Dade Behring Reports 5 Percent Revenue Growth in the Second Quarter, 2006; Earnings per share increases 139 percent.DEERFIELD Deerfield, towns, United States Deerfield. 1 Village (1990 pop. 17,327), Cook and Lake counties, NE Ill., a residential suburb of Chicago; inc. 1903. The huge Sara Lee Bakery is its major industry, and there is other light manufacturing. , Ill. -- Dade v. t. 1. To hold up by leading strings or by the hand, as a child while he toddles. Little children when they learn to go By painful mothers daded to and fro. - Drayton. v. i. 1. Behring Beh·ring , Emil Von 1854-1917. German physiologist. He won a 1901 Nobel Prize for work on serum immunization against diphtheria and tetanus. Holdings, 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 :DADE) today reported second quarter earnings per share of $0.43, an increase of $0.25 per share over the second quarter of 2005 and also reported revenue of $445 million, an increase of 5 percent on both a reported and constant currency(1) basis. Revenue for the six months ended June June: see month. 30, 2006 increased $24 million or 3 percent to $860 million, while earnings per share increased $0.36 or 80 percent. "Our strong and consistent financial performance is directly related to the ability of our people to effectively execute To run a program, which causes the computer to carry out its instructions. See executable code, instruction and EXE file. execute - execution our customer excellence business strategy," said Jim Reid-Anderson, Chairman, 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. , Dade Behring. "We are highly focused on providing practical, relevant solutions to meet the needs of clinical laboratory customers around the globe, which positions us well for 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." Pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta income in the quarter of $57.8 million included $5.0 million of stock-based compensation expense as compared to $1.1 million in the same quarter last year. This expense negatively impacted earnings per share by $0.04 and $0.07 in the second quarter and six months ended June 30, 2006, respectively. A portion of the reported earnings growth was attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to $32.4 million of pre-tax charges related to the company's second quarter, 2005 debt refinancing Refinancing An extension and/or increase in amount of existing debt. , which negatively impacted that period's earnings per share by $0.23. The company's worldwide installed base of instruments grew to 39,300 as of June 30, 2006, a 1.3 percent increase for the quarter and a year-over-year increase of 7.5 percent. Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses , after investing activities and excess tax benefits from stock-based compensation, was $20 million for the second quarter and $66 million June year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. . The company paid a cash dividend of $0.05 per common share totaling $4.3 million during the quarter and repurchased $57 million of its common stock. During the last four quarters the company has repurchased $234 million of its common stock. The first six months of spending for research and development increased $11 million or 15 percent over the same period last year, and represented 9.1 percent of revenue. "An ongoing driver of our success has been new product introductions," said John Duffey, Chief Financial Officer and Senior Vice President, Dade Behring. "Investing in new technology is a high priority for us, given our goal of creating 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. value for shareholders." Cash earnings per share(2) was $0.68 and $1.32 for the second quarter and six months ended June 30, 2006, an increase of 70 percent and 37 percent, respectively. Second Quarter, 2006 Revenue Details: --U.S. sales increased 6.8 percent with 9.5 percent growth in 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. , service and operating lease Operating Lease A lease contract that allows the use of an asset, but does not convey rights similar to ownership of the asset. Notes: An operating lease is not capitalized it is accounted for as a rental expense. revenue. --Revenue outside the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. increased 3.5 percent on a constant currency basis --The chemistry, hemostasis hemostasis /he·mo·sta·sis/ (he?mo-sta´sis) (he-mos´tah-sis) 1. the arrest of bleeding by the physiological properties of vasoconstriction and coagulation or by surgical means. 