HBIO Reports Second Quarter 2009 Results
Second Quarter Reported Results
Revenues from the Company's continuing operations for the three months ended
Non-GAAP adjusted income from continuing operations was
Year-to-Date Reported Results
Revenues from the Company's continuing operations for the six months ended
Non-GAAP adjusted income from continuing operations was
The Company ended the second quarter of 2009 with a strong balance sheet. We had net cash (cash and cash equivalents, net of debt) totaling
See Exhibits 4 and 5 of this press release for reconciliations of GAAP income from continuing operations to non-GAAP adjusted income from continuing operations and GAAP diluted earnings per common share from continuing operations to non-GAAP adjusted diluted earnings per common share from continuing operations.
Chane Graziano, CEO, stated, "Our earnings results for the second quarter of 2009 were consistent with our expectations although revenue was somewhat lower than expected. The stronger dollar, tough year-to-year comparisons and weakness in the economy were the major influences on our revenue. As we look to the second half of the year, we are much more optimistic because:
- June and July saw a strong pickup in orders, particularly at Harvard Apparatus,
- we have a larger than usual backlog of orders, including orders for a new advanced microliter spectrophotometer, which we expect will be shipping in the third quarter of 2009,
- we expect to see a favorable impact from our program of continued productivity improvements from cost reductions and business consolidations, and
- we expect to see the effect of the NIH stimulus package, particularly in the fourth quarter of 2009."
Mr. Graziano continued, "However, in view of our revenues during the first half of the year, we are narrowing our guidance on non-GAAP adjusted diluted earnings per share for 2009 to
Our updated revenue guidance was calculated using exchange rates (
Reconciliation of Guidance for Non-GAAP Adjusted Diluted Earnings per
Common Share From Continuing Operations to US GAAP Diluted
Earnings per Common Share From Continuing Operations
(unaudited)
Three Months Ended Year Ended
September 30, 2009 December 31, 2009
Low High Low High
Estimate Estimate Estimate Estimate
Non-GAAP adjusted diluted
earnings per common share
from continuing
operations - A $ 0.06 $ 0.07 $ 0.27 $ 0.31
Less the impact of:
Amortization of intangible
assets (0.01) (0.01) (0.06) (0.06)
Stock-based compensation
(SFAS No. 123(R)) (0.02) (0.02) (0.07) (0.07)
Restructuring (0.01) (0.01) (0.02) (0.02)
Tax - B 0.01 0.01 0.04 0.04
-------- -------- -------- --------
GAAP diluted earnings per
common share from
continuing
operations - A $ 0.03 $ 0.04 $ 0.16 $ 0.20
======== ======== ======== ========
A - Assumes no additional acquisitions.
B - Tax impact of above items and utilization of deferred tax
assets that have full valuation allowances.
Operating Results for Continuing Operations
Three months ended
Revenues decreased
Cost of product revenues decreased
Sales and marketing expenses decreased
General and administrative expenses decreased
Research and development expenses were
Six months ended
Revenues decreased
Cost of product revenues decreased
Sales and marketing expenses decreased
General and administrative expenses decreased
Research and development expenses were
Balance Sheet
The Company ended the second quarter of 2009 with cash and cash equivalents of
Trade receivables were
The Company spent
Restructuring
During the quarter ended
We recorded additional restructuring charges in our Scie-Plas, Biochrom and Hoefer businesses related to the 2009 restructuring plan of approximately
During the quarter ended
Discontinued Operations
In
Conference Call Details
As previously announced, management will host a conference call to discuss second quarter 2009 results and business highlights and outlook, which will be simultaneously broadcast over the Internet and can be accessed through the
Use of Non-GAAP Financial Information
In this press release, we have included non-GAAP financial information including adjusted operating income from continuing operations, adjusted income from continuing operations and adjusted earnings per diluted share from continuing operations. We believe that this non-GAAP financial information provides investors with an enhanced understanding of the underlying operations of the business. For the periods presented, these non-GAAP financial measures of income have excluded certain expenses primarily resulting from purchase accounting or events that we do not believe are related to the underlying operations of the business such as amortization of intangibles related to acquisitions, fair value adjustments of inventory and backlog related to acquisitions, asset write-down expenses, costs related to acquisition initiatives, restructuring expenses (including related inventory write-downs), discontinued operations and stock-based compensation expense. They also exclude the tax impact of the reconciling items and the utilization of deferred tax assets that have full valuation allowances. This non-GAAP financial information approximates information used by our management to internally evaluate the operating results of the Company. Tabular reconciliations of our non-GAAP adjusted income from continuing operations and earnings per diluted share from continuing operations for the three and six months ended
The non-GAAP financial information provided in this press release should be considered in addition to, not as a substitute for, the financial information provided and presented in accordance with GAAP.
