FILED BY BECTON, DICKINSON AND COMPANY
PURSUANT TO RULE 425 UNDER THE SECURITIES ACT OF 1933 AND
DEEMED FILED PURSUANT TO RULE 14A-12 OF THE SECURITIES EXCHANGE ACT OF 1934
SUBJECT COMPANY: CAREFUSION CORP
COMMISSION FILE NO. 333-199830
The following slides were used in a presentation made by Becton, Dickinson and Company at the 33rd Annual J. P. Morgan Healthcare Conference, held on January 14, 2015.
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33rd Annual J. P. Morgan Healthcare Conference
January 14, 2015
Vincent A. Forlenza
Chairman, Chief Executive Officer and President
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Forward-Looking Statements
These materials include forward-looking statements and it’s possible that actual results could differ from our
expectations. Factors that could cause such differences appear in our fourth quarter earnings release and in
our recent SEC filings.
Non-GAAP Financial Measures
These materials also include Non-GAAP financial measures. A reconciliation to the comparable GAAP
measures can be found in our fourth quarter 2014 earnings release, the financial schedules attached thereto
and the related earnings call slides, all of which are posted on the “Investors” section of the BD.com website.
FXN = Estimated foreign exchange-neutral currency growth.
$ = Dollars in millions except per share data.
Note: All figures on accompanying slides are rounded. Totals may not add due to rounding. Percentages are based on un-rounded figures.
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Topics for Discussion
Strategic Focus………………………………… 4
Financial Review and Outlook .……… 7
Growth Drivers……………………………….…………… 12
CareFusion Acquisition ……………………………………. 16
Summary……………………………………………………. 22
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Strategic Focus
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Building Off a Strong Core
Becoming a provider of complete
Today healthcare solutions
Moved into near adjacencies
Accelerated revenue growth
2013 to 2014 Delivered higher quality of earnings
New products as a percentage of sales increased from
8% to 15%
Built targeted M&A capabilities
2010 to 2012 Emerging market investments
Enhanced operational efficiencies
R&D spending reallocation
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Strategic Focus:
Sustainable, Profitable Growth
Strong Core Portfolio
Customer Regional Acquisitions &
Innovation
Centricity Investments Partnerships
Built on a Foundation of Ethics, Compliance and Shared Value
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Financial Review
and Outlook
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Our Strategy Delivered Results in FY2014
2014 Key Achievements:
Strong revenue growth of 5.2%
Launched an array of new products bringing new products as a percentage of sales to 15%
Emerging Market investments continue to fuel growth
Operating effectiveness and efficiency initiatives continued to drive underlying margin expansion
42nd consecutive year of dividend increases
Proactively adapting to the dynamic healthcare environment by transitioning to a customer-focused provider of healthcare solutions
Growth and Innovation Strategy Continues to Deliver Results
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Solid, Sustainable Revenue Growth
4.5% to 5.0%
6% 5.4% FXN*
5.2%
5% 1.2% 0.2%
4.3%
Growth 4% 1.1%
2.9%
3%
Revenue 4.2% 5.0% 4.5%-5.0%
2%
FXN 2.9% 3.2%
1%
0%
FY2011* FY2012 FY2013 FY2014 FY2015**
Growth from Acquisitions and One-Time Items
Organic Growth
Note: Amounts are restated for continuing operations and are foreign currency neutral (FXN). * FY2011 values are adjusting for the impact of
prior-year sales related to pandemic flu, stimulus spending in the U.S. and supplemental spending in Japan that occurred in fiscal year 2010.
**FY 2015 Guidance Estimate.
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Investments in the Business Drove Strong Financial P&L Performance in 2014
Revenue Growth Operating Income “Cash” EPS Growth
10.9%
5.2%
Key Drivers Key Drivers Key Drivers
Enhancing our core Fixed cost leverage: Solid revenues and Innovative new products service centers, end to end improved operating income process improvement Tax rate improvement Emerging market growth Supply chain efficiencies Share repurchases Safety-engineered product growth Manufacturing productivity
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Note: Figures represent fiscal year 2014 currency-neutral growth.
