MINNEAPOLIS, Oct. 25, 2011 /PRNewswire/ -- Techne Corporation's (NASDAQ: TECH) financial results for the quarter ended September 30, 2011 include the following highlights:
Consolidated net sales and earnings for the quarter ended September 30, 2011 were impacted by the acquisition of Boston Biochem, Inc. (Boston Biochem) on April 1, 2011 and Tocris Holdings Limited (Tocris) on April 28, 2011, including the cost recognized upon the sale of inventory that was written-up to fair value as part of the acquisitions and increased amortization of acquired intangible assets. Consolidated net sales for the quarter ended September 30, 2011 includes $5.6 million of sales from the acquired companies.
A weaker U.S. dollar as compared to foreign currencies improved sales by $1.9 million in the quarter ended September 30, 2011 from the comparable prior-year period.
The Biotechnology segment includes sales made through R&D Systems' Biotechnology Division, R&D Systems Europe, Tocris, R&D Systems China, BiosPacific and Boston Biochem. Biotechnology net sales were $72.3 million, an increase of 14.7% from $63.0 million for the quarter ended September 30, 2010. Biotechnology growth was 2.8% for the quarter ended September 30, 2011 if the sales from the acquisitions and foreign currency benefit are excluded.
Customer sales growth for the Biotechnology segment, excluding sales from products of the acquired entities, from the same prior-year period include:Quarter EndedSeptember 30, 2011R&D Systems Biotechnology Division:Industrial, pharmaceutical and biotechnology
(2.5%)Pacific Rim distributors
11.6%In constant currency
24.0%In constant currency
14.1%Hematology net sales for the quarter ended September 30, 2011 were $5.3 million, an increase of 7.9% from the comparable prior-year period.
The gross margin percentage declined to 75.2% in the quarter ended September 30, 2011 from 77.4% in the comparable prior-year quarter due to the cost recognized upon the sale of the inventory that was written-up to fair value as part of the acquisitions and amortization of acquired intangible assets. Gross margins were 79.0% and 77.6% the quarters ended September 30, 2011 and 2010, respectively, if such costs and amortization are excluded in both periods.
Selling, general and administrative expenses for the quarter ended September 30, 2011 increased $3.2 million from the quarter ended September 30, 2010. The acquisitions added $1.6 million of selling, general and administrative expenses in the quarter, excluding intangible amortization that increased $461,000 in the quarter. The increase in selling, general and administrative expense for the quarter was also impacted by increased profit sharing expense of $885,000 for the quarter.
The effective tax rate for the quarter ended September 30, 2011 was 32.0% as compared to 32.3% for the same prior-year period. Effective tax rates for fiscal 2012 are expected to be 31% to 33%.
Forward Looking Statements:
Our press releases may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Such statements, including the expected effective tax rate, involve risks and uncertainties that may affect the actual results of operations. The following important factors, among others, have affected and, in the future, could affect the Company's actual results: the integration of the acquired companies, the introduction and acceptance of new biotechnology and hematology products, the levels and particular directions of research by the Company's customers, the impact of the growing number of producers of biotechnology research products and related price competition, general economic conditions, the retention of hematology OEM and proficiency survey business, the impact of currency exchange rate fluctuations, and the costs and results of research and product development efforts of the Company and of companies in which the Company has invested or with which it has formed strategic relationships.
For additional information concerning such factors, see the section titled "Risk Factors" in the Company's annual report on Form 10-K and quarterly reports on Form 10-Q as filed with the Securities and Exchange Commission. We undertake no obligation to update or revise any forward-looking statements we make in our press releases due to new information or future events. Investors are cautioned not to place undue emphasis on these statements.
