Latest news with #BryanHanson
Yahoo
16 hours ago
- Business
- Yahoo
SOLV Q1 Earnings Call: Margin Headwinds Offset by Volume Growth and Product Momentum
Healthcare solutions provider Solventum (NYSE:SOLV) reported Q1 CY2025 results exceeding the market's revenue expectations , with sales up 2.7% year on year to $2.07 billion. Its non-GAAP profit of $1.34 per share was 9.7% above analysts' consensus estimates. Is now the time to buy SOLV? Find out in our full research report (it's free). Revenue: $2.07 billion vs analyst estimates of $2.01 billion (2.7% year-on-year growth, 2.7% beat) Adjusted EPS: $1.34 vs analyst estimates of $1.22 (9.7% beat) Management reiterated its full-year Adjusted EPS guidance of $5.55 at the midpoint Operating Margin: 7.3%, down from 18.9% in the same quarter last year Organic Revenue rose 4.3% year on year (0.9% in the same quarter last year) Market Capitalization: $12.96 billion Solventum's first quarter results reflected a turnaround in underlying business momentum, underpinned by four consecutive quarters of positive volume growth and expanding adoption of new products. CEO Bryan Hanson credited these improvements to a retooled commercial organization and foundational enhancements in talent, product innovation, and operational alignment. Hanson highlighted the accelerating traction in the MedSurg segment, with the V.A.C Peel and Place dressing and IV site management efforts gaining ground, and noted that advanced wound care, dental solutions, and revenue cycle management software all contributed positively. While the company benefited from favorable order timing related to ERP and distribution center transitions, management emphasized that normalized organic growth was still well above last year's levels, signaling progress after years of volume declines. Looking ahead, Solventum's leadership underscored tariff-related cost pressures as the primary risk to margin performance for the rest of the year. CFO Wayde McMillan explained that mitigation efforts—ranging from supply chain optimizations to securing regional exemptions—are intended to largely offset these headwinds within the company's full-year earnings guidance. Management is focused on sustaining volume-driven growth through continued commercial execution and product launches, particularly in growth driver areas like negative pressure wound therapy and dental innovation. However, Hanson cautioned that operating margins would likely land at the lower end of the company's planned range as tariff impacts are fully realized in the second half, stating, 'We expect that pressure to be in the second half. If you're just doing it mathematically, for us to end up at the lower end of our guidance range, that would mean the second half of the year would have to be below 20%.' Management attributed the quarter's performance to commercial execution, new product launches, and proactive supply chain adjustments, while emphasizing tariff headwinds and the importance of sustaining operational gains. Commercial execution improvements: CEO Bryan Hanson highlighted that the primary driver of growth was the company's restructured commercial organization, which enabled dedicated sales teams to focus on priority growth areas like MedSurg and Dental Solutions. Management credited these organizational changes with accelerating volume growth across all segments. Product innovation traction: Recent launches, including the V.A.C Peel and Place dressing for negative pressure wound therapy and Filtek Easy Match in Dental, received positive market response. The company also pointed to its 3D-printed Clarity Precision Grip Attachments and Clinpro Clear Fluoride Treatment as products gaining momentum, helping offset declines in lower-growth segments. Order timing and supply chain strategy: The quarter benefited from customers buying ahead of upcoming ERP system cutovers and distribution center transitions, as well as from SKU rationalization initiatives. Management noted that these timing benefits would reverse in subsequent quarters, but analytics with distributors confirmed underlying volume growth was still robust. Tariff headwinds and mitigation: Tariffs are expected to pressure margins in the second half of the year, but management has implemented short-term mitigation actions such as seeking trade exemptions, optimizing sourcing, and selectively adjusting pricing. Wayde McMillan emphasized rapid inventory turns and regional supply chain flexibility as key tools for managing this impact. Progress on business transformation and separation: Solventum is advancing its three-phase transformation plan, with milestones in global ERP deployments, transition service agreement exits, and ongoing business separation. The pending divestiture of the Purification & Filtration segment remains on track, and management reiterated its commitment to executing tuck-in acquisitions post-close. Solventum expects future performance to be shaped by the interplay of volume-driven growth, ongoing product launches, and margin pressures from tariffs and operational investments. Volume-driven growth as a priority: Management reiterated that sustainable growth will come from increasing sales volumes, especially through commercial focus, recent leadership changes, and expanding product portfolios. The company is prioritizing segments where new products have shown strong adoption, such as MedSurg and Dental Solutions, and expects this to