Business Wire | Nov 2, 2021 06:30AM EDT

Henry Schein Reports Record Third-Quarter 2021 Financial Results From Continuing Operations

Nov. 02, 2021

MELVILLE, N.Y.--(BUSINESS WIRE)--Nov. 02, 2021--Henry Schein, Inc. (Nasdaq: HSIC), the world's largest provider of health care solutions to office-based dental and medical practitioners, today reported record third-quarter financial results from continuing operations. Results from continuing operations exclude contributions from Henry Schein's former Animal Health business, which was spun off in February 2019 to form a new publicly traded company, Covetrus (Nasdaq: CVET).

Total net sales for the quarter ended September 25, 2021, were $3.2 billion, up 11.9% compared with the third quarter of 2020. The 11.9% increase included 7.2% internal growth in local currencies, 3.9% growth from acquisitions and 0.8% growth related to foreign currency exchange. (See Exhibit A for details of sales growth.)

GAAP net income attributable to Henry Schein, Inc. from continuing operations for the third quarter of 2021 was $162.3 million, or $1.15 per diluted share, compared with prior-year GAAP net income attributable to Henry Schein, Inc. from continuing operations of $141.7 million, or $0.99 per diluted share. Non-GAAP net income from continuing operations for the third quarter of 2021 was $154.8 million, or $1.10 per diluted share, compared with prior-year non-GAAP net income from continuing operations of $147.0 million, or $1.03 per diluted share. Exhibit B provides a reconciliation of GAAP net income and diluted EPS from continuing operations to non-GAAP net income and diluted EPS from continuing operations.

"Today we reported record third-quarter financial results, driven by a keen focus on execution by Team Schein and steady patient traffic, resulting in excellent momentum across the entire company. We believe that patient traffic was generally similar to the previous quarter for our dental customers and is improving for our medical customers. Compared with the year-ago quarter, Henry Schein's worldwide internal sales in local currencies increased a robust 7.2%, or 6.3% excluding sales of personal protective equipment (PPE) and COVID-19 related products," said Stanley M. Bergman, Chairman of the Board and Chief Executive Officer of Henry Schein. "Our third quarter financial results are solid with growth in diluted EPS from continuing operations of 16.2% on a GAAP basis and 6.8% on a non-GAAP basis."

Global Dental sales for the third quarter of 2021 of $1.8 billion increased 10.5% versus the prior-year period. In local currencies, internally generated sales increased 5.2% with 3.9% growth from acquisitions and 1.4% growth related to foreign currency exchange. The 5.2% internal growth in local currencies included growth of 4.7% in North America and 5.9% internationally.

Global Dental consumable merchandise internal sales growth was 2.9% in local currencies. Excluding sales of PPE and COVID-19 related products, internal sales growth in local currencies was 4.8%. In North America, dental consumable merchandise internal sales in local currencies increased 3.9%, and 5.7% when excluding sales of PPE and COVID-19 related products, and dental equipment internal sales in local currencies increased 7.8%. Internationally, dental consumable merchandise internal sales in local currencies increased 1.3%, and 3.5% when excluding sales of PPE and COVID-19 related products, and dental equipment internal sales in local currencies increased 23.9%.

"North America dental consumable merchandise internal sales growth in local currencies with and without PPE and COVID-19 related products was solid in the third quarter. Consumable merchandise sales continued to improve, which we believe were bolstered by a steady flow of patient traffic," said Mr. Bergman. "North America dental equipment sales growth reflected strong sales of high-technology equipment and modest growth of traditional equipment sales which remain impacted by equipment manufacturing and office construction delays. Overall gains in consumable merchandise and equipment sales in North America and International markets reflect the continuing recovery of underlying markets."

Global Medical sales for the third quarter of 2021 of $1.2 billion increased 15.5% versus the comparable period last year, consisting of 13.1% internal growth in local currencies and 2.4% growth from acquisitions. There was no impact related to foreign currency exchange. Excluding sales of PPE and COVID-19 related products, internal sales in local currencies increased 8.3%.

"Global Medical internal sales growth in local currencies for the third quarter was once again very strong, with and without sales of PPE and COVID-19 related products. Trends in the physician office, ambulatory surgery center and alternate care markets all were positive, and we have increased the number of accounts we serve and further penetrated existing accounts," said Mr. Bergman.

Global Technology and Value-Added Services sales of $168.6 million increased 21.9% versus the prior-year quarter and included 6.3% internal sales growth in local currencies, 14.7% growth from acquisitions and 0.9% growth related to foreign currency exchange.

"Global Technology and Value-Added Services sales growth was driven by the acquisitions we made over the past year in software analytics and by expanding our range of dental practice solutions. We also saw solid sales growth in Dentrix technical support, our Dentrix Ascend cloud solution and our Software of Excellence business in the UK," added Mr. Bergman.

Stock Repurchase Plan

During the third quarter of 2021, the Company repurchased approximately 650,000 shares of its common stock at an average price of $76.77 per share, for a total of approximately $50 million. The impact of the repurchase of shares on third-quarter diluted EPS was immaterial. At the end of the third quarter, Henry Schein had approximately $350 million authorized and available for future stock repurchases.

Year-to-Date Financial Results

Net sales from continuing operations for the first nine months of 2021 were $9.1 billion, an increase of 30.4% compared with the first nine months of 2020. The 30.4% increase included 24.0% internal growth in local currencies, 4.1% growth from acquisitions and 2.3% growth related to foreign currency exchange.

