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Immucor Announces Fiscal Fourth Quarter Results

NORCROSS, Ga., July 23 /PRNewswire-FirstCall/ -- Immucor, Inc. (Nasdaq: BLUD), a global leader in providing automated instrument-reagent systems to the blood transfusion industry, today reported financial results for the fiscal fourth quarter ended May 31, 2009.

Fourth Quarter Financial Highlights

  • Revenue for the fiscal fourth quarter of 2009 was $79.0 million, up 15% from $68.6 million in the same period last year.
  • Gross margin was 69.9% in the quarter, compared with 72.0% in the prior year quarter. Current quarter gross margin included expenses of approximately $1.8 million related to the Quality Process Improvement Project.
  • Net income in the quarter was $19.4 million, compared with $18.3 million for the same quarter last year.
  • Diluted earnings per share totaled $0.27 in the quarter, compared with $0.26 for the same period last year. The current year quarter included the impact from the Quality Process Improvement Project of approximately $0.02 per diluted share, net of tax.
  • The current year quarter included the results of BioArray Solutions, which was acquired on August 4, 2008.

Full Year Results

  • For fiscal 2009, revenue was $300.5 million, up 15% from $261.2 million in the prior year.
  • Gross margin was 71.9%, up from 71.0% in the prior year. Full year gross margin included expenses related to the Quality Process Improvement Project of approximately $2.4 million.
  • Net income was $76.2 million, or $1.07 per diluted share, compared with $71.5 million, or $1.00 per diluted share in the prior year. Fiscal 2009 included expenses related to the Quality Process Improvement Project of approximately $0.02 per diluted share, net of tax.
  • Cash flow from operations for the year ended May 31, 2009 was $79.8 million, compared with $75.1 million in the prior year.
  • The current year financials included 10 months of results for BioArray.

"For fiscal 2009, we achieved record revenue, earnings and cash flow from operations," stated Dr. Gioacchino De Chirico, Immucor's President and Chief Executive Officer. "Our growth has been driven by the success of our automation strategy combined with the fact that our reagent product offering is necessary to ensure the safety of transfusions."

    Selected Product Revenue and Gross Margin
                                        ($ amounts in thousands)
                       Fiscal Q4 2009     Fiscal Q4 2008          Growth

                                 Gross                Gross
                     Revenue     Margin    Revenue    Margin    $       %
     reagents         $52,149    75.3%    $45,274     77.4%  $6,875    15%
    Capture reagents   17,057    84.1%     15,027     86.5%   2,030    14%
    Instruments         9,058    18.0%      8,312     16.0%     746     9%

Consolidated revenue was $79.0 million in the current year quarter, an increase of approximately $10.4 million, or 15%, over the fourth quarter of fiscal 2008. Revenue in the quarter benefited from both price and volume contributions. Revenue in the quarter was negatively impacted by approximately $3.0 million from foreign currency translation as compared with the fourth quarter of fiscal 2008.

Consolidated gross margin was $55.2 million, or 69.9% of revenue, in the current year quarter compared with $49.4 million, or 72.0% of revenue, in the prior year quarter. During the current year quarter, gross margin was negatively impacted by costs related to the Company's Quality Process Improvement Project, which focuses on improving the quality department's processes and procedures.

"Our Quality Process Improvement Project is progressing well and we continue to target a project completion date by the end of our third fiscal quarter of 2010," stated Dr. De Chirico. "We are confident that our efforts will produce a world-class quality system that will be the foundation for the future."

Operating Expenses

Operating expenses for the fourth quarter increased approximately $4.9 million, or 23%, over the prior year quarter primarily attributable to the BioArray acquisition as well as the Company's initiative to sell its products directly to the end user in the French and United Kingdom markets.

    Summary of Instrument Orders

                                    Q4 2009 Orders                Cumulative
    Instrument                  N.A. (1)     ROW(2)      Total     Orders (3)
    Echo                            65          20         85           603
    Galileo                          1           9         10           637

       (1) N.A. - North America (the U.S. and Canada)
       (2) ROW - all parts of the world other than the U.S. and Canada
       (3) Cumulative Orders - total orders received since the launch of the

For fiscal 2009, the Company received 349 Echo orders and 63 Galileo orders. Of the cumulative orders since the instruments' launch, approximately 360 Echo orders and 596 Galileo orders were generating reagent revenue at their expected annualized run rate as of May 31, 2009, an increase of 91 Echo instruments and 23 Galileo instruments in the fiscal fourth quarter.

