BioSource International, Inc. Announces 11% Increase in Sales and $103,000 in Net Income for the First Quarter 2003.Business Editors CAMARILLO Camarillo (kă'mərē`yō), city (1990 pop. 52,303), Ventura co., S Calif.; inc. 1964. It is the center of a fertile farm area where citrus fruits and flowers are grown. , Calif.--(BUSINESS WIRE)--April 29, 2003 BioSource International, Inc. (Nasdaq:BIOI), announced today its operating results for the first quarter ended March 31, 2003. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the three months ended March 31, 2003, were a record $10.9 million, an increase of $1.1 million, or 11%, compared to net sales for the three months ended March 31, 2002; and net income available to common shareholders for the quarter ended March 31, 2003, was $103,000, compared to a net loss available to common shareholders of $2,499,000 for the comparable period in 2002. Len Hendrickson Hendrickson Int'l Corp. is a privately-held company with revenues in excess of $1 billion that designs and manufactures commercial full size truck suspensions. The company works with single, tandem, and tridem drive axles as well as front and trailer suspensions. , President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of BioSource, commented: "We returned to a double-digit dou·ble-dig·it adj. Being between 10 and 99 percent: double-digit inflation. growth rate in the first quarter of 2003 and became profitable. Our investment in research and development last year, which resulted in the introduction of 54 phospho-specific antibodies and 18 phosphoELISA(TM)s, has paid off with a revenue growth rate of over 60% for our Signal Transduction Signal transduction The transmission of molecular signals from a cell's exterior to its interior. Molecular signals are transmitted between cells by the secretion of hormones and other chemical factors, which are then picked up by different cells. Products. We have a number of significant products being launched this quarter, notably more phosphoELISA(TM)s and our first phosphoLuminex assays, which will continue to drive our strong growth in this key area for the company." Net income available to common shareholders for the three months ended March 31, 2003, was $103,000, or $.01 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared to a net loss available to common shareholders of $2,499,000, or $.23 per diluted share, for the three months ended March 31, 2002. In the first quarter of 2002, the Company recognized a non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. , net of applicable income taxes, of $2,870,000, representing the cumulative effect of a change in accounting principle resulting from the implementation of Financial Accounting Standards ("FAS") 142, Accounting for Goodwill and Other Intangible Assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. . Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for the three months ended March 31, 2003, was $121,000, compared to an operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of $374,000 for the three months ended December 31, 2002. The company's revenues benefited by a $551,000 positive impact of foreign exchange. To better drive growth and focus on key market opportunities the Company has divided its business into three core areas: The Strategic Business Units ("SBUs") of Signal Transduction Products, Cytokine Cytokine Any of a group of soluble proteins that are released by a cell to send messages which are delivered to the same cell (autocrine), an adjacent cell (paracrine), or a distant cell (endocrine). Products, and Custom Products. Signal Transduction Products consists of the proteins, antibodies, assays and other reagents used to study internal cellular processes. Our phospho-specific antibodies and phosphoELISA(TM)s are included in this SBU SBU St. Bonaventure University (St. Bonaventure, New York) SBU Stony Brook University (State University of New York) SBU Southwest Baptist University (Bolivar, MO) . Cytokine Products includes the proteins, antibodies, assays and other reagents that are used to study the processes by which cells communicate. Interleukin interleukin Any of a class of naturally occurring proteins important in regulation of lymphocyte function. Several known types are recognized as crucial constituents of the body's immune system (see immunity). , growth factor and other biological response modifier biological response modifier n. A substance, such as interferon, that is produced naturally or manufactured as a drug designed to strengthen, direct, or restore the body's immune response against infection or cancer. products are included in this group. Custom Products includes oligonucleotides, custom peptides and antibodies, cell culture and diagnostics (1) Software routines that test hardware components (memory, keyboard, disks, etc.). Diagnostics are often stored in ROM chips and activated on startup. (2) Error messages in a programmer's source code that refer to statements or syntax that the compiler or assembler and other reagents not specifically categorized cat·e·go·rize tr.v. cat·e·go·rized, cat·e·go·riz·ing, cat·e·go·riz·es To put into a category or categories; classify. cat . For the three months ended March 31, 2003, the company's signaling product lines, grew 62% compared to the comparable prior-year quarter, from $1,495,000 to $2,430,000. The Company's sales growth in its cytokine product lines for the quarter ended March 31, 2003, was 7%, growing from $4,566,000 to $4,877,000, compared to the three months ended March 31, 2002. The Company custom product lines decreased 3% compared to the comparable prior-year quarter, from $3,720,000 to $3,592,000. Len Hendrickson noted: "This new structure will enable us to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the significant opportunities in our core signaling and cytokine markets, while better managing our custom products