Bausch + Lomb (BLCO) came out with quarterly earnings of $0.17 per share, beating the Zacks Consensus Estimate of $0.16 per share. This compares to earnings of $0.22 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 6.25%. A quarter ago, it was expected that this company would post earnings of $0.13 per share when it actually produced earnings of $0.13, delivering no surprise. Over the last four quarters, the company has surpas ...

Financial Performance - Total revenue for Q3 2024 was $1.196 billion, a 19% increase from $1.007 billion in Q3 2023[4] - GAAP net income attributable to Bausch + Lomb was $4 million, compared to a net loss of $84 million in Q3 2023, representing a favorable change of $88 million[10] - Adjusted EBITDA (non-GAAP) for Q3 2024 was $212 million, up from $187 million in Q3 2023, an increase of $25 million[12] - Product sales for Q3 2024 reached $1,192 million, a 19% increase from $1,004 million in Q3 2023[33] - The adjusted EBITDA for the three months ended September 30, 2024, was $212 million, up from $187 million in the same period of 2023, reflecting a growth of 13%[37] - The adjusted net income for the three months ended September 30, 2024, was $144 million, compared to a loss of $84 million in the same period of 2023[37] - The company reported a net income of $4 million in Q3 2024, a significant improvement from a net loss of $84 million in Q3 2023[33] Segment Performance - Pharmaceuticals segment revenue surged 76% to $306 million in Q3 2024, driven by the acquisition of XIIDRA and the launch of MIEBO[8] - Surgical segment revenue increased by 11% to $206 million, primarily due to demand for premium IOL products[7] - Vision Care segment revenue grew 6% to $684 million, supported by sales from the dry eye portfolio and SiHy Daily lenses[6] - The Vision Care segment reported revenue of $684 million for the three months ended September 30, 2024, a 6% increase from $648 million in the same period of 2023[38] - The Pharmaceuticals segment experienced significant growth, with revenue increasing by 76% to $306 million for the three months ended September 30, 2024, compared to $174 million in 2023[38] Cash Flow and Guidance - Cash flow from operations for Q3 2024 was $154 million, significantly up from $48 million in Q3 2023, an increase of $106 million[11] - Full-year 2024 revenue guidance raised to $4.725 - $4.825 billion, reflecting strong performance and reduced currency headwinds[13] - Bausch + Lomb's cash, cash equivalents, and restricted cash totaled $350 million as of September 30, 2024[14] - Bausch + Lomb's 2024 full-year guidance is based on current management expectations and includes anticipated growth in key products like XIIDRA® and MIEBO®[17] Costs and Expenses - Research and development expenses for Q3 2024 were $84 million, slightly up from $82 million in Q3 2023[33] - The adjusted selling, general, and administrative expenses for the three months ended September 30, 2024, were $495 million, compared to $396 million in the same period of 2023[36] - The cost of goods sold for Q3 2024 was $464 million, an increase of 18.7% from $391 million in Q3 2023[33] Non-GAAP Measures - Adjusted EPS (non-GAAP) for Q3 2024 was $0.13, down from $0.22 in Q3 2023[12] - Adjusted net income (non-GAAP) for Q3 2024 was $46 million, compared to $76 million in Q3 2023, reflecting a decrease of 39%[34] - Non-GAAP financial measures are utilized to supplement GAAP measures, aiding investors in assessing the company's performance[20] - The company emphasizes that certain costs related to acquisitions and separations are excluded from non-GAAP measures to provide a clearer financial picture[26] Risks and Challenges - Risks associated with the proposed separation from Bausch Health Companies Inc. include potential delays and the need for various regulatory approvals[16] - Economic factors such as inflation and interest rates are anticipated to adversely impact revenue, expenses, and margins[17] - The company has incurred restructuring and transformation costs related to operational improvements and the separation process, which are expected to fluctuate significantly[25] - The company is pursuing acquisitions, including XIIDRA® and other ophthalmology assets, with associated risks of not realizing expected benefits in a timely manner[16] Foreign Exchange and Adjustments - The company experienced a foreign exchange loss of $5 million in Q3 2024, compared to a loss of $3 million in Q3 2023[33] - Total non-GAAP adjustments for Q3 2024 amounted to $42 million, compared to $160 million in Q3 2023[34] - The company utilized Constant Currency revenue growth to assess performance, indicating that foreign currency fluctuations can obscure underlying business trends[31]

