1
|
%
|
|
Business combination related costs and fair value adjustments
|
|
10.6
|
|
|
1.2
|
%
|
|
Restructuring program related costs and other costs
|
|
5.2
|
|
|
0.5
|
%
|
|
Credit risk and fair value adjustments
|
|
2.6
|
|
|
0.3
|
%
|
|
Adjusted non-US GAAP Operating Income
|
|
$
|
147.9
|
|
|
16.6
|
%
|
|
|
Three Months Ended
|
|||||
|
|
March 31, 2016
|
|||||
(in millions)
|
|
Operating Income
|
|
Percentage of Net Sales, Excluding Precious Metal Content
|
|||
|
|
|
|
|
|||
Operating income attributable to Dentsply Sirona
|
|
$
|
72.7
|
|
|
9.6
|
%
|
Business combination related costs and fair value adjustments
|
|
68.8
|
|
|
9.0
|
%
|
|
Amortization of purchased intangible assets
|
|
21.8
|
|
|
2.9
|
%
|
|
Restructuring program related costs and other costs
|
|
4.9
|
|
|
0.6
|
%
|
|
Credit risk and fair value adjustments
|
|
1.3
|
|
|
0.1
|
%
|
|
Adjusted non-US GAAP Operating Income
|
|
$
|
169.5
|
|
|
22.2
|
%
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
March 31,
|
|
|
|||||||||||
(in millions)
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|||||||
Dental and Healthcare Consumables
|
|
$
|
500.2
|
|
|
$
|
470.9
|
|
|
$
|
29.3
|
|
|
6.2
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||
Technologies
|
|
389.2
|
|
|
283.6
|
|
|
105.6
|
|
|
37.2
|
%
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
March 31,
|
|
|
|||||||||||
(in millions)
|
|
2017
|
|
2016
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|||||||
Dental and Healthcare Consumables
|
|
$
|
136.5
|
|
|
$
|
130.8
|
|
|
$
|
5.7
|
|
|
4.4
|
%
|
|
|
|
|
|
|
|
|
|
|
||||||
Technologies
|
|
54.0
|
|
|
53.8
|
|
|
0.2
|
|
|
0.4
|
%
|
|
|
Three Months Ended
|
||||||||||
|
|
March 31, 2017
|
||||||||||
(in millions)
|
|
Dental and Healthcare Consumables
|
|
Technologies
|
|
Total
|
||||||
|
|
|
|
|
|
|
||||||
Net sales
|
|
$
|
511.2
|
|
|
$
|
389.3
|
|
|
$
|
900.5
|
|
Less: precious metal content of sales
|
|
11.0
|
|
|
0.1
|
|
|
11.1
|
|
|||
Net sales, excluding precious metal content
|
|
500.2
|
|
|
389.2
|
|
|
889.4
|
|
|||
Merger related adjustments
(a)
|
|
—
|
|
|
1.5
|
|
|
1.5
|
|
|||
Non-US GAAP combined business, net sales, excluding precious metal content
|
|
$
|
500.2
|
|
|
$
|
390.7
|
|
|
$
|
890.9
|
|
|
|
Three Months Ended
|
||||||||||
|
|
March 31, 2016
|
||||||||||
(in millions)
|
|
Dental and Healthcare Consumables
|
|
Technologies
|
|
Total
|
||||||
|
|
|
|
|
|
|
||||||
Net sales
|
|
$
|
488.8
|
|
|
$
|
283.8
|
|
|
$
|
772.6
|
|
Less: precious metal content of sales
|
|
17.9
|
|
|
0.2
|
|
|
18.1
|
|
|||
Net sales, excluding precious metal content
|
|
470.9
|
|
|
283.6
|
|
|
754.5
|
|
|||
Sirona net sales
(a)
|
|
15.7
|
|
|
145.0
|
|
|
160.7
|
|
|||
Merger related adjustments
(b)
|
|
—
|
|
|
8.8
|
|
|
8.8
|
|
|||
Elimination of intercompany net sales
|
|
(0.4
|
)
|
|
—
|
|
|
(0.4
|
)
|
|||
Non-US GAAP combined business, net sales, excluding precious metal content
|
|
$
|
486.2
|
|
|
$
|
437.4
|
|
|
$
|
923.6
|
|
(in millions, except per share amounts)
Period
|
|
Total Number
of Shares
Purchased
|
|
Average Price
Paid Per
Share
|
|
Total Cost
of Shares
Purchased
|
|
Number of
Shares that
May be Purchased
Under the Stock
Repurchase
Program
|
||||||
|
|
|
|
|
|
|
|
|
||||||
January 1, 2017 to January 31, 2017
|
|
0.5
|
|
|
$
|
56.41
|
|
|
$
|
27.3
|
|
|
4.2
|
|
February 1, 2017 to February 28, 2017
|
|
0.3
|
|
|
58.15
|
|
|
18.0
|
|
|
4.6
|
|
||
March 1, 2017 to March 31, 2017
|
|
0.6
|
|
|
62.94
|
|
|
39.3
|
|
|
4.4
|
|
||
|
|
1.4
|
|
|
$
|
59.67
|
|
|
$
|
84.6
|
|
|
|
|
Exhibit Number
|
|
Description
|
|
Section 302 Certification Statement Chief Executive Officer
|
|
|
Section 302 Certification Statement Chief Financial Officer
|
|
|
Section 906 Certification Statements
|
|
101.INS
|
|
XBRL Instance Document
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Extension Labels Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
/s/
|
Jeffrey T. Slovin
|
|
May 10, 2017
|
|
Jeffrey T. Slovin
|
|
Date
|
|
Chief Executive Officer
|
|
|
/s/
|
Ulrich Michel
|
|
May 10, 2017
|
|
Ulrich Michel
|
|
Date
|
|
Executive Vice President and
|
|
|
|
Chief Financial Officer
|
|
|
1 Year DENTSPLY SIRONA Chart |
1 Month DENTSPLY SIRONA Chart |
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