Bausch & Lomb 1999 Annual Report

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diseases like age-related macular degeneration, diabetic macular edema and posterior uveitis that attack the retina and optic nerve or “back of the eye.” The results from our clinical trials so far are very promising, and we expect to move into Phase III clinicals during 2000 and be on the market potentially as early as 2003. While we continue to develop the technology, operational capabilities and financial strength necessary to achieve our ambitions, it is the tenacity and dedication of our people that will ultimately power our success. We are confident that the future of this company is bright because of the dedication of our past and present employees. We are grateful to these men and women for their efforts, which not only have made Bausch & Lomb the company it is today, but the company it will be in this new millennium. They have allowed us to build our strong technological leadership and global presence, driven our efforts in R&D and provided unique opportunities to integrate and leverage our broad product portfolio. We have the people, the products and the capabilities to continue to lead this category of healthcare and bring the joy of sight to millions of people in the years ahead. “We are meeting that challenge” See the future 8 Bausch & Lomb William M. Carpenter Chairman and Chief Executive Officer
Financial Review Dollar Amounts In Millions – Except Per Share Data This financial review, which should be read in conjunction with the accompanying financial statements, contains management’s discussion and analysis of the company’s results of operations, liquidity and 2000 outlook. References within this financial review to earnings per share refer to diluted earnings per share. Bausch & Lomb Incorporated (the “company”) reported net income of $445 or $7.59 per share for the year ended December 25, 1999, compared to 1998 net income of $25 or $0.45 per share. During 1999, the company sold its sunglass, hearing aid and biomedical businesses, which generated an aggregate aftertax gain of $308 or $5.26 per share. Income from continuing operations was $103 or $1.75 per share in 1999 compared to $56 or $0.99 per share in 1998. Restructuring charges and asset write-offs recorded in the fourth quarter of 1999, partially offset by reversals of restructuring charges recorded in prior periods, reduced 1999 income from continuing operations by $34 or $0.58 per share after taxes. Purchase accounting adjustments related to the surgical acquisitions, as well as restructuring charges and asset write-offs, reduced 1998 income from continuing operations by $49 or $0.87 per share after taxes. In 1997, net income and income from continuing operations were $49 or $0.89 per share and $62 or $1.12 per share, respectively. Results were negatively impacted by restructuring charges and asset write-offs of $25 or $0.45 per share after taxes and a litigation charge of $13 or $0.24 per share after taxes. See the future 9 Bausch & Lomb Revenues And Earnings By Business Segment The company split the pharmaceuticals/surgical segment into two separate segments in 1999 to reflect changes in the manner in which financial information is viewed by management for decision-making purposes. The company now reports its operating results in three segments: vision care, pharmaceuticals and surgical. The vision care segment includes contact lenses, lens care products and vision accessories. The pharmaceuticals segment includes prescription ophthalmic drugs and over-the-counter (OTC) medications. The surgical segment is comprised of cataract, refractive and other ophthalmic surgery products. Prior year results have been reclassified to reflect these new segment classifications. The following table summarizes continuing sales and earnings by segment and presents total company operating earnings. Throughout the remainder of this financial review, the term “other significant charges” will be used to refer to purchased in-process research and development and other required purchase accounting adjustments recorded in 1998 associated with the surgical acquisitions. 1999 1998 1997 As % of Total As % of Total As % of Total Reported Net Sales Reported Net Sales Reported Net Sales Net Sales Vision Care $ 1,029.5 58% $ 971.2 61% $ 918.1 83% Pharmaceuticals 293.9 17% 241.6 15% 190.6 17% Surgical 432.7 25% 384.7 24% .– – $ 1,756.1 $ 1,597.5 $ 1,108.7 % of Segment % of Segment % of Segment Earnings Earnings Earnings Operating Earnings Vision Care $ 200.5 61% $ 208.4 70% $ 210.9 85% Pharmaceuticals 66.1 20% 49.2 16% 36.6 15% Surgical 64.1 19% 43.0 14% .– – $ 330.7 $ 300.6 $ 247.5 Corporate administration Restructuring charges and (63.0) (52.6) (45.5) asset write-offs (53.5) (5.4) (39.1) Other significant charges .– (73.1) .– $ 214.2 $ 169.5 $ 162.9
Page 1 and 2: “See the future” Bausch & Lomb
Page 3 and 4: At a Glance Key Products Vision Car
Page 5 and 6: Dear Fellow Shareholders: We entere
Page 7 and 8: Increased R&D Driving Revenue Growt
Page 9 and 10: 20/10 vision can be realized sooner
Page 11: The tiny Vitrasert implant pictured
Page 15 and 16: costs by streamlining functions and
Page 17 and 18: 1999 Versus 1998 Sales in markets o
Page 19 and 20: Working Capital Working capital and
Page 21 and 22: Information Concerning Forward-Look
Page 23 and 24: Statements Of Income For The Years
Page 25 and 26: Statements Of Cash Flows For The Ye
Page 27 and 28: Notes To Financial Statements Dolla
Page 29 and 30: accepted accounting principles to r
Page 31 and 32: The costs of employee terminations
Page 33 and 34: 5. Restructuring Charges And Asset
Page 35 and 36: Business Segment The following tabl
Page 37 and 38: 8. Other Short- And Long-Term Inves
Page 39 and 40: Reconciliations of the statutory U.
Page 41 and 42: Interest rate swap agreements on lo
Page 43 and 44: For amounts pertaining to postretir
Page 45 and 46: See the future 41 Bausch & Lomb 199
Page 47 and 48: Quarterly Stock Prices (unaudited)
Page 49 and 50: Report Of Independent Accountants T
Page 51: Corporate Information Internet Addr

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