☒ | 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) |
Title of each Class | Trading | 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 | ||||||
Emerging growth company | ☐ | |||||
Page No. | ||||||
Item 1. | 2 | |||||
2 | ||||||
3 | ||||||
4 | ||||||
5 | ||||||
6 | ||||||
7 | ||||||
Item 2. | ||||||
Item 3. | ||||||
Item 4. | ||||||
Item 1. | ||||||
Item 6. | ||||||
CEO Certification | ||||||
CFO Certification | ||||||
Section 906 Certification |
November 30, | May 31, | |||||||
2021 | 2021 | |||||||
Assets | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 51,119 | $ | 75,602 | ||||
Marketable securities | 338,130 | 305,485 | ||||||
Accounts receivable, less allowance of $1,500 and $1,400 at November 30, 2021 and May 31, 2021, respectively | 92,498 | 91,823 | ||||||
Inventories | 107,086 | 100,701 | ||||||
Prepaid expenses and other current assets | 22,371 | 17,840 | ||||||
Total Current Assets | 611,204 | 591,451 | ||||||
Net Property and Equipment | 100,863 | 100,453 | ||||||
Other assets | ||||||||
Right of use assets | 2,171 | 2,477 | ||||||
Goodwill | 142,613 | 131,476 | ||||||
Other non-amortizable intangible assets | 15,359 | 15,545 | ||||||
Amortizable intangible and other assets, net of accumulated amortization of $51,012 and $53,462 at November 30, 2021 and May 31, 2021, respectively | 93,706 | 76,771 | ||||||
Other non-current assets | 2,018 | 2,019 | ||||||
Total Assets | $ | 967,934 | $ | 920,192 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current Liabilities | ||||||||
Accounts payable | $ | 34,222 | $ | 23,900 | ||||
Accrued compensation | 9,636 | 11,251 | ||||||
Income taxes | 0 | 1,848 | ||||||
Other accruals | 18,815 | 16,600 | ||||||
Total Current Liabilities | 62,673 | 53,599 | ||||||
Deferred Income Taxes | 21,829 | 21,917 | ||||||
Other Non-Current Liabilities | 17,956 | 4,299 | ||||||
Total Liabilities | 101,204 | 79,815 | ||||||
Commitments and Contingencies (note 10) | 0 | 0 | ||||||
Equity | ||||||||
Preferred stock, $1.00 par value, 100,000 shares authorized,NaN issued and outstanding | 0 | 0 | ||||||
Common stock, $0.16 par value, 120,000,000 shares authorized, 107,768,342 and 107,468,304 shares issued and outstanding at November 30, 2021 and May 31, 2021, respectively | 17,243 | 17,195 | ||||||
Additional paid-in capital | 304,959 | 294,953 | ||||||
Accumulated other comprehensive loss | (24,235 | ) | (11,375 | ) | ||||
Retained earnings | 567,509 | 539,604 | ||||||
Total Stockholders’ Equity | 865,476 | 840,377 | ||||||
Total Liabilities and Stockholders’ Equity | $ | 967,934 | $ | 920,192 | ||||
August 31, | May 31, | |||||||
2022 | 2022 | |||||||
Assets | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 107,098 | $ | 44,473 | ||||
Marketable securities | 240,613 | 336,578 | ||||||
Accounts receivable, net of allowance of $1,800 and $1,650 at August 31, 2022 and May 31, 2022, respectively | 93,112 | 99,674 | ||||||
Inventories | 129,039 | 122,313 | ||||||
Prepaid expenses and other current assets | 38,045 | 23,760 | ||||||
Total Current Assets | 607,907 | 626,798 | ||||||
Net Property and Equipment | 121,021 | 110,584 | ||||||
Other Assets | ||||||||
Right of use assets | 2,834 | 3,184 | ||||||
Goodwill | 140,067 | 142,704 | ||||||
Other non-amortizable intangible assets | 15,182 | 15,397 | ||||||
Amortizable intangible and other assets, net of accumulated amortization of $55,201 and $55,416 at August 31, 2022 and May 31, 2022, respectively | 88,239 | 92,106 | ||||||
Other non-current assets | 2,155 | 2,156 | ||||||
Total Assets | $ | 977,405 | $ | 992,929 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current Liabilities | ||||||||
Accounts payable | $ | 27,002 | $ | 34,614 | ||||
Accrued compensation | 8,295 | 11,123 | ||||||
Income tax payable | 3,921 | 2,126 | ||||||
Deferred revenue | 5,464 | 5,460 | ||||||
Other accruals | 22,322 | 24,521 | ||||||
Total Current Liabilities | 67,004 | 77,844 | ||||||
Deferred Income Tax Liability | 15,949 | 17,011 | ||||||
Other Non-Current Liabilities | 10,654 | 10,700 | ||||||
Total Liabilities | 93,607 | 105,555 | ||||||
Commitments and Contingencies (note 10) | ||||||||
Equity | ||||||||
Preferred stock, $1.00 par value, 100,000 shares authorized, none issued and outstanding | — | — | ||||||