GAAP net income attributable to Henry Schein, Inc. from continuing operations for the first nine months of 2021 was $484.0 million, or $3.40 per diluted share, compared with GAAP net income attributable to Henry Schein, Inc. from continuing operations of $260.9 million, or $1.82 per diluted share, for the first nine months of 2020. Non-GAAP net income from continuing operations for the first nine months of 2021 was $489.9 million, or $3.45 per diluted share, compared with non-GAAP net income from continuing operations of $281.7 million, or $1.97 per diluted share, for the first nine months of 2020. Non-GAAP results for the first nine months of 2021 and 2020 exclude certain items noted in Exhibit B, which provides a reconciliation of GAAP net income and diluted EPS from continuing operations to non-GAAP net income and diluted EPS from continuing operations.

2021 Financial Guidance

Henry Schein today increases guidance for 2021 non-GAAP diluted EPS from continuing operations. At this time, the Company is not providing guidance for 2021 GAAP diluted EPS from continuing operations as it is unable to provide without unreasonable effort an estimate of costs related to an ongoing restructuring initiative, including the corresponding tax effect. Financial guidance is as follows:

* 2021 non-GAAP diluted EPS from continuing operations is expected to be $4.27 to $4.35, reflecting growth of 44% to 46% compared with 2020 non-GAAP diluted EPS from continuing operations of $2.97. This compares with previous guidance for 2021 non-GAAP diluted EPS from continuing operations to be at or above $3.85.

* Guidance for 2021 non-GAAP diluted EPS is for current continuing operations as well as completed or previously announced acquisitions and does not include the impact of future share repurchases, potential future acquisitions, if any, or restructuring expenses. Guidance also assumes that foreign currency exchange rates are generally consistent with current levels, that end markets remain stable and are consistent with current market conditions, and that there are no material adverse market changes associated with COVID-19.

2022 Financial Guidance

Henry Schein today introduces preliminary guidance for 2022 non-GAAP diluted EPS from continuing operations. At this time, the Company is not providing guidance for 2022 GAAP diluted EPS from continuing operations as it is unable to provide without unreasonable effort an estimate of restructuring costs for 2021, including the corresponding tax effect, which serves as the basis for 2022 GAAP diluted EPS guidance. Financial guidance is as follows:

* Growth in 2022 non-GAAP diluted EPS from continuing operations in the mid to high single digits over 2021 non-GAAP diluted EPS from continuing operations.

* Preliminary guidance for 2022 non-GAAP diluted EPS growth is for current continuing operations as well as completed or previously announced acquisitions and does not include the impact of future share repurchases, potential future acquisitions, if any, or restructuring expenses. Preliminary guidance also assumes that foreign currency exchange rates are generally consistent with current levels, that end markets remain stable and are consistent with current market conditions, and that there are no material adverse market changes associated with COVID-19.

Adjustments to Projected 2021 and 2022 Non-GAAP Diluted EPS

The Company has provided guidance for 2021 and preliminary guidance for 2022 diluted EPS from continuing operations on a non-GAAP basis, as noted above. A reconciliation to the Company's projected 2021 diluted EPS from continuing operations prepared on a GAAP basis is not provided because the Company is unable to provide without unreasonable effort an estimate of costs related to an ongoing restructuring initiative to mitigate stranded costs and drive additional operating efficiencies, including the corresponding tax effect that will be included in the Company's 2021 diluted EPS from continuing operations prepared on a GAAP basis. A reconciliation to the Company's projected 2022 diluted EPS from continuing operations prepared on a GAAP basis is not provided because the Company is unable to provide without unreasonable effort an estimate of restructuring costs for 2021, including the corresponding tax effect, which serves as a basis of 2022 GAAP diluted EPS guidance. The inability to provide these reconciliations is due to the uncertainty and inherent difficulty of predicting the occurrence, magnitude, financial impact and timing of related costs. Management does not believe these items are representative of the Company's underlying business performance. For the same reasons, the Company is unable to address the probable significance of the unavailable information, which could be material to future results.

Third-Quarter 2021 Conference Call Webcast

The Company will hold a conference call to discuss third-quarter 2021 financial results today, beginning at 10:00 a.m. Eastern time. Individual investors are invited to listen to the conference call through Henry Schein's website by visiting www.henryschein.com/IRwebcasts. In addition, a replay will be available beginning shortly after the call has ended for a period of one week.

About Henry Schein, Inc.

Henry Schein, Inc. (Nasdaq: HSIC) is a solutions company for health care professionals powered by a network of people and technology. With more than 21,000 Team Schein Members worldwide, the Company's network of trusted advisors provides more than 1 million customers globally with more than 300 valued solutions that help improve operational success and clinical outcomes. Our Business, Clinical, Technology and Supply Chain solutions help office-based dental and medical practitioners work more efficiently so they can provide quality care more effectively. These solutions also support dental laboratories, government and institutional health care clinics, as well as other alternate care sites.

Henry Schein operates through a centralized and automated distribution network, with a selection of more than 120,000 branded products and Henry Schein private-brand products in stock, as well as more than 180,000 additional products available as special-order items.

A FORTUNE 500 Company and a member of the S&P 500(r) index, Henry Schein is headquartered in Melville, N.Y., and has operations or affiliates in 32 countries and territories. The Company's sales reached $10.1 billion in 2020, and have grown at a compound annual rate of approximately 12 percent since Henry Schein became a public company in 1995.

For more information, visit Henry Schein at www.henryschein.com, Facebook.com/HenrySchein, and @HenrySchein on Twitter.

