UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
CITYPLACEWASHINGTON, STATED.C. POSTALCODE20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended July 1, 2006
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 0-6994
StateplaceNEW BRUNSWICK SCIENTIFIC CO., INC.
--------------------------------------------
(Exact name of registrant as specified in its charter)
New Jersey 22-1630072
--------------------- -----------
(State or other jurisdiction of I.R.S.
incorporation or organization) Employer Identification No.)
44 Talmadge Road
Edison, StateNew Jersey 08817
- ------------------------- -----
(Address of principal executive offices) (Zip Code)
(732) 287-1200
---------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding twelve (12) months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past ninety (90) days. Yes [X] No [ ]
Indicate by checkmark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange act. (Check
one):
Large accelerated filer [ ]
Accelerated filer [ ]
Non-accelerated filer [X]
Indicate by checkmark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]
There are 9,204,406 Common shares outstanding as of July 20, 2006.
1
NEW BRUNSWICK SCIENTIFIC CO., INC.
Index
PART I - FINANCIAL STATEMENTS
Item 1. Financial Statements (unaudited)
Consolidated Balance Sheets - July 1, 2006 and December 31, 2005 3
Consolidated Statements of Operations - Three and Six Months Ended
July 1, 2006 and July 2, 2005 4
Consolidated Statements of Cash Flows -
Six Months Ended July 1, 2006 and July 2, 2005 5
Consolidated Statements of Comprehensive Income (Loss) -
Three and Six Months Ended July 1, 2006 and July 2, 2005 7
Notes to Unaudited Consolidated Financial Statements 8
Item 2. Management's Discussion and Analysis of Results
of Operations and Financial Condition 15
Item 3. Qualitative and Quantitative Disclosures about Market Risk 23
Item 4. Controls and Procedures 23
PART II
Item 1. Legal Proceedings 24
Item 1A. Risk Factors 24
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 24
Item 4. Submission of Matters to a Vote of Security Holders 25
Item 6. Exhibits 25
Signatures 27
FORWARD-LOOKING STATEMENTS
This document contains "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking statements
may be identified by words such as "expects," "anticipates," "intends," "plans,"
"believes," "seeks," "estimates," "will" or words of similar meaning and
include, but are not limited to, statements about the expected future business
and financial performance of New Brunswick Scientific Co., Inc. and its
subsidiaries. The forward-looking statements include a number of risks and
uncertainties which are detailed in Part I, Item 1A, "Risk Factors,", of our
Annual Report on Form 10-K for the year ended December 31, 2005 and other risk
factors identified herein or from time to time in our periodic filings with the
Securities and Exchange Commission. Forward-looking statements are based on
management's current expectations and assumptions, which are inherently subject
to uncertainties, risks and changes in circumstances that are difficult to
predict. Actual outcomes and results may differ materially from these
expectations and assumptions due to changes in global political, economic,
business, competitive, market, regulatory and other factors. We undertakes no
obligation to publicly update or review any forward-looking information, whether
as a result of new information, future developments or otherwise. Unless the
context requires otherwise, references in this quarterly report on Form 10-Q to
"Company", "we," "us," and "our" refer to placeStateNew Brunswick Scientific
Co., Inc. and its subsidiaries.
See notes to unaudited consolidated financial statements.
2
PART I - FINANCIAL STATEMENTS.
NEW BRUNSWICK SCIENTIFIC CO., INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share amounts)
(Unaudited)
ASSETS
------
July 1, December 31,
2006 2005
--------- --------------
Current assets:
Cash and cash equivalents $ 7,847 $ 11,351
Accounts receivable, net 12,589 11,989
Inventories:
Raw materials and sub-assemblies 8,571 7,123
Work-in-process 2,073 2,120
Finished goods 4,714 3,912
--------- --------------
Total inventories 15,358 13,155
Deferred income taxes 543 543
Prepaid expenses and other current assets 1,129 1,211
--------- --------------
Total current assets 37,466 38,249
--------- --------------
Property, plant and equipment, net 8,185 6,595
Goodwill 8,453 7,864
Deferred income taxes 326 326
Other assets 1,972 1,932
--------- --------------
Total assets $ 56,402 $ 54,966
========= ==============
LIABILITIES AND SHAREHOLDERS' EQUITY
- -------------------------------------
Current liabilities:
Current installments of long-term debt $ 4,459 $ 4,597
Accounts payable and accrued expenses 8,294 10,782
--------- --------------
Total current liabilities 12,753 15,379
--------- --------------
Long-term debt, net of current installments 1,182 1,389
Other liabilities 1,297 1,480
--------- --------------
Total liabilities 15,232 18,248
Commitments and contingencies
Shareholders' equity:
Common stock, $0.0625 par; authorized 25,000,000 shares; issued and outstanding:
2006 - 9,195,351 shares; 2005 - 9,006,922 shares 575 563
Additional paid-in capital 54,626 53,423
Accumulated deficit (13,169) (14,769)
Accumulated other comprehensive loss (852) (2,489)
Notes receivable from exercise of stock options (10) (10)
--------- --------------
Total shareholders' equity 41,170 36,718
--------- --------------
Total liabilities and shareholders' equity $ 56,402 $ $54,966
========= ==============
3
NEW BRUNSWICK SCIENTIFIC CO., INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
July 1, July 2, July 1, July 2,
2006 2005 2006 2005
-------------------- ------------------ --------- ---------
Net sales $ 18,586 $ 15,180 $ 35,553 $ 31,288
Operating costs and expenses:
Cost of sales 10,922 9,267 20,982 19,073
Selling, general and administrative expenses 4,918 4,601 9,544 9,123
Research, development and engineering expenses 1,147 1,239 2,433 2,376
-------------------- ------------------ --------- ---------
Total operating costs and expenses 16,987 15,107 32,959 30,572
-------------------- ------------------ --------- ---------
Income from operations 1,599 73 2,594 716
Other income (expense):
Interest income 86 58 174 111
Interest expense (77) (145) (167) (181)
Other, net (35) 2 (65) 21
