SYS-CON MEDIA Authors: Carmen Gonzalez, Liz McMillan, Elizabeth White, Pat Romanski, Kevin Jackson

News Feed Item

Bio-Techne Releases Fourth Quarter And Full Year 2014 Results

MINNEAPOLIS, Aug. 11, 2014 /PRNewswire/ -- Techne Corporation (NASDAQ:TECH), (d/b/a Bio-Techne) today reported its financial results for the fourth quarter and full year ended June 30, 2014.

Fourth Quarter and Full Year 2014 Highlights

  • Increased fourth quarter revenue by 16% to $92.5 million, and full year revenue by 15% to a record $357.8 million.
  • Grew fourth quarter adjusted earnings per share (EPS) by 7% to $0.88, and full year adjusted EPS by 6% to a record $3.39.
  • Generated free cash flow of $123.0 million for the full year.
  • Achieved 25% revenue growth in the China region for the year by leveraging investments to expand commercial capabilities.  For the fourth quarter, China achieved 37% revenue growth year-over-year.
  • Broadened our product portfolio through a number of acquisitions  including:
    • Bionostics – expands our Clinical Controls Segment to include control solutions that verify the proper operation of in vitro diagnostic (IVD) devices primarily utilized in point of care blood glucose and blood gas testing.
    • Cyvek  – an initial investment, made with a commitment to fully acquire if certain future milestones are met, expected to complement Bio-Techne's existing antibodies and reagents by providing access to a transformative immunoassay platform, CyPlex™, which will integrate an innovatively designed microfluidic cartridge with a state-of-the-art analyzer to deliver the most advanced and efficient bench top immunoassay system.
    • PrimeGene – provides manufacturing capabilities in China of recombinant proteins for research and diagnostic applications for the China and global market.
    • Novus – closed July 2, 2014, complements our expanding portfolio of products and overall goal of providing customers the most comprehensive product line for their research needs, by providing more than 250,000 high-quality antibodies and other reagents delivered through an innovative digital commerce platform that creates a unique, one-stop shopping experience for customers.
    • ProteinSimple – closed July 31, 2014, serves many of the same customers as Bio-Techne, by providing them with tools that have revolutionized the analysis of proteins and provide a level of reliability, ease of use and performance that improves overall productivity and consistency in lab results.
  • Began operating under the new trade name, Bio-Techne, which brings the company's R&D Systems, BiosPacific, Tocris, Bionostics, PrimeGene, Novus, and ProteinSimple products under one common brand name.  The name solidifies the new strategic direction for the company along with unifying and positioning all of our brands under one complete portfolio.
  • Strengthened our commercial reach in North America by executing a distribution agreement with Fisher Scientific, who has a leading customer channel position in the life sciences market and represents broad customer reach and a proven record of customer service and support.
  • Added experienced, industry professionals to Bio-Techne's leadership team including a new CTO, CFO, and VP of Sales & Marketing.

"I am very pleased with the results for Q4 and even more pleased with the results for the full year," said Chuck Kummeth, President and Chief Executive Officer of Bio-Techne.  "The results demonstrate tremendous progress with our plan to expand in our core, regionally and with new platforms.  The acquisitions and investments into our channels will lay a foundation for improvements in sustainable long term organic growth.  I am very proud of the team and their achievements. "

Financial Results

Net sales as reported for the fourth quarter increased 16% to $92.5 million. Organic growth was 2% in the quarter.  Net sales as reported for the full year 2014 increased 15% to $357.8 million, with organic growth at 3%.  Organic sales exclude the impact of acquisitions completed in fiscal 2014 (Bionostics, PrimeGene) and the impact of foreign currency exchange rate fluctuations. 

Adjusted earnings for the fourth quarter were $32.5 million (an increase of 7% from the prior fiscal year period) or $0.88 per diluted share.  Adjusted earnings for the full year 2014 were $125.3 million (an increase of 6% from the prior fiscal year period) or $3.39 per diluted share.  Adjusted earnings and adjusted earnings per share exclude intangible asset amortization, costs recognized upon the sale of inventory that was written-up to fair value as part of acquisitions and professional fees related to acquisition activity in fiscal 2014 and the impact of certain tax events.  GAAP earnings were $26.8 million or $0.72 per diluted share for the fourth quarter and were $110.9 million or $3.00 per diluted share for the full year 2014.