Cautionary Note Regarding Forward-Looking Statements and Use of Non-GAAP Financial Information

In accordance with the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995, we provide the following cautionary remarks regarding important factors that, among others, could cause future results to differ materially from the forward-looking statements, expectations and assumptions expressed or implied herein. All forward-looking statements made by us are subject to risks and uncertainties and are not guarantees of future performance. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance and achievements or industry results to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These statements include EPS guidance and are generally identified by the use of such terms as "may," "could," "expect," "intend," "believe," "plan," "estimate," "forecast," "project," "anticipate," "to be," "to make" or other comparable terms. A fuller discussion of our operations, financial condition and status of litigation matters, including factors that may affect our business and future prospects, is contained in documents we have filed with the United States Securities and Exchange Commission, or SEC, including our Annual Report on Form 10-K, and will be contained in all subsequent periodic filings we make with the SEC. These documents identify in detail important risk factors that could cause our actual performance to differ materially from current expectations. Forward looking statements include the overall impact of the Novel Coronavirus Disease 2019 (COVID-19) on the Company, its results of operations, liquidity, and financial condition (including any estimates of the impact on these items), the rate and consistency with which dental and other practices resume or maintain normal operations in the United States and internationally, expectations regarding PPE and COVID-19 related product sales and inventory levels, whether additional resurgences or variants of the virus will adversely impact the resumption of normal operations, whether vaccine mandates will adversely impact the Company (by disrupting our workforce and/or business), whether supply chain disruptions will adversely impact our business, the impact of restructuring programs as well as of any future acquisitions, and more generally current expectations regarding performance in current and future periods. Forward looking statements also include the (i) ability of the Company to make additional testing available, the nature of those tests and the number of tests intended to be made available and the timing for availability, the nature of the target market, as well as the efficacy or relative efficacy of the test results given that the test efficacy has not been, or will not have been, independently verified under normal FDA procedures and (ii) potential for the Company to distribute the COVID-19 vaccines and ancillary supplies.

Risk factors and uncertainties that could cause actual results to differ materially from current and historical results include, but are not limited to: risks associated with COVID-19 and any variants thereof, as well as other disease outbreaks, epidemics, pandemics, or similar wide spread public health concerns and other natural disasters or acts of terrorism; our dependence on third parties for the manufacture and supply of our products; our ability to develop or acquire and maintain and protect new products (particularly technology products) and technologies that achieve market acceptance with acceptable margins; transitional challenges associated with acquisitions, dispositions and joint ventures, including the failure to achieve anticipated synergies/benefits; financial and tax risks associated with acquisitions, dispositions and joint ventures; certain provisions in our governing documents that may discourage third-party acquisitions of us; effects of a highly competitive (including, without limitation, competition from third-party online commerce sites) and consolidating market; the potential repeal or judicial prohibition on implementation of the Affordable Care Act; changes in the health care industry; risks from expansion of customer purchasing power and multi-tiered costing structures; increases in shipping costs for our products or other service issues with our third-party shippers; general global macro-economic and political conditions, including international trade agreements and potential trade barriers; failure to comply with existing and future regulatory requirements; risks associated with the EU Medical Device Regulation; failure to comply with laws and regulations relating to health care fraud or other laws and regulations; failure to comply with laws and regulations relating to the confidentiality of sensitive personal information or standards in electronic health records or transmissions; changes in tax legislation; litigation risks; new or unanticipated litigation developments and the status of litigation matters; cyberattacks or other privacy or data security breaches; risks associated with our global operations; our dependence on our senior management, as well as employee hiring and retention; and disruptions in financial markets. The order in which these factors appear should not be construed to indicate their relative importance or priority.

We caution that these factors may not be exhaustive and that many of these factors are beyond our ability to control or predict. Accordingly, any forward-looking statements contained herein should not be relied upon as a prediction of actual results. We undertake no duty and have no obligation to update forward-looking statements.

Included within the press release are non-GAAP financial measures that supplement the Company's Consolidated Statements of Income prepared under generally accepted accounting principles (GAAP). These non-GAAP financial measures adjust the Company's actual results prepared under GAAP to exclude certain items. In the schedules attached to this press release, the non-GAAP measures have been reconciled to and should be considered together with the Consolidated Statements of Income. Management believes that non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance and allow for greater transparency with respect to key metrics used by management in operating our business. These non-GAAP financial measures are presented solely for informational and comparative purposes and should not be regarded as a replacement for corresponding, similarly captioned, GAAP measures.

HENRY SCHEIN, INC.CONSOLIDATED STATEMENTS OF INCOME(in thousands, except per share data)(unaudited)

Three Months Ended Nine Months Ended

September September September September 25, 26, 25, 26,

2021 2020 2021 2020



Net sales $ 3,178,315 $ 2,840,146 $ 9,070,499 $ 6,953,416

Cost of sales 2,266,170 2,085,878 6,377,752 4,998,868

Gross 912,145 754,268 2,692,747 1,954,548 profit

Operating expenses:

Selling, general and 701,499 559,605 2,038,292 1,572,732 administrative

Restructuring (175) 6,992 3,360 27,713 costs (credits)

Operating 210,821 187,671 651,095 354,103 income

Other income (expense):

Interest income 1,409 2,294 4,749 7,481

Interest expense (6,550) (11,111) (19,411) (29,409)

Other, net 403 (1,699) 1,066 (2,210)

Income from continuing operations before taxes,

equity in earnings of affiliates and 206,083 177,155 637,499 329,965 noncontrolling interests

Income taxes (49,276) (29,005) (153,988) (65,965)

Equity in earnings of 5,349 3,663 17,550 7,808affiliates

Gain on sale of 7,318 - 7,318 -equity investment

Net income from 169,474 151,813 508,379 271,808continuing operations

Income (loss) fromdiscontinued - (29) - 274operations, net oftax

Net income 169,474 151,784 508,379 272,082

Less: Net income attributable to (7,188) (10,087) (24,380) (10,921) noncontrolling interests

Net incomeattributable to Henry $ 162,286 $ 141,697 $ 483,999 $ 261,161Schein, Inc.