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Fiscal Year 2015 Outlook: Continue to Drive
Improved Growth Profile on the Top and Bottom Line
Revenue Growth Operating Income “Cash” EPS Growth*
9% to 10%*
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4.5% to 5.0%
Key Drivers Key Drivers Key Drivers
Enhancing our core Fixed cost leverage: Solid revenues and
Innovative new products service centers, end to end improved operating income
process improvement Tax rate improvement
Emerging market growth Supply chain efficiencies
Safety-engineered product
growth Manufacturing productivity
Note: Figures represent fiscal year foreign-currency neutral 2015 guidance estimates. * EPS values represent underlying improvements, inclusive
of approximately 1% of estimated impact from the cancellation of the share repurchase program.
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Growth Drivers
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BD Medical:
New Products and Innovation
Medical
$2.3B Surgical
Systems
$4.6B Diabetes
Revenue $1.0B Care
Pharmaceutical
$1.2B Systems
Note: Fiscal year 2014 revenues in billions. Totals may not add due to rounding.
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BD Life Sciences:
New Products and Innovation
$1.4B Preanalytical
Systems
$3.9B Diagnostic
Revenue $1.3B Systems
$1.2B Biosciences
Note: Fiscal year 2014 revenues in billions. Totals may not add due to rounding.
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Emerging Markets and Safety Continue
to Drive Significant Growth
Global Leader in Safety with a Robust Emerging Market Footprint
26%
Revenues from
needle-stick
safety products
18.6%
Growth in
emerging market
safety revenues
25.1%
Revenues from emerging
markets, including over
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billion BD EmeraldTM |
syringes sold
Note: Percentages based on fiscal year 2014 revenues.
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CareFusion Acquisition
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Compelling Strategic Transaction
Accelerates BD’s strategy to deliver complete solutions that meet evolving industry needs
Builds scale and depth to create unique growth opportunities, leveraging BD’s international footprint
Creates meaningful value for shareholders, customers and employees around the world
Leader in Medication Management and Patient Safety
$12 billion in combined annualized revenues
46,000 employees worldwide
Presence in almost every country in the world
Significantly increases BD’s addressable opportunity
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Complementary Product Portfolios
More than doubles BD Medical’s addressable opportunity from about $8B to $16B
Becomes a global leader in medication management, with a leading informatics platform across value chain
Prepare
Dispense Administer Monitor
Closed System Drug Transfer Device
Closed System Drug Transfer Device
Robotics
Workflow Automation
Automated Packaging
Outsourced Pharmacy Vendor
Drugs/IV Solutions
Bar Code Supported Medication Prep
Automated Med Dispensing Cabinets
Syringes
IV Sets/Connectors IV Catheters CVC/PICC
Flush
Skin Prep
Large Volume Pumps Syringe Pumps Ambulatory Pumps Regional Anesthesia
Bar Code Supported Medication Admin
Infection Surveillance
Medication Management Data Analytics
BD
CareFusion
BD+CareFusion
New/Small Position Leading Position Smart Solution
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BD in Canada
Established – 1951
1 plant
550 BD associates
BD in Western Europe
First location: France – 1952
Legal entities in 21 countries
10 plants
6,000 BD associates
BD in Japan
Established – 1971 1 plant 600 BD associates
BD in Asia Pacific
First location: Australia – 1971 Legal entities in 16 countries 5 plants 4,600 BD associates
BD in China
Established – 1994 2 plants 2,200 BD associates
BD in India
Established – 1995 1 plant 500 BD associates
BD in United States
Established: 1897
29 plants
12,000 BD associates
BD in Latin America
First location: Mexico –1952
Legal entities in 8 countries
5 plants
5,200 BD associates
Legal Entities
Plant locations
Corporate Office
Emerging Markets
BD in EMA
First location: Dubai, UAE – 1994 Legal entities in 10 countries No manufacturing 250 BD associates
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Acquisition Timeline
CareFusion Acquisition
Acquisition expected to close
Announced in the first quarter
10/5/14 of 2015
Expiration of Financing CareFusion European
the HSR Act shareholder vote, Approval
Waiting Period scheduled for
1/21/15
Integration Planning Progress:
3 Phases of Integration:
1. “Listen and Engage” First 30 days -Done
2. “Jointly Plan and Countdown to Close” 31 days to Close -In Process
3. “Transition to NewCo” Close to 2 years -In Process
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Awards and Recognitions
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Summary
Built a strong foundation for future growth
Delivered on our commitments in fiscal year 2014
BD together with CareFusion is a powerful combination that delivers value to customers
Looking to the future with confidence
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BD, BD Logo and all other trademarks are the property of Becton, Dickinson and Company.