Adjusted gross margins were 73.4% and 76.6% for the fourth quarter ended June 30, 2014 and 2013, and 73.5% and 76.8% for the full year ended June 30, 2014 and 2013, respectively.  The decrease in adjusted gross margins for the quarter and full year was primarily caused by a change in product mix from higher margin Biotechnology segment sales to Clinical Controls segment sales as a result of the Bionostics acquisition.  Adjusted gross margins exclude the costs recognized upon sale of acquired inventory and amortization of intangible assets. GAAP gross margin was 68.7% and 74.4% for the quarters ended June 30, 2014 and 2013, and 70.3% and 74.4% for the full year ended June 30, 2014 and 2013, respectively. 

Selling, general and administrative expenses for the fourth quarter and full year ended June 30, 2014 increased $5.0 million and $17.3 million, respectively, from the previous year. This increase in expenses for both the fourth quarter and full year ended June 30, 2014 included the acquired run-rate expenses from recent acquisitions, intangible asset amortization from recent acquisitions, and professional fees associated with on-going acquisitions as illustrated in the accompanying table.  The remaining increase includes investments made in commercial resources and administrative infrastructure.

The effective tax rates for the fourth quarter and full year ended June 30, 2014, were 32.0% and 31.3% compared to 30.3% and 29.9% for the same prior-year periods.  Included in the effective tax rate for the full year ended June 30, 2013 was a credit for research and development expenditures for the period of January 2012 to June 2013. The U.S. federal credit for research and development expenditures expired on December 31, 2011, was reinstated in the third quarter of fiscal 2013 and expired again on December 31, 2013.  Also included in the fourth quarter and full year 2013 income taxes was a reduction in U.S. tax expense due to changes in estimates related to foreign source income.      

Cash generated from operations for the fourth quarter and full year ended June 30, 2014 was $37.9 million and $136.8 million, respectively.  Capital expenditures for the fourth quarter and full year ended June 30, 2014 were $2.1 million and $13.8 million, respectively.

Segment Results

Biotechnology Segment

The Company's Biotechnology segment provides proteins, antibodies, immunoassays, flow cytometry products, intracellular cell signaling products, and chemical compounds used in biological research.  Biotechnology Segment's fourth quarter 2014 net sales were $76.7 million, an increase of 4% from $73.7 million for the fourth quarter ended June 30, 2013. For the 2014 full year, Biotechnology sales were $300.6 million, also an increase of 4% from $288.2 million for the 2013 full year.  Organic growth for the Biotechnology Segment was 1% and 3% for the fourth quarter and full year ended June 30, 2014, respectively.

The table below shows changes to the components of organic sales for the Biotechnology segment, from the same prior-year period.


Quarter Ended

Full Year Ended


6/30/14

6/30/14




U.S. industrial, pharmaceutical and biotechnology

4%

4%

U.S. academic

(8%)

(9%)

Europe

(3%)

1%

China Region

37%

25%

Pacific Rim

5%

10%

Clinical Controls Segment

The Company's Clinical Controls Segment provides a range of hematology controls, calibrators, and products used as proficiency testing tools by laboratory certifying authorities.  Clinical Controls Segment's fourth quarter 2014 net sales were $15.8 million, an increase of 176% from $5.7 million for the fourth quarter ended June 30, 2013. For the 2014 full year, Clinical Controls Segment sales were $57.2 million, an increase of 155% from $22.4 million for the full year 2013. Both fourth quarter and full year 2014 increases include the acquisition of Bionostics in the current year.  Organic growth for the Clinical Controls Segment was 8% and 7% for the fourth quarter and full year ended June 30, 2014, respectively.

Forward Looking Statements:

Our press releases may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Such statements 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 effect of new branding and marketing initiatives, the integration of new leadership, delays or obstacles in integrating acquired companies, the introduction and acceptance of new biotechnology and clinical control 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 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 events had on reported net sales, gross margin percentages, selling, general and administrative expenses, net earnings and earnings per share and the effective tax rate for the quarter and full year ended June 30, 2014 as compared to the reported amounts for the same prior-year periods:

  • fluctuations in exchange rates used to convert transactions in foreign currencies (primarily the Euro, British pound sterling and Chinese yuan) to U.S. dollars;
  • the acquisitions of Bionostics on July 22, 2013, PrimeGene on April 30, 2014 and Tocris Holdings Ltd. in fiscal 2011, including the impact of amortizing intangible assets and the recognition of costs upon the sale of inventory written-up to fair value;
  • professional fees related to the acquisitions of Bionostics and PrimeGene, which closed in fiscal 2014, the acquisitions of Novus and ProteinSimple, which closed in July 2014, and on-going acquisition activity.
  • income tax adjustments related to the reinstatement of the U.S. credit for research and development expenditures in fiscal 2013 and the expiration of the credit on December 31, 2013 and the effect of changes in estimates related to foreign source income in fiscal 2013.