-------------------- ------------------ --------- ---------
(26) (85) (58) (49)
-------------------- ------------------ --------- ---------
Income (loss) before income tax expense (benefit) 1,573 (12) 2,536 667
Income tax expense (benefit) 556 (16) 936 256
-------------------- ------------------ --------- ---------
Net income $ 1,017 $ 4 $ 1,600 $ 411
==================== ================== ========= =========
Basic income per share $ 0.11 $ 0.00 $ 0.18 $ 0.05
==================== ================== ========= =========
Diluted income per share $ 0.11 $ 0.00 $ 0.17 $ 0.05
==================== ================== ========= =========
Basic weighted average number of shares
outstanding 9,175 8,951 9,111 8,922
==================== ================== ========= =========
Diluted weighted average number of shares
outstanding 9,232 9,002 9,172 8,988
==================== ================== ========= =========
4
NEW BRUNSWICK SCIENTIFIC CO., INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Six Months Ended
July 1, July 2,
2006 2005
------------------ ---------
Cash flows from operating activities:
Net income $ 1,600 $ 411
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 631 628
Share-based compensation 148 -
Deferred income taxes - 51
Change in fair value of interest rate swaps (59) (116)
Change in related balance sheet accounts:
Accounts and notes receivable (66) 1,724
Inventories (1,839) (1,886)
Prepaid expenses and other current assets 149 (339)
Other assets 326 (295)
Accounts payable and accrued expenses (2,895) (396)
Advance payments from customers 19 254
Other liabilities (176) (285)
------------------ ---------
Net cash used in operating activities (2,162) (249)
------------------ ---------
Cash flows used in investing activities:
Additions to property, plant and equipment (2,236) (318)
Proceeds from sale of equipment 136 -
------------------ ---------
Net cash used in investing activities (2,100) (318)
------------------ ---------
Cash flows from financing activities:
Tax benefits from exercised stock options 287 -
Repayments of long-term debt (386) (336)
Proceeds from issue of shares under stock purchase and option plans 771 444
Payments on notes receivable related to exercised stock options - 11
------------------ ---------
Net cash provided by financing activities 672 119
------------------ ---------
Net effect of exchange rate changes on cash 86 (51)
------------------ ---------
Net decrease in cash and cash equivalents (3,504) (499)
Cash and cash equivalents at beginning of period 11,351 10,846
------------------ ---------
Cash and cash equivalents at end of period $ 7,847 $ 10,347
================== =========
5
NEW BRUNSWICK SCIENTIFIC CO., INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
(In thousands)
(Unaudited)
Six Months Ended
July 1, July 2,
2006 2005
----------------- --------
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest $ 278 $ 285
Income taxes $ 666 $ 731
Supplemental Schedule of Non-Cash Financing Activates:
During the six months ended July 1, 2006, we retired
40,015 shares of Common Stock that were tendered to us upon the exercise of
certain employee stock options. The market price of these shares, at the time
of tender, aggregated $319,000.
6
NEW BRUNSWICK SCIENTIFIC CO., INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(In thousands)
(Unaudited)
Three Months Ended Six Months Ended
------------------- ------------------
July 1, July 2, July 1, July 2,
2006 2005 2006 2005
------------------- ------------------ -------- ---------
Net income $ 1,017 $ 4 $ 1,600 $ 411
Other comprehensive income (loss):
Foreign currency translation adjustment 993 (1,125) 1,630 (1,686)
Change in fair value of interest rate swaps 1 (1) 7 (1)
------------------- ------------------ -------- ---------
Comprehensive income (loss) $ 2,011 $ (1,122) $ 3,237 $ (1,276)
=================== ================== ======== =========
7
NEW BRUNSWICK SCIENTIFIC CO., INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
Note 1 - Interim results:
In the opinion of management, the accompanying unaudited consolidated financial
statements contain all adjustments (consisting only of normal recurring
adjustments) necessary to present fairly, the financial position of the Company
as of July 1, 2006 and the results of its operations for the three and six
months ended July 1, 2006 and July 2, 2005 and its cash flows for the six months
ended July 1, 2006 and July 2, 2005. Interim results may not be indicative of
the results that may be expected for the year.
The accompanying unaudited consolidated financial statements should be read in
conjunction with the consolidated financial statements and notes thereto
included in our annual report on Form 10-K for the year ended
December 31, 2005.
Note 2 - Interest rate swaps:
We account for our derivative and hedging transactions in accordance with SFAS
No. 133, "Accounting for Derivative Instruments and Certain Hedging Activities"
and SFAS No. 138, "Accounting for Certain Derivative Instruments and Certain
Hedging Activities". SFAS No. 133 and SFAS No. 138 require that all derivative
instruments be recorded on the balance sheet at their respective fair values.
On April 1, 2005 we put in place the required
documentation as prescribed by SFAS No. 133 and designated three interest rate
swaps as cash flow hedges and will therefore avail ourselves to the hedge
accounting rules for the remainder of the lives of the swaps. As such, the
negative fair values of the swaps as of the designation date, which aggregated
$146,000, will ultimately be recognized into income over the remaining lives of
the interest rate swaps as ineffectiveness. Since April 1,
2005, hedge ineffectiveness measured each quarter will be recognized in
operations. The effective changes in the fair value of the swaps subsequent to
April 1, 2005 are shown as an increase or decrease in
other comprehensive income on our balance sheet in accordance with the
requirements of SFAS No. 133.
At July 1, 2006 the remaining fair values of the swaps
aggregated $23,000. During the three and six months ended July 1, 2006 and July
2, 2005, the change in the fair value of the swap agreements recorded as a
decrease to interest expense amounted to $28,000 and $52,000, respectively, for
the 2006 periods and zero and $117,000, respectively, for the 2005 periods.