2. and microbiology microbiology: see biology. microbiology Scientific study of microorganisms, a diverse group of simple life-forms including protozoans, algae, molds, bacteria, and viruses. product lines generated strong growth. Second Quarter 2006 Announcements: During the second quarter, the company announced it had granted rights to American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of Diagnostica for the in vitro in vitro /in vi·tro/ (in ve´tro) [L.] within a glass; observable in a test tube; in an artificial environment. in vi·tro adj. In an artificial environment outside a living organism. diagnostic use of Factor VII factor VII n. A factor in the clotting of blood that forms a complex with tissue thromboplastin and calcium to activate the prothrombinase, thus acting to accelerate the conversion of prothrombin to thrombin. -activating protease protease /pro·te·ase/ (pro´te-as) endopeptidase. pro·te·ase n. Any of various enzymes, including the proteinases and peptidases, that catalyze the hydrolytic breakdown of proteins. (FSAP FSAP Financial Sector Assessment Program (IMF and World Bank assessment of a country's financial system) FSAP Financial Sector Assessment Programme (finance) FSAP Full Spectrum Active Protection ) for the development of early stage cardiovascular disease Cardiovascular disease Disease that affects the heart and blood vessels. Mentioned in: Lipoproteins Test cardiovascular disease tests and to study the role of FSAP in coagulation disorders Coagulation Disorders Definition Coagulation disorders deal with disruption of the body's ability to control blood clotting. The most commonly known coagulation disorder is hemophilia, a condition in which patients bleed for long periods of time before . The company also announced the cardiac-specific CardioPhase(R) hsCRP hsCRP High-Sensitivity C-Reactive Protein hsCRP Highly Sensitive C-Reactive Protein test for the Dimension(R) integrated chemistry systems. This cardiac cardiac /car·di·ac/ (-ak) 1. pertaining to the heart. 2. pertaining to the cardia. car·di·ac adj. 1. Of, near, or relating to the heart. 2. specific high sensitivity C-reactive protein high sensitivity C-reactive protein Lab medicine A method of measuring CRP, with higher sensitivity; HSCRP identifies Pts at risk for stroke, cardiovascular and peripheral vascular disease. See C-reactive protein. (hsCRP) test has been cleared by the FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. for both risk assessment of future cardiovascular disease and risk stratification risk stratification Medical decision-making The constellation of activities–eg, lab and clinical testing used to determine a person's risk for suffering a particular condition and need–or lack thereof–for preventive intervention for the prognosis prognosis /prog·no·sis/ (prog-no´sis) a forecast of the probable course and outcome of a disorder.prognos´tic prog·no·sis n. pl. prog·no·ses 1. of recurrent recurrent /re·cur·rent/ (re-kur´ent) [L. recurrens returning] 1. running back, or toward the source. 2. returning after remissions. re·cur·rent adj. 1. events. In addition, during the quarter, the company announced it has been awarded the Premier Inc. Healthcare Alliance 2006 Pinnacle pinnacle (pĭn`ĭkəl), minor architectural motif of vertical tapering shape, usually crowning a pier, buttress, or gable. Although sometimes it appears in Renaissance design, as in the Certosa di Pavia, it is almost exclusively a medieval Award for supplier performance. The 2006 Pinnacle Award was presented to nine companies out of an eligible 400 contracted suppliers based upon meeting and exceeding the expectations of Premier and its members. About Dade Behring With 2005 revenue of nearly $1.7 billion, Dade Behring is the world's largest company solely dedicated to clinical 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 . It offers a wide range of products, systems and services designed to meet the day-to-day day-to-day adj. 1. Occurring on a routine or daily basis: the day-to-day movements of the stock market. 2. needs of laboratories, delivering innovative solutions to customers and enhancing the quality of life for patients. Additional company information is available on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at www.dadebehring.com.
1. "Constant currency" is not a U.S. GAAP defined measure. The company
believes this measure provides a meaningful analysis of the underlying
activity, since it eliminates the effect of changes in foreign
currency exchange rates. Changes on a constant currency basis have
been calculated by comparing reported current year amounts to prior
year amounts in local currency translated at the foreign currency
exchange rates for the current year. "Constant currency," as defined
or presented by the company, may not be comparable to similarly titled
measures reported by other companies.
2. "Cash earnings per share" is not a U.S. GAAP defined measure. The
company believes this measure provides meaningful profitability
metrics, given current accumulated tax loss carryforwards and the net
depreciation/amortization impacts relating to the revaluation of
assets during the company's 2002 restructuring.
Dade Behring Holdings, Inc.
