SOURCE: Bio-Rad Laboratories

November 06, 2007 16:03 ET

Bio-Rad Reports Third-Quarter 2007 Financial Results

HERCULES, CA--(Marketwire - November 6, 2007) - Bio-Rad Laboratories, Inc. (AMEX: BIO) and (AMEX: BIOb), a multinational manufacturer and distributor of life science research and clinical diagnostic products, announced financial results today for the third quarter ended September 30, 2007.

Third-quarter revenues were $339.7 million in 2007, up 11.5% compared to $304.8 million reported for the same period in 2006. These results were driven by continued growth across product areas in both the Life Science and Clinical Diagnostics segments. On a currency-neutral basis, revenues increased 8.0% compared to the same period last year.

Net income for the third quarter in 2007 was $28.0 million compared to $23.2 million reported for the same period in 2006. Third-quarter net income in 2006 benefited from a pre-tax investment gain of $4.7 million. Net income for the third quarter in 2007 was $1.05 per share, or $1.03 per share on a fully diluted basis, compared to $0.88 and $0.86, respectively, during the same quarter last year. Third-quarter gross margin was 55.4% compared to 54.7% in the third quarter last year.

Year-to-date revenues grew by 7.6% to $1.0 billion compared to the first three quarters in 2006. Normalizing for the impact of currency effects, growth was 3.8%. Year-to-date net income for 2007 was $80.6 million compared to $86.6 million in the same period last year. Year-to-date results for the first three quarters in 2006 was favorably impacted by one-time additional revenue of $11.7 million resulting from a licensing settlement agreement reached with bioMérieux as well as the aforementioned pre-tax investment gain of $4.7 million. Year-to-date gross margin was 55.7% compared to 56.6% in the same period in 2006.

On a per share basis, year-to-date net income for 2007 was $3.03 per share, or $2.96 per share on a fully diluted basis, and $3.29 and $3.22, respectively, for the same period of 2006.

"We are pleased with the Company's performance during the quarter and encouraged by the success of new products," said Norman Schwartz, Bio-Rad President and Chief Executive Officer. "As we wrap up the year, we will continue to focus on our ongoing businesses and work to integrate the recently acquired DiaMed into Bio-Rad's organization."

Life Science

Life Science segment net sales for the quarter were $143.0 million, up 4.1% compared to the same period last year. On a currency-neutral basis, segment sales increased by 1.2%. Performance in the Life Science segment benefited from sales of the new ProteOn™ XPR36 protein interaction array system as well as the Bio-Plex® suspension array systems and reagents. Bio-Plex suspension array system sales continue to be boosted by the over 50 new assays that were introduced in 2006. Sales of process chromatography media, particularly CHT™ Ceramic Hydroxyapatite, were strong as the products continued to gain broad market acceptance. These materials are used in the purification stages in the manufacture of a variety of pharmaceuticals with a particular applicability to monoclonal antibody based medicines. Sales results in this segment were somewhat tempered by continued erosion of BSE (bovine spongiform encephalopathy) testing revenue.

Clinical Diagnostics

The Clinical Diagnostics segment reported net sales of $193.3 million for the quarter, up 17.6% compared to the third quarter last year, or 13.5% excluding currency effects. These gains were the result of strong sales across all product lines, particularly in quality control, auto-immune, diabetes, and blood virus testing products. During the quarter, Bio-Rad launched a test for syphilis for use on its BioPlex® 2200 system, a fully-automated random access multiplex testing system that can generate multiple results from a single patient sample. The BioPlex 2200 Syphilis IgG kit simultaneously detects three of the most clinically relevant bacteria that cause syphilis. In September, the Company received FDA clearance to market the MRSASelect™ test, a chromogenic medium used for the rapid screening of MRSA (methicillin resistant Staphylococcus aureus). With high sensitivity and specificity as well as rapid and direct identification, the MRSASelect test can identify MRSA carriers in 24 hours. Also during the quarter, the Company released the Dengue NS1 Ag STRIP rapid test. The test provides early diagnosis of dengue acute infections, a tropical disease transmitted to humans from mosquitoes.

