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Bio-Rad Laboratories, Inc. (BIO) Reports Third-Quarter 2012 Financial Results


11/7/2012 8:23:06 AM

HERCULES, CA--(Marketwire - November 06, 2012) - Bio-Rad Laboratories, Inc. (NYSE: BIO) and (NYSE: BIO.B), a multinational manufacturer and distributor of life science research and clinical diagnostic products, announced financial results today for the third quarter ended September 30, 2012.

Third-quarter reported revenues were $498.7 million, a decrease of 3.5% compared to $516.5 million reported for the third quarter of 2011. On a currency-neutral basis, quarterly revenues increased 3.6% compared to the same period last year. This growth includes $5.2 million of sales of droplet digital PCR products related to Bio-Rad's acquisition of QuantaLife in October 2011. Third-quarter gross margin was 54.8%, compared to 57.3% during the same quarter in 2011. Gross margin was impacted by approximately $2.2 million of amortization expense related to the Company's acquisition of QuantaLife, as well as a $3.8 million reserve associated with certain environmental issues.

Net income for third quarter was $42.4 million, or $1.48 per share on a fully diluted basis versus $45.9 million, or $1.61 per share reported for the same period last year. Bio-Rad's current quarter income results were favorably impacted by $8.5 million due to a reduction in the valuation of the contingent consideration associated with the QuantaLife acquisition.

Year-to-date revenues were $1.50 billion, a decrease of 1.8% compared to $1.52 billion reported in the first three quarters of 2011. Adjusting for the impact of currency, year-to-date revenue growth was 2.7%.

Year-to-date net income for the first three quarters of 2012 was $121.7 million, or $4.26 per share on a fully diluted basis compared to $119.0 million, or $4.18 per share reported during the same period in 2011.

"Performance in the third quarter reflects momentum and growth in many of our product areas, although macroeconomic challenges continue to have an impact on our performance," said Norman Schwartz, Bio-Rad President and Chief Executive Officer.

Life Science
The Life Science segment net sales for the third quarter were $167.0 million, down 2.6% compared to the same period last year. On a currency-neutral basis, Life Science segment sales increased by 2.2% compared to the third quarter of 2011. Performance during the third quarter reflects strength across the segment's product lines, in particular, the Company's QX100™ Droplet Digital™ PCR system as well as shipments of process chromatography media. Strong sales in North America were offset by slowness in Europe and Japan. In September, Bio-Rad introduced the TC20™ automated cell counter, the next generation of the Company's TC10™ automated cell counter that provides accurate and reliable counts of live mammalian cells in 30 seconds. Also during the quarter, Bio-Rad acquired an automated benchtop cell sorting system from Propel Labs. First shipments of the S3™ Cell Sorter are anticipated in January 2013.

Clinical Diagnostics
Reported net sales for the Clinical Diagnostics segment in the third quarter were $328.4 million, down 3.8% compared to the third quarter in 2011. On a currency-neutral basis, sales were up 4.5%. During the quarter, the Clinical Diagnostics segment had growth across most product lines most notably from quality controls, diabetes and immunohematology products, as well as the BioPlex® 2200 system. Strength in the Pacific Rim, the U.S., and Eastern Europe were offset by weakness in Western Europe.

Management will discuss these results in a conference call at 2 PM Pacific Time (5 PM Eastern Time) November 6, 2012. Interested parties may access the call by dialing 866-730-5764 (in the U.S.) or 857-350-1588 (international), access number 44911474.

A live webcast of the conference call may be accessed in the "Investor Relations" section of 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 48801274, for seven days following the call. The webcast of the call will be archived on the Bio-Rad site for on-demand replay for up to a year and may be accessed in the "Investor Relations" section of www.bio-rad.com.

About Bio-Rad
Bio-Rad Laboratories, Inc. (NYSE: BIO) and (NYSE: BIO.B) has remained at the center of scientific discovery for more than 50 years, manufacturing and distributing a broad range of products for the life science research and clinical diagnostic markets. The Company is renowned worldwide among hospitals, universities, major research institutions, as well as biotechnology and pharmaceutical companies for its commitment to quality and customer service. Founded in 1952, Bio-Rad is headquartered in Hercules, California, and serves more than 100,000 research and industry customers worldwide through its global network of operations. The Company employs over 7,000 people globally and had revenues exceeding $2 billion in 2011. For more information, visit www.bio-rad.com.