support market share gains. Tariff and margin pressures: Tariffs on exports to China and the European Union are expected to reduce margins in the second half of the year. Management's mitigation strategy includes seeking regional trade exemptions, optimizing inventory and sourcing, and considering selective price adjustments. However, CFO Wayde McMillan cautioned that annualizing the current year's tariff impact is difficult due to evolving trade policy and ongoing mitigation efforts. Operational investments and transformation: Continued investments in ERP upgrades, supply chain modernization, and the phased business separation are designed to support long-term profitability and efficiency. The company views these initiatives as essential for maintaining momentum, even though they entail near-term costs and operational complexity. In the coming quarters, the StockStory team will be watching (1) whether Solventum can sustain positive volume growth as order timing effects normalize; (2) the extent to which margin pressures from tariffs are offset by operational improvements and mitigation efforts; and (3) continued adoption of recent product launches in MedSurg and Dental. Progress on the separation of the Purification & Filtration segment and the successful execution of ERP upgrades will also be key milestones. Solventum currently trades at a forward P/E ratio of 13.2×. At this valuation, is it a buy or sell post earnings? See for yourself in our full research report (it's free). Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
Yahoo
6 days ago
- Business
- Yahoo
Q1 Rundown: Solventum (NYSE:SOLV) Vs Other Surgical Equipment & Consumables
Earnings results often indicate what direction a company will take in the months ahead. With Q1 behind us, let's have a look at Solventum (NYSE:SOLV) and its peers. The surgical equipment and consumables industry provides tools, devices, and disposable products essential for surgeries and medical procedures. These companies therefore benefit from relatively consistent demand, driven by the ongoing need for medical interventions, recurring revenue from consumables, and long-term contracts with hospitals and healthcare providers. However, the high costs of R&D and regulatory compliance, coupled with intense competition and pricing pressures from cost-conscious customers, can constrain profitability. Over the next few years, tailwinds include aging populations, which tend to need surgical interventions at higher rates. The increasing integration of AI and robotics into surgical procedures could also create opportunities for differentiation and innovation. However, the industry faces headwinds including potential supply chain vulnerabilities, evolving regulatory requirements, and more widespread efforts to make healthcare less costly. The 5 surgical equipment & consumables - diversified stocks we track reported a satisfactory Q1. As a group, revenues beat analysts' consensus estimates by 1%. In light of this news, share prices of the companies have held steady as they are up 1.6% on average since the latest earnings results. Founded in 1985, Solventum (NYSE:SOLV) develops, manufactures, and commercializes a portfolio of healthcare products and services addressing critical customer and therapeutic patient needs. Solventum reported revenues of $2.07 billion, up 2.7% year on year. This print exceeded analysts' expectations by 2.7%. Overall, it was a very strong quarter for the company with a solid beat of analysts' organic revenue estimates and a decent beat of analysts' EPS estimates. "Our first quarter fiscal year 2025 results reflect solid revenue growth across our business and the positive progress we're making as part of our 3-phased transformation," said Bryan Hanson, chief executive officer of Solventum. Solventum achieved the biggest analyst estimates beat of the whole group. The stock is up 12.6% since reporting and currently trades at $75.14. Is now the time to buy Solventum? Access our full analysis of the earnings results here, it's free. With over five decades of experience in surgical innovation since its founding in 1970, CONMED (NYSE:CNMD) develops and manufactures medical devices and equipment for surgical procedures, specializing in orthopedic and general surgery products. CONMED reported revenues of $321.3 million, up 2.9% year on year, outperforming analysts' expectations by 2.6%. The business had a very strong quarter with an impressive beat of analysts' full-year EPS guidance estimates and a solid beat of analysts' EPS estimates. CONMED pulled off the highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 15.4% since reporting. It currently trades at $56.57. Is now the time to buy CONMED? Access our full analysis of the earnings results here, it's free. With a history dating back to 1897 and a presence in virtually every hospital around the globe, Becton Dickinson (NYSE:BDX) develops and manufactures medical supplies, devices, laboratory equipment and diagnostic products used by healthcare institutions and professionals worldwide. BD reported revenues of $5.27 billion, up 4.5% year on year, falling short of analysts' expectations by 1.5%. It was a slower quarter as it posted a miss of analysts' constant currency revenue estimates and a slight miss of analysts' full-year EPS guidance estimates. BD delivered the fastest revenue growth but had the weakest performance against analyst estimates and weakest full-year