1. Focused
Celebrating
On Our Future.
Our History.
75 Y E A R S O F S U C C E S S • A N N U A L R E P O R T 2 0 0 6

2. ABOUT HENRY SCHEIN
Henry Schein, a FORTUNE 500® company, is the largest The Company operates through a centralized and
distributor of healthcare products and services to office- automated distribution network, which provides
based practitioners in the combined North American customers in more than 200 countries with a
and European markets. The Company’s sales reached a comprehensive selection of more than 70,000 branded
record $5.15 billion in 2006. and Henry Schein private-brand products in stock,
as well as over 100,000 additional products available
The Company provides innovative solutions for
to our customers as special order items.
healthcare professionals and is recognized for its
excellent customer service and highly competitive Henry Schein also offers a wide range of innovative
prices. Henry Schein’s four business groups– value-added practice solutions for healthcare
Dental, Medical/Animal Health, International and professionals, such as ARUBA ®, the Company’s
Technology–serve more than 500,000 customers electronic catalog and ordering system. Its leading
worldwide, including: software systems–DENTRIX® and Easy Dental® for
dental practices; MicroMD® for medical providers
• Approximately 85% of the estimated 135,000
in primary care and all specialties; LabNet® for
U.S. and Canadian office-based dental practices
dental laboratories; and AVImark® for veterinary
and 19,000 dental laboratories;
clinics–have been installed in more than 50,000
• Approximately 45% of the estimated 250,000
healthcare practices.
U.S. office-based physician practices, as well as
surgical centers and other alternate-care sites; Henry Schein has been included in the FORTUNE
list of America’s Most Admired Companies for three
• Over 75% of the estimated 26,000 veterinary practices
consecutive years, and each of those years the Company
in the United States;
has led its industry in social responsibility.
• Approximately 240,000 office-based dental, medical
and veterinary practices outside North America, Headquartered in Melville, N.Y., Henry Schein
primarily in Europe, Australia and New Zealand; and employs more than 11,000 people and has operations
in 19 countries. For more information, visit the
• Government and other institutions providing
healthcare services. Henry Schein Web site at www.henryschein.com.

3. TO OUR STOCKHOLDERS
However, it is likely that even their healthcare professions that we serve;
Seventy-five years ago,
optimistic vision for what Henry reinvention of our Company to take
in the middle of the Great Schein could become fell short of the advantage of changing markets and
Depression, Henry and Esther reality that we have been able to emerging areas of opportunity;
achieve: a multinational FORTUNE sustained growth in every facet of our
Schein founded our Company
500® company that is the largest Company; commitment to meeting
as a small pharmacy in Queens, distributor of healthcare products our customers’ many practice needs;
and services to office-based dental, and preservation of our unique
New York. Their business
medical, and veterinary practitioners values-based culture, a legacy of
philosophy, commitment to their
in the combined North American and our founders.
customers and employees, and European markets.
Celebrating Our Success – 2006
willingness to adapt their It has been a remarkable journey, and
Our most recent year was also our most
as we reach this milestone 75th
business to take advantage of
successful. In 2006, we posted record
anniversary, it is appropriate to reflect
new opportunities drove our net sales of $5.15 billion, an increase
on and celebrate our past success. As
of 11.2% over the prior year, including
you will see in this Annual Report, the
Company’s early success and
10.6% growth in local currencies.
history of our Company has been
laid the foundation for the
Our operating margin expanded by 24
marked by innovation that has helped
decades of growth that followed. basis points over 2005, while income
reshape our industry and the
1
HENRY SCHEIN

4. “On a long journey such as ours, a significant milestone such as
from continuing operations increased In 2006, our Company continued We added new products to our
to grow through several strategic
by 21.3% and earnings per diluted growing list of exclusive offerings:
acquisitions: NLS Animal Health, a
share from continuing operations state-of-the-art dental radiography
full-service animal health distribution
grew by 19.3%. Each of our four products from Imaging Sciences
business, which significantly enhanced
business groups posted market share International, including the i-CAT™
our presence in the U.S. veterinary
gains for the year with sales of $2.14 Cone Beam 3-D Imaging System; the
market; Darby Medical Supply, which
billion for Dental, $1.52 billion for complete line of BIOLASE® dental laser
provides medical supplies and
Medical (including Animal Health), systems, including the Waterlase MD™,
pharmaceuticals to U.S. medical
$1.4 billion for International, and $98 the industry’s leading “all-tissue” dental
practices; Island Dental, a full-service
million for Technology. laser system; and the Milestone Single
U.S. distributor of dental merchandise Tooth Anesthesia™ system.
These financial results were
and equipment; Darby Dental
supported by many operational We celebrated several public
Laboratory Supply, a distributor that
achievements throughout the year, achievements during the year. Henry
has been serving the U.S. dental lab
with the continued implementation of Schein climbed to the FORTUNE 500
community for more than 50 years;
global corporate programs in human list and is now number 438. We have
and Provet Holding AG, the leading
resources, information technology, been included in the FORTUNE list of
animal health distributor in Switzerland,
inventory management, distribution America’s Most Admired Companies
which greatly expanded our European
and other key operational areas. for three consecutive years, and each
Animal Health operations.
2
HENRY SCHEIN

