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Immucor Announces Fiscal Third Quarter Results

NORCROSS, Ga., April 6 /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 third quarter ended February 28, 2009.

Financial Highlights

  • Revenue for the fiscal third quarter of 2009 was $75.3 million, up 12% from $67.0 million in the same period last year.
  • Gross margin was 71.4% in the quarter, compared with 72.1% in the prior year quarter.
  • Net income in the quarter was $19.5 million, compared with $19.3 million for the same quarter last year.
  • Diluted earnings per share totaled $0.27 in the quarter, compared with $0.27 for the same period last year.
  • Cash flow from operations for the nine months ended February 28, 2009 was $54.0 million, compared with $54.1 million in the prior year period.

"We are pleased with the stability of our performance given the current economic environment," stated Dr. Gioacchino De Chirico, Immucor's President and Chief Executive Officer. "The demand for our reagent products, which account for nearly 90% of our total revenue, has remained stable as shown by our earnings and our cash flow."

Nine-Month Results

For the first nine months of fiscal 2009, revenue was $221.5 million, compared with $192.6 million in the prior year period. Gross margin was 72.6%, up from 70.7% in the prior year period. Net income was $56.8 million, or $0.80 per fully diluted share, compared with $53.2 million, or $0.75 per fully diluted share in the prior year period.

Selected Product Revenue and Gross Margin

                                    ($ amounts in thousands)
                          Fiscal Q3 2009     Fiscal Q3 2008        Variance
                                   Gross               Gross
                         Revenue   Margin   Revenue    Margin       $      %

    Traditional reagents $50,628    78.1%   $45,713     79.5%    $4,915   11%
    Capture reagents      15,390    84.0%    14,167     85.6%     1,223    9%
    Instruments            8,426    12.2%     7,149    (2.0)%     1,277   18%

Consolidated revenue was $75.3 million in the current year quarter, an increase of approximately $8.3 million, or 12%, over the third quarter of fiscal 2008. Reagent price increases and increased instrument revenue in the United States market as well as increased sales of reagents outside of the U.S. accounted for the majority of the revenue increase. Revenue in the quarter was negatively impacted by approximately $1.7 million from foreign currency translation as compared with the third quarter of fiscal 2008.

Consolidated gross margin was $53.8 million, or 71.4% of revenue, in the current year quarter compared with $48.3 million, or 72.1% of revenue, in the prior year quarter. Consolidated gross margin was negatively impacted by higher than normal manufacturing variances, which included the disposal of certain inventory related to our transfer of production from Houston to Norcross, Ga.

Operating Expenses

Operating expenses for the third quarter increased approximately $5.2 million, or 27%, 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 the United Kingdom markets.

Summary of Instrument Orders

                                           Q3 2009 Orders         Cumulative
    Instrument                    N.A.(1)    ROW(2)     Total      Orders (3)
    Echo                           70         18         88           518
    Galileo                         5         20         25           627

    (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

For the first three quarters of fiscal 2009, the Company received 264 Echo orders and 53 Galileo orders. Of the cumulative orders since the instruments' launch, approximately 269 Echo orders and 573 Galileo orders were generating reagent revenue as of the end of the fiscal 2009 third quarter, an increase of 76 Echo instruments and 14 Galileo instruments in the quarter.

"We believe that the need to address staff shortages and to prioritize patient safety will continue to drive long-term demand for our Echo instrument in the small-to-medium hospital segment. We believe we will be near our 350 Echo order target for fiscal 2009, despite the increased pressure our customers are experiencing due to the current economic climate," stated Dr. De Chirico. "We expect to be at, or slightly above, the top end of our previous estimate of between 50 and 60 Galileo orders for the year."

2009 Guidance

The Company continues to expect fiscal 2009 revenue in the range of $292 million to $300 million and gross margins in the range of 71.0% to 73.0%. During the fourth quarter, the Company expects to spend between $1.5 million and $2.0 million on a quality process improvement project, which will negatively impact fourth quarter gross margins. Including these expenses, the Company expects full year diluted earnings per share to be at, or modestly above, the upper end of its previous guidance range of $0.97 to $1.02.

