Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2016 | Apr. 30, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 | |
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 | 42,074,802 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Income Statement [Abstract] | ||||
NET REVENUES | $ 51,259 | $ 51,545 | $ 98,419 | $ 99,558 |
COST OF SALES | 17,687 | 19,024 | 33,264 | 37,800 |
GROSS PROFIT | 33,572 | 32,521 | 65,155 | 61,758 |
OPERATING EXPENSES | ||||
Research and development | 3,129 | 3,368 | 6,510 | 6,471 |
Selling and marketing | 7,210 | 6,481 | 13,653 | 12,561 |
General and administrative | 6,875 | 6,940 | 14,769 | 14,325 |
Transaction costs | 1,202 | 1,481 | ||
Total operating expenses | 18,416 | 16,789 | 36,413 | 33,357 |
OPERATING INCOME | 15,156 | 15,732 | 28,742 | 28,401 |
OTHER INCOME (EXPENSE) | ||||
Interest income | 3 | 6 | 20 | 12 |
Interest expense | (43) | (43) | ||
Other, net | (324) | (211) | (228) | (793) |
Total other income (expense) | (364) | (205) | (251) | (781) |
EARNINGS BEFORE INCOME TAXES | 14,792 | 15,527 | 28,491 | 27,620 |
INCOME TAX PROVISION | 5,701 | 5,457 | 10,507 | 9,649 |
NET EARNINGS | $ 9,091 | $ 10,070 | $ 17,984 | $ 17,971 |
BASIC EARNINGS PER COMMON SHARE | $ 0.22 | $ 0.24 | $ 0.43 | $ 0.43 |
DILUTED EARNINGS PER COMMON SHARE | $ 0.21 | $ 0.24 | $ 0.42 | $ 0.43 |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - BASIC | 42,053 | 41,707 | 41,984 | 41,636 |
EFFECT OF DILUTIVE STOCK OPTIONS AND RESTRICTED SHARES AND UNITS | 372 | 341 | 376 | 336 |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - DILUTED | 42,425 | 42,048 | 42,360 | 41,972 |
ANTI-DILUTIVE SECURITIES: | ||||
Common share options and restricted shares and units | 444 | 570 | 476 | 546 |
DIVIDENDS DECLARED PER COMMON SHARE | $ 0.20 | $ 0.20 | $ 0.40 | $ 0.40 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings | $ 9,091 | $ 10,070 | $ 17,984 | $ 17,971 |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustment | (78) | (2,138) | (865) | (3,503) |
Unrealized loss on cash flow hedge | (694) | (694) | ||
Income taxes related to items of other comprehensive income | 243 | 243 | ||
Other comprehensive income (loss), net of tax | (529) | (2,138) | (1,316) | (3,503) |
COMPREHENSIVE INCOME | $ 8,562 | $ 7,932 | $ 16,668 | $ 14,468 |
Condensed Consolidated Stateme4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net earnings | $ 17,984 | $ 17,971 |
Non-cash items included in net earnings: | ||
Depreciation of property, plant and equipment | 1,785 | 1,832 |
Amortization of intangible assets | 762 | 900 |
Amortization of deferred instrument costs | 544 | 754 |
Stock-based compensation | 2,290 | 1,954 |
Deferred income taxes | (306) | (257) |
Losses on long-lived assets | 659 | |
Change in current assets, net of acquisition | (6,905) | (6,910) |
Change in current liabilities, net of acquisition | 1,505 | 3,368 |
Other, net | 143 | 419 |
Net cash provided by operating activities | 18,461 | 20,031 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of property, plant and equipment | (1,524) | (2,561) |
Purchase of equity method investment | (600) | |
Acquisition of Magellan, net of cash received | (62,177) | |
Purchase of intangible assets | (16) | |
Net cash used for investing activities | (64,317) | (2,561) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Dividends paid | (16,817) | (16,671) |
Proceeds from term loan, net of issuance costs | 59,842 | |
Proceeds and tax benefits from exercises of stock options | 1,969 | 654 |
Net cash provided by (used for) financing activities | 44,994 | (16,017) |
Effect of Exchange Rate Changes on Cash and Equivalents | (165) | (1,781) |
Net Decrease in Cash and Equivalents | (1,027) | (328) |
Cash and Equivalents at Beginning of Period | 49,973 | 43,047 |
Cash and Equivalents at End of Period | $ 48,946 | $ 42,719 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2016 | Sep. 30, 2015 |
CURRENT ASSETS | ||
Cash and equivalents | $ 48,946 | $ 49,973 |
Accounts receivable, less allowances of $320 and $248 | 32,450 | 26,254 |
Inventories | 41,934 | 35,817 |
Prepaid expenses and other current assets | 4,866 | 7,378 |
Total current assets | 128,196 | 119,422 |
PROPERTY, PLANT AND EQUIPMENT, at Cost | ||
Land | 987 | 986 |
Buildings and improvements | 30,870 | 30,056 |
Machinery, equipment and furniture | 45,009 | 41,541 |
Construction in progress | 1,223 | 1,139 |
Subtotal | 78,089 | 73,722 |
