☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Michigan | 38-2367843 | |
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification Number) |
Symbol(s) | ||||
Title of each Class | Trading Symbol(s) | Name of each exchange on which registered | ||
Common Stock, $0.16 par value per share | NEOG | NASDAQ Global Select Market |
Large accelerated filer | ☒ | Accelerated filer | ☐ | |||
Non-accelerated filer | ☐ | Smaller | ☐ | |||
Emerging growth company | ☐ |
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3 | ||||||||||
4 | ||||||||||
5 | ||||||||||
6 | ||||||||||
7 | ||||||||||
Item 2. | ||||||||||
Item 3. | ||||||||||
27 | ||||||||||
Item 4. | 27 | |||||||||
Item 1. | 28 | |||||||||
Item 6. | 28 | |||||||||
29 | ||||||||||
CEO Certification | ||||||||||
CFO Certification | ||||||||||
Section 906 Certification |
August 31, | May 31, | |||||||
2020 | 2020 | |||||||
Assets | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 60,947 | $ | 66,269 | ||||
Marketable securities | 306,539 | 277,404 | ||||||
Accounts receivable, less allowance of $1,350 and $1,350 at August 31, 2020 and | ||||||||
May 31, 2020, respectively | 77,685 | 84,681 | ||||||
Inventories | 97,573 | 95,053 | ||||||
Prepaid expenses and other current assets | 13,955 | 13,999 | ||||||
Total Current Assets | 556,699 | 537,406 | ||||||
Net Property and Equipment | 80,593 | 78,671 | ||||||
Other Assets | ||||||||
Right of use assets | 1,756 | 1,952 | ||||||
Goodwill | 111,675 | 110,340 | ||||||
Other non-amortizable intangible assets | 15,366 | 15,217 | ||||||
Amortizable intangible and other assets, net of accumulated amortization of $46,773 and $44,690 at August 31, 2020 and May 31, 2020, respectively | 55,503 | 53,596 | ||||||
Total Assets | $ | 821,592 | $ | 797,182 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current Liabilities | ||||||||
Accounts payable | $ | 22,537 | $ | 25,650 | ||||
Accrued compensation | 5,501 | 7,735 | ||||||
Income taxes | 4,597 | 1,456 | ||||||
Other accruals | 13,807 | 13,648 | ||||||
Total Current Liabilities | 46,442 | 48,489 | ||||||
Deferred Income Taxes | 18,306 | 18,125 | ||||||
Other Non-Current Liabilities | 5,298 | 5,391 | ||||||
Total Liabilities | 70,046 | 72,005 | ||||||
Commitments and Contingencies (note 8) | ||||||||
Equity | ||||||||
Preferred stock, $1.00 par value, 100,000 shares authorized, 0ne issued and outstanding | 0 | 0 | ||||||
Common stock, $0.16 par value, 120,000,000 shares authorized, 53,041,102 and 52,945,841 shares issued and outstanding at August 31, 2020 and May 31, 2020, respectively | 8,487 | 8,471 | ||||||
Additional paid-in capital | 264,184 | 257,693 | ||||||
Accumulated other comprehensive loss | (15,707 | ) | (19,709 | ) | ||||
Retained earnings | 494,582 | 478,722 | ||||||
Total Stockholders’ Equity | 751,546 | 725,177 | ||||||
Total Liabilities and Stockholders’ Equity | $ | 821,592 | $ | 797,182 | ||||
November 30, | May 31, | |||||||
2020 | 2020 | |||||||
Assets | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 113,867 | $ | 66,269 | ||||
Marketable securities | 276,898 | 277,404 | ||||||
Accounts receivable, less allowance of $1,350 and $1,350 at November 30, 2020 and May 31, 2020, respectively | 79,931 | 84,681 | ||||||
Inventories | 92,529 | 95,053 | ||||||
Prepaid expenses and other current assets | 15,201 | 13,999 | ||||||
Total Current Assets | 578,426 | 537,406 | ||||||
Net Property and Equipment | 83,774 | 78,671 | ||||||
Other assets | ||||||||
Right of use assets | 1,540 | 1,952 | ||||||
Goodwill | 111,687 | 110,340 | ||||||
Other non-amortizable intangible assets | 15,378 | 15,217 | ||||||
Amortizable intangible and other assets, net of accumulated amortization of $48,546 and $44,690 at November 30, 2020 and May 31, 2020, respectively | 54,821 | 53,596 | ||||||
Total Assets | $ | 845,626 | $ | 797,182 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current Liabilities | ||||||||
Accounts payable | $ | 20,697 | $ | 25,650 | ||||
Accrued compensation | 8,321 | 7,735 | ||||||
Income taxes | 476 | 1,456 | ||||||
Other accruals | 15,093 | 13,648 | ||||||
Total Current Liabilities | 44,587 | 48,489 | ||||||
Deferred Income Taxes | 18,391 | 18,125 | ||||||
Other Non-Current Liabilities | 5,253 | 5,391 | ||||||
Total Liabilities | 68,231 | 72,005 | ||||||
Commitments and Contingencies (note 11) | 0 | 0 | ||||||
Equity | ||||||||
Preferred stock, $1.00 par value, 100,000 shares authorized, 0ne issued and outstanding | 0 | 0 | ||||||
