Bio-Rad Laboratories Reports Second-Quarter Financial Results
HERCULES, Calif., Aug. 5 /PRNewswire-FirstCall/ -- Bio-Rad
Laboratories, Inc. (Amex: BIO; BIOb), a multinational manufacturer
and distributor of life science research products and clinical
diagnostics, announced financial results today for the second
quarter ended June 30, 2004. Second quarter net sales from
continuing operations were $260.5 million, up 8.9 percent compared
to the $239.3 million reported for the same quarter of 2003. This
increase was primarily the result of organic growth in the
Company's main business segments as well as currency effects. For
the quarter, income from continuing operations was $20.3 million
compared to $21.9 million in the second quarter of last year. In
May, the Company sold its U.K. based confocal microscopy product
line to Carl Zeiss Jena GMBH. As required by SFAS 144, the sales
and expenses related to this product line for current and prior
periods have been reclassified to a separate line on the income
statement titled "Discontinued operations." Net sales for the first
half of 2004 grew by 9.1 percent to $523.3 million compared to the
same period last year. At 57.1 percent, gross margin for the first
half of 2004 was down slightly compared to 57.5 percent in the same
period of 2003. However, at 57.4 percent, second-quarter gross
margin was markedly higher than the 56.4 percent reported for the
second quarter of 2003. This improvement was a result of the
Company's product mix skewing toward consumables as well as the
elimination of some low margin products. Income from continuing
operations for the six-month period was $42.9 million, or $1.67 per
share, an 11.8 percent decrease compared to the $48.6 million, or
$1.92 per share, reported in the corresponding period of last year.
This reduction was largely due to anticipated spending on
infrastructure improvements. Second Quarter Highlights * Overall
net sales for the second quarter grew by 8.9 percent to reach
$260.5 million compared to $239.3 million reported in the second
quarter of 2003. On a currency-neutral basis, revenues were up 4.2
percent versus second-quarter 2003 results. * Basic earnings from
continuing operations were $0.79 per share, or $0.76 per share on a
diluted basis, compared to basic earnings per share of $0.86 and
diluted earnings per share of $0.83 in the same period of 2003. *
Life Science segment net sales for the quarter were $113.9 million,
3.4 percent higher than the comparable period last year. On a
currency neutral basis, segment sales declined by 1.3 percent for
the quarter. Overall performance in the Life Science segment was
negatively impacted by increased competition in certain
instrumentation businesses and the timing of shipments in the
process chromatography business. Solid performers in this segment
included the multiplex protein array technology, amplification
reagents, and electrophoresis product lines. * The Clinical
Diagnostics segment reported net sales of $144.4 million for the
quarter, up 13.4 percent compared to the second quarter of 2003, or
8.8 percent excluding currency effects. These results were the
result of growth in several areas including autoimmune testing,
quality-control management and diabetes monitoring, as well as the
addition of acquired Hematronix products to the quality controls
portfolio. Moreover, sales of Bio-Rad's Platelia(TM) Aspergillus
EIA test kit in the United States and Canada gained momentum, in
part due to the Company's co-marketing agreement with Enzon
Pharmaceuticals, Inc. * During the quarter, the Company granted a
worldwide, non-exclusive sublicense to OraSure Technologies, Inc.
under patents relating to the Human Immunodeficiency Virus, Type 2,
or HIV-2. "While our life science market is experiencing modest
growth to date, we are anticipating the introduction of several
very interesting new products in the coming months," said Norman
Schwartz, President and Chief Executive Officer. "This, coupled
with the recent introduction of the Bio-Plex(TM)2200 to the
diagnostic market, should provide good momentum during the second
half of the year." Management will discuss these results in a
conference call at 2:00 p.m. PT (5:00 p.m. ET) August 5, 2004.
Interested parties can access the call by dialing 800-901-5218 (in
the U.S.), or 617-786-4511 (international), access number 89936051.
