Henry Schein 2014 Annual Report Download - page 7

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HENRY SCHEIN 2014
During 2014, Henry Schein delivered solid financial performance across each of
our business groups and demonstrated that our strategic priorities are enabling
us to invest for profitable growth. Our position of acting as a trusted advisor to
our customers and supplier partners continues to drive our success. Our customers
“Rely on Us” because we provide a wide selection of products, value-added
services and solutions, along with expert advice and support for their evolving
needs. Our strategy is built upon the strength of our trusted relationships.
2014 marked the culmination of our three-year strategic plan aimed at expanding
our geographic operations, enhancing our commitment to global corporate
social responsibility, and refining our strategic focus for the future. The results
reflect the commitment of Team Schein Members across the globe embracing
and driving that strategy. Specifically, during that three-year period, we entered
five new countries, strengthening our position as a leading global provider of
value-added solutions for our customers. We successfully added more than 30 companies and more than 2,500
Team Schein Members. We reorganized to align our interests among three global vertical business groups and
strengthened our market position as the number one global dental distributor, the top global animal health
distributor, the second-largest physician and alternate-care distributor, and the number one global practice
management solutions provider.
From a financial perspective, 2014 net sales increased by 8.5% to $10.4 billion, exceeding the $10 billion threshold
for the first time. Operating cash flow and free cash flow of $592.5 million and $510.4 million, respectively, both
exceeded net income, which is one of our longstanding financial goals. Diluted earnings per share of $5.44 set a
record, and increased 9.9% when adjusted for non-GAAP items in 2013*. We also repurchased $300 million of our
common stock, in line with our annual share repurchase goal.
This strong financial performance was also evident by the progress among our four global business groups, each
of which gained market share during 2014 and posted record sales. Dental sales reached $5.4 billion, up 7.7% over
the previous year, and Animal Health sales increased 11.5% to $2.9 billion. Medical sales were up 6.1% to $1.7
billion, while Technology and Value-Added Services sales were $348.9 million, up 9.0%.
Henry Schein’s financial success fueled the Company’s climb up the ranks of the
FORTUNE 500® list of America’s largest companies by revenue. The Company
now ranks number 292 on the FORTUNE 500, having debuted on the list in 2004
at number 497. In recent months, we were pleased to be selected as a component
of the S&P 500® index, widely considered a leading indicator of U.S. equity trading.
Last year, we further expanded Henry Schein’s operations geographically and strategically. We entered Japan, the
world’s second-largest dental market, with an investment in Iwase Dental Supply, and we established operations
in South America with an investment in Dental Speed Graph in Brazil. We now have operations or affiliates in
29 countries on six continents.
A MESSAGE FROM THE CHAIRMAN OF THE BOARD
AND CHIEF EXECUTIVE OFFICER
#292 ON FORTUNE 500
LIST OF AMERICA’S
LARGEST
COMPANIES
* See reconciliation of GAAP and Non-GAAP measures on page 12.