X
|
QUARTERLY REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
__
|
TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Delaware
|
11-3136595
|
(State
or other jurisdiction of
|
(I.R.S.
Employer Identification No.)
|
incorporation
or organization)
|
Yes
X
|
No __
|
Yes
__
|
No __
|
Large
accelerated filer X
|
Accelerated
filer __
|
|
Non-accelerated
filer __
|
(Do
not check if a smaller reporting company)
|
Smaller
reporting company __
|
Yes
__
|
No X
|
Page
|
|||
PART
I. FINANCIAL INFORMATION
|
|||
ITEM
1.
|
Consolidated
Financial Statements:
|
||
3
|
|||
4
|
|||
5
|
|||
6
|
|||
7
|
|||
ITEM
2.
|
|||
21
|
|||
ITEM
3.
|
36
|
||
ITEM
4.
|
36
|
||
PART
II. OTHER INFORMATION
|
|||
ITEM
1.
|
37
|
||
ITEM
2.
|
37
|
||
ITEM
6.
|
38
|
||
38
|
CONSOLIDATED
BALANCE SHEETS
|
||||||||
(in
thousands, except share and per share data)
|
||||||||
September
26,
|
December
27,
|
|||||||
2009
|
2008
|
|||||||
(unaudited)
|
(Adjusted
- Notes 1 & 8)
|
|||||||
ASSETS
|
||||||||
Current
assets:
|
||||||||
Cash
and cash equivalents
|
$ | 317,607 | $ | 369,570 | ||||
Accounts
receivable, net of reserves of $47,890 and $42,855
|
764,285 | 734,027 | ||||||
Inventories,
net
|
770,370 | 731,654 | ||||||
Deferred
income taxes
|
40,747 | 36,974 | ||||||
Prepaid
expenses and other
|
186,744 | 193,841 | ||||||
Total
current assets
|
2,079,753 | 2,066,066 | ||||||
Property
and equipment, net
|
257,602 | 247,835 | ||||||
Goodwill
|
977,054 | 922,952 | ||||||
Other
intangibles, net
|
212,042 | 214,093 | ||||||
Investments
and other
|
176,888 | 148,264 | ||||||
Total
assets
|
$ | 3,703,339 | $ | 3,599,210 | ||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
Current
liabilities:
|
||||||||
Accounts
payable
|
$ | 507,462 | $ | 554,773 | ||||
Bank
credit lines
|
1,731 | 4,936 | ||||||
Current
maturities of long-term debt
|
23,933 | 156,405 | ||||||
Accrued
expenses:
|
||||||||
Payroll
and related
|
148,665 | 135,523 | ||||||
Taxes
|
83,951 | 69,792 | ||||||
Other
|
263,392 | 262,236 | ||||||
Total
current liabilities
|
1,029,134 | 1,183,665 | ||||||
Long-term
debt
|
242,511 | 256,648 | ||||||
Deferred
income taxes
|
107,953 | 95,399 | ||||||
Other
liabilities
|
72,038 | 58,109 | ||||||
Redeemable
noncontrolling interests
|
177,513 | 233,035 | ||||||
Commitments
and contingencies
|
||||||||
Stockholders'
equity:
|
||||||||
Preferred
stock, $.01 par value, 1,000,000 shares authorized,
|
||||||||
none
outstanding
|
- | - | ||||||
Common
stock, $.01 par value, 240,000,000 shares authorized,
|
||||||||
90,448,417
outstanding on September 26, 2009 and
|
||||||||
89,351,849
outstanding on December 27, 2008
|
904 | 894 | ||||||
Additional
paid-in capital
|
533,508 | 492,505 | ||||||
Retained
earnings
|
1,406,199 | 1,181,454 | ||||||
Accumulated
other comprehensive income
|
71,863 | 29,721 | ||||||
Total
Henry Schein, Inc. stockholders' equity
|
2,012,474 | 1,704,574 | ||||||
Noncontrolling
interests
|
61,716 | 67,780 | ||||||
Total
stockholders' equity
|
2,074,190 | 1,772,354 | ||||||
Total
liabilities and stockholders' equity
|
$ | 3,703,339 | $ | 3,599,210 |
CONSOLIDATED
STATEMENTS OF INCOME
|
||||||||||||||||
(in
thousands, except per share data)
|
||||||||||||||||
(unaudited)
|
||||||||||||||||
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
September
26,
|
September
27,
|
September
26,
|
September
