SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C.  20549

                            FORM 10-Q

(X)   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended     March 31, 1996
                               -----------------------

                                 OR

( )   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to _______________

                  Commission File Number 0-16211

                   DENTSPLY International Inc.
- -----------------------------------------------------------------
      (Exact name of registrant as specified in its charter)

      Delaware                                    39-1434669
- -----------------------------------------------------------------
(State or other jurisdiction of                (I.R.S. Employer
incorporation or organization)                Identification No.)


570 West College Avenue, P. O. Box 872, York, PA  17405-0872
- -----------------------------------------------------------------
(Address of principal executive offices)          (Zip Code)


                          (717) 845-7511
                      ----------------------
       (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

               ( X )  Yes            (   )  No

Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date:  At
May 14,1996 the Company had 26,956,269 shares of Common Stock
outstanding, with a par value of $.01 per share.


                          Page 1 of 18
                                    ----
                    Exhibit Index at Page  16
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                  DENTSPLY INTERNATIONAL INC.
                            FORM 10-Q

              For Quarter Ended   March 31, 1996
                                 ------------------




                               INDEX
                               -----





                                                         Page No.
                                                         --------
PART I - FINANCIAL INFORMATION (unaudited)

   Item 1 - Financial Statements
      Consolidated Condensed Balance Sheets............       3
      Consolidated Condensed Statements of Income......       4
      Consolidated Condensed Statements of Cash Flows..       5
      Consolidated Condensed Statement of
        Stockholders' Equity...........................       7
      Notes to Unaudited Consolidated Condensed
        Financial Statements...........................       8

   Item 2 - Management's Discussion and Analysis of
      Financial Condition and Results of Operations....      12


PART II - OTHER INFORMATION

   Item 1 - Legal Proceedings............................    14
   Item 6 - Exhibits and Reports on Form 8-K.............    14

   Signatures...........................................     15




















                                2






                                  PART I
                           FINANCIAL INFORMATION
                     Item 1.     FINANCIAL STATEMENTS
                        DENTSPLY INTERNATIONAL INC.
                   CONSOLIDATED CONDENSED BALANCE SHEETS
                                                               (unaudited)
                                               December 31,     March 31,
                                                   1995           1996
ASSETS                                         ------------   ------------
Current assets:                                       (in thousands)
  Cash and cash equivalents                     $   3,974      $   3,023
  Accounts and notes receivable-trade, net         93,315         92,003
  Inventories                                     125,704        129,317
  Prepaid expenses and other current assets        16,906         17,757
  Net assets of discontinued operations             5,870           -
                                                ---------      ---------
     Total Current Assets                         245,769        242,100
Property, plant and equipment, net                140,101        139,959
Other noncurrent assets, net                       13,974         15,329
Identifiable intangible assets, net                39,282         56,645
Cost in excess of fair value of net
 assets acquired, net                             149,127        200,774
                                                ---------      ---------
Total Assets                                    $ 588,253      $ 654,807
LIABILITIES AND STOCKHOLDERS' EQUITY            =========      =========
Current liabilities:
  Accounts payable and accrued liabilities      $  78,356      $  73,281
  Income taxes payable                             31,221         34,246
  Notes payable and current portion
   of long-term debt                                7,616         10,321
  Net liabilities of discontinued operations         -             2,157
                                                ---------      ---------
     Total Current Liabilities                    117,193        120,005
Long-term debt                                     68,675        121,089
Deferred income taxes                              35,927         34,916
Other liabilities                                  47,104         47,781
                                                ---------      ---------
     Total Liabilities                            268,899        323,791
                                                ---------      ---------
Minority interests in consolidated subsidiary       3,432          3,489
Stockholders' equity:                           ---------      ---------
  Preferred stock, $.01 par value; .25 million
   shares authorized; no shares issued               -              -
  Common stock, $.01 par value; 100 million
   shares authorized; 27.1 million shares
   issued at December 31, 1995 and
   March 31, 1996                                     271            271
   Capital in excess of par value                 149,999        149,980
   Retained earnings                              179,231        191,994
   Cumulative translation adjustment                3,234          1,662
   Employee stock ownership plan reserve          (12,536)       (12,156)
   Treasury stock, at cost, .1 million
   shares at December 31, 1995 and
   March 31,1996                                   (4,277)        (4,224)
                                                ---------      ---------
     Total Stockholders' Equity                   315,922        327,527
                                                ---------      ---------
Total Liabilities and Stockholders' Equity      $ 588,253      $ 654,807
                                                =========      =========
See accompanying notes to unaudited consolidated condensed financial
statements.                          3