Amounts attributable to Henry Schein Inc.:

Continuing operations $ 162,286 $ 141,726 $ 483,999 $ 260,887

Discontinued - (29) - 274operations

Net incomeattributable to Henry $ 162,286 $ 141,697 $ 483,999 $ 261,161Schein, Inc.



Earnings per sharefrom continuingoperations attributable to HenrySchein, Inc.:



Basic $ 1.16 $ 1.00 $ 3.44 $ 1.83

Diluted $ 1.15 $ 0.99 $ 3.40 $ 1.82



Earnings per sharefrom discontinuedoperations attributable to HenrySchein, Inc.:



Basic $ - $ - $ - $ -

Diluted $ - $ - $ - $ -



Earnings per shareattributable to Henry Schein, Inc.:



Basic $ 1.16 $ 1.00 $ 3.44 $ 1.83

Diluted $ 1.15 $ 0.99 $ 3.40 $ 1.82



Weighted-averagecommon shares outstanding:

Basic 139,377 142,362 140,661 142,553

Diluted 141,079 143,091 142,179 143,308



Note: Certain prior period amounts have been reclassified to conform to thecurrent period presentation.

HENRY SCHEIN, INC.CONSOLIDATED BALANCE SHEETS(in thousands, except share and per share data)

September December 25, 26,

2021 2020

(unaudited)

ASSETS

Current assets:

Cash and cash equivalents $ 119,133 $ 421,185

Accounts receivable, net of reserves of $73,095 1,551,946 1,424,787 and $88,030

Inventories, net 1,784,050 1,512,499

Prepaid expenses and other 457,232 432,944

Total current assets 3,912,361 3,791,415

Property and equipment, net 355,675 342,004

Operating lease right-of-use assets 329,886 288,847

Goodwill 2,779,234 2,504,392

Other intangibles, net 645,832 479,429

Investments and other 397,764 366,445

Total assets $ 8,420,752 $ 7,772,532



LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable $ 1,057,127 $ 1,005,655

Bank credit lines 59,394 73,366

Current maturities of long-term debt 9,638 109,836

Operating lease liabilities 77,383 64,716

Accrued expenses:

Payroll and related 345,438 295,329

Taxes 157,446 138,671

Other 594,979 595,529

Total current liabilities 2,301,405 2,283,102

Long-term debt 705,540 515,773

Deferred income taxes 37,248 30,065

Operating lease liabilities 270,152 238,727

Other liabilities 388,211 392,781

Total liabilities 3,702,556 3,460,448



Redeemable noncontrolling interests 612,582 327,699

Commitments and contingencies



Stockholders' equity:

Preferred stock, $0.01 par value, 1,000,000 shares authorized,

none outstanding - -

Common stock, $0.01 par value, 480,000,000 shares authorized,

139,129,543 outstanding on September 25, 2021 and

142,462,571 outstanding on December 26, 2020 1,391 1,425

Additional paid-in capital - -

Retained earnings 3,594,238 3,454,831

Accumulated other comprehensive loss (137,640) (108,084)

Total Henry Schein, Inc. stockholders' equity 3,457,989 3,348,172

Noncontrolling interests 647,625 636,213

Total stockholders' equity 4,105,614 3,984,385

Total liabilities, redeemable noncontrolling $ 8,420,752 $ 7,772,532 interests and stockholders' equity





HENRY SCHEIN, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(in thousands, unaudited)

Three Months Ended Nine Months Ended

September September September September 25, 26, 25, 26,

2021 2020 2021 2020



Cash flows from operating activities:

Net income $ 169,474 $ 151,784 $ 508,379 $ 272,082

Income (loss) from discontinued - (29) - 274 operations

Income from 169,474 151,813 508,379 271,808 continuing operations

Adjustments to reconcile net income to net cash provided by

Depreciation and 51,555 44,569 150,833 138,515 amortization

Impairment charge on intangible - - - 2,149 assets

Gain on sale of (9,757) - (9,757) - equity investment

Stock-based compensation 27,546 5,710 57,700 (6,648) expense (credit)

Provision for (benefit from) losses on trade (4,723) 5,832 (8,795) 34,590 and other accounts receivable

Benefit from deferred income (6,430) (15,322) (725) (48,193) taxes

Equity in earnings of (5,349) (3,663) (17,550) (7,808) affiliates

Distributions from equity 4,288 5,833 15,035 10,053 affiliates

Changes in unrecognized tax (193) (19,745) (6,479) (18,365) benefits

Other (3,477) 4,567 (48) 4,794

Changes in operating assets and liabilities, net of acquisitions:

Accounts (184,720) (299,530) (83,101) (199,858) receivable

Inventories (84,163) (39,530) (207,921) (25,830)

Other current 44,328 136,870 (41,651) (51,746) assets

Accounts payable and 212,836 283,853 77,021 144,953 accrued expenses

Net cash provided byoperating activities 211,215 261,257 432,941 248,414from continuingoperations

Net cash provided byoperating activities - 75 - 648from discontinuedoperations

Net cash provided by 211,215 261,332 432,941 249,062operating activities

Cash flows from investing activities:

Purchases of fixed (16,894) (7,211) (48,706) (37,799) assets

Payments related to equity investments and business acquisitions,

net of cash (119,713) (14,483) (415,365) (52,208) acquired

Proceeds from sale of 9,757 - 9,757 12,000 equity investments

Proceeds from (payments for) loan (3,959) 278 (5,980) (1,451) to affiliate

Other (7,073) (2,899) (18,707) (14,498)

Net cash used ininvesting activities (137,882) (24,315) (479,001) (93,956)from continuingoperations

Net cash used ininvesting activities - - - -from discontinuedoperations

Net cash used in (137,882) (24,315) (479,001) (93,956)investing activities

Cash flows from financing activities:

