Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 30, 2015 | Jul. 31, 2015 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | VIVO | |
Entity Registrant Name | MERIDIAN BIOSCIENCE INC | |
Entity Central Index Key | 794,172 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 41,714,635 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Statement [Abstract] | ||||
NET REVENUES | $ 48,204 | $ 47,212 | $ 147,762 | $ 142,140 |
COST OF SALES | 17,873 | 17,970 | 55,673 | 53,298 |
GROSS PROFIT | 30,331 | 29,242 | 92,089 | 88,842 |
OPERATING EXPENSES | ||||
Research and development | 3,214 | 3,146 | 9,685 | 9,185 |
Selling and marketing | 6,184 | 6,249 | 18,745 | 18,787 |
General and administrative | 6,535 | 6,715 | 20,860 | 20,446 |
Total operating expenses | 15,933 | 16,110 | 49,290 | 48,418 |
OPERATING INCOME | 14,398 | 13,132 | 42,799 | 40,424 |
OTHER INCOME (EXPENSE) | ||||
Interest income | 6 | 5 | 18 | 15 |
Other, net | (99) | (257) | (892) | (505) |
Total other income (expense) | (93) | (252) | (874) | (490) |
EARNINGS BEFORE INCOME TAXES | 14,305 | 12,880 | 41,925 | 39,934 |
INCOME TAX PROVISION | 5,203 | 4,045 | 14,852 | 13,373 |
NET EARNINGS | $ 9,102 | $ 8,835 | $ 27,073 | $ 26,561 |
BASIC EARNINGS PER COMMON SHARE | $ 0.22 | $ 0.21 | $ 0.65 | $ 0.64 |
DILUTED EARNINGS PER COMMON SHARE | $ 0.22 | $ 0.21 | $ 0.64 | $ 0.63 |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - BASIC | 41,714 | 41,478 | 41,647 | 41,445 |
EFFECT OF DILUTIVE STOCK OPTIONS AND RESTRICTED SHARES AND UNITS | 379 | 618 | 352 | 669 |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - DILUTED | 42,093 | 42,096 | 41,999 | 42,114 |
ANTI-DILUTIVE SECURITIES: | ||||
Common share options and restricted shares and units | 493 | 337 | 567 | 161 |
DIVIDENDS DECLARED PER COMMON SHARE | $ 0.20 | $ 0.20 | $ 0.60 | $ 0.59 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 9,102 | $ 8,835 | $ 27,073 | $ 26,561 |
Foreign currency translation adjustment | 1,357 | 361 | (2,146) | 1,421 |
COMPREHENSIVE INCOME | $ 10,459 | $ 9,196 | $ 24,927 | $ 27,982 |
Condensed Consolidated Stateme4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net earnings | $ 27,073 | $ 26,561 |
Non-cash items included in net earnings: | ||
Depreciation of property, plant and equipment | 2,585 | 2,634 |
Amortization of intangible assets | 1,309 | 1,549 |
Amortization of deferred illumigene instrument costs | 1,088 | 1,281 |
Stock-based compensation | 2,676 | 2,662 |
Deferred income taxes | (270) | (438) |
Loss on disposition and write-down of fixed assets and other assets | 39 | 22 |
Change in current assets | (4,399) | (6,804) |
Change in current liabilities | 796 | (4,055) |
Other, net | 299 | 199 |
Net cash provided by operating activities | 31,196 | 23,611 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | (3,783) | (3,968) |
Proceeds from sale of assets | 1,138 | |
Purchases of intangible assets | (1,687) | |
Net cash used for investing activities | (2,645) | (5,655) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Dividends paid | (25,014) | (24,464) |
Proceeds and tax benefits from exercises of stock options | 654 | 629 |
Net cash used for financing activities | (24,360) | (23,835) |
Effect of Exchange Rate Changes on Cash and Equivalents | (1,263) | 882 |
Net Increase (Decrease) in Cash and Equivalents | 2,928 | (4,997) |
Cash and Equivalents at Beginning of Period | 43,047 | 44,282 |
Cash and Equivalents at End of Period | $ 45,975 | $ 39,285 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2015 | Sep. 30, 2014 |
CURRENT ASSETS | ||
Cash and equivalents | $ 45,975 | $ 43,047 |
Accounts receivable, less allowances of $256 and $272 | 27,963 | 23,232 |
Inventories | 33,592 | 35,495 |
Prepaid expenses and other current assets | 6,439 | 7,058 |
Deferred income taxes | 4,006 | 3,916 |
Total current assets | 117,975 | 112,748 |
PROPERTY, PLANT AND EQUIPMENT, at Cost | ||
Land | 984 | 1,173 |
Buildings and improvements | 29,872 | 29,146 |
Machinery, equipment and furniture | 41,761 | 40,192 |
Construction in progress | 535 | 652 |
Subtotal | 73,152 | 71,163 |
Less: accumulated depreciation and amortization | 45,771 | 43,553 |
Net property, plant and equipment | 27,381 | 27,610 |
OTHER ASSETS | ||
Goodwill | 22,784 | 23,193 |
Other intangible assets, net | 6,374 | 7,813 |
Restricted cash | 1,000 | 1,000 |
Deferred illumigene instrument costs, net | 2,000 | 2,740 |
Deferred income taxes | 1,398 | 1,483 |
Other assets | 404 | 342 |
Total other assets | 33,960 | 36,571 |
TOTAL ASSETS | 179,316 | 176,929 |
CURRENT LIABILITIES | ||
Accounts payable | 5,453 | 4,966 |
Accrued employee compensation costs | 4,236 | 4,761 |
Other accrued expenses | 2,630 | 3,149 |
Income taxes payable | 969 | 859 |