Common stock, $0.16 par value, 120,000,000 shares authorized, 53,244,057 and 52,945,841 shares issued and outstanding at November 30, 2020 and May 31, 2020, respectively | 8,519 | 8,471 | ||||||
Additional paid-in capital | 273,495 | 257,693 | ||||||
Accumulated other comprehensive loss | (15,086 | ) | (19,709 | ) | ||||
Retained earnings | 510,467 | 478,722 | ||||||
Total Stockholders’ Equity | 777,395 | 725,177 | ||||||
Total Liabilities and Stockholders’ Equity | $ | 845,626 | $ | 797,182 | ||||
Three Months Ended August 31, | ||||||||
2020 | 2019 | |||||||
Revenues | ||||||||
Product revenues | $ | 87,935 | $ | 81,948 | ||||
Service revenues | 21,390 | 19,476 | ||||||
Total Revenues | 109,325 | 101,424 | ||||||
Cost of Revenues | ||||||||
Cost of product revenues | 46,595 | 42,031 | ||||||
Cost of service revenues | 12,428 | 11,199 | ||||||
Total Cost of Revenues | 59,023 | 53,230 | ||||||
Gross Margin | 50,302 | 48,194 | ||||||
Operating Expenses | ||||||||
Sales and marketing | 16,516 | 17,543 | ||||||
General and administrative | 11,013 | 10,699 | ||||||
Research and development | 3,878 | 3,688 | ||||||
Total Operating Expenses | 31,407 | 31,930 | ||||||
Operating Income | 18,895 | 16,264 | ||||||
Other Income (Expense) | ||||||||
Interest income | 722 | 1,510 | ||||||
Other expense | 193 | (122 | ) | |||||
Total Other Income | 915 | 1,388 | ||||||
Income Before Taxes | 19,810 | 17,652 | ||||||
Provision for Income Taxes | 3,950 | 3,000 | ||||||
Net Income | $ | 15,860 | $ | 14,652 | ||||
Net Income Per Share | ||||||||
Basic | $ | 0.30 | $ | 0.28 | ||||
Diluted | $ | 0.30 | $ | 0.28 | ||||
Weighted Average Shares Outstanding | ||||||||
Basic | 52,992 | 52,292 | ||||||
Diluted | 53,285 | 52,684 |
Three Months Ended | Six Months Ended | |||||||||||||||
November 30, | November 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Revenues | ||||||||||||||||
Product revenues | $ | 92,537 | $ | 87,387 | $ | 180,472 | $ | 169,335 | ||||||||
Service revenues | 22,463 | 20,416 | 43,853 | 39,892 | ||||||||||||
Total Revenues | 115,000 | 107,803 | 224,325 | 209,227 | ||||||||||||
Cost of Revenues | ||||||||||||||||
Cost of product revenues | 49,275 | 45,559 | 95,870 | 87,590 | ||||||||||||
Cost of service revenues | 12,511 | 11,218 | 24,939 | 22,417 | ||||||||||||
Total Cost of Revenues | 61,786 | 56,777 | 120,809 | 110,007 | ||||||||||||
Gross Margin | 53,214 | 51,026 | 103,516 | 99,220 | ||||||||||||
Operating Expenses | ||||||||||||||||
Sales and marketing | 17,729 | 17,988 | 34,245 | 35,531 | ||||||||||||
General and administrative | 12,184 | 10,985 | 23,197 | 21,684 | ||||||||||||
Research and development | 4,056 | 3,781 | 7,934 | 7,469 | ||||||||||||
Total Operating Expenses | 33,969 | 32,754 | 65,376 | 64,684 | ||||||||||||
Operating Income | 19,245 | 18,272 | 38,140 | 34,536 | ||||||||||||
Other Income (Expense) | ||||||||||||||||
Interest income | 555 | 1,271 | 1,277 | 2,781 | ||||||||||||
Other expense | (465 | ) | (317 | ) | (272 | ) | (439 | ) | ||||||||
Total Other Income | 90 | 954 | 1,005 | 2,342 | ||||||||||||
Income Before Taxes | 19,335 | 19,226 | 39,145 | 36,878 | ||||||||||||
Provision for Income Taxes | 3,450 | 2,950 | 7,400 | 5,950 | ||||||||||||
Net Income | $ | 15,885 | $ | 16,276 | $ | 31,745 | $ | 30,928 | ||||||||
Net Income Per Share | ||||||||||||||||
Basic | $ | 0.30 | $ | 0.31 | $ | 0.60 | $ | 0.59 | ||||||||
Diluted | $ | 0.30 | $ | 0.31 | $ | 0.60 | $ | 0.59 | ||||||||
Weighted Average Shares Outstanding | ||||||||||||||||
Basic | 53,129 | 52,557 | 53,022 | 52,355 | ||||||||||||
Diluted | 53,404 | 52,876 | 53,300 | 52,712 |
Three Months Ended August 31, | ||||||||
2020 | 2019 | |||||||
Net income | $ | 15,860 | $ | 14,652 | ||||
Other comprehensive income (loss), net of tax: foreign currency translations | 4,121 | (3,058 | ) | |||||
Other comprehensive income (loss), net of tax: unrealized gain (loss) on marketable securities | (119 | ) | 562 | |||||
Total comprehensive income | $ | 19,862 | $ | 12,156 |
Three Months Ended | Six Months Ended | |||||||||||||||
November 30, | November 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Net income | $ | 15,885 | $ | 16,276 | $ | 31,745 | $ | 30,928 | ||||||||
Other comprehensive income (loss), net of tax: foreign currency translations | 938 | 2,367 | 5,059 | (691 | ) | |||||||||||
Other comprehensive income (loss), net of tax: unrealized gain (loss) on marketable securities | (317 | ) | (149 | ) | (436 | ) | 413 | |||||||||
Total comprehensive income | $ | 16,506 | $ | 18,494 | $ | 36,368 | $ | 30,650 | ||||||||
Accumulated | ||||||||||||||||||||||||||||||||||||||||||||||||