Note 3 - Income per share:
Basic income per share is calculated by dividing net income by the weighted
average number of shares outstanding. Diluted income per share is calculated by
dividing net income by the sum of the weighted average number of shares
8
outstanding plus the dilutive effect of stock options which have been issued by
us using the treasury stock method. Antidilutive stock options are excluded
from the calculation of diluted income per share. For the three and six month
periods ended July 1, 2006 there were no stock options
that were antidilutive. For the three and six months ended July 2, 2005 stock
options to purchase 153,700 and 151,500 shares, respectively, were excluded from
the calculation of diluted income per share since their inclusion would have
been antidilutive. The dilutive effect of stock options for the three and six
month periods ended July 1, 2006 and July 2, 2005 are 57,185 and 60,995,
respectively, for the 2006 periods and 50,668 and 66,115, respectively, for the
2005 periods.
Note 4 - Long-term debt and credit agreement:
We are parties to an agreement with Wachovia Bank, National Association (the
"Bank"), which has had a number of amendments (the "Bank Agreement"), which has
been extended to May 31, 2008, and which provides us with a credit facility for
acquisitions, equipment loans, working capital and letters of credit and foreign
exchange transactions. The maturity of the outstanding debt incurred related to
the acquisition portion of the credit facility with respect to a 1999
acquisition is December 1, 2006, and with respect to a
2003 acquisition is November 1, 2008. The maturity date
of the outstanding debt incurred related to the equipment loan portion of the
credit facility is November 1, 2008. There are no
compensating balance requirements and any borrowings under the Bank Agreement
bear interest at the Bank's prime rate less 125 basis points or LIBOR plus 125
basis points, at our discretion. At July 1, 2006, the
Bank's prime rate was 8.25% and LIBOR was 5.33%.
All of our domestic assets, which are not otherwise subject to lien, have been
pledged as security for any borrowings under the Bank Agreement. The Bank
Agreement contains various business and financial covenants including among
other things, a debt service ratio, a net worth covenant and a ratio of total
liabilities to tangible net worth. We are in compliance with our covenants
pursuant to the Bank Agreement at July 1, 2006.
9
The following amounts were outstanding and available under the Bank Agreement
(in thousands):
July1, 2006 December 31, 2005
---------------------------------------------- -----------------
Total
Line Available Outstanding
---------------------------------- ---------- -------------------
Acquisitions $ 10,000 $ 5,127 $ 4,873(a) $ 5,133(a(
Equipment loans 2,500 2,101 399(b) 481(b)
Working capital and letters of credit 5,000 4,971 29(c) 29(c)
Foreign exchange transactions 10,000 10,000 - -
---------------------------------- ---------- -------------------
$ 27,500 $ 22,199 $ 5,301
================================== ========== ====================
<FN>
_____________________
(a) $3,927,000 in 2006 and $4,079,000 in 2005 at fixed interest of 8% per annum and $946,000 in 2006 and $1,054,000 in 2005 at
fixed interest of 4.46% per annum through the use of interest rate swap agreements.
(b) Interest fixed at 4.14% per annum through the use of an interest rate swap agreement.
(c) Letters of credit.
At July 1, 2006 and December 31,
2005, the interest rate swaps referred to above had aggregate fair values of
$23,000 and ($36,000), respectively, and are included in Other Assets or Other
Liabilities in the accompanying consolidated balance sheets. The interest rate
swaps have the same notional values as the related debt and expire on the same
dates as the related debt.
In November 1999, we issued notes in the amount of 250,000 GBP ($392,500
at the date of acquisition) in connection with the acquisition of DJM
Cryo-Research Group. The notes bear interest at 6% which are payable
annually and principal is payable in five equal annual installments which
commenced in November 2003. At July 1, 2006 and December 31, 2005, the
balance due on the notes was 100,000 GBP ($184,000) and 100,000 GBP
($172,000), respectively.
We are parties to first and second mortgages on the facility of our
Netherlands subsidiary, which bear interest of 5.50% and
5.45%, respectively, per annum. During the terms of the mortgages, we are
obligated to make monthly payments of interest and quarterly payments of
principal. At July 1, 2006, $73,000 and $100,000 was
outstanding under the first and second mortgages, respectively, and at
December 31, 2005, $80,000 and $107,000 was outstanding
under the first and second mortgages, respectively. Each mortgage requires 80
equal quarterly payments of principal.
Note 5 - Stock-Based Compensation:
We have non-qualified stock option plans for Officers and Key Employees, 10%
Shareholder Directors and Nonemployee Directors. These plans are administered
10
by the Governance and Compensation Committee of the Board of Directors. Options
generally vest over five years from the date of grant. The exercise price of
the options granted under the Nonemployee Directors plan must be at least 85% of
the fair value of our Common Stock at the time the options are granted, all
other plans require the exercise price of the options granted be not less than
the fair market value of our Common Stock at the time the options are granted.
Options may be exercised for a period of up to ten years from the date they are
granted.
In December 2004, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS") No. 123 (revised 2004),
"Share-Based Payment" ("SFAS 123R"), which replaces "Accounting for Stock-Based
Compensation," ("SFAS 123") and supersedes Accounting Principles Board ("APB")
Opinion No. 25, "Accounting for Stock Issued to Employees." SFAS 123R requires
all sharebased payments to employees, including grants of employee stock
options, to be recognized in the financial statements based on their fair values
beginning with the first annual reporting period that begins after June 15,
2005. Under SFAS 123R, the pro forma disclosures previously permitted under
SFAS 123 are no longer an alternative to financial statement recognition.
We adopted the new standard effective January 1, 2006 and
have selected the Black-Scholes method of valuation for share-based
compensation. We have adopted the modified prospective transition method which
requires that compensation cost be recorded, as earned, for all unvested stock
options and restricted stock outstanding at the beginning of the first quarter
of adoption of SFAS 123R. The charge is being recognized in cost of sales,
selling, general and administrative expenses and research, development and
engineering expenses over the remaining service period after the adoption date
based on the options' original estimate of fair value.