5. 75 years is not a final destination, but simply a chance to reflect...”
of those years the Company has led healthcare advocacy and education; Focused On Our Future
increase access to care among
our industry in social responsibility. In
In addition to these many activities,
underserved populations; strengthen
2006, we were designated as one of
we looked forward during the year
community wellness programs; and
only 12 “turbocharged” companies on
as we started our 2007-2009 strategic
prepare for and respond to disasters.
FORBES Platinum list based on our
plan. We reaffirmed our commitment
These initiatives ranged from high-
multi-year double-digit growth in sales
to provide our customers with
profile access to care programs (such
and earnings per share. Henry Schein
a consistently superior experience
as Give Kids A Smile and Healthy
is now included in NASDAQ’s highest
through innovative solutions to
Children, Healthy Lifestyles) to
listing tier–the NASDAQ Global Select
practice issues enabling the best
community-based initiatives (such as
Market. And in 2006, we were pleased
quality patient care, and practice
the Back to School program in the
to celebrate 15 years of operations
efficiency and success. To achieve
United States and Canada, and Crisis at
in the United Kingdom, Spain and
this, we will share best practices and
Christmas in the United Kingdom),
the Netherlands.
services across borders and functions;
and from product support for
The year was marked by further we will remain a technology leader
healthcare missions to Africa to
expansion of Henry Schein Cares™, and consistently deliver superior
humanitarian relief around the world
our global social responsibility integrated solutions to meet our
(through Medshare International,
program that is “helping health customers’ practice needs; we will
Direct Relief International and the
happen.” The activities we supported become trusted advisors to the more
International Medical Corps).
during 2006 helped enhance than 500,000 customers we serve
3
75 YEARS OF SUCCESS

6. “We are certain that the road we are on is a positive path forward
and confident that our best years lie ahead.”
around the world; we will clearly resistant markets. Team Schein will We are certain that the road we are on
define and communicate our Henry continue to grow, and Team Schein is a positive path forward and confident
Schein global brand; and we will Members will remain committed that our best years lie ahead. On behalf
ensure that Team Schein–now to providing our customers with of our Board of Directors and my Team
more than 11,000 members strong– excellent service. Collectively we will Schein colleagues, we are delighted
continues to be our greatest asset preserve the values-based culture that that you are our companions on this
through recruitment and professional distinguishes our Company and has exciting journey, and we thank you for
development. been the foundation of our success. your continued support.
We will continue to give back to
On a long journey such as ours, a Sincerely,
society through Henry Schein Cares™,
significant milestone such as 75 years
expanding this commitment as our
is not a final destination, but simply a
Company continues to grow. And we
chance to reflect and to look ahead at
will embrace change, as we have done
the road not yet traveled. We are
Stanley M. Bergman
throughout our Company’s history,
confident that Henry Schein is in the
Chairman and Chief Executive Officer
strategically reinventing Henry Schein
right markets at the right time. We are
as necessary to remain a strong,
a well-diversified industry leader in
forward-looking industry leader well
healthy, technology-driven, recession-
into the future.
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HENRY SCHEIN

7. FINANCIAL HIGHLIGHTS
NET SALES OPERATING MARGIN EARNINGS PER RETURN ON OPERATING CASH FLOW
From Continuing Operations From Continuing Operations DILUTED SHARE COMMITTED CAPITAL ($ in millions)
From Continuing Operations (3)
($ in millions) (2)
(3)
See the Notes below for (3)
discussion of Non-GAAP Disclosures See the Notes below for
discussion of Non-GAAP Disclosures
NOTES:
Operating Margin and Earnings from Continuing Operations Per Diluted Share have been adjusted to exclude certain one-time items. Refer to Non-GAAP Disclosures on page 21.
Additionally, refer to our annual consolidated financial statements for a complete presentation of our Consolidated Statements of Cash Flows.
(1) During 2004, we recorded a non-recurring $13.2 million pre-tax ($8.4 million post-tax) charge related to the Fluvirin® contract with Chiron Corporation.
The effect that this charge had on earnings per share for the year ended December 25, 2004 was ($0.10). Excluding this charge, our earnings per diluted share for 2004 was $1.39.
(2) Return on Committed Capital represents operating income over average committed capital (committed capital equals inventory plus trade accounts receivables
and net property, plant and equipment less trade accounts payables.)
(3) Adjusted to reflect the effect of our adoption, on January 1, 2006, of FAS 123(R) using the modified retrospective application.
5
75 YEARS OF SUCCESS