27,
|
|||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
(Adjusted
- Notes 1, 4 & 8)
|
(Adjusted
- Note 4)
|
(Adjusted
- Notes 1, 4 & 8)
|
||||||||||||||
Net
sales
|
$ | 1,659,433 | $ | 1,644,209 | $ | 4,752,255 | $ | 4,799,234 | ||||||||
Cost
of sales
|
1,183,166 | 1,168,615 | 3,361,707 | 3,389,847 | ||||||||||||
Gross
profit
|
476,267 | 475,594 | 1,390,548 | 1,409,387 | ||||||||||||
Operating
expenses:
|
||||||||||||||||
Selling,
general and administrative
|
362,382 | 360,180 | 1,060,062 | 1,094,512 | ||||||||||||
Restructuring
costs
|
- | - | 4,043 | - | ||||||||||||
Operating
income
|
113,885 | 115,414 | 326,443 | 314,875 | ||||||||||||
Other
income (expense):
|
||||||||||||||||
Interest
income
|
2,387 | 4,260 | 7,674 | 12,217 | ||||||||||||
Interest
expense
|
(5,171 | ) | (9,240 | ) | (18,329 | ) | (26,816 | ) | ||||||||
Other,
net
|
1,938 | (4,863 | ) | 1,595 | (5,524 | ) | ||||||||||
Income
from continuing operations before
|
||||||||||||||||
taxes,
equity in earnings of affiliates and
|
||||||||||||||||
noncontrolling
interests
|
113,039 | 105,571 | 317,383 | 294,752 | ||||||||||||
Income
taxes
|
(15,864 | ) | (34,355 | ) | (83,402 | ) | (98,787 | ) | ||||||||
Equity
in earnings of affiliates
|
1,200 | 1,602 | 3,777 | 4,020 | ||||||||||||
Income
from continuing operations
|
98,375 | 72,818 | 237,758 | 199,985 | ||||||||||||
Income
(loss) from discontinued operations, net of tax
|
2,373 | (52 | ) | 2,715 | (828 | ) | ||||||||||
Net
income
|
100,748 | 72,766 | 240,473 | 199,157 | ||||||||||||
Less:
Net income attributable to noncontrolling interests
|
(4,327 | ) | (5,278 | ) | (15,728 | ) | (15,659 | ) | ||||||||
Net
income attributable to Henry Schein, Inc.
|
$ | 96,421 | $ | 67,488 | $ | 224,745 | $ | 183,498 | ||||||||
Amounts
attributable to Henry Schein, Inc.:
|
||||||||||||||||
Income
from continuing operations
|
$ | 94,045 | $ | 67,548 | $ | 222,143 | $ | 184,239 | ||||||||
Income
(loss) from discontinued operations, net of tax
|
2,376 | (60 | ) | 2,602 | (741 | ) | ||||||||||
Net
income
|
$ | 96,421 | $ | 67,488 | $ | 224,745 | $ | 183,498 | ||||||||
Earnings
per share attributable to Henry Schein, Inc.:
|
||||||||||||||||
From
continuing operations:
|
||||||||||||||||
Basic
|
$ | 1.06 | $ | 0.76 | $ | 2.50 | $ | 2.07 | ||||||||
Diluted
|
$ | 1.03 | $ | 0.74 | $ | 2.45 | $ | 2.00 | ||||||||
From
discontinued operations:
|
||||||||||||||||
Basic
|
$ | 0.03 | $ | 0.00 | $ | 0.03 | $ | (0.01 | ) | |||||||
Diluted
|
$ | 0.02 | $ | 0.00 | $ | 0.03 | $ | 0.00 | ||||||||
From
net income:
|
||||||||||||||||
Basic
|
$ | 1.09 | $ | 0.76 | $ | 2.53 | $ | 2.06 | ||||||||
Diluted
|
$ | 1.05 | $ | 0.74 | $ | 2.48 | $ | 2.00 | ||||||||
Weighted-average
common shares outstanding:
|
||||||||||||||||
Basic
|
88,796 | 88,930 | 88,843 | 89,216 | ||||||||||||
Diluted
|
91,513 | 91,376 | 90,576 | 91,908 |
CONSOLIDATED
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
|
||||||||||||||||||||||||||||
(in
thousands, except share data)
|
||||||||||||||||||||||||||||
(unaudited)
|
||||||||||||||||||||||||||||
Common
Stock
$.01
Par Value
|
Additional
Paid-in
Capital
|
Retained
Earnings
|
Accumulated
Comprehensive Income
|
Noncontrolling
Interests
|
Total
Stockholders'
Equity
|
|||||||||||||||||||||||
Shares
|
Amount
|
|||||||||||||||||||||||||||
Balance,
December 27, 2008 - as previously reported