Net change in bank (7,747) 4,437 (13,128) 484,139 borrowings

Proceeds from issuance of long-term - - 200,000 501,421 debt

Principal payments (1,509) (877) (121,835) (610,457) for long-term debt

Debt issuance costs (1,814) (28) (2,013) (3,683)

Debt extinguishment - (401) - (401) costs

Payments for repurchases and (50,000) - (251,211) (73,789) retirement of common stock

Payments for taxes related to shares (13) (294) (7,372) (14,007) withheld for employee taxes

Distributions to noncontrolling (4,833) (529) (8,622) (3,995) shareholders

Acquisitions of noncontrolling (49,162) - (50,292) (14,934) interests in subsidiaries

Proceeds from Henry Schein Animal Health - 75 - 139 Business

Net cash provided by(used in) financing (115,078) 2,383 (254,473) 264,433activities fromcontinuing operations

Net cash used infinancing activities - (75) - (648)from discontinuedoperations

Net cash provided by(used in) financing (115,078) 2,308 (254,473) 263,785activities



Effect of exchange ratechanges on cash and cash equivalents from

continuing operations (6,350) (1,940) (1,519) 8,507

Effect of exchange ratechanges on cash and cash equivalents from

discontinued - - - - operations

Net change in cash andcash equivalents from (48,095) 237,385 (302,052) 427,398continuing operations

Net change in cash andcash equivalents from - - - -discontinued operations

Cash and cashequivalents, beginning 167,228 296,110 421,185 106,097of period

Cash and cashequivalents, end of $ 119,133 $ 533,495 $ 119,133 $ 533,495period

Exhibit A - Third Quarter Sales

Henry Schein, Inc.

2021 Third Quarter

Sales Summary

(in thousands)

(unaudited)

Q3 2021 over Q3 2020

Global

Q3 2021

Q3 2020

Total Sales Growth

Foreign Exchange Growth

Local Currency Growth

Acquisition Growth

Local Internal Growth

Dental Merchandise

$

1,417,742

$

1,300,379

9.0%

1.4%

7.6%

4.7%

2.9%

Dental Equipment

405,152

349,474

15.9%

1.3%

14.6%

0.7%

13.9%

Total Dental

1,822,894

1,649,853

10.5%

1.4%

9.1%

3.9%

5.2%

Medical

1,186,812

1,027,146

15.5%

0.0%

15.5%

2.4%

13.1%

Total Health Care Distribution

3,009,706

2,676,999

12.4%

0.8%

11.6%

3.4%

8.2%

Technology and value-added services

168,609

138,355

21.9%

0.9%

21.0%

14.7%

6.3%

Total excluding Corporate TSA Revenue

3,178,315

2,815,354

12.9%

0.9%

12.0%

3.9%

8.1%

Corporate TSA revenues (1)

-

24,792

n/a

n/a

n/a

n/a

n/a

Total Global

$

3,178,315

$

2,840,146

11.9%

0.8%

11.1%

3.9%

7.2%

North America

Q3 2021

Q3 2020

Total SalesGrowth

Foreign Exchange Growth

Local Currency Growth

Acquisition Growth

Local Internal Growth

Dental Merchandise

$

878,286

$

791,107

11.0%

0.4%

10.6%

6.7%

3.9%

Dental Equipment

236,345

217,729

8.6%

0.8%

7.8%

0.0%

7.8%

Total Dental

1,114,631

1,008,836

10.5%

0.5%

10.0%

5.3%

4.7%

Medical

1,163,799

1,002,741

16.1%

0.0%

16.1%

2.5%

13.6%

Total Health Care Distribution

2,278,430

2,011,577

13.3%

0.3%

13.0%

3.9%

9.1%

Technology and value-added services

147,644

120,949

22.1%

0.2%

21.9%

16.9%

5.0%

Total excluding Corporate TSA Revenue

2,426,074

2,132,526

13.8%

0.3%

13.5%

4.6%

8.9%

Corporate TSA revenues (1)

-

-

n/a

n/a

n/a

n/a

n/a

Total North America

$

2,426,074

$

2,132,526

13.8%

0.3%

13.5%

4.6%

8.9%

International

Q3 2021

Q3 2020

Total Sales Growth

Foreign Exchange Growth

Local Currency Growth

Acquisition Growth

Local Internal Growth

Dental Merchandise

$

539,456

$

509,272

5.9%

2.8%

3.1%

1.8%

1.3%

Dental Equipment

168,807

131,745

28.1%

2.2%

25.9%

2.0%

23.9%

Total Dental

708,263

641,017

10.5%

2.7%

7.8%

1.9%

5.9%

Medical

23,013

24,405

-5.7%

1.8%

-7.5%

0.0%

-7.5%

Total Health Care Distribution

731,276

665,422

9.9%

2.7%

7.2%

1.7%

5.5%

Technology and value-added services

20,965

17,406

20.4%

5.1%

15.3%

0.0%

15.3%

Total excluding Corporate TSA Revenue

752,241

682,828

10.2%

2.8%

7.4%

1.7%

5.7%

Corporate TSA revenues (1)

-

24,792

n/a

n/a

n/a

n/a

n/a

Total International

$

752,241

$

707,620

6.3%

2.6%

3.7%

1.7%

2.0%

(1) Corporate TSA revenues represents sales of certain products to Covetrus under the transition services agreement entered into in connection with the Animal Health spin-off, which ended in December 2020.

Exhibit A - Third Quarter Sales



Henry Schein, Inc.