Revenue By Product Line
and Region (unaudited)
(Dollars in millions)
Quarter Ended June 30,
------------------------------------------
% Change
---------------------
On a
Constant
Currency
Product Line 2006 2005 Reported Basis (a)
-------------------------- --------- --------- ---------- ----------
Core Products
Core Chemistry $295.1 $276.9 6.6% 6.5%
Hemostasis 79.9 75.8 5.4% 5.2%
Microbiology 41.2 40.3 2.2% 3.5%
Infectious Disease
Diagnostics 21.8 22.7 -4.0% -4.1%
-------------------------- --------- --------- ---------- ----------
Total Core Products 438.0 415.7 5.4% 5.4%
Non-Core Products 6.5 7.8 -16.7% -21.0%
-------------------------- --------- --------- ---------- ----------
Total $444.5 $423.5 5.0% 5.0%
-------------------------- --------- --------- ---------- ----------
Region
--------------------------
United States $204.1 $191.1 6.8% 6.8%
Non-U.S. 240.4 232.4 3.4% 3.5%
-------------------------- --------- --------- ---------- ----------
Total $444.5 $423.5 5.0% 5.0%
-------------------------- --------- --------- ---------- ----------
Six-Months Ended June 30,
------------------------------------------
% Change
---------------------
On a
Constant
Currency
Product Line 2006 2005 Reported Basis (a)
-------------------------- --------- --------- ---------- ----------
Core Products
Core Chemistry $570.1 $544.2 4.8% 6.3%
Hemostasis 156.8 151.7 3.4% 5.5%
Microbiology 77.3 79.0 -2.2% -0.1%
Infectious Disease
Diagnostics 43.1 44.3 -2.7% 0.3%
-------------------------- --------- --------- ---------- ----------
Total Core Products 847.3 819.2 3.4% 5.2%
Non-Core Products 12.9 17.2 -25.0% -25.6%
-------------------------- --------- --------- ---------- ----------
Total $860.2 $836.4 2.8% 4.6%
-------------------------- --------- --------- ---------- ----------
Region
--------------------------
United States $399.4 $378.1 5.6% 5.6%
Non-U.S. 460.8 458.3 0.5% 3.7%
-------------------------- --------- --------- ---------- ----------
Total $860.2 $836.4 2.8% 4.6%
-------------------------- --------- --------- ---------- ----------
(a) "Constant currency" is not a U.S. GAAP defined measure. The
company believes this measure provides a meaningful analysis of
the underlying activity, since it eliminates the effect of changes
in foreign currency exchange rates. The change in sales on a
constant currency basis has been calculated by comparing reported
current year sales to prior year sales in local currency
translated at the foreign currency exchange rates for the current
year. "Constant currency," as defined or presented by the company,
may not be comparable to similarly titled measures reported by
other companies.
Dade Behring Holdings, Inc.
Consolidated Balance Sheets (unaudited)
(Dollars in millions, except share- June 30, December 31,
related data) 2006 2005
----------------------------------------- ------------ ------------
Assets
------
Current assets:
Cash and cash equivalents $23.4 $34.6
Accounts receivable, net 355.2 315.7
Inventories 187.2 165.0
Prepaid expenses and other current
assets 21.7 24.5
Deferred income taxes 51.6 54.2
----------------------------------------- ------------ ------------
Total current assets 639.1 594.0
Property, plant and equipment, net 452.1 429.5
Deferred income taxes 200.0 199.3
Identifiable intangible assets, net 351.0 356.9
Goodwill 176.7 187.8
Other assets 31.2 33.1
----------------------------------------- ------------ ------------
Total assets $1,850.1 $1,800.6
----------------------------------------- ------------ ------------
Liabilities and Shareholders' Equity
------------------------------------
Current liabilities:
Short-term debt $9.3 $5.5
Accounts payable 68.0 75.4
Accrued liabilities 249.2 248.8
----------------------------------------- ------------ ------------
Total current liabilities 326.5 329.7
Long-term debt 418.6 386.0
Deferred income taxes 20.2 16.6
Other liabilities 178.2 159.9
----------------------------------------- ------------ ------------
Total liabilities 943.5 892.2
Commitments and contingencies
Shareholders' equity:
Common stock: $.01 par value; 150,000,000
shares authorized at June 30, 2006 and
December 31, 2005, respectively; 86,272,714
and 88,029,061 shares issued and
outstanding at June 30, 2006 and
December 31, 2005, respectively 0.9 0.9
Additional paid-in capital 623.5 708.8
Unearned stock-based compensation - (3.6)
Retained earnings 259.4 196.3
Accumulated other comprehensive income 22.8 6.0
----------------------------------------- ------------ ------------
Total shareholders' equity 906.6 908.4
----------------------------------------- ------------ ------------
Total liabilities and shareholders'
equity $1,850.1 $1,800.6
----------------------------------------- ------------ ------------
Dade Behring Holdings, Inc.