|
89,351,849 | $ | 894 | $ | 705,799 | $ | 1,195,771 | $ | 29,721 | $ | - | $ | 1,932,185 | |||||||||||||||
Cumulative
impact of adopting ASC Topic 470-20
|
- | - | 19,741 | (14,317 | ) | - | - | 5,424 | ||||||||||||||||||||
Cumulative
impact of adopting ASC Topic 810-10-65
|
- | - | - | - | - | 67,780 | 67,780 | |||||||||||||||||||||
Cumulative
impact of adopting ASC Topic 480-10
|
- | - | (233,035 | ) | - | - | - | (233,035 | ) | |||||||||||||||||||
Balance,
December 27, 2008 - as adjusted
|
89,351,849 | $ | 894 | $ | 492,505 | $ | 1,181,454 | $ | 29,721 | $ | 67,780 | $ | 1,772,354 | |||||||||||||||
Net
income
|
- | - | - | 224,745 | - | 15,728 | 240,473 | |||||||||||||||||||||
Foreign
currency translation gain
|
- | - | - | - | 29,060 | 4,180 | 33,240 | |||||||||||||||||||||
Unrealized
gain from foreign currency hedging activities,
|
||||||||||||||||||||||||||||
net
of tax of $7,774
|
- | - | - | - | 14,029 | - | 14,029 | |||||||||||||||||||||
Unrealized
investment gain, net of tax of $42
|
- | - | - | - | 13 | - | 13 | |||||||||||||||||||||
Pension
adjustment loss, net of tax of $120
|
- | - | - | - | (960 | ) | - | (960 | ) | |||||||||||||||||||
Total
comprehensive income
|
19,908 | 286,795 | ||||||||||||||||||||||||||
Dividends
paid
|
- | - | - | - | - | (2,382 | ) | (2,382 | ) | |||||||||||||||||||
Noncontrolling
interest of acquired companies
|
- | - | (47,533 | ) | - | - | (23,590 | ) | (71,123 | ) | ||||||||||||||||||
Decrease
in redeemable noncontrolling interests
|
- | - | 55,522 | - | - | - | 55,522 | |||||||||||||||||||||
Shares
issued to 401(k) plan
|
100,778 | 1 | 5,300 | - | - | - | 5,301 | |||||||||||||||||||||
Shares
issued upon exercise of stock options,
|
||||||||||||||||||||||||||||
including
tax benefit of $1,635
|
311,491 | 3 | 11,321 | - | - | - | 11,324 | |||||||||||||||||||||
Stock-based
compensation expense
|
751,560 | 7 | 18,337 | - | - | - | 18,344 | |||||||||||||||||||||
Shares
withheld for payroll taxes
|
(67,261 | ) | (1 | ) | (2,028 | ) | - | - | - | (2,029 | ) | |||||||||||||||||
Liability
for cash settlement stock option awards and other
|
- | - | 84 | - | - | - | 84 | |||||||||||||||||||||
Balance,
September 26, 2009
|
90,448,417 | $ | 904 | $ | 533,508 | $ | 1,406,199 | $ | 71,863 | $ | 61,716 | $ | 2,074,190 |
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
||||||||
(in
thousands)
|
||||||||
(unaudited)
|
||||||||
Nine
Months Ended
|
||||||||
September
26,
|
September
27,
|
|||||||
2009
|
2008
|
|||||||
(Adjusted
- Notes 1 & 8)
|
||||||||
Cash
flows from operating activities:
|
||||||||
Net
income
|
$ | 240,473 | $ | 199,157 | ||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||
Gain
on sale of discontinued operation, net of tax
|
(2,382 | ) | - | |||||
Depreciation
and amortization
|
60,930 | 59,183 | ||||||
Amortization
of bond discount
|
4,473 | 4,214 | ||||||
Stock-based
compensation expense
|
18,344 | 23,060 | ||||||
Provision
for losses on trade and other accounts receivable
|
2,754 | 3,711 | ||||||
Benefit
from deferred income taxes
|
(29,633 | ) | (2,705 | ) | ||||
Stock
issued to 401(k) plan
|
5,301 | 4,662 | ||||||
Undistributed
earnings of affiliates
|
(3,777 | ) | (4,020 | ) | ||||
Other
|
2,535 | (2,132 | ) | |||||
Changes
in operating assets and liabilities, net of acquisitions:
|
||||||||
