Exhibit 99.1
Press Release
Bio-Rad Reports Third-Quarter 2014 Financial Results
HERCULES, CA - November 4, 2014 - Bio-Rad Laboratories, Inc. (NYSE: BIO and BIOb), a multinational manufacturer and distributor of life science research and clinical diagnostic products, announced financial results today for the third quarter ended September 30, 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 BIOb) 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.
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
investor_relations@bio-rad.com
Bio-Rad Laboratories, Inc.
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
|
| | | | | | | | | | | | | | | |
| | Three Months Ended | | Nine Months Ended |
| | September 30, | | 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,
2014 | | December 31,
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 |
|
