SOURCE: Bio-Rad Laboratories

Bio-Rad Laboratories

November 04, 2014 16:27 ET

Bio-Rad Reports Third-Quarter 2014 Financial Results

HERCULES, CA--(Marketwired - Nov 4, 2014) - 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 third quarter ended September 30, 2014.

Third-quarter reported revenues were $530.6 million, an increase of 5.1% compared to $505.1 million reported for the third quarter of 2013. On a currency-neutral basis, quarterly revenues increased 4.3% compared to the same period last year. Third-quarter gross margin was 54.4%, compared to 56.3% during the same quarter in 2013. Gross margin during the quarter was negatively impacted by $3.1 million of expenses related to the closing and consolidation of some small manufacturing locations. Margins were also negatively affected by continued pricing pressures in the diagnostics markets. 

Net income for the third quarter was $11.5 million, or $0.39 per share on a fully diluted basis, compared to a net loss of ($7.1) million, or ($0.25) per share during the same period last year. Net income for the third quarter of 2014 includes an incremental accrual of $12.1 million for the final settlement of the previously disclosed investigation in connection with the United States Foreign Corrupt Practices Act, which compares to an accrual of $20 million recorded in the same period last year. (On November 3, 2014, Bio-Rad announced the resolution of investigations by the U.S. Department of Justice and Securities and Exchange Commission). 

Year-to-date revenues were $1.58 billion, an increase of 3.1% compared to $1.53 billion reported in the first three quarters of 2013. Adjusting for the impact of currency, year-to-date revenue growth was 2.7%.

Year-to-date net income for the first three quarters of 2014 was $49.8 million, or $1.71 per share on a fully diluted basis, compared to $47.7 million, or $1.65 per share reported during the same period in 2013. The change in net income resulted primarily from the increase of sales, reduced interest expense, and a gain of $7.0 million reflecting the revaluation of contingent considerations for certain acquisitions. These results were somewhat offset by a higher effective tax rate. 

Cash flow was strong for the first nine months ended September 30, 2014, compared to the same period last year, as cash provided by operations was $233.1 million in 2014 versus $98.6 million last year. 

"We are encouraged with the third-quarter results, which reflect customer acceptance of many recently introduced products and buoyancy in some markets," said Norman Schwartz, Bio-Rad President and Chief Executive Officer.

Life Science
The Life Science segment net sales for the third quarter were $172.8 million, an increase of 6.1% compared to the same period last year. On a currency-neutral basis, the Life Science segment sales increased by 5.5% compared to the third quarter of 2013. Growth during the quarter was fueled by sales of the Company's Droplet Digital™ PCR, cell biology and protein separations products. Sales for the Life Science segment were particularly strong in Europe and North America. In September, the Company introduced ZOE™ Fluorescent Cell Imager, a digital imaging system that simplifies fluorescence imaging for cell culture applications.

Clinical Diagnostics
Reported net sales for the Clinical Diagnostics segment in the third quarter were $354.7 million, an increase of 4.7% compared to the third quarter in 2013. On a currency-neutral basis, the Clinical Diagnostics segment sales increased 3.9%. Results from the third quarter benefitted primarily from growth of immunohematology and autoimmune products. Sales for the Clinical Diagnostics segment reflected strength in Eastern Europe and Asia.

Management will discuss these results in a conference call at 2 PM Pacific Time (5 PM Eastern Time) November 4, 2014. Interested parties may access the call at 866-383-8009 (in the U.S.) or 617-597-5342 (international), passcode 64852364.

A live webcast of the conference call may be accessed in the Investor Relations area 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), passcode: 34114260, for seven days following the call. The webcast of the call will be archived on the Bio-Rad site for replay for up to a year and may be accessed in the Investor Relations area of www.bio-rad.com.

About Bio-Rad
Bio-Rad Laboratories, Inc. (NYSE: BIO) and (NYSE: BIO.B) develops, manufactures, and markets a broad range of innovative products and solutions for the life science research and clinical diagnostic markets. The company is renowned for its commitment to quality and customer service among university and research institutions, hospitals, public health and commercial laboratories, as well as the biotechnology, pharmaceutical, and food safety industries. Founded in 1952, Bio-Rad is based in Hercules, California, and serves more than 100,000 research and healthcare industry customers through its global network of operations. The company employs more than 7,800 people worldwide and had revenues exceeding $2.1 billion in 2013. For more information, visit our website at 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 Operations  
   
(in thousands, except per share data)  
(UNAUDITED)  
   
    Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
    2014     2013     2014     2013  
Net sales   $ 530,644     $ 505,066     $ 1,576,820     $ 1,530,059  
  Cost of goods sold     242,068       220,850       715,713       674,330  
Gross profit     288,576       284,216       861,107       855,729  
                                 
  Selling, general and administrative expense     202,550       202,238       600,663       583,486  
  Research and development expense     52,786       52,920       161,046       155,104  
Income from operations     33,240       29,058       99,398       117,139  
                                 