2021 Third Quarter

Sales Summary

(in thousands)

(unaudited)

Q3 2021 over Q3 2020



Total Foreign Local Acquisition LocalGlobal Q3 2021 Q3 2020 Sales Exchange Currency Growth Internal Growth Growth Growth Growth

Dental $ 1,417,742 $ 1,300,379 9.0% 1.4% 7.6% 4.7% 2.9%Merchandise

Dental 405,152 349,474 15.9% 1.3% 14.6% 0.7% 13.9%Equipment

Total Dental 1,822,894 1,649,853 10.5% 1.4% 9.1% 3.9% 5.2%



Medical 1,186,812 1,027,146 15.5% 0.0% 15.5% 2.4% 13.1%

Total HealthCare 3,009,706 2,676,999 12.4% 0.8% 11.6% 3.4% 8.2%Distribution



Technologyand 168,609 138,355 21.9% 0.9% 21.0% 14.7% 6.3%value-addedservices

Totalexcluding 3,178,315 2,815,354 12.9% 0.9% 12.0% 3.9% 8.1%Corporate TSARevenue

Corporate TSA - 24,792 n/a n/a n/a n/a n/arevenues (1)

Total Global $ 3,178,315 $ 2,840,146 11.9% 0.8% 11.1% 3.9% 7.2%

Total Foreign Local Acquisition LocalNorth America Q3 2021 Q3 2020 Sales Exchange Currency Growth Internal Growth Growth Growth Growth



Dental $ 878,286 $ 791,107 11.0% 0.4% 10.6% 6.7% 3.9%Merchandise

Dental 236,345 217,729 8.6% 0.8% 7.8% 0.0% 7.8%Equipment

Total Dental 1,114,631 1,008,836 10.5% 0.5% 10.0% 5.3% 4.7%



Medical 1,163,799 1,002,741 16.1% 0.0% 16.1% 2.5% 13.6%

Total HealthCare 2,278,430 2,011,577 13.3% 0.3% 13.0% 3.9% 9.1%Distribution



Technologyand 147,644 120,949 22.1% 0.2% 21.9% 16.9% 5.0%value-addedservices

Totalexcluding 2,426,074 2,132,526 13.8% 0.3% 13.5% 4.6% 8.9%Corporate TSARevenue



Corporate TSA - - n/a n/a n/a n/a n/arevenues (1)

Total North $ 2,426,074 $ 2,132,526 13.8% 0.3% 13.5% 4.6% 8.9%America



Total Foreign Local Acquisition LocalInternational Q3 2021 Q3 2020 Sales Exchange Currency Growth Internal Growth Growth Growth Growth



Dental $ 539,456 $ 509,272 5.9% 2.8% 3.1% 1.8% 1.3%Merchandise

Dental 168,807 131,745 28.1% 2.2% 25.9% 2.0% 23.9%Equipment

Total Dental 708,263 641,017 10.5% 2.7% 7.8% 1.9% 5.9%



Medical 23,013 24,405 -5.7% 1.8% -7.5% 0.0% -7.5%

Total HealthCare 731,276 665,422 9.9% 2.7% 7.2% 1.7% 5.5%Distribution



Technologyand 20,965 17,406 20.4% 5.1% 15.3% 0.0% 15.3%value-addedservices

Totalexcluding 752,241 682,828 10.2% 2.8% 7.4% 1.7% 5.7%Corporate TSARevenue



Corporate TSA - 24,792 n/a n/a n/a n/a n/arevenues (1)

Total $ 752,241 $ 707,620 6.3% 2.6% 3.7% 1.7% 2.0%International





(1) Corporate TSA revenues represents sales of certain products to Covetrusunder the transition services agreement entered into in connection with theAnimal Health spin-off, which ended in December 2020.



Exhibit A - Year-to-Date Sales

Henry Schein, Inc.

2021 Third Quarter Year-to-Date

Sales Summary

(in thousands)

(unaudited)

Q3 2021 Year-to-Date over Q3 2020 Year-to-Date

Global

Q3 2021

Q3 2020

Total Sales Growth

Foreign Exchange Growth

Local Currency Growth

Acquisition Growth

Local Internal Growth

Dental Merchandise

$

4,344,933

$

3,194,015

36.0%

3.6%

32.4%

5.9%

26.5%

Dental Equipment

1,177,233

872,206

35.0%

4.5%

30.5%

0.7%

29.8%

Total Dental

5,522,166

4,066,221

35.8%

3.8%

32.0%

4.8%

27.2%

Medical

3,084,677

2,445,644

26.1%

0.2%

25.9%

2.2%

23.7%

Total Health Care Distribution

8,606,843

6,511,865

32.2%

2.5%

29.7%

3.8%

25.9%

Technology and value-added services

463,656

375,547

23.5%

1.6%

21.9%

9.0%

12.9%

Total excluding Corporate TSA Revenue

9,070,499

6,887,412

31.7%

2.4%

29.3%

4.1%

25.2%

Corporate TSA revenues (1)

-

66,004

n/a

n/a

n/a

n/a

n/a

Total Global

$

9,070,499

$

6,953,416

30.4%

2.3%

28.1%

4.1%

24.0%

North America

Q3 2021

Q3 2020

Total Sales Growth

Foreign Exchange Growth

Local Currency Growth

Acquisition Growth

Local Internal Growth

Dental Merchandise

$

2,612,142

$

1,894,097

37.9%

0.8%

37.1%

8.6%

28.5%

Dental Equipment

674,879

519,057

30.0%

1.4%

28.6%

0.0%

28.6%

Total Dental

3,287,021

2,413,154

36.2%

0.9%

35.3%

6.8%

28.5%

Medical

3,006,699

2,377,357

26.5%

0.0%

26.5%

2.3%

24.2%

Total Health Care Distribution

6,293,720

4,790,511

31.4%

0.5%

30.9%

4.5%

26.4%

Technology and value-added services

399,478

327,374

22.0%

0.2%

21.8%

10.0%

11.8%

Total excluding Corporate TSA Revenue

6,693,198

5,117,885

30.8%

0.5%

30.3%

4.9%

25.4%

Corporate TSA revenues (1)

