UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) September 28, 2004
STERIS Corporation
(Exact name of registrant as specified in its charter)
| Ohio | 0-20165 | 34-1482024 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
| 5960 Heisley Road, Mentor, Ohio | 44060-1834 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code (440) 354-2600
Not Applicable
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
ITEM 7.01 Regulation FD Disclosures
Attached hereto as Exhibit 99.1 is a copy of materials dated September 28, 2004 and prepared with respect to a presentation at the UBS Global Life Sciences Conference that is being made by senior management of STERIS Corporation on September 28, 2004.
The information contained in this Current Report on Form 8-K, including the exhibit attached hereto, is being furnished to the Securities and Exchange Commission and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. Furthermore, the information contained in this Current Report on Form 8-K shall not be deemed to be incorporated by reference into any registration statement or other document filed pursuant to the Securities Act of 1933, as amended.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| STERIS CORPORATION | ||
| By: |
/s/ Mark D. McGinley | |
| Mark D. McGinley Vice President, General Counsel and Secretary | ||
Dated: September 28, 2004
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Exhibit 99.1
UBS Global Life Sciences Conference
September 28, 2004
Forward-Looking Statements
Except for historical information discussed, today’s presentation includes forward-looking statements that involve risks and uncertainties. Investors are cautioned that such statements are only predictions and that actual events or results may differ materially. Some of the factors which could cause actual results to materially differ from those anticipated by the forward-looking statements are set forth in the Company’s latest SEC Filings on Forms 10-K and 10-Q and in its earnings release dated July 27, 2004. Further, these forward-looking statements speak only as of this date September 28, 2004. We undertake no obligation to publicly release the results of any revisions to the forward-looking statements made today to reflect events or circumstances after today or to reflect the occurrence of unanticipated events.
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Agenda
Business Overview Investment Considerations Strategic Direction Recent Results
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Business Overview
The STERIS Path to Growth
INITIAL GROWTH
ACQUISITIONS
REORGANIZATION
STERIS Today
Leader in Technologies to Control Infection and Contamination
Positioned For Growth
STERIS 2000
STERIS 1995
1987 Start up
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Sales by Business Segment
Fiscal Year Ended March 31, 2004 (Dollars in millions)
HEALTHCARE ($753) LIFE SCIENCES ($246) STERIS ISOMEDIX SERVICES ($88)
69%
23%
8%
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Key Industries Served
HEALTHCARE
Surgical Support Sterile Processing Applied Infection Control
LIFE SCIENCES
Pharmaceutical Production Research Defense and Industrial
STERIS ISOMEDIX SERVICES (CONTRACT STERILIZATION)
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Investment Considerations
Investment Considerations
A technology leader
Diversified and recurring revenue stream Strong competitive positions Strong financial and operating platform Improving market dynamics
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A Technology Leader
Broad based technologies…
Surface Cleaning Chemistries
Washing Systems
Skin Care
VHP ® Sterilization
Steam Sterilization
EtO Sterilization
Peracetic Acid Sterilization
Gamma
Delivered through capital equipment chemistries and services…
Make STERIS a leader
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Diversified and Recurring Revenue Stream
Capital equipment drives… Consumables… and Services…
51% of fiscal 2004 revenues were higher margin, recurring consumables and services
STERIS has the unique ability to offer a custom solution for a variety of customers, industries and geographies
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Strong Competitive Positions
Leading supplier of sterilization and surgical support products to U.S. healthcare facilities Leading position in contract sterilization for medical technology manufacturers and other industries Leading supplier of equipment and chemistries to biopharmaceutical companies for research and production facilities STERIS has the broadest range of infection control technologies, products and services in the world STERIS has the unique capability to offer custom solutions to a variety of industries
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Strong Financial and Operating Platform
Consistent earnings growth Low level of debt Strong cash flow Efficient operations
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Improving Market Dynamics
Aging population is driving demand for healthcare services and pharmaceuticals Increased spending by hospitals is leading to expansion and upgrading of facilities Ongoing investment in drug production is driving manufacturing capacity and research facilities Global awareness of infection control is growing