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IMPORTANT INFORMATION FOR INVESTORS
In connection with the proposed transaction, BD will file with the SEC a registration statement on Form S-4 that will constitute a prospectus of BD and include a proxy statement of CareFusion. BD and CareFusion also plan to file other relevant documents with the SEC regarding the proposed transaction. INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS FILED WITH THE SEC IF AND WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. You may obtain a free copy of the proxy statement/prospectus (if and when it becomes available) and other relevant documents filed by BD and CareFusion with the SEC at the SEC’s website at www.sec.gov. In addition, you will be able to obtain free copies of these documents by phone, email or written request by contacting the investor relations department of BD or CareFusion at the following: Monique Dolecki, BD Investor Relations 201-847-5378 or Jim Mazzola, CareFusion Investor Relations 858-617-1203.
PARTICIPANTS IN THE SOLICITATION
BD and CareFusion and their respective directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction.
Information about BD’s directors and executive officers is available in BD’s proxy statement dated December 19, 2013, for its 2014 Annual Meeting of Shareholders and in its subsequent filings with the SEC. Information about CareFusion’s directors and executive officers is available in CareFusion’s proxy statement dated September 25, 2014, for its 2014 Annual Meeting of Stockholders. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the merger when they become available. Investors should read the proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from BD or CareFusion as indicated above. This slide presentation shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.
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This slide presentation contains certain estimates and other forward-looking statements (as defined under Federal securities laws). Forward looking statements generally are accompanied by words such as “will”, “expect”, “outlook” or other similar words, phrases or expressions. These forward-looking statements include statements regarding the estimated or anticipated future results of BD, and of the combined company following BD’s proposed acquisition of CareFusion, the anticipated benefits of the proposed combination, including estimated synergies, the expected timing of completion of the transaction and other statements that are not historical facts. These statements are based on the current expectations of BD and CareFusion management and are not predictions of actual performance. These statements are subject to a number of risks and uncertainties regarding BD and CareFusion’s respective businesses and the proposed acquisition, and actual results may differ materially. These risks and uncertainties include, but are not limited to, the ability of the parties to successfully close the proposed acquisition, including the risk that the required regulatory approvals are not obtained, are delayed or are subject to unanticipated conditions that could adversely affect the combined company or the expected benefits of the transaction; risks relating to the integration of CareFusion’s operations, products and employees into BD and the possibility that the anticipated synergies and other benefits of the proposed acquisition will not be realized or will not be realized within the expected timeframe; the outcome of any legal proceedings related to the proposed merger; access to available financing for the refinancing of BD’s or CareFusion’s debt on a timely basis and reasonable terms; the ability to market and sell CareFusion’s products in new markets, including the ability to obtain necessary regulatory product registrations and clearances; the loss of key senior management or other associates; the anticipated demand for BD’s and CareFusion’s products, including the risk of future reductions in government healthcare funding, changes in reimbursement rates or changes in healthcare practices that could result in lower utilization rates or pricing pressures; the impact of competition in the medical device industry; the risks of fluctuations in interest or foreign currency exchange rates; product liability claims; difficulties inherent in product development, including the timing or outcome of product development efforts, the ability to obtain regulatory approvals and clearances and the timing and market success of product launches; risks relating to fluctuations in the cost and availability of raw materials and other sourced products and the ability to maintain favorable supplier arrangements and relationships; successful compliance with governmental regulations applicable to BD, CareFusion and the combined company; changes in regional, national or foreign economic conditions; uncertainties of litigation, as well as other factors discussed in BD’s and CareFusion’s respective filings with the Securities Exchange Commission. BD and CareFusion do not intend to update any forward-looking statements to reflect events or circumstances after the date hereof, except as required by applicable laws or regulations.