Common stock, $0.16 par value, 120,000,000 shares authorized, 107,837,730 and 107,801,094 shares issued and outstanding at August 31, 2022 and May 31, 2022, respectively | 17,254 | 17,248 | ||||||
Additional paid-in capital | 312,750 | 309,984 | ||||||
Accumulated other comprehensive loss | (39,326 | ) | (27,769 | ) | ||||
Retained earnings | 593,120 | 587,911 | ||||||
Total Stockholders’ Equity | 883,798 | 887,374 | ||||||
Total Liabilities and Stockholders’ Equity | $ | 977,405 | $ | 992,929 | ||||
Three Months Ended | Six Months Ended | |||||||||||||||
November 30, | November 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Revenues | ||||||||||||||||
Product revenues | $ | 106,111 | $ | 92,537 | $ | 210,124 | $ | 180,472 | ||||||||
Service revenues | 24,406 | 22,463 | 48,698 | 43,853 | ||||||||||||
Total Revenues | 130,517 | 115,000 | 258,822 | 224,325 | ||||||||||||
Cost of Revenues | ||||||||||||||||
Cost of product revenues | 56,374 | 49,275 | 111,100 | 95,870 | ||||||||||||
Cost of service revenues | 13,549 | 12,511 | 27,120 | 24,939 | ||||||||||||
Total Cost of Revenues | 69,923 | 61,786 | 138,220 | 120,809 | ||||||||||||
Gross Margin | 60,594 | 53,214 | 120,602 | 103,516 | ||||||||||||
Operating Expenses | ||||||||||||||||
Sales and marketing | 21,188 | 17,729 | 41,743 | 34,245 | ||||||||||||
General and administrative | 22,605 | 12,184 | 35,988 | 23,197 | ||||||||||||
Research and development | 4,332 | 4,056 | 8,657 | 7,934 | ||||||||||||
Total Operating Expenses | 48,125 | 33,969 | 86,388 | 65,376 | ||||||||||||
Operating Income | 12,469 | 19,245 | 34,214 | 38,140 | ||||||||||||
Other Income (Expense) | ||||||||||||||||
Interest income | 224 | 555 | 427 | 1,277 | ||||||||||||
Other income (expense) | 235 | (465 | ) | 14 | (272 | ) | ||||||||||
Total Other Income | 459 | 90 | 441 | 1,005 | ||||||||||||
Income Before Taxes | 12,928 | 19,335 | 34,655 | 39,145 | ||||||||||||
Provision for Income Taxes | 2,100 | 3,450 | 6,750 | 7,400 | ||||||||||||
Net Income | $ | 10,828 | $ | 15,885 | $ | 27,905 | $ | 31,745 | ||||||||
Net Income Per Share | ||||||||||||||||
Basic | $ | 0.10 | $ | 0.15 | $ | 0.26 | $ | 0.30 | ||||||||
Diluted | $ | 0.10 | $ | 0.15 | $ | 0.26 | $ | 0.30 | ||||||||
Weighted Average Shares Outstanding | ||||||||||||||||
Basic | 107,641 | 106,258 | 107,565 | 106,044 | ||||||||||||
Diluted | 108,122 | 106,808 | 108,099 | 106,600 |
Three Months Ended | ||||||||
August 31, | ||||||||
2022 | 2021 | |||||||
Revenues | ||||||||
Product revenues | $ | 106,792 | $ | 104,013 | ||||
Service revenues | 25,557 | 24,292 | ||||||
Total Revenues | 132,349 | 128,305 | ||||||
Cost of Revenues | ||||||||
Cost of product revenues | 55,441 | 54,726 | ||||||
Cost of service revenues | 14,638 | 13,571 | ||||||
Total Cost of Revenues | 70,079 | 68,297 | ||||||
Gross Margin | 62,270 | 60,008 | ||||||
Operating Expenses | ||||||||
Sales and marketing | 23,383 | 20,555 | ||||||
General and administrative | 27,944 | 13,383 | ||||||
Research and development | 4,881 | 4,325 | ||||||
Total Operating Expenses | 56,208 | 38,263 | ||||||
Operating Income | 6,062 | 21,745 | ||||||
Other Income (Expense) | ||||||||
Interest income | 969 | 203 | ||||||
Other expense | (372 | ) | (221 | ) | ||||
Total Other Income (Expense) | 597 | (18 | ) | |||||
Income Before Taxes | 6,659 | 21,727 | ||||||
Provision for Income Taxes | 1,450 | 4,650 | ||||||
Net Income | $ | 5,209 | $ | 17,077 | ||||
Net Income Per Share | ||||||||
Basic | $ | 0.05 | $ | 0.16 | ||||
Diluted | $ | 0.05 | $ | 0.16 | ||||
Weighted Average Shares Outstanding | ||||||||
Basic | 107,837 | 107,490 | ||||||
Diluted | 107,857 | 108,109 |
Three Months Ended | Six Months Ended | |||||||||||||||
November 30, | November 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Net income | $ | 10,828 | $ | 15,885 | $ | 27,905 | $ | 31,745 | ||||||||
Other comprehensive income (loss), net of tax: | ||||||||||||||||
foreign currency translations | (7,649 | ) | 938 | (12,272 | ) | 5,059 | ||||||||||
Other comprehensive loss, net of tax: | ||||||||||||||||
unrealized loss on marketable securities | (382 | ) | (317 | ) | (588 | ) | (436 | ) | ||||||||
Total comprehensive income | $ | 2,797 | $ | 16,506 | $ | 15,045 | $ | 36,368 | ||||||||
Three Months Ended | ||||||||