Additional Paid-in Capital | Accumulated Other Comprehensive (Loss) | Retained Earnings | Additional | Other | ||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Common Stock | Paid-in | Comprehensive | Retained | ||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Total | Shares | Amount | Capital | Income (Loss) | Earnings | Total | ||||||||||||||||||||||||||||||||||||||||
Balance, June 1, 2020 | 52,946 | $ | 8,471 | $ | 257,693 | $ | (19,709 | ) | $ | 478,722 | $ | 725,177 | 52,946 | $ | 8,471 | $ | 257,693 | $ | (19,709 | ) | $ | 478,722 | $ | 725,177 | ||||||||||||||||||||||||
Exercise of options and share-based compensation expense | 86 | 14 | 5,825 | — | — | 5,839 | 86 | 14 | 5,825 | — | — | 5,839 | ||||||||||||||||||||||||||||||||||||
Issuance of shares under employee stock purchase plan | 9 | 2 | 666 | — | — | 668 | 9 | 2 | 666 | — | — | 668 | ||||||||||||||||||||||||||||||||||||
Net income for the three months ended August 31, 2020 | — | — | — | — | 15,860 | 15,860 | — | — | — | — | 15,860 | 15,860 | ||||||||||||||||||||||||||||||||||||
Other comprehensive income for the three months ended August 31, 2020 | — | — | — | 4,002 | — | 4,002 | — | — | — | 4,002 | — | 4,002 | ||||||||||||||||||||||||||||||||||||
Balance, August 31, 2020 | 53,041 | $ | 8,487 | $ | 264,184 | $ | (15,707 | ) | $ | 494,582 | $ | 751,546 | 53,041 | $ | 8,487 | $ | 264,184 | $ | (15,707 | ) | $ | 494,582 | $ | 751,546 | ||||||||||||||||||||||||
Exercise of options and share-based compensation expense | 203 | 32 | 9,311 | — | — | 9,343 | ||||||||||||||||||||||||||||||||||||||||||
Net income for the three months ended November 30, 2020 | — | — | — | — | 15,885 | 15,885 | ||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income for the three months ended November 30, 2020 | — | — | — | 621 | — | 621 | ||||||||||||||||||||||||||||||||||||||||||
Balance, November 30, 2020 | 53,244 | 8,519 | 273,495 | $ | (15,086 | ) | $ | 510,467 | $ | 777,395 | ||||||||||||||||||||||||||||||||||||||
Balance, June 1, 2019 | 52,217 | $ | 8,355 | $ | 221,937 | $ | (11,640 | ) | $ | 419,247 | $ | 637,899 | ||||||||||||||||||||||||||||||||||||
Exercise of options and share-based compensation plan | 196 | 30 | 9,683 | — | — | 9,713 | ||||||||||||||||||||||||||||||||||||||||||
Issuance of shares under employee stock purchase plan | 10 | 2 | 536 | — | — | 538 | ||||||||||||||||||||||||||||||||||||||||||
Net income for the three months ended August 31, 2019 | — | — | — | — | 14,652 | 14,652 | ||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss for the three months ended August 31, 2019 | — | — | — | (2,496 | ) | — | (2,496 | ) | ||||||||||||||||||||||||||||||||||||||||
Balance, August 31, 2019 | 52,423 | $ | 8,387 | $ | 232,156 | $ | (14,136 | ) | $ | 433,899 | $ | 660,306 | ||||||||||||||||||||||||||||||||||||
Exercise of options and share-based compensation plan | 288 | 47 | 12,070 | — | — | 12,117 | ||||||||||||||||||||||||||||||||||||||||||
Net income for the three months ended November 30, 2019 | — | — | — | — | 16,276 | 16,276 | ||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income for the three months ended November 30, 2019 | — | — | — | 2,218 | — | 2,218 | ||||||||||||||||||||||||||||||||||||||||||
Balance, November 30, 2019 | 52,711 | 8,434 | 244,226 | (11,918 | ) | 450,175 | 690,917 | |||||||||||||||||||||||||||||||||||||||||
Additional Paid-in Capital | Accumulated Other Comprehensive (Loss) | |||||||||||||||||||||||
Common Stock | Retained Earnings | |||||||||||||||||||||||
Shares | Amount | Total | ||||||||||||||||||||||
Balance, June 1, 2019 | 52,217 | $ | 8,355 | $ | 221,937 | $ | (11,640 | ) | $ | 419,247 | $ | 637,899 | ||||||||||||
Exercise of options and share-based compensation expense | 196 | 30 | 9,683 | — | — | 9,713 | ||||||||||||||||||
Issuance of shares under employee stock purchase plan | 10 | 2 | 536 | — | — | 538 | ||||||||||||||||||
Net income for the three months ended August 31, 2019 | — | — | — | — | 14,652 | 14,652 | ||||||||||||||||||
Other comprehensive loss for the three months ended August 31, 2019 | — | — | — | (2,496 | ) | — | (2,496 | ) | ||||||||||||||||
Balance, August 31, 2019 | 52,423 | $ | 8,387 | $ | 232,156 | $ | (14,136 | ) | $ | 433,899 | $ | 660,306 |
Three Months Ended August 31, | ||||||||
2020 | 2019 | |||||||
Cash Flows From Operating Activities | ||||||||
Net Income | $ | 15,860 | $ | 14,652 | ||||
Adjustments to reconcile net income to net cash from operating activities: | ||||||||
Depreciation and amortization | 4,720 | 4,435 | ||||||