8. Serving Our Customers
With A World-Class Infrastructure
As the largest distributor of healthcare feet of space in 31 distribution as special-order items. To help meet
products and services to office-based centers throughout North America, virtually all of our customers’ practice
practitioners in the combined North Europe, Australia and New Zealand– needs are 2,425 field sales consultants
American and European markets, the to efficiently and accurately ship over and equipment sales specialists; 1,375
world’s leading value-added dental 11 million customer orders annually. In telesales representatives; 136 independent
distributor, and the only Pan-European the United States and Canada, 99% of software sales representatives; and
distributor in the office-based our orders are shipped the same day more than 700 equipment service
healthcare industry, Henry Schein the order is placed, are delivered within technicians, all supported by over
serves more than 500,000 customers two days of placement, and are shipped 35 million targeted direct-marketing
and has the capability to provide with virtually 100% accuracy. And our pieces annually.
door-to-door air package delivery to state-of-the-art “cold chain” distribution
practitioners in over 200 countries capabilities ensure the integrity of heat-
around the world. sensitive products shipped.
More than 11,000 Team Schein Our customers can choose from more
Members in 19 countries use our than 70,000 branded and Henry Schein
leveragable, world-class, centralized private-brand products in stock, as well
infrastructure–nearly 3 million square as 100,000 additional products available
6
HENRY SCHEIN

9. Henry Schein efficiently and accurately
shipped over 11 million orders during 2006.
In the U.S. and Canada, 99% of our orders
are shipped the same day the order is placed
and delivered within two days of placement.
Henry Schein’s state-of-the-art, cold-chain
distribution capabilities ensure the integrity
of vaccines and other heat-sensitive products.
Voice pick technology contributes to
Henry Schein’s average order accuracy
rate of virtually 100%.
7
75 YEARS OF SUCCESS

10. Meeting Virtually All
Dental Customers’ Practice Needs
Dental spending continues to increase, and diagnostic procedures in dental strengthened with the acquisition of
driven in part by a growing awareness practices are all accelerating dental Island Dental, a full-service distributor
of the correlation between oral health spending. These trends have resulted of dental merchandise and equipment,
and overall well-being. Studies have in a need for greater dental practice and Darby Dental Laboratory Supply, a
demonstrated the relationship between productivity, which is driving equipment full-line distributor serving the U.S.
periodontal disease and stroke or heart and technology sales. dental lab community.
attack, while other research shows that
Henry Schein’s Dental Group, which The Dental Group offers approximately
some chronic health conditions, such as
includes Sullivan-Schein Dental and 42,000 in-stock products to our dental
diabetes, may place a person at greater
Zahn Dental Laboratory in the U.S. and customers and many more as special-
risk for periodontal disease. Most
Henry Schein Ash Arcona in Canada, is order items. This comprehensive
recently, a Harvard study has suggested
there to meet virtually all of our dental selection includes many important
a link between poor oral health and
customers’ needs for operating an product exclusives, such as the
pancreatic cancer.
efficient and successful practice while Camlog™ dental implant system;
As a result, the important role of dentists providing a high quality of patient care. Colgate® Oral Care line of products;
in the healthcare continuum is becoming The Group serves approximately 85% DEXIS® digital radiography products;
clearer, as they help in the early of the estimated 135,000 U.S. and BruxGuard™; Pentron ® Laboratory
detection of cardiovascular disease, Canadian office-based dental practices Products; ShadeVision™; the i-CAT™
asthma, oral cancer and other conditions. and 19,000 laboratories, and has Cone Beam 3-D Imaging Systems
Additionally, the percentage of patients approximately 38% of the estimated from Imaging Sciences International;
with dental insurance coverage, a $5.5 billion U.S. and Canadian BIOLASE® dental laser systems; and
greater emphasis on cosmetic dentistry, distribution market. In 2006, our Milestone Single Tooth Anesthesia™
and the growing use of pharmaceuticals position in the market was further system.
8
HENRY SCHEIN

11. Among the many Henry Schein product
exclusives is the complete line of BIOLASE ®
dental laser systems, including the
Waterlase MD™, the industry’s leading
“all-tissue” dental laser system.
Henry Schein’s dental offering features
state-of-the-art radiography products from
Imaging Sciences International, including the
i-CAT™ Cone Beam 3-D Imaging System.
BUSINESS GROUP NET SALES
42%
Equipment repair services through ProRepair®
DENTAL
and COMPLETEcare are just part of the wide • Sales $2.14 billion
range of value-added services that we offer to • % of Company sales 42%
our dental customers.
9
75 YEARS OF SUCCESS