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FORWARD-LOOKING STATEMENTS
This communication contains certain estimates and other forward-looking statements (as defined under Federal securities laws). Forward looking statements generally are accompanied by words such as “will”, “expect”, “outlook” or other similar words, phrases or expressions. These forward-looking statements include statements regarding the estimated or anticipated future results of BD, and of the combined company following BD’s proposed acquisition of CareFusion, the anticipated benefits of the proposed combination, including estimated synergies, the expected timing of completion of the transaction and other statements that are not historical facts. These statements are based on the current expectations of BD and CareFusion management and are not predictions of actual performance. These statements are subject to a number of risks and uncertainties regarding BD and CareFusion’s respective businesses and the proposed acquisition, and actual results may differ materially. These risks and uncertainties include, but are not limited to, the ability of the parties to successfully close the proposed acquisition, including the risk that the required regulatory approvals are not obtained, are delayed or are subject to unanticipated conditions that could adversely affect the combined company or the expected benefits of the transaction; risks relating to the integration of CareFusion’s operations, products and employees into BD and the possibility that the anticipated synergies and other benefits of the proposed acquisition will not be realized or will not be realized within the expected timeframe; the outcome of any legal proceedings related to the proposed merger; access to available financing for the refinancing of BD’s or CareFusion’s debt on a timely basis and reasonable terms; the ability to market and sell CareFusion’s products in new markets, including the ability to obtain necessary regulatory product registrations and clearances; the loss of key senior management or other associates; the anticipated demand for BD’s and CareFusion’s products, including the risk of future reductions in government healthcare funding, changes in reimbursement rates or changes in healthcare practices that could result in lower utilization rates or pricing pressures; the impact of competition in the medical device industry; the risks of fluctuations in interest or foreign currency exchange rates; product liability claims; difficulties inherent in product development, including the timing or outcome of product development efforts, the ability to obtain regulatory approvals and clearances and the timing and market success of product launches; risks relating
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to fluctuations in the cost and availability of raw materials and other sourced products and the ability to maintain favorable supplier arrangements and relationships; successful compliance with governmental regulations applicable to BD, CareFusion and the combined company; changes in regional, national or foreign economic conditions; uncertainties of litigation, as well as other factors discussed in BD’s and CareFusion’s respective filings with the Securities Exchange Commission (SEC). BD and CareFusion do not intend to update any forward-looking statements to reflect events or circumstances after the date hereof, except as required by applicable laws or regulations.
IMPORTANT INFORMATION FOR INVESTORS
In connection with the proposed transaction, BD filed with the SEC a registration statement on Form S-4 that included a preliminary prospectus of BD and that also constitutes a preliminary proxy statement of CareFusion. The registration statement has been declared effective by the SEC, and the definitive proxy statement/prospectus was delivered to stockholders of CareFusion on or about December 19, 2014. BD and CareFusion also plan to file other relevant documents with the SEC regarding the proposed transaction. INVESTORS ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT/PROSPECTUS (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS THERETO) AND OTHER DOCUMENTS RELATING TO THE MERGER THAT WILL BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. You may obtain a free copy of the registration statement and the definitive proxy statement/prospectus and other relevant documents filed by BD and CareFusion with the SEC at the SEC’s website at www.sec.gov. In addition, you will be able to obtain free copies of these documents by phone, e-mail or written request by contacting the investor relations department of BD or CareFusion at the following: Monique N. Dolecki, Investor Relations – 201-847-5378 Monique_Dolecki@bd.com or Jim Mazzola, Investor Relations – 858-617-1203 Jim.Mazzola@CareFusion.com
PARTICIPANTS IN THE SOLICITATION
BD and CareFusion and their respective directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information about BD’s directors and executive officers is available in BD’s proxy statement dated December 18, 2014, for its 2015 Annual Meeting of Shareholders and subsequent SEC filings. Information about CareFusion’s directors and executive officers is available in CareFusion’s proxy statement dated September 25, 2014, for its 2014 Annual Meeting of Stockholders. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the merger when they become available. Investors should read the proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from BD or CareFusion as indicated above. This communication shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.
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