Accounts
receivable
|
(12,788 | ) | (66,751 | ) | ||||
Inventories
|
(10,234 | ) | (68,182 | ) | ||||
Other
current assets
|
(806 | ) | (3,460 | ) | ||||
Accounts
payable and accrued expenses
|
(56,813 | ) | 41,927 | |||||
Net
cash provided by operating activities
|
218,377 | 188,664 | ||||||
Cash
flows from investing activities:
|
||||||||
Purchases
of fixed assets
|
(38,417 | ) | (38,119 | ) | ||||
Payments
for equity investment and business
|
||||||||
acquisitions,
net of cash acquired
|
(97,911 | ) | (25,930 | ) | ||||
Cash
received from business divestitures
|
12,716 | - | ||||||
Purchases
of available-for-sale securities
|
- | (35,925 | ) | |||||
Proceeds
from sales of available-for-sale securities
|
8,730 | 1,572 | ||||||
Net
proceeds from foreign exchange forward contract
settlements
|
275 | 9,090 | ||||||
Other
|
(11,258 | ) | 3,607 | |||||
Net
cash used in investing activities
|
(125,865 | ) | (85,705 | ) | ||||
Cash
flows from financing activities:
|
||||||||
Repayments
of bank borrowings
|
(3,829 | ) | (5,786 | ) | ||||
Principal
payments for long-term debt
|
(153,452 | ) | (30,139 | ) | ||||
Proceeds
from issuance of stock upon exercise of stock options
|
9,689 | 25,041 | ||||||
Payments
for repurchases of common stock
|
- | (54,945 | ) | |||||
Excess
tax benefits related to stock-based compensation
|
2,821 | 10,635 | ||||||
Other
|
(2,127 | ) | (1,856 | ) | ||||
Net
cash used in financing activities
|
(146,898 | ) | (57,050 | ) | ||||
Net
change in cash and cash equivalents
|
(54,386 | ) | 45,909 | |||||
Effect
of exchange rate changes on cash and cash equivalents
|
2,423 | (5,135 | ) | |||||
Cash
and cash equivalents, beginning of period
|
369,570 | 247,590 | ||||||
Cash
and cash equivalents, end of period
|
$ | 317,607 | $ | 288,364 |
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
September
26,
|
September
27,
|
September
26,
|
September
27,
|
|||||||||||||
2009
|
2008
(1)
|
2009
(1)
|
2008
(1)
|
|||||||||||||
Net
Sales:
|
||||||||||||||||
Healthcare
distribution (2):
|
||||||||||||||||
Dental
(3)
|
$ | 622,065 | $ | 641,487 | $ | 1,838,240 | $ | 1,905,206 | ||||||||
Medical
(4)
|
410,617 | 423,675 | 1,088,875 | 1,080,084 | ||||||||||||
International
(5)
|
583,540 | 538,033 | 1,699,053 | 1,693,017 | ||||||||||||
Total
healthcare distribution
|
1,616,222 | 1,603,195 | 4,626,168 | 4,678,307 | ||||||||||||
Technology
(6)
|
43,211 | 41,014 | 126,087 | 120,927 | ||||||||||||
Total
|
$ | 1,659,433 | $ | 1,644,209 | $ | 4,752,255 | $ | 4,799,234 | ||||||||
(1)
|
Adjusted
to reflect the effects of discontinued
operations.
|
(2)
|
Consists
of consumable products, small equipment, laboratory products, large dental
and medical equipment, equipment repair services, branded and generic
pharmaceuticals, vaccines, surgical products, diagnostic tests,
infection-control products and
vitamins.
|
(3)
|
Consists
of products sold in the United States and
Canada.
|
(4)
|
Consists
of products sold in the United States’ medical and animal health
markets.
|
(5)
|
Consists
of products sold in the dental, medical and animal health markets,
primarily in Europe.
|
(6)
|
Consists
of practice management software and other value-added products and
services, which are distributed primarily to healthcare providers in the
United States, Canada, the United Kingdom, Australia and New
Zealand.