August 31, | ||||||||
2022 | 2021 | |||||||
Net income | $ | 5,209 | $ | 17,077 | ||||
Foreign currency translations | (11,133 | ) | (4,623 | ) | ||||
Unrealized loss on marketable securities, net of tax | (424 | ) | (206 | ) | ||||
Total comprehensive income (loss) | $ | (6,348 | ) | $ | 12,248 | |||
Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Total | ||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||
Balance, June 1, 2022 | 107,801 | $ | 17,248 | $ | 309,984 | $ | (27,769 | ) | $ | 587,911 | $ | 887,374 | ||||||||||||
Exercise of options and share-based compensation expense | 4 | 1 | 1,904 | — | — | 1,905 | ||||||||||||||||||
Issuance of shares under employee stock purchase plan | 33 | 5 | 862 | — | — | 867 | ||||||||||||||||||
Net income for the three months ended August 31, 2022 | — | — | — | — | 5,209 | 5,209 | ||||||||||||||||||
Other comprehensive loss for the three months ended August 31, 2022 | — | — | — | (11,557 | ) | — | (11,557 | ) | ||||||||||||||||
Balance, August 31, 2022 | 107,838 | $ | 17,254 | $ | 312,750 | $ | (39,326 | ) | $ | 593,120 | $ | 883,798 |
Accumulated | ||||||||||||||||||||||||
Additional | Other | |||||||||||||||||||||||
Common Stock | Paid-in | Comprehensive | Retained | |||||||||||||||||||||
Shares | Amount | Capital | Income (Loss) | Earnings | Total | |||||||||||||||||||
Balance, June 1, 2021 | 107,468 | $ | 17,195 | $ | 294,953 | $ | (11,375 | ) | $ | 539,604 | $ | 840,377 | ||||||||||||
Exercise of options and share-based compensation expense | 6 | 1 | 1,838 | — | — | 1,839 | ||||||||||||||||||
Issuance of shares under employee stock purchase plan | 19 | 3 | 896 | — | — | 899 | ||||||||||||||||||
Net income for the three months ended August 31, 2021 | — | — | — | — | 17,077 | 17,077 | ||||||||||||||||||
Other comprehensive loss for the three months ended August 31, 2021 | — | — | — | (4,829 | ) | — | (4,829 | ) | ||||||||||||||||
Balance, August 31, 2021 | 107,493 | $ | 17,199 | $ | 297,687 | $ | (16,204 | ) | $ | 556,681 | $ | 855,363 | ||||||||||||
Exercise of options and share-based compensation expense | 275 | 44 | 7,272 | — | — | 7,316 | ||||||||||||||||||
Net income for the three months ended November 30, 2021 | — | — | — | — | 10,828 | 10,828 | ||||||||||||||||||
Other comprehensive loss for the three months ended November 30, 2021 | — | — | — | (8,031 | ) | — | (8,031 | ) | ||||||||||||||||
Balance, November 30, 2021 | 107,768 | 17,243 | 304,959 | $ | (24,235 | ) | $ | 567,509 | $ | 865,476 | ||||||||||||||
Balance, June 1, 2020 | 105,892 | $ | 16,943 | $ | 249,221 | $ | (19,709 | ) | $ | 478,722 | $ | 725,177 | ||||||||||||
Exercise of options and share-based compensation expense | 172 | 28 | 5,811 | — | — | 5,839 | ||||||||||||||||||
Issuance of shares under employee stock purchase plan | 18 | 3 | 665 | — | — | 668 | ||||||||||||||||||
Net income for the three months ended August 31, 2020 | — | — | — | — | 15,860 | 15,860 | ||||||||||||||||||
Other comprehensive income for the three months ended August 31, 2020 | — | — | — | 4,002 | — | 4,002 | ||||||||||||||||||
Balance, August 31, 2020 | 106,082 | $ | 16,974 | $ | 255,697 | $ | (15,707 | ) | $ | 494,582 | $ | 751,546 | ||||||||||||
Exercise of options and share-based compensation expense | 406 | 64 | 9,279 | — | — | 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 | 106,488 | 17,038 | 264,976 | (15,086 | ) | 510,467 | 777,395 | |||||||||||||||||
Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Total | ||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||
Balance, June 1, 2021 | 107,468 | $ | 17,195 | $ | 294,953 | $ | (11,375 | ) | $ | 539,604 | $ | 840,377 | ||||||||||||
Exercise of options and share-based compensation expense | 6 | 1 | 1,838 | — | — | 1,839 | ||||||||||||||||||
Issuance of shares under employee stock purchase plan | 19 | 3 | 896 | — | — | 899 | ||||||||||||||||||
Net income for the three months ended August 31, 2021 | — | — | — | — | 17,077 | 17,077 | ||||||||||||||||||
Other comprehensive income for the three months ended August 31, 2021 | — | — | — | (4,829 | ) | — | (4,829 | ) | ||||||||||||||||
Balance, August 31, 2021 | 107,493 | $ | 17,199 | $ | 297,687 | $ | (16,204 | ) | $ | 556,681 | $ | 855,363 |
Six Months Ended | ||||||||
November 30, | ||||||||