This release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally can be identified by the use of forward-looking terminology such as, "believe," "expect," "may," "will," "intend," "estimate," "continue," or similar expressions or the negative of those terms or expressions. Such statements involve risks and uncertainties, which could cause actual results to vary materially from those expressed in or indicated by the forward-looking statements. For further information regarding the Company's risks and uncertainties, please refer to the "Risk Factors" in the Company's public reports filed with the Securities and Exchange Commission, including the Company's most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. The Company cautions you not to place undue reliance on forward-looking statements, which reflect an analysis only and speak only as of the date hereof. Bio-Rad Laboratories, Inc., disclaims any obligation to update these forward-looking statements.

                                                                            
                         Bio-Rad Laboratories, Inc.                         
                Condensed Consolidated Statements of Income                 
                                                                            
                   (in thousands, except per share data)                    
                                (UNAUDITED)                                 
                                                                            
                               Three Months Ended       Nine Months Ended   
                                  September 30,           September 30,     
                             ----------------------  ---------------------- 
                                2012        2011        2012        2011    
                             ----------  ----------  ----------  ---------- 
Net sales                    $  498,697  $  516,514  $1,495,396  $1,523,291 
  Cost of goods sold            225,187     220,338     655,404     656,368 
                             ----------  ----------  ----------  ---------- 
Gross profit                    273,510     296,176     839,992     866,923 
                                                                            
  Selling, general and                                                      
   administrative expense       160,274     176,867     493,823     521,370 
  Research and development                                                  
   expense                       49,004      45,387     154,263     136,327 
                             ----------  ----------  ----------  ---------- 
Income from operations           64,232      73,922     191,906     209,226 
                                                                            
  Interest expense               11,901      12,341      37,498      41,148 
  Foreign exchange losses,                                                  
   net                              448       6,346       3,508      12,132 
  Other (income) expense,                                                   
   net                           (1,511)       (538)    (14,692)     (5,907)
                             ----------  ----------  ----------  ---------- 
Income before income taxes       53,394      55,773     165,592     161,853 
                                                                            
  Provision for income taxes    (11,023)     (9,911)    (43,712)    (43,031)
                             ----------  ----------  ----------  ---------- 
Net income including                                                        
 noncontrolling interests        42,371      45,862     121,880     118,822 
                                                                            
  Net loss (income)                                                         
   attributable to                                                          
   noncontrolling interests          13          35        (148)        162 
                             ----------  ----------  ----------  ---------- 
Net income attributable to                                                  
 Bio-Rad                     $   42,384  $   45,897  $  121,732  $  118,984 
                             ==========  ==========  ==========  ========== 
                                                                            
Basic earnings per share:                                                   
  Net income per share basic                                                
   attributable to Bio-Rad   $     1.50  $     1.63  $     4.31  $     4.25 
                             ==========  ==========  ==========  ========== 
                                                                            
  Weighted average common                                                   
   shares - basic                28,312      28,072      28,255      27,997 
                             ==========  ==========  ==========  ========== 
                                                                            
Diluted earnings per share:                                                 
  Net income per share                                                      
   diluted attributable to                                                  
   Bio-Rad                   $     1.48  $     1.61  $     4.26  $     4.18 
                             ==========  ==========  ==========  ========== 
                                                                            
  Weighted average common                                                   
   shares - diluted              28,645      28,456      28,609      28,454 
                             ==========  ==========  ==========  ========== 
                                                                            
                                                                            
                                                                            
                         Bio-Rad Laboratories, Inc.                         
                    Condensed Consolidated Balance Sheets                   
                                                                            
                               (in thousands)                               
                                                                            
                                                 September 30,  December 31,
                                                      2012          2011    
                                                 ------------- -------------
                                                  (UNAUDITED)               
Current assets:                                                             
  Cash and cash equivalents                      $     426,457 $     574,231
  Short-term investments                               427,164       238,884
  Accounts receivable, net                             375,800       398,674
  Inventories, net                                     458,428       433,510
  Other current assets                                 157,592       152,856
                                                 ------------- -------------
    Total current assets                             1,845,441     1,798,155
                                                                            