guidance update in the group. As expected, the stock is down 16.4% since the results and currently trades at $173. Read our full analysis of BD's results here. With a mission critical role in preventing healthcare-associated infections, STERIS (NYSE:STE) provides infection prevention products, sterilization services, and medical equipment that help healthcare facilities and life science companies maintain sterile environments. STERIS reported revenues of $1.48 billion, up 4.3% year on year. This print was in line with analysts' expectations. Overall, it was a strong quarter as it also recorded a narrow beat of analysts' full-year EPS guidance estimates and a decent beat of analysts' EPS estimates. The stock is up 6.6% since reporting and currently trades at $242.10. Read our full, actionable report on STERIS here, it's free. With a history dating back to 1927 and a presence in over 100 countries worldwide, Zimmer Biomet (NYSE:ZBH) designs and manufactures orthopedic products including knee and hip replacements, surgical tools, and robotic technologies for joint reconstruction and spine surgeries. Zimmer Biomet reported revenues of $1.91 billion, up 1.1% year on year. This number beat analysts' expectations by 0.7%. Aside from that, it was a slower quarter as it recorded a miss of analysts' full-year EPS guidance estimates. Zimmer Biomet had the slowest revenue growth among its peers. The stock is down 10.1% since reporting and currently trades at $91.99. Read our full, actionable report on Zimmer Biomet here, it's free. The Fed's interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump's presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025. Want to invest in winners with rock-solid fundamentals? Check out our Top 6 Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
Yahoo
09-05-2025
- Business
- Yahoo
Solventum Reports First Quarter 2025 Financial Results
Reported sales increased 2.6%; organic sales increased 4.3% Increases full year organic sales growth outlook by 50 bps to +1.5% to +2.5% ST. PAUL, Minn., May 8, 2025 /PRNewswire/ -- Solventum (NYSE: SOLV) today reported financial results for the first quarter ended March 31, 2025. First Quarter 2025 Highlights Sales increased 2.6% to $2.1 billion; up 4.3% on an organic basis GAAP diluted earnings per share of $0.78; adjusted diluted earnings per share of $1.34 Operating cash flow of $29 million; free cash flow of $(80) million "Our first quarter fiscal year 2025 results reflect solid revenue growth across our business and the positive progress we're making as part of our 3-phased transformation," said Bryan Hanson, chief executive officer of Solventum. "During the quarter, we introduced our long-term strategic plan, and we're focused on executing that strategy to drive sustainable growth and value creation while navigating through evolving macro trends and other short-term pressures." First Quarter 2025 Financial ResultsThree months ended March 31, (Dollars in millions, except per share amounts) 20252024Year over yearchange Net sales $ 2,070$ 2,0162.6 % Selling, general and administrative expenses $ 769$ 59629.0 % Research and development expenses $ 193$ 195(1.0) % Operating income margin 7.3 %18.9 %(1,160) bps Adjusted operating income margin1 19.7 %24.0 %(430) bps Net income $ 137$ 237(42.2) % Diluted earnings per share $ 0.78$ 1.37(43.1) % Adjusted diluted earnings per share1 $ 1.34$ 2.08(35.6) % Net cash provided by operating activities $ 29$ 442(93.4) % Free cash flow1 $ (80)$ 340(123.5) % Organic sales growth in the quarter reflect positive performance from all segments, primarily driven by the MedSurg and HIS segments. GAAP and adjusted operating income margin declined due to lower gross margins, including the impact from 3M supply agreement mark-up, and an increase in operating expenses related to public company stand-up costs and growth investments. 1 Represents non-GAAP financial measure; see the "Non-GAAP Financial Measures" section for applicable information. Segment and Total Company Net Sales for First Quarter* Three months ended March 31,Increase/(Decrease) (Dollars in millions)20252024Reported GrowthCurrency ImpactConstant Currency2Other3Organic Growth Advanced Wound Care$ 448$ 4411.5 %(1.2) %2.7 %(0.2) %2.8 % Infection Prevention andSurgical Solutions7106784.7(2.0)6.7(1.5)8.2 MedSurg1,1571,1193.4(1.6)5.0(1.0)6.0 Dental Solutions328335(2.1)(1.9)(0.2)(0.6)0.4 Health Information Systems3293173.6(0.3)3.8—3.9 Purification and Filtration242245(0.9)(2.0)1.1(1.1)2.2 Corporate and Unallocated413—NMNMNMNMNM Total Company$ 2,070$ 2,0162.6 %(1.6) %4.2 %(0.1) %4.3 %*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. 2 Constant currency represents the change in net sales absent the impact on sales from foreign currency translation. 