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, (d/b/a Bio-Techne), NASDAQ: TECH, is a global life sciences company providing innovative bioactive tools and resources for the research and clinical diagnostic communities. Bio-Techne products assist scientific investigations into biological processes and the nature and progress of specific diseases. They aid in drug discovery efforts and provide the means for accurate clinical tests and diagnoses. With over 24,000 products in its portfolio, Bio-Techne generated approximately $358 million in net sales in FY 2014 and has over 1,000 employees worldwide. For more information on Bio-Techne and its brands, please visit www.bio-techne.com.

 

TECHNE CORPORATION

CONSOLIDATED STATEMENTS OF EARNINGS

(In thousands, except per share data)

(Unaudited)



QUARTER ENDED

FISCAL YEAR ENDED


6/30/14

6/30/13

6/30/14

6/30/13

Net sales

$ 92,523

$ 79,475

$357,763

$310,575

Cost of sales

28,930

20,358

106,352

79,465

Gross margin

63,593

59,117

251,411

231,110

Operating expenses:





   Selling, general and administrative

17,103

12,118

60,716

43,384

   Research and development

7,644

7,183

30,945

29,257

      Total operating expenses

24,747

19,301

91,661

72,641

Operating income

38,846

39,816

159,750

158,469

Other income (expense):





   Interest income

1,043

670

2,684

2,646

   Other non-operating expense, net

(438)

278

(1,042)

(453)

       Total other income (expense)

605

948

1,642

2,193

Earnings before income taxes

39,451

40,764

161,392

160,662

Income taxes

12,627

12,353

50,444

48,101

Net earnings

$26,824

$28,411

$110,948

$112,561

Earnings per share:





 Basic

$   0.73

$    0.77

$3.01

$3.06

 Diluted

$   0.72

$    0.77

$3.00

$3.05

Weighted average common shares outstanding:





  Basic

36,988

36,841

36,890

36,836

  Diluted

37,109

36,897

37,005

36,900

 

 


TECHNE CORPORATION

CONSOLIDATED CONDENSED BALANCE SHEETS

(In thousands)

(Unaudited)


ASSETS

6/31/14

6/30/13

Cash and equivalents

$318,568

$163,786

Short-term available-for-sale investments

44,786

169,151

Trade accounts receivable

47,874

38,183

Inventory

38,847

34,877

Deferred income taxes

9,623

0

Other current assets

9,715

3,519

  Current assets

469,413

409,516

Available-for-sale investments

3,575

132,376

Property and equipment, net

117,120

108,756

Goodwill and intangible assets, net

260,249

124,888

Other non-current assets

12,134

2,562

  Total assets

$862,491

$778,098

LIABILITIES AND STOCKHOLDERS' EQUITY



Accounts payable and accrued expenses

$19,946

$  13,385

Payable for pending available-for-sale investment purchases

0

6,479

Income taxes payable

496

2,276

Note payable - current

5,949

0

Deferred income taxes

0

9,944

  Current liabilities

26,391

32,084

Note payable

6,997

0

Deferred taxes

33,838

8,473

Stockholders' equity

795,265

737,541

  Total liabilities and stockholders' equity

$862,491

$778,098

 

 

TECHNE CORPORATION

RECONCILIATION of GROSS MARGIN PERCENTAGES

(Unaudited)



QUARTER ENDED

FISCAL YEAR ENDED


6/30/14

6/30/13

6/30/14

6/30/13

Gross margin percentage

68.7%

74.4%

70.3%

74.4%

Identified adjustments:





     Costs recognized upon sale of acquired inventory

3.4%

1.3%

2.1%

1.4%

     Amortization of intangibles

1.3%

0.9%

1.1%

1.0%

Gross margin percentage - adjusted

73.4%

76.6%

73.5%

76.8%

 

 