12. Providing Physicians With Products
To Meet Growing Demand
As baby boomers, the most educated Henry Schein’s Medical Group is well We offer our medical customers a
and affluent generation in history, positioned to serve physician customers selection of approximately 35,000
continue to age, they are willing to affected by this shift. The Group products in stock and many more as
spend more money on their health. At currently serves approximately 45% of special-order items.
the same time, advances in healthcare the estimated 250,000 U.S. office-based
In addition, we are a leading supplier
technology are helping physicians to physician practices, surgical centers and
of vaccines, injectables and other
meet their patients’ desires to remain other alternate-care sites, and holds
pharmaceuticals to physicians and
healthier longer. approximately 17% of the estimated
alternate-care sites, providing our
$8.5 billion medical and veterinary
As a result of these converging trends, customers with influenza, tetanus/
distribution market.
demand for physician and clinical diphtheria toxoid, pneumonococcal and
services continues to increase in In 2006, the Group added Darby many other vaccines. And we are
developed countries around the world. Medical Supply, which supplies medical pleased to offer formulary plans to
Diagnostic tests, screenings and other supplies and pharmaceutical products, many of the leading medical
elective surgical procedures are moving including generic drugs, branded drugs professional associations, such as the
from hospitals to physicians’ offices or and vaccines, to medical practices American Medical Association, the
alternate-care settings. In fact, 63% across the United States. American Society of Plastic Surgeons,
of all surgeries in the United States the American Academy of Dermatology,
are now performed as outpatient and the American Academy of
procedures. Ophthalmology.
10
HENRY SCHEIN

13. Henry Schein offers formulary plans to
many of the leading medical professional
associations, such as the American Medical
Association, the American Society of Plastic
Surgeons, the American Academy of
Dermatology, and the American Academy
Henry Schein is a leading supplier of of Ophthalmology.
vaccines, injectables, and other
pharmaceuticals to physicians and
alternate-care sites.
BUSINESS GROUP NET SALES
29%
Henry Schein’s Medical Group supports our
MEDICAL
physician customers—approximately 45% of the
• Sales $1.52 billion
(including Animal Health)
estimated 250,000 U.S. office-based physician
• % of Company sales 29%
practices—with a selection of over 35,000 products
(including Animal Health)
in stock and many more as special-order items.
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75 YEARS OF SUCCESS

14. Helping Veterinarians Serve
A Burgeoning Pet Population
The U.S. companion animal market is Henry Schein’s Animal Health Group is Henry Schein’s leading software systems—DENTRIX ®
currently estimated to be growing at ideally positioned to capitalize on this and Easy Dental ® for dental practices; MicroMD ® for
5-7% annually, spurred by a number growing market. In 2006, we acquired
medical providers in primary care and all specialties;
of demographic factors. Overall, the NLS Animal Health, which serves
LabNet ® for dental laboratories; and AVImark ® for
number of U.S. households is growing, veterinarians in 26 states and
veterinary clinics— have been installed in more
as is the proportion of households significantly enhanced our position
than 50,000 practices.
with pets. While the overall pet within the market. We now serve
population continues to increase, over 75% of the estimated 26,000
annual expenditures per pet are also U.S. veterinary practices, offering
rising. And studies have reported that veterinarians a wide selection of
pet ownership may contribute to the approximately 23,000 products in stock
overall well-being of pet owners and many more as special-order items.
themselves.
As a result of these factors, there is
greater demand for veterinary oncology
and oral health services, and an
increase in the specialty services
offered by veterinarians.
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HENRY SCHEIN

15. Leading Through Technology
Office-based dental, medical and certified as meeting all 2006 ambulatory our Privileges™ customer loyalty
veterinary practitioners turn to the health record criteria by the program, which was designed to attract,
products and services offered by our Certification Commission for Healthcare retain and reward dental customers,
Technology Group to increase practice Information Technology. now with more than 25,000 U.S. Dental
efficiency and profitability and facilitate members, with similar programs being
Practitioners also benefit from the wide
delivery of quality healthcare to their introduced to our U.S. Medical
range of value-added services that we
patients. customers and already active in nine
offer, including: repair services through
international markets.
Our proprietary software systems ProRepair® and COMPLETEcare; office
include DENTRIX ® and Easy Dental® design services; continuing education;
for dental practices; MicroMD for electronic health claims processing
®
medical providers in primary care and (with more than 36 million claims
BUSINESS GROUP NET SALES
all major specialties; LabNet for processed in 2006); Information
®
dental laboratories; and AVImark® for Technology Solutions including
veterinary practices. These systems are computer hardware, integration and
installed in more than 50,000 practices. support services; 24/7 ordering
2%
Ranked highest in customer satisfaction capability through our ArubA® Web-
by an independent research based electronic catalog and ordering
organization, DENTRIX seamlessly system and other options; Financial
®
integrates digital X-ray, intraoral Services such as equipment leasing and TECHNOLOGY
imaging and other technology tools. financing, patient financing, and • Sales $98 million
And MicroMD® EMR 4.5 has been electronic credit card processing; and • % of total Company sales 2%
13
75 YEARS OF SUCCESS