Consolidated Statements of Operations (unaudited)
Quarter Ended Period Ended
(Dollars in millions, except per June 30, June 30,
share data) 2006 2005 2006 2005
-------------------------------- -------- -------- -------- --------
Net sales $444.5 $423.5 $860.2 $836.4
Cost of goods sold 198.3 181.4 381.4 371.1
-------------------------------- -------- -------- -------- --------
Gross profit 246.2 242.1 478.8 465.3
Operating costs and expenses:
Marketing and administrative
expenses 141.2 140.8 278.4 276.0
Research and development
expenses 41.1 34.5 78.5 68.0
-------------------------------- -------- -------- -------- --------
Income from operations 63.9 66.8 121.9 121.3
Other income (expense):
Interest expense (5.7) (18.1) (12.1) (30.5)
Interest income 1.4 1.7 2.5 2.6
Foreign exchange (loss) gain (1.7) (0.1) 0.3 (2.3)
Loss on redemption/purchase of
senior subordinated notes - (24.0) - (24.0)
Other (0.1) - (0.4) (0.8)
-------------------------------- -------- -------- -------- --------
Income before income tax expense 57.8 26.3 112.2 66.3
Income tax expense 20.2 9.2 40.4 24.0
-------------------------------- -------- -------- -------- --------
Net income $37.6 $17.1 $71.8 $42.3
-------------------------------- -------- -------- -------- --------
Basic shares outstanding 86.9 88.8 87.3 88.4
million million million million
Diluted shares outstanding 88.3 93.2 88.9 93.0
million million million million
Basic earnings per common share $0.43 $0.19 $0.82 $0.48
-------- -------- -------- --------
Diluted earnings per common
share $0.43 $0.18 $0.81 $0.45
-------- -------- -------- --------
----------------------------------------------------------------------
Operating Cash Flow to Cash
Earnings reconciliation:
Operating Cash Flow $53.5 $54.9 $128.5 $105.7
Net changes in balance sheet
items not in earnings; loss
on disposal of fixed assets 29.1 10.6 30.3 27.9
Capital expenditures and
investment in licensing
agreements (39.4) (33.0) (75.6) (60.7)
Income tax expense 20.2 9.2 40.4 24.0
Cash paid during the period
for taxes (3.8) (4.4) (6.6) (7.6)
-------------------------------- -------- -------- -------- --------
Cash Earnings (b) $59.6 $37.3 $117.0 $89.3
-------------------------------- -------- -------- -------- --------
Net income to Cash Earnings
reconciliation:
Net income $37.6 $17.1 $71.8 $42.3
Depreciation and amortization
(including amortization
of debt issuance costs) 40.0 47.3 77.0 88.7
Capital expenditures and
investment in licensing
agreements (39.4) (33.0) (75.6) (60.7)
Stock-based compensation
expense 5.0 1.1 10.0 2.6
Income tax expense 20.2 9.2 40.4 24.0
Cash paid during the period
for taxes (3.8) (4.4) (6.6) (7.6)
-------------------------------- -------- -------- -------- --------
Cash Earnings (b) $59.6 $37.3 $117.0 $89.3
-------------------------------- -------- -------- -------- --------
(b) "Cash earnings" is not a U.S. GAAP defined measure. The company
believes this measure provides meaningful profitability metrics,
given current accumulated tax loss carryforwards and the net
depreciation/amortization impacts relating to the revaluation of
assets during the company's 2002 restructuring.
Dade Behring Holdings, Inc.
Consolidated Statements of Cash Flows (unaudited)
Period Ended Period Ended
June 30, June 30,
(Dollars in millions) 2006 2005
------------------------------------------ ------------ ------------
Operating Activities:
Net income $71.8 $42.3
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
expense 77.0 88.7
Net loss on disposal of fixed assets 2.6 1.1
Stock-based compensation expense 10.0 2.6
Deferred income taxes 16.8 12.6
Changes in balance sheet items (49.7) (41.6)
------------------------------------------ ------------ ------------
Net cash flow provided by operating
activities 128.5 105.7
------------------------------------------ ------------ ------------
Investing Activities:
Capital expenditures (75.0) (58.5)
Investment in licensing agreements (0.6) (2.2)
------------------------------------------ ------------ ------------
Net cash flow utilized for investing
activities (75.6) (60.7)
------------------------------------------ ------------ ------------
Financing Activities:
Net borrowings (repayments) related to
short-term debt 3.6 (7.5)
Repayments of borrowings under former bank
credit agreement - (158.3)
Redemption/purchase of senior subordinated
notes - (275.0)
Borrowings under new revolving credit
facility 323.7 452.1
Repayments of borrowings under new
revolving credit facility (291.1) (56.1)
Payment of debt issuance costs - (2.7)
Proceeds from exercise of stock options 11.4 10.8
Proceeds from employee stock purchase plan 5.2 4.7
Excess tax benefits from stock-based
compensation 12.9 -
Repurchases of common stock (121.8) -
Dividends paid (8.7) (2.7)
------------------------------------------ ------------ ------------
Net cash flow utilized for financing
activities (64.8) (34.7)
------------------------------------------ ------------ ------------
Effect of foreign exchange rates on cash 0.7 (0.8)
------------------------------------------ ------------ ------------
Net (decrease) increase in cash and cash
equivalents (11.2) 9.5
Cash and Cash Equivalents:
Beginning of Period 34.6 30.0
------------------------------------------ ------------ ------------
End of Period $23.4 $39.5
------------------------------------------ ------------ ------------
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