3 Other represents sales impact from acquisitions and divestitures measured separately for the first 12 months post-transaction. Acquisitions include non-healthcare related supply agreements that conveyed from 3M to the Company at Spin-Off and sales from new supply agreements with 3M that commenced at Spin-Off. Divestiture impacts include certain health care businesses retained by 3M India in connection with the Spin-Off. 4 Corporate and unallocated includes sales related to product supplied to 3M and other supply agreements related to legacy 3M business and assumed by the company at Spin-Off. Full-Year 2025 GuidanceSolventum is updating its full year 2025 guidance to reflect underlying business performance and flexibility to navigate the dynamic macroeconomic environment as follows: Increased Organic sales growth range to +1.5% to +2.5% (+2.0% to +3.0% excluding ~50 bps of SKU exit impact) from prior range of +1.0% to +2.0% Adjusted EPS in the range of $5.45 to $5.65; no change Free cash flow in the range of $450M to $550M; no change Note: Full year 2025 guidance currently includes our Purification & Filtration segment. On February 25, 2025, we announced the sale of our Purification & Filtration segment. We will update our annual guidance for related impacts after the transaction closes. Organic sales, adjusted diluted EPS and free cash flow amounts included in Solventum's full-year guidance are non-GAAP financial measures. Solventum does not provide reconciliations of the forward-looking non-GAAP financial measures to the respective GAAP metrics as it is unable to predict with reasonable certainty and without unreasonable effort certain items, such as the impact of changes in currency exchange rates, impacts associated with business acquisitions or divestitures, and the timing and magnitude of restructuring activities, among other items. Please note Solventum's Q1 2024 results were reported on a carve-out basis. See the "Non-GAAP Financial Measures" section for explanations of our non-GAAP financial measures. Earnings Conference CallSolventum will host a conference call today, May 8, at 4:30 p.m. Eastern Time to discuss its first quarter financial results and provide an update on its business. The conference call can be accessed via audio webcast at or by dialing (800) 715-9871 within the U.S. or +1 (646) 307-1963 for international callers, using the conference ID 6342275. A replay of the webcast, along with the earnings press release, slides highlighting the results, and supplemental financial disclosures, will also be available at the same link on the Investor Relations section of the company's website. Forward Looking StatementsThis news release contains forward-looking information about Solventum's financial results and estimates and business prospects, including guidance for 2025, that contain or incorporate by reference statements that relate to future events and expectations and, as such, constitute forward-looking statements that involve risk and uncertainties. Forward-looking statements include those containing such words as "anticipates," "believes," "could," "estimates," "expects," "forecasts," "goal," "guidance," "intends," "may," "outlook," "plans," "projects," "seeks," "sees," "should," "targets," "will," "would," or other words of similar meaning in connection with any discussion of future operating or financial performance or business plans or prospects. Among the factors that could cause actual results to differ materially from those described in our forward looking statements are the following: (1) the effects of, and changes in, worldwide economic, political, regulatory, international, trade and geopolitical conditions, natural disasters, war, public health crises, and other events beyond Solventum's control; (2) operational execution risks; (3) damage to Solventum's reputation or its brands; (4) risks from acquisitions, strategic alliances, divestitures and other strategic events, including the divestiture of our Purification and Filtration business; (5) Solventum's business dealings involving third-party partners in various markets; (6) Solventum's ability to access the capital and credit markets and changes in Solventum's credit ratings; (7) exposure to interest rate and currency risks; (8) the highly competitive environment in which Solventum operates and consolidation in the healthcare industry; (9) reduction in customers' research budgets or government funding; (10) the timing and market acceptance of Solventum's new product and service offerings; (11) ongoing working relationships with certain key healthcare professionals; (12) changes in reimbursement practices of governments or private payers or other cost containment measures; (13) Solventum's ability to obtain components or raw materials supplied by third parties and other manufacturing and related supply chain difficulties, interruptions, and disruptive factors; (14) legal and regulatory proceedings and legal compliance risks (including third-party risks) with regards to antitrust, FCPA and other anti-bribery laws, environmental laws, anti-kickback and false claims laws, privacy laws, product liability claims, tax laws, and other laws and regulations in the United States and other countries in which Solventum operates; (15) potential liabilities related to per-and polyfluoroalkyl substances, collectively known as "PFAS"; (16) risks related to the highly regulated environment in which Solventum operates; (17) risks associated with product liability claims; (18) climate change and measures to address climate change; (19) security breaches and other disruptions to information technology infrastructure; (20) Solventum's failure to obtain, maintain, protect, or effectively enforce its intellectual property rights; (21) pension and postretirement obligation liabilities; (22) any failure by 3M Company ("3M") to perform any of its obligations under the various separation agreements entered into in connection with the separation of Solventum from 3M and distribution (the "Spin-Off"); (23) any failure to realize the expected benefits of the Spin-Off; (24) a