TECHNE CORPORATION

RECONCILIATION of SELLING, GENERAL and ADMINISTRATIVE EXPENSES

(In thousands)

(Unaudited)



QUARTER ENDED

 FISCAL YEAR ENDED


6/30/14

6/30/13

6/30/14

6/30/13

Selling, general and administrative expenses

$17,103

$12,118

$60,716

$43,384

Identified adjustments:





     Acquired company expense, excluding intangible amortization

(1,018)

0

(4,158)

0

     Acquisition related professional fees

(1,320)

(607)

(2,247)

(607)

     Amortization of intangibles

(1,761)

(513)

(6,077)

(2,069)

Selling, general and administrative expenses - adjusted 

$13,004

$10,998

$48,234

$40,708

 

 


TECHNE CORPORATION

RECONCILIATION of NET EARNINGS and EARNINGS per SHARE

(In thousands, except per share data)

(Unaudited)



QUARTER ENDED

FISCAL YEAR  ENDED


6/30/14

6/30/13

6/30/14

6/30/13

Net earnings

$26,824

$28,411

$110,948

$112,561

Identified adjustments:





     Costs recognized upon sale of acquired inventory

3,167

1,005

7,479

4,501

     Amortization of intangibles

2,887

1,249

10,267

5,061

     Acquisition related professional fees

1,320

607

2,247

607

     Tax impact of above adjustments

(1,752)

(630)

(5,305)

(2,596)

     Tax impact of research and development credit

0

(206)

(476)

(1,392)

     Tax impact of foreign source income

29

(210)

165

(710)

Net earnings - adjusted 

$32,475

$30,226

$125,325

$118,032






Earnings per share - diluted – adjusted

$   0.88

$    0.82

$      3.39

$     3.20

 

 

TECHNE CORPORATION

RECONCILIATION of EFFECTIVE TAX RATE

(Unaudited)



QUARTER ENDED

FISCAL YEAR ENDED


6/30/14

6/30/13

6/30/14

6/30/13

Effective tax rate

32.0%

30.3%

31.3%

29.9%

Identified adjustments:





     Research and development credit

0.0%

0.5%

0.3%

0.9%

     Foreign source income

(0.1%)

0.5%

(0.1%)

0.4%

      Non-deductible acquisition related professional fees

(0.5%)

(0.5%)

(0.4%)

(0.1%)

Effective tax rate - adjusted

31.4%

30.8%

31.1%

31.1%

 

 

TECHNE CORPORATION

RECONCILIATION of INTANGIBLE AMORTIZATION

(In thousands)

(Unaudited)



QUARTER ENDED

FISCAL YEAR ENDED


6/30/14

6/30/13

6/30/14

6/30/13

Amortization of intangible assets included in:





     Cost of goods sold

$1,126

$736

$4,190

$2,992

     Selling, general and administrative expenses

1,761

513

6,077

2,069

Total amortization of intangible assets

$2,887

$1,249

$10,267

$5,601

 