16. Growing Our Global Presence
We will continue to expand our
At Henry Schein, we now serve one Republic, France, Germany, Iceland,
successful full-service dental model
world of customers–a world that has Ireland, Israel, Italy, Luxembourg, the
throughout Europe, positioning our
become a single global market for Netherlands, New Zealand, Portugal,
field sales consultants and telesales
dental, medical and veterinary office- Spain, Switzerland and the United
representatives as trusted advisors to
based practitioners who have similar Kingdom. And through Schein Direct,
needs regardless of geographic which provides door-to-door air our customers. We also will continue
boundaries. Like their North American package delivery service, we have to explore expansion opportunities
colleagues, healthcare practitioners in the capability to serve practitioners abroad in countries where we currently
countries around the world are in more than 200 countries around have a presence, as well as potential
expansion into new markets. In 2006,
searching for solutions to help them the world.
we were pleased to expand our
operate more efficient and profitable
Our International Group currently
presence in the European animal health
practices as they provide a high quality
holds approximately 15% of the
market with the acquisition of Provet
of patient care.
estimated $8 billion combined dental,
Holding AG, the leading animal health
We meet our international customers’ medical and animal health market in
distribution company in Switzerland.
needs by providing superior service the European countries in which we
And we will further refine the Henry
and the most comprehensive selection operate. With significant room for
Schein global brand to ensure that all of
of products. Our International Group future growth, we will share best
our customers and suppliers around the
serves approximately 240,000 office- practices and operational efficiencies
world clearly understand the benefits of
based dental, medical and veterinary across international borders and
partnership with our Company.
practices and has operations in 17 markets as we continue to build an
countries outside of North America: infrastructure based on our successful
Austria, Australia, Belgium, the Czech U.S. model.
14
HENRY SCHEIN

17. Among the more than 35 million
targeted direct-marketing pieces that
Henry Schein distributes annually are
catalogs in German, Spanish, English
and many other languages spoken by
the more than 500,000 customers we
Henry Schein’s newly opened warehouse
serve around the world.
in France is just one of the state-of-the-art
distribution centers throughout
North America, Europe, Australia and
BUSINESS GROUP NET SALES
New Zealand—nearly 3 million square feet
of space through which over 11 million
27%
customer orders are efficiently and
accurately shipped each year.
In 2006, Henry Schein acquired Provet
INTERNATIONAL
Holding AG, the leading animal health
• Sales $1.4 billion
distribution company in Switzerland, • % of total Company sales 27%
greatly expanding our European
Animal Health operations.
15
75 YEARS OF SUCCESS

18. “Helping Health Happen” Through
Henry Schein Cares
Henry Schein’s unique culture, which populations; strengthen community School and Holiday Cheer programs in
focuses on delivering the best possible wellness programs; and help prepare the U.S., and the Crisis at Christmas and
service to our customers, is defined by for and respond to disasters. By using Help a Local Child initiatives in the U.K.
our values of mutual responsibility, our core competencies–our extensive In Germany, we produced a play for
ethical behavior, creativity and open healthcare product offerings and kindergartners to educate children
communication. We recognize that logistical distribution capabilities, our about the importance of oral health,
each Team Schein Member is as close relationships with customers and while in France we supported the
important as the next; are committed to supplier partners, and our extensive Bucco Bus to provide dental care
enhancing diversity and cultural communication network–in creative to the elderly in nursing homes. We
competency throughout our Company and innovative ways, we further the provided support for healthcare
to better serve our changing customer goals of many worthy programs. And missions to Africa, helped people in
base; and invest in ongoing sales force by “helping health happen” we believe need around the world through
training to make each interaction that we are furthering our Company’s Medshare International and Direct
as productive as possible for our long-term success. Relief International, and contributed
customers. humanitarian relief supplies for
In 2006, Henry Schein Cares™ activities
Lebanon and Israel through the
Our culture also includes a commitment broadened in scope. We sponsored
International Medical Corps. Finally,
to social responsibility, which we put high-profile access to care programs
we helped to rebuild our customers’
into action through Henry Schein such as Give Kids A Smile and Healthy
practices on the U.S. Gulf Coast, and,
Cares™, our global social responsibility Children, Healthy Lifestyles, and
with the ADA, donated the state-of-the-
program. Through the activities we created the Henry Schein Comfort Cart
art mobile dental clinic Tomorrow’s
support, we enhance healthcare at New York’s Schneider Children’s
Dental Office Today to the State of
advocacy and education; increase Hospital. Our community-based
Mississippi for ongoing outreach.
access to care among underserved initiatives included our annual Back to
16
HENRY SCHEIN

19. Through Henry Schein Cares, our global
social responsibility program, we help
enhance healthcare advocacy and
education; increase access to care among
underserved populations; strengthen
community wellness programs; and
prepare for and respond to disasters.
17
75 YEARS OF SUCCESS