In the beginning of the fourth quarter of 2007, Bio-Rad completed the purchase of 77.7% of Switzerland-based DiaMed Holding AG for approximately $409 million in cash. DiaMed develops, manufactures, and markets a complete line of reagents and instruments used in blood typing and screening and has annual sales of approximately $200 million. DiaMed's results will be included in our consolidated financial statements beginning in the fourth quarter of 2007.

Management will discuss these results in a conference call at 2 PM Pacific Time (5 PM Eastern Time) November 6, 2007. Interested parties can access the call by dialing 800-510-9834 (in the U.S.), or 617-614-3669 (international), access number 71052630. The live webcast can be accessed at http://www.bio-rad.com. A replay of the call will be available at 888-286-8010 (in the U.S.), or 617-801-6888 (international), access number 61856426, for seven days following the call and the webcast can be accessed at http://www.bio-rad.com for 30 days.

About Bio-Rad

Bio-Rad Laboratories, Inc. (AMEX: BIO) and (AMEX: BIOb) has remained at the center of scientific discovery for more than 50 years manufacturing and distributing a broad range of products for the life science research and clinical diagnostic markets. The Company is renowned worldwide among hospitals, universities, major research institutions, as well as biotechnology and pharmaceutical companies for its commitment to quality and customer service. Founded in 1952, Bio-Rad is headquartered in Hercules, California, and serves more than 85,000 research and industry customers worldwide through its global network of operations. The Company employs over 6,300 people globally and had revenues of nearly $1.3 billion in 2006. For more information, visit www.bio-rad.com.

This release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally can be identified by the use of forward-looking terminology such as, "believe," "expect," "may," "will," "intend," "estimate," "continue," or similar expressions or the negative of those terms or expressions. Such statements involve risks and uncertainties, which could cause actual results to vary materially from those expressed in or indicated by the forward-looking statements. For further information regarding the Company's risks and uncertainties, please refer to the "Risk Factors" in the Company's public reports filed with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2006, as updated by subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. The Company cautions you not to place undue reliance on forward-looking statements, which reflect an analysis only and speak only as of the date hereof. Bio-Rad Laboratories, Inc., disclaims any obligation to update these forward-looking statements.


                        Bio-Rad Laboratories, Inc.
                Condensed Consolidated Statements of Income

                  (in thousands, except per share data)
                                (UNAUDITED)


                           Three Months Ended         Nine Months Ended
                              September 30,             September 30,
                        ------------------------  ------------------------
                            2007         2006         2007         2006
                        -----------  -----------  -----------  -----------
Net sales               $   339,742  $   304,764  $ 1,001,364  $   930,849
Cost of goods sold          151,385      137,975      443,635      403,870
                        -----------  -----------  -----------  -----------
Gross profit                188,357      166,789      557,729      526,979

Selling, general, and
 administrative expense     117,687      105,950      344,988      316,486
Product research and
 development expense         33,145       30,988      100,680       90,050
Interest expense              7,847        8,212       23,583       24,111
Foreign exchange
 (gains) losses, net            257         (293)        (413)         959
Other (income) expense,
 net                         (5,687)     (10,514)     (19,368)     (22,809)
                        -----------  -----------  -----------  -----------
Income before taxes          35,108       32,446      108,259      118,182
Provision for income
 taxes                        7,137        9,296       27,620       31,568
                        -----------  -----------  -----------  -----------
Net income              $    27,971  $    23,150  $    80,639  $    86,614
                        ===========  ===========  ===========  ===========

Basic earnings per
 share
     Net income         $      1.05  $      0.88  $      3.03  $      3.29
                        ===========  ===========  ===========  ===========

     Weighted average
      common shares          26,715       26,407       26,651       26,342
                        ===========  ===========  ===========  ===========

Diluted earnings per
 share
     Net income         $      1.03  $      0.86  $      2.96  $      3.22
                        ===========  ===========  ===========  ===========