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
September
26,
|
September
27,
|
September
26,
|
September
27,
|
|||||||||||||
2009
|
2008
(1)
|
2009
(1)
|
2008
(1)
|
|||||||||||||
Operating
Income:
|
||||||||||||||||
Healthcare
distribution
|
$ | 98,250 | $ | 100,887 | $ | 280,618 | $ | 272,952 | ||||||||
Technology
|
15,635 | 14,527 | 45,825 | 41,923 | ||||||||||||
Total
|
$ | 113,885 | $ | 115,414 | $ | 326,443 | $ | 314,875 | ||||||||
(1)
|
Adjusted
to reflect the effects of discontinued
operations.
|
2009
|
2008
|
||
Expected
dividend yield
|
0%
|
0%
|
|
Expected
stock price volatility
|
28%
|
20%
|
|
Risk-free
interest rate
|
1.88%
|
2.75%
|
|
Expected
life of options (years)
|
4.5
|
4.5
|
Shares
|
Weighted
Average
Exercise
Price
|
Weighted
Average Remaining Contractual Life in Years
|
Aggregate
Intrinsic
Value
|
||||||||||||
Outstanding
at beginning of period
|
6,791,828 | $ | 39.85 | ||||||||||||
Granted
|
42,206 | 38.33 | |||||||||||||
Exercised
|
(311,491 | ) | 31.11 | ||||||||||||
Forfeited
|
(90,427 | ) | 48.53 | ||||||||||||
Outstanding
at end of period
|
6,432,116 | $ | 40.16 | 5.6 | $ | 99,208 | |||||||||
Options
exercisable at end of period
|
4,957,845 | $ | 35.76 | 4.9 | $ | 95,507 |
Time-Based
Restricted Stock/Units
|
||||||||||
Shares/Units
|
Weighted
Average
Grant
Date Fair Value
|
Aggregate
Intrinsic
Value
|
||||||||
Outstanding
at beginning of period
|
285,225 | $ | 14,771 | |||||||
Granted
|
344,036 | 12,013 | ||||||||
Vested
|
(1,315 | ) | (49 | ) | ||||||
Forfeited
|
(22,783 | ) | (1,100 | ) | ||||||
Outstanding
at end of period
|
605,163 | $ | 25,635 | $ |
33,139
|
Performance-Based
Restricted Stock/Units
|
||||||||||
Shares/Units
|
Weighted
Average
Grant
Date Fair Value
|
Aggregate
Intrinsic
Value
|
||||||||
Outstanding
at beginning of period
|
347,141 | $ | 17,704 | |||||||
Granted
|
780,289 | 12,110 | ||||||||
Vested
|
(179,719 | ) | (8,503 | ) | ||||||
Forfeited
|
(7,980 | ) | (372 | ) | ||||||
Outstanding
at end of period
|
939,731 | $ | 20,939 | $ |
51,460
|
Three
Months Ended
|
Nine
Months Ended
|
||||||
September
26,
|
September
27,
|
September
26,
|
September
27,
|
||||
2009
|
2008
|
2009
|
2008
|
||||
Basic
|
88,796,152
|
88,929,672
|
88,843,067
|
89,216,159
|
|||
Effect
of dilutive securities:
|
|||||||
Stock
options, restricted stock and restricted units
|
2,241,503
|
1,579,672
|
1,732,922
|
1,760,015
|
|||
Effect
of assumed conversion of convertible debt
|
475,081
|
866,457
|
-
|
932,091
|
|||
Diluted
|
91,512,736
|
91,375,801
|
90,575,989
|
91,908,265
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
September
26,
|
September
27,
|
September
26,
|
September
27,
|
|||||||||||||
2009
|
2008
(1) (2)
|
2009
(1)
|
2008
(1) (2)
|
|||||||||||||
Comprehensive
income
|
$ | 130,098 | $ | 17,938 | $ | 286,795 | $ | 175,892 | ||||||||
Comprehensive
income attributable to
|
||||||||||||||||
Henry
Schein, Inc.
|
122,706 | 15,836 | 266,887 | 161,024 | ||||||||||||
Comprehensive
income attributable to
|
||||||||||||||||
noncontrolling
interests
|
7,392 | 2,102 | 19,908 | 14,868 | ||||||||||||
(1) Adjusted
to reflect the effects of discontinued
operations.