20. 75 Years of Success
Henry Schein has a history of driving change and innovation in
the industries it serves. The Company has frequently transformed itself to
meet customers’ needs, take advantage of new technologies, and tap into
burgeoning markets. These are some of the changes that Henry Schein has
undergone and innovations it has introduced over the years.
1950s 1959 1962 1969
Henry Schein shifts Sales: $1 Million; Company introduces Sales: $5.7 Million;
business focus 15 TSMs 1st Henry Schein 35 TSMs
from customers to Catalog
office-based
practitioners
Up until the 1960s,
many Team Schein
Members called
Henry Schein “Papa.”
1985 1986 1989 1990
Company focuses on Henry Schein Stanley Bergman Henry Schein begins
veterinary dentistry; introduces the Protex becomes Chairman international expansion
acquires Zahn Dental program to educate and CEO of Henry (The Netherlands, United
the dental profession Schein following the Kingdom, and Spain)
about infection control untimely death of
Jay Schein;
Sales: $225 Million;
890 TSMs Henry Schein’s European expansion
began in the Netherlands in 1990.
The most popular item sold internationally
on the first day was tennis balls.
2001 2002
2000
1999 2003
Company introduces the Henry Schein
Henry Schein becomes
Company acquires Company acquires
Digital Dental Office, establishes
the only Pan-European
Heiland (Germany) Colonial Surgical (U.S.)
Privileges customer Sullivan-Schein
dental, medical, and
and GIV (U.S.) and Hager Dental
loyalty program, and University; begins role
veterinary distributor; (Germany)
Customer Analysis Tool as exclusive distributor
Sales: $2.38 Billion;
(CAT) system; establishes of professional products
6,200 TSMs
the Henry Schein Cares for ADA’s Give Kids
global social
“This is what we are A Smile! program;
responsibility program Sales: $2.68 Billion;
really all about — 6,900 TSMs
technology,
a concern for people,
and a concern for
results.”
- Jay Schein
18
HENRY SCHEIN

21. 1949
1935 1940s 1942
1932
Sales: $175,000;
Company fulfills Company introduces Company begins
Henry Schein is
4 TSMs
mail order private-brand dental, direct sale of
founded by Henry and
prescriptions medical, and penicillin
Esther Schein as a
using flyers veterinary products to customers
storefront pharmacy
in Queens, NY;
2 TSMs
“Through the years, we always insisted on making
The initial investment our people feel special, like family.”
in Henry Schein, Inc.
- Esther Schein
in 1932 was $500.
1984
1980
1971 1983
1979
Company becomes
Introduction of
Jay Schein becomes
Company focuses on Sales: $58 Million;
first in the industry to
TouchTone™
Chairman and CEO
dental practitioners, 180 TSMs
fully automate the
telephone ordering
of Henry Schein, Inc.,
concentrating on
distribution cycle
beginning a new
operational excellence
period of record
and discounted prices
growth and prosperity
for the Company
In 1983, Henry Schein led the
industry with ProTONETM, the first
electronic system allowing customers
to order by TouchToneTM phone.
1998
1997
1994 1996
1995
Company acquires
Henry Schein acquires
Company leads the Company introduces
Henry Schein is listed
Regional Healthcare
Sullivan Dental Products,
industry with a unique integrated sales
on NASDAQ Marketplace
(Australia), Arcona
Dentrix Dental Systems,
dental practice-management and marketing approach
(HSIC), raising $72.8
(Canada), and
and Caligor; Company
software system; electronic to serving customers
million in the initial
Meer Dental (U.S.);
becomes largest healthcare
claims processing is offered (field sales, telesales,
public offering;
Sales: $1.92 Billion;
distributor serving
direct marketing);
acquires Veratex
5,500 TSMs
office-based practitioners
Sales: $830 Million;
3,200 TSMs
Shares of Henry Schein traded
publicly on NASDAQ for the first time
on November 3,1995. The initial price
was $8 per share (split-adjusted).
2004 2005 2006
Henry Schein debuts on Henry Schein celebrates Henry Schein is again
FORTUNE 500; acquires 10 years as a publicly included in FORTUNE’s list
Demedis (Germany), traded company; of America’s Most Admired
2007
KRUGG (Italy), Company acquires Companies and ranked
Ash Temple (Canada), Ash Temple (Canada), Number 1 in the industry “For 75 years, our values-based Team Schein
and Barton-Cyker Dental Halas Dental (Australia), for social responsibility; culture, our unsurpassed level of customer
Supply (U.S.); introduces and Shalfoon Brothers Company acquires service, and our commitment to social
Tomorrow’s Dental Office (New Zealand) NLS Animal Health, responsibility have distinguished Henry Schein
Today (TDOT); Darby Medical Supply,
in the marketplace and made us one of
Sales: $3.9 Billion; Island Dental, Darby
FORTUNE’s “Most Admired” companies.
9,600 TSMs Dental Laboratory Supply,
As we continue to grow beyond this
and Provet Holding AG
milestone year, preservation of this unique
(Switzerland);
corporate culture will ensure that our best
Sales: $5.15 Billion;
years are still to come.”
More than 11,000 TSMs
- Stanley M. Bergman
19
75 YEARS OF SUCCESS