Total current liabilities | 13,288 | 13,735 |
NON-CURRENT LIABILITIES | $ 2,097 | $ 2,165 |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS' EQUITY | ||
Preferred stock, no par value, 1,000,000 shares authorized, none issued | ||
Common shares, no par value, 71,000,000 shares authorized, 41,714,185 and 41,622,216 shares issued, respectively | $ 0 | $ 0 |
Additional paid-in capital | 114,840 | 111,851 |
Retained earnings | 50,928 | 48,869 |
Accumulated other comprehensive income | (1,837) | 309 |
Total shareholders' equity | 163,931 | 161,029 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 179,316 | $ 176,929 |
Condensed Consolidated Balance6
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands, None in scaling factor is -9223372036854775296 | Jun. 30, 2015 | Sep. 30, 2014 |
Statement of Financial Position [Abstract] | ||
Allowances for accounts receivable | $ 256 | $ 272 |
Preferred stock, par value | ||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | ||
Common stock, shares authorized | 71,000,000 | 71,000,000 |
Common stock, shares issued | 41,714,185 | 41,622,216 |
Condensed Consolidated Stateme7
Condensed Consolidated Statement of Changes in Shareholders Equity (Unaudited) - 9 months ended Jun. 30, 2015 - USD ($) shares in Thousands, $ in Thousands | Total | Common Shares Issued [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
Beginning balance at Sep. 30, 2014 | $ 161,029 | $ 111,851 | $ 48,869 | $ 309 | |
Beginning balance, Shares at Sep. 30, 2014 | 41,622 | ||||
Cash dividends paid | (25,014) | (25,014) | |||
Exercise of stock options | 313 | 313 | |||
Exercise of stock options, Shares | 65 | ||||
Conversion of restricted stock units | 27 | ||||
Stock compensation expense | 2,676 | 2,676 | |||
Net earnings | 27,073 | 27,073 | |||
Foreign currency translation adjustment | (2,146) | (2,146) | |||
Ending balance at Jun. 30, 2015 | $ 163,931 | $ 114,840 | $ 50,928 | $ (1,837) | |
Ending balance, Shares at Jun. 30, 2015 | 41,714 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Jun. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | 1. Basis of Presentation The interim condensed consolidated financial statements are unaudited and are prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information, and the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. In the opinion of Management, the interim financial statements include all normal adjustments and disclosures necessary to present fairly the Company’s financial position as of June 30, 2015, the results of its operations for the three and nine month periods ended June 30, 2015 and 2014, and its cash flows for the nine month periods ended June 30, 2015 and 2014. These statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s fiscal 2014 Annual Report on Form 10-K. Financial information as of September 30, 2014 has been derived from the Company’s audited consolidated financial statements. The results of operations for interim periods are not necessarily indicative of the results to be expected for the year. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. Significant Accounting Policies (a) Revenue Recognition and Accounts Receivable – Revenue is generally recognized from sales when product is shipped and title has passed to the customer. Revenue for the Diagnostics segment is reduced at the date of sale for product price adjustments due certain distributors under local contracts. Management estimates accruals for distributor price adjustments based on local contract terms, sales data provided by distributors, estimates of inventories of certain of our products held by distributors, historical statistics, current trends, and other factors. Changes to the accruals are recorded in the period that they become known. Such accruals were $4,431 at June 30, 2015 and $4,220 at September 30, 2014, and have been netted against accounts receivable. Revenue for our Diagnostics segment includes revenue for our illumi gene ® We evaluate whether each deliverable in the arrangement is a separate unit of accounting. The significant deliverables are an instrument, instrument accessories (e.g., printer) and test kits. An instrument and instrument accessories are delivered to the customer prior to the start of the customer utilization period, in order to accommodate customer set-up and installation. There is de minimis illumi gene In markets where the test system is not sold via multiple deliverable arrangements, the cost of the instrument and instrument accessories is charged to cost of sales at the time of shipment and transfer of title to the customer. Revenue for the sales of instruments and instrument accessories and test kits is recognized upon shipment