Less: accumulated depreciation and amortization | 47,906 | 46,230 |
Net property, plant and equipment | 30,183 | 27,492 |
OTHER ASSETS | ||
Goodwill | 64,457 | 22,349 |
Other intangible assets, net | 32,602 | 5,931 |
Restricted cash | 1,000 | 1,000 |
Deferred instrument costs, net | 1,567 | 1,750 |
Deferred income taxes | 4,954 | |
Other assets | 356 | 384 |
Total other assets | 99,982 | 36,368 |
TOTAL ASSETS | 258,361 | 183,282 |
CURRENT LIABILITIES | ||
Accounts payable | 7,891 | 6,646 |
Accrued employee compensation costs | 5,888 | 5,132 |
Other accrued expenses | 3,680 | 2,587 |
Current portion of long-term debt | 3,000 | |
Income taxes payable | 807 | 886 |
Total current liabilities | 21,266 | 15,251 |
NON-CURRENT LIABILITIES | ||
Acquisition consideration payable | 2,198 | |
Non-current compensation liabilities | 2,204 | 2,158 |
Interest rate swap liability | 694 | |
Long-term debt | 56,842 | |
Deferred income taxes | 5,311 | |
Total non-current liabilities | $ 67,249 | $ 2,158 |
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, 42,074,542 and 41,838,399 shares issued, respectively | $ 0 | $ 0 |
Additional paid-in capital | 121,273 | 117,151 |
Retained earnings | 52,219 | 51,052 |
Accumulated other comprehensive income | (3,646) | (2,330) |
Total shareholders' equity | 169,846 | 165,873 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 258,361 | $ 183,282 |
Condensed Consolidated Balance6
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2016 | Sep. 30, 2015 |
Statement of Financial Position [Abstract] | ||
Allowances for accounts receivable | $ 320 | $ 248 |
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 | 42,074,542 | 41,838,399 |
Condensed Consolidated Stateme7
Condensed Consolidated Statement of Changes in Shareholders' Equity (Unaudited) - 6 months ended Mar. 31, 2016 - 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, 2015 | $ 165,873 | $ 117,151 | $ 51,052 | $ (2,330) | |
Beginning balance, Shares at Sep. 30, 2015 | 41,838 | ||||
Cash dividends paid | (16,817) | (16,817) | |||
Exercise of stock options | 1,832 | 1,832 | |||
Exercise of stock options, Shares | 121 | ||||
Conversion of restricted stock units | 116 | ||||
Stock compensation expense | 2,290 | 2,290 | |||
Net earnings | 17,984 | 17,984 | |||
Foreign currency translation adjustment | (865) | (865) | |||
Hedging activity, net of tax | (451) | (451) | |||
Ending balance at Mar. 31, 2016 | $ 169,846 | $ 121,273 | $ 52,219 | $ (3,646) | |
Ending balance, Shares at Mar. 31, 2016 | 42,075 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Mar. 31, 2016 | |
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 March 31, 2016, the results of its operations for the three and six month periods ended March 31, 2016 and 2015, and its cash flows for the six month periods ended March 31, 2016 and 2015. These statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in the Company’s fiscal 2015 Annual Report on Form 10-K. Financial information as of September 30, 2015 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. The Company’s Condensed Consolidated Balance Sheet as of March 31, 2016 includes the condensed balance sheet of Magellan Biosciences, Inc., and its wholly-owned subsidiary Magellan Diagnostics, Inc. (collectively, “Magellan”), as set forth and more fully described in Note 3. Due to the immateriality of the amounts, revenues and expenses related to Magellan for the period owned by the Company (March 24 – March 31, 2016) are excluded from the Company’s Condensed Consolidated Statements of Operations for the three or six months ended March 31, 2016. |
Significant Accounting Policies
Significant Accounting Policies | 6 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. Significant Accounting Policies A summary of the Company’s significant accounting policies is included in Note 1 to the audited consolidated financial statements of the Company’s fiscal 2015 Annual Report on Form 10-K. (a) Recent Accounting Pronouncements – In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes In February 2016, the FASB issued ASU 2016-02, Leases In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting Issued but not yet effective accounting pronouncements are not expected to have a material impact on the Condensed Consolidated Financial Statements. (b) Reclassifications – Certain reclassifications have been made to the prior period financial statements to conform to the current fiscal period presentation. Such reclassifications had no impact on net earnings or shareholders’ equity. |