-

-

n/a

n/a

n/a

n/a

n/a

Total North America

$

6,693,198

$

5,117,885

30.8%

0.5%

30.3%

4.9%

25.4%

International

Q3 2021

Q3 2020

Total Sales Growth

Foreign Exchange Growth

Local Currency Growth

Acquisition Growth

Local Internal Growth

Dental Merchandise

$

1,732,791

$

1,299,918

33.3%

7.7%

25.6%

1.9%

23.7%

Dental Equipment

502,354

353,149

42.2%

8.9%

33.3%

1.8%

31.5%

Total Dental

2,235,145

1,653,067

35.2%

7.9%

27.3%

2.0%

25.3%

Medical

77,978

68,287

14.2%

7.8%

6.4%

0.0%

6.4%

Total Health Care Distribution

2,313,123

1,721,354

34.4%

8.0%

26.4%

1.8%

24.6%

Technology and value-added services

64,178

48,173

33.2%

10.1%

23.1%

3.3%

19.8%

Total excluding Corporate TSA Revenue

2,377,301

1,769,527

34.3%

8.0%

26.3%

1.8%

24.5%

Corporate TSA revenues (1)

-

66,004

n/a

n/a

n/a

n/a

n/a

Total International

$

2,377,301

$

1,835,531

29.5%

7.7%

21.8%

1.8%

20.0%

(1) Corporate TSA revenues represents sales of certain animal health products to Covetrus under the transition services agreement entered into in connection with the Animal Health Spin-off, which ended in December 2020.

Exhibit A - Year-to-Date Sales



Henry Schein, Inc.

2021 Third Quarter Year-to-Date

Sales Summary

(in thousands)

(unaudited)



Q3 2021 Year-to-Date over Q3 2020 Year-to-Date



Total Foreign Local Acquisition LocalGlobal Q3 2021 Q3 2020 Sales Exchange Currency Growth Internal Growth Growth Growth Growth



Dental $ 4,344,933 $ 3,194,015 36.0% 3.6% 32.4% 5.9% 26.5%Merchandise

Dental 1,177,233 872,206 35.0% 4.5% 30.5% 0.7% 29.8%Equipment

Total Dental 5,522,166 4,066,221 35.8% 3.8% 32.0% 4.8% 27.2%



Medical 3,084,677 2,445,644 26.1% 0.2% 25.9% 2.2% 23.7%

Total HealthCare 8,606,843 6,511,865 32.2% 2.5% 29.7% 3.8% 25.9%Distribution



Technologyand 463,656 375,547 23.5% 1.6% 21.9% 9.0% 12.9%value-addedservices

Totalexcluding 9,070,499 6,887,412 31.7% 2.4% 29.3% 4.1% 25.2%Corporate TSARevenue



Corporate TSA - 66,004 n/a n/a n/a n/a n/arevenues (1)

Total Global $ 9,070,499 $ 6,953,416 30.4% 2.3% 28.1% 4.1% 24.0%

Total Foreign Local Acquisition LocalNorth America Q3 2021 Q3 2020 Sales Exchange Currency Growth Internal Growth Growth Growth Growth



Dental $ 2,612,142 $ 1,894,097 37.9% 0.8% 37.1% 8.6% 28.5%Merchandise

Dental 674,879 519,057 30.0% 1.4% 28.6% 0.0% 28.6%Equipment

Total Dental 3,287,021 2,413,154 36.2% 0.9% 35.3% 6.8% 28.5%



Medical 3,006,699 2,377,357 26.5% 0.0% 26.5% 2.3% 24.2%

Total HealthCare 6,293,720 4,790,511 31.4% 0.5% 30.9% 4.5% 26.4%Distribution



Technologyand 399,478 327,374 22.0% 0.2% 21.8% 10.0% 11.8%value-addedservices

Totalexcluding 6,693,198 5,117,885 30.8% 0.5% 30.3% 4.9% 25.4%Corporate TSARevenue



Corporate TSA - - n/a n/a n/a n/a n/arevenues (1)



Total North $ 6,693,198 $ 5,117,885 30.8% 0.5% 30.3% 4.9% 25.4%America



Total Foreign Local Acquisition LocalInternational Q3 2021 Q3 2020 Sales Exchange Currency Growth Internal Growth Growth Growth Growth



Dental $ 1,732,791 $ 1,299,918 33.3% 7.7% 25.6% 1.9% 23.7%Merchandise

Dental 502,354 353,149 42.2% 8.9% 33.3% 1.8% 31.5%Equipment

Total Dental 2,235,145 1,653,067 35.2% 7.9% 27.3% 2.0% 25.3%



Medical 77,978 68,287 14.2% 7.8% 6.4% 0.0% 6.4%

Total HealthCare 2,313,123 1,721,354 34.4% 8.0% 26.4% 1.8% 24.6%Distribution



Technologyand 64,178 48,173 33.2% 10.1% 23.1% 3.3% 19.8%value-addedservices

Totalexcluding 2,377,301 1,769,527 34.3% 8.0% 26.3% 1.8% 24.5%Corporate TSARevenue



Corporate TSA - 66,004 n/a n/a n/a n/a n/arevenues (1)

Total $ 2,377,301 $ 1,835,531 29.5% 7.7% 21.8% 1.8% 20.0%International



(1) Corporate TSA revenues represents sales of certain animal health productsto Covetrus under the transition services agreement entered into in connectionwith the Animal Health Spin-off, which ended in December 2020.

Exhibit B

Henry Schein, Inc.