Share-based compensation | 1,681 | 1,543 | ||||||
Change in operating assets and liabilities, net of business acquisitions: | ||||||||
Accounts receivable | 8,350 | 3,390 | ||||||
Inventories | (1,319 | ) | (2,132 | ) | ||||
Prepaid expenses and other current assets | (1,045 | ) | (1,929 | ) | ||||
Accounts payable, accruals and other changes | (3,113 | ) | 3,760 | |||||
Net Cash From Operating Activities | 25,134 | 23,719 | ||||||
Cash Flows For Investing Activities | ||||||||
Purchases of property, equipment and other non-current intangible assets | (4,248 | ) | (6,469 | ) | ||||
Proceeds from the sale of marketable securities | 139,184 | 94,540 | ||||||
Purchases of marketable securities | (168,318 | ) | (103,432 | ) | ||||
Business acquisitions, net of cash acquired | (2,350 | ) | — | |||||
Net Cash For Investing Activities | (35,732 | ) | (15,361 | ) | ||||
Cash Flows From Financing Activities | ||||||||
Exercise of stock options and issuance of employee stock purchase plan shares | 5,095 | 8,708 | ||||||
Net Cash From Financing Activities | 5,095 | 8,708 | ||||||
Effect of Foreign Exchange Rates on Cash | 181 | (2,465 | ) | |||||
Net Increase (Decrease) In Cash and Cash Equivalents | (5,322 | ) | 14,601 | |||||
Cash and Cash Equivalents, Beginning of Period | 66,269 | 41,688 | ||||||
Cash and Cash Equivalents, End of Period | $ | 60,947 | $ | 56,289 | ||||
Six Months Ended | ||||||||
November 30, | ||||||||
2020 | 2019 | |||||||
Cash Flows From Operating Activities | ||||||||
Net Income | $ | 31,745 | $ | 30,928 | ||||
Adjustments to reconcile net income to net cash from operating activities: | ||||||||
Depreciation and amortization | 9,523 | 8,985 | ||||||
Share-based compensation | 3,192 | 3,155 | ||||||
Change in operating assets and liabilities, net of business acquisitions: | ||||||||
Accounts receivable | 6,662 | (2,483 | ) | |||||
Inventories | 4,063 | (103 | ) | |||||
Prepaid expenses and other current assets | (2,080 | ) | (1,323 | ) | ||||
Accounts payable, accruals and other changes | (5,581 | ) | 1,313 | |||||
Net Cash From Operating Activities | 47,524 | 40,472 | ||||||
Cash Flows For Investing Activities | ||||||||
Purchases of property, equipment and other non-current intangible assets | (11,092 | ) | (12,806 | ) | ||||
Proceeds from the sale of marketable securities | 309,030 | 199,708 | ||||||
Purchases of marketable securities | (308,524 | ) | (220,528 | ) | ||||
Business acquisitions, net of cash acquired | (2,350 | ) | — | |||||
Net Cash For Investing Activities | (12,936 | ) | (33,626 | ) | ||||
Cash Flows From Financing Activities | ||||||||
Exercise of stock options and issuance of employee stock purchase plan shares | 12,658 | 19,213 | ||||||
Net Cash From Financing Activities | 12,658 | 19,213 | ||||||
Effect of Foreign Exchange Rates on Cash | 352 | (1,333 | ) | |||||
Net Increase In Cash and Cash Equivalents | 47,598 | 24,726 | ||||||
Cash and Cash Equivalents, Beginning of Period | 66,269 | 41,688 | ||||||
Cash and Cash Equivalents, End of Period | $ | 113,867 | $ | 66,414 | ||||
(in thousands) | Maturity | August 31, 2020 | May 31, 2020 | |||||||
US Treasuries | 0—90 days | $ | 0 | $ | 0 | |||||
91—180 days | 2,516 | 0 | ||||||||
181 days—1 year | 0 | 2,532 | ||||||||
1—2 years | 0 | 0 | ||||||||
Commercial Paper & Corporate Bonds | 0—90 days | 120,055 | 133,130 | |||||||
91—180 days | 93,239 | 73,824 | ||||||||
181 days—1 year | 63,668 | 43,231 | ||||||||
1—2 years | 10,012 | 7,839 | ||||||||
Certificates of Deposit | 0—90 days | 4,908 | 1,003 | |||||||
91—180 days | 1,257 | 5,184 | ||||||||
181 days—1 year | 8,338 | 6,069 | ||||||||
1—2 years | 2,546 | 4,592 | ||||||||
Total Marketable Securities | $ | 306,539 | $ | 277,404 | ||||||
November 30, | May 31, | |||||||||||
(in thousands) | Maturity | 2020 | 2020 | |||||||||
US Treasuries | 0 - 90 days | $ | 0 | $ | 0 | |||||||
91 - 180 days | 0 | 0 | ||||||||||
181 days - 1 year | 0 | 2,532 | ||||||||||
1 - 2 years | 0 | 0 | ||||||||||
Commercial Paper & Corporate Bonds | 0 - 90 days | 114,237 | 133,130 | |||||||||
91 - 180 days | 132,758 | 73,824 | ||||||||||
181 days - 1 year | 15,978 | 43,231 | ||||||||||
1 - 2 years | 1,830 | 7,839 | ||||||||||
Certificates of Deposit | 0 - 90 days | 4,012 | 1,003 | |||||||||
91 - 180 days | 2,260 | 5,184 | ||||||||||
181 days - 1 year | 4,553 | 6,069 | ||||||||||
1 - 2 years | 1,270 | 4,592 | ||||||||||
Total Marketable Securities | $ | 276,898 | $ | 277,404 | ||||||||
(in thousands) | Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | ||||||||||||