Use of Adjusted Financial Measures:
The adjusted financial measures used in this press release quantify the impact the following had on reported net sales, gross margin percentages, selling, general and administrative expenses, net earnings and earnings per share for the quarter year ended September 30, 2011 as compared to the reported amounts for the same period ended September 30, 2010:
These adjusted financial measures are not prepared in accordance with generally accepted accounting principles (GAAP) and may be different from adjusted financial measures used by other companies. Adjusted financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. We view these adjusted financial measures to be helpful in assessing the Company's ongoing operating results. In addition, these adjusted financial measures facilitate our internal comparisons to historical operating results and comparisons to competitors' operating results. We include these adjusted financial measures in our earnings announcement because we believe they are useful to investors in allowing for greater transparency related to supplemental information we use in our financial and operational analysis. Investors are encouraged to review the reconciliations of adjusted financial measures used in this press release to their most directly comparable GAAP financial measures as provided with the financial statements attached to this press release.
Techne Corporation has two operating subsidiaries: Research and Diagnostic Systems, Inc. (R&D Systems) of Minneapolis, Minnesota and R&D Systems Europe, Ltd. (R&D Europe) of Abingdon, England. R&D Systems is a specialty manufacturer of biological products. R&D Systems has four subsidiaries, BiosPacific, Inc. (BiosPacific), located in Emeryville, California, Boston Biochem, Inc., located in Cambridge, Massachusetts, R&D Systems China Co. Ltd., (R&D China), located in Shanghai, China and Tocris Cookson, Inc, located in Saint Louis, Missouri. BiosPacific is a worldwide supplier of biologics to manufacturers of in vitro diagnostic systems and immunodiagnostic kits. Boston Biochem is a leading developer and manufacturer of ubiquitin-related research products. R&D China and R&D Europe distribute biotechnology products. R&D Europe has two subsidiaries, Tocris Holding, Ltd (Tocris) of Bristol, England and R&D Systems GmbH, a German sales operation. Tocris is a leading supplier of reagents for non-clinical life science research.
CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands, except per share data)
$67,945Cost of sales
52,595Operating expenses: Selling, general and administrative
7,613Research and development
6,619Total operating expenses
38,363Other income (expense): Interest income
847 Other non-operating expense, net
(257)Total other (expense) income
590Earnings before income taxes
$26,373Earnings per share: Basic
$ 0.71 Diluted
$ 0.71Weighted average common shares outstanding: Basic
CONSOLIDATED BALANCE SHEETS
6/30/11Cash and equivalents
$ 77,613Short-term available-for-sale investments
63,200Trade accounts receivable
44,906Other current assets
6,838 Current assets
131,988Property and equipment, net
95,398Goodwill and intangible assets, net
138,915Other non-current assets
20,952 Total assets
$617,670LIABILITIES AND STOCKHOLDERS' EQUITYCurrent liabilities
$ 18,188Deferred taxes
586,122 Total liabilities and stockholders' equity
RECONCILIATION of ORGANIC SALES
$67,945Organic sales adjustments:Acquisitions
0Impact of foreign currency fluctuations
RECONCILIATION of NET EARNINGS and EARNINGS per SHARE
(In thousands, except per share data)
$26,373Identified adjustments:Costs recognized upon sale of acquired inventory
0Amortization of intangibles
170Tax impact of adjustments
107Net earnings – Adjusted for identified items
$26,480Earnings per share – Diluted – Adjusted
$ 0.71TECHNE CORPORATION
RECONCILIATION of GROSS MARGIN PERCENTAGES
9/30/10Gross margin percentage
77.4%Identified adjustments:Costs recognized upon sale of acquired inventory
0.0%Amortization of intangibles
0.2%Gross margin percentage – Adjusted
RECONCILIATION of SELLING, GENERAL and ADMINISTRATIVE EXPENSES
9/30/10Selling, general and administrative expenses
$7,613Identified selling, general and administrative expense adjustments:Acquired companies' expense, excluding intangible amortization
0Amortization of intangibles
(61)Selling, general and administrative expenses – Adjusted
RECONCILIATION to INTANGIBLE AMORTIZATION
9/30/10Amortization of intangible assets was included in:Cost of goods sold
$109Selling, general and administrative expenses
61Total amortization of intangible assets
|SOURCE Techne Corporation|
Copyright©2010 PR Newswire.
All rights reserved