     Weighted average
      common shares          27,270       26,971       27,197       26,900
                        ===========  ===========  ===========  ===========


                        Bio-Rad Laboratories, Inc.
                  Condensed Consolidated Balance Sheets

                              (in thousands)
                                (UNAUDITED)


                                                September 30, December 31,
                                                    2007          2006
                                                ------------- -------------
Current assets:
     Cash and cash equivalents                  $     472,792 $     223,607
     Short-term investments                            70,613       264,473
     Accounts receivable, net                         303,201       292,970
     Inventories, net                                 273,575       253,045
     Other current assets                              99,381        95,682
                                                ------------- -------------
              Total current assets                  1,219,562     1,129,777

Net property, plant, and equipment                    201,608       189,627
Goodwill                                              121,492       119,492
Purchased intangibles, net                             42,535        44,605
Other assets                                          127,287       112,667
                                                ------------- -------------
          Total assets                          $   1,712,484 $   1,596,168
                                                ============= =============


Current liabilities:
     Notes payable and current maturities of
      long-term debt                            $       4,907 $       3,042
     Accounts payable                                  68,102        83,411
     Accrued payroll and employee benefits             89,769        92,101
     Sales, income, and other taxes payable            14,885        19,949
     Other current liabilities                        108,798       121,030
                                                ------------- -------------
              Total current liabilities               286,461       319,533

Long-term debt, net of current maturities             426,141       425,625
Other long-term liabilities                            53,542        31,472
Stockholders' equity                                  946,340       819,538
                                                ------------- -------------
          Total liabilities and stockholders'
           equity                               $   1,712,484 $   1,596,168
                                                ============= =============


                        Bio-Rad Laboratories, Inc.
              Condensed Consolidated Statements of Cash Flows

                              (In thousands)
                                (UNAUDITED)


                                                       Nine Months
                                                    Ended September 30,
                                                    2007          2006
                                                ------------  ------------

Cash flows from operating activities:
     Cash received from customers               $  1,007,292  $    915,289
     Cash paid to suppliers and employees           (880,104)     (789,626)
     Interest paid                                   (24,008)      (24,528)
     Income tax payments                             (32,720)       (9,595)
     Litigation settlement                            (3,147)      (45,963)
     Other operating activities                       21,116        17,789
                                                ------------  ------------
     Net cash provided by operating activities        88,429        63,366

Cash flows from investing activities:
     Capital expenditures, net                       (45,938)      (38,079)
     Receipt of restricted cash                            -        36,138
     Other investing activities                      185,996      (132,102)
                                                ------------  ------------
     Net cash provided by (used in) investing
      activities                                     140,058      (134,043)

Cash flows from financing activities:
     Proceeds from issuance of common stock            9,109         8,511
     Other financing activities                        3,481         1,051
                                                ------------  ------------
     Net cash provided by financing activities        12,590         9,562

Effect of exchange rate changes on cash                8,108         2,817

                                                ------------  ------------
Net increase (decrease) in cash and cash
 equivalents                                         249,185       (58,298)
Cash and cash equivalents at beginning of year       223,607       296,716
                                                ------------  ------------
Cash and cash equivalents at end of period      $    472,792  $    238,418
                                                ============  ============


Reconciliation of net income to net cash
 provided by operating activities:

Net income                                      $     80,639  $     86,614

Adjustments to reconcile net income to net
 cash provided by operating activities:
     Depreciation and amortization                    43,406        40,300
     Changes in working capital                      (43,570)      (29,876)
     Litigation settlement                            (3,147)      (45,963)
     Other                                            11,101        12,291
                                                ------------  ------------
Net cash provided by operating activities       $     88,429  $     63,366
                                                ============  ============

Contact Information

  • For more information contact:
    Christine Tsingos
    Vice President and Chief Financial Officer
    Ron Hutton
    Treasurer
    Bio-Rad Laboratories, Inc.
    510-724-7000
    Email Contact