US Treasuries | $ | 2,502 | $ | 14 | $ | — | $ | 2,516 | ||||||||
Commercial Paper & Corporate Bonds | 286,211 | 820 | (57 | ) | 286,974 | |||||||||||
Certificates of Deposit | 16,911 | 138 | — | 17,049 | ||||||||||||
Total Marketable Securities | $ | 305,624 | $ | 972 | $ | (57 | ) | $ | 306,539 | |||||||
Amortized | Unrealized | Unrealized | ||||||||||||||
(in thousands) | Cost | Gains | Losses | Fair Value | ||||||||||||
US Treasuries | $ | — | $ | — | $ | — | $ | — | ||||||||
Commercial Paper & Corporate Bonds | 264,616 | 338 | (151 | ) | 264,803 | |||||||||||
Certificates of Deposit | 12,009 | 86 | — | 12,095 | ||||||||||||
Total Marketable Securities | $ | 276,625 | $ | 424 | $ | (151 | ) | $ | 276,898 | |||||||
(in thousands) | Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | ||||||||||||
US Treasuries | $ | 2,502 | $ | 30 | $ | — | $ | 2,532 | ||||||||
Commercial Paper & Corporate Bonds | 257,700 | 347 | (23 | ) | 258,024 | |||||||||||
Certificates of Deposit | 16,648 | 200 | — | 16,848 | ||||||||||||
Total Marketable Securities | $ | 276,850 | $ | 577 | $ | (23 | ) | $ | 277,404 | |||||||
Amortized | Unrealized | Unrealized | ||||||||||||||
(in thousands) | Cost | Gains | Losses | Fair Value | ||||||||||||
US Treasuries | $ | 2,502 | $ | 30 | $ | — | $ | 2,532 | ||||||||
Commercial Paper & Corporate Bonds | 257,700 | 347 | (23 | ) | 258,024 | |||||||||||
Certificates of Deposit | 16,648 | 200 | — | 16,848 | ||||||||||||
Total Marketable Securities | $ | 276,850 | $ | 577 | $ | (23 | ) | $ | 277,404 | |||||||
(in thousands) | August 31, 2020 | May 31, 2020 | ||||||
Raw materials | $ | 47,589 | $ | 45,058 | ||||
Work-in-process | 6,323 | 6,887 | ||||||
Finished and purchased goods | 43,661 | 43,108 | ||||||
$97,573 | $95,053 | |||||||
November 30, | May 31, | |||||||
(in thousands) | 2020 | 2020 | ||||||
Raw materials | $ | 45,269 | $ | 45,058 | ||||
Work-in-process | 6,020 | 6,887 | ||||||
Finished and purchased goods | 41,240 | 43,108 | ||||||
$ | 92,529 | $ | 95,053 | |||||
For all asset classes, we elected to not recognize a right-of-use For all asset classes, we elected to not separate non-lease components from lease components to which they relate and have accounted for the combined lease andnon-lease components as a single lease component. |
The determination of the discount rate used in a lease is our incremental borrowing rate that is based on what we would normally pay to borrow on a collateralized basis over a similar term an amount equal to the lease payments. |
November 30, | May 31, | |||||||
(in thousands) | 2020 | 2020 | ||||||
Right of use - assets | $ | 1,540 | $ | 1,952 | ||||
Lease liabilities - current | 444 | 1,054 | ||||||
Lease liabilities - non-current | 1,062 | 913 |
(in thousands) | August 31, 2020 | May 31, 2020 | ||||||
Right of use—assets | $ | 1,756 | $ | 1,952 | ||||
Lease liabilities—current | 803 | 1,054 | ||||||
Lease liabilities—non-current | 966 | 913 |
(in thousands) | August 31, 2020 | May 31, 2020 | ||||||
Weighted average remaining lease term | 2.4 years | 2.5 years | ||||||
Weighted average discount rate | 3.2 | % | 3.2 | % |
November 30, 2020 | May 31, 2020 | |||||||
Weighted average remaining lease term | 2.4 years | 2.5 years | ||||||
Weighted average discount rate | 3.1 | % | 3.2 | % |
August 31, | ||||||||
(in thousands) | 2020 | 2019 | ||||||
Operating leases | $ | 205 | $ | 240 | ||||
Short term leases | 44 | 48 | ||||||
Total lease expense | $ | 249 | $ | 288 | ||||
Three Months Ended November 30, | Six Months Ended November 30, | |||||||||||||||
(in thousands) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Operating leases | $ | 440 | $ | 333 | $ | 645 | $ | 573 | ||||||||
Short term leases | 16 | 34 | 60 | 81 | ||||||||||||
Total lease expense | $ | 456 | $ | 367 | $ | 705 | $ | 654 | ||||||||
Years ending May 31, | Amount | |||
2021 (1) | $ | 789 | ||
2022 | 553 | |||
2023 | 292 | |||
2024 | 145 | |||
2025 | 43 | |||
2026 and thereafter | 0 | |||
Total lease payments | 1,822 | |||
Less: imputed interest | (97 | ) | ||
Total lease liabilities | $ | 1,725 | ||
Amount | ||||
Years ending May 31, 2021 (1) | $ | 444 | ||
2022 | 613 | |||
2023 | 338 | |||
2024 | 169 | |||
2025 | 44 | |||
2026 and thereafter | 0 | |||
Total lease payments | 1,608 | |||
Less: imputed interest | 101 | |||
Total lease liabilities | $ | 1,507 | ||
(1) | Excluding the |
Rodenticides, disinfectants and insecticides to assist in the control of rodents, insects and disease in and around agricultural, food production and other facilities. |