and transfer of title to the customers. In these markets, our illumi gene Our products are generally not subject to a customer right of return except for product recall events under the rules and regulations of the Food and Drug Administration or equivalent agencies outside the United States. In this circumstance, the costs to replace affected products would be accrued at the time a loss was considered to be probable and estimable. Life Science revenue for contract services may come from research and development services or manufacturing services, including process development work, or a combination of both. Revenue is recognized based on each of the deliverables in a given arrangement having distinct and separate customer pricing. Depending on the nature of the arrangement, revenue is recognized as services are performed and billed, upon completion and acceptance by the customer, or upon delivery of product and acceptance by the customer. Trade accounts receivable are recorded in the accompanying Condensed Consolidated Balance Sheets at invoiced amounts less provisions for distributor price adjustments under local contracts and doubtful accounts. The allowance for doubtful accounts represents our estimate of probable credit losses and is based on historical write-off experience and known conditions that would likely lead to non-payment. The allowance for doubtful accounts and related metrics, such as days’ sales outstanding, are reviewed monthly. Accounts with past due balances over 90 days are reviewed individually for collectibility. Customer invoices are charged off against the allowance when we believe it is probable that the invoices will not be paid. (b) Comprehensive Income (Loss) – As reflected in the accompanying Condensed Consolidated Statements of Comprehensive Income, our comprehensive income or loss is comprised of net earnings and foreign currency translation. Assets and liabilities of foreign operations are translated using period-end exchange rates with gains or losses resulting from translation included as a separate component of comprehensive income or loss. Revenues and expenses are translated using exchange rates prevailing during the period. We also recognize foreign currency transaction gains and losses on certain assets and liabilities that are denominated in the non-functional currencies of the Company or its subsidiaries. These gains and losses are included in other income and expense in the accompanying Condensed Consolidated Statements of Operations. (c) Income Taxes – The provision for income taxes includes federal, foreign, state and local income taxes currently payable and those deferred because of temporary differences between income for financial reporting and income for tax purposes. We prepare estimates of permanent and temporary differences between income for financial reporting purposes and income for tax purposes. These differences are adjusted to actual upon filing of our tax returns, typically occurring in the third and fourth quarters of the current fiscal year for the preceding fiscal year’s estimates. We account for uncertain tax positions using a benefit recognition model with a two-step approach: (i) a more-likely-than-not recognition criterion; and (ii) a measurement attribute that measures the position as the largest amount of tax benefit that is greater than 50% likely of being ultimately realized upon settlement. If it is not more likely than not that the benefit will be sustained on its technical merits, no benefit is recorded. We recognize accrued interest and penalties related to unrecognized tax benefits as a portion of our income tax provision in the Condensed Consolidated Statements of Operations. In September 2013, the Internal Revenue Service issued Treasury Decision 9636, which enacted final tax regulations regarding the capitalization and expensing of amounts paid to acquire, produce or improve tangible property. The regulations also include guidance regarding the retirement of depreciable property. Our adoption of these regulations on October 1, 2014 did not have a significant impact on the Company’s consolidated results of operations, cash flows or financial position. (d) Stock-Based Compensation – We recognize compensation expense for all share-based awards made to employees, based upon the fair value of the share-based award on the date of the grant. Awards are expensed over their requisite service periods. For awards which vest solely on future service, we begin to expense such awards on the date of grant. For awards with performance conditions, we begin to expense such awards in the period upon which we believe there is sufficient evidence to support that it is probable that the performance condition(s) will be achieved. (e) Cash and Cash Equivalents – Cash and cash equivalents include the following components: June 30, 2015 September 30, 2014 Cash and Other Cash and Other Overnight repurchase agreements $ 23,315 $ — $ 26,407 $ — Cash on hand - Restricted — 1,000 — 1,000 Unrestricted 22,660 — 16,640 — Total $ 45,975 $ 1,000 $ 43,047 $ 1,000 (f) Recent Accounting Pronouncements – In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (g) Reclassifications – Certain reclassifications have been made to the prior fiscal period financial statements to conform to the current fiscal period presentation. Such reclassifications had no impact on net earnings or shareholders’ equity. |