|
(2) Adjusted
to reflect the effects of the adoption of provisions contained within ASC
Topic 470-20, “Debt with Conversion and Other
Options.”
|
•
|
Level
1— Unadjusted quoted prices in active markets for identical assets or
liabilities that are accessible at the measurement
date.
|
•
|
Level
2— Inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly or
indirectly. Level 2 inputs include quoted prices for similar
assets or liabilities in active markets; quoted prices for identical or
similar assets or liabilities in markets that are not active; inputs other
than quoted prices that are observable for the asset or liability; and
inputs that are derived principally from or corroborated by observable
market data by correlation or other
means.
|
•
|
Level
3— Inputs that are unobservable for the asset or
liability.
|
Level
1
|
Level
2
|
Level
3
|
Total
|
|||||||||||||
Assets:
|
||||||||||||||||
Auction-rate
securities
|
$ | - | $ | - | $ | 20,353 | $ | 20,353 | ||||||||
Money
market fund
|
- | - | 2,234 | 2,234 | ||||||||||||
Derivative
contracts
|
- | 3,773 | - | 3,773 | ||||||||||||
Total
assets
|
$ | - | $ | 3,773 | $ | 22,587 | $ | 26,360 | ||||||||
Liabilities:
|
||||||||||||||||
Derivative
contracts
|
$ | - | $ | 7,416 | $ | - | $ | 7,416 | ||||||||
Total
liabilities
|
$ | - | $ | 7,416 | $ | - | $ | 7,416 |
Level
3 (Unobservable Inputs)
|
||||
Closed-End
Municipal Bond Fund and
|
||||
Student
Loan Backed
|
||||
Auction-Rate
Securities
|
||||
and
Money Market Fund
|
||||
Balance,
December 27, 2008
|
$ | 33,546 | ||
Transfers
to Level 3
|
- | |||
Redemptions
(at par)
|
(11,514 | ) | ||
Gains
and (losses):
|
||||
Reported
in earnings - Reserve Primary Fund reserve reduction
|
500 | |||
Reported
in accumulated other comprehensive income
|
55 | |||
Balance,
September 26, 2009
|
$ | 22,587 |
Nine
Months Ended
|
||||||||
September
26,
|
September
27,
|
|||||||
2009
|
2008
|
|||||||
Interest
|
$ | 20,892 | $ | 28,513 | ||||
Income
taxes
|
114,176 | 77,516 |
Balance
at
December
27, 2008
|
Provision
|
Payments
and
Other
Adjustments
|
Balance
at
September
26, 2009
|
|||||||||||||
Severance
costs (1)
|
$ | 14,330 | $ | 2,451 | $ | (12,289 | ) | $ | 4,492 | |||||||
Facility
closing costs (2)
|
3,688 | 1,531 | (2,933 | ) | 2,286 | |||||||||||
Other
professional and consulting costs
|
519 | 61 | (379 | ) | 201 | |||||||||||
Total
|
$ | 18,537 | $ | 4,043 | $ | (15,601 | ) | $ | 6,979 | |||||||
(1)
|
Represents
salaries and related benefits for employees separated from the
Company.
|
(2)
|
Represents
costs associated with the closing of certain smaller facilities (primarily
lease termination costs) and property and equipment
write-offs.