2021 | 2020 | |||||||
Cash Flows From Operating Activities | ||||||||
Net Income | $ | 27,905 | $ | 31,745 | ||||
Adjustments to reconcile net income to net cash from operating activities: | ||||||||
Depreciation and amortization | 11,511 | 9,523 | ||||||
Share-based compensation | 3,438 | 3,192 | ||||||
Change in operating assets and liabilities, net of business acquisitions: | ||||||||
Accounts receivable | (1,500 | ) | 6,662 | |||||
Inventories | (6,929 | ) | 4,063 | |||||
Prepaid expenses and other current assets | (3,709 | ) | (2,080 | ) | ||||
Accounts payable, accruals and other changes | 10,341 | (5,581 | ) | |||||
Net Cash From Operating Activities | 41,057 | 47,524 | ||||||
Cash Flows For Investing Activities | ||||||||
Purchases of property, equipment and other non-current intangible assets | (5,235 | ) | (11,092 | ) | ||||
Proceeds from the sale of marketable securities | 197,941 | 309,030 | ||||||
Purchases of marketable securities | (230,586 | ) | (308,524 | ) | ||||
Business acquisitions, net of cash acquired | (26,864 | ) | (2,350 | ) | ||||
Net Cash For Investing Activities | (64,744 | ) | (12,936 | ) | ||||
Cash Flows From Financing Activities | ||||||||
Exercise of stock options and issuance of employee stock purchase plan shares | 6,619 | 12,658 | ||||||
Net Cash From Financing Activities | 6,619 | 12,658 | ||||||
Effect of Foreign Exchange Rates on Cash | (7,415 | ) | 352 | |||||
Net Increase (Decrease) In Cash and Cash Equivalents | (24,483 | ) | 47,598 | |||||
Cash and Cash Equivalents, Beginning of Period | 75,602 | 66,269 | ||||||
Cash and Cash Equivalents, End of Period | $ | 51,119 | $ | 113,867 | ||||
Three Months Ended | ||||||||
August 31, | ||||||||
2022 | 2021 | |||||||
Cash Flows (For) From Operating Activities | ||||||||
Net Income | $ | 5,209 | $ | 17,077 | ||||
Adjustments to reconcile net income to net cash ( f or) from operating activities: | ||||||||
Depreciation and amortization | 5,729 | 5,682 | ||||||
Deferred income taxes | (1,439 | ) | (15 | ) | ||||
Share-based compensation | 1,867 | 1,690 | ||||||
Change in operating assets and liabilities, net of business acquisitions: | ||||||||
Accounts receivable | 4,819 | 4,036 | ||||||
Inventories | (8,330 | ) | (1,863 | ) | ||||
Prepaid expenses and other current assets | (14,682 | ) | (1,014 | ) | ||||
Accounts payable, accruals and other changes | (7,316 | ) | (2,383 | ) | ||||
Net Cash (For) From Operating Activities | (14,143 | ) | 23,210 | |||||
Cash Flows From (For) Investing Activities | ||||||||
Purchases of property, equipment and other non-current intangible assets | (12,996 | ) | (1,295 | ) | ||||
Proceeds from the sale of marketable securities | 108,488 | 112,636 | ||||||
Purchases of marketable securities | (12,523 | ) | (136,748 | ) | ||||
Business acquisitions, net of cash acquired | (1,331 | ) | — | |||||
Net Cash From (For) Investing Activities | 81,638 | (25,407 | ) | |||||
Cash Flows From Financing Activities | ||||||||
Exercise of stock options and issuance of employee stock purchase plan shares | 905 | 1,048 | ||||||
Net Cash From Financing Activities | 905 | 1,048 | ||||||
Effect of Foreign Exchange Rates on Cash | (5,775 | ) | (3,170 | ) | ||||
Net Increase (Decrease) In Cash and Cash Equivalents | 62,625 | (4,319 | ) | |||||
Cash and Cash Equivalents, Beginning of Period | 44,473 | 75,602 | ||||||
Cash and Cash Equivalents, End of Period | $ | 107,098 | $ | 71,283 | ||||
November 30, | May 31, | |||||||||||||||||||
(in thousands) | Maturity | 2021 | 2021 | Maturity | August 31, 2022 | May 31, 2022 | ||||||||||||||
Commercial Paper & Corporate Bonds | 0 - 90 days | 79,830 | 106,631 | 0 - 90 days | $ | 63,375 | $ | 106,497 | ||||||||||||
91 - 180 days | 88,246 | 78,727 | 91 - 180 days | 60,950 | 61,373 | |||||||||||||||
181 days - 1 year | 64,526 | 87,590 | 181 days - 1 year | 57,135 | 91,706 | |||||||||||||||
1 - 2 years | 104,275 | 26,752 | 1 - 2 years | 59,153 | 77,002 | |||||||||||||||
Certificates of Deposit | 0 - 90 days | 1,002 | 3,262 | |||||||||||||||||
91 - 180 days | 251 | 1,260 | ||||||||||||||||||
181 days - 1 year | 0 | 1,263 | ||||||||||||||||||
1 - 2 years | 0 | 0 | ||||||||||||||||||
Total Marketable Securities | $ | 338,130 | $ | 305,485 | $ | 240,613 | $ | 336,578 | ||||||||||||