Inventories
Inventories | 9 Months Ended |
Jun. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Inventories | 3. Inventories Inventories are comprised of the following: June 30, 2015 September 30, Raw materials $ 6,637 $ 5,674 Work-in-process 9,189 10,591 Finished goods - illumi gene 1,277 1,710 Finished goods - kits and reagents 16,489 17,520 Total $ 33,592 $ 35,495 |
Reportable Segment and Major Cu
Reportable Segment and Major Customers Information | 9 Months Ended |
Jun. 30, 2015 | |
Segment Reporting [Abstract] | |
Reportable Segment and Major Customers Information | 4. Reportable Segment and Major Customers Information Meridian was formed in 1976 and functions as a fully-integrated research, development, manufacturing, marketing and sales organization with primary emphasis in the fields of in vitro diagnostics and life science. Our principal businesses are (i) the development, manufacture and distribution of diagnostic test kits primarily for gastrointestinal, viral, respiratory and parasitic infectious diseases; and (ii) the manufacture and distribution of bulk antigens, antibodies, PCR/qPCR reagents, nucleotides, competent cells, and bioresearch reagents used by researchers and other diagnostic manufacturers, and the contract development and manufacture of proteins and other biologicals for use by biopharmaceutical and biotechnology companies engaged in research for new drugs and vaccines. Our reportable segments are Diagnostics and Life Science, both of which are headquartered in Cincinnati, Ohio, which also serves as the Diagnostics segment’s base of manufacturing operations and research and development. The Diagnostics segment has sales and distribution facilities in the United States, Europe and Australia. The Life Science segment consists of manufacturing operations in Memphis, Tennessee; Boca Raton, Florida; London, England; Luckenwalde, Germany; and Sydney, Australia, and the sale and distribution of bulk antigens, antibodies, PCR/qPCR reagents, nucleotides, competent cells, and bioresearch reagents, domestically and abroad, including sales and business development offices in Singapore and Beijing, China to further pursue growing revenue opportunities in Asia. The Life Science segment also includes the contract development and manufacture of cGMP clinical grade proteins and other biologicals for use by biopharmaceutical and biotechnology companies engaged in research for new drugs and vaccines. Amounts due from two Diagnostics distributor customers accounted for 23% and 15% of consolidated accounts receivable at June 30, 2015 and September 30, 2014, respectively. Revenues from these two distributor customers accounted for 35% and 36% of the Diagnostics segment’s third-party revenues during the three months ended June 30, 2015 and 2014, respectively, and 36% during each of the nine months ended June 30, 2015 and 2014. These distributors represented 27% of consolidated revenues for each of the fiscal 2015 and 2014 third quarters, and 27% and 28% for the fiscal 2015 and 2014 year-to-date nine month periods, respectively. In addition, approximately $2,000 and $2,700 of our consolidated accounts receivable at June 30, 2015 and September 30, 2014, respectively, was due from Italian hospital customers whose funding ultimately comes from the Italian government, representing 7% and 12% of consolidated accounts receivable in each of the respective periods. Within our Life Science segment, two diagnostic manufacturing customers accounted for 16% of the segment’s third-party revenues during each of the three months ended June 30, 2015 and 2014, and 16% and 17% during the nine months ended June 30, 2015 and 2014, respectively. Segment information for the interim periods is as follows: Diagnostics Life Science Eliminations(1) Total Three Months Ended June 30, 2015 Net revenues - Third-party $ 36,049 $ 12,155 $ — $ 48,204 Inter-segment 46 345 (391 ) — Operating income 11,203 3,240 (45 ) 14,398 Goodwill (June 30, 2015) 1,250 21,534 — 22,784 Other