14 August 2023

---

Henry Schein reports solid Q2 2023 financial results

---

Henry Schein, Inc. reported financial results on Aug. 7 for the second quarter which ended July 1, 2023. 

In a news release, Stanley M. Bergman, chairman of the board and CEO of Henry Schein, said that the company's solid results were driven by North America dental businesses with strong equipment and steady general merchandise sales, and continuing strength in sales of technology and value-added services, implants, biomaterials and endodontic products.

"Demand for dental services and customer confidence continue to improve, as evidenced by the ongoing investments our customers are making in their practices,” he said. “Our outlook reflects overall confidence in our business and in the markets we serve.” 

Bergman said that the company is successfully executing key initiatives, including expanding specialty products and value-added services portfolios, optimizing distribution businesses, leveraging key customer relationships and driving digital transformation.

"Year to date, we have committed over $1 billion to acquisitions that accelerate the implementation of our strategic plan, adding high-growth, high-margin products and services to our offering," he said. "With this clear focus, we believe we are well-positioned to further enhance Henry Schein’s leadership in the markets that we serve and to deliver long-term sustainable shareholder value.” 

Second-quarter financial results 

• Total net sales for the quarter were $3.1 billion, an increase of 2.3% compared with the second quarter of 2022. The 2.3% increase included a 0.2% decrease in local currencies excluding acquisitions, 2.9% growth from acquisitions, and a 0.4% decrease related to foreign currency exchange1. Sales of PPE products and COVID-19 test kits in the quarter were $163 million, a decrease of $96 million versus the prior-year period. When excluding sales of PPE products and COVID-19 test kits, second-quarter internal sales growth in local currencies was 3.3% compared with the prior-year period.
• GAAP net income for the quarter was $140 million, or $1.06 per diluted share, compared with second-quarter 2022 GAAP net income of $160 million, or $1.16 per diluted share.
• Non-GAAP net income for the quarter was $173 million, or $1.31 per diluted share, compared with second-quarter 2022 non-GAAP net income of $179 million, or $1.30 per diluted share2,4 and excludes restructuring expenses of $18 million, or $0.10 per diluted share, and amortization expense of acquired intangible assets of $34 million, or $0.15 per diluted share.
• Global Dental sales were $2.0 billion for the quarter, an increase of 5.6% compared with the prior-year period, driven by the North America dental businesses, reflecting increasing patient traffic, and dental practitioners’ continued investment in technology and equipment. Internally generated sales increased 2.0% in local currencies and acquisitions contributed 4.2% growth. This growth was offset by a 0.6% decrease related to foreign currency exchange1. The 2.0% internal sales increase in local currencies reflects a 2.1% increase in North America and 1.8% growth internationally.
• Global Medical sales were $1.0 billion for the quarter, a decrease of 4.6% compared with the prior-year period. Internally generated sales decreased 5.3% in local currencies, acquisitions contributed 0.8% growth, and foreign currency exchange resulted in a decrease of 0.1%1. Internal sales increased 2.0% in local currencies when excluding sales of PPE products and COVID-19 test kits and were impacted by lower flu cases versus the prior year which resulted in lower point-of-care diagnostic test and related product sales.
• Global Technology and Value-Added Services sales were $193 million for the quarter, an increase of 6.7% compared with the prior-year period, driven by the strength of Henry Schein One. This included 5.5% internal sales growth in local currencies and 1.5% growth from acquisitions, offset by a 0.3% decrease related to foreign currency exchange1. Growth continued to be driven by Dentrix Ascend and Dentally cloud-based solutions, and by revenue cycle management solutions driven by a higher volume of e-claims.