The live web cast can be accessed at http://www.bio-rad.com/ . A
replay of the call will be available at 888-286-8010 (in the U.S.),
or 617-801-6888 (international), access number 73327988, for seven
days following the call and the web cast can be accessed at
http://www.bio-rad.com/ for 30 days. Bio-Rad Laboratories, Inc. is
a multinational manufacturer and distributor of life science
research products and clinical diagnostics. It is based in
Hercules, California, and serves more than 70,000 research and
industry customers worldwide through a network of more than 30
wholly owned subsidiary offices. Various statements made within
this press release may constitute "forward- looking statements" for
purposes of the Securities and Exchange Commission's "safe harbor"
provisions under the Private Securities Litigation Reform Act of
1995 and Rule 3b-6 under the Securities Exchange Act of 1934. The
forward- looking statements contained herein involve risks and
uncertainties that could cause results to differ materially from
the Company's expectations. Bio-Rad Laboratories, Inc. Second
Quarter 2004 Condensed Consolidated Statements of Income (In
thousands, except per share data) (UNAUDITED) Three Months Ended
Six Months Ended June 30, June 30, 2004 2003 2004 2003 Net sales
$260,546 $239,325 $523,295 $479,723 Cost of goods sold 110,885
104,265 224,370 203,985 Gross profit 149,661 135,060 298,925
275,738 Selling, general and administrative expense 90,199 76,947
177,256 152,269 Product research and development expense 25,545
21,990 49,878 42,601 Purchased in-process research and development
expense -- -- 900 -- Interest expense 4,919 3,696 9,969 8,347
Foreign exchange losses, net 545 554 747 1,323 Other (income)
expense, net (866) (880) (650) (1,484) Income from continuing
operations before taxes 29,319 32,753 60,825 72,682 Provision for
income taxes (9,048) (10,834) (17,934) (24,050) Income from
continuing operations 20,271 21,919 42,891 48,632 Discontinued
operations Discontinued operations (net of tax) (845) (963) (1,487)
(1,312) Gain on divestiture (net of tax) 3,437 -- 3,437 -- Total
discontinued operations 2,592 (963) 1,950 (1,312) Net income
$22,863 $20,956 $44,841 $47,320 Basic earnings per share Continuing
operations $0.79 $0.86 $1.67 $1.92 Discontinued operations 0.10
(0.03) 0.08 (0.05) Net income $0.89 $0.83 $1.75 $1.87 Weighted
average common shares 25,699 25,386 25,662 25,336 Diluted earnings
per share Continuing operations $0.76 $0.83 $1.62 $1.86
Discontinued operations 0.10 (0.03) 0.07 (0.05) Net income $0.86
$0.80 $1.69 $1.81 Adjusted weighted average shares 26,504 26,341
26,474 26,214 Bio-Rad Laboratories, Inc. Summary Condensed
Consolidated Balance Sheets (In thousands) (UNAUDITED) At June 30,
At December 31, 2004 2003 Current assets: Cash and cash equivalents
$155,329 $148,642 Accounts receivable, net 234,003 234,085
Inventories, net 188,564 190,258 Prepaid expenses, taxes and other
current assets 82,491 97,893 Total current assets 660,387 670,878
Net property, plant and equipment 186,233 179,123 Goodwill, net
72,741 69,503 Other assets 103,399 67,354 Total assets $1,022,760
$986,858 Current liabilities: Notes payable and current maturities
of long-term debt $9,987 $10,423 Accounts payable 67,340 53,995
Accrued payroll and employee benefits 59,464 71,650 Sales, income
and other taxes payable 12,634 20,833 Other current liabilities
61,712 77,425 Total current liabilities 211,137 234,326 Long-term
debt, net of current maturities 226,098 225,835 Deferred tax
liabilities 15,962 13,991 Other long-term liabilities 25,043 16,899
Stockholders' equity 544,520 495,807 Total liabilities and
stockholders' equity $1,022,760 $986,858 Certain items have been
reclassified to conform to the current year presentation. Bio-Rad
Laboratories, Inc. Summary Condensed Consolidated Statement of Cash
Flows (In thousands) (UNAUDITED) Period Ended June 30, 2004 2003
Cash flows from operating activities: Cash received from customers
$517,385 $499,425 Cash paid to suppliers and employees (440,664)
(409,833) Interest paid (9,866) (9,164) Income tax payments
(20,860) (31,632) Miscellaneous receipts (payments) 3,568 (149)
Discontinued operations (2,019) (2,055) Net cash provided by
operating activities 47,544 46,592 Cash flows from investing
activities: Capital expenditures, net (29,057) (25,368) Other
investing activities (16,378) (14,908) Net cash used in investing
activities (45,435) (40,276) Cash flows from financing activities:
Long-term borrowings 0 10,835 Payments on long-term debt (212)
(18,109) Other financing activities 3,465 6,002 Net cash provided
by (used in) financing activities 3,253 (1,272) Effect of exchange
rate changes on cash 1,325 (3,949) Net increase in cash and cash
equivalents 6,687 1,095 Cash and cash equivalents at beginning of
period 148,642 27,733 Cash and cash equivalents at end of period
$155,329 $28,828 Reconciliation of income from continuing
operations to net cash provided by operating activities: Income
from continuing operations $42,891 $ 48,632 Adjustments to
reconcile net income to net cash provided by operating activities:
Depreciation and amortization 22,881 20,495 Changes in working
capital (19,540) (37,131) Other 2,799 15,908 Discontinued
operations (1,487) (1,312) Net cash provided by operating
activities $47,544 $46,592 Certain items have been reclassified to
conform to the current year presentation. DATASOURCE: Bio-Rad
Laboratories, Inc. CONTACT: Christine Tsingos, Vice President and
Chief Financial Officer, or Ron Hutton, Treasurer, both of Bio-Rad
Laboratories, Inc., +1-510-724-7000, or Web site:
http://www.bio-rad.com/
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