Amortized | Unrealized | Unrealized | ||||||||||||||
(in thousands) | Cost | Gains | Losses | Fair Value | ||||||||||||
Commercial Paper & Corporate Bonds | 337,437 | 18 | (578 | ) | 336,877 | |||||||||||
Certificates of Deposit | 1,251 | 2 | 0— | 1,253 | ||||||||||||
Total Marketable Securities | $ | 338,688 | $ | 20 | $ | (578 | ) | $ | 338,130 | |||||||
(in thousands) | Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | ||||||||||||
Commercial Paper & Corporate Bonds | $ | 244,125 | $ | — | $ | (3,512 | ) | $ | 240,613 |
(in thousands) | Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | ||||||||||||
Commercial Paper & Corporate Bonds | $ | 339,540 | $ | 7 | $ | (2,969 | ) | $ | 336,578 |
Amortized | Unrealized | Unrealized | ||||||||||||||
(in thousands) | Cost | Gains | Losses | Fair Value | ||||||||||||
Commercial Paper & Corporate Bonds | 299,524 | 209 | (33 | ) | 299,700 | |||||||||||
Certificates of Deposit | 5,755 | 30 | 0— | 5,785 | ||||||||||||
Total Marketable Securities | $ | 305,279 | $ | 239 | $ | (33 | ) | $ | 305,485 | |||||||
November 30, | May 31, | |||||||||||||||
(in thousands) | 2021 | 2021 | August 31, 2022 | May 31, 2022 | ||||||||||||
Raw materials | $ | 53,940 | $ | 47,588 | $ | 62,134 | $ | 58,667 | ||||||||
Work-in-process | 6,303 | 6,412 | 6,241 | 6,388 | ||||||||||||
Finished and purchased goods | 46,843 | 46,701 | 60,664 | 57,258 | ||||||||||||
$ | 107,086 | $ | 100,701 | $ | 129,039 | $ | 122,313 | |||||||||
Three Months ended August 31, | ||||||||
(in thousands) | 2022 | 2021 | ||||||
Food Safety | ||||||||
Natural Toxins, Allergens & Drug Residues | $ | 19,787 | $ | 20,408 | ||||
Bacterial & General Sanitation | 10,728 | 11,165 | ||||||
Culture Media & Other | 19,254 | 18,046 | ||||||
Rodent Control, Insect Control & Disinfectants | 9,575 | 7,649 | ||||||
Genomics Services | 5,299 | 5,454 | ||||||
$ | 64,643 | $ | 62,722 | |||||
Animal Safety | ||||||||
Life Sciences | $ | 1,589 | $ | 1,363 | ||||
Veterinary Instruments & Disposables | 14,673 | 15,337 | ||||||
Animal Care & Other | 10,526 | 9,219 | ||||||
Rodent Control, Insect Control & Disinfectants | 22,214 | 22,149 | ||||||
Genomics Services | 18,704 | 17,515 | ||||||
$ | 67,706 | $ | 65,583 | |||||
Total Revenues | $ | 132,349 | $ | 128,305 | ||||
Three Months ended November 30, | Six Months ended November 30, | |||||||||||||||
(in thousands) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
Food Safety | ||||||||||||||||
Natural Toxins, Allergens & Drug Residues | $ | 21,028 | $ | 20,001 | $ | 41,432 | $ | 39,016 | ||||||||
Bacterial & General Sanitation | 12,252 | 11,235 | 23,421 | 21,166 | ||||||||||||
Culture Media & Other | 19,935 | 14,215 | 37,981 | 26,387 | ||||||||||||
Rodenticides, Insecticides & Disinfectants | 8,232 | 7,059 | 15,882 | 15,888 | ||||||||||||
Genomics Services | 5,685 | 5,024 | 11,138 | 9,262 | ||||||||||||
$ | 67,132 | $ | 57,534 | $ | 129,854 | $ | 111,719 | |||||||||
Animal Safety | ||||||||||||||||
Life Sciences | $ | 1,309 | $ | 1,398 | $ | 2,672 | $ | 2,723 | ||||||||
Veterinary Instruments & Disposables | 15,572 | 11,974 | 30,909 | 22,349 | ||||||||||||
Animal Care & Other | 10,849 | 9,371 | 20,068 | 17,029 | ||||||||||||
Rodenticides, Insecticides & Disinfectants | 18,269 | 18,471 | 40,418 | 38,385 | ||||||||||||
Genomics Services | 17,386 | 16,252 | 34,901 | 32,120 | ||||||||||||
$ | 63,385 | $ | 57,466 | $ | 128,968 | $ | 112,606 | |||||||||
Total Revenues | $ | 130,517 | $ | 115,000 | $ | 258,822 | $ | 224,325 | ||||||||
Three Months Ended | Six Months Ended | Three Months Ended | ||||||||||||||||||||||
November 30, | November 30, | August 31, | ||||||||||||||||||||||
(in thousands, except per share amounts) | 2021 | 2020 | 2021 | 2020 | 2022 | 2021 | ||||||||||||||||||
Numerator for basic and diluted net income per share: | ||||||||||||||||||||||||
Net income attributable to Neogen | $ | 10,828 | $ | 15,885 | $ | 27,905 | $ | 31,745 | $ | 5,209 | $ | 17,077 | ||||||||||||
Denominator for basic net income per share: | ||||||||||||||||||||||||
Weighted average shares | 107,641 | 106,258 | 107,565 | 106,044 | 107,837 | 107,490 | ||||||||||||||||||
Effect of dilutive stock options and RSUs | 481 | 550 | 534 | 556 | 20 | 619 | ||||||||||||||||||
