SOURCE: Bio-Rad Laboratories

February 24, 2011 16:20 ET

Bio-Rad Reports Record Fourth-Quarter and Full-Year 2010 Financial Results

HERCULES, CA--(Marketwire - February 24, 2011) - Bio-Rad Laboratories, Inc. (NYSE: BIO) and (NYSE: BIO.B), a multinational manufacturer and distributor of life science research and clinical diagnostic products, announced financial results today for the fourth quarter and fiscal year ended December 31, 2010.

Fourth-quarter reported revenues were $533.7 million, up 7.8% compared to $495.1 million reported for the fourth quarter of 2009. On a currency-neutral basis, quarterly revenues increased 9.9% compared to the same period last year. This increase was the result of organic growth across Bio-Rad's two main areas, Life Science and Clinical Diagnostics as well as revenue of $15.3 million resulting from the acquisition of certain diagnostics businesses of Biotest AG, which were added to the Company's portfolio in the first quarter of 2010. Excluding the revenue from the Biotest acquisition, fourth-quarter revenues were up 6.7% on a currency neutral basis. Fourth-quarter gross margin increased to 56.2% compared to 54.2% during the same quarter last year.

Net income attributable to Bio-Rad for the fourth quarter of 2010 was $67.9 million, or $2.41 per share on a fully diluted basis compared to $1.35 per share, during the same period last year. In December, the Company refinanced a portion of its long-term debt issuing $425 million of senior debt. Proceeds were used to retire $200 million of subordinated debt in December and, subsequent to year end, $225 million of subordinated debt. The effect of this transaction on pretax earnings for the fourth quarter of 2010 was $5.3 million, which is included in interest expense.

The tax provision for the fourth quarter was a benefit of $10.7 million. This extraordinary fourth-quarter provision benefit includes the repatriation of foreign earnings to the U.S. and the favorable impact of the extension of the U.S. Research and Experimentation tax credit. Without these two items, the fourth-quarter effective tax rate would have been approximately 25%.

For the full year, sales grew by 8.0% to $1,927.1 million compared to $1,784.2 million in 2009. Year over year, there was insignificant currency impact on sales growth. Full-year net income attributable to Bio-Rad was $185.5 million, or $6.59 per share on a fully diluted basis, compared to $144.6 million, or $5.20 per share, respectively, in 2009. Full-year gross margin increased to 56.6% compared to last year's figure of 56.0%.

"We are pleased by our performance during the fourth quarter and the entire year," said Norman Schwartz, Bio-Rad President and Chief Executive Officer. "In spite of a cautious business environment in the U.S. and Europe throughout 2010, we are encouraged by customer acceptance of several new products including our TC10™ automated cell counter and our IH-1000 automated blood typing platform. Although continued economic pressure from European markets is predicted, we expect 2011 to be another year of progress for Bio-Rad."

Life Science

The Life Science segment net sales for the fourth quarter were $192.9 million, up 1.0% compared to the same period last year. On a currency-neutral basis, Life Science segment sales increased by 2.2%. Full-year reported revenues for the Life Science segment were $648.1 million, up 2.6% over the prior year, or an increase of 2.2% on a currency-neutral basis. European sales continued to lag in the fourth quarter as a result of weak economic conditions facing government-funded research. During the quarter, the Life Science segment benefited from sales of precast electrophoresis gels as well as its next generation PCR instruments, in particular, the CFX96™ real-time PCR detection system.

The TC10 automated cell counter also continued to gain rapid customer acceptance on a global basis. In November, Bio-Rad launched the Criterion® TGX Stain-Free™ precast electrophoresis gels which, when combined with Bio-Rad's Gel Doc™ EZ imager, provide researchers with the fastest protein separation and visualization available.

Clinical Diagnostics

The Clinical Diagnostics segment reported net sales of $336.5 million for the fourth quarter, up 12.0% compared to the same period in 2009. On a currency-neutral basis, net sales were up 14.7%. These results include additional revenue of $15.3 million from the diagnostics businesses of Biotest AG that were added to the Company's portfolio in the first quarter of 2010. Excluding revenue from the Biotest acquisition, net sales were up 9.3% on a currency-neutral basis compared to the same quarter last year. Full-year reported revenues for the Clinical Diagnostics segment were $1,265.3 million, an increase of 11.0% over the prior year. On a currency-neutral basis, full-year sales increased 11.3% compared to 2009 results. Excluding revenue from the Biotest acquisition, full-year sales increased 6.3% on a currency neutral basis. Performance in the Clinical Diagnostics segment during the fourth quarter was the result of growth across all product lines, most notably quality controls, blood typing, diabetes monitoring, as well as sales of the BioPlex 2200® system. During the fourth quarter, the Company announced FDA clearance and the U.S. launch of Bio-Rad's BioPlex® 2200 Anti-CCP test for the early detection of rheumatoid arthritis. This novel marker has been shown to have superior diagnostic specificity.