Acquisition of Magellan
Acquisition of Magellan | 6 Months Ended |
Mar. 31, 2016 | |
Business Combinations [Abstract] | |
Acquisition of Magellan | 3. Acquisition of Magellan On March 24, 2016, we acquired all of the outstanding common stock of Magellan Biosciences, Inc., and its wholly-owned subsidiary Magellan Diagnostics, Inc. (collectively, “Magellan”), for $67,800, utilizing the proceeds from a new $60,000 five-year term loan and cash and equivalents on hand. An amount of the acquisition consideration totaling $2,198 remains payable to the sellers, pending the realization of tax benefits for certain net operating loss carryforwards in future tax returns. Headquartered near Boston, Massachusetts, Magellan is a leading manufacturer of FDA-cleared products for the testing of blood to diagnose lead poisoning in children and adults. Magellan is the leading provider of point-of-care lead testing systems in the U.S. As a result of the consideration paid exceeding the preliminary fair value of the net assets acquired, goodwill in the amount of $42,730 was recorded in connection with this acquisition, none of which will be deductible for tax purposes. This goodwill results largely from the addition of Magellan’s complementary customer base and distribution channels, industry reputation in the U.S. as a leader in lead testing, and management talent and workforce. The recognized preliminary amounts of identifiable assets acquired and liabilities assumed in the acquisition of Magellan are as follows: PRELIMINARY Fair value of assets acquired - Cash and equivalents $ 3,420 Accounts receivable 1,700 Inventories 1,400 Other current assets 330 Property, plant and equipment 2,790 Goodwill 42,730 Other intangible assets (estimated useful life): Customer relationships (15 years) 12,630 Technology (10 years) 10,550 Non-compete agreements (2 years) 740 Trade names (approximate 5 year weighted average) 3,690 79,980 Fair value of liabilities assumed - Accounts payable and accrued expenses 1,610 Deferred income tax liabilities 10,570 Total consideration (including $2,198 accrued to be paid) $ 67,800 As indicated, the allocation of the purchase price and estimated useful lives of property, plant and equipment, and intangible assets shown above is preliminary, pending final completion of valuations. We are currently assessing the amount of tax net operating loss carryforwards available to us. Upon completion of this analysis, an amount will be reclassified from goodwill to deferred taxes. The consolidated pro forma results of the combined entities of Meridian and Magellan, had the acquisition date been October 1, 2014, are as follows for the periods indicated: Three Months Ended March 31, Six Months Ended March 31, 2016 2015 2016 2015 Net Revenues $ 54,961 $ 55,073 $ 106,057 $ 106,970 Net Earnings $ 9,658 $ 9,537 $ 18,211 $ 15,781 Diluted Earnings Per Common Share $ 0.23 $ 0.23 $ 0.43 $ 0.38 These pro forma amounts have been calculated by including the results of Magellan, and adjusting the combined results to reflect (i) the transaction costs incurred by the Company; (ii) the additional depreciation and amortization that would have been charged assuming the preliminary fair value adjustments to inventory ($154), property, plant and equipment ($550) and identifiable intangible assets ($27,610) had been applied on October 1, 2014; and (iii) the interest expense that would have been incurred on the Company’s $60,000 term note had the borrowing occurred on October 1, 2014 – together with the consequential tax effects. |
Cash and Equivalents
Cash and Equivalents | 6 Months Ended |
Mar. 31, 2016 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Equivalents | 4. Cash and Equivalents Cash and equivalents include the following components: March 31, 2016 September 30, 2015 Cash and Other Cash and Other Overnight repurchase agreements $ 21,727 $ — $ 25,436 $ — Cash on hand - Restricted — 1,000 — 1,000 Unrestricted 27,219 — 24,537 — Total $ 48,946 $ 1,000 $ 49,973 $ 1,000 |
Inventories
Inventories | 6 Months Ended |
Mar. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | 5. Inventories Inventories are comprised of the following: March 31, September 30, Raw materials $ 8,378 $ 7,095 Work-in-process 11,745 10,096 Finished goods - instruments 2,640 1,890 Finished goods - kits and reagents 19,171 16,736 Total $ 41,934 $ 35,817 |