Other commercial laboratory services. |
Three Months ended November 30, | Six Months ended November 30, | |||||||||||||||
(in thousands) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Food Safety | ||||||||||||||||
Natural Toxins, Allergens & Drug Residues | $ | 20,001 | $ | 20,681 | $ | 39,016 | $ | 40,796 | ||||||||
Bacterial & General Sanitation | 11,235 | 11,615 | 21,166 | 21,931 | ||||||||||||
Culture Media & Other | 13,296 | 12,757 | 24,689 | 24,037 | ||||||||||||
Rodenticides, Insecticides & Disinfectants | 7,978 | 7,447 | 17,586 | 12,896 | ||||||||||||
Genomics Services | 5,024 | 4,354 | 9,262 | 8,216 | ||||||||||||
$ | 57,534 | $ | 56,854 | $ | 111,719 | $ | 107,876 | |||||||||
Animal Safety | ||||||||||||||||
Life Sciences | $ | 1,398 | $ | 1,803 | $ | 2,723 | $ | 3,525 | ||||||||
Veterinary Instruments & Disposables | 11,974 | 10,486 | 22,349 | 21,822 | ||||||||||||
Animal Care & Other | 9,371 | 7,787 | 17,029 | 14,193 | ||||||||||||
Rodenticides, Insecticides & Disinfectants | 18,471 | 16,186 | 38,385 | 32,904 | ||||||||||||
Genomics Services | 16,252 | 14,687 | 32,120 | 28,907 | ||||||||||||
$ | 57,466 | $ | 50,949 | $ | 112,606 | $ | 101,351 | |||||||||
Total Revenues | $ | 115,000 | $ | 107,803 | $ | 224,325 | $ | 209,227 | ||||||||
Three Months ended August 31, | ||||||||
(in thousands) | 2020 | 2019 | ||||||
Food Safety | ||||||||
Natural Toxins, Allergens & Drug Residues | $ | 19,015 | $ | 20,115 | ||||
Bacterial & General Sanitation | 9,931 | 10,316 | ||||||
Culture Media & Other | 11,393 | 11,279 | ||||||
Rodenticides, Insecticides & Disinfectants | 9,608 | 5,449 | ||||||
Genomics Services | 4,238 | 3,862 | ||||||
$ | 54,185 | $ | 51,021 | |||||
Animal Safety | ||||||||
Life Sciences | $ | 1,325 | $ | 1,723 | ||||
Veterinary Instruments & Disposables | 10,375 | 11,336 | ||||||
Animal Care & Other | 7,658 | 6,405 | ||||||
Rodenticides, Insecticides & Disinfectants | 19,914 | 16,718 | ||||||
Genomics Services | 15,868 | 14,221 | ||||||
$ | 55,140 | $ | 50,403 | |||||
Total Revenues | $ | 109,325 | $ | 101,424 | ||||
Three Months Ended | ||||||||
August 31, | ||||||||
(in thousands, except | 2020 | 2019 | ||||||
Numerator for basic and diluted net income per share: | ||||||||
Net income attributable to Neogen | $ | 15,860 | $ | 14,652 | ||||
Denominator for basic net income per share: | ||||||||
Weighted average shares | 52,992 | 52,292 | ||||||
Effect of dilutive stock options | 293 | 392 | ||||||
Denominator for diluted net income per share | 53,285 | 52,684 | ||||||
Net income attributable to Neogen per share: | ||||||||
Basic | $ | 0.30 | $ | 0.28 | ||||
Diluted | $ | 0.30 | $ | 0.28 | ||||
Three Months Ended November 30, | Six Months Ended November 30, | |||||||||||||||
(in thousands, except per share amounts) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Numerator for basic and diluted net income per share: | ||||||||||||||||
Net income attributable to Neogen | $ | 15,885 | $ | 16,276 | $ | 31,745 | $ | 30,928 | ||||||||
Denominator for basic net income per share: | ||||||||||||||||
Weighted average shares | 53,129 | 52,557 | 53,022 | 52,355 | ||||||||||||
Effect of dilutive stock options and RSUs | 275 | 319 | 278 | 357 | ||||||||||||
Denominator for diluted net income per share | 53,404 | 52,876 | 53,300 | 52,712 | ||||||||||||
Net income attributable to Neogen per share: | ||||||||||||||||
Basic | $ | 0.30 | $ | 0.31 | $ | 0.60 | $ | 0.59 | ||||||||
Diluted | $ | 0.30 | $ | 0.31 | $ | 0.60 | $ | 0.59 | ||||||||
Corporate and | ||||||||||||||||
Food | Animal | Eliminations | ||||||||||||||
(in thousands) | Safety | Safety | (1) | Total | ||||||||||||
As of and for the three months ended August 31, 2020 | ||||||||||||||||
Product revenues to external customers | $ | 48,663 | $ | 39,272 | $ | — | $ | 87,935 | ||||||||
Service revenues to external customers | 5,522 | 15,868 | — | 21,390 | ||||||||||||
Total revenues to external customers | 54,185 | 55,140 | — | 109,325 | ||||||||||||
Operating income (loss) | 7,963 | 12,165 | (1,233 | ) | 18,895 | |||||||||||
Total assets | 225,716 | 228,390 | 367,486 | 821,592 | ||||||||||||
As of and for the three months ended August 31, 2019 | ||||||||||||||||
Product revenues to external customers | $ | 45,877 | $ | 36,071 | $ | — | $ | 81,948 | ||||||||
Service revenues to external customers | 5,144 | 14,332 | — | 19,476 | ||||||||||||
Total revenues to external customers | 51,021 | 50,403 | — | 101,424 | ||||||||||||
Operating income (loss) | 9,134 | 8,300 | (1,170 | ) | 16,264 | |||||||||||