determination by the IRS or other tax authorities that the Separation or certain related transactions should be treated as taxable transactions; (25) indebtedness incurred in the financing transactions undertaken in connection with the Separation and risks associated with additional indebtedness; (26) the risk that incremental costs of operating on a standalone basis (including the loss of synergies), costs of restructuring transactions and other costs incurred in connection with the Spin-Off will exceed Solventum's estimates; and (27) the impact of the Spin-Off on Solventum's businesses and the risk that the separation from 3M may be more difficult, time-consuming or costly than expected, including the impact on Solventum's resources, systems, procedures and controls, diversion of management's attention and the impact on relationships with customers, suppliers, employees and other business counterparties. The above list is not exhaustive or necessarily set forth in the order of importance. Forward-looking statements are based on certain assumptions and expectations of future events and trends, and actual future results and trends may differ materially from historical results or those reflected in any such forward-looking statements depending on a variety of factors. A further description of these factors is located under "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors" in Solventum's periodic reports on file with the U.S. Securities & Exchange Commission. Solventum assumes no obligation to update any forward-looking statements discussed herein as a result of new information or future events or developments. Non-GAAP Financial MeasuresIn addition to reporting financial results in accordance with U.S. GAAP, Solventum also provides non-GAAP measures that we use, and plan to continue using, when monitoring and evaluating operating performance and measuring cash available to invest in our business. The adjusted measures are not in accordance with, nor are they a substitute for, GAAP measures. These non-GAAP financial measures are supplemental measures of our performance and our liquidity that we believe help investors understand our underlying business performance and Solventum uses these measures as an indication of the strength of Solventum and its ability to generate cash. Solventum calculates forward-looking non-GAAP financial measures, including organic sales growth, adjusted operating income, adjusted operating income margin, adjusted effective tax rate, adjusted diluted earnings per share, and free cash flow based on internal forecasts that omit certain amounts that would be included in GAAP financial measures. Solventum does not provide reconciliations of these forward-looking non-GAAP financial measures to the respective GAAP metrics as it is unable to predict with reasonable certainty and without unreasonable effort certain items such as the impact of changes in currency exchange rates, impacts associated with business acquisitions or divestitures, and the timing and magnitude of restructuring activities, among other items. The timing and amounts of these items are uncertain and could have a material impact on Solventum's results in accordance with GAAP. The Q1 2025 financial statements and financial information, including reconciliations of non-GAAP financial measures, are available on Solventum's website: About Solventum At Solventum, we enable better, smarter, safer healthcare to improve lives. As a new company with a long legacy of creating breakthrough solutions for our customers' toughest challenges, we pioneer game-changing innovations at the intersection of health, material and data science that change patients' lives for the better — while empowering healthcare professionals to perform at their best. See how at Solventum Corporation CONDENSED CONSOLIDATED STATEMENTS OF INCOME* (Dollars in millions, except per-share data) (Unaudited)Three months ended March 31, 20252024 Net sales of product$ 1,597$ 1,553 Net sales of software and rentals473463 Total net sales2,0702,016 Cost of product835725 Cost of software and rentals121119 Gross profit1,1141,172 Selling, general and administrative expenses769596 Research and development expenses193195 Operating income152381 Interest expense, net10439 Other expense (income), net1113 Income before income taxes38329 Provision for (benefit from) income taxes(99)92 Net Income$ 137$ 237Earnings per share: Basic earnings per share$ 0.79$ 1.37 Diluted earnings per share0.781.37 Weighted-average number of share outstanding: Basic173.7172.7 Diluted174.8172.7*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. Solventum Corporation CONDENSED CONSOLIDATED BALANCE SHEETS* (Dollars in millions, except per-share data) (Unaudited)March 31,December 31, 20252024 Assets Current assets Cash and cash equivalents$ 534$ 762 Accounts receivable — net of allowances of $83 and $869261,044 Due from related parties185185 Inventories Finished goods484539 Work in process171190 Raw materials and supplies211236 Total inventories866965 Other current assets249293 Current assets held for sale293— Total current assets3,0533,249 Property, plant and equipment — net1,1981,622 Goodwill4,9916,377 Intangible assets — net2,3652,544 Other assets814665 Non-current assets held for sale2,106— Total assets$ 14,527$ 14,457 Liabilities Current liabilities Short-term borrowings and current portion of long-term debt$ 100$ 200 Accounts payable604618 Due to