Intangible Assets
Intangible Assets | 6 Months Ended |
Mar. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 6. Intangible Assets A summary of our acquired intangible assets subject to amortization, as of March 31, 2016 and September 30, 2015 is as follows: March 31, 2016 September 30, 2015 Gross Accumulated Gross Accumulated Manufacturing technologies, core products and cell lines $ 22,055 $ 11,012 $ 11,582 $ 10,906 Trademarks, licenses and patents 9,965 3,596 6,410 3,296 Customer lists and relationships, and supply agreements 24,531 10,081 12,105 9,964 Non-compete agreements 740 — — — $ 57,291 $ 24,689 $ 30,097 $ 24,166 The actual aggregate amortization expense for these intangible assets was $374 and $431 for the three months ended March 31, 2016 and 2015, respectively, and $762 and $900 for the six months ended March 31, 2016 and 2015, respectively. The estimated aggregate amortization expense for these intangible assets for each of the fiscal years through fiscal 2021 is as follows: remainder of fiscal 2016 – $2,106, fiscal 2017 – $4,075, fiscal 2018 – $3,869, fiscal 2019 – $3,644, fiscal 2020 – $3,474 and fiscal 2021 – $2,578. |
Bank Credit Arrangements
Bank Credit Arrangements | 6 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Bank Credit Arrangements | 7. Bank Credit Arrangements In connection with the acquisition of Magellan (see Note 3), on March 22, 2016 the Company entered into a $60,000 five-year term loan with a commercial bank. The term loan requires quarterly principal and interest payments, with interest at a variable rate tied to LIBOR and a balloon principal payment of $37,500 at the end of five years. Due to the recent execution date of the term loan and interest being determined on a variable rate basis, the fair value of the term loan at March 31, 2016 approximates the current carrying value reflected in the accompanying Condensed Consolidated Balance Sheet. In addition, the Company continues to maintain a $30,000 credit facility with the same commercial bank, which expires March 31, 2021. As there were no borrowings outstanding on this credit facility at March 31, 2016 or September 30, 2015, available borrowings as of both dates totaled $30,000. The term loan and the credit facility are collateralized by the business assets of the Company’s U.S. subsidiaries, and require compliance with financial covenants that limit the amount of debt obligations and require a minimum level of coverage of fixed charges, as defined in the borrowing agreement. We are in compliance with all covenants. In order to limit exposure to volatility in the LIBOR interest rate, the Company and the commercial bank also entered into an interest rate swap that effectively converts the variable interest rate on the term loan to a fixed rate. With an initial notional balance of $60,000, the interest rate swap has been established with critical terms identical to those of the term loan, including (i) notional reduction amounts and dates; (ii) LIBOR settlement rates; (iii) rate reset dates; and (iv) term/maturity. Due to this, the interest swap has been designated as an effective cash flow hedge, with changes in fair value reflected as a separate component of other comprehensive income in the accompanying Condensed Consolidated Statements of Comprehensive Income. At March 31, 2016, the fair value of the interest rate swap was $694, and is reflected as a non-current liability in the accompanying Condensed Consolidated Balance Sheet. This fair value was determined by reference to a market quote, and is considered a Level 2 input within the fair value hierarchy of valuation techniques. |
Reportable Segment and Major Cu
Reportable Segment and Major Customers Information | 6 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Reportable Segment and Major Customers Information | 8. 