Largely the result of a favorable product mix that included a greater percentage of diagnostic products, Neogen's gross margin increased to 53.4% of sales in its first quarter of the current year, compared to 51.4% of sales in its FY 2009 first quarter. Neogen's operating income for the first quarter equaled 21.5% of the company's quarterly revenues.
"As our consolidated balance sheet data shows, we had an exceptional quarter generating cash, and we now have more than $23 million in cash and investments to pursue a wide variety of growth strategies," said Richard Current, Neogen's chief financial officer. "Our inventories are down in comparison to our prior quarter, as we continue our progress in controlling the level of inventories without impacting sales. Our accounts receivable have increased slightly, but at a pace less than our sales increase. We continue to monitor the financial health of our customers to avoid collection concerns, and have yet to experience significant receivable problems."
Neogen's Food Safety and Animal Safety Divisions posted nearly identical 12% revenue increases in the first quarter compared to the prior year's first quarter. The food safety sales increase was entirely organic, while the year-over-year animal safety increase benefited from the July 2008 acquisition of DuPont cleaners and disinfectants, and the May 2009 acquisition of International Diagnostic Systems (IDS). Acquired IDS products include a number of drug detection diagnostics. Company-wide, Neogen's organic sales grew approximately 9% in the quarter compared to the prior year's first quarter.
The company's quarterly food safety sales improvement w
|SOURCE Neogen Corporation|
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