Conference Call

Immucor, Inc. will host a conference call Tuesday, April 7, 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). 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 12:00 PM on April 7, 2009 by calling 1-866-373-9229 (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 2009 revenue projections, gross margin projections, fully diluted earnings per share projections and order projections for the Echo and Galileo instruments. 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 outcome and costs associated with the Company's quality process improvement project; 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 development of an automated instrument for the molecular immunohematology products produced by BioArray; regulatory obstacles including obstacles in securing regulatory approval of the BioArray system; 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 FTC investigation; 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 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 February 28, 2009. Immucor assumes no obligation to update any forward-looking statements.

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

                                     Three Months Ended    Nine Months Ended
                                      Feb. 28,  Feb. 29,   Feb. 28,   Feb. 29,
                                        2009      2008       2009       2008

    NET SALES                         $75,309   $67,029   $221,506   $192,585
    COST OF SALES                      21,520    18,688     60,734     56,489
    GROSS PROFIT                       53,789    48,341    160,772    136,096

     Research and development           2,777     1,522      7,553      5,011
     Selling and marketing              9,355     7,605     29,537     23,019
     Distribution                       3,309     2,881     10,326      8,212
     General and administrative         7,979     7,228     22,905     19,385
     Restructuring expense                  -       (77)         -        646
     Amortization expense and other     1,071        88      2,667        261
       Total operating expenses        24,491    19,247     72,988     56,534

    INCOME FROM OPERATIONS             29,298    29,094     87,784     79,562

     Interest income                      427     1,260      1,808      3,504
     Interest expense                     (42)     (111)      (245)      (292)
     Other, net                          (312)      (14)    (1,964)        73
       Total non-operating income
        (expense)                          73     1,135       (401)     3,285

    INCOME BEFORE INCOME TAXES         29,371    30,229     87,383     82,847
    PROVISION FOR INCOME TAXES          9,914    10,963     30,632     29,667
    NET INCOME                        $19,457   $19,266    $56,751    $53,180

    Earnings per share:
         Per common share - basic       $0.28     $0.28      $0.81      $0.76
         Per common share - diluted     $0.27     $0.27      $0.80      $0.75
    Weighted average shares
         Basic                         70,406    69,991     70,361     69,792
         Diluted                       71,145    71,113     71,195     71,100

                                  IMMUCOR, INC.
                            (Unaudited, in thousands)

                                       February 28,        May 31,
                                           2009             2008

    Cash                                 $113,425         $175,056
    Accounts receivable - trade            56,258           52,720
    Inventory                              35,607           32,228
    Total current assets                  213,892          271,575
    Property and equipment - net           40,108           36,426
    Total assets                          417,543          364,950

    Accounts payable                        9,220            7,546
    Deferred revenue, current portion      10,748           11,146
    Total current liabilities              44,125           41,019
    Deferred revenue, long-term portion    12,428           13,010
    Other liabilities                       3,418            3,225
    Shareholders' equity                  357,572          307,696

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

                                                        Nine Months Ended
                                                   February 28,   February 29,
                                                      2009           2008

      Net income                                     $56,751         $53,180
      Adjustments to reconcile net income to net
       cash provided by operating activities:
       Depreciation and amortization                   9,582           6,182
       Share-based compensation expense                3,749           3,041
       Deferred income taxes                           1,453          (3,038)
       Excess tax benefit from share-based
        compensation                                  (4,347)         (6,629)
       Other                                           1,135             769
      Changes in operating assets and
       liabilities, net of effects from acquired
       companies                                     (14,290)            589
    Cash provided by operating activities             54,033          54,094

      Purchases of property and equipment             (6,088)         (8,562)
      Acquisition of businesses, net of
       cash acquired                                (108,659)              -
    Cash used in investing activities               (114,747)         (8,562)

      Repayments of long-term debt and
       liabilities                                      (213)           (310)
      Repurchase of common stock                      (5,644)         (5,549)
      Proceeds from exercise of stock options          3,107           2,180
      Excess tax benefit from share-based
       compensation                                    4,347           6,629
    Cash provided by financing activities              1,597           2,950

     AND CASH EQUIVALENTS                             (2,514)          1,818
     CASH EQUIVALENTS                                (61,631)         50,300
     BEGINNING OF PERIOD                             175,056         113,551
    CASH AND CASH EQUIVALENTS AT END OF PERIOD      $113,425        $163,851

SOURCE Immucor, Inc.
Copyright©2009 PR Newswire.
All rights reserved

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