FOR IMMEDIATE RELEASE
Bio-Rad Laboratories Reports Second-Quarter Financial Results
HERCULES, CA - August 5, 2004 - Bio-Rad Laboratories, Inc. (AMEX:
BIO and BIOb), a multinational manufacturer and distributor of life
science research products and clinical diagnostics, announced
financial results today for the second quarter ended June 30, 2004.
Second quarter net sales from continuing operations were $260.5
million, up 8.9 percent compared to the $239.3 million reported for
the same quarter of 2003. This increase was primarily the result
of organic growth in the Company's main business segments as well
as currency effects. For the quarter, income from continuing
operations was $20.3 million compared to $21.9 million in the
second quarter of last year.
In May, the Company sold its U.K. based confocal microscopy product
line to Carl Zeiss Jena GMBH. As required by SFAS 144, the sales
and expenses related to this product line for current and prior
periods have been reclassified to a separate line on the income
statement titled "Discontinued operations."
Net sales for the first half of 2004 grew by 9.1 percent to $523.3
million compared to the same period last year. At 57.1 percent,
gross margin for the first half of 2004 was down slightly compared
to 57.5 percent in the same period of 2003. However, at 57.4
percent, second-quarter gross margin was markedly higher than the
56.4 percent reported for the second quarter of 2003. This
improvement was a result of the Company's product mix skewing
toward consumables as well as the elimination of some low margin
products. Income from continuing operations for the six-month
period was $42.9 million, or $1.67 per share, an 11.8 percent
decrease compared to the $48.6 million, or $1.92 per share,
reported in the corresponding period of last year. This reduction
was largely due to anticipated spending on infrastructure
improvements.
Second Quarter Highlights
- Overall net sales for the second quarter grew by 8.9 percent
to reach $260.5 million compared to $239.3 million reported in the
second quarter of 2003. On a currency-neutral basis, revenues were
up 4.2 percent versus second-quarter 2003 results.
- Basic earnings from continuing operations were $0.79 per
share, or $0.76 per share on a diluted basis, compared to basic
earnings per share of $0.86 and diluted earnings per share of $0.83
in the same period of 2003.
- Life Science segment net sales for the quarter were $113.9
million, 3.4 percent higher than the comparable period last year.
On a currency neutral basis, segment sales declined by 1.3 percent
for the quarter. Overall performance in the Life Science segment
was negatively impacted by increased competition in certain
instrumentation businesses and the timing of shipments in the
process chromatography business. Solid performers in this segment
included the multiplex protein array technology, amplification
reagents, and electrophoresis product lines.
(more)
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Bio-Rad Reports Second Quarter 2004
Page 2
- The Clinical Diagnostics segment reported net sales of $144.4
million for the quarter, up 13.4 percent compared to the second
quarter of 2003, or 8.8 percent excluding currency effects. These
results were the result of growth in several areas including
autoimmune testing, quality-control management and diabetes
monitoring, as well as the addition of acquired Hematronix products
to the quality controls portfolio. Moreover, sales of Bio-Rad's
Platelia(TM) Aspergillus EIA test kit in the United States and Canada
gained momentum, in part due to the Company's co-marketing
agreement with Enzon Pharmaceuticals, Inc.
- During the quarter, the Company granted a worldwide, non-
exclusive sublicense to OraSure Technologies, Inc. under patents
relating to the Human Immunodeficiency Virus, Type 2, or HIV-2.
"While our life science market is experiencing modest growth to
date, we are anticipating the introduction of several very
interesting new products in the coming months," said Norman
Schwartz, President and Chief Executive Officer. "This, coupled
with the recent introduction of the Bio-Plex(TM) 2200 to the
diagnostic market, should provide good momentum during the second
half of the year."
Management will discuss these results in a conference call at 2:00
p.m. PT (5:00 p.m. ET) August 5, 2004. Interested parties can
access the call by dialing (800) 901-5218 (in the U.S.), or (617)
786-4511 (international), access number 89936051. The live web
cast can be accessed at http://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), access number 73327988, for seven days
following the call and the web cast can be accessed at
http://www.bio-rad.com for 30 days.
Bio-Rad Laboratories, Inc. is a multinational manufacturer and
distributor of life science research products and clinical
diagnostics. It is based in Hercules, California, and serves more
than 70,000 research and industry customers worldwide through a
network of more than 30 wholly owned subsidiary offices.
Various statements made within this press release may constitute
"forward-looking statements" for purposes of the Securities and
Exchange Commission's "safe harbor" provisions under the Private
Securities Litigation Reform Act of 1995 and Rule 3b-6 under the
Securities Exchange Act of 1934. The forward-looking statements
contained herein involve risks and uncertainties that could cause
results to differ materially from the Company's expectations.
For more information contact:
Christine Tsingos, Vice President and Chief Financial Officer, or
Ron Hutton, Treasurer
Bio-Rad Laboratories, Inc.
Phone: (510) 724-7000
E-mail: investor_relations@bio-rad.com
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Bio-Rad Laboratories, Inc.