  Interest expense     7,710       31,611       17,131       54,252  
  Foreign currency exchange losses, net     3,667       3,330       6,118       5,723  
  Other (income) expense, net     (613 )     (667 )     (9,662 )     (10,711 )
Income (loss) before income taxes     22,476       (5,216 )     85,811       67,875  
                                 
  Provision for income taxes     (10,967 )     (1,883 )     (36,003 )     (20,200 )
Net income (loss) including noncontrolling interests     11,509       (7,099 )     49,808       47,675  
                                 
  Net income attributable to noncontrolling interests     -       -       -       (21 )
Net income (loss) attributable to Bio-Rad   $ 11,509     $ (7,099 )   $ 49,808     $ 47,654  
                                 
Basic earnings per share:                                
  Net income (loss) per basic share attributable to Bio-Rad   $ 0.40     $ (0.25 )   $ 1.73     $ 1.67  
                                 
  Weighted average common shares - basic     28,884       28,603       28,834       28,545  
                                 
Diluted earnings per share:                                
  Net income (loss) per diluted share attributable to Bio-Rad   $ 0.39     $ (0.25 )   $ 1.71     $ 1.65  
                                   
  Weighted average common shares - diluted     29,141       28,603       29,097       28,870  
                                   
                                   
 
 
Bio-Rad Laboratories, Inc.
Condensed Consolidated Balance Sheets
 
(In thousands)
 
    September 30,   December 31,
    2014   2013
    (UNAUDITED)    
Current assets:            
  Cash and cash equivalents   $ 424,593   $ 331,551
  Short-term investments     277,985     277,369
  Accounts receivable, net     354,401     422,660
  Inventories, net     516,047     516,245
  Other current assets     191,419     209,654
    Total current assets     1,764,445     1,757,479
             
Property, plant and equipment, net     420,897     414,401
Goodwill, net     513,454     517,770
Purchased intangibles, net     273,527     266,188
Other assets     413,701     432,952
    Total assets   $ 3,386,024   $ 3,388,790
             
             
Current liabilities:            
  Accounts payable   $ 126,640   $ 148,510
  Accrued payroll and employee benefits     148,283     130,658
  Notes payable and current maturities of long-term debt     1,471     1,786
  Income and other taxes payable     24,399     33,555
  Other current liabilities     202,990     172,963
    Total current liabilities     503,783     487,472
             
Long-term debt, net of current maturities     435,739     435,615
Other long-term liabilities     269,772     278,981
    Total liabilities     1,209,294     1,202,068
                 
    Total stockholders' equity     2,176,730     2,186,722
    Total liabilities and stockholders' equity   $ 3,386,024   $ 3,388,790
                 
                 
   
   
Bio-Rad Laboratories, Inc.  
Condensed Consolidated Statements of Cash Flows  
   
(In thousands)  
(UNAUDITED)  
   
    Nine Months Ended September 30,  
    2014     2013  
                 
Cash flows from operating activities:                
  Cash received from customers   $ 1,613,723     $ 1,531,251  
  Cash paid to suppliers and employees     (1,352,654 )     (1,335,844 )
  Interest paid     (10,757 )     (50,188 )
  Income tax payments     (31,105 )     (59,720 )
  Other operating activities     13,889       13,087  
  Net cash provided by operating activities     233,096       98,586  
                 
Cash flows from investing activities:                
  Payments for acquisitions and long-term investments     (43,645 )     (68,510 )
  Other investing activities     (97,422 )     108,874  
  Net cash (used in) provided by investing activities     (141,067 )     40,364  
                 
Cash flows from financing activities:                
  Payments on long-term borrowings     (181 )     (300,178 )
  Other financing activities     8,245       (15,287 )
  Net cash provided by (used in) financing activities     8,064       (315,465 )
                 
Effect of foreign exchange rate changes on cash     (7,051 )     4,920  
                 
Net increase (decrease) in cash and cash equivalents     93,042       (171,595 )
Cash and cash equivalents at beginning of period     331,551       463,388  
Cash and cash equivalents at end of period   $ 424,593     $ 291,793  
                 
                 
Reconciliation of net income including noncontrolling interests to net cash provided by operating activities:                
                 
Net income including noncontrolling interests   $ 49,808     $ 47,675  
Adjustments to reconcile net income including noncontrolling interests to net cash provided by operating activities:                
  Depreciation and amortization     110,129       105,181  
  Changes in working capital     61,772       (63,963 )
  Other     11,387       9,693  
Net cash provided by operating activities   $ 233,096     $ 98,586  
                 
                 

Contact Information

  • Investor and Financial Contacts:
    Bio-Rad Laboratories, Inc.
    Christine Tsingos, Executive Vice President and Chief Financial Officer
    Ron Hutton, Vice President, Treasurer
    510-724-7000
    Email Contact