About
The
This press release contains, and our conference call may contain, forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words "guidance," "objectives," "optimistic," "potential," "expects," "plans," "estimates," "projects," "intends," "believes," "goals," "sees," and similar expressions that do not relate to historical matters. Forward-looking statements in this press release or that may be made during our conference call may include, but are not limited to, statements or inferences about the Company's or management's beliefs or expectations, the Company's anticipated future revenues and earnings, the strength of the Company's market position and business model, the impact of acquisitions or potential acquisitions, the outlook for the life sciences industry, the Company's business strategy, the positioning of the Company for growth, the market demand and opportunity for the Company's products, and the Company's plans, objectives and intentions that are not historical facts.
These statements involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that may cause the Company's actual results to differ materially from those in the forward-looking statements include the Company's failure to identify potential acquisition candidates, successfully negotiate favorable pricing and other items with acquisition candidates to enable potential acquisitions to close, successfully integrate acquired businesses or technologies, complete consolidations of business functions, expand its product offerings, introduce new products or commercialize new technologies, including our new micro liter spectrophotometer and electrophoresis products, unanticipated costs relating to acquisitions, unanticipated costs arising in connection with the Company's consolidation of business functions, decreased demand for the Company's products due to changes in its customers' needs, financial position, general economic outlook or other circumstances, overall economic trends, the seasonal nature of purchasing in
For investor inquiries, please call (508) 893-8066. Press releases may be found on our web site, http://www.harvardbioscience.com.
EXHIBIT #1
HARVARD BIOSCIENCE, INC.
Selected Consolidated Balance Sheet Information
(Unaudited, in thousands)
June 30, Dec. 31,
2009 2008
-------- --------
Assets
Cash and cash equivalents $ 16,801 $ 13,698
Trade receivables 11,294 15,086
Inventories 13,542 11,901
Property, plant and equipment 3,351 3,221
Goodwill and other intangibles 34,334 33,782
Other assets 3,256 3,583
-------- --------
Total assets $ 82,578 $ 81,271
======== ========
Liabilities and Stockholders' Equity
Total current liabilities 9,188 11,215
Total liabilities 12,639 14,553
Stockholders' equity 69,939 66,718
Total liabilities and -------- --------
stockholders' equity $ 82,578 $ 81,271
======== ========
EXHIBIT #2
HARVARD BIOSCIENCE, INC.