intangible assets, net (June 30, 2015) 2,436 3,938 — 6,374 Total assets (June 30, 2015) 117,602 61,955 (241 ) 179,316 Three Months Ended June 30, 2014 Net revenues - Third-party $ 35,168 $ 12,044 $ — $ 47,212 Inter-segment 99 374 (473 ) — Operating income 10,526 2,676 (70 ) 13,132 Goodwill (September 30, 2014) 1,250 21,943 — 23,193 Other intangible assets, net (September 30, 2014) 2,756 5,057 — 7,813 Total assets (September 30, 2014) 109,350 67,834 (255 ) 176,929 Nine Months Ended June 30, 2015 Net revenues - Third-party $ 111,297 $ 36,465 $ — $ 147,762 Inter-segment 235 867 (1,102 ) — Operating income 33,081 9,814 (96 ) 42,799 Nine Months Ended June 30, 2014 Net revenues - Third-party $ 107,066 $ 35,074 $ — $ 142,140 Inter-segment 362 858 (1,220 ) — Operating income 32,211 8,243 (30 ) 40,424 (1) Eliminations consist of inter-segment transactions. Transactions between segments are accounted for at established intercompany prices for internal and management purposes, with all intercompany amounts eliminated in consolidation. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 5. Intangible Assets A summary of our acquired intangible assets subject to amortization, as of June 30, 2015 and September 30, 2014, is as follows: June 30, 2015 September 30, 2014 Gross Accumulated Gross Accumulated Manufacturing technologies, core products and cell lines $ 11,635 $ 10,849 $ 11,685 $ 10,568 Trademarks, licenses and patents 6,390 3,167 6,463 2,766 Customer lists and supply agreements 12,246 9,881 12,378 9,379 $ 30,271 $ 23,897 $ 30,526 $ 22,713 The actual aggregate amortization expense for these intangible assets was $409 and $507 for the three months ended June 30, 2015 and 2014, respectively, and $1,309 and $1,549 for the nine months ended June 30, 2015 and 2014, respectively. The estimated aggregate amortization expense for these intangible assets for each of the fiscal years through fiscal 2020 is as follows: remainder of fiscal 2015 – $402, fiscal 2016 – $1,369, fiscal 2017 – $1,141, fiscal 2018 – $1,120, fiscal 2019 – $1,079 and fiscal 2020 – $903. |
Significant Accounting Polici13
Significant Accounting Policies (Policies) | 9 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Revenue Recognition and Accounts Receivable | (a) Revenue Recognition and Accounts Receivable – Revenue is generally recognized from sales when product is shipped and title has passed to the customer. Revenue for the Diagnostics segment is reduced at the date of sale for product price adjustments due certain distributors under local contracts. Management estimates accruals for distributor price adjustments based on local contract terms, sales data provided by distributors, estimates of inventories of certain of our products held by distributors, historical statistics, current trends, and other factors. Changes to the accruals are recorded in the period that they become known. Such accruals were $4,431 at June 30, 2015 and $4,220 at September 30, 2014, and have been netted against accounts receivable. Revenue for our Diagnostics segment includes revenue for our illumi gene ® We evaluate whether each deliverable in the arrangement is a separate unit of accounting. The significant deliverables are an instrument, instrument accessories (e.g., printer) and test kits. An instrument and instrument accessories are delivered to the customer prior to the start of the customer utilization period, in order to accommodate customer set-up and installation. There is de minimis illumi gene In markets where the test system is not sold via multiple deliverable arrangements, the cost of the instrument and instrument accessories is charged to cost of sales at the time of shipment and transfer of title to the customer. Revenue for the sales of instruments and instrument accessories and test kits is recognized upon shipment and transfer of title to the customers. In these markets, our illumi gene Our products are generally not subject to a customer right of return except for product recall events under the rules and regulations of the Food and Drug Administration or equivalent agencies outside the United States. In this circumstance, the costs to replace affected products would be accrued at the time a loss was considered to be probable and estimable. Life Science revenue for contract services may come from research and development services or manufacturing services, including process development work, or a combination of both. Revenue is recognized based on each of the deliverables in a given arrangement having distinct and separate customer pricing. Depending on the nature of the arrangement, revenue is recognized as services are performed and billed, upon completion and acceptance by the