The following table summarizes option activity for the six months ended
July 1, 2006:
Weighted
Average Aggregate
Weighted Remaining Intrinsic
Average Contract Value
Stock Exercise Term (in
Options Price (in years) thousands)
--------- --------- ---------- -----------
Outstanding at December 31, 2005 591,920 $ 4.93
Granted at exercise prices which equaled the fair market value on the date of grant 107,000 7.14
Exercised (219,341) 4.65
Forfeited (375) 4.53
---------
Outstanding at July 1, 2006 479,204 $ 5.54 3.54 $ 1,387
=========
Exercisable at July 1, 2006 166,212 $ 4.48 1.90 $ 463
=========
The fair value for each stock option granted was estimated at the date of grant
using a Black-Scholes option-pricing model. The expected term of options is
estimated based on our historical exercise rate and forfeiture rates are
estimated based on employment termination experience. The risk-free rate is
11
based on U.S. Treasury yields for securities in effect at the time of grant with
terms approximating the expected term until exercise of the option.
The table below presents the assumptions used to calculate the fair value of
options granted during the three and six months ended July
1, 2006 and July 2, 2005:
Three Months Ended Six Months Ended
---------------------------------- ----------------
July 1, July 2, July 1, July 2,
2006 2005 2006 2005
------------------ ---------------- -------- --------
Expected life (years) N/A N/A 4.5 6.0
Expected volatility N/A N/A 48.08% 40.35%
Expected dividend yield N/A N/A -- --
Risk-free interest rate N/A N/A 4.53% 3.99%
Weighted average fair value of options granted during the year N/A N/A 3.23 2.79
In the three and six month periods ended July 1, 2006, we recorded pre-tax
share-based compensation for options of $82,000 and $148,000, respectively,
which is included in our income before income tax for the periods. Had we not
adopted SFAS 123R, the effect on basic and diluted income per share for the
periods ended July 1, 2006 would have been an increase of
$0.01 for the three month period and $0.01 for the six month period. As of
July 1, 2006, $8,000 of compensation costs associated with
the adoption of SFAS 123R was capitalized into inventory. As of July 1, 2006,
there was $795,000 of total unrecognized compensation cost related to unvested
options that we expect to recognize over a weighted average period of 43 months.
We utilize newly issued shares to satisfy the exercise of stock options. Prior
to the adoption of SFAS 123R, we applied the intrinsic-value-based method of
accounting prescribed by APB 25, "Accounting for Stock Issued to Employees", and
related interpretations, to account for stock options granted to employees.
Under this method, compensation cost was recorded only if the market price of
the underlying common stock on the date of grant exceeded the exercise price.
SFAS 123, "Accounting for Stock-Based Compensation", established accounting and
disclosure requirements using a fair-value-based method of accounting for
stock-based employee compensation plans. As permitted by SFAS 123, we elected
to continue to apply the intrinsic-value-based method of accounting described
above, and adopted only the disclosure requirements of SFAS 123, as amended,
which were similar in most respects to SFAS 123R, with the exception of option
forfeitures, which we accounted for as they occurred.
12
The following table illustrates the pro forma effect on our net income and net
income per share as if we had adopted the fair value-based method of accounting
for stock-based compensation under SFAS 123 for the three and six months ended
July 2, 2005 (in thousands, except per share amounts):
Three Months Six Months
Ended Ended
July 2, July 2,
2005 2005
-------------- ---------------------
Net income as reported $ 4 $ 411
Deduct: Total stock-based employee
compensation expense determined under fair
value based method, net of related tax effects 94 173
-------------- ---------------------
Pro forma net (loss) income $ (90) $ 238
-------------- =====================
(Loss) income per share:
Basic-as reported $ 0.00 $ 0.05
============== =====================
Basic-pro forma $ (0.01) $ 0.03
============== =====================
Diluted-as reported $ 0.00 $ 0.05
============== =====================
Diluted-pro forma $ (0.01) $ 0.03
============== =====================
Prior to the adoption of SFAS 123R, we presented all tax benefits of deductions
resulting from the exercise of stock options as operating cash flows in the
Statement of Cash Flows. SFAS 123R requires that the cash flows resulting from
tax benefits resulting from tax deductions in excess of the compensation cost
recognized for those options (excess tax benefits) be classified as financing
cash flows. Cash received from stock options exercised for the three and six
months ended July 1, 2006 was $323,000 and $702,000,
respectively. Tax benefits realized from stock option exercises for the three
and six months ended July 1, 2006 was $106,000 and
$287,000, respectively.
In November 2005, the FASB issued FASB Staff Position 123(R)-3, "Transition
Election Related to Accounting for the Tax Effects of Share-based Payment
Awards" ("FSP 123R-3"). FSP 123R-3 provides an elective alternative transition
method of calculating the additional paid-in capital pool ("APIC POOL") of
excess tax benefits available to absorb tax deficiencies recognized subsequent
to the adoption of SFAS 123R to the method otherwise required by paragraph 81 of
SFAS 123R. We have concluded that we will use the alternative method allowed by
FSP 123R-3.
13
Note 6 - Pension plan:
Components of net periodic benefit cost for the three and six months ended
July 1, 2006 and July 2, 2005 are as
follows (in thousands):
Three Months Ended Six Months Ended
--------------------------------------- ------------------
July 1, July 2, July 1, July 2,
2006 2005 2006 2005
-------------------- ------------------ --------- ---------
Service cost $ 109 $ 88 $ 218 $ 176
Interest cost 132 124 264 248
Expected return on plan assets (136) (132) (272) (264)
Amortization of net obligation 5 5 10 10
Amortization of prior service costs (1) (1) (2) (2)
Amortization of net loss 60 48 120 96
-------------------- ------------------ --------- ---------
Net periodic pension cost $ 169 $ 132 $ 338 $ 264
==================== ================== ========= =========
We previously disclosed in our financial statements for the year ended
December 31, 2005, that we expect to contribute $800,000
to our pension plan in 2006. Subsequently during our annual Pension Trustee's
meeting with our actuary, it was decided to increase the contribution to
$1,020,000. As of July 1, 2006, $425,000 of contributions have been made.
We have a defined contribution plan for our U.S. employees,
with a specified matching employer contribution. The employer's expense for the
three and six month period ended July 1, 2006 and July 2, 2005 was $40,000 and
$89,000, respectively, for the 2006 periods and $42,000 and $83,000,
respectively, for the 2005 periods.