Core Insights - Bausch + Lomb experienced a significant day with FDA approval and reports of a potential sale, leading to a stock price increase of over 7% [1] Group 1: FDA Approval - The FDA granted approval for Bausch + Lomb's full range of enVista Envy vision intraocular lenses (IOLs), which are used to treat cataracts and other vision disorders [4] Group 2: Potential Sale - Reports indicate that Bausch + Lomb is exploring a sale, with large U.S. investment firms Blackstone and TPG potentially collaborating on a buyout bid [2] - Bids for Bausch + Lomb are expected to range from $13 billion to $14 billion in enterprise value [3] - The management is working with advisor Goldman Sachs to gauge interest from potential buyers [2]

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Group 1 - Bausch + Lomb (BLCO) shares increased by 14.5% to $17.80, with a higher-than-average trading volume, contrasting with a 2.8% loss over the past four weeks [1][2] - The price surge is attributed to investor optimism following a Financial Times report indicating that Bausch + Lomb is considering a sale to address challenges from its spin-off from Bausch Health, with private equity firms likely interested [2][3] - The company is expected to report quarterly earnings of $0.16 per share, reflecting a year-over-year decline of 27.3%, while revenues are projected to be $1.17 billion, an increase of 15.8% from the previous year [3][4] Group 2 - The consensus EPS estimate for Bausch + Lomb has remained unchanged over the last 30 days, suggesting that the stock's price increase may not be sustainable without earnings estimate revisions [4] - Bausch + Lomb holds a Zacks Rank of 3 (Hold), indicating a neutral outlook, while another company in the same industry, Alignment Healthcare (ALHC), experienced a 3.2% decline in its last trading session [4][5] - Alignment Healthcare's consensus EPS estimate has decreased by 7.8% over the past month to -$0.14, representing a year-over-year change of 26.3% [5]

The highly indebted healthcare stock rose on rumors it may be selling itself. Shares of Bausch + Lomb (BLCO 15.63%) rallied 15.7% as of 3:07 p.m. ET today. The stock is surging today on news the company is considering selling itself. Of note, Bausch + Lomb is the eye-care subsidiary of Bausch Health Companies, which was formerly known as Valeant Pharmaceuticals. Bausch Health prefers cash, not shares Valeant got into trouble nearly a decade ago after using debt to buy up several pharmaceutical companies, th ...

Key Takeaways Bausch + Lomb is discussing a possible sale that would separate it from its parent company, Bausch Health Cos. Bausch Health is saddled with debt of $21 billion, nearly $10 billion of which is set to mature in 2027. In July, Bausch Health pushed back against a research firm's report that said it was mulling bankruptcy options. Bausch + Lomb (BLCO) shares popped Monday following a report that the eyecare company is considering a sale. The contact lens producer is working with Goldman Sachs (GS) ...