customer, or upon delivery of product and acceptance by the customer. Trade accounts receivable are recorded in the accompanying Condensed Consolidated Balance Sheets at invoiced amounts less provisions for distributor price adjustments under local contracts and doubtful accounts. The allowance for doubtful accounts represents our estimate of probable credit losses and is based on historical write-off experience and known conditions that would likely lead to non-payment. The allowance for doubtful accounts and related metrics, such as days’ sales outstanding, are reviewed monthly. Accounts with past due balances over 90 days are reviewed individually for collectibility. Customer invoices are charged off against the allowance when we believe it is probable that the invoices will not be paid. |
Comprehensive Income (Loss) | (b) Comprehensive Income (Loss) – As reflected in the accompanying Condensed Consolidated Statements of Comprehensive Income, our comprehensive income or loss is comprised of net earnings and foreign currency translation. Assets and liabilities of foreign operations are translated using period-end exchange rates with gains or losses resulting from translation included as a separate component of comprehensive income or loss. Revenues and expenses are translated using exchange rates prevailing during the period. We also recognize foreign currency transaction gains and losses on certain assets and liabilities that are denominated in the non-functional currencies of the Company or its subsidiaries. These gains and losses are included in other income and expense in the accompanying Condensed Consolidated Statements of Operations. |
Income Taxes | (c) Income Taxes – The provision for income taxes includes federal, foreign, state and local income taxes currently payable and those deferred because of temporary differences between income for financial reporting and income for tax purposes. We prepare estimates of permanent and temporary differences between income for financial reporting purposes and income for tax purposes. These differences are adjusted to actual upon filing of our tax returns, typically occurring in the third and fourth quarters of the current fiscal year for the preceding fiscal year’s estimates. We account for uncertain tax positions using a benefit recognition model with a two-step approach: (i) a more-likely-than-not recognition criterion; and (ii) a measurement attribute that measures the position as the largest amount of tax benefit that is greater than 50% likely of being ultimately realized upon settlement. If it is not more likely than not that the benefit will be sustained on its technical merits, no benefit is recorded. We recognize accrued interest and penalties related to unrecognized tax benefits as a portion of our income tax provision in the Condensed Consolidated Statements of Operations. In September 2013, the Internal Revenue Service issued Treasury Decision 9636, which enacted final tax regulations regarding the capitalization and expensing of amounts paid to acquire, produce or improve tangible property. The regulations also include guidance regarding the retirement of depreciable property. Our adoption of these regulations on October 1, 2014 did not have a significant impact on the Company’s consolidated results of operations, cash flows or financial position. |
Stock-Based Compensation | (d) Stock-Based Compensation – We recognize compensation expense for all share-based awards made to employees, based upon the fair value of the share-based award on the date of the grant. Awards are expensed over their requisite service periods. For awards which vest solely on future service, we begin to expense such awards on the date of grant. For awards with performance conditions, we begin to expense such awards in the period upon which we believe there is sufficient evidence to support that it is probable that the performance condition(s) will be achieved. |
Cash and Cash Equivalents | (e) Cash and Cash Equivalents – Cash and cash equivalents include the following components: June 30, 2015 September 30, 2014 Cash and Other Cash and Other Overnight repurchase agreements $ 23,315 $ — $ 26,407 $ — Cash on hand - Restricted — 1,000 — 1,000 Unrestricted 22,660 — 16,640 — Total $ 45,975 $ 1,000 $ 43,047 $ 1,000 |
Recent Accounting Pronouncements | (f) Recent Accounting Pronouncements – In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers |
Reclassifications | (g) Reclassifications – Certain reclassifications have been made to the prior fiscal period financial statements to conform to the current fiscal period presentation. Such reclassifications had no impact on net earnings or shareholders’ equity. |