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 infectious disease (in vitro) and blood lead diagnostics and life science. Our principal businesses are (i) the development, manufacture and distribution of diagnostic test kits primarily for gastrointestinal, viral, respiratory, parasitic infectious diseases, and elevated blood lead levels; 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 for infectious disease products. The Diagnostics segment includes the Company’s recent acquisition of Magellan, which is located in Billerica, Massachusetts (near Boston). Its facility includes research, development, manufacturing, marketing, sales, and distribution operations. The Diagnostics segment has sales and distribution facilities for infectious disease diagnostics 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. Amounts due from two Diagnostics distributor customers accounted for 18% and 21% of consolidated accounts receivable at March 31, 2016 and September 30, 2015, respectively. Revenues from these two distributor customers accounted for 26% and 32% of the Diagnostics segment third-party revenues during the three months ended March 31, 2016 and 2015, respectively, and 33% and 36% during the six months ended March 31, 2016 and 2015, respectively. These distributors represented 19% and 24% of consolidated revenues for the fiscal 2016 and 2015 second quarters, respectively, and 24% and 27% for the respective year-to-date six month periods. Within our Life Science segment, two diagnostic manufacturing customers accounted for 18% and 16% of the segment’s third-party revenues during the three months ended March 31, 2016 and 2015, respectively, and 18% and 17% during the six months ended March 31, 2016 and 2015, respectively. Segment information for the interim periods is as follows: Diagnostics Life Science Eliminations(1) Total Three Months Ended March 31, 2016 Net revenues - Third-party $ 37,354 $ 13,905 $ — $ 51,259 Inter-segment 84 387 (471 ) — Operating income 11,196 4,154 (194 ) 15,156 Goodwill (March 31, 2016) 43,985 20,472 — 64,457 Other intangible assets, net (March 31, 2016) 29,694 2,908 — 32,602 Total assets (March 31, 2016) 190,447 68,349 (435 ) 258,361 Three Months Ended March 31, 2015 Net revenues - Third-party $ 38,662 $ 12,883 $ — $ 51,545 Inter-segment 85 225 (310 ) — Operating income 12,083 3,596 53 15,732 Goodwill (September 30, 2015) 1,250 21,099 — 22,349 Other intangible assets, net (September 30, 2015) 2,364 3,567 — 5,931 Total assets (September 30, 2015) 119,939 63,670 (327 ) 183,282 Six Months Ended March 31, 2016 Net revenues - Third-party $ 72,655 $ 25,764 $ — $ 98,419 Inter-segment 155 754 (909 ) — Operating income 21,526 7,390 (174 ) 28,742 Six Months Ended March 31, 2015 Net revenues - Third-party $ 75,248 $ 24,310 $ — $ 99,558 Inter-segment 189 522 (711 ) — Operating income 22,367 6,085 (51 ) 28,401 (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. |
Significant Accounting Polici16
Significant Accounting Policies (Policies) | 6 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | (a) Recent Accounting Pronouncements – In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers In November 2015, the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes In February 2016, the FASB issued ASU 2016-02, Leases In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting Issued but not yet effective accounting pronouncements are not expected to have a material impact on the Condensed Consolidated Financial Statements. |
Reclassifications | (b) Reclassifications – Certain reclassifications have been made to the prior period financial statements to conform to the current fiscal period presentation. Such reclassifications had no impact on net earnings or shareholders’ equity. |
Acquisition of Magellan (Tables
Acquisition of Magellan (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Business Combinations [Abstract] | |
Schedule of Preliminary Amounts of Identifiable Assets Acquired and Liabilities Assumed in Acquisition | The recognized preliminary amounts of identifiable assets acquired and liabilities assumed in the acquisition of Magellan are as follows: PRELIMINARY Fair value of assets acquired - Cash and equivalents $ 3,420 Accounts receivable 1,700 Inventories 1,400 Other current assets 330 Property, plant and equipment 2,790 Goodwill 42,730 Other intangible assets (estimated useful life): Customer relationships (15 years) 12,630 Technology (10 years) 10,550 Non-compete agreements (2 years) 740 Trade names (approximate 5 year weighted average) 3,690 79,980 Fair value of liabilities assumed - Accounts payable and accrued expenses 1,610 Deferred income tax liabilities 10,570 Total consideration (including $2,198 accrued to be paid) $ 67,800 |
Business Acquisition, Pro Forma Information | The consolidated pro forma results of the combined entities of Meridian and Magellan, had the acquisition date been October 1, 2014, are as follows for the periods indicated: Three Months Ended March 31, Six Months Ended March 31, 2016 2015 2016 2015 Net Revenues $ 54,961 $ 55,073 $ 106,057 $ 106,970 Net Earnings $ 9,658 $ 9,537 $ 18,211 $ 15,781 Diluted Earnings Per Common Share $ 0.23 $ 0.23 $ 0.43 $ 0.38 |