22. SELECTED FINANCIAL DATA
The following selected financial data, with respect to our financial position and results of operations for each of the five fiscal years in the period ended December 30, 2006, set forth below, has been derived from, should be read in
conjunction with and is qualified in its entirety by reference to, our consolidated financial statements and notes thereto. The selected financial data presented below should also be read in conjunction with ITEM 7, “Management's
Discussion and Analysis of Financial Condition and Results of Operations” and ITEM 8, “Financial Statements and Supplementary Data.”
Years ended
December 30, December 31, December 25, December 27, December 28,
2005 (1) 2004 (1) 2003 (1) 2002 (1)
2006
(in thousands, except per share data)
Income Statement Data:
Net sales $5,153,097 $4,635,929 $3,898,485 $3,194,031 $2,675,645
Gross profit 1,480,055 1,316,936 1,054,465 908,163 771,538
Selling, general and administrative expenses (2) 1,175,158 1,053,798 862,267 690,393 591,915
Operating income 304,897 263,138 192,198 217,770 179,623
Other expense, net (9,295) (16,534) (11,121) (8,973) (6,933)
Income from continuing operations before taxes, minority interest and
equity in earnings of affiliates 295,602 246,604 181,077 208,797 172,690
Income taxes from continuing operations (105,220) (90,456) (67,016) (77,959) (63,487)
Minority interest in net income of subsidiaries (8,090) (5,963) (1,486) (2,807) (2,591)
Equity in earnings of affiliates 835 827 1,699 931 659
Income from continuing operations 183,127 151,012 114,274 128,962 107,271
Income (loss) from discontinued operations, net of tax (3) (19,368) (11,253) 2,565 (794) 4,146
Net income $ 163,759 $ 139,759 $ 116,839 $ 128,168 $ 111,417
Earnings from continuing operations per share:
Basic $ 2.08 $ 1.74 $ 1.31 $ 1.48 $ 1.23
Diluted 2.04 1.71 1.29 1.45 1.21
Earnings (loss) from discontinued operations per share:
Basic $ (0.22) $ (0.13) $ 0.03 $ (0.01) $ 0.05
Diluted (0.22) (0.13) 0.03 (0.01) 0.04
Earnings per share:
Basic $ 1.86 $ 1.61 $ 1.34 $ 1.47 $ 1.28
Diluted 1.82 1.58 1.32 1.44 1.25
Weighted-average common shares outstanding:
Basic 87,952 87,006 87,253 87,417 86,978
Diluted 89,820 88,489 88,646 89,099 89,007
Years ended
December 30, December 31, December 25, December 27, December 28,
2006 2005 2004 2003 2002
Net Sales by Market Data: (in thousands)
Healthcare Distribution (4)
Dental (5) $2,136,830 $1,896,643 $1,602,457 $1,364,812 $1,227,273
Medical (6) 1,516,155 1,394,121 1,284,279 1,178,310 944,600
International (7) 1,401,889 1,256,910 928,207 576,628 437,046
Total Healthcare Distribution 5,054,874 4,547,674 3,814,943 3,119,750 2,608,919
Technology (8) 98,223 88,255 83,542 74,281 66,726
Total $5,153,097 $4,635,929 $3,898,485 $3,194,031 $2,675,645
As of
December 30, December 31, December 25, December 27, December 28,
2006 2005 2004 2003 2002
(in thousands)
Balance Sheet Data:
Total assets $2,881,146 $2,583,120 $2,433,670 $1,819,370 $1,558,052
Long-term debt 455,806 489,520 525,682 247,100 242,561
Minority interest 21,746 12,353 12,438 11,532 6,748
Stockholders' equity (1) 1,470,963 1,249,154 1,117,706 1,006,551 863,133
See page 21 for Notes For Selected Financial Data.
20
HENRY SCHEIN