Significant Accounting Polici14
Significant Accounting Policies (Tables) | 9 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Components of Cash and Cash Equivalents | Cash and cash equivalents include the following components: June 30, 2015 September 30, 2014 Cash and Other Cash and Other Overnight repurchase agreements $ 23,315 $ — $ 26,407 $ — Cash on hand - Restricted — 1,000 — 1,000 Unrestricted 22,660 — 16,640 — Total $ 45,975 $ 1,000 $ 43,047 $ 1,000 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Jun. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Components of Inventories | Inventories are comprised of the following: June 30, 2015 September 30, Raw materials $ 6,637 $ 5,674 Work-in-process 9,189 10,591 Finished goods - illumi gene 1,277 1,710 Finished goods - kits and reagents 16,489 17,520 Total $ 33,592 $ 35,495 |
Reportable Segment and Major 16
Reportable Segment and Major Customers Information (Tables) | 9 Months Ended |
Jun. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | Segment information for the interim periods is as follows: Diagnostics Life Science Eliminations(1) Total Three Months Ended June 30, 2015 Net revenues - Third-party $ 36,049 $ 12,155 $ — $ 48,204 Inter-segment 46 345 (391 ) — Operating income 11,203 3,240 (45 ) 14,398 Goodwill (June 30, 2015) 1,250 21,534 — 22,784 Other intangible assets, net (June 30, 2015) 2,436 3,938 — 6,374 Total assets (June 30, 2015) 117,602 61,955 (241 ) 179,316 Three Months Ended June 30, 2014 Net revenues - Third-party $ 35,168 $ 12,044 $ — $ 47,212 Inter-segment 99 374 (473 ) — Operating income 10,526 2,676 (70 ) 13,132 Goodwill (September 30, 2014) 1,250 21,943 — 23,193 Other intangible assets, net (September 30, 2014) 2,756 5,057 — 7,813 Total assets (September 30, 2014) 109,350 67,834 (255 ) 176,929 Nine Months Ended June 30, 2015 Net revenues - Third-party $ 111,297 $ 36,465 $ — $ 147,762 Inter-segment 235 867 (1,102 ) — Operating income 33,081 9,814 (96 ) 42,799 Nine Months Ended June 30, 2014 Net revenues - Third-party $ 107,066 $ 35,074 $ — $ 142,140 Inter-segment 362 858 (1,220 ) — Operating income 32,211 8,243 (30 ) 40,424 (1) Eliminations consist of inter-segment transactions. |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Acquired Intangible Assets Subject to Amortization | A summary of our acquired intangible assets subject to amortization, as of June 30, 2015 and September 30, 2014, is as follows: June 30, 2015 September 30, 2014 Gross Accumulated Gross Accumulated Manufacturing technologies, core products and cell lines $ 11,635 $ 10,849 $ 11,685 $ 10,568 Trademarks, licenses and patents 6,390 3,167 6,463 2,766 Customer lists and supply agreements 12,246 9,881 12,378 9,379 $ 30,271 $ 23,897 $ 30,526 $ 22,713 |
Significant Accounting Polici18
Significant Accounting Policies - Additional Information (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2015 | Sep. 30, 2014 | |
Accounting Policies [Abstract] | ||
Accrued distributor price adjustments | $ 4,431 | $ 4,220 |
Expected instrument utilization period | 3 years | |
Period of review of accounts individually | 90 days | |
Likelihood percentage of tax benefit being recognized upon ultimate settlement | 50.00% | |
Tax benefits recognized from uncertain tax positions measurement | We account for uncertain tax positions using a benefit recognition model with a two-step approach: (i) a more-likely-than-not recognition criterion; and (ii) a measurement attribute that measures the position as the largest amount of tax benefit that is greater than 50% likely of being ultimately realized upon settlement. |
Significant Accounting Polici19
Significant Accounting Policies - Components of Cash and Cash Equivalents (Detail) - USD ($) $ in Thousands | Jun. 30, 2015 | Sep. 30, 2014 | Jun. 30, 2014 | Sep. 30, 2013 |
Cash and Cash Equivalents [Line Items] | ||||
Cash on hand - Restricted | $ 1,000 | $ 1,000 | ||
Total | 45,975 | 43,047 | $ 39,285 | $ 44,282 |
Cash and Equivalents [Member] | ||||
Cash and Cash Equivalents [Line Items] | ||||
Overnight repurchase agreements | 23,315 | 26,407 | ||
Cash on hand - Unrestricted | 22,660 | 16,640 | ||
Total | 45,975 | 43,047 | ||
Other Assets [Member] | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash on hand - Restricted | 1,000 | 1,000 | ||
Total | $ 1,000 | $ 1,000 |
Inventories - Components of Inv
Inventories - Components of Inventories (Detail) - USD ($) $ in Thousands | Jun. 30, 2015 | Sep. 30, 2014 |
Inventory [Line Items] | ||
Raw materials | $ 6,637 | $ 5,674 |
Work-in-process | 9,189 | 10,591 |
Total | 33,592 | 35,495 |
Illumigene Instruments [Member] | ||
Inventory [Line Items] | ||
Finished goods | 1,277 | 1,710 |
Kits and Reagents [Member] | ||
