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Dentsply International Reports Record Third Quarter 2015 Results

The following excerpt is from the company's SEC filing.

Adjusted earnings of $0.66 per diluted share, up 6.5% vs. $0.62 in prior year period

Adjusted operating margin for the third quarter expanded 220 bps to 20.9%

Revenue excluding precious metals up 1.4% in constant currency in the third quarter; Fx headwind 9.1%

Operating cash flow growth of 8.3% in the third quarter

- DENTSPLY International Inc. (NASDAQ: XRAY) today announced sales and earnings for the three and nine months ended September 30, 2015.

Third Quarter Results

Net sales in the third quarter of 2015 of $648.9 million decreased 8. 4% compared to $708.2 million in the third quarter of 2014. Net sales, excluding metals content, of $629.3 million decreased 7.7% compared to $681.6 million in the third quarter of 2014. Revenue for the three months, excluding precious metals, grew 1.4% on a constant currency basis, offset by a 9.1% headwind from foreign currency translation.

Net income attributable to DENTSPLY International for the third quarter of 2015 was $84.5 million, or $0.59 per diluted share, compared to $75.3 million, or $0.52 per diluted share in the second quarter of 2014. On an adjusted basis, excluding certain items, net earnings per diluted share grew 6.5% to $0.66 compared to $0.62 in the third quarter of 2014. A reconciliation of the adjusted earnings per share, a non-US GAAP measure, to earnings per share calculated on a US-GAAP basis is provided in the attached table.

Nine months 2015 Results

Net sales for the first nine months of 2015 of $2.0 billion decreased 9.1% compared to $2.2 billion for the first nine months of 2014. Net sales for the nine months, excluding precious metals content, of $1.9 billion decreased 7.9% compared to $2.1 billion in the first nine months of 2014. Revenue for the first nine months of 2015 grew 2.0% on a constant currency basis, offset by a 9.9% headwind from foreign currency translation.

Net income attributable to DENTSPLY International for the first nine months of 2015 was $192.6 million, or $1.35 per diluted share, compared to $238.1 million, or $1.65 per diluted share in the first nine months of 2014. On an

adjusted basis, excluding certain items, net earnings per diluted share grew 3.7% to $1.97 compared to $1.90 in the first nine months of 2014.

Outlook

Bret Wise, DENTSPLY’s Chairman and Chief Executive Officer, stated “During the third quarter, the business continued to achieve strong earnings growth despite a significant headwind from currency. We have been executing our global efficiency program and have realized improved margins well ahead of plan. For the third quarter, adjusted operating margin of 20.9% improved 220 basis points and, over a two-year period, the cumulative improvement was 300 basis points. Looking ahead, we are now poised to increase investment in growth opportunities, while also improving margins further, both important elements in driving shareholder value. Based on the results through nine months and our outlook for the balance of the year, we are increasing full-year 2015 adjusted earnings guidance to the range of $2.58 to $2.64 per diluted share.”

Merger Update

On September 15, 2015, the Company and Sirona Dental Systems, Inc. (“Sirona”) entered into an Agreement and Plan of Merger and announced a merger of equals between the two companies. Mr. Wise commented, “We are excited about the possibilities that this merger brings to the dental market, our customers and shareholders. We are actively pursuing the regulatory and shareholder approvals required to complete the merger and expect the transaction to close in the first quarter of 2016.”

Additional Information

A conference call is scheduled to begin today at 8:30 a.m. (Eastern Time) with a live webcast to discuss these financial results. Supplemental materials for reference during the call will be available for download in the investor relations section of DENTSPLY's web site, at www.dentsply.com.

Investors can access the webcast via a link on DENTSPLY’s web site at www.dentsply.com. For those planning to participate on the call, please dial (877) 856-1969 for domestic calls, or (719) 325-4903 for international calls. The Conference ID # is 4311375. Members of management speaking on the call will include Bret Wise, DENTSPLY’s Chairman and Chief Executive Officer, Chris Clark, President and Chief Financial Officer, and Jim Mosch, Executive Vice President and Chief Operating Officer.

A rebroadcast of the conference call will be available online at the DENTSPLY web site, and a dial-in replay will be available for one week following the call at (888) 203-1112 (for domestic calls) or (719) 457-0820 (for international calls), Replay Passcode # 4311375.

DENTSPLY International Inc. is a leading manufacturer and distributor of dental and other consumable medical device products. The Company believes it is the world's largest manufacturer of consumable dental products for the professional dental market. For over 115 years, DENTSPLY's commitment to innovation and professional collaboration has enhanced its portfolio of branded consumables and small equipment. Headquartered in the United States, the Company has global operations with sales in more than 120 countries. Visit www.dentsply.com for more information about DENTSPLY and its products.

This press release contains forward-looking information (within the meaning of the Private Securities Litigation Reform Act of 1995) regarding future events or the future financial...


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