Total assets | 207,725 | 222,403 | 291,016 | 721,144 |
Corporate and | ||||||||||||||||
Food | Animal | Eliminations | ||||||||||||||
(in thousands) | Safety | Safety | (1) | Total | ||||||||||||
As of and for the three months ended November 30, 2020 | ||||||||||||||||
Product revenues to external customers | $ | 51,323 | $ | 41,214 | $ | — | $ | 92,537 | ||||||||
Service revenues to external customers | 6,211 | 16,252 | — | 22,463 | ||||||||||||
Total revenues to external customers | 57,534 | 57,466 | — | 115,000 | ||||||||||||
Operating income (loss) | 8,960 | 12,246 | (1,961 | ) | 19,245 | |||||||||||
Total assets | 226,735 | 228,126 | 390,765 | 845,626 | ||||||||||||
As of and for the three months ended November 30, 2019 | ||||||||||||||||
Product revenues to external customers | $ | 51,188 | $ | 36,199 | $ | — | $ | 87,387 | ||||||||
Service revenues to external customers | 5,666 | 14,750 | — | 20,416 | ||||||||||||
Total revenues to external customers | 56,854 | 50,949 | — | 107,803 | ||||||||||||
Operating income (loss) | 9,556 | 9,729 | (1,013 | ) | 18,272 | |||||||||||
Total assets | 212,928 | 224,058 | 313,605 | 750,591 |
(1) | Includes corporate assets, consisting principally of cash and cash equivalents, marketable securities, current and deferred tax accounts and overhead expenses not allocated to specific business segments. Also includes the elimination of intersegment transactions. |
Corporate and | ||||||||||||||||
Food | Animal | Eliminations | ||||||||||||||
(in thousands) | Safety | Safety | (1) | Total | ||||||||||||
As of and for the six months ended November 30, 2020 | ||||||||||||||||
Product revenues to external customers | $ | 99,986 | $ | 80,486 | $ | — | $ | 180,472 | ||||||||
Service revenues to external customers | 11,733 | 32,120 | — | 43,853 | ||||||||||||
Total revenues to external customers | 111,719 | 112,606 | — | 224,325 | ||||||||||||
Operating income (loss) | 16,923 | 24,411 | (3,194 | ) | 38,140 | |||||||||||
As of and for the six months ended November 30, 2019 | ||||||||||||||||
Product revenues to external customers | $ | 97,065 | $ | 72,270 | $ | — | $ | 169,335 | ||||||||
Service revenues to external customers | 10,811 | 29,081 | — | 39,892 | ||||||||||||
Total revenues to external customers | 107,876 | 101,351 | — | 209,227 | ||||||||||||
Operating income (loss) | 18,690 | 18,029 | (2,183 | ) | 34,536 |
(1) | Includes elimination of intersegment transactions. |
Three months ended August 31, | ||||||||
(in thousands) | 2020 | 2019 | ||||||
Domestic | $ | 67,324 | $ | 63,340 | ||||
International | 42,001 | 38,084 | ||||||
Total revenue | 109,325 | 101,424 | ||||||
Three months ended | Six months ended | |||||||||||||||
November 30, | November 30, | |||||||||||||||
(in thousands) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Domestic | $ | 69,832 | $ | 63,317 | $ | 137,156 | $ | 126,657 | ||||||||
International | 45,168 | 44,486 | 87,169 | 82,570 | ||||||||||||
Total revenue | 115,000 | 107,803 | 224,325 | 209,227 | ||||||||||||
Weighted- | ||||||||
Average | ||||||||
(Options in thousands) | Shares | Exercise Price | ||||||
Options outstanding June 1, 2020 | 2,162 | $ | 55.96 | |||||
Granted | 0 | 0 | ||||||
Exercised | (86 | ) | 48.39 | |||||
Forfeited | (7 | ) | 57.81 | |||||
Options outstanding August 31, 2020 | 2,069 | $ | 56.27 |
Weighted- | ||||||||
Average | ||||||||
(Options in thousands) | Shares | Exercise Price | ||||||
Options outstanding June 1, 2020 | 2,162 | $ | 55.96 | |||||
Granted | 202 | 68.47 | ||||||
Exercised | (294 | ) | 42.04 | |||||
Forfeited | (160 | ) | 57.26 | |||||
Options outstanding November 30, 2020 | 1,910 | $ | 59.29 |
FY | ||||
Risk-free interest rate | ||||
Expected dividend yield | ||||
Expected stock price volatility | ||||
Expected option life |
Revenue % Inc (Dec) USD | Revenue % Inc (Dec) Local Currency | Three Months Ended | Six Months Ended | |||||||||||||
U.K. Operations | 21 | % | 17 | % | ||||||||||||
November 30, 2020 | November 30, 2020 | |||||||||||||||
Revenue | Revenue | Revenue | Revenue | |||||||||||||
% Inc (Dec) | % Inc (Dec) | % Inc (Dec) | % Inc (Dec) | |||||||||||||
USD | Local Currency | USD | Local Currency | |||||||||||||
U.K Operations | 9% | 6% | 15% | 12% | ||||||||||||
Brazil Operations | 1 | % | 38 | % | (22)% | 4% | (11)% | 19% | ||||||||
Neogen Latinoamerica | (2 | )% | 13 | % | 13% | 23% | 6% | 18% | ||||||||
Neogen China | 105 | % | 106 | % | 59% | 51% | 77% | 72% | ||||||||
Neogen India | 10 | % | 18 | % | 5% | 8% | 7% | 12% | ||||||||