Consolidated Statements of Operations
(In thousands, except per share data)
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2009 2008 2009 2008
-------- -------- -------- --------
Revenues $ 18,049 $ 23,049 $ 37,121 $ 45,008
Cost of product
revenues 9,107 12,286 18,769 23,920
-------- -------- -------- --------
Gross profit 8,942 10,763 18,352 21,088
-------- -------- -------- --------
Sales and marketing
expenses 2,688 2,969 5,060 5,810
General and
administrative
expenses 3,552 3,795 6,869 7,551
Research and
development
expenses 1,089 1,077 2,088 2,158
Restructuring charges 422 943 449 1,518
Amortization of
intangible assets 386 505 730 1,011
-------- -------- -------- --------
Total operating
expenses 8,137 9,289 15,196 18,048
-------- -------- -------- --------
Operating income 805 1,474 3,156 3,040
-------- -------- -------- --------
Other income (expense):
Foreign exchange (375) (37) (299) 156
Interest expense (34) (89) (79) (219)
Interest income 6 126 13 204
Other, net (55) 24 (2) 78
-------- -------- -------- --------
Other income
(expense), net (458) 24 (367) 219
-------- -------- -------- --------
Income from continuing
operations before
income taxes 347 1,498 2,789 3,259
Income taxes 66 445 669 989
-------- -------- -------- --------
Income from
continuing operations 281 1,053 2,120 2,270
Loss from discontinued
operations, net of tax -- (3,259) -- (3,789)
-------- -------- -------- --------
Net income (loss) $ 281 $ (2,206) $ 2,120 $ (1,519)
======== ======== ======== ========
Income (loss) per
share:
Basic earnings per
common share from
continuing
operations $ 0.01 $ 0.03 $ 0.07 $ 0.07
Discontinued
operations -- (0.11) -- (0.12)
-------- -------- -------- --------
Basic earnings per
common share $ 0.01 $ (0.07) $ 0.07 $ (0.05)
======== ======== ======== ========
Diluted earnings per
common share from
continuing
operations $ 0.01 $ 0.03 $ 0.07 $ 0.07
Discontinued
operations -- (0.10) -- (0.12)
-------- -------- -------- --------
Diluted earnings
per common share $ 0.01 $ (0.07) $ 0.07 $ (0.05)
======== ======== ======== ========
Weighted average
common shares:
Basic 29,602 30,971 29,806 30,923
======== ======== ======== ========
Diluted 29,819 31,608 29,969 31,527
======== ======== ======== ========
EXHIBIT #3
HARVARD BIOSCIENCE, INC.
Reconciliation of US GAAP Operating Income from Continuing
Operations to Non-GAAP Adjusted Operating Income from
Continuing Operations
(in thousands)
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2009 2008 2009 2008
------- ------- ------- -------
US GAAP operating income $ 805 $ 1,474 $ 3,156 $ 3,040
Adjustments:
Amortization of intangible
assets 386 505 730 1,011
Inventory writedown due to
restructuring 64 (6) 92 252
Restructuring charges 422 1,043 449 1,624
Stock-based compensation
expense 658 570 970 1,000
------- ------- ------- -------
Non-GAAP adjusted operating
income $ 2,335 $ 3,586 $ 5,397 $ 6,927
======= ======= ======= =======
EXHIBIT #4
HARVARD BIOSCIENCE, INC.
Reconciliation of US GAAP Income from Continuing Operations to
Non-GAAP Adjusted Income from Continuing Operations
(in thousands)
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2009 2008 2009 2008
------- ------- ------- -------
US GAAP income from
continuing operations $ 281 $ 1,053 $ 2,120 $ 2,270
Adjustments:
Amortization of intangible
assets 386 505 730 1,011
Inventory writedown due to
restructuring 64 (6) 92 252
Direct acquisition costs 53 -- 53 --
Restructuring charges 422 1,043 449 1,624
Stock-based compensation
expense 658 570 970 1,000
Income taxes (A) (493) (701) (868) (1,230)
------- ------- ------- -------
Non-GAAP adjusted income
from continuing operations $ 1,371 $ 2,464 $ 3,546 $ 4,927
======= ======= ======= =======
(A) Income taxes includes the tax effect of adjusting for the
reconciling items and the utilization of deferred tax assets that
have full valuation allowances.
EXHIBIT #5
HARVARD BIOSCIENCE, INC.