Product Portfolio and Development - Bausch + Lomb reported a comprehensive portfolio of approximately 400 products in eye health, marketed in around 100 countries [161]. - The company has over 60 projects in its global pipeline, including new contact lenses and next-generation cataract equipment [166]. - The acquisition of XIIDRA in September 2023 enhances the company's dry eye franchise, being the first non-steroid eye drop approved for dry eye disease [171]. - The company launched Blink NutriTears in June 2024, targeting root causes of dry eyes and promoting healthy tear production [168]. - Bausch + Lomb's Vision Care segment includes leading products like Biotrue ONEday daily disposables and Biotrue multi-purpose solution [163]. - The Surgical segment includes key brands such as Akreos and VICTUS femtosecond laser, focusing on cataract and retinal conditions [164]. - The company acquired AcuFocus in January 2023, enhancing its surgical portfolio with the IC-8 Apthera IOL [171]. - The company plans to launch enVista Aspire and enVista Envy in the U.S. and Europe in 2024 and 2025, respectively [169]. - The company has received FDA approval for Lumify Preservative Free, expected to launch in Q1 2025 [167]. Financial Performance - Product sales for the three months ended June 30, 2024, were $1,213 million, an increase of $182 million (approximately 17.6%) compared to $1,031 million for the same period in 2023 [190]. - Total revenues for the six months ended June 30, 2024, were $2,315 million, up $349 million (approximately 17.8%) from $1,966 million for the same period in 2023 [190]. - Operating income for the three months ended June 30, 2024, was $26 million, a decrease of $17 million (approximately 39.5%) compared to $43 million for the same period in 2023 [190]. - Net loss attributable to Bausch + Lomb Corporation for the three months ended June 30, 2024, was $151 million, an increase of $119 million compared to a net loss of $32 million for the same period in 2023 [190]. - The cost of goods sold for the three months ended June 30, 2024, was $482 million, an increase of $65 million (approximately 15.6%) compared to $417 million for the same period in 2023 [190]. - Selling, general, and administrative expenses for the three months ended June 30, 2024, were $535 million, an increase of $118 million (approximately 28.3%) compared to $417 million for the same period in 2023 [190]. - Revenues for the three months ended June 30, 2024, were $1,216 million, an increase of $181 million, or 17%, compared to $1,035 million in 2023 [192]. - Vision Care segment revenue increased by $51 million, or 8%, to $697 million, driven by sales from the dry eye portfolio and contact lenses, despite a $20 million unfavorable impact from foreign currencies [198]. - Pharmaceuticals segment revenue rose by $116 million, or 60%, to $310 million, primarily due to the XIIDRA acquisition and the launch of MIEBO, with incremental sales from XIIDRA contributing $89 million [199]. - Surgical segment revenue increased by $14 million, or 7%, to $209 million, driven by increased system sales and demand for consumables [199]. Cost and Expense Management - Cost of goods sold increased by $65 million, or 16%, to $482 million, primarily due to costs associated with recent acquisitions [204]. - SG&A expenses rose by $118 million, or 28%, to $535 million, mainly due to higher selling and advertising costs related to XIIDRA and MIEBO [205]. - R&D expenses decreased slightly by $1 million, or 1%, to $84 million, reflecting ongoing investment in product development [207]. - Amortization of intangible assets increased by $18 million, or 32%, to $74 million, primarily due to acquisitions [208]. - Operating income decreased by $17 million to $26 million, reflecting increased SG&A and amortization expenses [210]. - Total provisions to reduce gross product sales to net product sales were 35.4% for Q2 2024, up from 29.1% in Q2 2023, primarily due to increased rebates [202]. Segment Performance - Vision Care segment profit increased to $192 million in Q2 2024, up 15% from $167 million in Q2 2023, driven by higher volume and pricing [214]. - Pharmaceuticals segment profit rose to $78 million in Q2 2024, a 15% increase from $68 million in Q2 2023, primarily due to increased contributions from XIIDRA and MIEBO [214]. - Surgical segment profit decreased to $4 million in Q2 2024, down 56% from $9 million in Q2 2023, attributed to higher costs and selling expenses [215]. - Total revenues for the six months ended June 30, 2024, were $2,315 million, an 18% increase from $1,966 million in 2023, driven by acquisitions and increased volumes [221]. - Vision Care segment revenue was $1,332 million for the six months ended June 30, 2024, an 8% increase from $1,233 million in 2023, primarily from dry eye products and contact lenses [225]. - Pharmaceuticals segment revenue surged to $577 million in the first half of 2024, a 63% increase from $355 million in 2023, mainly due to the XIIDRA acquisition and MIEBO launch [228]. Challenges and Risks - The ongoing Russia-Ukraine war has impacted the company's distribution capabilities, but necessary licenses have been obtained to sell products in those regions [175]. - Revenues attributable to Russia, Ukraine, and Belarus accounted for approximately 3% of total revenues for both the six months ended June 30, 2024, and the year ended December 31, 2023 [177]. - Revenues attributable to Israel and Iran were less than 1% of total revenues for the six months ended June 30, 2024, and the year ended December 31, 2023 [178]. - The company has implemented actions to mitigate supply chain challenges, resulting in higher inventory costs that have pressured margins, particularly in the surgical business [179]. - The company is facing challenges related to its initial public offering and the complexities of managing an independent business [285]. - The company is navigating challenges related to international operations, including compliance with varying regulatory regimes and geopolitical risks [290]. - The company faces challenges in obtaining components and raw materials, which may lead to manufacturing and supply difficulties [292]. - Economic factors such as historically high domestic and global inflation, interest rates, and foreign currency rates could impact revenues and margins [292]. - The company is exposed to interest rate risks associated with floating rate debt borrowings [292]. - There are uncertainties regarding the successful improvement and modification of existing products and the development of new products, which may require significant expenditures [292]. - The company is subject to compliance risks related to extensive regulations in marketing and business practices, including health care fraud laws and anti-bribery laws [293]. - Potential impacts from health care reforms and changes in legislation could affect the company's operations and pricing strategies [294]. - The company has identified risks related to illegal distribution or sale of counterfeit products, which could harm its market position [294]. - The company cautions that the list of factors affecting future results is not exhaustive and should be carefully considered by investors [295]. Debt and Interest Management - Interest expense rose to $102 million in Q2 2024, an increase of $44 million from $58 million in Q2 2023, mainly due to new debt instruments [217]. - Net loss attributable to Bausch + Lomb Corporation was $151 million in Q2 2024, a significant increase from a loss of $32 million in Q2 2023, driven by higher taxes and interest expenses [220]. - SG&A expenses increased by $204 million, or 24%, to $1,039 million for the six months ended June 30, 2024, primarily due to higher selling and advertising costs [233]. - R&D expenses rose by $4 million, or 2%, to $166 million for the same period, driven by ongoing product development [233]. - Amortization of intangible assets increased by $35 million, or 31%, to $148 million, mainly due to acquisitions [234]. - Operating income decreased by $9 million, or 22%, to $32 million, reflecting higher SG&A and amortization expenses [236]. - Interest expense surged by $93 million to $201 million, attributed to various debt facilities [241]. - Provision for income taxes increased by $102 million to $145 million, influenced by changes in earnings jurisdiction and discrete tax effects [243]. - Net cash provided by operating activities was $56 million, an increase of $136 million compared to a net cash used of $80 million in the prior year [246]. - As of June 30, 2024, the interest rate for borrowings under the Revolving Credit Facility ranges from 8.18% to 8.19% per annum [259]. - The stated interest rate under the May 2027 Term Facility at June 30, 2024 was 8.69% per annum [261]. - The stated interest rate under the September 2028 Term Facility at June 30, 2024 was 9.34% per annum [262]. - Bausch + Lomb issued $1,400 million aggregate principal amount of 8.375% Senior Secured Notes due October 2028 [265]. - The Company expects to make interest payments of approximately $200 million and mandatory debt amortization payments of $15 million for the period July 1, 2024 through December 31, 2024 [273]. - The remaining mandatory quarterly amortization payments for the May 2027 Term Facility were $69 million through March 2027 [264]. - The remaining mandatory quarterly amortization payments for the September 2028 Term Facility were $20 million through June 2028 [264]. - As of July 24, 2024, Bausch + Lomb had 351,895,407 issued and outstanding common shares [280]. - The weighted average stated rate of interest for the Company's outstanding debt obligations as of June 30, 2024 was 8.63% [269]. - Bausch + Lomb acquired AcuFocus, Inc. for an up-front purchase price of $35 million, with $31 million paid in January 2023 [274]. - The company anticipates continued improvement in operational efficiency and plans to manage cash and working capital requirements for the remainder of 2024 and beyond [285].