                           DENTSPLY INTERNATIONAL INC.
                  CONSOLIDATED CONDENSED STATEMENTS OF INCOME
                                   (unaudited)

                                           Three Months Ended
                                               March 31,
                                          --------------------
                                            1995        1996
                                          --------    --------
                                 (in thousands, except per share data)

Net sales                                 $133,105    $155,910
Cost of products sold                       66,670      78,982
                                          --------    --------
                                            66,435      76,928
Selling, general and administrative
 expenses                                   43,524      50,027
                                          --------    --------
Operating income                            22,911      26,901
Interest expense                             1,606       3,095
Interest income                               (255)       (217)
Other (income) expense, net                     48      (1,066)
                                          --------    --------
Income before income taxes                  21,512      25,089
Provision for income taxes                   8,540      10,102
                                          --------    --------
Net income                                $ 12,972    $ 14,987
                                          ========    ========



Earnings per common share                    $.48       $.56

Dividends per common share                   $.075      $.0825

Weighted average common shares
 outstanding                                27,225      26,953
















See accompanying notes to unaudited consolidated condensed financial statements.


                                     4






                       DENTSPLY INTERNATIONAL INC.
              CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                (unaudited)
                                                     Three Months Ended
                                                          March 31,
                                                     -------------------
                                                       1995       1996
                                                     --------   --------
                                                        (in thousands)
Cash flows from operating activities:
   Net income                                        $ 12,972   $ 14,987
   Adjustments to reconcile net income to net
    cash provided by operating activities:
      Depreciation and amortization                     4,768      7,005
      Other, net                                      (10,251)    (3,807)
                                                     --------   --------
Net cash provided by operating activities               7,489     18,185
                                                     --------   --------
Cash flows from investing activities:
   Acquisition of businesses, net of cash acquired    (10,950)   (75,200)
   Property, plant and equipment additions             (2,716)    (4,289)
   Proceeds from disposal of Medical business            -         5,700
   Other, net                                             797       (161)
                                                     --------   --------
Net cash used in investing activities                 (12,869)   (73,950)
                                                     --------   --------
Cash flows from financing activities:
   Debt repayment                                     (11,589)   (11,138)
   Proceeds from long-term debt                        30,019     66,249
   Cash paid for treasury stock                       (38,400)      -
   Increase in bank overdrafts and other
    short term debt                                    20,888        942
   Other, net                                             485     (1,811)
                                                     --------   --------
Net cash provided by financing activities               1,403     54,242
                                                     --------   --------
Effect of exchange rate changes on cash
 and cash equivalents                                     129        572
                                                     --------   --------
Net decrease in cash and cash equivalents              (3,848)      (951)
Cash and cash equivalents at beginning of period        7,278      3,974
                                                     --------   --------
Cash and cash equivalents at end of period           $  3,430   $  3,023
                                                     ========   ========

Supplemental disclosures of cash flow information:
   Interest paid                                     $  1,006   $  1,222
   Income taxes paid                                   12,509      5,925
   Non-cash transaction: note receivable for
    proceeds from disposal of Medical business           -         1,800






See accompanying notes to unaudited consolidated condensed financial statements.

                                     5






                       DENTSPLY INTERNATIONAL INC.
              CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
                                (unaudited)


Supplemental disclosures of noncash transactions (in thousands):

In March 1995, the Company purchased all of the capital stock of KV33
Corporation for $11.5 million. In conjunction with the acquisition, liabilities
were assumed as follows:

    Fair value of assets acquired                    $ 14,329
    Cash paid for capital stock                       (11,450)
                                                     --------
    Liabilities assumed                              $  2,879
                                                     ========



In January 1996, the Company purchased certain net assets of Tulsa Dental
Products LLC for $75 million. In conjunction with the acquisition, liabilities
were assumed as follows:

     Fair value of assets acquired                   $ 78,451
     Cash paid for assets                              75,000
                                                     --------
     Liabilities assumed                             $  3,451
                                                     ========




























See accompanying notes to unaudited consolidated condensed financial statements.

