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Hologic Announces First Quarter Fiscal 2013 Operating Results

        Hologic Announces First Quarter Fiscal 2013 Operating Results

Record Revenues and Adjusted Net Income

PR Newswire

BEDFORD, Mass., Feb. 4, 2013

BEDFORD, Mass., Feb. 4, 2013 /PRNewswire/ --Hologic, Inc. (Hologic or the
Company) (NASDAQ: HOLX), a leading developer, manufacturer and supplier of
premium diagnostics products, medical imaging systems and surgical products
dedicated to serving the healthcare needs of women, today announced its
results for the first fiscal quarter ended December 29, 2012.

Highlights of the Quarter Include:

  oRevenues of $631.4 million, net of a $(13.3) million adjustment primarily
    related to contingent revenue earned and received under Gen-Probe
    Incorporated's (Gen-Probe) collaboration agreement with Novartis.
  oNon-GAAP adjusted revenues of $644.6 million, increased to include the
    aforementioned $13.3 million net adjustment.
  oYear-over-year revenue growth in the Company's three primary business
    segments, Breast Health, Diagnostics and GYN Surgical, which represented
    over 96% of revenues.
  oNet income of $3.1 million, or $0.01 per diluted share, calculated in
    accordance with U.S. generally accepted accounting principles (GAAP).
  oNon-GAAP adjusted net income of $101.8 million, or $0.38 per diluted
    share, and adjusted EBITDA (non-GAAP adjusted earnings before interest,
    taxes, depreciation and amortization) of $227.5 million.
  oU.S. Food and Drug Administration (FDA) Approval of the APTIMA 16 18/45
    Genotype Assay for use on the TIGRIS System announced on October 16, 2012.
  o$60 million cash settlement received on December 28, 2012 from K-V
    Pharmaceutical Company (KV) in full satisfaction and discharge of all
    Hologic claims against KV.

Highlights Subsequent to the Quarter Include:

  oOslo study published on January 7, 2013, in Radiology, reporting the
    addition of the Company's 3D mammography screening technology to a 2D
    breast screening exam significantly increased cancer detection while
    reducing the number of false positives.
  oFDA clearance of the Company's APTIMA Trichomonas vaginalis Assay for use
    on its fully-automated PANTHER System announced on January 14, 2013.
  oFDA clearance of the Company's contrast-enhanced digital mammography for
    improved visualization of breast tissue announced today.
  oDefinitive agreement announced on January 3, 2013, to sell the Company's
    LIFECODES business to Immucor, Inc. for $85 million in cash, subject to
    adjustment, and $10 million in a potential contingent payment.

A reconciliation of historical GAAP to non-GAAP results is included as an
attachment to this press release.

"We began fiscal 2013 with great promise and we are confident our combination
with Gen-Probe positions us to continue creating significant value for all of
our stakeholders," said Rob Cascella, President and Chief Executive Officer.
"During the quarter, we leveraged our expanded product portfolio to drive
year-over-year growth in our Diagnostics, Breast Health and GYN Surgical
segments. We are executing the strategy we outlined at the beginning of the
year and we believe we are well positioned to build on our momentum for the
remainder of fiscal 2013 and beyond."

First Quarter Fiscal 2013 Operating Results Overview:

First quarter fiscal 2013 revenues totaled $631.4 million. Excluding the
effect of a net adjustment of $(13.3), primarily related to purchase
accounting, non-GAAP adjusted revenues were $644.6 million, an increase of
36.4% compared to revenues of $472.7 million in the first quarter of fiscal
2012. This adjustment primarily related to contingent revenue earned and
received under Gen-Probe's collaboration agreement with Novartis, for which
the cash was collected by the Company following the acquisition. If not for
this purchase accounting adjustment, the Company would have recognized
revenues on these receipts in the first quarter of fiscal 2013.