related parties356272 Unearned revenue558572 Other current liabilities8911,041 Current liabilities held for sale57— Total current liabilities2,5662,703 Long-term debt7,8137,810 Pension and postretirement benefits334350 Deferred income taxes226225 Other liabilities279410 Non-current liabilities held for sale47— Total liabilities$ 11,265$ 11,498Equity Common stock par value, $0.01 par value, 750,000,000 shares authorized$ 2$ 2 Shares issued and outstanding - March 31, 2025: 173,008,211 Shares issued and outstanding - December 31, 2024: 172,785,606 Additional paid-in capital3,7813,771 Retained earnings378242 Accumulated other comprehensive income (loss)(899)(1,056) Total equity3,2622,959 Total liabilities and equity$ 14,527$ 14,457*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. Solventum Corporation CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS* (Dollars in millions) (Unaudited)Three months ended March 31, (Millions)20252024 Cash Flows from Operating Activities Net income$ 137$ 237 Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization129139 Postretirement benefit plan expense159 Stock-based compensation expense494 Gain on business divestitures—— Deferred income taxes(144)(25) Changes in assets and liabilities Accounts receivable678 Due from related parties5— Inventories(32)(52) Accounts payable9115 Due to related parties(6)— Accrued compensation(95)(46) All other operating activities(44)(17) Net cash provided by operating activities29442Cash Flows from Investing Activities Purchases of property, plant and equipment(109)(102) Other — net(5)— Net cash used in investing activities(114)(102)Cash Flows from Financing Activities Repayment of debt(100)— Net transfers to 3M(31)(7,851) Proceeds from long-term debt, net of issuance costs—8,303 Other — net(8)10 Net cash (used in) provided by financing activities(139)462Effect of exchange rate changes on cash and cash equivalents1—Net increase (decrease) in cash and cash equivalents(223)802 Cash and cash equivalents at beginning of period762194 Less: Cash and cash equivalents within held for sale(5)— Cash and cash equivalents at end of period$ 534$ 996*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. Solventum Corporation and Subsidiaries*BUSINESS SEGMENTS(Unaudited) The Company's operating activities are managed through four operating segments: MedSurg, Dental Solutions, Health Information Systems, and Purification and Filtration. MedSurg provides: advanced wound care products such as negative pressure wound therapy, advanced wound dressings and advanced skin care; and infection prevention and surgical solutions products, such as I.V. site management, sterilization assurance, temperature management, surgical supplies, medical tapes and wraps, stethoscopes, medical electrodes, and medical technologies Original Equipment Manufacturer ("OEM"). Dental Solutions provides dental and orthodontic products, including brackets, aligners, restorative cements, and bonding agents that span the "life of the tooth," including products designed for preventative dental care, direct and indirect restoration, and broad orthodontic needs. Health Information Systems provides healthcare systems with software solutions – including computer-assisted physician documentation, direct-to-bill and coding automation, classification methodologies, speech recognition, and data visualization platforms. Purification and Filtration includes filters and membranes for biopharmaceutical and medical technologies, microelectronics and food and beverage, as well as filtration for cleaner drinking water. BUSINESS SEGMENT INFORMATION AND DISAGGREGATED NET SALES Three months ended March 31, 2025Three months ended March 31, 2024(Dollars in millions)Net SalesOperating IncomeOperating Margin %Net SalesOperating IncomeOperating Margin % Advanced Wound Care$ 448$ 441 Infection Prevention and Surgical Solutions710678 MedSurg1,157$ 20617.8 %1,119$ 22119.7 % Dental Solutions3287823.933511032.8 Health Information Systems32910933.131710131.9 Purification and Filtration2423514.52453915.9 Total business segment operating income$ 428$ 471 Corporate and Unallocated: Amortization expense$ (81)$ (87) Other Corporate and Unallocated(195)(3) Total Corporate and Unallocated13(276)——(90)— Total Company$ 2,070$ 1527.3 %$ 2,016$ 38118.9 %*Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. Solventum CorporationSUPPLEMENTAL FINANCIAL INFORMATIONNON-GAAP MEASURES(Unaudited) In addition to reporting financial results in accordance with U.S. GAAP, the company use non-GAAP financial measures to supplement the financial measures prepared in accordance with U.S. GAAP. These include (1) adjusted operating income and adjusted operating income margin, (2) adjusted diluted earnings per share, and (3) free cash flow. Management believes that these non-GAAP financial measures are useful in evaluating current performance and focusing management on our underlying operational results. There are limitations to the use of the non-GAAP financial measures presented in this information statement. These non-GAAP financial measures are not prepared in accordance with U.S. GAAP nor do they have any standardized meaning under U.S. GAAP. In addition, other companies may use similarly titled non-GAAP financial measures that are calculated differently from the way we calculate such measures. Accordingly, our non-GAAP financial measures may not be comparable to such similarly titled non-GAAP