|
Balance
at
December
27, 2008
|
Provision
|
Payments
and
Other
Adjustments
|
Balance
at
September
26, 2009
|
|||||||||||||
Healthcare
distribution
|
$ | 18,457 | $ | 4,043 | $ | (15,592 | ) | $ | 6,908 | |||||||
Technology
|
80 | - | (9 | ) | 71 | |||||||||||
Total
|
$ | 18,537 | $ | 4,043 | $ | (15,601 | ) | $ | 6,979 |
Asset
Derivatives
|
Liability
Derivatives
|
|||||||||
September
26, 2009
|
September
26, 2009
|
|||||||||
Balance
Sheet Location
|
Fair
Value
|
Balance
Sheet Location
|
Fair
Value
|
|||||||
Derivatives
designated as
|
||||||||||
hedging
instruments under
|
||||||||||
ASC
Topic 815-10:
|
||||||||||
Interest
rate contracts
|
Prepaid
expenses and other
|
$ | 568 |
Accrued
expenses other
|
$ | - | ||||
Foreign
exchange contracts
|
Prepaid
expenses and other
|
1,789 |
Accrued
expenses other
|
4,260 | ||||||
Total
|
2,357 | 4,260 | ||||||||
Derivatives
not designated as
|
||||||||||
hedging
instruments under
|
||||||||||
ASC
Topic 815-10:
|
||||||||||
Foreign
exchange contracts
|
Prepaid
expenses and other
|
1,416 |
Accrued
expenses other
|
3,156 | ||||||
Total
derivatives
|
$ | 3,773 | $ | 7,416 |
Gain
(Loss) Reclassified from
AOCI
into Income (Effective
Portion)
|
Amount
of Forward Points
Recognized
in Income on
Derivative
(Ineffective Portion)
|
||||||||||||||||
Location
of Gain
(Loss)
Reclassified
from
AOCI into
Income
(Effective
Portion)
|
Three
Months Ended September 26, 2009
|
Nine
Months Ended September 26, 2009
|
Location
where
Forward
Points are
Recognized
in Income
on
Derivative
(Ineffective
Portion)
|
Three
Months Ended September 26, 2009
|
Nine
Months Ended September 26, 2009
|
||||||||||||
Other,
net
|
$ | (2,262 | ) | $ | (370 | ) |
Interest
income
|
$ | 123 | $ | 140 | ||||||
Cost
of sales
|
4,069 | 4,279 |
Other,
net
|
(1 | ) | (15 | ) |
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
September
26,
|
September
27,
|
September
26,
|
September
27,
|
|||||||||||||
2009
|
2008
(1) (2)
|
2009
(1)
|
2008
(1) (2)
|
|||||||||||||
Operating
results:
|
||||||||||||||||
Net
sales
|
$ | 1,659,433 | $ | 1,644,209 | $ | 4,752,255 | $ | 4,799,234 | ||||||||
Cost
of sales
|
1,183,166 | 1,168,615 | 3,361,707 | 3,389,847 | ||||||||||||
Gross
profit
|
476,267 | 475,594 | 1,390,548 | 1,409,387 | ||||||||||||
Operating
expenses:
|
||||||||||||||||
Selling,
general and administrative
|
362,382 | 360,180 | 1,060,062 | 1,094,512 | ||||||||||||
Restructuring
costs
|
- | - | 4,043 | - | ||||||||||||
Operating
income
|
$ | 113,885 | $ | 115,414 | $ | 326,443 | $ | 314,875 | ||||||||
Other
expense, net
|
$ | (846 | ) | $ | (9,843 | ) | $ | (9,060 | ) | $ | (20,123 | ) | ||||
Income
from continuing operations
|
98,375 | 72,818 | 237,758 | 199,985 | ||||||||||||
Income
from continuing operations attributable
|
||||||||||||||||
to
Henry Schein, Inc.
|
96,421 | 67,488 | 224,745 | 183,498 | ||||||||||||
Cash
flows:
|
||||||||||||||||
Net
cash provided by operating activities
|
$ | 218,377 | $ | 188,664 | ||||||||||||
Net
cash used in investing activities
|
(125,865 | ) | (85,705 | ) | ||||||||||||
Net
cash used in financing activities
|
(146,898 | ) | (57,050 | ) | ||||||||||||
(1)
|
Adjusted
to reflect the effects of discontinued
operations.
|
(2)
|
Adjusted
to reflect the effects of the adoption of provisions contained within ASC
Topic 470-20, “Debt with Conversion and Other
Options.”
|
September
26,
|
%
of
|
September
27,
|
%
of
|
Increase
/ (Decrease)
|
||||||||||||||||||||
2009
|
Total
|
2008
(1)
|
Total
|
$ | % | |||||||||||||||||||
Healthcare
distribution (2):
|
||||||||||||||||||||||||
Dental
(3)
|
$ | 622,065 | 37.5 | % | $ | 641,487 | 39.0 | % | $ | (19,422 | ) | (3.0 | )% | |||||||||||
Medical
(4)
|
410,617 | 24.7 | 423,675 | 25.8 | (13,058 | ) | (3.1 | ) | ||||||||||||||||
International
(5)
|
583,540 | 35.2 | 538,033 | 32.7 | 45,507 | 8.5 | ||||||||||||||||||
Total
healthcare distribution
|
1,616,222 | 97.4 | 1,603,195 | 97.5 | 13,027 | 0.8 | ||||||||||||||||||
Technology
(6)
|
43,211 | 2.6 | 41,014 |