Cover Page To Our Shareholders Issues and Answers: Contributions That Count Enterprise Profile Financials Summary Financial Review Report of Management Report of Ernst & Young LLP, Independent Auditors Financial Statements Notes to Consolidated Financial Statements    1 Summary of Significant Accounting Policies    2 Accounting Changes    3 Employee Stock Ownership Plan/Savings Incentive Plan    4 Benefit Plans    5 Special and Other Charges    6 Acquisitions    7 Income Taxes    8 Supplemental Financial Information    9 Debt   10 Financial Instruments   11 Shareholders' Equity   12 Comprehensive Income   13 Commitments and Contingencies   14 Stock Plans   15 Earnings Per Share   16 Segment Data Corporate Information Board of Directors and Officers

Notes to Consolidated Financial Statements 16    Segment Data The Company's organizational structure is based upon its three principal business segments: BD Medical Systems ("Medical"), BD Clinical Laboratory Solutions ("Clinical Lab") and BD Biosciences ("Biosciences"). Fiscal 2000 information has been reclassified to conform to current year presentation.     The major products in the Medical segment are hypodermic products, specially designed devices for diabetes care, prefillable drug delivery systems, infusion therapy products, elastic support products and thermometers. The Medical segment also includes disposable scrubs, specialty needles, and surgical blades. The major products in the Biosciences segment are flow cytometry systems for cellular analysis, reagents and tissue culture labware. The major products in the Clinical Lab segment are clinical and industrial microbiology products, sample collection products, specimen management systems, hematology instruments, and other diagnostic systems, including immunodiagnostic test kits. This segment also includes consulting services and customized, automated bar-code systems.     The Company evaluates performance based upon operating income. Segment operating income represents revenues reduced by product costs and operating expenses. The calculations of segment operating income and assets are in accordance with the accounting policies described in Note 1. During fiscal 2001, the Company refined its methodology for allocating indirect expenses for purposes of reporting segment operating income to the chief operating decision maker. The Company had previously allocated consolidated amounts using reasonable allocation methods. These consolidated amounts are now reported locally by the various regions, which allocate these expenses to the appropriate operating segment. The Company believes this approach is a more preferable method for allocating shared expenses as the allocations are being performed at a more detailed level of reporting. As a result of this change in methodology, fiscal 2000 segment operating income was restated to conform to current year presentation.     Distribution of products is both through distributors and directly to hospitals, laboratories and other end users. Sales to a distributor, which supplies the Company's products to many end users, accounted for approximately 11% of revenues in 2002, 11% in 2001, and 10% in 2000, and included products from the Medical and Clinical Lab segments. No other customer accounted for 10% or more of revenues in each of the three years presented. Revenues 2002   2001   2000 Medical Systems  $  2,151,374    $  2,004,626    $  1,966,039 Clinical Lab   1,236,319     1,151,517     1,102,352 Biosciences   645,376     590,039     549,943 Total(A) $ 4,033,069   $ 3,746,182   $ 3,618,334 Segment Operating Income(B) Medical Systems $ 470,168 (C) $ 446,940   $ 394,858 (C) Clinical Lab   251,004 (D)   212,837     169,880 (D) Biosciences   116,926 (E)   97,293     73,173 (E) Total Segment Operating Income   838,098     757,070     637,911 Unallocated Expenses(F)   (209,509 )   (180,320 )   (117,977 ) Income Before Income Taxes and Cumulative Effect of Change in Accounting Principle $ 628,589   $ 576,750   $ 519,934 Segment Assets Medical Systems $ 2,537,185   $ 2,432,709   $ 2,289,304 Clinical Lab   1,190,382     1,093,735     1,059,144 Biosciences   938,641     830,550     811,081 Total Segment Assets   4,666,208     4,356,994     4,159,529 Corporate and All Other(G)   374,252     445,293     345,567 Total Assets $ 5,040,460   $ 4,802,287   $ 4,505,096 Capital Expenditures 2002   2001   2000   Medical Systems $ 182,479   $ 265,531   $ 246,928 Clinical Lab   41,774     62,009     66,270 Biosciences   22,747     24,083     33,881 Corporate and All Other   12,703     19,131     29,293 Total $ 259,703   $ 370,754   $ 376,372 Depreciation and Amortization Medical Systems $ 150,849   $ 145,702   $ 133,787 Clinical Lab   89,275     89,117     81,577 Biosciences   50,587     58,204     63,070 Corporate and All Other   14,154     12,677     9,821 Total $ 304,865   $ 305,700   $ 288,255 (A) Intersegment revenues are not material. (B) Restated, as described above. (C) Includes $22,600 in 2002 and $39,844 in 2000 for special charges discussed in Note 5. (D) Includes $(468) in 2002 and $7,697 in 2000 for special charges discussed in Note 5. (E) Includes $(447) in 2002 and $4,576 in 2000 for special charges discussed in Note 5. (F) Includes interest, net; foreign exchange; corporate expenses; gains on sales of investments; and certain legal costs. Also includes special charges of $(177) in 2002 and $5,397 in 2000, respectively, as discussed in Note 5. (G) Includes cash and investments and corporate assets. Geographic Information The countries in which the Company has local revenue-generating operations have been combined into the following geographic areas: the United States, including Puerto Rico; and International, which is composed of Europe, Canada, Latin America, Japan and Asia Pacific.     Revenues to unaffiliated customers are based upon the source of the product shipment. Long-lived assets, which include net property, plant and equipment, are based upon physical location. Intangible assets are not included since, by their nature, they do not have a physical or geographic location.   2002   2001   2000 Revenues United States $ 2,172,894   $ 2,016,523   $ 1,863,555 International   1,860,175     1,729,659     1,754,779 Total $ 4,033,069   $ 3,746,182   $ 3,618,334 Long-Lived Assets United States $ 974,797   $ 956,138   $ 866,125 International   653,464     633,671     578,741 Corporate   137,469     126,214     131,192 Total $ 1,765,730   $ 1,716,023   $ 1,576,058 Quarterly Data (Unaudited) Thousands of dollars, except per-share amounts   2002 1st   2nd   3rd   4th   Year Revenues $ 944,946   $ 1,012,971   $ 998,460   $ 1,076,692   $ 4,033,069 Gross Profit   445,184     489,838     484,389     529,989     1,949,400 Net Income   99,673     129,188     119,725     131,396     479,982 (A) Earnings Per Share:   Basic   .38     .50     .46     .51     1.85   Diluted   .37     .48     .44     .50     1.79   2001 1st   2nd   3rd   4th   Year Revenues $ 864,418   $ 950,949   $ 943,290   $ 987,525   $ 3,746,182 Gross Profit   410,500     464,211     468,399     489,780     1,832,890 Income Before Cumulative   Effect of Accounting Change   73,698     114,165     118,129     132,410     438,402   Net Income   36,948 (B)   114,165     118,129     132,410     401,652 (B) Basic Earnings Per Share:   Income Before Cumulative Effect   .29     .44     .46     .51     1.69   Net Income   .15 (B)   .44     .46     .51     1.55 (B) Diluted Earnings Per Share:   Income Before Cumulative Effect   .28     .42     .44     .49     1.63   Net Income   .14 (B)   .42     .44     .49     1.49 (B) (A) Includes $9,937 and $11,571 of special charges in the second and third quarters, respectively. (B) Includes an after-tax charge of $36,750, or $.14 per share, for the cumulative effect of accounting change.