financial measures used by other companies. Management cautions you not to place undue reliance on these non-GAAP financial measures, but instead to consider them with the most directly comparable U.S. GAAP measure. These non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation. These non-GAAP financial measures should be considered supplements to, not substitutes for, or superior to, the corresponding financial measures calculated in accordance with U.S. GAAP. The tables below reconcile our non-GAAP financial measures to the nearest financial measure that is in accordance with U.S. GAAP for the periods presented. Adjusted Operating Income, Adjusted Operating Income Margin and Adjusted Earnings Per Share (Non-GAAP measures) Adjusted operating income and adjusted operating income margin are not defined under U.S. GAAP. Therefore, they should not be considered a substitute for earnings data prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. Solventum defines adjusted operating income as operating income excluding the effects of amortization, restructuring costs, Spin-Off and separation-related costs, certain litigation-related costs, and impacts related to the sale of the Purification and Filtration business. Adjusted operating income margin is adjusted operating income divided by the U.S GAAP measure total net sales for the same period. The company believes adjusted operating income and adjusted operating income margin provide investors with visibility into the company's unleveraged, pre-tax operating results and reflects underlying financial performance. However, adjusted operating income should not be construed as inferring that the company's future results will be unaffected by the items for which the measure adjusts. Adjusted diluted earnings per share is not defined under U.S. GAAP. Therefore, it should not be considered a substitute for earnings data prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. Solventum defines adjusted diluted earnings per share as net income excluding the after-tax effects of amortization, restructuring costs, Spin-Off and separation-related costs, certain litigation-related costs, and impacts related to the sale of the Purification and Filtration business and legal entity restructuring costs. The company believes adjusted earnings per share provides investors with improved comparability of underlying operating results and a further understanding and additional transparency regarding how the company evaluates the business. However, adjusted earnings per share should not be construed as inferring that the company's future results will be unaffected by the items for which the measure adjusts. Solventum Corporation SUPPLEMENTAL FINANCIAL INFORMATION NON-GAAP MEASURES – (CONTINUED)* (Unaudited)Three months ended March 31, 2025 (Dollars in millions, except per share amounts)Net salesCost of Sales5Gross Margin %Operating Expenses6Operating IncomeOperating Income Margin %Non-Operating Expense (Income), net7IncomeBefore Income TaxesNet Income Attributable to SolventumDiluted EPSEffectiveTax Rate GAAP$ 2,070$ 95653.8 %$ 962$ 1527.3 %$ 115$ 38$ 137$ 0.78(262.1) % Non-GAAP Adjustments: Amortization of acquisition-related intangible assets———(81)813.9—81680.39 Restructuring costs (a)—(10)0.5(8)180.9—18140.08 Spin-off and separation-related costs (b)—(27)1.3(94)1215.8—121930.53 Certain litigation-related costs (d)———(19)190.9—19140.08 Sale of Purification and Filtration-related (e)———(16)160.8—16(92)(0.53) Non-GAAP$ 2,070$ 91955.6 %$ 744$ 40719.7 %$ 115$ 293$ 234$ 1.3419.9 %Three months ended March 31, 2024 (Dollars in millions, except per share amounts)Net salesCost of Sales5Gross Margin %OperatingExpenses6Operating IncomeOperating Income Margin %Non-Operating Expense (Income), net7Income Before IncomeTaxesNet Income Attributable to SolventumDilutedEPSEffectiveTax Rate GAAP$ 2,016$ 84458.1 %$ 791$ 38118.9 %$ 52$ 329$ 237$ 1.3728.0 % Non-GAAP Adjustments: Amortization of acquisition-related intangible assets——(87)874.3—87730.42 Restructuring costs (a)—(1)0.1(8)90.5—960.04 Spin-off and separation-related costs (b)——(7)70.3(12)19160.09 Legal entity restructuring (c)————270.16 Non-GAAP$ 2,016$ 84358.2 %$ 689$ 48424.0 %$ 40$ 444$ 359$ 2.0819.1 % __________ *Data in the schedule above is intentionally rounded to the nearest million and, therefore, may not sum. (a) Severance, asset write-offs and related charges associated with certain restructuring programs. (b) Consists of costs specifically incurred in connection with the Company's separation from 3M. (c) Reflects the tax impacts for legal entity restructuring in connection with the separation from 3M. (d) Consists of charges and recoveries related to certain litigation matters. (e) Costs related to and tax impacts from the sale of the Company's Purification and Filtration business.5 Cost of sales is the combination of cost of product and cost of software and rentals line items from the Consolidated Statements of Income and represents the total company cost of sales. 6 Operating expenses is the combination of selling, general and administrative expenses and research and development expenses from the Consolidated Statements of Income and represents the total company other operating expenses. 