Denominator for diluted net income per share | 108,122 | 106,808 | 108,099 | 106,600 | $ | 107,857 | $ | 108,109 | ||||||||||||||||
Net income attributable to Neogen per share: | ||||||||||||||||||||||||
Basic | $ | 0.10 | $ | 0.15 | $ | 0.26 | $ | 0.30 | $ | 0.05 | $ | 0.16 | ||||||||||||
Diluted | $ | 0.10 | $ | 0.15 | $ | 0.26 | $ | 0.30 | $ | 0.05 | $ | 0.16 | ||||||||||||
Corporate and | ||||||||||||||||
Food | Animal | Eliminations | ||||||||||||||
(in thousands) | Safety | Safety | (1) | Total | ||||||||||||
As of and for the three months ended November 30, 2021 | ||||||||||||||||
Product revenues to external customers | $ | 60,112 | $ | 45,999 | $ | — | $ | 106,111 | ||||||||
Service revenues to external customers | 7,020 | 17,386 | — | 24,406 | ||||||||||||
Total revenues to external customers | 67,132 | 63,385 | — | 130,517 | ||||||||||||
Operating income (loss) | 10,894 | 12,701 | (11,126 | ) | 12,469 | |||||||||||
Total assets | 298,437 | 278,994 | 390,503 | 967,934 | ||||||||||||
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 |
(in thousands) | Food Safety | Animal Safety | Corporate and Eliminations (1) | Total | ||||||||||||
As of and for the three months ended August 31, 2022 | ||||||||||||||||
Product revenues to external customers | $ | 57,790 | $ | 49,002 | $ | — | $ | 106,792 | ||||||||
Service revenues to external customers | 6,853 | 18,704 | — | 25,557 | ||||||||||||
Total revenues to external customers | 64,643 | 67,706 | — | 132,349 | ||||||||||||
Operating income (loss) | 8,597 | 11,881 | (14,416 | ) | 6,062 | |||||||||||
Total assets | 318,463 | 311,231 | 347,711 | 977,405 | ||||||||||||
As of and for the three months ended August 31, 2021 | ||||||||||||||||
Product revenues to external customers | $ | 55,945 | $ | 48,068 | $ | — | $ | 104,013 | ||||||||
Service revenues to external customers | 6,777 | 17,515 | — | 24,292 | ||||||||||||
Total revenues to external customers | 62,722 | 65,583 | — | 128,305 | ||||||||||||
Operating income (loss) | 10,131 | 12,762 | (1,148 | ) | 21,745 | |||||||||||
Total assets | 291,018 | 240,208 | 400,880 | 932,106 |
(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, 2021 | ||||||||||||||||
Product revenues to external customers | $ | 116,057 | $ | 94,067 | $ | — | $ | 210,124 | ||||||||
Service revenues to external customers | 13,797 | 34,901 | — | 48,698 | ||||||||||||
Total revenues to external customers | 129,854 | 128,968 | — | 258,822 | ||||||||||||
Operating income (loss) | 21,026 | 25,463 | (12,275 | ) | 34,214 | |||||||||||
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 |
Three months ended | Six months ended | |||||||||||||||
November 30, | November 30, | |||||||||||||||
(in thousands) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
Domestic | $ | 76,378 | $ | 69,832 | $ | 154,156 | $ | 137,156 | ||||||||
International | 54,139 | 45,168 | 104,666 | 87,169 | ||||||||||||
Total revenue | 130,517 | 115,000 | 258,822 | 224,325 | ||||||||||||
Three months ended August 31, | ||||||||
(in thousands) | 2022 | 2021 | ||||||
Domestic | $ | 80,642 | $ | 77,779 | ||||
International | 51,707 | 50,526 | ||||||
Total revenue | $ | 132,349 | $ | 128,305 | ||||
Weighted- | ||||||||||||||||
Average | ||||||||||||||||
(Options in thousands) | Shares | Exercise Price | Shares | Weighted- Average Exercise Price | ||||||||||||
Options outstanding June 1, 2021 | 2,957 | $ | 30.38 | |||||||||||||
Options outstanding June 1, 2022 | 3,244 | $ | 32.13 | |||||||||||||
Granted | 392 | 40.93 | — | — | ||||||||||||
Exercised | (262 | ) | 22.42 | (4 | ) | 10.75 | ||||||||||
Forfeited | (21 | ) | 31.11 | (110 | ) | 26.94 | ||||||||||
Options outstanding November 30, 2021 | 3,066 | $ | 32.40 | |||||||||||||
Options outstanding August 31, 2022 | 3,130 | $ | 32.32 |
FY 2022 | FY 2021 | |||||||
Risk-free interest rate | 0.4 | % | 0.2 | % | ||||
Expected dividend yield | 0.0 | % | 0.0 | % | ||||
Expected stock price volatility | 32.8 | % | 31.3 | % | ||||
Expected option life | 3.12 years | 3.25 years |
FY 2022 | ||||
Risk-free interest rate | 0.4 | % | ||
Expected dividend yield | 0.0 | % | ||
Expected stock price volatility | 32.8 | % | ||
Expected option life | 3.12 years |
(Options in thousands) | Shares | Weighted- Average Fair Value | ||||||
RSUs outstanding June 1, 2022 | 257 | $ | 36.14 | |||||
