Landauer Reports Fiscal 2016 Second Quarter Results

GLENWOOD, Ill., May 9, 2016 /PRNewswire/ -- Landauer, Inc. (NYSE: LDR), a recognized leader in personal and environmental radiation measurement and monitoring, outsourced medical physics services and high quality medical consumable accessories, today reported financial results for its fiscal 2016 second quarter ended March 31, 2016.

Fiscal 2016 Second Quarter Highlights

• Revenue of $38.1 million, including impact of $1.6 million reduction in revenue related to divestiture of Radon business and $0.6 million unfavorable impact from foreign currency translation rates
  • Revenues grew 5.8% year-over-year, excluding the divested Radon business and unfavorable impact of foreign currency translation
  • Domestic Radiation Measurement services revenues increased 5.0% year-over-year
  • Medical Physics revenues grew 16.3% year-over-year
• Operating income of $7.2 million, a 28.6% increase compared to the second quarter of 2015
  • Consolidated operating income margin improved to 18.9% from 14.7% in the second quarter of 2015 driven by a decrease in selling, general and administrative expenses
• Net income of $4.3 million compared to $3.5 million in the second quarter of 2015
• Adjusted net income of $5.0 million on track with full-year guidance
• On a GAAP basis, earnings per diluted share of $0.45
• Announces divestiture of Medical Products business

Mike Kaminski, President and Chief Executive Officer of Landauer stated, "Our second quarter results reflect strong momentum on our key initiatives.  Our efforts to grow high-margin, recurring revenue opportunities are yielding positive results, as demonstrated by the continued double-digit growth in our Medical Physics segment.  In addition, our lean initiatives have contributed to the improvement in our operating margins across all our segments.  The development of our next generation dosimetry platform continues to progress on track with our expectations of beginning field testing in the second half of the year, and we are confident that our innovative design will be well positioned to meet the evolving needs of our customers."

Second Fiscal Quarter Financial Overview and Business Segment Results

Revenues were $38.1 million for both the second fiscal quarter of 2016 and the second fiscal quarter of 2015. Radiation Measurement revenues for the quarter were $25.5 million compared to $27.2 million for the second fiscal quarter of 2015. The decrease in revenues was primarily due to the divestiture of the Company's Radon business in September 2015, resulting in a $1.6 million reduction in revenues.  In addition, unfavorable foreign currency translation rates reduced revenues by $0.6 million. Domestic Radiation Measurement services revenues increased 5.0%, partially offsetting the impact of the Radon business divestiture and the foreign currency rates.  Medical Physics revenues increased $1.4 million, or 16.3%, to $10.0 million, due to increased demand for imaging services.  Excluding the divested Radon business and unfavorable impact of foreign currency translation, total revenues increased 5.8% compared to the prior year period.

Operating income for the second fiscal quarter of 2016 was $7.2 million, compared to operating income of $5.6 million for the second fiscal quarter of 2015. Consolidated operating income margin improved to 18.9% from 14.7% in the second fiscal quarter of 2015.  These increased operating income results reflect improvement across all business segments and were driven by a decrease in selling, general and administrative expenses, as well as higher gross margins. 

Fiscal Six Months Financial Overview

Revenues for the first six months of fiscal 2016 were $74.6 million, a 1.5% decrease compared to $75.7 million for the first six months of fiscal 2015. The Radiation Measurement segment decreased $3.5 million due to the divestiture of the Company's Radon business, resulting in a $3.2 million reduction in revenues, and an unfavorable foreign currency impact of $1.8 million. The Medical Physics segment increased $2.4 million, due to continued increased demand for imaging services.

Operating income for the first six months of fiscal 2016 was $13.5 million, a 14.4% increase compared to operating income of $11.8 million for the first six months of fiscal 2015. The increase in operating income was driven by the decrease in Corporate and Radiation Measurement selling, general and administrative expenses, offset by the impact of the lower revenues in the Radiation Measurement segment.

Medical Products Divestiture

On May 3, 2016, the Company divested its Medical Products business for a total consideration of $12 million.  Additionally, through the transaction, the Company anticipates realizing approximately $20 million in tax benefits over the next several years.  The Company expects to utilize the proceeds from this divestiture to pay down debt and reinvest into continuing growth initiatives.  The Medical Products business represented $9.9 million in revenue for 2015, less than 7% of the Company's total 2015 revenue.