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Strategic Direction
Sources of Growth
Earnings Power
EXTERNAL
Improving market dynamics
INTERNAL
Strategic Actions to Drive Growth and Financials
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Our Growth Strategy
Diversify revenue stream by product, service, market and geography
Increase recurring revenues Leverage our channel Introduce new technologies Adapt our technologies Expand internationally
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Increase Recurring Revenues
Large revenue opportunity in our own installed base
Capture consumable opportunity
Aggressively grow service
New capital equipment products will have an associated proprietary consumable Greater penetration of chemistries in Life Sciences
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Leverage Our Channel in Healthcare
Presence in every U.S. hospital Sales force of 250 people Service force of 1,000 New products, alliances, acquisitions
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Introduce New Technologies
R&D spending to approximate $35 million in fiscal 2005, an increase of over 20% Focused new product development effort Areas of focus include projects for new industries and new sterilization technologies
VHP® technology advancement into new product uses Prion Decontamination Targeted sterile processing offering
Key new products for general infection control and surgical support
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New Product - Reliance® EPS
Submitted to FDA for 510k Approval Available for sale in Europe and Canada
STERIS’s first high level disinfection system for flexible endoscopes in GI Suite Can process two instruments simultaneously Addresses key market needs in GI suite Guaranteed consumable revenue stream
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Adapt Our Technologies
CURRENT
Exploring new applications related to Anthrax contamination
Joint research on defense applications for biological and chemical warfare
Joint research in space applications
FUTURE POSSIBILITIES
Transportation
Hotel and building decontamination
Food and beverage packaging
Medical device sterilization
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Adapt Our Technologies – Key Application
Decontamination of State Department building SA32 mail processing facility.
Used STERIS proprietary technology, equipment and expertise First validated process for treating anthrax contaminated buildings
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International Expansion Opportunities
REVENUE MIX BY GEOGRAPHY
Fiscal Year 2004
United States 77%
International 23%
Market size is equivalent to U.S. Narrowed focus on key European countries and Japan Acquisitions to play strategic role Leading-edge technologies
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Acquisition of Albert Browne, U.K.
European market leader in chemical indicators 2003 revenues approximately $16 million $51.6 million acquisition price financed with existing cash Fits consumable and international strategy
High margin consumable business International channel Superior technology
Expected to add $0.01 to $0.02 in fiscal 2006
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Recent Results
Net Quarterly Revenues
(dollars in millions) $300 $250 $200 $150 $100 $50
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
FY2001 FY2002 FY2003 FY2004 FY2005
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Quarterly Diluted Earnings Per Share $0.40 $0.35 $0.30 $0.25 $0.20 $0.15 $0.10 $0.05 $0.00
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr
FY2001 FY2002 FY2003 FY2004 FY2005
* A charge in the fourth quarter of fiscal 2001 resulted in a loss of $0.24 per share
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Strong Cash Flow
Cash From Operations and Capital Spending
(In millions) $102.3 $51.0 $142.0 $65.7 $133.3 $58.6 $123.3 $67.6
FY 2001 FY 2002 FY 2003 FY 2004
Cash from Operations Capital Spending
Cash Priorities:
Fund growth through acquisitions Modest share buy backs to offset dilutive impact of options Allows substantial flexibility for growth
Recent Cash Uses: $31.5 million in share buybacks (through 8/6/04) $51.6 million for acquisition of Albert Browne
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Second Quarter Earnings Outlook Revised
Today announced revised earnings outlook for fiscal 2005 2nd quarter based upon a review of business trends and results:
5-6% overall revenue growth expected
Earnings expected to be in the range of $0.27 to $0.28 per diluted share
Key Notes:
Lower than anticipated results in Life Sciences (LS)
Lower international profitability, driven by LS, leading to increased tax rate to 37.5% Healthcare - demand for capital equipment solid Isomedix - strong revenue growth anticpated
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Summary
A technology leader with strong competitive positions Diversified and recurring revenue stream Improving market dynamics Financial flexibility Bright future
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