7 Non-operating expense (income), net is the combination of interest expense, net and other expense (income), net line items from the Consolidated Statements of Income and represents the total company non-operating expense. Solventum CorporationSUPPLEMENTAL FINANCIAL INFORMATIONNON-GAAP MEASURES – (CONTINUED)*(Unaudited) Free Cash Flow (non-GAAP measure): Free cash flow is not defined under U.S. GAAP. Therefore, it should not be considered a substitute for income or cash flow data prepared in accordance with U.S. GAAP and may not be comparable to similarly titled measures used by other companies. The company defines free cash flow as net cash provided by operating activities less purchases of property, plant and equipment. It should not be inferred that the entire free cash flow amount is available for discretionary expenditures. The company believes free cash flow is meaningful to investors as it is a useful measure of liquidity and the company uses these measures as an indication of the strength of the company and its ability to generate cash. Free cash flow varies across quarters throughout the year. Below find a recap of free cash flow. (Dollars in millions)Three months ended March 31, Major GAAP Cash Flow Categories20252024 Net cash provided by operating activities$ 29$ 442 Net cash (used in) investing activities(114)(102) Net cash (used in) provided by financing activities(139)462Free Cash Flow (non-GAAP measure) Net cash provided by operating activities$ 29$ 442 Purchases of property, plant and equipment(109)(102) Free cash flow(80)340 View original content to download multimedia: SOURCE Solventum Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
22-03-2025
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From the Archives: March 22 in the Pioneer
Mar. 22—March 22, 2015 — As the local ACT on Alzheimer's initiative moves into the action phase of its work, local team members will host a community meeting to generate support and ideas for implementation. ACT on Alzheimer's estimates 88,000 Minnesotans 65 and older have Alzheimer's, and that number is growing. March 22, 2000 — The Breaker Billiards (Untouchables) 8 ball pool team of Bryan Hanson, Nate Haugen and Nate Johnson were the 1999-2000 Junior 8 Ball Pool season champions. The team will advance to represent Bemidji at the Junior Nationals tournament in Rochester, Minnesota, in June. March 22, 1975 — The Bemidji High School ski team, which drew nearly 40 skiers, recently wrapped up a successful competition year in just its sixth season. The weather proved a major deterrent to the skiers, as several blizzards and an overabundance of snow made roads impassable and caused several meets to be wiped out. March 22, 1925 — Nearly 200 boys and girls are expected to enroll for the Club Workers' Short Course which will be held in the Bemidji High School building April 6-11. Held over spring break, students will have a chance to learn from civic club workers in the county. Free room and board will be provided with an enrollment fee of $2.
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21-03-2025
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3M Spin Off Solventum Targets Higher Margins, EPS Growth In 2025-2028 Strategy
On Thursday, Solventum (NYSE:SOLV) hosted its 2025 Investor Day, during which it outlined its strategic priorities, its business segments, and its long-range plan (LRP) to drive growth and value creation. Formerly 3 M's (NYSE:MMM) Health Care Business, Solventum, started trading as a newly independent healthcare company in April 2024. The company offers solutions for wound care, surgery, dental prevention, procedures, orthodontics, and software. 'Solventum has tremendous potential, with attractive businesses, large and growing markets, and highly regarded brands. We have undertaken a significant transformation to unlock the potential of our Medical Surgical, Dental Solutions, and Health Information Systems businesses, positioning the company to drive accelerated growth and create shareholder value,' said Bryan Hanson, CEO of Solventum. 'Solventum has entered 2025 as a more focused long-range plan demonstrates the progress we made in the last year and reflects our confidence in our ability to accelerate sales growth, expand margins, deliver EPS growth, and improve free cash flow,' Hanson concluded. Thermo Fisher Scientific Inc. (NYSE:TMO) agreed to acquire Solventum's Purification & Filtration (P&F) business for approximately $4.1 billion in cash in February. Solventum's Purification & Filtration business provides purification and filtration technologies for the production of biologics, medical technologies, and industrial applications. Solventum reaffirmed its fiscal year 2025 guidance and announced its long-range plan (LRP) for 2025 through 2028: Accelerate organic sales growth of 4% to 5% in 2028. Expand operating margins to be 23% to 25% in 2028 (inclusive of ~200bps 3M COGS increase). Generate EPS CAGR of 10% over the 3 years ending 2028 Drive free cash flow conversion of 80%+ Solventum reported fourth-quarter adjusted EPS of $1.41, beating the consensus of $1.32, and sales of $2.07 billion, beating the consensus of $2.05 billion. The company forecasts 2025 adjusted EPS of $5.45-$5.65, compared to a consensus of $5.50, and organic sales growth of +1.0% to +2.0%. Price Action: SOLV stock is down 1.57% at $73.81 at the last check Friday. Read Next:Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? This article 3M Spin Off Solventum Targets Higher Margins, EPS Growth In 2025-2028 Strategy originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Sign in to access your portfolio