Second Quarter 2004
Condensed Consolidated Statements of Income
(In thousands, except per share data)
(UNAUDITED)
Three Months Ended Six Months Ended
June 30, June 30,
2004 2003 2004 2003
-------- -------- -------- --------
Net sales $260,546 $239,325 $523,295 $479,723
Cost of goods sold 110,885 104,265 224,370 203,985
-------- -------- -------- --------
Gross profit 149,661 135,060 298,925 275,738
Selling, general and
administrative expense 90,199 76,947 177,256 152,269
Product research and
development expense 25,545 21,990 49,878 42,601
Purchased in-process research
and development expense - - 900 -
Interest expense 4,919 3,696 9,969 8,347
Foreign exchange losses, net 545 554 747 1,323
Other (income) expense, net (866) (880) (650) (1,484)
-------- -------- -------- --------
Income from continuing
operations before taxes 29,319 32,753 60,825 72,682
Provision for income taxes (9,048) (10,834) (17,934) (24,050)
-------- -------- -------- --------
Income from continuing operations 20,271 21,919 42,891 48,632
-------- -------- -------- --------
Discontinued operations
Discontinued operations (net of tax) (845) (963) (1,487) (1,312)
Gain on divestiture (net of tax) 3,437 - 3,437 -
-------- -------- -------- --------
Total discontinued operations 2,592 (963) 1,950 (1,312)
-------- -------- -------- --------
Net income $ 22,863 $ 20,956 $ 44,841 $ 47,320
======== ======== ======== ========
Basic earnings per share
Continuing operations $ 0.79 $ 0.86 $ 1.67 $ 1.92
Discontinued operations 0.10 (0.03) 0.08 (0.05)
-------- -------- -------- --------
Net income $0.89 $0.83 $ 1.75 $ 1.87
======== ======== ======== ========
Weighted average common shares 25,699 25,386 25,662 25,336
======== ======== ======== ========
Diluted earnings per share
Continuing operations $ 0.76 $ 0.83 $ 1.62 $ 1.86
Discontinued operations 0.10 (0.03) 0.07 (0.05)
-------- -------- -------- --------
Net income $ 0.86 $ 0.80 $ 1.69 $ 1.81
======== ======== ======== ========
Adjusted weighted average shares 26,504 26,341 26,474 26,214
======== ======== ======== ========
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Bio-Rad Laboratories, Inc.
Summary Condensed Consolidated Balance Sheets
(In thousands)
(UNAUDITED)
At June 30, At December 31,
2004 2003
--------- ---------
Current assets:
Cash and cash equivalents $ 155,329 $ 148,642
Accounts receivable, net 234,003 234,085
Inventories, net 188,564 190,258
Prepaid expenses, taxes and other current assets 82,491 97,893
--------- ---------
Total current assets 660,387 670,878
Net property, plant and equipment 186,233 179,123
Goodwill, net 72,741 69,503
Other assets 103,399 67,354
--------- ---------
Total assets $1,022,760 $ 986,858
========= =========
Current liabilities:
Notes payable and current maturities
of long-term debt $ 9,987 $ 10,423
Accounts payable 67,340 53,995
Accrued payroll and employee benefits 59,464 71,650
Sales, income and other taxes payable 12,634 20,833
Other current liabilities 61,712 77,425
--------- ---------
Total current liabilities 211,137 234,326
Long-term debt, net of current maturities 226,098 225,835
Deferred tax liabilities 15,962 13,991
Other long-term liabilities 25,043 16,899
Stockholders' equity 544,520 495,807
--------- ---------
Total liabilities and stockholders' equity $1,022,760 $ 986,858
========= =========
Certain items have been reclassified to conform to the current
year presentation.
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Bio-Rad Laboratories, Inc.
Summary Condensed Consolidated Statement of Cash Flows
(In thousands)
(UNAUDITED)
Period Ended June 30,
2004 2003
--------- ---------
Cash flows from operating activities:
Cash received from customers $ 517,385 $ 499,425
Cash paid to suppliers and employees (440,664) (409,833)
Interest paid (9,866) (9,164)
Income tax payments (20,860) (31,632)
Miscellaneous receipts (payments) 3,568 (149)
Discontinued operations (2,019) (2,055)
--------- ---------
Net cash provided by operating activities 47,544 46,592
Cash flows from investing activities:
Capital expenditures, net (29,057) (25,368)
Other investing activities (16,378) (14,908)
--------- ---------
Net cash used in investing activities (45,435) (40,276)
Cash flows from financing activities:
Long-term borrowings 0 10,835
Payments on long-term debt (212) (18,109)
Other financing activities 3,465 6,002
--------- ---------
Net cash provided by (used in)
financing activities 3,253 (1,272)
Effect of exchange rate changes on cash 1,325 (3,949)
--------- ---------
Net increase in cash and cash equivalents 6,687 1,095
Cash and cash equivalents at beginning of period 148,642 27,733
========= =========
Cash and cash equivalents at end of period $ 155,329 $ 28,828
Reconciliation of income from continuing operations
to net cash provided by operating activities:
Income from continuing operations $ 42,891 $ 48,632
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 22,881 20,495
Changes in working capital (19,540) (37,131)
Other 2,799 15,908
Discontinued operations (1,487) (1,312)
--------- ---------
Net cash provided by operating activities $ 47,544 $ 46,592
========= =========
Certain items have been reclassified to conform to
the current year presentation.
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