Gross profit margin (adjusted) declined 70 basis points to 46.6%, compared to third quarter 2006. Higher distribution costs and a decline in margin on life science products were primarily responsible. Diagnostics product margins were flat with prior year quarter reflecting overall stable pricing trends.
R&D investment, excluding the license acquired in 2006 for $27.5 million, ramped up $6.5 million, or 12.2% over prior year quarter. The increase in R&D investment was largely directed at the development of the company's previously announced sample-to-result system for molecular diagnostics, the UniCel(R) DxN, slated for commercialization in 2010.
Reported operating income was $67.5 million. In the third quarter, the company recorded a $3 million charge in connection with the previously announced closure and relocation of several facilities. On an adjusted basis, operating income was $70.5 million, down 5% compared to third quarter 2006. The decline in operating income in the quarter was primarily driven by the increase in R&D investment and the decline in profit contribution from life science products.
Non-operating income of $10.8 million included a $26.2 million gain on the sale of vacant land in Miami. From these proceeds, the company made a $9 million contribution in the quarter to establish the Beckman Coulter Foundation. This new foundation will benefit research and educational institutions and programs. Adjusted non-operating expense, excluding these two items, was $6.4 million in the quarter, compared to $13.1 million in the third quarter of 2006. The lower expense was due primarily to currency gains.
The effective tax rate in the quarter was 25.4% reflecting certain
|SOURCE Beckman Coulter, Inc.|
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