Becton Dickinson and Company Earnings: Increasing Costs Tighten Margins as Net Income Falls

S&P 500 (NYSE:SPY) component Becton Dickinson and Company (NYSE:BDX) reported its results for the first quarter. Becton, Dickinson & Company provides healthcare institutions, life science researchers, clinical laboratories, and individual consumers with laboratory equipment, medical supplies, devices, and diagnostic products.

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Becton Dickinson and Company Earnings Cheat Sheet for the First Quarter

Results: Net income for the medical instruments and supplies company fell to $263 million ($1.21 per share) vs. $315.9 million ($1.36 per share) a year earlier. This is a decline of 16.8% from the year earlier quarter.

Revenue: Rose 2.5% to $1.89 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: Becton Dickinson and Company beat the mean analyst estimate of $1.17 per share. Analysts were expecting revenue of $1.88 billion.

Quoting Management: “We are pleased with our solid start to fiscal year 2012 given the challenging macroeconomic climate,” said Vincent A. Forlenza, Chief Executive Officer and President. “Our operating results reflect our increased investments in high-growth areas. We will continue to drive efficiency throughout the Company and we remain committed to delivering value to our customers and shareholders.”

Key Stats:

Gross margin shrank 2.1 percentage points to 50.9%. The contraction appeared to be driven by increased costs, which rose 7% from the year earlier quarter while revenue rose 2.5%.

Revenue has risen the past four quarters. Revenue increased 18.4% to $2.05 billion in the fourth quarter of the last fiscal year. The figure rose 7.2% in the third quarter of the last fiscal year from the year earlier and climbed 4.2% in the second quarter of the last fiscal year from the year-ago quarter.

The company has now seen net income fall in each of the last two quarters. In the fourth quarter of the last fiscal year, net income fell 24.4% from the year earlier quarter.

The company beat estimates last quarter after being in line with expectations in the fourth quarter of the last fiscal year with net income of $1.39 per share.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the second quarter has moved down from $1.43 a share to $1.42 over the last sixty days. Over the past sixty days, the average estimate for the fiscal year has reached $5.79 abs per share, a decline from $5.82.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com