Granted | — | — | ||||||
Released | — | — | ||||||
Forfeited | (4 | ) | 37.60 | |||||
RSUs outstanding August 31, 2022 | 253 | $ | 36.12 |
Weighted- | ||||||||
Average | ||||||||
(Options in thousands) | Shares | Fair Value | ||||||
RSUs outstanding June 1, 2021 | 121 | $ | 34.21 | |||||
Granted | 120 | 40.92 | ||||||
Released | (25 | ) | 34.24 | |||||
Forfeited | (3 | ) | 34.49 | |||||
RSUs outstanding November 30, 2021 | 213 | $ | 37.97 |
(In thousands) | ||||||||||
Fair Value of Derivatives Not Designated as Hedging Instruments | Balance Sheet Location | August 31, 2022 | May 31, 2022 | |||||||
Foreign currency forward contracts, net | Prepaid and Other | $ | 421 | $ | (78 | ) |
(In thousands) | ||||||||||
Derivatives Not Designated as Hedging Instruments | Location in statements of income | August 31, 2022 | August 31, 2021 | |||||||
Foreign currency forward contracts | Other income (expense) | $ | 882 | $ | 521 |
August 31, | ||||||||||||
(in thousands) | 2022 | 2021 | % | |||||||||
Consolidated | ||||||||||||
Revenues | $ | 132,349 | $ | 128,305 | 3 | % | ||||||
Organic Sales Growth | 0 | % | ||||||||||
Food Safety | ||||||||||||
Revenues | $ | 64,643 | $ | 62,722 | 3 | % | ||||||
Organic Sales Growth | 1 | % | ||||||||||
Animal Safety | ||||||||||||
Revenues | $ | 67,706 | $ | 65,583 | 3 | % | ||||||
Organic Sales Growth | 0 | % | ||||||||||
% of International Sales | 39 | % | 39 | % | ||||||||
Effective Tax Rate | 21.8 | % | 21.4 | % | ||||||||
Net Income | $ | 5,209 | $ | 17,077 | -69 | % | ||||||
EBITDA* | $ | 11,419 | $ | 27,206 | -58 | % | ||||||
Adjusted EBITDA* | $ | 27,018 | $ | 28,896 | -6 | % | ||||||
Per Diluted Share | $ | 0.05 | $ | 0.16 | ||||||||
Cash (for) from Operations | $ | (14,143 | ) | $ | 23,210 |
* | Refer to non-GAAP financial measure section in this document. |
Three Months Ended | Six Months Ended | Three Months Ended August 31, 2022 | ||||||||||||||||||||||
November 30, 2021 | November 30, 2021 | Revenue % Inc (Dec) USD | Revenue % Inc (Dec) Local Currency | |||||||||||||||||||||
Revenue | Revenue | Revenue | Revenue | |||||||||||||||||||||
% Inc (Dec) | % Inc (Dec) | % Inc (Dec) | % Inc (Dec) | |||||||||||||||||||||
USD | Local Currency | USD | Local Currency | |||||||||||||||||||||
U.K Operations (including Neogen Italia) | 20 | % | 14 | % | 13 | % | 6 | % | ||||||||||||||||
U.K. Operations (including Neogen Italia) | 5 | % | 19 | % | ||||||||||||||||||||
Megazyme | (13 | )% | 1 | % | ||||||||||||||||||||
Brazil Operations | (5 | )% | (6 | )% | (10 | )% | (12 | )% | 13 | % | 14 | % | ||||||||||||
Neogen Latinoamerica | 13 | % | 10 | % | 18 | % | 10 | % | 19 | % | 20 | % | ||||||||||||
Neogen Argentina | 44 | % | 84 | % | 28 | % | 68 | % | 34 | % | 78 | % | ||||||||||||
Neogen Uruguay | (4 | )% | (2 | )% | 3 | % | 5 | % | 1 | % | (6 | )% | ||||||||||||
Neogen Chile | 48 | % | 54 | % | 59 | % | 59 | % | (4 | )% | 16 | % | ||||||||||||
Neogen China | 28 | % | 22 | % | 42 | % | 34 | % | (18 | )% | (14 | )% | ||||||||||||
Neogen India | (10 | )% | (9 | )% | 1 | % | 1 | % | 25 | % | 33 | % | ||||||||||||
Neogen Canada | 34 | % | 28 | % | 60 | % | 50 | % | (7 | )% | (3 | )% | ||||||||||||
Neogen Australasia | 29 | % | 27 | % | 38 | % | 33 | % | (8 | )% | (2 | )% |
Three Months Ended November 30, | ||||||||||||||||
Increase/ | ||||||||||||||||
(in thousands) | 2021 | 2020 | (Decrease) | % | ||||||||||||
Food Safety | ||||||||||||||||
Natural Toxins, Allergens & Drug Residues | $ | 21,028 | $ | 20,001 | $ | 1,027 | 5 | % | ||||||||
Bacterial & General Sanitation | 12,252 | 11,235 | 1,017 | 9 | % | |||||||||||
Culture Media & Other | 19,935 | 14,215 | 5,720 | 40 | % | |||||||||||
Rodenticides, Insecticides & Disinfectants | 8,232 | 7,059 | 1,173 | 17 | % | |||||||||||
Genomics Services | 5,685 | 5,024 | 661 | 13 | % | |||||||||||
$ | 67,132 | $ | 57,534 | $ | 9,598 | 17 | % | |||||||||
Animal Safety | ||||||||||||||||
Life Sciences | $ | 1,309 | $ | 1,398 | $ | (89 | ) | (6 | )% | |||||||
Veterinary Instruments & Disposables | 15,572 | 11,974 | 3,598 | 30 | % | |||||||||||
Animal Care & Other | 10,849 | 9,371 | 1,478 | 16 | % | |||||||||||
Rodenticides, Insecticides & Disinfectants | 18,269 | 18,471 | (202 | ) | (1 | )% | ||||||||||