"The market's acceptance of our Echo instrument, which is targeted at the small- to medium-sized hospital segment, has been remarkable. In the first 2 years since launch, we achieved more than 600 orders, which represents approximately 10% of our estimated addressable worldwide market," stated Dr. De Chirico.

"We expect to launch our next generation Galileo instrument, the Galileo Neo(TM), in early 2010. Targeted at high volume customers, the Galileo Neo is our fourth generation automated instrument," stated Dr. De Chirico. "We have the newest instrumentation on the market and believe that both Immucor and our customers benefit from our automation strategy."

Fiscal 2010 Guidance

The Company continues to expect fiscal 2010 consolidated revenue in the range of $322 million to $332 million and consolidated gross margins in the range of 70.0% to 71.5%. The Company's Quality Process Improvement Project is included in cost of goods sold. The Company continues to expect expenses related to the project in fiscal 2010 to be in the range of $4.0 million to $4.5 million.

The Company continues to expect diluted earnings per share to be in the range of $1.10 to $1.17 for fiscal 2010, which includes the approximately $0.04 per share impact, net of tax, related to the Quality Process Improvement Project. The Company's fiscal 2010 guidance also includes a full year of BioArray expenses. BioArray was acquired on August 4, 2008.

"We believe in our opportunities for long-term sustainable growth and will continue to focus on the business to produce results that provide returns for both our customers and our shareholders," stated Dr. De Chirico.

Conference Call

Immucor, Inc. will host a conference call Friday, July 24, 2009 at 8:30 AM (Eastern Time) to review these results. To participate in the telephone conference call, dial 1-888-324-9321 (Passcode: BLUD). The Company will also provide a live audio broadcast of the call via webcast. The webcast can be accessed at in the "About Us - Investor Information" section by selecting the webcast link. For those unable to listen to the live broadcast of the call, a replay will be available shortly after completion of the call and will be archived on Immucor's website for approximately 60 days. Additionally, a replay of the call will be available for one week beginning at noon on July 24, 2009 by calling 1-866-453-1998 (Passcode: 2583).

About Immucor

Founded in 1982, Immucor manufactures and sells a complete line of reagents and systems used by hospitals, reference laboratories and donor centers to detect and identify certain properties of the cell and serum components of blood prior to transfusion. Immucor markets a complete family of automated instrumentation for all of its market segments. For more information on Immucor, please visit our website at

Safe Harbor Statement

This press release contains statements that are "forward-looking statements" as that term is defined under federal securities laws. Forward-looking statements contained in this press release include the intent, belief or current expectations of the Company and members of its management team with respect to the Company's future business operations as well as the assumptions upon which such statements are based. Forward-looking statements include specifically, but are not limited to: fiscal 2010 revenue projections, gross margin projections, fully diluted earnings per share projections and Quality Process Improvement Project projections, including projected expenses and completion date. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance, and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. In addition, results for one fiscal quarter are not necessarily indicative of results for any future period. Factors that could cause actual results to differ materially from those expressed in any forward-looking statement include, but are not limited to: the outcome and costs associated with the Company's Quality Process Improvement Project; the outcome of the administrative action ("notice of intent to revoke our biological license") received by the FDA; customer reaction to the FDA action and the subsequent impact on the business; lower than expected demand for the Company's instruments; the decision of customers to defer capital spending; the unexpected change in the mix of instruments being purchased instead of acquired through other means, which could significantly change costs recognized in the period; the inability of customers to efficiently integrate the Company's instruments into their blood banking operations; increased competition in the sale of instruments and reagents, particularly in North America; unanticipated operational problems that result in non-compliance with FDA regulations; the failure to effectively integrate BioArray operations into the Company's overall operations; product development obstacles including obstacles related to the Galileo Neo as well as the next generation automated instrument for the molecular immunohematology products; regulatory obstacles including obstacles in securing regulatory approval of the BioArray technology; the inability to hire and retain, and the unexpected loss of key managers; changes in interest rates; fluctuations in foreign currency conversion rates; the strengthening of the U.S. Dollar versus any of the functional currencies in which the Company operates and its adverse impact on reported results; the inability of the Company's Japanese, French and United Kingdom subsidiaries to attain expected revenue, gross margin and net income levels; the outcome of any legal claims or regulatory investigations known or unknown, including the ongoing investigations by the Department of Justice and Federal Trade Commission, and related customer class action lawsuits; the Company's inability to protect its intellectual property or its infringement of the intellectual property of others; lower than expected market acceptance of the molecular immunohematology products; the unexpected application of different accounting rules; general economic conditions; and adverse developments with respect to the operation or performance of the Company, its products and its affiliates or the market price of its common stock. Additional factors that could cause actual results to differ materially from those contemplated within this Press Release can be found in the Company's Risk Factor disclosures in its Form 10-K for the year ended May 31, 2009. Immucor assumes no obligation to update any forward-looking statements.