2010 Full-Year Highlights

--  Full-year Company sales grew by 8.0% to $1,927.1 million.
--  Year-over-year net income was $185.5 million, or $6.59 per share on a
    fully diluted basis, compared to $144.6 million, or $5.20 per share in
    2009.
--  In January, Bio-Rad completed the purchase of certain diagnostics
    businesses of Biotest AG including its diagnostics products in the
    areas of blood transfusion testing, transplantation, and infectious
    diseases.
--  Also, in January, Bio-Rad announced the launch of a new Anti-CCP test
    for markets outside the U.S. for its BioPlex 2200 system for the early
    detection of rheumatoid arthritis. After receiving FDA clearance later
    in the year, the product was launched in the U.S.     
--  In March, Bio-Rad announced the launch of the Mini-PROTEAN® TGX™
    precast gels that provide researchers with the fastest running, long
    shelf life precast gels for protein electrophoresis.
--  In May, Bio-Rad introduced the TC10 automated cell counter, which
    accurately and reproducibly provides total mammalian cell counts in 30
    seconds, eliminating the need for manually counting cells.
--  Also in May, the Clinical Diagnostics segment announced the launch of
    the BioPlex® 2200 MMRV IgG kit (measles, mumps, rubella, and the
    varicella-zoster virus) for use on the company's BioPlex 2200 system.
--  During the second quarter, Bio-Rad received notification from the FDA
    that it could proceed with an Investigational New Drug Study for its
    Dengue NS1 Ag microplate assay.
--  In June, Bio-Rad announced the launch of its IH-1000 blood screening
    system for markets outside the U.S.
--  In July, Bio-Rad submitted Premarket Approval application to the FDA
    for its fourth-generation HIV assay, the GS HIV Combo Ag/Ab EIA (enzyme
    immunoassay), offering early detection of HIV infections as well as
    acute HIV infections.
--  In September, Bio-Rad announced the launch of the Gel Doc EZ imager,
    the first gel documentation system that provides publication-quality
    images and analysis in seconds.
--  In November, the Life Science segment launched Criterion TGX Stain-Free
    precast gels which, when combined with Bio-Rad's Gel Doc EZ imager,
    provide researchers with the fastest protein separation and
    visualization available.
--  In December, Bio-Rad successfully issued $425 million of senior debt.
    As a result of that transaction, the Company redeemed $200 million of
    subordinated debt originally due in 2014. Subsequently, in January
    2011, the Company redeemed $225 million of subordinated debt originally
    due 2013.

Internal Control Over Financial Reporting

In connection with our audit committee's ongoing investigation of our compliance with the FCPA, our management identified three significant deficiencies in our internal control over financial reporting as of December 31, 2010 that, when considered and taken together, constitute a material weakness in our internal control over financial reporting as of December 31, 2010. Our conclusion that we have a material weakness in our internal control over financial reporting as of December 31, 2010 is not based on quantified misstatements in our historical financial statements or our financial statements as of and for our fiscal quarter and year ended December 31, 2010, but instead on the risk that we may be unable to prevent or detect on a timely basis potential material errors in our future financial statements. We do not presently anticipate that the material weakness in our internal control over financial reporting as of December 31, 2010 will have any material effect on our previously reported financial results or our financial results for our fiscal quarter or year ended December 31, 2010. Our Annual Report on Form 10-K for our fiscal year ended December 31, 2010 will contain more information about these three significant deficiencies and the resulting material weakness and the measures that we have initiated and are considering initiating to attempt to remediate it.

Management will discuss these results in a conference call at 2 PM Pacific Time (5 PM Eastern Time) February 24, 2011. Interested parties may access the call by dialing 866-202-0886 (in the U.S.) or 617-213-8841 (international), access number 25027707.

A live webcast of the conference call may be accessed in the "Investor Relations" section of 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 51107717, for seven days following the call. The webcast of the call will be archived on the Bio-Rad site for on-demand replay for up to a year and may be accessed in the "Investor Relations" section of www.bio-rad.com.

About Bio-Rad

Bio-Rad Laboratories, Inc. (NYSE: BIO) and (NYSE: BIO.B), 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 6,800 people globally and had revenues exceeding $1.9 billion in 2010. 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 most recent Annual Report on Form 10-K, 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        Twelve Months Ended
                               December 31,             December 31,
                        ------------------------  ------------------------
                            2010         2009         2010         2009
                        -----------  -----------  -----------  -----------
Net sales               $   533,720  $   495,073  $ 1,927,118  $ 1,784,244
   Cost of goods sold       233,997      226,604      835,630      784,401
                        -----------  -----------  -----------  -----------
Gross profit                299,723      268,469    1,091,488      999,843

   Selling, general and
    administrative
    expense                 176,672      163,862      635,213      601,468
   Product research and
    development expense      45,267       44,510      172,266      163,585
   Impairment losses on
    goodwill and
    long-lived assets             -        3,802            -        3,802
                        -----------  -----------  -----------  -----------
Income from operations       77,784       56,295      284,009      230,988

   Interest expense          20,548       14,363       63,717       47,024
   Foreign exchange
    losses                      338        1,754        3,884        5,003
   Other (income)
    expense, net               (303)      (1,915)      (3,875)      (6,871)
                        -----------  -----------  -----------  -----------
Income before taxes          57,201       42,093      220,283      185,832