The increase in revenues was driven by:

  oGrowth in Diagnostics non-GAAP adjusted revenues of $165.1 million, or
    107.2%, primarily from the inclusion of Gen-Probe revenues for a full
    quarter and an increase in Hologic's legacy Diagnostics revenues. Legacy
    Diagnostics revenue growth occurred primarily in the molecular diagnostics
    product lines and international ThinPrep sales;
  oGrowth in Breast Health revenues of $5.5 million, or 2.5%, primarily from
    an increase in service revenue from the Company's increased installed base
    of digital mammography systems, partially offset by a reduction in product
    revenues; and
  oGrowth in GYN Surgical revenues of $2.4 million, or 3.0%, primarily from
    an increase in MyoSure hysteroscopic tissue removal (MyoSure) system
    sales, partially offset by the Company's decision in the second quarter of
    fiscal 2012 to discontinue sales of its Adiana permanent contraception
    (Adiana) system.

The impact on revenues from changes in foreign currencies compared with the
first quarter of fiscal 2012 was a reduction of approximately $0.3 million.

First quarter fiscal 2013 net income was $3.1 million, or $0.01 per diluted
share, compared with net income of $20.8 million, or $0.08 per diluted share,
in the first quarter of fiscal 2012. The Company's non-GAAP adjusted net
income increased 13.0% to $101.8 million, or $0.38 per diluted share, in the
first quarter of fiscal 2013 compared to $90.0 million, or $0.34 per diluted
share, for the same period in the prior year. Included in the Company's
non-GAAP adjusted net income for the first quarter of fiscal 2013 was a
benefit of $0.01 from the recently-reinstated federal research tax credit. For
GAAP purposes, this benefit will be reflected in results beginning in the
second fiscal quarter.

Non-GAAP adjusted revenues, non-GAAP adjusted net income, non-GAAP adjusted
earnings per diluted share (EPS), and adjusted EBITDA are non-GAAP financial
measures. The Company's definitions of these non-GAAP financial measures, and
the reconciliations of these historical measures to the Company's comparable
GAAP financial measures for the periods presented, are set forth in the
supplemental information attached to this press release. When analyzing the
Company's operating performance, investors should not consider these non-GAAP
measures as a substitute for the comparable financial measures prepared in
accordance with GAAP.

"Looking ahead, we believe Hologic's diverse, innovative products will
continue to gain traction in the marketplace by exceeding the expectations of
our customers and addressing the needs of our patients," said Rob Cascella.
"We have leadership across our business segments and the resources and
capabilities to support our long-term growth strategy."

First Quarter Fiscal 2013 Revenue Overview by Segment (As Compared to the
First Quarter Fiscal 2012):

  oDiagnostics revenues totaled $305.9 million in the current quarter, net of
    the $13.3 million reduction primarily for the effect of purchase
    accounting related to Gen-Probe's collaboration agreement with Novartis
    that was eliminated under GAAP, compared to $154.1 million in the prior
    year. Including the $13.3 million, non-GAAP adjusted revenues totaled
    $319.2 million, an increase of 107.2%. Sales growth was driven primarily
    by the inclusion of Gen-Probe revenues for a full quarter and, to a lesser
    extent, strong growth in Hologic's legacy molecular diagnostics revenues
    as well as an increase in international ThinPrep sales.
  oBreast Health revenues totaled $220.8 million in the current quarter
    compared to $215.4 million in the prior year, an increase of 2.5%. Revenue
    growth was driven by an $8.6 million, or 12.2%, increase in service
    revenues from the Company's growing installed base of digital mammography
    systems, partially offset by a reduction in product revenues of $3.2
    million, or 2.2%.
  oGYN Surgical revenues totaled $80.9 million in the current quarter
    compared to $78.5 million in the prior year, an increase of 3.0%. The
    increase was driven primarily by an increase in MyoSure system sales,
    partially offset by a $5.1 million reduction in Adiana system revenues due
    to the Company's decision in the second quarter of fiscal 2012 to
    discontinue sales of that product line and, to a lesser extent, a slight
    decrease in NovaSure system sales. Excluding Adiana revenues in both
    periods, the increase in GYN Surgical revenues was approximately 10.1%.
  oSkeletal Health revenues totaled $23.7 million in the current quarter
    compared to $24.7 million in the prior year, a decrease of 4.1%. This
    decrease was primarily the result of a slight reduction in product and
    service revenues.

