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Bergen Brunswig Corp., ORANGE

December 23, 1991|Researched by DALLAS M. JACKSON / Los Angeles Times

Nature of Business: Distributor of pharmaceuticals and prerecorded videocassette.

Total Employees: 3,656

In Orange County: 630

Stock Listing in The Times: On Amex as "BergBr"

Ticker Symbol: "BBC"

Friday's Close: $16.88

One-Week Change: Down $0.12

Analyst Review: "Bergen Brunswig is in excellent financial shape. At the end of fiscal '91, they had $300 million in cash. This company isn't really affected by the recession. What is impacting them adversely is the profit margin squeeze in the wholesale drug industry. Drug prices which had been increasing by 7% to 9% yearly, have slowed to around 5% to 6% this year. At the same time there is a price war going on within the industry so the profit margins have been squeezed even further. This current squeeze might last another six to 12 months. The big thing that hit them in the first quarter was bad debts--and that doesn't happen every quarter. Bergen is likely to continue to grow on the wholesale drug side by 11% to 12%, and that's without acquisitions. But there is a good chance they could double in size within five years, assuming they make a couple reasonably-sized acquisitions. We recommend the stock despite the fact the profit squeeze will be a little rocky for the next couple of quarters; the current stock price negates that concern." --Donald T. Spindel, analyst, A.G. Edwards & Sons, Inc., St. Louis


Fiscal year ending Aug. 31 Aug. 31 Aug. 31 1 Qtr. 1 Qtr. 1989 1990 1991 1991 1992 Net Sales (BILLIONS) $3,923 $4,442 $4,838 $1,182 $1,305 Net Profit (Loss) $47.6 $66.1 $64.1 $17.0 $9.0

Corporate Outlook: "First-quarter results were a combination of economic, political and competitive conditions that bought pressure on our sales growth, margins and profits. But our sales are ahead of last year and our company is in excellent financial condition with substantial working capital available for future growth opportunities. We continually are driven to improve our market share through internal growth, start-up operations and acquisitions, and we are pursuing all three."--Robert E. Martini, president/CEO


Fiscal year ending Aug. 31 Aug. 31 Aug. 31 1 Qtr. 1 Qtr. 1989 1990 1991 1991 1991 52-Week High $21.60 $23.70 $26.20 $21.59 $23.13 52-Week Low $12.16 $17.20 $17.09 $17.09 $17.00 Book Value Per Share $9.18 $10.42 $10.89 $9.03 $8.43 Price Per Share $21.30 $18.50 $21.80 $21.41 $17.38 Net Earnings (Loss) Per Share $1.33 $1.47 $1.44 $0.37 $0.22 Price-to-Earnings Ratio 12:1 13:1 15:1 14:1 20:1 Avg. Return on Investor Equity 16% 15% 14% 15% 10%

Source: Bergen Brunswig Corp. For more information call or write, Bergen Brunswig Corp.: 4000 Metropolitan Drive, Orange, Calif., 92668. (714) 385-4000

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