                                    6







                           DENTSPLY INTERNATIONAL INC.
            CONSOLIDATED CONDENSED STATEMENT OF STOCKHOLDERS' EQUITY
                                   (unaudited)

Capital in Cumulative Total Common Excess of Retained Translation Treasury Stockholders' Stock Par Value Earnings Adjustment ESOP Reserve Stock Equity (in thousands) ------ ----------- -------- ----------- ------------ --------- ------------ Balance at December 31, 1995 $ 271 $149,999 $179,231 $ 3,234 $(12,536) $ (4,277) $315,922 Exercise of stock options and warrants --- (38) --- --- --- 53 15 Tax benefit related to stock options and warrants exercised --- 19 --- --- --- --- 19 Cash dividends declared, $.0825 per share --- --- (2,224) --- --- --- (2,224) Translation adjustment --- --- --- (1,572) --- --- (1,572) Net change in ESOP reserve --- --- --- --- 380 --- 380 Net income --- --- 14,987 --- --- --- 14,987 ------ -------- -------- ------- -------- -------- -------- Balance at March 31, 1996 $ 271 $149,980 $191,994 $ 1,662 $(12,156) $ (4,224) $327,527 ====== ======== ======== ======= ======== ======== ======== See accompanying notes to unaudited consolidated condensed financial statements.
7 DENTSPLY INTERNATIONAL INC. NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS -------------------------------------------------------------- MARCH 31, 1996 -------------- The accompanying interim consolidated condensed financial statements reflect all adjustments (consisting only of normal recurring adjustments) which in the opinion of management are necessary for a fair presentation of financial position, results of operations and cash flows for the interim periods. These interim financial statements conform with the requirements for interim financial statements and consequently do not include all the disclosures normally required by generally accepted accounting principles. Disclosures are updated where appropriate. NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES - ---------------------------------------- Principles of Consolidation - --------------------------- The consolidated condensed financial statements include the accounts of DENTSPLY International Inc. (the "Company") and its subsidiaries. Minority interests in net income of consolidated subsidiary is not material and is included in other (income) expense, net. Certain items in the prior year have been reclassified to conform to the 1996 presentation. Inventories - ----------- Inventories are stated at the lower of cost or market. At December 31, 1995 and March 31, 1996, the cost of $10.6 million or 8% and $11.2 million or 8%, respectively, of inventories was determined by the last-in, first-out (LIFO) method. The cost of other inventories was determined by the first-in, first-out or average cost method. Property, Plant and Equipment - ----------------------------- Property, plant and equipment are stated at cost, net of accumulated depreciation. Except for leasehold improvements, depreciation for financial reporting purposes is computed by the straight-line method over the following estimated useful lives: buildings - generally 40 years; and machinery and equipment - 8 to 15 years. The cost of leasehold improvements is amortized over the shorter of the estimated useful life or the term of the lease. For income tax purposes, depreciation is computed using various methods. 8 Earnings per Common Share - ------------------------- Earnings per common share are based on the weighted average number of common shares outstanding. Common stock equivalents (options and warrants) had no material effect on the earnings per common share computation. All shares held by the DENTSPLY Employee Stock Ownership Plan are considered outstanding and are included in the earnings per common share computation. NOTE 2 - BUSINESS ACQUISITIONS - ------------------------------ In January 1996, the Company purchased certain assets of Tulsa Dental Products L.L.C. ("Tulsa") in a cash transaction valued at $75 million. Based in Tulsa, Oklahoma, Tulsa is a manufacturer and distributor of principally endodontic instruments and materials. The acquisition was accounted for under the purchase method of accounting and the results of Tulsa's operations have been included in the accompanying financial statements since the date of acquisition. The aggregate purchase price of $75 million plus direct acquisition costs has been allocated on the basis of preliminary estimates of the fair values of assets acquired and liabilities assumed. The excess ($54.7 million) of acquisition cost over net assets acquired is being amortized over 25 years. The following unaudited pro forma consolidated results of operations assume that the acquisition of Tulsa occurred on January 1, 1995: Three Months Ended March 31, 1995 1996 -------- -------- (in thousands, except per share amounts) Net sales $137,459 $155,910 Net income 12,367 15,139 Earnings per common share .45 .56 The pro forma information does not purport to be indicative of the results that actually would have been obtained had the operations been combined during the periods presented. In March 1995, the Company purchased all of the outstanding capital stock of KV33 Corporation ("KV33") in a cash transaction valued at $11.5 million. The acquisition was accounted for under the purchase method of accounting and the results of KV33's operations have been included in the accompanying financial statements since the date of acquisition. The excess ($10.2 million) of acquisition cost over net assets acquired is being amortized over 25 years. Pro forma information has been omitted due to immateriality. 