Cash and Equivalents (Tables)
Cash and Equivalents (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Cash and Cash Equivalents [Abstract] | |
Components of Cash and Cash Equivalents | Cash and equivalents include the following components: March 31, 2016 September 30, 2015 Cash and Other Cash and Other Overnight repurchase agreements $ 21,727 $ — $ 25,436 $ — Cash on hand - Restricted — 1,000 — 1,000 Unrestricted 27,219 — 24,537 — Total $ 48,946 $ 1,000 $ 49,973 $ 1,000 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Components of Inventories | Inventories are comprised of the following: March 31, September 30, Raw materials $ 8,378 $ 7,095 Work-in-process 11,745 10,096 Finished goods - instruments 2,640 1,890 Finished goods - kits and reagents 19,171 16,736 Total $ 41,934 $ 35,817 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
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 March 31, 2016 and September 30, 2015 is as follows: March 31, 2016 September 30, 2015 Gross Accumulated Gross Accumulated Manufacturing technologies, core products and cell lines $ 22,055 $ 11,012 $ 11,582 $ 10,906 Trademarks, licenses and patents 9,965 3,596 6,410 3,296 Customer lists and relationships, and supply agreements 24,531 10,081 12,105 9,964 Non-compete agreements 740 — — — $ 57,291 $ 24,689 $ 30,097 $ 24,166 |
Reportable Segment and Major 21
Reportable Segment and Major Customers Information (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment Information | Segment information for the interim periods is as follows: Diagnostics Life Science Eliminations(1) Total Three Months Ended March 31, 2016 Net revenues - Third-party $ 37,354 $ 13,905 $ — $ 51,259 Inter-segment 84 387 (471 ) — Operating income 11,196 4,154 (194 ) 15,156 Goodwill (March 31, 2016) 43,985 20,472 — 64,457 Other intangible assets, net (March 31, 2016) 29,694 2,908 — 32,602 Total assets (March 31, 2016) 190,447 68,349 (435 ) 258,361 Three Months Ended March 31, 2015 Net revenues - Third-party $ 38,662 $ 12,883 $ — $ 51,545 Inter-segment 85 225 (310 ) — Operating income 12,083 3,596 53 15,732 Goodwill (September 30, 2015) 1,250 21,099 — 22,349 Other intangible assets, net (September 30, 2015) 2,364 3,567 — 5,931 Total assets (September 30, 2015) 119,939 63,670 (327 ) 183,282 Six Months Ended March 31, 2016 Net revenues - Third-party $ 72,655 $ 25,764 $ — $ 98,419 Inter-segment 155 754 (909 ) — Operating income 21,526 7,390 (174 ) 28,742 Six Months Ended March 31, 2015 Net revenues - Third-party $ 75,248 $ 24,310 $ — $ 99,558 Inter-segment 189 522 (711 ) — Operating income 22,367 6,085 (51 ) 28,401 (1) Eliminations consist of inter-segment transactions. |
Significant Accounting Polici22
Significant Accounting Policies - Additional Information (Detail) $ in Thousands | Sep. 30, 2015USD ($) |
Schedule Of Accounting Policies [Line Items] | |
Deferred income taxes | $ 4,954 |
ASU 2015-17 [Member] | |
Schedule Of Accounting Policies [Line Items] | |
Deferred income taxes | $ 3,431 |
Acquisition of Magellan - Addit
Acquisition of Magellan - Additional Information (Detail) - USD ($) $ in Thousands | Mar. 24, 2016 | Oct. 01, 2014 | Mar. 31, 2016 | Mar. 31, 2016 | Mar. 22, 2016 | Sep. 30, 2015 |
Business Acquisition [Line Items] | ||||||
Proceeds from term loan | $ 59,842 | |||||
Acquisition consideration payable | $ 2,198 | 2,198 | ||||
Goodwill | 64,457 | 64,457 | $ 22,349 | |||
Transaction cost | 1,202 | 1,481 | ||||
Inventory [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Fair value adjustments | $ 154 | |||||
Property, Plant and Equipment [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Fair value adjustments | 550 | |||||
Intangible Assets [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Fair value adjustments | 27,610 | |||||
Magellan [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Total consideration paid | $ 67,800 | |||||
Acquisition consideration payable | 2,198 | |||||
Goodwill | 42,730 | |||||
Transaction cost | $ 1,173 | $ 1,173 | ||||
Term loan | $ 60,000 | |||||
Magellan [Member] | Five - Year Term Loan [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Proceeds from term loan | $ 60,000 | |||||
Term loan | $ 60,000 |
Acquisition of Magellan - Sched