business. Signal Transduction and Cytokine Products were a major focus of our research and development efforts in 2002 and we believe the growth rate of 20% in our combined Signal Transduction and Cytokine Product lines this quarter demonstrates the importance of these areas to BioSource." Gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. was 57% for both the three months ended March 31, 2003 and 2002. The Company margins remained constant in part due to the continued investment in production- and planning-related areas within the Company. The Company's margins in its cytokine and signaling core product lines continue to be strong. The margins in our custom product lines have limited our overall gross margin improvement. Research and development expenses for the three months ended March 31, 2003 and 2002, were $1,979,000 and $1,293,000 and represented 18% and 13% of sales, respectively. The increase in research and development expenses for the three months ended March 31, 2003, when compared to the comparable prior-year period, reflects the Company's incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. investment in additional personnel and materials in the cytokine and signal transduction research areas. The company has made a significant investment in its R&D capabilities over the past 15 months. The result of this investment has been the release of significantly more and higher quality and novel products, and resulted in increased sales in both the cytokine and signaling product lines. Quarterly expenditures in R&D for the remainder of 2003 are expected to be slightly less than those in the first quarter of 2003. Selling, marketing and administrative expenses were $4.0 million for the three months ended March 31, 2003, and $3.7 million for the three months ended March 31, 2002, representing 36% and 38% of sales, respectively. The Company continues to manage its SG&A expenses downward as a percentage of sales. In the three months ended March 31, 2003, our sales and marketing expenses in personnel and marketing programs increased $100,000 from the comparable prior-year period. In 2003, the company changed its method in accounting for its annual catalog catalog, descriptive list, on cards or in a book, of the contents of a library. Assurbanipal's library at Nineveh was cataloged on shelves of slate. The first known subject catalog was compiled by Callimachus at the Alexandrian Library in the 3d cent. B.C. advertising costs. In the past, the Company has expensed catalog advertising costs as incurred, which was primarily in the first quarter of its fiscal year. During 2002, the Company put a substantial effort into increasing the number of customers in its customer database and in conjunction with that, its dependence on its catalog to attract more customers. Accordingly, beginning in 2003, the Company is capitalizing its catalog costs and expensing them evenly throughout the fiscal year in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the AICPA's Statement of Position 93-7. In the first quarter of 2002, the Company expensed approximately $359,000 of catalog costs compared to $113,000 for the first quarter of 2003. The Company does not anticipate its annual catalog costs to be materially different from 2002 to 2003. The effective tax rate for the three months ended March 31, 2003, was 10%. The Company is benefiting from R&D and other tax credits which, when applied to income levels for the periods presented, is resulting in effective tax rates lower than the current applicable federal and state statutory rates. The Company has elected to utilize the Extraterritorial ex·tra·ter·ri·to·ri·al adj. 1. Located outside territorial boundaries: fishing in extraterritorial waters. 2. Income Exclusion ("EIE EIE Eniseysk (Russia) EIE Erie Insurance Exchange EIE Eisendrath International Exchange (high school exchange program in Israel) EIE Enterprise Information Environment EIE Enterprise Integration Engine ") federal tax credit, which, along with other tax credits, has reduced its effective tax rate for 2003 to 10%. Additionally, the Board of Directors of BioSource International, Inc., on April 22, 2003, approved extending the expiration date Expiration Date The day on which an options or futures contract is no longer valid and, therefore, ceases to exist. Notes: The expiration date for all listed stock options in the U.S. of the Company's current stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program from June 2003 until June 2004. In addition, the Board approved adding $5 million to its current $10 million allowable repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. commitment, bringing the total limit to $15 million. In the first quarter of 2003, the Company spent $662,000 repurchasing 110,000 shares of its common stock under its stock repurchase program, bringing the total number of shares repurchased since October 2001 to 989,000 and total cash outlays Outlays Payments on obligations in the form of cash, checks, the issuance of bonds or notes, or the maturing of interest coupons. to $5.9 million. This has contributed to the reduction in weighted average diluted shares outstanding for the three months ended March 31, 2003, to 10,026,000 compared to the 10,757,000 diluted shares for the three months ended March 31, 2002. Since inception, the company has repurchased 9% of its outstanding common stock. The Company will conduct a conference call today at 10:00 A.M. Pacific Time. All interested parties may call (800) 237-9752, reservation number 7881688, to participate in the call. In addition, the Company will be web casting the conference call. You can participate by going to our website at www.biosource.com and entering the investor relations' portion of the website. BioSource International, Inc. is a broad-based broad-based Of or relating to an index or average that provides a good representation of the overall market. The