Acquisitions, Operational Improvements and Organic Growth Drive Results
Conference Call To Be Held at 11:00 AM ET Today
HOLLISTON, Mass., Feb. 26, 2015 (GLOBE NEWSWIRE) -- Harvard Bioscience, Inc. (Nasdaq:HBIO), a global developer, manufacturer and marketer of a broad range of solutions to advance life science, reported financial highlights for the fourth quarter and full year ended December 31, 2014. The Company reported record quarterly revenues with other increases including operating income, operating margins, gross margins, income from continuing operations and net income.
Jeffrey A. Duchemin, President and Chief Executive Officer of Harvard Bioscience, said, “We continued to make significant progress in all of our key operating metrics. Of particular note this quarter, we grew non-GAAP earnings per diluted share by 100% to $0.10, revenues increased 11.0%, excluding the impact of currency translation, and we significantly improved our operating margins, which increased by 580 basis points to 15.5% on a non-GAAP basis. Bookings remained strong this quarter, increasing almost 7% to $30.4 million, compared with bookings of $28.5 million during last year’s fourth quarter, and backlog improved 41% to $7.2 million compared with last year’s fourth quarter backlog of $5.1 million.”
He continued, “The fourth quarter wrapped up a very fulfilling and exciting year for our Company. Fourth quarter results were driven by organic growth, operational improvements and contributions from the Multi Channel Systems MCS GmbH and Triangle BioSystems, Inc. acquisitions we completed during the quarter. These successes were all made possible by our new strategy and new management philosophy that we began to put into place toward the end of 2013, under which our talented employees are executing on a global basis.
“We expect these newly acquired companies, combined with our recent acquisition of HEKA Electronik during the first quarter 2015, to further contribute toward our organic growth as our sales team offers a complete set of electrophysiology solutions to our customers.”
He concluded, “In 2014, we put together the building blocks of a solid foundation that we believe will continue to deliver value for our shareholders. We look forward to another great year.”
Fourth Quarter Reported Results
Revenues for the three months ended December 31, 2014 were $30.4 million, an increase of approximately 9.0%, or $2.5 million compared to revenues of $27.9 million for the three months ended December 31, 2013. Excluding currency translation, revenues increased 11.0% or $3.1 million. The increase was the result of revenues from the newly acquired Multi Channel Systems MCS GmbH (“MCS”) and Triangle BioSystems, Inc. (“TBSI”) and organic growth. For a reconciliation of changes in revenues, refer to Exhibit 8 below.
Income from continuing operations, as measured under U.S. generally accepted accounting principles (“GAAP”), was a loss of $19,000, or $0.00 per diluted share, for the three months ended December 31, 2014 compared to a loss of $255,000, or $0.01 per diluted share, for the same quarter in 2013. Overall, the favorable year-to-year quarterly GAAP earnings comparison was due primarily to an increase in revenues and gross profit, and lower operating expenses, partially offset by acquisition costs and higher income tax expense. Included within operating expenses is a gain of approximately $760,000 on the sale of one of our manufacturing facilities for which related operations were consolidated into one of our other manufacturing facilities earlier in 2014. Additionally, included within income tax expense was the recording of a $1.3 million valuation allowance for certain tax credit carry-forwards.
Income from continuing operations, on a non-GAAP basis, increased 97% to $3.3 million for the fourth quarter 2014, and increased 100% to $0.10 per diluted share, compared to $1.7 million, and $0.05 per diluted share, for the three months ended December 31, 2013. For a reconciliation between the GAAP and non-GAAP income from continuing operations, refer to Exhibit 5 and 6 below. Overall, the favorable year-to-year quarterly non-GAAP earnings comparison was due primarily to an increase in revenues and gross profit. Included within operating expenses is a gain of approximately $760,000 on the sale of one of our manufacturing facilities for which related operations were consolidated into one of our other manufacturing facilities earlier in 2014.