Note 7 - Recently Issued Accounting Pronouncements
In June 2006, the FASB issued FASB Interpretation No. 48, "Accounting for
Uncertainty in Income Taxes". The Interpretation clarifies the accounting for
uncertainty in income taxes recognized in a company's financial statements in
accordance with Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes". The Interpretation prescribes a recognition threshold and a
measurement attribute for the financial statement recognition and measurement of
a tax position taken or expected to be taken in a tax return. The
Interpretation also provides guidance on the related de-recognition,
classification, interest and penalties, accounting for interim periods,
disclosure and transition of uncertain tax positions. The Interpretation is
effective for fiscal years beginning after December 15,
2006, with the cumulative effect of the change in accounting principle recorded
as an adjustment to opening retained earnings. We are evaluating the impact of
this new pronouncement on our consolidated financial statements.
14
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
The following is Management's Discussion and Analysis of significant factors
that have affected our operating results and financial condition during the
three and six month periods ended July 1, 2006 and July 2, 2005, respectively,
which should be read in conjunction with our Annual Report on Form 10-K for the
year ended December 31, 2005.
We are in the process of implementing our enterprise resource planning system
("ERP System"). The implementation will be phased in over the next three years,
including a significant portion which is expected to occur in the fourth quarter
of 2006. The implementation includes changes that involve internal controls
over financial reporting. Although we expect the implementation to proceed
without any material adverse effects, the possibility exists that the migration
to our ERP System could adversely affect our internal controls, our disclosure
controls and procedures or our results of operations in future periods.
RESULTS OF OPERATIONS
---------------------
EXECUTIVE OVERVIEW
- -------------------
We are a leading provider of a wide variety of research equipment and scientific
instruments for the life sciences used to create, maintain and control the
physical and biochemical conditions required for the growth, detection and
storage of microorganisms.
Our products are used for medical, biological, chemical and environmental
research and for the commercial development of antibiotics, proteins, hormones,
enzymes, monoclonal antibodies, agricultural products, fuels, vitamins, vaccines
and other substances.
We sell our equipment to pharmaceutical companies, agricultural and chemical
companies, other industrial customers engaged in biotechnology, and to medical
schools, universities, research institutes, hospitals, private laboratories and
laboratories of federal, state and municipal government departments and agencies
in the United States. While only a small percentage of our
sales are made directly to United States government
departments and agencies, our domestic business is significantly affected by
government expenditures and grants for research to educational research
institutions and to industry. We also sell our equipment both directly
(primarily in Europe) and through scientific equipment dealers to foreign
companies, institutions and governments. Foreign sales may be affected by
U.S. export control regulations applicable to scientific
equipment.
Fisher Scientific, our largest customer, is the exclusive U.S.
distributor of our C-Line, E-Series and I-Series biological shakers and is the
exclusive dealer for our CO2 incubators in the U.S. Fisher
Scientific is also the exclusive distributor of our C-Line shakers in certain
European countries and has a broader distribution arrangement with us in
Canada and in France.
15
NET SALES
- ----------
The following tables summarizes consolidated backlog, net orders and net sales
for the three and six months ended July 1, 2006 and
July 2, 2005 (in thousands of dollars):
Three Months Ended
-------------------
July 1, July 2, (Decrease) %
2006 2005 Increase Change
------------------- -------- ----------- -------
Backlog - beginning $ 10,421 $ 7,987 $ 2,434 30.5%
Add net orders received 17,594 16,198 1,396 8.6
Less net sales 18,586 15,180 3,406 22.4
------------------- -------- -----------
Backlog - ending $ 9,429 $ 9,005 $ 424 4.7
=================== ======== ===========
Six Months Ended
-----------------
July 1, July 2, (Decrease) %
2006 2005 Increase Change
----------------- -------- ----------- -------
Backlog - beginning $ 10,776 $ 8,376 $ 2,400 28.7%
Add net orders received 34,206 31,917 2,289 7.2
Less net sales 35,553 31,288 4,265 13.6
----------------- -------- -----------
Backlog - ending $ 9,429 $ 9,005 $ 424 4.7
================= ======== ===========
Net sales for the three months ended July 1, 2006
increased $3,406,000 or 22.4% to $18,586,000 from $15,180,000 for the 2005
quarter. Domestic and international sales increased 25.7% and 20.1%,
respectively. The effects of foreign currency translation on net sales during
the three months ended July 1, 2006 was not significant.
The overall increase in net sales for the three months ended
July 1, 2006 was due principally to higher shipments of
fermentation equipment, ultra low temperature freezers and biological shakers.
Net sales for the six months ended July 1, 2006 increased
$4,265,000 or 13.6% to $33,553,000 from $31,288,000 for the 2005 six month
period. Domestic and international sales increased 11.0% and 15.4%,
respectively. Due to the strength of the dollar during the six months
ended July 1, 2006 versus the 2005 six month period, the effects of foreign
currency translation negatively affected net sales during the six
months ended July 1, 2006 by $596,000 or 1.9% of net sales when
compared with the 2005 six month period. The overall increase in net sales for
the six months ended July 1, 2006 was principally due to
higher shipments of fermentation equipment, ultra low temperature freezers and
CO2 incubators.
Orders during the three months and six months ended July
1, 2006 increased 8.6% and 7.2%, respectively. As of July
1, 2006 the backlog increased 4.7%. As a result of higher inventory levels,
reduced cycle times and improved production planning, we were able to handle the
increase in orders with only a minor increase in backlog from the July 2, 2005
level.
16
GROSS MARGIN
- -------------
The following table shows gross profit and gross margin for the three and six
months ended July 1, 2006 and July 2, 2005 (in thousands of dollars):
Three Months Ended Six Months Ended
-------------------- ------------------
July 1, July 2 July 1, July 2
2006 2005 2006 2005
-------------------- ------------------ --------- --------
Net sales $ 18,586 $ 15,180 $ 35,553 $31,288
Cost of sales 10,922 9,267 20,982 19,073
-------------------- ------------------ --------- --------
Gross profit $ 7,664 $ 5,913 $ 14,571 $12,215
==================== ================== ========= ========
Gross margin 41.2% 39.0% 41.0% 39.0%
==================== ================== ========= ========
Gross margin for the three months ended July 1, 2006 increased to 41.2% from
39.0% for the 2005 quarter and increased to 41.0% for the six months ended July
1, 2006 from 39.0% for the 2005 six month period. These increases are due
primarily to greater absorption of overhead due to the increased production at
our factories. The 2005 periods were negatively impacted by effects of our
aggressive pricing strategy, which was aimed at gaining market share for certain
products in select markets. Cost of goods sold for the three and six months
ended July 1, 2006 incuded a share-based compensation charge of $7,000
associated with the adoption of SFAS 123R. As of July 1,
2006, $8,000 of compensation costs associated with the adoption of SFAS 123R was
capitalized into inventory.
