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Immucor Announces Fiscal Second Quarter Results; Raises Fiscal 2009 EPS Guidance

NORCROSS, Ga., Jan. 7 /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 second quarter ended November 30, 2008.

Financial Highlights

-- Revenue for the fiscal second quarter of 2009 was $73.0 million, up 18% from $61.9 million in the same period last year.

-- Gross margin was 73.3% in the quarter, compared with 67.6% in the prior year quarter.

-- Net income in the quarter was $17.3 million, up from $16.2 million for the same quarter last year.

-- Diluted earnings per share totaled $0.24 in the quarter, compared with $0.23 for the same period last year.

-- During the quarter, the Company repurchased 200,000 shares of its common stock at a total cost of $4.7 million under its stock repurchase program.

"Our second quarter results demonstrate the strength of our business model with its strong recurring revenue and cash flow," stated Dr. Gioacchino De Chirico, President and Chief Executive Officer. "We have what I believe to be the leading technology for automating the blood bank, which positions us well as the market moves towards automation."

Six-Month Results

For the first six months of fiscal 2009, revenue was $146.2 million, compared with $125.6 million in the prior year period. Gross margin was 73.2%, up from 69.9% in the prior year period. Net income was $37.3 million, or $0.52 per fully diluted share, compared with $33.9 million, or $0.48 per fully diluted share in the prior year period. Cash flow from operations was $32.3 million for the first six months of fiscal 2009, compared with $26.6 million for the first six months of fiscal 2008.

    Revenue and Gross Margin by Product

                                            ($ amounts in thousands)
                         Fiscal Q2 2009      Fiscal Q2 2008       Variance

                                  Gross               Gross
                       Revenue    Margin   Revenue    Margin      $       %
     reagents          $47,229    80.8 %   $43,024    74.7 %   $4,205    10 %
     reagents           16,524    84.6 %    12,239    84.4 %    4,285    35 %
    Instruments          8,609    13.0 %     6,471    (7.8)%    2,138    33 %
     immunohematology      659    43.1 %         -       -        659   100 %
    Collagen                 -        -        190   (57.4)%     (190) (100)%
     revenue           $73,021     73.3 %  $61,924    67.6 %  $11,097    18 %

Consolidated revenue increased approximately $11.1 million, or 18%, over the second quarter of fiscal 2008, driven by both price and instrument volume increases in the United States as well as increased sales outside of the U.S. U.S. price increases accounted for approximately two-thirds of the total consolidated revenue increase. Revenue in the quarter was negatively impacted by approximately $1.1 million from foreign currency translation as compared with the second quarter of fiscal 2008.

The year-over-year improvement in consolidated gross margins was driven by price increases in the U.S. as well as instrument product mix with fewer sales that required the instrument to be expensed at time of sale.

Operating Expenses

Operating expenses for the second quarter increased approximately $7.2 million, or 39%, over the prior year quarter primarily attributable to the BioArray acquisition as well as investments being made in the French and the United Kingdom markets to sell our products directly to the end user.

    Summary of Instrument Orders

                                     Q2 2009 Orders            Cumulative
    Instrument               N.A.(1)       ROW(2)     Total     Orders(3)
    Echo                       31            21        52          430
    Galileo                     1            15        16          602

    (1) N.A. - North America (the U.S. and Canada)
    (2) ROW - all parts of the world other than North America.

(3) Cumulative Orders - total orders received since the launch of the instrument.

"On a year-to-date basis, we have received 176 Echo orders, which demonstrates the tremendous market acceptance of our instrument," stated Dr. De Chirico. "Of the cumulative 430 Echo orders, approximately 193 were generating reagent revenue, which is an increase of 64 instruments in the quarter."

Raising 2009 EPS Guidance

The Company continues to expect revenue for the fiscal year ending May 31, 2009, to range from $292 million to $300 million, unchanged from the Company's previous estimate. Gross margin is now expected to be in the range of 71.0% to 73.0%, compared with the Company's previous guidance of 70.0% to 71.0%. Fully diluted earnings per share are now expected to be in the range of $0.97 to $1.02 for the fiscal year, compared with the Company's previous estimate of $0.94 to $0.98.

"In summary, our business is doing well in this troubled economic environment because of our strong product offering as well as our strong balance sheet and cash flow," stated Dr. De Chirico. "I am pleased with our projected performance for the remainder of fiscal 2009."

Conference Call

Immucor, Inc. will host a conference call Thursday, January 8, 2009 at 8:30 AM (Eastern Time) to review these results. Investors are invited to participate in this conference call with Dr. Gioacchino De Chirico, President and Chief Executive Officer; Richard A. Flynt, Chief Financial Officer; and Edward L. Gallup, consultant.