Property, plant and equipment, net                     397,949       349,501
Goodwill, net                                          489,355       468,933
Purchased intangibles, net                             268,866       259,497
Other assets                                           301,405       220,717
                                                 ------------- -------------
    Total assets                                 $   3,303,016 $   3,096,803
                                                 ============= =============
                                                                            
                                                                            
Current liabilities:                                                        
  Accounts payable                               $     113,282 $     129,124
  Accrued payroll and employee benefits                129,690       112,564
  Notes payable and current maturities of long-                             
   term debt                                               306           814
  Income and other taxes payable                        30,396        52,285
  Other current liabilities                            159,992       164,328
                                                 ------------- -------------
    Total current liabilities                          433,666       459,115
                                                                            
Long-term debt, net of current maturities              732,233       731,698
Other long-term liabilities                            201,635       161,608
                                                 ------------- -------------
    Total liabilities                                1,367,534     1,352,421
                                                                            
Bio-Rad stockholders' equity                         1,934,882     1,743,937
Noncontrolling interests                                   600           445
                                                 ------------- -------------
    Total stockholders' equity                       1,935,482     1,744,382
                                                 ------------- -------------
    Total liabilities and stockholders' equity   $   3,303,016 $   3,096,803
                                                 ============= =============
                                                                            

                                                                            
                                                                            
                         Bio-Rad Laboratories, Inc.                         
              Condensed Consolidated Statements of Cash Flows               
                                                                            
                               (in thousands)                               
                                (UNAUDITED)                                 
                                                                            
                                                       Nine Months Ended    
                                                         September 30,      
                                                                            
                                                       2012         2011    
                                                   -----------  ----------- 
                                                                            
Cash flows from operating activities:                                       
  Cash received from customers                     $ 1,512,991  $ 1,508,934 
  Cash paid to suppliers and employees              (1,231,537)  (1,249,674)
  Interest paid                                        (35,929)     (46,086)
  Income tax payments                                  (73,784)     (38,029)
  Other operating activities                             8,503        6,094 
                                                   -----------  ----------- 
  Net cash provided by operating activities            180,244      181,239 
                                                                            
Cash flows from investing activities:                                       
  Payments for acquisitions and long-term                                   
   investments                                         (38,479)      (8,698)
  Other investing activities                          (302,285)    (205,191)
                                                   -----------  ----------- 
  Net cash used in investing activities               (340,764)    (213,889)
                                                                            
Cash flows from financing activities:                                       
  Payments on long-term borrowings                        (496)    (226,615)
  Other financing activities                             9,569       14,788 
                                                   -----------  ----------- 
  Net cash provided by (used in) financing                                  
   activities                                            9,073     (211,827)
                                                                            
Effect of foreign exchange rate changes on cash          3,673        8,954 
                                                   -----------  ----------- 
                                                                            
Net decrease in cash and cash equivalents             (147,774)    (235,523)
Cash and cash equivalents at beginning of period       574,231      906,551 
                                                   -----------  ----------- 
Cash and cash equivalents at end of period         $   426,457  $   671,028 
                                                   ===========  =========== 
                                                                            
                                                                            
Reconciliation of net income including                                      
 noncontrolling interests to net cash provided by                           
 operating activities:                                                      
                                                                            
Net income including noncontrolling interests      $   121,880  $   118,822 
Adjustments to reconcile net income including                               
 noncontrolling interests to net cash provided by                           
 operating activities:                                                      
  Depreciation and amortization                         94,885       88,127 
  Changes in working capital                           (32,271)     (49,450)
  Other                                                 (4,250)      23,740 
                                                   -----------  ----------- 
Net cash provided by operating activities          $   180,244  $   181,239 
                                                   ===========  =========== 
                                                                            

For more information contact:
Christine Tsingos
Vice President and Chief Financial Officer
Ron Hutton
Treasurer
Bio-Rad Laboratories, Inc.
510-724-7000
Email Contact


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