SELLING, GENERAL AND ADMINISTRATIVE
- --------------------------------------
Selling, general and administrative expenses for the three months ended
July 1, 2006 increased $317,000 or 6.9% to $4,918,000 from
$4,601,000 during the 2005 quarter. This increase was primarily due to: (i)
training, data conversion, consulting and maintenance costs associated with our
enterprise resource planning system; (ii) increased commissions and related
selling costs associated with our increased sales levels and (iii) a share-based
compensation charge of $69,000 associated with the adoption of SFAS 123R.
Partially offsetting these increases was a $9,000 benefit from the foreign
currency translation effect of the stronger US dollar. The
2005 quarter was negatively impacted by $61,000 of consulting costs related to
Sarbanes-Oxley Section 404 compliance.
17
Selling, general and administrative expenses for the six months ended
July 1, 2006 increased $421,000 or 4.6% to $9,544,000 from $9,123,000 during the
2005 six month period. This increase was primarily due to: (i) training, data
conversion, consulting, and maintenance costs associated with our enterprise
resource planning system; (ii) increased personnel and related cost associated
with our sales and service groups and (iii) a share-based compensation charge of
$130,000 associated with the adoption of SFAS 123R. Partially offsetting these
increases was a $155,000 benefit from the foreign currency translation effect of
the stronger US dollar versus the 2005 six month period. The
2005 six month period was negatively impacted by $189,000 of consulting costs
related to Sarbanes-Oxley Section 404 compliance.
RESEARCH, DEVELOPMENT AND ENGINEERING
- ----------------------------------------
Research, development and engineering expenses for the three months ended July
1, 2006 decreased $92,000 or 7.4% to $1,147,000 from $1,239,000 during the 2005
quarter and increased $57,000 or 2.4% for the six months ended July 1, 2006 to
$2,433,000 from $2,376,000 during the 2005 six month period. Spending for the
2006 and 2005 periods reflect the costs associated with our aggressive
development schedule for new products. The three and six months ended July 1,
2006 included a share-based compensation charge of $6,000 and $11,000,
respectively, associated with the adoption of SFAS 123R.
INTEREST INCOME
- ----------------
Interest income for the three and six months ended July 1,
2006 increased to $86,000 and $174,000, respectively, from $58,000 and $111,000,
respectively, for the three and six months ended July 2,
2005. These increases are due primarily to rising interest rates on invested
cash.
INTEREST EXPENSE
- -----------------
Interest expense for the three months ended July 1, 2006
decreased to $77,000 from $145,000 during the 2005 quarter. This reduction in
interest expense is due to: (i) capitalized interest of $14,000 on our new
enterprise resource planning system in the 2006 quarter, (ii) an increase in the
favorable change in the fair value of interest rate swaps from zero in the 2005
quarter to $28,000 in the 2006 quarter and, (iii) a lower level of average
outstanding debt during the 2006 quarter.
Interest expense for the six months ended July 1, 2006
decreased to $167,000 from $181,000 during the 2005 six month period. This
reduction in interest expense is due to capitalized interest of $14,000 on our
new enterprise resource planning system in the 2006 six month period and a lower
level of average outstanding debt during the 2006 six month period. Offsetting
this was a decrease in the favorable change in the fair value of interest rate
swaps from $117,000 in the 2005 six month period to $52,000 in the 2006 six
month period.
18
OTHER INCOME (EXPENSE)
- ------------------------
The following table details other income (expense) for the three and six months
ended July 1, 2006 and July 2, 2005
(in thousands):
Three Months Ended Six Months Ended
-------------------- ------------------
July 1, July 2, July 1, July 2,
2006 2005 2006 2005
-------------------- ------------------ --------- ---------
(Loss) gain on foreign currency transactions (a) $ (25) $ 16 $ (43) $ 48
Bank fees (9) (11) (19) (21)
Other, net (1) (3) (3) (6)
-------------------- ------------------ --------- ---------
Total other income (expense) $ (35) $ 2 $ (65) $ 21
==================== ================== ========= =========
<FN>
_______________________
(a) Foreign exchange gains and losses relate primarily to the settlement of purchases in the normal course
of business between our United States and European operating companies.
INCOME TAX EXPENSE
- --------------------
For the six months ended July 1, 2006 we used our expected
effective tax rate for the year, based on projected U.S. and
foreign results, which amounted to 36.9%. The decrease in our effective income
tax rate from 38.4% for the six months ended July 2, 2005 is attributable to a
number of factors including: (i) a decrease in state and local taxes, (ii) the
tax impact on the income of our foreign subsidiaries which are taxed at lower
rates, (iii) deductibility of certain expenses, and (iv) utilization of loss
carryforwards from certain of our European subsidiaries.
19
FINANCIAL CONDITION
-------------------
LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
CONTRACTUAL OBLIGATIONS
Our contractual obligations and commitments principally include obligations
associated with our outstanding indebtedness and future minimum operating lease
obligations as of July 1, 2006 are set forth in the
following table:
Payments Due by Period
(In thousands)
------------------------
Contractual obligations:
Less than 1-3 3-5 More than
Total 1 Year Years Years 5 Years
------------------------ ---------- ------ ------ ----------
Long-term debt,
obligations (a) $ 5,641 $ 4,459 $1,179 $ 3 $ -
Operating lease obligations (b) 2,860 764 1,257 406 433
Purchase obligations(c) 7,695 7,580 115 - -
------------------------ ---------- ------ ------ ----------
Total contractual cash
Obligations $ 16,196 $ 12,803 $2,551 $ 409 $ 433
======================== ========== ====== ====== ==========
<FN>
_____________________
(a) Consists primarily of debt incurred for acquisitions financed under our Bank Agreement
and of notes due to the sellers of businesses acquired by us.