To participate in the telephone conference call, dial 1-888-324-7567, passcode BLUD. A replay of the conference call will be available for one week beginning at 12:00 PM on January 8, 2009 by calling 1-866-457-5510, passcode 2468. 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.

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

Statements contained in this press release that are not statements of historical fact 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 2009 revenue, gross margin and fully diluted earnings per share projections. 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: 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 increase costs; the inability of customers to efficiently integrate our 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; the unexpected loss of any key managers; changes in interest 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 FTC investigation; lower than expected market acceptance of the molecular diagnostic products produced by BioArray; 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, 2008, and its Form 10-Q for the quarter ended August 31, 2008. Immucor assumes no obligation to update any forward-looking statements.

                                IMMUCOR, INC.
               (Unaudited, in thousands except per share data)

                                Three Months Ended        Six Months Ended
                           November 30, November 30, November 30, November 30,
                               2008         2007         2008         2007

    NET SALES                 $ 73,021     $ 61,924    $ 146,197   $ 125,556

    COST OF SALES               19,463       20,050       39,214      37,802

    GROSS PROFIT                53,558       41,874      106,983      87,754

      Research and development   2,896        1,434        4,777       3,489
      Selling and marketing     10,713        7,844       20,182      15,413
      Distribution               3,549        2,646        7,017       5,330
      General and
       administrative            7,467        6,278       14,925      12,158
      Restructuring expense          -          192            -         723
      Amortization expense and
       other                     1,071           87        1,596         173
        Total operating
         expenses               25,696       18,481       48,497      37,286

    INCOME FROM OPERATIONS      27,862       23,393       58,486      50,468

      Interest income              586        1,131        1,380       2,244
      Interest expense             (77)         (86)        (203)       (181)
      Other, net                (1,230)         268       (1,650)         87
        Total non-operating
         (expense) income         (721)       1,313         (473)      2,150

    INCOME BEFORE INCOME TAXES  27,141       24,706       58,013      52,618
    PROVISION FOR INCOME TAXES   9,803        8,542       20,718      18,704
    NET INCOME                $ 17,338     $ 16,164     $ 37,295    $ 33,914

    Earnings per share:
      Per common share - basic   $0.25        $0.23        $0.53       $0.49
      Per common share - diluted $0.24        $0.23        $0.52       $0.48
    Weighted average shares
      Basic                     70,409       69,954       70,338      69,693
      Diluted                   71,227       71,111       71,219      71,094

                                IMMUCOR, INC.
                          (Unaudited, in thousands)

                                        November 30,   May 31,
                                            2008        2008

    Cash                                   $92,302    $175,056
    Accounts receivable - trade             55,817      52,720
    Inventory                               34,528      32,228
    Total current assets                   192,515     271,575
    Property and equipment - net            38,154      36,426
    Total assets                           395,463     364,950

    Accounts payable                         8,182       7,546
    Total current liabilities               43,504      41,019
    Other liabilities                       16,151      16,235
    Shareholders' equity                   335,808     307,696

                        IMMUCOR, INC. AND SUBSIDIARIES
                          (Unaudited, in thousands)

                                                        Six Months Ended
                                                    November 30, November 30,
                                                        2008         2007
      Net income                                      $ 37,295     $ 33,914
      Adjustments to reconcile net income to
       net cash provided by operating activities:
        Depreciation and amortization                    6,313        4,063
        Share-based compensation expense                 2,478        2,032
        Deferred income taxes                              850       (3,031)
        Excess tax benefit from share-based
         compensation                                   (2,880)      (6,279)
        Other                                              579          347
      Changes in operating assets and liabilities,
       net of effects from acquired companies          (12,327)      (4,436)
    Cash provided by operating activities               32,308       26,610

      Purchases of property and equipment               (3,602)      (5,711)
      Acquisition of businesses, net of cash acquired (108,537)           -
    Cash used in investing activities                 (112,139)      (5,711)

      Repayments of long-term debt and liabilities        (229)        (233)
      Repurchase of common stock                        (5,644)      (5,539)
      Proceeds from exercise of stock options            2,452        1,794
      Excess tax benefit from share-based compensation   2,880        6,279
    Cash (used in) provided by financing activities       (541)       2,301

     EQUIVALENTS                                        (2,382)       1,027
     EQUIVALENTS                                       (82,754)      24,227
     PERIOD                                            175,056      113,551
    CASH AND CASH EQUIVALENTS AT END OF PERIOD        $ 92,302    $ 137,778

SOURCE Immucor, Inc.
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