Reconciliation of US GAAP Diluted Earnings Per Common Share from
Continuing Operations to Non-GAAP Adjusted Diluted Earnings Per
Common Share from Continuing Operations
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2009 2008 2009 2008
-------- -------- -------- --------
US GAAP diluted earnings per
common share from continuing
operations $ 0.01 $ 0.03 $ 0.07 $ 0.07
Adjustments:
Amortization of intangible
assets 0.01 0.02 0.02 0.03
Inventory writedown due to
restructuring 0.00 0.00 0.00 0.01
Direct acquisition costs 0.00 0.00 0.00 0.00
Restructuring charges 0.01 0.03 0.02 0.05
Stock-based compensation
expense 0.02 0.02 0.03 0.03
Income Taxes (A) (0.01) (0.02) (0.03) (0.04)
-------- -------- -------- --------
Non-GAAP adjusted diluted
earnings per common share
from continuing operations $ 0.05 $ 0.08 $ 0.12 $ 0.16
======== ======== ======== ========
(A) Income taxes includes the tax effect of adjusting for the
reconciling items and the utilization of deferred tax assets that
have full valuation allowances.
EXHIBIT #6
HARVARD BIOSCIENCE, INC.
Reconciliation of Changes In Total Revenue Compared to the Same
Period of the Prior Year (Continuing Operations)
(unaudited)
For the
Year
Three Months Ended Ended
--------------------------------------------------
March 31, June 30, Sept. 30, Dec. 31, Dec. 31,
2007 2007 2007 2007 2007
--------- --------- --------- --------- ---------
Organic growth -2.7% 4.4% -1.9% -3.5% -1.0%
Acquisitions 7.7% 4.2% 0.0% 13.5% 6.6%
Foreign exchange
effect 5.0% 3.6% 4.1% 3.1% 3.9%
--------- --------- --------- --------- ---------
Total revenue
growth 10.0% 12.2% 2.2% 13.1% 9.5%
========= ========= ========= ========= =========
For the
Year
Three Months Ended Ended
--------------------------------------------------
March 31, June 30, Sept. 30, Dec. 31, Dec. 31,
2008 2008 2008 2008 2008
--------- --------- --------- --------- ---------
Organic growth 0.1% -2.5% -1.2% 6.4% 1.0%
Acquisitions 12.6% 13.8% 8.2% 0.0% 8.2%
Foreign exchange
effect 2.2% 1.6% -3.7% -12.4% -3.6%
Total revenue --------- --------- --------- --------- ---------
growth 14.9% 12.9% 3.3% -6.0% 5.6%
========= ========= ========= ========= =========
Six
Months
Three Months Ended Ended
-----------------------------
March 31, June 30, June 30,
2009 2009 2009
--------- --------- ---------
Organic growth 0.0% -14.8% -7.6%
Acquisitions 0.0% 0.0% 0.0%
Foreign exchange
effect -13.2% -6.9% -9.9%
--------- --------- ---------
Total revenue growth -13.2% -21.7% -17.5%
========= ========= =========
EXHIBIT 7
Overview of Cash Flows
(Cash flow information includes cash flows for both
continuing and discontinued operations)
(in thousands, unaudited)
Six Months Ended
June 30,
------------------
2009 2008
------- -------
Cash flows from operations:
Net income $ 2,120 $(1,519)
Changes in assets and liabilities 1,750 (3,209)
Other adjustments to operating cash flows 2,851 6,905
------- -------
Net cash provided by operating activities 6,721 2,177
Investing activities:
Net cash used in investing activities (683) (1,348)
Financing activities:
Repayments of debt, net (850) (5,812)
Other financing activities (2,293) 727
------- -------
Net cash used in financing activities (3,143) (5,085)
Effect of exchange rate changes on cash 208 257
------- -------
Increase (decrease) in cash and cash equivalents $ 3,103 $(3,999)
======= =======
CONTACT:
508 893 8999
Fax: 508 429 8478
dgreen@harvardbioscience.com
Chane Graziano, CEO
cgraziano@harvardbioscience.com
tmcnaughton@harvardbioscience.com