23. NON-GAAP DISCLOSURES
The following table sets forth, for the periods indicated, a reconciliation of operating income and income from continuing operations adjusted to reflect the effects of discontinued operations, as reported to adjusted operating income
and adjusted income from continuing operations. The diluted earnings from continuing operations per share and weighted-average common shares outstanding information reflects a two-for-one stock split effected in the form of a
dividend that became effective on February 28, 2005.
Years ended
December 25, December 27, December 28, December 30,
2004 2003 2002 1995
(in thousands, except per share data)
Operating income (loss), as reported $ 192,198 $ 217,770 $ 179,623 $ (1,474)
Adjustments:
Merger, integration, and restructuring credits - - (734) -
Special management compensation costs - - - 20,797
One-time charge related to influenza vaccine contract 13,246 - - -
Adjusted operating income 205,444 217,770 178,889 19,323
Adjusted operating margin 5.3% 6.8% 6.7% 3.1%
Income (loss) from continuing operations, as reported 114,274 128,962 107,271 (10,479)
Adjustments, net of tax:
Merger, integration, and restructuring credits - - (734) -
Special management compensation costs - - - 19,623
Gains on real estate transactions - (454) (890) -
One-time charge related to influenza vaccine contract 8,358 - - -
Adjusted income from continuing operations $ 122,632 $ 128,508 $ 105,647 $ 9,144
Diluted earnings (loss) from continuing operations per share:
As reported $ 1.29 $ 1.45 $ 1.21 $ (0.39)
Adjusted 1.39 1.44 1.19 0.34
Diluted weighted-average common shares outstanding: 88,646 89,099 89,007 26,894
USE OF NON-GAAP MEASURES:
NOTES FOR SELECTED FINANCIAL DATA:
The above information includes financial measures that
(1) Adjusted to reflect the effects of our adoption of FAS 123(R) using the modified retrospective application.
are not calculated and presented in accordance with
(2) During 2004, we recorded a $13.2 million pre-tax ($8.4 million post-tax) charge related to our Fluvirin® contract with Chiron Corporation. This charge, which
accounting principles generally accepted in the United
represented the write-off of a deferred expense associated with the 2005/2006 influenza season, occurred as a result of the significant uncertainty about whether
States (quot;GAAPquot;). The above table reconciles operating
Chiron would be able to provide Fluvirin® for the 2005/2006 influenza season. The effect that this charge had on earnings per share for the year ended
income, income from continuing operations and diluted
December 25, 2004 was $(0.10).
earnings (loss) from continuing operations per share,
(3) On April 1, 2006, we sold substantially all of the assets of our Hospital Supply Business, previously reported as part of our healthcare distribution reportable segment. our most directly comparable measure calculated and
The sale price was $36.5 million, which was received during the second quarter of 2006. As a result of this sale, included in the operating results from discontinued presented in accordance with GAAP, to comparable
operations for 2006 is a $32.3 million ($19.4 million after-tax) loss on the sale, including $3.5 million ($2.1 million after-tax) of transitional service obligations and amounts as adjusted to eliminate the effect of
selling costs. Also, because the decision to divest this business was reached in 2005, we recorded an impairment charge to our long-lived assets of approximately one-time items.
$7.0 million, net of tax, or $(0.08) per diluted share in 2005.
In the third quarter of 2003, we sold PMA Bode GmbH, an X-ray film distribution business located in Germany, which was a component of our healthcare distribution
We eliminated the effect of such one-time items
business. This sale resulted in a loss of $2.0 million, net of tax, or $(0.02) per diluted share. Due to immateriality, we have not reflected the operating results,
to assist in evaluating the underlying operational
other than the loss on sale, of PMA Bode separately as a discontinued operation for any of the periods presented. This was partially offset by the Hospital discontinued
performance of our business, excluding such one-time
operation discussed above.
items, over the periods presented. We believe that
(4) Consists of consumable products, small equipment, laboratory products, large dental equipment, branded and generic pharmaceuticals, vaccines, surgical products, this presentation is appropriate and facilitates such
diagnostic tests, infection-control products and vitamins. an evaluation by us, investors and analysts. These
measures should be considered supplemental to,
(5) Consists of products sold in the United States and Canada.
and not a substitute for or superior to, financial
(6) Consists of products sold in the United States' medical and animal health markets.
measures calculated in accordance with GAAP.
(7) Consists of products sold in the dental, medical and animal health markets, primarily in Europe.
(8) Consists of practice management software and other value-added products and services, which are sold primarily to healthcare providers in the United States and Canada.
21
75 YEARS OF SUCCESS

24. BOARD OF DIRECTORS
Stanley M. Bergman Standing Row l to r:
Mark E. Mlotek,
Chairman and Chief Executive Officer
Steven Paladino,
Barry Alperin (1) (2) (3) Philip Laskawy (1) (3) (4)
Paul Brons,
Retired Vice Chairman, Hasbro, Inc. Retired Chairman, Ernst & Young
Louis W. Sullivan,
Gerald A. Benjamin Norman Matthews (2) (4) Norman Matthews,
Philip Laskawy,
Executive Vice President and Chief Administrative Officer Former President, Federated Department Stores
Donald Kabat,
James P. Breslawski Mark E. Mlotek
Gerald A. Benjamin
President and Chief Operating Officer Executive Vice President, Corporate Business Development
Paul Brons (4) Steven Paladino Seated Row l to r:
Former Member, Board of Management, Akzo Nobel N.V. Barry Alperin,
Executive Vice President and Chief Financial Officer
Margaret A. Hamburg,
Margaret A. Hamburg, M.D. (4) Marvin H. Schein
Stanley M. Bergman,
Former Assistant Secretary for Planning and Evaluation, Founder, Schein Dental Equipment Corp.
James P. Breslawski,
U.S. Department of Health and Human Services;
Louis W. Sullivan, M.D. (3) (4) Marvin H. Schein
Former Commissioner of Health for the City of New York
Former U.S. Secretary of Health and Human Services;
Donald Kabat (1) (2) Founding Dean, Director and President Emeritus of (1) Member Audit Committee
Retired Partner, Accentur the Morehouse School of Medicine
(2) Member Compensation Committee
(3) Member Nominating and
Governance Committee
(4) Member Strategic Advisory Committee
EXECUTIVE OFFICERS
Stanley M. Bergman Leonard A. David Steven Paladino
Chairman and Chief Executive Officer Senior Vice President and Chief Compliance Officer Executive Vice President and Chief Financial Officer
James P. Breslawski Stanley Komaroff Michael Racioppi
President and Chief Operating Officer Senior Advisor President, Medical Group
Gerald A. Benjamin Mark E. Mlotek Michael Zack
Executive Vice President and Executive Vice President, President, International Group
Chief Administrative Officer Corporate Business Development
22
HENRY SCHEIN