Neogen Canada | (11 | )% | (10 | )% | (17)% | (17)% | (14)% | (14)% | ||||||||
Neogen Australasia | 67 | % | 63 | % | 81% | 71% | 74% | 67% |
Three Months Ended November 30, | ||||||||||||||||||||||||||||||||
Three Months ended August 31, | Increase/ | |||||||||||||||||||||||||||||||
(in thousands) | 2020 | 2019 | Increase/ (Decrease) | % | 2020 | 2019 | (Decrease) | % | ||||||||||||||||||||||||
Food Safety | ||||||||||||||||||||||||||||||||
Natural Toxins, Allergens & Drug Residues | $ | 19,015 | $ | 20,115 | $ | (1,100 | ) | (5 | )% | $ | 20,001 | $ | 20,681 | $ | (680 | ) | (3 | )% | ||||||||||||||
Bacterial & General Sanitation | 9,931 | 10,316 | (385 | ) | (4 | )% | 11,235 | 11,615 | (380 | ) | (3 | )% | ||||||||||||||||||||
Culture Media & Other | 11,393 | 11,279 | 114 | 1 | % | 13,296 | 12,757 | 539 | 4 | % | ||||||||||||||||||||||
Rodenticides, Insecticides & Disinfectants | 9,608 | 5,449 | 4,159 | 76 | % | 7,978 | 7,447 | 531 | 7 | % | ||||||||||||||||||||||
Genomics Services | 4,238 | 3,862 | 376 | 10 | % | 5,024 | 4,354 | 670 | 15 | % | ||||||||||||||||||||||
$ | 54,185 | $ | 51,021 | $ | 3,164 | 6 | % | $ | 57,534 | $ | 56,854 | $ | 680 | 1 | % | |||||||||||||||||
Animal Safety | ||||||||||||||||||||||||||||||||
Life Sciences | $ | 1,325 | $ | 1,723 | $ | (398 | ) | (23 | )% | $ | 1,398 | $ | 1,803 | $ | (405 | ) | (22 | )% | ||||||||||||||
Veterinary Instruments & Disposables | 10,375 | 11,336 | (961 | ) | (8 | )% | 11,974 | 10,486 | 1,488 | 14 | % | |||||||||||||||||||||
Animal Care & Other | 7,658 | 6,405 | 1,253 | 20 | % | 9,371 | 7,787 | 1,584 | 20 | % | ||||||||||||||||||||||
Rodenticides, Insecticides & Disinfectants | 19,914 | 16,718 | 3,196 | 19 | % | 18,471 | 16,186 | 2,285 | 14 | % | ||||||||||||||||||||||
Genomics Services | 15,868 | 14,221 | 1,647 | 12 | % | 16,252 | 14,687 | 1,565 | 11 | % | ||||||||||||||||||||||
$ | 55,140 | $ | 50,403 | $ | 4,737 | 9 | % | $ | 57,466 | $ | 50,949 | $ | 6,517 | 13 | % | |||||||||||||||||
Total Revenues | $ | 109,325 | $ | 101,424 | $ | 7,901 | 8 | % | $ | 115,000 | $ | 107,803 | $ | 7,197 | 7 | % | ||||||||||||||||
Six Months Ended November 30, | ||||||||||||||||
Increase/ | ||||||||||||||||
(in thousands) | 2020 | 2019 | (Decrease) | % | ||||||||||||
Food Safety | ||||||||||||||||
Natural Toxins, Allergens & Drug Residues | $ | 39,016 | $ | 40,796 | $ | (1,780 | ) | (4 | )% | |||||||
Bacterial & General Sanitation | 21,166 | 21,931 | (765 | ) | (3 | )% | ||||||||||
Culture Media & Other | 24,689 | 24,037 | 652 | 3 | % | |||||||||||
Rodenticides, Insecticides & Disinfectants | 17,586 | 12,896 | 4,690 | 36 | % | |||||||||||
Genomics Services | 9,262 | 8,216 | 1,046 | 13 | % | |||||||||||
$ | 111,719 | $ | 107,876 | $ | 3,843 | 4 | % | |||||||||
Animal Safety | ||||||||||||||||
Life Sciences | $ | 2,723 | $ | 3,525 | $ | (802 | ) | (23 | )% | |||||||
Veterinary Instruments & Disposables | 22,349 | 21,822 | 527 | 2 | % | |||||||||||
Animal Care & Other | 17,029 | 14,193 | 2,836 | 20 | % | |||||||||||
Rodenticides, Insecticides & Disinfectants | 38,385 | 32,904 | 5,481 | 17 | % | |||||||||||
Genomics Services | 32,120 | 28,907 | 3,213 | 11 | % | |||||||||||
$ | 112,606 | $ | 101,351 | $ | 11,255 | 11 | % | |||||||||
Total Revenues | $ | 224,325 | $ | 209,227 | $ | 15,098 | 7 | % | ||||||||
Three Months ended August 31, | ||||||||
(dollars in thousands) | 2020 | 2019 | ||||||
Interest income (net of expense) | $ | 722 | $ | 1,510 | ||||
Foreign currency transactions | 175 | (117 | ) | |||||
Royalty income | — | 1 | ||||||
Other | 18 | (7 | ) | |||||
Total Other Income | $ | 915 | $ | 1,387 | ||||
Three Months Ended | Six Months Ended | |||||||||||||||
November 30, | November 30, | |||||||||||||||
(dollars in thousands) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Interest income (net of expense) | $ | 555 | $ | 1,271 | $ | 1,277 | $ | 2,781 | ||||||||
Foreign currency transactions | (432 | ) | (352 | ) | (256 | ) | (469 | ) | ||||||||
Insurance settlement | 309 | — | — | — | ||||||||||||
Legal settlement | (300 | ) | — | — | ||||||||||||
Other | (42 | ) | 35 | (16 | ) | 30 | ||||||||||
Total Other Income | $ | 90 | $ | 954 | $ | 1,005 | $ | 2,342 | ||||||||
NEOGEN CORPORATION | ||||||
(Registrant) |
/s/ John E. Adent | ||||||
John E. Adent | ||||||
President & Chief Executive Officer | ||||||
(Principal Executive Officer) |
/s/ Steven J. Quinlan | ||||||
Steven J. Quinlan | ||||||
Vice President & Chief Financial Officer | ||||||
(Principal Financial Officer and Principal Accounting Officer) |