   (Provision) benefit
    for income taxes         10,736       (3,571)     (33,348)     (36,667)
                        -----------  -----------  -----------  -----------
Net income including
 noncontrolling
 interests                   67,937       38,522      186,935      149,165

   Less: Net income
    attributable to
    noncontrolling
    interests                   (29)        (660)      (1,445)      (4,545)
                        -----------  -----------  -----------  -----------
Net income attributable
 to Bio-Rad             $    67,908  $    37,862  $   185,490  $   144,620
                        ===========  ===========  ===========  ===========

Basic earnings per
 share:
   Net income per share
    basic attributable
    to Bio-Rad          $      2.44  $      1.38  $      6.70  $      5.28
                        ===========  ===========  ===========  ===========

   Weighted average
    common shares -
    basic                    27,808       27,491       27,665       27,404
                        ===========  ===========  ===========  ===========

Diluted earnings per
 share:
   Net income per share
    diluted
    attributable to
    Bio-Rad             $      2.41  $      1.35  $      6.59  $      5.20
                        ===========  ===========  ===========  ===========

   Weighted average
    common shares -
    diluted                  28,233       28,006       28,151       27,828
                        ===========  ===========  ===========  ===========






                        Bio-Rad Laboratories, Inc.
                  Condensed Consolidated Balance Sheets
                              (In thousands)
                                (UNAUDITED)


                                                  December 31, December 31,
                                                      2010         2009
                                                  ------------ ------------
Current assets:
   Cash and cash equivalents                      $    906,551 $    649,938
   Restricted cash                                       6,422            -
   Short-term investments                              118,636       94,876
   Accounts receivable, net                            387,996      345,734
   Inventories                                         398,100      351,206
   Other current assets                                157,641      120,920
                                                  ------------ ------------
      Total current assets                           1,975,346    1,562,674

Property, plant and equipment, net                     333,617      302,417
Goodwill, net                                          363,981      327,626
Purchased intangibles, net                             203,881      204,779
Other assets                                           185,939      138,357
                                                  ------------ ------------
      Total assets                                $  3,062,764 $  2,535,853
                                                  ============ ============



Current liabilities:
   Accounts payable                               $    113,440 $     92,988
   Accrued payroll and employee benefits               131,381      126,702
   Notes payable and current maturities of
    long-term debt                                     233,181        5,132
   Income and other taxes payable                       50,935       42,322
   Other current liabilities                           137,690      152,828
                                                  ------------ ------------
      Total current liabilities                        666,627      419,972

Long-term debt, net of current maturities              731,100      737,919
Other long-term liabilities                            124,518       98,749
                                                  ------------ ------------
      Total liabilities                              1,522,245    1,256,640

Bio-Rad stockholders' equity                         1,536,696    1,259,726
Noncontrolling interests                                 3,823       19,487
                                                  ------------ ------------
      Total stockholders' equity                     1,540,519    1,279,213
                                                  ------------ ------------
      Total liabilities and stockholders' equity  $  3,062,764 $  2,535,853
                                                  ============ ============





                        Bio-Rad Laboratories, Inc.
              Condensed Consolidated Statements of Cash Flows
                              (In thousands)
                                (UNAUDITED)


                                                        Year Ended
                                                        December 31,
                                                      2010         2009
                                                  -----------  -----------

Cash flows from operating activities:
   Cash received from customers                   $ 1,877,483  $ 1,778,316
   Cash paid to suppliers and employees            (1,536,935)  (1,386,382)
   Interest paid                                      (59,834)     (38,471)
   Income tax payments                                (55,502)     (37,749)
   Other operating activities                             697        9,360
                                                  -----------  -----------
   Net cash provided by operating activities          225,909      325,074

Cash flows from investing activities:
   Payments for acquisitions and long-term
    investments                                       (89,307)     (35,990)
   Other investing activities                        (127,205)    (139,962)
                                                  -----------  -----------
   Net cash used in investing activities             (216,512)    (175,952)

Cash flows from financing activities:
   Long-term borrowings                               424,633      294,750
   Payments on long-term debt                        (206,706)      (6,823)
   Other financing activities                          10,818        6,006
                                                  -----------  -----------
   Net cash provided by financing activities          228,745      293,933

Effect of foreign exchange rate changes on cash        18,471        2,359
                                                  -----------  -----------

Net increase in cash and cash equivalents             256,613      445,414
Cash and cash equivalents at beginning of year        649,938      204,524
                                                  -----------  -----------
Cash and cash equivalents at end of period        $   906,551  $   649,938
                                                  ===========  ===========


Reconciliation of net income including
 noncontrolling interests to net cash provided
 by operating activities:

Net income including noncontrolling interests     $   186,935  $   149,165
Adjustments to reconcile net income including
 noncontrolling interests to net cash provided
 by operating activities:
      Depreciation and amortization                   108,911      101,682
      Impairment expense                                    -        3,802
      Changes in working capital                      (72,350)      66,707
      Other                                             2,413        3,718
                                                  -----------  -----------
Net cash provided by operating activities         $   225,909  $   325,074
                                                  ===========  ===========

Contact Information

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