9 NOTE 3 - INVENTORIES - -------------------- Inventories consist of the following: December 31, March 31, 1995 1996 ------------ ------------ (in thousands) Finished goods $ 70,677 $ 72,857 Work-in-process 26,440 27,806 Raw materials and supplies 28,587 28,654 -------- -------- $125,704 $129,317 ======== ======== Pre-tax income was $.3 million and .1 million lower in the three months ended March 31, 1995 and 1996, respectively, as a result of using the LIFO method compared to the first-in, first-out (FIFO) method. If the FIFO method had been used to determine the cost of the LIFO inventories, the amounts at which net inventory is stated would be lower than reported at December 31, 1995 and March 31, 1996 by $2.0 million and $1.9 million, respectively. NOTE 4 - PROPERTY, PLANT AND EQUIPMENT - -------------------------------------- Property, plant and equipment consist of the following: December 31, March 31, 1995 1996 ------------ ------------ Assets, at cost: (in thousands) Land $ 17,395 $ 17,004 Buildings and improvements 67,903 67,475 Machinery and equipment 88,417 90,982 Construction in progress 9,039 10,442 -------- -------- 182,754 185,903 Less: Accumulated depreciation 42,653 45,944 -------- -------- $140,101 $139,959 ======== ======== 10 NOTE 5- DISCONTINUED OPERATIONS - -------------------------------- On October 13, 1994, the Company announced its strategic decision to discontinue the operations comprising its medical business. The medical operations include Eureka X-Ray Tube Corp. (Eureka), GENDEX Medical and CMW business units which manufacture medical x-ray tubes, medical x-ray systems and orthopedic bone cement, respectively. The net assets of CMW and substantially all of the net assets of Eureka were sold in the fourth quarter of 1994. Substantially all of the remaining assets comprising the medical business were sold in the first quarter of 1996 for $5.7 million in cash and a note receivable for $1.8 million. Sales from these operations were $5.2 million and $2.7 million for the three months ended March 31, 1995 and 1996, respectively. The components of net assets (liabilities) of discontinued operations included in the Consolidated Condensed Balance Sheets are as follows: December 31, March 31, 1995 1996 ------------ ------------ (in thousands) Accounts and notes receivable-trade, net $ 2,105 $ 1,070 Inventories 6,550 821 Deferred income taxes 4,611 3,565 Prepaid expenses and other current assets 174 - Property, plant and equipment, net 2,644 1,974 Other noncurrent assets, net 2,331 - Cost in excess of fair value of net assets acquired, net 3,348 - Accounts payable and accrued liabilities (10,149) (7,304) Other liabilities (5,744) (2,283) -------- -------- $ 5,870 $ (2,157) ======== ======== NOTE 6- NOTES PAYABLE AND LONG-TERM DEBT - ----------------------------------------- The increases from December 31, 1995 in Notes payable and current portion of long-term debt ($2.7 million) and Long-term debt ($52.4 million) were primarily due to utilization of the Company's credit facilities for the purchase of certain assets of Tulsa Dental Products LLC for $75 million. 11 DENTSPLY INTERNATIONAL INC. Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations RESULTS OF OPERATIONS Quarter Ended March 31, 1996 Compared to Quarter Ended March 31, 1995 In the quarter ended March 31, 1996, net sales increased $22.8 million, or 17.1%, to $155.9 million from $133.1 in the same period of 1995. The increase primarily came from acquisitions and very strong sales growth in the Pacific Rim and Latin America. Gross profit increased $10.5 million, or 15.8%, to $76.9 million from $66.4 million in the first quarter of 1995 as a result of higher net sales. As a percentage of sales, gross profit decreased from 49.9% in the first quarter of 1995 to 49.3% in the same period of 1996. Improvements in the gross profit percentage in the first quarter of 1996 were more than offset by the adverse impact of acquisition accounting for Maillefer and Tulsa. Selling, general and administrative expenses increased $6.5 million, or 14.9%. As a percentage of sales, expenses decreased from 32.7% in the first quarter of 1995 to 32.1% for the same period in 1996 due to lower spending levels compared to sales in the United States and Europe. The percentage of sales improvement was offset somewhat by spending for expansion in Asia and the Pacific Rim, including establishing operating facilities in India and the Philippines. The $1.5 million increase in net interest expense is primarily due to acquistion debt. The $1.1 million increase in other income is primarily due to a legal settlement in the Company's favor. Income before income taxes increased $3.6 million, or 16.6%, while net income increased $2.0 million, or 15.5%, from the first quarter of 1995. The Company's effective tax rate on income before income taxes increased from 39.7% in the three months ended March 31, 1995 to 40.3% for the three months ended March 31, 1996. Earnings per common share increased from $.48 in 1995 to $.56 in 1996, or 16.7%. The weighted average number of common shares outstanding decreased one percent from the prior period due to the buyback of stock during 1995. LIQUIDITY AND CAPITAL RESOURCES In January 1996, the Company acquired the dental manufacturing and distribution operations of Tulsa for $75.0 million in cash and an earn-out based on the operating performance of the acquired business. The transaction was funded from the Company's existing $175.0 million Bank Revolving Loan Facility and short-term bank borrowings. Investing activities for the three months ended March 31, 1996 include capital expenditures of $4.3 million. Excluding the net assets of discontinued operations, the Company's current ratio was 2.1 with working capital of $124.2 million at March 31, 1996. This compares with a current ratio of 2.0 and working capital of $122.7 million at December 31, 1995. 12 The Company expects to be able to finance cash requirements, including capital expenditures, stock repurchases and debt service from the funds generated from operations and amounts available under the existing Revolving Loan Facility. For the three months ended March 31, 1996, cash flows from operating activities were $18.2 million compared to $7.5 million for the three months ended March 31, 1995. The increase of $10.7 million results from higher sales and gross margins in 1996, while cash flows in 1995 were adversely impacted by income tax payments on the gain from disposal of the medical business. IMPACT OF INFLATION The Company has generally offset the impact of inflation on wages and the cost of purchased materials by improving operating efficiencies and increasing selling prices to the extent permitted by market conditions. 13 PART II OTHER INFORMATION Item 1 - Legal Proceedings The Company and its subsidiaries are from time to time parties to lawsuits arising out of their respective operations. The Company believes that pending litigation to which it is a party will not have a material adverse effect upon its consolidated financial position or results of operations. Item 6 - Exhibits and Reports on Form 8-K (a) Exhibits. The following exhibits are filed herewith: --------- Number Description ------ ----------- 11 Statement regarding computation of earnings per share. 27 Financial Data Schedule (pursuant to Item 601(c)(1)(iv) of Regulation S-K, this exhibit shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended) (b) Reports on Form 8-K ------------------- On January 25, 1996 the Company filed a Form 8-K (Items 2 and 7) reporting the acquisition of Tulsa Dental Products, LLC. Amendment No. 1 to this Form 8-K was filed on Form 8-K/A on March 25, 1996. Financial statements filed with Form 8-K/A were as follows: (1) Financial statements of Tulsa Dental Products LLC for the year ended December 31, 1995 (a) Balance Sheet (b) Statement of Income (c) Statement of Cash Flows (d) Notes to the Financial Statements (2) Pro Forma Financial Information (a) Pro Forma Condensed Consolidated Balance Sheet as of December 31, 1995 (b) Pro Forma Condensed Consolidated Statement of Income for the year ended December 31, 1995. (c) Notes to Unaudited Pro Forma Condensed Consolidated Financial Information 14 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 thereunto duly authorized. DENTSPLY INTERNATIONAL INC. May 15, 1996 /s/ John C. Miles II - -------------------- ----------------------------------- Date John C. Miles II President and Chief Executive Officer May 15, 1996 /s/ Edward D. Yates - -------------------- ----------------------------------- Date Edward D. Yates Senior Vice President and Chief Financial Officer 15 EXHIBIT INDEX ------------- Number Description Sequential Page No. ------ ----------- ------------------- 11 Statement regarding computation 17 of earnings per share. 27 Financial Data Schedule 18 (pursuant to Item 601(c)(1)(iv) of Regulation S-K, this exhibit shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended) 16

                           DENTSPLY INTERNATIONAL INC.
                                   EXHIBIT 11
                        COMPUTATION OF EARNINGS PER SHARE




Earnings per common share:
- --------------------------



                                             Three Months Ended
                                                  March 31,
                                             ------------------
                                               1995      1996
                                             --------  --------
                                  (in thousands, except per share data)

Weighted average common shares
 outstanding                                   27,225    26,953



Net income                                    $12,972   $14,987



Earnings per common share                        $.48      $.56












                                      

















                                    17
 


 

5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS OF DENTSPLY INTERNATIONAL INC. AT MARCH 31, 1996 AND FOR THE FISCAL QUARTER THEN ENDED, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1000 3-MOS DEC-31-1996 JAN-01-1996 MAR-31-1996 3023 0 92003 0 129317 242100 185903 45944 654807 120005 121089 0 0 271 327256 654807 155910 155910 78982 78982 50027 0 3095 25089 10102 14987 0 0 0 14987 .56 0