(b) Primarily reflects (on a gross basis before sublet income) lease obligations for five
premises in the United Kingdom, two of which have been sublet. Both of the
subleased premises have been sublet for the entire terms of their leases. One has
a lease expiration date of 2014 and an annual rental of 99,750 GBP ($184,000 at July
1, 2006). The second sublet premises has a lease expiration date of
September 28, 2009 and an annual rental of 45,000 GBP ($83,000 at
July 1, 2006).
(c) Primarily includes commitments for raw materials and services related to production of
products at our various manufacturing facilities.
GUARANTEES
In order to secure a 250,000 GBP grant from the Scottish Ministers, Scottish
Executive Enterprise, Transport and Lifelong Learning Department for the
relocation and expansion of our facility in Scottland,
UK, we guaranteed the repayment of that grant for up to 250,000 GBPs
plus interest, should we not fulfill our obligations under that grant. Among
other conditions, the Scottish Ministers could recall all or a portion of the
grant should we fail to meet specific job targets or experience a change in
control. As of July 1, 2006 the amount of the guarantee
is zero since at that time we hadn't received any portion of this grant. On
August 8, 2006 we received the first installment under the grant which amounted
to 110,000 GBPs. The guarantee will terminate on the fifth anniversary of the
first payment of the grant.
20
OPERATING ACTIVITIES
- --------------------
Cash and cash equivalents decreased $3,504,000 to $7,847,000 at
July 1, 2006 from $11,351,000 at
December 31, 2005. Net cash used in operating
activities amounted to $2,162,000 for the six months ended
July 1, 2006. The overall factors primarily affecting
operating cash flows during the six months ended July 1, 2006 were: (i) an
increase in inventory in order to maintain shipping levels on our current and
future orders, (ii) a decrease in accounts payable and accrued expenses due to
the timing of purchases and payments on those purchases, (iii) an increase in
accounts and notes receivable as a result of higher sales levels, and (iv) a
decrease in other liabilities. Partially offsetting these uses of cash were:
(i) net income of $1,600,000, which gets adjusted for non-cash items such as
depreciation and amortization, share-based compensation and a change in fair
value of interest rate swaps, and (ii) a decrease in prepaid expenses and other
current assets.
INVESTING ACTIVITIES
- --------------------
For the six months ended July 1, 2006, net cash used in investing activities of
$2,100,000 was a result of: (i) 696,000 ($1,357,000) for the purchase of land
and building in Irvine, Scottland for our RS Biotech subsidiary, (ii) $345,000
of capitalized costs associated with our new enterprise resource planning
system, and (iii) normal additions to property, plant and equipment.
FINANCING ACTIVITIES
- ---------------------
For the six months ended July 1, 2006, net cash provided
by financing activities totaled $672,000 and primarily consisted of proceeds
from the issue of shares under stock purchase and option plans that totaled
$771,000, tax benefits from exercised stock options that totaled $287,000, which
was partially offset by repayments of long-term debt of $386,000.
BANK AGREEMENT
- ---------------
We are parties to an agreement with Wachovia Bank, National Association (the
"Bank"), which has had a number of amendments (the "Bank Agreement"), which has
been extended to May 31, 2008, and which provides us with a credit facility for
acquisitions, equipment loans, working capital and letters of credit and foreign
exchange transactions. The maturity of the outstanding debt incurred related to
the acquisition portion of the credit facility with respect to a 1999
acquisition is December 1, 2006, and with respect to a
2003 acquisition is November 1, 2008. The maturity date
of the outstanding debt incurred related to the equipment loan portion of the
credit facility is November 1, 2008. We expect to repay
the $4.5 million due on December 1, 2006 with cash on
hand. There are no compensating balance requirements and any borrowings under
the Bank Agreement bear interest at the Bank's prime rate less 125 basis points
or LIBOR plus 125 basis points, at our discretion. At
July 1, 2006, the Bank's prime rate was 8.25% and LIBOR was 5.33%.
Since the Bank Agreement requires that all borrowings be at variable interest
rates, the Bank provides us with a mechanism to fix interest rates on borrowings
by use of interest rate swaps. At July 1, 2006 we had
three interest rate swaps in place to fix the interest rates, primarily for debt
incurred for acquisitions in 1999 and 2003.
21
All of our domestic assets, which are not otherwise subject to lien, have been
pledged as security for any borrowings under the Bank Agreement. The Bank
Agreement contains various business and financial covenants including among
other things, a debt service ratio, a net worth covenant and a ratio of total
liabilities to tangible net worth. We were in compliance with its covenants
pursuant to the Bank Agreement at July 1, 2006 and
currently anticipate being in compliance with such covenants during the next 12
months.
CRITICAL ACCOUNTING POLICIES
- ------------------------------
No changes have been made in our critical accounting policies during the six
months ended July 1, 2006 except for the adoption on
January 1, 2006 of SFAS No. 123R. See footnote 5 in the
consolidated financial statements for more information.
22
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
The information required by Item 3 has been disclosed in Item 7 of our Annual
Report on Form 10-K for the year ended December 31,
2005. There has been no material change in the disclosures regarding market
risk.
ITEM 4. CONTROLS AND PROCEDURES.
Our Chief Executive Officer and Chief Financial Officer evaluated the
effectiveness of our disclosure controls and procedures as of the end of the
period covered by this report. Based on that evaluation, the Chief Executive
Officer and Chief Financial Officer concluded that our disclosure controls and
procedures were not effective as of the fiscal quarter ended
July 1, 2006. This was due to the determination that we
did not have adequate controls and procedures in place to ensure that the shares
of our common stock being offered and sold under the New Brunswick Scientific
Co., Inc. Employee Stock Purchase Plan (the "Plan") were properly registered.