2021 Third Quarter and Year-to-Date

Reconciliation of reported GAAP net income from continuing operations and

diluted EPS from continuing operations attributable to Henry Schein, Inc.

to non-GAAP net income from continuing operations and

diluted EPS from continuing operations attributable to Henry Schein, Inc.

(in thousands, except per share data)

(unaudited)

Third Quarter

Year-to-Date

%

%

2021

2020

Growth

2021

2020

Growth

Net income from continuing operations attributable to Henry Schein, Inc.

$

162,286

$

141,726

14.5

%

$

483,999

$

260,887

85.5

%

Diluted EPS from continuing operations attributable to Henry Schein, Inc.

$

1.15

$

0.99

16.2

%

$

3.40

$

1.82

86.8

%

Non-GAAP Adjustments

Restructuring costs (credits) -Pre-tax (1)

$

(175)

$

6,992

$

3,360

$

27,713

Income tax expense (benefit) for restructuring costs (1)

44

(1,748)

(840)

(6,928)

Settlement and litigation costs - Pre-tax (2)

-

-

14,253

-

Income tax benefit for settlement and litigation costs (2)

-

-

(3,548)

-

Gain on sale of equity investment (3)

(7,318)

-

(7,318)

-

Total non-GAAP adjustments to net income from continuing operations

$

(7,449)

$

5,244

$

5,907

$

20,785

Non-GAAP adjustments to diluted EPS from continuing operations

(0.05)

0.04

0.04

0.15

Non-GAAP net income from continuing operations attributable to Henry Schein, Inc.

$

154,837

$

146,970

5.4

%

$

489,906

$

281,672

73.9

%

Non-GAAP diluted EPS from continuing operations attributable to Henry Schein, Inc.

$

1.10

$

1.03

6.8

%

$

3.45

$

1.97

75.1

%

Management believes that non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance and allow for greater transparency with respect to key metrics used by management in operating our business. These non-GAAP financial measures are presented solely for informational and comparative purposes and should not be regarded as a replacement for corresponding, similarly captioned, GAAP measures. Earnings per share numbers may not sum due to rounding.



Exhibit B



Henry Schein, Inc.

2021 Third Quarter and Year-to-Date

Reconciliation of reported GAAP net income from continuing operations and

diluted EPS from continuing operations attributable to Henry Schein, Inc.

to non-GAAP net income from continuing operations and

diluted EPS from continuing operations attributable to Henry Schein, Inc.

(in thousands, except per share data)

(unaudited)

Third Quarter Year-to-Date

% %

2021 2020 Growth 2021 2020 Growth

Net incomefromcontinuingoperations $ 162,286 $ 141,726 14.5 % $ 483,999 $ 260,887 85.5 %attributableto HenrySchein, Inc.

Diluted EPSfromcontinuingoperations $ 1.15 $ 0.99 16.2 % $ 3.40 $ 1.82 86.8 %attributableto HenrySchein, Inc.



Non-GAAP Adjustments

Restructuringcosts $ (175) $ 6,992 $ 3,360 $ 27,713 (credits)-Pre-tax (1)

Income taxexpense(benefit) for 44 (1,748) (840) (6,928) restructuringcosts (1)

Settlementandlitigation - - 14,253 - costs -Pre-tax (2)

Income taxbenefit forsettlement - - (3,548) - andlitigationcosts (2)

Gain on saleof equity (7,318) - (7,318) - investment(3)

Totalnon-GAAPadjustmentsto net income $ (7,449) $ 5,244 $ 5,907 $ 20,785 fromcontinuingoperations



Non-GAAPadjustmentsto diluted (0.05) 0.04 0.04 0.15 EPS fromcontinuingoperations



Non-GAAP netincome fromcontinuingoperations $ 154,837 $ 146,970 5.4 % $ 489,906 $ 281,672 73.9 %attributableto HenrySchein, Inc.

Non-GAAPdiluted EPSfromcontinuing $ 1.10 $ 1.03 6.8 % $ 3.45 $ 1.97 75.1 %operationsattributableto HenrySchein, Inc.

Management believes that non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance and allow for greater transparency with respect to key metrics used by management in operating our business. These non-GAAP financial measures are presented solely for informational and comparative purposes and should not be regarded as a replacement for corresponding, similarly captioned, GAAP measures. Earnings per share numbers may not sum due to rounding.

Represents Q3 2021 restructuring credits of $175, net of $44 tax expense, resulting in an after-tax effect of $131, and YTD 2021 restructuring costs of $3,360, net of $840 tax benefit, resulting in an after-tax(1) effect of $2,520. Represents Q3 2020 restructuring costs of $6,992, net of $1,748 tax benefit, resulting in an after-tax effect of $5,244, and YTD 2020 restructuring costs of $27,713, net of $6,928 tax benefit, resulting in an after-tax effect of $20,785.

Represents a YTD 2021 pre-tax charge of $15,750, net of $1,497 of(2) noncontrolling interests, related to settlement and litigation costs, net of a tax benefit of $3,548, resulting in a net after-tax charge of $10,705.

In the third quarter of 2021 we received contingent proceeds of $9.8(3) million from the 2019 sale of Hu-Friedy resulting in the recognition of an additional after-tax gain of $7.3 million.

View source version on businesswire.com: https://www.businesswire.com/news/home/20211102005636/en/

CONTACT: Investors Steven Paladino Executive Vice President and Chief Financial Officer steven.paladino@henryschein.com (631) 843-5500

CONTACT: Graham Stanley Vice President, Investor Relations and Strategic Financial Project Officer graham.stanley@henryschein.com (631) 843-5963

CONTACT: Media Ann Marie Gothard Vice President, Global Corporate Media Relations annmarie.gothard@henryschein.com (631) 390-8169