S&P 500 and NYSE Composite are generally regarded as broad-based stock indexes, while the popular Dow Jones Industrial Average is biased life sciences company focused on providing integrated solutions in the areas of functional genomics Noun 1. functional genomics - the branch of genomics that determines the biological function of the genes and their products genomics - the branch of genetics that studies organisms in terms of their genomes (their full DNA sequences) , proteomics pro·te·o·mics n. The analysis of the expression, localization, functions, and interactions of the proteins produced by the genes of an organism. , and drug discovery through the development, manufacturing, marketing and distribution of unique biologically active reagent reagent /re·a·gent/ (re-a´jent) a substance used to produce a chemical reaction so as to detect, measure, produce, etc., other substances. re·a·gent n. systems which facilitate, enable and accelerate pharmaceutical development and biomedical research Biomedical research (or experimental medicine), in general simply known as medical research, is the basic research or applied research conducted to aid the body of knowledge in the field of medicine. . This press release contains statements about expected future events that are forward-looking and subject to risks and uncertainties. For these statements, we claim the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. for "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Factors that could cause actual results to differ and vary materially from expectations include, but are not limited to, our ability to expand our product offerings and any transition to new products, product quality and availability, any change in business conditions, changes in our sales strategy and product development plans, competitive pricing pressures, continued market acceptance of our products, name recognition of our products, delays in the development of new technology, intellectual property and proprietary rights may not be valid or infringe in·fringe v. in·fringed, in·fring·ing, in·fring·es v.tr. 1. To transgress or exceed the limits of; violate: infringe a contract; infringe a patent. 2. the rights of others, changes in customer buying pattern issues, one-time events, and other important factors disclosed previously and from time to time in our filings with the Securities and Exchange Commission. These cautionary statements by us should not be construed as exhaustive or as any admission regarding the adequacy of disclosures made by us. We cannot always predict or determine after the fact what factors would cause actual results to differ materially from those indicated by the forward-looking statements or other statements. In addition, readers are urged to consider statements that include the terms "believes," "belief," "expects," "plans," "objectives," "anticipates," "intends," "targets," "projections," or the like to be uncertain and forward-looking. All cautionary statements should be read as being applicable to all forward-looking statements wherever they appear. We do not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
BIOSOURCE INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended March 31, 2003 and 2002
(Amounts in thousands, except per share data)
(Unaudited)
Three Months
Ended
March 31,
---------------
2003 2002
------- -------
Net sales $10,899 9,781
Cost of sales 4,690 4,196
------- -------
Gross profit 6,209 5,585
Operating expenses:
Research and development 1,979 1,293
Sales and marketing 2,388 2,266
General and administrative 1,576 1,460
Amortization of intangibles 145 160
------- -------
Total operating expenses 6,088 5,179
------- -------
Operating income 121 406
Interest income, net 11 40
Other income (expense), net (18) 30
------- -------
Income before income taxes 114 476
Income tax expense 11 105
------- -------
Net income before cumulative effect of
accounting change 103 371
Cumulative effect of accounting change (net of
applicable income taxes of $1,759) - (2,870)
------- -------
Net income (loss) available to common shareholders $ 103 (2,499)
======= =======
Net income per share before accounting change:
Basic $ 0.01 0.04
======= =======
Diluted $ 0.01 0.03
======= =======
Net income (loss) per share after accounting change:
Basic $ 0.01 (0.25)
======= =======
Diluted $ 0.01 (0.23)
======= =======
Shares used to compute net income (loss):
Basic 9,635 10,190
======= =======
Diluted 10,026 10,757
======= =======
BIOSOURCE INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
March December
31, 31,
2003 2002
------- --------
ASSETS
Current assets:
Cash and cash equivalents $ 3,840 5,941
Accounts receivable, less allowance for doubtful
accounts of $264 at March 31, 2003, and $261
at December 31, 2002 7,129 6,157
Inventories, net 9,483 8,880
Prepaid expenses and other current
assets 862 538
Deferred income taxes 1,873 1,873
------- --------
Total current assets 23,187 23,389
Property and equipment, net 7,186 7,398
Intangible assets net of accumulated amortization of
$2,800 at March 31, 2003, and $2,655 at December 31,
2002 5,931 6,076
Goodwill 307 307
Other assets 537 526
Deferred tax assets 8,810 8,810
------- --------
$45,958 46,506
======= ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 2,639 3,115
Accrued expenses 2,792 2,910
Deferred revenue 378 427
Income tax payable 664 341
------- --------
Total current liabilities 6,473 6,793
Commitments and contingencies
Stockholders' equity:
Common stock, $.001 par value. Authorized 20,000,000
shares: issued and outstanding 9,610,305
shares at March 31, 2003, and 9,676,931 at
December 31, 2001 10 10
Additional paid-in capital 43,929 44,500
Accumulated deficit (3,279) (3,382)
Accumulated other comprehensive loss (1,175) (1,415)
------- --------
Net stockholders' equity 39,485 39,713
------- --------
$45,958 46,506
======= ========
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