SOURCE Techne Corporation

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
SYS-CON Events announced today that ActiveState, the leading independent Cloud Foundry and Docker-based PaaS provider, has been named “Silver Sponsor” of SYS-CON's DevOps Summit New York, which will take place June 9-11, 2015, at the Javits Center in New York City, NY. ActiveState believes that enterprises gain a competitive advantage when they are able to quickly create, deploy and efficiently manage software solutions that immediately create business value, but they face many challenges that ...
Companies today struggle to manage the types and volume of data their customers and employees generate and use every day. With billions of requests daily, operational consistency can be elusive. In his session at Big Data Expo, Dave McCrory, CTO at Basho Technologies, will explore how a distributed systems solution, such as NoSQL, can give organizations the consistency and availability necessary to succeed with on-demand data, offering high availability at massive scale.
Today’s enterprise is being driven by disruptive competitive and human capital requirements to provide enterprise application access through not only desktops, but also mobile devices. To retrofit existing programs across all these devices using traditional programming methods is very costly and time consuming – often prohibitively so. In his session at @ThingsExpo, Jesse Shiah, CEO, President, and Co-Founder of AgilePoint Inc., discussed how you can create applications that run on all mobile ...
IoT is still a vague buzzword for many people. In his session at @ThingsExpo, Mike Kavis, Vice President & Principal Cloud Architect at Cloud Technology Partners, discussed the business value of IoT that goes far beyond the general public's perception that IoT is all about wearables and home consumer services. He also discussed how IoT is perceived by investors and how venture capitalist access this space. Other topics discussed were barriers to success, what is new, what is old, and what th...
Security can create serious friction for DevOps processes. We've come up with an approach to alleviate the friction and provide security value to DevOps teams. In her session at DevOps Summit, Shannon Lietz, Senior Manager of DevSecOps at Intuit, will discuss how DevSecOps got started and how it has evolved. Shannon Lietz has over two decades of experience pursuing next generation security solutions. She is currently the DevSecOps Leader for Intuit where she is responsible for setting and driv...
Dale Kim is the Director of Industry Solutions at MapR. His background includes a variety of technical and management roles at information technology companies. While his experience includes work with relational databases, much of his career pertains to non-relational data in the areas of search, content management, and NoSQL, and includes senior roles in technical marketing, sales engineering, and support engineering. Dale holds an MBA from Santa Clara University, and a BA in Computer Science f...
SYS-CON Media announced that Cisco, a worldwide leader in IT that helps companies seize the opportunities of tomorrow, has launched a new ad campaign in Cloud Computing Journal. The ad campaign, a webcast titled 'Is Your Data Center Ready for the Application Economy?', focuses on the latest data center networking technologies, including SDN or ACI, and how customers are using SDN and ACI in their organizations to achieve business agility. The Cisco webcast is available on-demand.
Thanks to Docker, it becomes very easy to leverage containers to build, ship, and run any Linux application on any kind of infrastructure. Docker is particularly helpful for microservice architectures because their successful implementation relies on a fast, efficient deployment mechanism – which is precisely one of the features of Docker. Microservice architectures are therefore becoming more popular, and are increasingly seen as an interesting option even for smaller projects, instead of bein...
The Internet of Things (IoT) promises to evolve the way the world does business; however, understanding how to apply it to your company can be a mystery. Most people struggle with understanding the potential business uses or tend to get caught up in the technology, resulting in solutions that fail to meet even minimum business goals. In his session at @ThingsExpo, Jesse Shiah, CEO / President / Co-Founder of AgilePoint Inc., showed what is needed to leverage the IoT to transform your business. ...
Datapipe has acquired GoGrid, a provider of multi-cloud solutions for Big Data deployments. GoGrid’s proprietary orchestration and automation technologies provide 1-Button deployment for Big Data solutions that speed creation and results of new cloud projects. “GoGrid has made it easy for companies to stand up Big Data solutions quickly,” said Robb Allen, CEO, Datapipe. “Datapipe customers will achieve significant value from the speed at which we can now create new Big Data projects in the clou...
Cloud Technology Partners on Wednesday announced it has been recognized by the Modern Infrastructure Impact Awards as one of the Best Amazon Web Services (AWS) Consulting Partners. Selected by the editors of TechTarget's SearchDataCenter.com, and by votes from customers and strategic channel partners, the companies acknowledged by the Modern Infrastructure Impact Awards represent the top providers of cloud consulting services for AWS including application migration, application development, inf...
“We help people build clusters, in the classical sense of the cluster. We help people put a full stack on top of every single one of those machines. We do the full bare metal install," explained Greg Bruno, Vice President of Engineering and co-founder of StackIQ, in this SYS-CON.tv interview at 15th Cloud Expo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
SYS-CON Media announced that Splunk, a provider of the leading software platform for real-time Operational Intelligence, has launched an ad campaign on Big Data Journal. Splunk software and cloud services enable organizations to search, monitor, analyze and visualize machine-generated big data coming from websites, applications, servers, networks, sensors and mobile devices. The ads focus on delivering ROI - how improved uptime delivered $6M in annual ROI, improving customer operations by minin...
"Blue Box has been around for 10-11 years, and last year we launched Blue Box Cloud. We like the term 'Private Cloud as a Service' because we think that embodies what we are launching as a product - it's a managed hosted private cloud," explained Giles Frith, Vice President of Customer Operations at Blue Box, in this SYS-CON.tv interview at DevOps Summit, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
"People are a lot more knowledgeable about APIs now. There are two types of people who work with APIs - IT people who want to use APIs for something internal and the product managers who want to do something outside APIs for people to connect to them," explained Roberto Medrano, Executive Vice President at SOA Software, in this SYS-CON.tv interview at Cloud Expo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.