Acquisition of Magellan - Schedule of Preliminary Amounts of Identifiable Assets Acquired and Liabilities Assumed in Acquisition (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Mar. 24, 2016 | Sep. 30, 2015 |
Fair value of assets acquired - | |||
Goodwill | $ 64,457 | $ 22,349 | |
Magellan [Member] | |||
Fair value of assets acquired - | |||
Cash and equivalents | $ 3,420 | ||
Accounts receivable | 1,700 | ||
Inventories | 1,400 | ||
Other current assets | 330 | ||
Property, plant and equipment | 2,790 | ||
Goodwill | 42,730 | ||
Other intangible assets: | |||
Fair value of assets acquired net | 79,980 | ||
Fair value of liabilities assumed - | |||
Accounts payable and accrued expenses | 1,610 | ||
Deferred income tax liabilities | 10,570 | ||
Total consideration | 67,800 | ||
Magellan [Member] | Customer Relationships [Member] | |||
Other intangible assets: | |||
Other intangible assets | 12,630 | ||
Magellan [Member] | Technology [Member] | |||
Other intangible assets: | |||
Other intangible assets | 10,550 | ||
Magellan [Member] | Non-Compete Agreements [Member] | |||
Other intangible assets: | |||
Other intangible assets | 740 | ||
Magellan [Member] | Trade Names [Member] | |||
Other intangible assets: | |||
Other intangible assets | $ 3,690 |
Acquisition of Magellan - Sch25
Acquisition of Magellan - Schedule of Preliminary Amounts of Identifiable Assets Acquired and Liabilities Assumed in Acquisition (Parenthetical) (Detail) - USD ($) $ in Thousands | Mar. 24, 2016 | Mar. 31, 2016 |
Business Acquisition [Line Items] | ||
Acquisition consideration payable | $ 2,198 | |
Magellan [Member] | ||
Business Acquisition [Line Items] | ||
Acquisition consideration payable | $ 2,198 | |
Customer Relationships [Member] | Magellan [Member] | ||
Business Acquisition [Line Items] | ||
Estimated useful life | 15 years | |
Technology [Member] | Magellan [Member] | ||
Business Acquisition [Line Items] | ||
Estimated useful life | 10 years | |
Non-Compete Agreements [Member] | Magellan [Member] | ||
Business Acquisition [Line Items] | ||
Estimated useful life | 2 years | |
Trade Names [Member] | Magellan [Member] | ||
Business Acquisition [Line Items] | ||
Estimated weighted average useful life | 5 years |
Acquisition of Magellan - Busin
Acquisition of Magellan - Business Acquisition, Pro Forma Information (Detail) - Magellan [Member] - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Business Acquisition [Line Items] | ||||
Net Revenues | $ 54,961 | $ 55,073 | $ 106,057 | $ 106,970 |
Net Earnings | $ 9,658 | $ 9,537 | $ 18,211 | $ 15,781 |
Diluted Earnings Per Common Share | $ 0.23 | $ 0.23 | $ 0.43 | $ 0.38 |
Cash and Equivalents - Componen
Cash and Equivalents - Components of Cash and Cash Equivalents (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Sep. 30, 2015 | Mar. 31, 2015 | Oct. 01, 2014 |
Cash and Cash Equivalents [Line Items] | ||||
Cash on hand - Restricted | $ 1,000 | $ 1,000 | ||
Total | 48,946 | 49,973 | $ 42,719 | $ 43,047 |
Cash and Equivalents [Member] | ||||
Cash and Cash Equivalents [Line Items] | ||||
Overnight repurchase agreements | 21,727 | 25,436 | ||
Cash on hand - Unrestricted | 27,219 | 24,537 | ||
Total | 48,946 | 49,973 | ||
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 | Mar. 31, 2016 | Sep. 30, 2015 |
Inventory [Line Items] | ||
Raw materials | $ 8,378 | $ 7,095 |
Work-in-process | 11,745 | 10,096 |
Total | 41,934 | 35,817 |
Instruments [Member] | ||
Inventory [Line Items] | ||
Finished goods | 2,640 | 1,890 |
Kits and Reagents [Member] | ||
Inventory [Line Items] | ||
Finished goods | $ 19,171 | $ 16,736 |
Intangible Assets - Summary of
Intangible Assets - Summary of Acquired Intangible Assets Subject to Amortization (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Sep. 30, 2015 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 57,291 | $ 30,097 |
Accumulated Amortization | 24,689 | 24,166 |
Manufacturing Technologies, Core Products and Cell Lines [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 22,055 | 11,582 |
Accumulated Amortization | 11,012 | 10,906 |
Trademarks, Licenses and Patents [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 9,965 | 6,410 |
Accumulated Amortization | 3,596 | 3,296 |
Customer Lists and Relationships, and Supply Agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 24,531 | 12,105 |
Accumulated Amortization | 10,081 | $ 9,964 |
Non-Compete Agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 740 |
