BioSource International, Inc. Announces Record Sales of $10.3M and Diluted EPS of $.04 in 2nd Quarter 2002.Business Editors BioSource International, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :BIOI), announced today its operating results for the second quarter ended June June: see month. 30, 2002. 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 quarter ended June 30, 2002, were a record $10.3 million, an increase of $1.5 million, or 17%, (16% after eliminating the $87,000 positive impact of foreign exchange) compared to net sales for the quarter ended June 30, 2001. For the three months ended June 30, 2002, the Company achieved net sales growth in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. of 12% as compared to the three months ended June 30, 2001. European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. sales for the three months ended June 30, 2002 increased 27% (24% in local currency), as compared to the comparable prior year period. Sales in Japan and the rest of the world increased 26%, for the three months ended June 30, 2002, as compared to the three months ended June 30, 2001. Net sales for the six months ended June 30, 2002, were also a record $20.1 million, an increase of $2.7 million, or 15%, (15% after eliminating the $49,000 negative impact of foreign exchange) compared to net sales for the six months ended June 30, 2001. For the six months ended June 30, 2002, the Company achieved net sales growth in North America of 17% as compared to the six months ended June 30, 2001. European sales for the six months ended June 30, 2002, increased 14% (15% in local currency), as compared to the comparable prior year period. Sales in Japan and the rest of the world increased 12%, for the six months ended June 30, 2002, as compared to the six months ended June 30, 2001. Net income per fully 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 for the three months ended June 30, 2002 was $449,000, or $.04, compared to $574,000, or $.05, for the three months ended June 30, 2001. Excluding amortization of intangibles, net income per fully diluted share was $609,000, or $.06 per share, for the three months ended June 30, 2002 compared to $849,000, or $.08 per share, for the three months ended June 30, 2001. Net income per fully diluted share excluding the effects of implementation of Financial Accounting Standards ("FAS") 142, for the six months ended June 30, 2002, was $821,000, or $.08, compared to $524,000, or $.05, for the six months ended June 30, 2001. Excluding amortization of intangibles, net income per fully diluted share was $1,142,000, or $.11 per share, for the six months ended June 30, 2002, compared to $1,073,000, or $.10 per share, for the six months ended June 30, 2001. 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. for the three months ended June 30, 2002, was 56%, compared to 58% for the three months ended June 30, 2001. The gross profit margin was lower for the quarter ended June 30, 2002, primarily due to excess capacity in our Camarillo, California Camarillo is a city in Ventura County, California, United States. The population was 57,077 at the 2000 census. A January 1, 2006 California Department of Finance estimate lists the population at 64,034. The Ventura Freeway (U.S. Route 101) is the city's primary thoroughfare. , oligo facility. Gross profit margin for the six months ended June 30, 2002, and 2001 remained constant at 56%. Increased oligo overhead costs overhead costs see fixed costs. were offset by increased margins in other product lines including serum and media and 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. Selling, marketing and administrative expenses were $3.5 million for the three months ended June 30, 2002, and $3.2 million for the three months ended June 30, 2001. Selling, marketing and administrative expenses represented 34% and 36% of sales for the three months ended June 30, 2002, and 2001, respectively. In the quarter ended June 30, 2002, our sales and marketing personnel expenses increased $200,000 from the comparable prior year period while our general and administrative expenses, excluding the charges described below, decreased by $200,000. Excluding a net expense reduction of $204,000 in the second quarter of 2001, primarily resulting from a $727,000 expense reduction due to a non-cash stock compensation adjustment offset by $426,000 of legal fees related to an employee termination, the Company reduced its SG&A expenses, as a percentage of sales, from 39% to 34%. Selling, marketing and administrative expenses were $7.2 million for the six months ended June 30, 2002, and $6.9 million for the six months ended June 30, 2001. Selling, marketing and administrative expenses