Exhibit 99.1
FOR IMMEDIATE RELEASE
| | |
| CONTACT: | | Steve Quinlan, Vice President & CFO |
| | Neogen Corporation, 517/372-9200 |
Neogen reports third quarter results
LANSING, Mich., March 23, 2021 — Neogen Corporation (NASDAQ: NEOG) announced today that its revenues for the third quarter of its 2021 fiscal year, which ended Feb. 28, were $116,709,000, up 17% from the previous year’s third quarter revenues of $99,869,000. Current year-to-date revenues were $341,034,000, up 10% compared to $309,096,000 for the same period a year ago.
Third quarter net income was $13,377,000, up 10% compared to the prior year’s $12,200,000. Earnings per share in the current quarter were $0.25, compared to $0.23 a year ago. Current year-to-date net income was $45,122,000, or $0.85 per share, compared to $43,128,000, or $0.82 per share, for the same period a year ago.
“We are pleased to report strong top-line growth this quarter and I am proud of the entire Neogen team for making these results possible,” said John Adent, Neogen’s president and chief executive officer. “We fully understand we are not out of the woods yet with the adverse effects of the global pandemic, but this quarter demonstrates what we are capable of achieving under these extremely challenging market conditions. We are also encouraged by a number of important product regulatory approvals and registrations that we received during the quarter, which will help drive future growth.”
Neogen’s gross margin was 46.1% of sales in its third quarter of the current year, compared to 45.4% recorded in the same quarter of the prior fiscal year. The change in margin percentage was the result of a product mix shift toward products with higher margins, particularly the rodenticide product line. During the quarter, the company incurred more than $2 million in expenses for strategic consulting, due diligence and other professional fees, the result of acquisition activities for businesses which Neogen was ultimately not successful in acquiring; these non-recurring expenses reduced earnings by approximately $0.03 per share. Operating income was $15,774,000, or 13.5% of sales, for the third quarter, compared to $13,043,000, or 13.1%, in the same quarter a year ago. Interest income, at $294,000, was approximately $1.3 million lower than last year’s third quarter, due to a precipitous drop in yield on marketable securities.
“While our bottom line was negatively impacted by non-recurring expenses related to acquisition activities and lower interest income, we were pleased with our operating performance for the quarter,” said Steve Quinlan, Neogen’s chief financial officer. “For the first time in many quarters, currency translations did not have a significant net adverse impact on our comparative consolidated revenues. Some currencies in which we do business, including the British pound, the euro, Australian dollar, and Chinese yuan, have improved against the U.S. dollar, year over year, while others, including the Brazilian real and the Mexican peso, have devalued.”
Revenues for the company’s Food Safety segment increased 16% during the third quarter compared to the prior year quarter. The growth was aided in part by international acquisitions within the past year, including Megazyme, a food quality diagnostics company located near Dublin, Ireland, acquired on December 30, 2020. On an organic basis, the segment’s revenue increased 11% comparatively. The segment’s increase was led by a 14% improvement in sales of its diagnostic test kits to detect natural toxins in food and animal feed, including increases in sales of its aflatoxin test kits (up 25%). Natural toxin product sales rose, in part, in response to an outbreak of aflatoxin in dog food that has spread to 35 countries, killed more than 100 dogs, and sickened hundreds more.