Year-to-Date Reported Results
Revenues for the year ended December 31, 2014 were $108.7 million, an increase of approximately 3.3%, or $3.5 million compared to revenues of $105.2 million for the year ended December 31, 2013. Excluding currency translation, revenues increased 2.4%, or $2.5 million. The increase was the result of revenues from the newly acquired MCS and TBSI and organic growth. For a reconciliation of changes in revenues, refer to Exhibit 8 below.
Income from continuing operations, as measured under GAAP, was $2.4 million, or $0.07 per diluted share, for the year ended December 31, 2014 compared to $0.7 million, or $0.02 per diluted share, for the same period in 2013. Overall, the favorable year-to-year GAAP earnings comparison was due primarily to an increase in revenues and gross profit, and lower operating expenses, partially offset by acquisition costs and higher income tax expense. Included within operating expenses is a gain of approximately $760,000 on the sale of one of our manufacturing facilities for which related operations were consolidated into one of our other manufacturing facilities earlier in 2014. Additionally, included within income tax expense was the recording of a $1.3 million valuation allowance for certain tax credit carry-forwards.
Income from continuing operations, on a non-GAAP basis, increased 26% to $8.9 million for the year ended December 31, 2014, and increased 21% to $0.27 per diluted share, compared to $7.1 million, and $0.22 per diluted share, for the year ended December 31, 2013. For a reconciliation between the GAAP and non-GAAP income from continuing operations, refer to Exhibit 5 and 6 below. Overall, the favorable year-to-year non-GAAP earnings comparison was due primarily to an increase in revenues and gross profit, and lower operating expenses. Included within operating expenses is a gain of approximately $760,000 on the sale of one of our manufacturing facilities for which related operations were consolidated into one of our other manufacturing facilities earlier in 2014.
Financial Guidance
The Company is providing financial guidance for the full year 2015. The guidance includes the expected negative impact of currency translation due to the strengthening of the U.S. dollar, expected costs of relocation and consolidation of certain facilities, and contributions from its recent acquisitions.
The Company expects revenues to be approximately $114 million to $116 million. Included in this guidance is the Company’s expectation that currency translation will lower revenues by between $6 million and $7 million, based on current foreign currency exchange rates. On a constant currency basis, the Company expects revenues to be approximately $120 million to $123 million, or a 10% to 13% increase compared to 2014 revenues.
The Company expects to report full-year 2015 non-GAAP earnings per share of $0.27 to $0.28, based upon its forecasted weighted shares outstanding of 34.5 million. This translates to GAAP diluted earnings per share of approximately $0.16 to $0.17. Included in this guidance is the Company’s expectation that currency translation will lower non-GAAP EPS by approximately $0.02 per diluted share. On a constant currency basis, the Company expects non-GAAP EPS to be approximately $0.29 to $0.30 per diluted share, or a 7% to 11% increase compared to 2014 non-GAAP EPS.
Included in the above guidance is the Company’s expectation that it will incur costs of approximately $750,000 to $1 million, or approximately $0.02 per diluted share, on a non-GAAP basis to relocate and consolidate certain manufacturing and distribution facilities in 2015. The Company expects that its actions to relocate and consolidate these facilities will result in savings of approximately $750,000 to $1 million annually beginning in 2016.
The Company may incur charges, realize gains or experience other events in 2015 that could cause actual results to vary from this guidance. Refer to Exhibit 7 below for a reconciliation between the GAAP and non-GAAP diluted earnings per share guidance.
Conference Call Details
As previously announced, management will host a conference call to discuss fourth quarter and full-year 2014 results and business highlights and outlook, which will be simultaneously webcast and can be accessed through the Harvard Bioscience, Inc. website. The conference call will begin at 11:00 a.m. ET today, February 26, 2015. To listen to the conference call, log on to our website at www.harvardbioscience.com and click on the Earnings Call icon.
The live conference call is also accessible by dialing the following phone numbers: toll-free 877-303-7611, or international: 970-315-0445, and referencing the pass code 71470115.
Financial information presented on the call, including the earnings release, will also be available on the investor relations section of the website.
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