Intangible Assets - Additional
Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of intangible assets | $ 374 | $ 431 | $ 762 | $ 900 |
Estimated amortization expense for intangible assets remainder of fiscal year 2016 | 2,106 | 2,106 | ||
2,017 | 4,075 | 4,075 | ||
2,018 | 3,869 | 3,869 | ||
2,019 | 3,644 | 3,644 | ||
2,020 | 3,474 | 3,474 | ||
2,021 | $ 2,578 | $ 2,578 |
Bank Credit Arrangements - Addi
Bank Credit Arrangements - Additional Information (Detail) - USD ($) $ in Thousands | 6 Months Ended | |||
Mar. 31, 2016 | Mar. 22, 2016 | Sep. 30, 2015 | Oct. 01, 2014 | |
Debt Instrument [Line Items] | ||||
Credit facility with a commercial bank | $ 30,000 | |||
Expiration date of credit facility | Mar. 31, 2021 | |||
Borrowings outstanding under credit facility | $ 0 | $ 0 | ||
Available borrowings under credit facility | 30,000 | $ 30,000 | ||
Notional balance | $ 60,000 | |||
Interest rate swap description | (i) notional reduction amounts and dates; (ii) LIBOR settlement rates; (iii) rate reset dates; and (iv) term/maturity. | |||
Interest rate swap fair value | $ 694 | |||
Magellan [Member] | ||||
Debt Instrument [Line Items] | ||||
Term loan | $ 60,000 | |||
Five - Year Term Loan [Member] | Magellan [Member] | ||||
Debt Instrument [Line Items] | ||||
Term loan | $ 60,000 | |||
Balloon principal payment | $ 37,500 | |||
Balloon principal payment repayment period | 5 years |
Reportable Segment and Major 32
Reportable Segment and Major Customers Information - Additional Information (Detail) - Customer Concentration Risk [Member] - Customer | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Sep. 30, 2015 | |
Two Diagnostic Distributor Customers [Member] | Consolidated Accounts Receivable [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Number of major customers | 2 | 2 | |||
Concentration risk percentage | 18.00% | 21.00% | |||
Two Diagnostic Distributor Customers [Member] | Segment, Third-Party Sales Revenue [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Number of major customers | 2 | 2 | 2 | 2 | |
Two Diagnostic Distributor Customers [Member] | Segment, Third-Party Sales Revenue [Member] | Diagnostics [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Concentration risk percentage | 26.00% | 32.00% | 33.00% | 36.00% | |
Two Diagnostic Distributor Customers [Member] | Revenues [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Concentration risk percentage | 19.00% | 24.00% | 24.00% | 27.00% | |
Two Diagnostic Manufacturing Customers [Member] | Segment, Third-Party Sales Revenue [Member] | Life Science [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Number of major customers | 2 | 2 | 2 | 2 | |
Concentration risk percentage | 18.00% | 16.00% | 18.00% | 17.00% |
Reportable Segment and Major 33
Reportable Segment and Major Customers Information - Segment Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Sep. 30, 2015 | |
Segment Reporting Information [Line Items] | |||||
NET REVENUES | $ 51,259 | $ 51,545 | $ 98,419 | $ 99,558 | |
Operating income | 15,156 | 15,732 | 28,742 | 28,401 | |
Goodwill | 64,457 | 64,457 | $ 22,349 | ||
Other intangible assets, net | 32,602 | 32,602 | 5,931 | ||
Total assets | 258,361 | 258,361 | 183,282 | ||
Inter-segment [Member] | Diagnostics [Member] | |||||
Segment Reporting Information [Line Items] | |||||
NET REVENUES | 84 | 85 | 155 | 189 | |
Inter-segment [Member] | Life Science [Member] | |||||
Segment Reporting Information [Line Items] | |||||
NET REVENUES | 387 | 225 | 754 | 522 | |
Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
NET REVENUES | (471) | (310) | (909) | (711) | |
Operating income | (194) | 53 | (174) | (51) | |
Total assets | (435) | (435) | (327) | ||
Operating Segments [Member] | Diagnostics [Member] | |||||
Segment Reporting Information [Line Items] | |||||
NET REVENUES | 37,354 | 38,662 | 72,655 | 75,248 | |
Operating income | 11,196 | 12,083 | 21,526 | 22,367 | |
Goodwill | 43,985 | 43,985 | 1,250 | ||
Other intangible assets, net | 29,694 | 29,694 | 2,364 | ||
Total assets | 190,447 | 190,447 | 119,939 | ||
Operating Segments [Member] | Life Science [Member] | |||||
Segment Reporting Information [Line Items] | |||||
NET REVENUES | 13,905 | 12,883 | 25,764 | 24,310 | |
Operating income | 4,154 | $ 3,596 | 7,390 | $ 6,085 | |
Goodwill | 20,472 | 20,472 | 21,099 | ||
Other intangible assets, net | 2,908 | 2,908 | 3,567 | ||
Total assets | $ 68,349 | $ 68,349 | $ 63,670 |