As a result, we did not disclose in prior Form 10-K and Form 10-Q filings
certain unregistered sales of our common stock under the Plan in accordance with
Securities and Exchange Commission requirements, as more fully described in Part
II, Item 2, of this Form 10-Q. We have instituted revised procedures to prevent
any further inadvertent sales of unregistered shares of our Common Stock under
the Plan.
23
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
No material legal proceedings are currently pending.
From time to time, we are involved in litigation in the normal course of
business, which we believe, after consultation with counsel, the ultimate
disposition of which will not have a material adverse effect on our consolidated
results of operations or financial position.
ITEM 1A. RISK FACTORS.
There have been no material changes during the six months ended July 1, 2006
from the risk factors reported in our Annual Report on Form 10-K for the year
ended December 31, 2005.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
In May 1987, the Company's shareholders approved the New Brunswick
Scientific Co., Inc. Employee Stock Purchase Plan (the "Plan"), established in
accordance with Section 423 of the Internal Revenue Code, pursuant to which
employees are entitled through payroll deductions to purchase periodically
shares of our Common Stock at a discount to the prevailing market price. At the
time of the establishment of the Plan, 100,000 shares of Common Stock were
registered under the Securities Act of 1933, as amended (the "1933 Act"), for
sale under the Plan.
During the quarter ended July 1, 2006, we determined that we had failed to
register properly 354,615 shares of Common Stock issued under the Plan,
consisting of (i) 100,000 shares and 150,000 shares authorized for issuance
under the Plan pursuant to Plan amendments approved by shareholders in May 1995
and May 2003, respectively, and (ii) 104,615 shares of Common Stock that become
issuable pursuant to the antidilution adjustment provisions of the Plan as the
result of a series of stock dividends paid by the Company. These unregistered
shares were sold over the period December 1996, when the last of the 100,000
shares initially registered were sold, and June 2006, when we suspended further
sales under the Plan due to the discovery that the shares being offered and sold
were not properly registered.
We believe that some, although not necessarily all, of the unregistered
shares of Common Stock offered and sold were exempt from registration under the
1933 Act in accordance with Section 4(2) based on the purchaser's knowledge of
the Company and his or her financial sophistication. However, we have not made
an analysis to determine the precise number of shares that qualified for the
Section 4(2) exemption.
We received gross proceeds of approximately $1,275,975 from the sale of the
unregistered shares of Common Stock, which we used for general corporate
purposes.
24
On August 10, 2006, we filed a Registration Statement on Form S-8 (i)
registering for sale under the Plan 125,579 unsold shares of Common Stock
authorized for issuance under the Plan and (ii) registering for resale 6,123
unregistered shares of Common Stock previously sold under the Plan.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
a) Our annual meeting of shareholders was held on May 31, 2006.
c) The following matters were voted upon at the annual meeting:
(i) To elect three Class I directors of the Corporation to terms of three
years. The votes cast for each director were as follows:
For Withheld
--- --------
Kenneth Freedman 6,756,000 335,033
Peter Schkeeper 6,760,950 330,083
Ernest Gross 6,754,608 336,425
(ii) To approve and adopt an amendment to the Corporation's
Employee Stock Purchase Plan increasing the authorized
shares by 100,000. The votes were cast as follows:
Broker
Approve Disapprove Abstain Nonvotes
------- ---------- ------- --------
4,385,416 379,036 4,170 2,322,411
(iii) To approve and adopt and amendment to the Corporations
2001 Nonqualified Stock Option Plan for Officers and
Key Employees increasing the number of authorized shares
by 100,000. The votes were cast as follows:
Broker
Approve Disapprove Abstain Nonvotes
------- ---------- ------- --------
4,360,589 401,821 6,212 2,322,411
ITEM 6. EXHIBITS.
Exhibit
Number Description
3(a) Restated Certificate of Incorporation, as amended is incorporated herein by reference to Exhibit (4)
to the Registrant's Registration Statment on Form s-8 on file with the commission (No. 33-15606), and with respect
to two amendments to said Restated Certificate of Incorporation, to Exhibit (4b) of Registrant's Registration
Statement on form S-8 (No. 33-16024).
3(b) Restated By-Laws of the Company, as amended and restated is incorporated herein by reference to Exhibit (3b) to the
Registrant's Annual report on Form 10-K for the year ended December 31, 2004.
25
3(c) Rights Agreement dated as of October 31, 1999 between New Brunswick Scientific Co., Inc. and American Stock Transfer
& Trust Company, as Rights Agent, which includes the Form of Right Certificate as Exhibit A and the Summary of Terms
of the Rights Agreement as Exhibit B is incorporated herein by reference to Registrant's Current Report on Form 8-K
filed on October 29, 1999.
3(d) Amendment to the Restated Certificate of Incorporation of the Company is incorporated herein by reference to Item 2
of Registrant's Proxy Statement filed iwth the Commission on or about April 13, 1999.
4 See the provisions relating to capital structure in the Restated Certificate of Incorporation, amendment thereto,
incorporated herein by reference from the Exhibits to the Registration Statements identified in Exhibit 3 above.
10.1 New Brunswick Scientific Co., Inc. Employee Stock Purchase Plan, as amended, is incorporated herein by reference to
Item 2 of Registrant's Proxy Statement filed with the Commission on April 17, 2005.
10.2 Agreements related to the purchase of land and building at 1 Drummond Crescent, Riverside Business PPark, Irvine,
Scotland in the United Kingdom are incorporated herein by reference to the exhibits to our Current Report on Form 8-K
dated April 28, 2006
31.1 Section 302 Certification - Chief Executive Officer.
31.2 Section 302 Certification - Chief Financial Officer.
32 Section 906 Certifications.
26
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
StateplaceNEW BRUNSWICK SCIENTIFIC CO., INC.
--------------------------------------------
(Registrant)
Date: August 11, 2006 /s/ PersonNameDavid Freedman
----------------------------
David Freedman
Chairman and
Chief Executive Officer
Date: August 11, 2006 /s/ Thomas Bocchino
-------------------
Thomas Bocchino
Vice President, Finance,
Chief Financial Officer and Treasurer
(Chief Accounting Officer)
27