Use of Non GAAP Financial Measures

Adjusted EBITDA is presented here not as an alternative to net income, but rather as a measure of the Company's operating performance and is not intended to be a presentation in accordance with GAAP. Since EBITDA (generally, net income plus interest expenses, taxes, depreciation and amortization) is not calculated identically by all companies, this presentation may not be comparable to EBITDA or Adjusted EBITDA presentations disclosed by other companies. Adjusted EBITDA represents net income with adjustments for net financing costs, depreciation and amortization, provision for income taxes, stock compensation expense, goodwill and other intangible assets impairments, and acquisition, reorganization and nonrecurring costs. Management believes that Adjusted EBITDA is useful in evaluating the Company's operating performance compared to that of other companies in its industry because the calculation of Adjusted EBITDA generally eliminates the effects of certain non-cash and other items that may vary for different companies for reasons unrelated to overall operating performance.

In addition, the Company's management used Adjusted Net Income as a measure of earnings to eliminate the effects of certain non-cash and nonrecurring items of the Company. Adjusted Net Income represents net income with tax-effected adjustments for stock compensation expense, goodwill and other intangible assets impairments and acquisition, reorganization and nonrecurring costs. However, Adjusted EBITDA and Adjusted Net Income are not recognized measurements under GAAP and should not be considered as an alternative to the most directly comparable measures presented in accordance with GAAP. A reconciliation of these non-GAAP measures to the most directly comparable GAAP measures is included within this news release.

Conference Call Details

Landauer has scheduled its second quarter conference call for investors over the Internet on Monday, May 9, 2016, at 4:00 p.m. Central Time (5:00 p.m. Eastern Time). To participate, callers should dial 866-866-1542 (within the United States and Canada), or 707-294-1539 (international callers), passcode 4199981, about 10 minutes before the presentation. To listen to a webcast on the Internet, please go to the Company's website at http://www.landauer.com at least 15 minutes early to register, download and install any necessary audio software. Investors may access a replay of the call by dialing 855-859-2056 (within the United States and Canada), or 404-537-3406 (international callers), passcode 4199981, which will be available through Wednesday, June 8, 2016. The replay will also be available on Landauer's website for 30 days following the call.

About Landauer

Landauer is a leading global provider of technical and analytical services to determine occupational and environmental radiation exposure, the leading domestic provider of outsourced medical physics services, as well as a provider of high quality medical accessories used in radiology, radiation therapy, and image guided surgery procedures. For more than 50 years, the Company has provided complete radiation dosimetry services to hospitals, medical and dental offices, universities, national laboratories, nuclear facilities and other industries in which radiation poses a potential threat to employees. Landauer's services include the manufacture of various types of radiation detection monitors, the distribution and collection of the monitors to and from customers, and the analysis and reporting of exposure findings. The Company provides its dosimetry services to approximately 1.8 million individuals globally. In addition, through its Medical Physics segment, the Company provides therapeutic and imaging physics services to the medical physics community. Through its Medical Products segment, the Company provides medical consumable accessories used in radiology, radiation therapy, and image guided surgery procedures. For information about Landauer, please visit their website at http://www.landauer.com.

Safe Harbor Statement

Some of the information shared here (including, in particular, the section titled "Fiscal 2016 Outlook") constitutes forward-looking statements that are based on assumptions and involve certain risks and uncertainties. These include the following, without limitation: assumptions, risks and uncertainties associated with the Company's future performance; the Company's development and introduction of new technologies in general; the ability to protect and utilize the Company's intellectual property; continued customer acceptance of the InLight technology; the adaptability of optically stimulated luminescence (OSL) technology to new platforms and formats; military and other government funding for the purchase of certain of the Company's equipment and services; the impact on sales and pricing of certain customer group purchasing arrangements; changes in spending or reimbursement for medical products or services; the costs associated with the Company's research and business development efforts; the usefulness of older technologies and related licenses and intellectual property; the effectiveness of and costs associated with the Company's IT platform enhancements; the anticipated results of operations of the Company and its subsidiaries or joint ventures; valuation of the Company's long-lived assets or reporting units relative to future cash flows; changes in pricing of services and products; changes in postal and delivery practices; the Company's business plans; anticipated revenue and cost growth; the ability to integrate the operations of acquired businesses and to realize the expected benefits of acquisitions; the risks associated with conducting business internationally; costs incurred for potential acquisitions or similar transactions; other anticipated financial events; the effects of changing economic and competitive conditions, including instability in capital markets which could impact availability of short and long-term financing; the timing and extent of changes in interest rates; the level of borrowings; foreign exchange rates; government regulations; accreditation requirements; changes in the trading market that affect the costs of obligations under the Company's benefit plans; and pending accounting pronouncements.

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