Inventory [Line Items] | ||
Finished goods | $ 16,489 | $ 17,520 |
Reportable Segment and Major 21
Reportable Segment and Major Customers Information - Additional Information (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jun. 30, 2015USD ($) | Jun. 30, 2014 | Jun. 30, 2015USD ($)Customer | Jun. 30, 2014 | Sep. 30, 2014USD ($) | |
Two Diagnostic Manufacturing Customers [Member] | Segment, Third-Party Sales Revenue [Member] | Customer Concentration Risk [Member] | Life Science [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Number of major customers | 2 | ||||
Concentration Risk Percentage | 16.00% | 16.00% | 16.00% | 17.00% | |
Two Diagnostic Distributor Customers [Member] | Segment, Third-Party Sales Revenue [Member] | Customer Concentration Risk [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Number of major customers | 2 | ||||
Two Diagnostic Distributor Customers [Member] | Segment, Third-Party Sales Revenue [Member] | Customer Concentration Risk [Member] | Diagnostics [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Concentration Risk Percentage | 35.00% | 36.00% | 36.00% | 36.00% | |
Two Diagnostic Distributor Customers [Member] | Consolidated Accounts Receivable [Member] | Customer Concentration Risk [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Number of major customers | 2 | ||||
Concentration Risk Percentage | 23.00% | 15.00% | |||
Two Diagnostic Distributor Customers [Member] | Consolidated Revenues [Member] | Customer Concentration Risk [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Concentration Risk Percentage | 27.00% | 27.00% | 27.00% | 28.00% | |
Hospital Customers [Member] | Italy [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Account receivable | $ | $ 2,000 | $ 2,000 | $ 2,700 | ||
Hospital Customers [Member] | Consolidated Accounts Receivable [Member] | Customer Concentration Risk [Member] | Italy [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Concentration Risk Percentage | 7.00% | 12.00% |
Reportable Segment and Major 22
Reportable Segment and Major Customers Information - Segment Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Sep. 30, 2014 | |
Segment Reporting Information [Line Items] | |||||
Net revenues | $ 48,204 | $ 47,212 | $ 147,762 | $ 142,140 | |
Operating income | 14,398 | 13,132 | 42,799 | 40,424 | |
Goodwill | 22,784 | 22,784 | $ 23,193 | ||
Other intangible assets, net | 6,374 | 6,374 | 7,813 | ||
Total assets | 179,316 | 179,316 | 176,929 | ||
Inter-segment [Member] | Diagnostics [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net revenues | 46 | 99 | 235 | 362 | |
Inter-segment [Member] | Life Science [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net revenues | 345 | 374 | 867 | 858 | |
Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net revenues | (391) | (473) | (1,102) | (1,220) | |
Operating income | (45) | (70) | (96) | (30) | |
Total assets | (241) | (241) | (255) | ||
Operating Segments [Member] | Diagnostics [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net revenues | 36,049 | 35,168 | 111,297 | 107,066 | |
Operating income | 11,203 | 10,526 | 33,081 | 32,211 | |
Goodwill | 1,250 | 1,250 | 1,250 | ||
Other intangible assets, net | 2,436 | 2,436 | 2,756 | ||
Total assets | 117,602 | 117,602 | 109,350 | ||
Operating Segments [Member] | Life Science [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net revenues | 12,155 | 12,044 | 36,465 | 35,074 | |
Operating income | 3,240 | $ 2,676 | 9,814 | $ 8,243 | |
Goodwill | 21,534 | 21,534 | 21,943 | ||
Other intangible assets, net | 3,938 | 3,938 | 5,057 | ||
Total assets | $ 61,955 | $ 61,955 | $ 67,834 |
Intangible Assets - Summary of
Intangible Assets - Summary of Acquired Intangible Assets Subject to Amortization (Detail) - USD ($) $ in Thousands | Jun. 30, 2015 | Sep. 30, 2014 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 30,271 | $ 30,526 |
Accumulated Amortization | 23,897 | 22,713 |
Manufacturing Technologies, Core Products and Cell Lines [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 11,635 | 11,685 |
Accumulated Amortization | 10,849 | 10,568 |
Trademarks, Licenses and Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 6,390 | 6,463 |
Accumulated Amortization | 3,167 | 2,766 |
Customer Lists and Supply Agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 12,246 | 12,378 |
Accumulated Amortization | $ 9,881 | $ 9,379 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of intangible assets | $ 409 | $ 507 | $ 1,309 | $ 1,549 |
Estimated amortization expense for intangible assets remainder of fiscal year 2015 | 402 | 402 | ||
2,016 | 1,369 | 1,369 | ||
2,017 | 1,141 | 1,141 | ||
2,018 | 1,120 | 1,120 | ||
2,019 | 1,079 | 1,079 | ||
2,020 | $ 903 | $ 903 |