Financial Performance - Bausch + Lomb reported a strong Q2 2024 performance with revenue growth of 17% to $1.216 billion compared to $1.035 billion in Q2 2023[10, 14] - Constant Currency (CC) revenue growth was even stronger at +20% compared to Q2 2023[8, 10] - Adjusted Gross Profit increased by 22% to $753 million, with an Adjusted Gross Margin of 61.9%, a 220 bps increase year-over-year[16] - The company is raising its FY24 revenue guidance to $4.7 - $4.8 billion and CC revenue growth to ~16-18%[20] - Adjusted EBITDA guidance is also raised to $850 - $900 million[20] Segment Performance - All segments contributed to the growth, with Pharmaceuticals leading at +61% CC revenue growth[11] - Vision Care segment revenue grew by 11% CC, Surgical by 9% CC[11] Key Growth Drivers - The Daily SiHy portfolio experienced significant growth, with a +67% increase in Q2 2024 revenue[24] - OTC Dry Eye Portfolio grew +24%[25]

Bausch + Lomb Corporation (NYSE:BLCO) Q2 2024 Earnings Call July 31, 2024 8:00 AM ET Company Participants George Gadkowski - Vice President, Investor Relations Brent Saunders - Chairman and Chief Executive Officer Sam Eldessouky - Chief Financial Officer Conference Call Participants Xuyang Li - Jefferies Patrick Wood - Morgan Stanley Craig Bijou - Bank of America Robbie Marcus - JPMorgan Douglas Miehm - RBC Capital Markets Matt Miksic - Barclays Operator Good morning, and welcome to Bausch + Lomb’s Second Q ...