represented 36% and 40% of sales for the six months ended June 30, 2002, and 2001, respectively. In the six months ended June 30, 2002, our sales and marketing expenses in personnel and marketing programs increased $300,000 from the comparable prior year period. Research and development expense for the three months ended June 30, 2002, and 2001 were $1,512,000 and $925,000, respectively. Research and development expenses were 15% and 11% of sales for the three months ended June 30, 2002, and 2001, respectively. Research and development expense for the six months ended June 30, 2002 and 2001 were $2,805,000 and $1,879,000, respectively. Research and development expenses were 14% and 11% of sales for the six months ended June 30, 2002, and 2001, respectively. The increase in expenses for the three and six months ended June 30, 2002, when compared to the comparable prior year period reflects the Company's previously announced strategy of increasing R & D spending with the goal of producing more new, novel and proprietary products. The effective tax rate for the six months ending June 30, 2002, and 2001, was 22% and 31%, respectively. The Company is benefiting from R & D and other tax credits which when applied to current income levels for the periods presented is resulting in effective tax rates lower than the current applicable federal and state statutory rates. In the second quarter of 2002, the Company repurchased 200,000 shares of its common stock under its stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program, bringing the total number of shares repurchased since October October: see month. 2001 to 826,000. This has contributed to the reduction in diluted shares outstanding for the three and six months ended June 30, 2001, of 10,964,000 and 11,176,000, respectively, and to 10,101,000 and 10,401,000, respectively, for the three and six months ended June 30, 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 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. . This charge is shown below net income as a cumulative effect of a change in accounting principle. With this non-cash charge, the Company has recorded a net loss available to common shareholders for the six months ended June 30, 2002, of ($2,049,000), or $(.20) per diluted share. The effect of the implementation of FAS 142 reduced amortization of intangibles on the condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. consolidated statement of operations See Income statement. from $549,000 for the six months ended June 30, 2001, to $321,000 for the six months ended June 30, 2002. "Sales for the second quarter were $10.3 million, an increase of 17% over the second quarter of 2001," said Mr. Len Mr. Len (Leonard "Lenny" Smythe) is a hip hop DJ from Brooklyn, New York. He was a member, with Bigg Jus and El-P, of the underground hip hop trio Company Flow, which disbanded in the late-1990s. 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 Chief Executive Officer of BioSource. "We are quite pleased with these results and are optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op about our earlier announced projections for operating performance over the next three years. We are currently on track to be at the upper end our 2002 projections of 11% to 13% sales growth, $3 to $3.5 million of earnings before interest, taxes, depreciation, and amortization Earnings before interest, taxes, depreciation, and amortization (EBITDA) A financial measure defined as revenues less cost of goods sold and selling, general, and administrative expenses. , or EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become , and $.14 to $.17 cash earnings per share," stated Mr. Hendrickson. "I want to reiterate re·it·er·ate tr.v. re·it·er·at·ed, re·it·er·at·ing, re·it·er·ates To say or do again or repeatedly. See Synonyms at repeat. re·it that our goal is to create a sustainable higher long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. growth rate and improved profitability for the Company so that shareholder value will increase. "As announced in early July July: see month. , we have settled our arbitration arbitration Process of resolving a dispute or a grievance outside a court system by presenting it for decision to an impartial third party. Both sides in the dispute usually must agree in advance to the choice of arbitrator and certify that they will abide by the claim and have received $800,000 as a result," said Mr. Hendrickson. "We are very pleased with this cash recovery and are happy that this issue, along with the settlement of a wrongful termination wrongful termination n. a right of an employee to sue his/her employer for damages (loss of wage and "fringe" benefits, and, if against "public policy," for punitive damages). suit this past February February: see month. , are behind us. These developments allow us to continue to place our focus and efforts on the operations of the business. "We are also very excited about the addition of Dr. John Zabriskie to our Board of Directors, which we announced today in a separate press release," stated Mr. Hendrickson. "His experience in the pharmaceutical industry and his personal strengths will be an asset to the Company. "The internal focus on our research and development program in the 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). and signal transduction markets continues," said Mr. Hendrickson. "Our internal milestones are being met and we are seeing a good response to our recent product introductions. I want to again thank all the BioSource employees worldwide for their efforts this year and we look forward to further progress at BioSource." The Company will conduct a conference call today at 10:00 a.m. pacific time. All interested parties may call (212) 346-7490, reservation number 20737163 to participate in the call. 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 for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. 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 and Six Months Ended June 30, 2002 and 2001
(Amounts in thousands, except per share data)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
---------------------------------------
2002 2001 2002 2001
--------- --------- --------- ---------
Net sales $ 10,292 8,760 20,073 17,417
Cost of sales 4,548 3,678 8,744 7,635
--------- --------- --------- ---------
Gross profit 5,744 5,082 11,329 9,782
Operating expenses:
Research and development 1,512 925 2,805 1,879
Sales and marketing 2,013 1,823 4,278 3,746
General and administrative 1,471 1,360 2,932 3,167
Amortization of intangibles 160 275 321 549
--------- --------- --------- ---------
Total operating expenses 5,156 4,383 10,336 9,341
--------- --------- --------- ---------
Operating income 588 699 993 441
Interest income (expense), net 20 107 61 243
Other income (expense), net (31) 26 (1) 75
--------- --------- --------- ---------
Income before income
taxes (benefit) 577 832 1,053 759
Income tax expense 128 258 232 235
--------- --------- --------- ---------
Net income before
cumulative effect of
accounting change 449 574 821 524
Cumulative effect of accounting
change (net of applicable
income taxes of $1,759) -- -- (2,870) --
--------- --------- --------- ---------
Net income (loss) available
to common shareholders $ 449 574 (2,049) 524
========= ========= ========= =========
Net income per share before
accounting change:
Basic $ 0.05 0.06 0.08 0.05
========= ========= ========= =========
Diluted $ 0.04 0.05 0.08 0.05
========= ========= ========= =========
Net income (loss) per share
after accounting change:
Basic $ 0.05 0.06 (0.21) 0.05
========= ========= ========= =========
Diluted $ 0.04 0.05 (0.20) 0.05
========= ========= ========= =========
Shares used to compute
net income (loss):
Basic 9,654 10,428 9,922 10,378
========= ========= ========= =========
Diluted 10,101 10,964 10,401 11,176
========= ========= ========= =========
BIOSOURCE INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
(Unaudited)
June 30, Dec. 31,
2002 2001
---------- ----------
ASSETS
Current assets:
Cash and cash equivalents $ 4,723 9,471
Accounts receivable, less allowance
for doubtful accounts of $219 at
June 30, 2002, and $261 at
December 31, 2001 7,146 6,184
Inventories, net 7,833 7,184
Prepaid expenses and other current assets 924 540
Deferred income taxes 1,584 1,584
---------- ----------
Total current assets 22,210 24,963
Property and equipment, net 6,698 5,408
Intangible assets net of accumulated
amortization of $2,334 at June 30, 2002,
and $3,377 at December 31, 2001 6,704 11,653
Other assets 519 491
Deferred tax assets 9,085 7,326
---------- ----------
$ 45,216 49,841
========== ==========
LIABILITIES AND STOCKHOLDERS EQUITY
Current liabilities:
Accounts payable $ 3,038 2,416
Accrued expenses 2,660 2,707
Deferred revenue 503 404
Income tax payable 648 436
---------- ----------
Total current liabilities 6,849 5,963
Commitments and contingencies
Stockholders' equity:
Common stock, $.001 par value. Authorized
20,000,000 shares: issued and outstanding
9,668,945 shares at June 30, 2002; issued
10,449,817 shares and outstanding
10,353,817 shares at December 31, 2001 10 10
Additional paid-in capital 44,599 48,761
Accumulated deficit (4,379) (2,330)
Accumulated other comprehensive loss (1,863) (2,563)
---------- ----------
Net stockholders' equity 38,367 43,878
---------- ----------
$ 45,216 49,841
========== ==========
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