                                      IMMUCOR, INC.
                     (unaudited, in thousands except per share data)
                                     Three Months Ended      Year Ended
                                     May 31,   May 31,   May 31,   May 31,
                                      2009      2008      2009      2008
    NET SALES                        $79,041   $68,614  $300,547  $261,199
    COST OF SALES                     23,802    19,221    84,536    75,710
    GROSS PROFIT                      55,239    49,393   216,011   185,489

      Research and development         3,144     1,443    10,698     6,454
      Selling and marketing            9,654     9,951    39,191    32,970
      Distribution                     3,383     3,183    13,708    11,394
      General and administrative       8,813     6,540    31,717    25,925
      Restructuring expense                -        -          -       646
      Amortization expense and other   1,072        96     3,739       357
        Total operating expenses      26,066    21,213    99,053    77,746

    INCOME FROM OPERATIONS            29,173    28,180   116,958   107,743

      Interest income                    149       759     1,957     4,263
      Interest expense                    (5)      (79)     (250)     (371)
      Other, net                         281       (39)   (1,684)       33
        Total non-operating income
         (expense)                       425       641        23     3,925

    INCOME BEFORE INCOME TAXES        29,598    28,821   116,981   111,668
    PROVISION FOR INCOME TAXES        10,166    10,547    40,798    40,214
    NET INCOME                       $19,432   $18,274   $76,183   $71,454

    Earnings per share:
         Per common share - basic      $0.28     $0.26     $1.08     $1.02
         Per common share - diluted    $0.27     $0.26     $1.07     $1.00
    Weighted average shares
         Basic                        70,447    70,090    70,382    69,867
         Diluted                      71,055    71,119    71,168    71,109

                                  IMMUCOR, INC.
                            (Unaudited, in thousands)
                                          May 31,           May 31,
                                           2009              2008

    Cash                                 $136,461          $175,056
    Accounts receivable - trade            57,017            52,720
    Inventory                              38,256            32,228
    Total current assets                  244,850           271,575
    Property and equipment - net           43,461            36,426
    Total assets                          451,340           364,950

    Accounts payable                        9,344             7,546
    Deferred revenue, current
     portion                               11,222            11,146
    Total current liabilities              52,288            41,019
    Deferred revenue, long-term
     portion                               10,871            13,010
    Other liabilities                       3,603             3,225
    Shareholders' equity                  384,578           307,696

                             IMMUCOR, INC. AND SUBSIDIARIES
                                (Unaudited, in thousands)
                                                       Years Ended
                                                  May 31,           May 31,
                                                   2009              2008
      Net income                               $   76,183         $  71,454
      Adjustments to reconcile net income to
       net cash provided by operating
        Depreciation and amortization              13,306             8,376
        Share-based compensation expense            5,904             3,678
        Deferred income taxes                           5            (1,751)
        Excess tax benefit from share-based
         compensation                              (3,253)           (7,539)
        Other                                       1,200              (804)
      Changes in operating assets and liabilities,
       net of effects from acquired companies     (13,523)            1,691
    Cash provided by operating activities          79,822            75,105

      Purchases of property and equipment          (8,602)          (11,573)
      Acquisition of businesses, net of cash
       acquired                                  (107,954)                -
      Other                                             -            (4,120)
    Cash used in investing activities            (116,556)          (15,693)

      Repayments of long-term debt and liabilities   (206)           (4,652)
      Repurchase of common stock                   (7,621)           (5,549)
      Proceeds from exercise of stock options       3,178             2,734
      Excess tax benefit from share-based
       compensation                                 3,253             7,539
    Cash (used in) provided by financing
     activities                                    (1,396)               72

     EQUIVALENTS                                     (465)            2,021
     EQUIVALENTS                                  (38,595)           61,505
     PERIOD                                       175,056           113,551
    CASH AND CASH EQUIVALENTS AT END OF PERIOD $  136,461         $ 175,056

SOURCE Immucor, Inc.
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