Genomics Services | 17,386 | 16,252 | 1,134 | 7 | % | |||||||||||
$ | 63,385 | $ | 57,466 | $ | 5,919 | 10 | % | |||||||||
Total Revenues | $ | 130,517 | $ | 115,000 | $ | 15,517 | 13 | % | ||||||||
Six Months Ended November 30, | ||||||||||||||||||||||||||||||||
Increase/ | Three Months Ended August 31, | Increase/ (Decrease) | % | |||||||||||||||||||||||||||||
(in thousands) | 2021 | 2020 | (Decrease) | % | 2022 | 2021 | ||||||||||||||||||||||||||
Food Safety | ||||||||||||||||||||||||||||||||
Natural Toxins, Allergens & Drug Residues | $ | 41,432 | $ | 39,016 | $ | 2,416 | 6 | % | $ | 19,787 | $ | 20,408 | $ | (504 | ) | (3 | )% | |||||||||||||||
Bacterial & General Sanitation | 23,421 | 21,166 | 2,255 | 11 | % | 10,728 | 11,165 | (437 | ) | (4 | )% | |||||||||||||||||||||
Culture Media & Other | 37,981 | 26,387 | 11,594 | 44 | % | 19,254 | 18,046 | 1,091 | 7 | % | ||||||||||||||||||||||
Rodenticides, Insecticides & Disinfectants | 15,882 | 15,888 | (6 | ) | 0 | % | ||||||||||||||||||||||||||
Rodent Control, Insect Control & Disinfectants | 9,575 | 7,649 | 1,926 | 25 | % | |||||||||||||||||||||||||||
Genomics Services | 11,138 | 9,262 | 1,876 | 20 | % | 5,299 | 5,454 | (155 | ) | (3 | )% | |||||||||||||||||||||
$ | 129,854 | $ | 111,719 | $ | 18,135 | 16 | % | $ | 64,643 | $ | 62,722 | $ | 1,921 | 3 | % | |||||||||||||||||
Animal Safety | ||||||||||||||||||||||||||||||||
Life Sciences | $ | 2,672 | $ | 2,723 | $ | (51 | ) | (2 | )% | $ | 1,589 | $ | 1,363 | $ | 226 | 17 | % | |||||||||||||||
Veterinary Instruments & Disposables | 30,909 | 22,349 | 8,560 | 38 | % | 14,673 | 15,337 | (664 | ) | (4 | )% | |||||||||||||||||||||
Animal Care & Other | 20,068 | 17,029 | 3,039 | 18 | % | 10,526 | 9,219 | 1,307 | 14 | % | ||||||||||||||||||||||
Rodenticides, Insecticides & Disinfectants | 40,418 | 38,385 | 2,033 | 5 | % | |||||||||||||||||||||||||||
Rodent Control, Insect Control & Disinfectants | 22,214 | 22,149 | 65 | 0 | % | |||||||||||||||||||||||||||
Genomics Services | 34,901 | 32,120 | 2,781 | 9 | % | 18,704 | 17,515 | 1,189 | 7 | % | ||||||||||||||||||||||
$ | 128,968 | $ | 112,606 | $ | 16,362 | 15 | % | $ | 67,706 | $ | 65,583 | $ | 2,123 | 3 | % | |||||||||||||||||
Total Revenues | $ | 258,822 | $ | 224,325 | $ | 34,497 | 15 | % | $ | 132,349 | $ | 128,305 | $ | 4,044 | 3 | % | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||||||
November 30, | November 30, | Three Months Ended August 31, | ||||||||||||||||||||||
(dollars in thousands) | 2021 | 2020 | 2021 | 2020 | 2022 | 2021 | ||||||||||||||||||
Interest income (net of expense) | $ | 217 | $ | 555 | $ | 420 | $ | 1,277 | $ | 969 | $ | 203 | ||||||||||||
Foreign currency transactions | 167 | (432 | ) | 15 | (256 | ) | (421 | ) | (151 | ) | ||||||||||||||
Insurance settlement | — | 309 | — | — | ||||||||||||||||||||
Legal settlement | — | (300 | ) | — | — | |||||||||||||||||||
LGS contingent consideration | (135 | ) | — | (135 | ) | — | ||||||||||||||||||
Other | 210 | (42 | ) | 141 | (16 | ) | 49 | (70 | ) | |||||||||||||||
Total Other Income | $ | 459 | $ | 90 | $ | 441 | $ | 1,005 | $ | 597 | $ | (18 | ) | |||||||||||
Three Months Ended August 31 | ||||||||
(Dollars in thousands) | 2022 | 2021 | ||||||
Net Income | $ | 5,209 | $ | 17,077 | ||||
Net income margin % | 3.9 | % | 13.3 | % | ||||
Provision for income taxes | 1,450 | 4,650 | ||||||
Depreciation and amortization | 5,729 | 5,682 | ||||||
Interest income, net | (969 | ) | (203 | ) | ||||
EBITDA | $ | 11,419 | $ | 27,206 | ||||
Stock-based compensation | 1,867 | 1,690 | ||||||
Certain transaction fees and expenses | 13,732 | — | ||||||
Adjusted EBITDA | $ | 27,018 | $ | 28,896 | ||||
Adjusted EBITDA margin % | 20.4 | % | 22.5 | % |
Risk Category | Hypothetical Change | November 30, 2021 | Impact | Hypothetical Change | August 31, 2022 | Impact | ||||||||||||
(dollars in thousands) | ||||||||||||||||||
Foreign Currency - Revenue | 10% Decrease in exchange rates | $ | 5,414 | Earnings | 10% Decrease in exchange rates | $ | 4,309 | Earnings | ||||||||||
Foreign Currency - Hedges | 10% Decrease in exchange rates | 1,959 | Earnings | 10% Decrease in exchange rates | 1,822 | Fair Value | ||||||||||||
Interest Income | 10% Decrease in exchange rates | 97 | Earnings |
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) |