Publication of the Oslo Tomosynthesis Screening Trial Results:

On January 7, 2013, results from the first large-scale, peer-reviewed
prospective clinical study of its kind were published online, in advance of
print, by Radiology, the Radiological Society of North America scientific
journal. The researchers reported that the addition of Hologic's 3D
mammography (breast tomosynthesis) screening technology to a 2D breast
screening exam significantly increased cancer detection, particularly for
invasive cancers, and simultaneously decreased the false-positive rates. Some
of the significant findings reported include:

  oA 40% increase in the detection of invasive breast cancers
  oA 27% increase in the detection of all cancers (invasive and in situ
    cancers combined)
  oA 15% decrease in false‐positive rates
  oAn increase in cancer detection across all breast tissue densities, from
    dense to fatty
  oAll of the above achieved with no increase in the detection of ductal
    carcinoma in situ, which is non-invasive and cited as potentially being
    over-diagnosed.

New Products:

APTIMA HPV 16 18/45 Genotype Assay for use on TIGRIS:

On October 16, 2012, the Company announced FDA approval of its APTIMA HPV 16
18/45 Genotype Assay for use on its TIGRIS System. Hologic's APTIMA HPV 16
18/45 Genotype Assay is the first test FDA-approved for genotyping all three
human papillomavirus (HPV) types 16, 18 and/or 45, which are associated with
approximately 80% of all invasive cervical cancers worldwide. Detecting these
HPV types provides health care professionals with more information regarding a
patient's risk of subsequently developing cervical cancer. The APTIMA HPV
Assay received FDA approval in 2011 and was CE marked in 2008.

APTIMA Trichomonas vaginalis Assay for use on PANTHER:

On January 14, 2013, the Company announced FDA clearance of its APTIMA
Trichomonas vaginalis Assay for use on its fully-automated PANTHER System. The
APTIMA Trichomonas vaginalis Assay, first cleared for use on Hologic's TIGRIS
System in April 2011, remains the only FDA-cleared amplified nucleic acid test
on the market specifically cleared to detect Trichomonas vaginalis.
Trichomonas is a sexually transmitted parasite estimated to cause 7.4 million
infections in the U.S. annually and has been linked to several serious health
issues. Hologic's assay may be used to test clinician-collected endocervical
or vaginal swabs and specimens collected in Hologic's ThinPrep vial from
symptomatic or asymptomatic women.

Contrast-Enhanced Digital Mammography System:

Today the Company announced FDA clearance of its contrast-enhanced digital
mammography (CEDM) system. CEDM is a procedure in which a contrast agent is
injected into the patient prior to the mammography exam in order to enhance
breast imaging. This imaging technique can be used as an adjunct to digital
mammography to localize a known or suspected lesion. CEDM has the potential
for better sensitivity versus conventional full-field digital mammography, or
2D mammography, alone. The Company intends to launch this product later this
fiscal year as an upgrade to the Company's Dimensions platform.

Definitive Agreement to Sell LIFECODES:

On January 3, 2013, the Company announced it signed a definitive agreement to
sell its LIFECODES business unit to Immucor, Inc. for $85 million in cash at
closing, subject to certain adjustments, and have the opportunity to earn a
contingent payment of $10 million based on achievement of certain financial
targets for calendar year 2013. The transaction is subject to customary
closing conditions, including expiration of the applicable waiting periods
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, as
well as international regulatory review. The transaction is expected to close
during the second fiscal quarter.

Settlement of K-V Pharmaceutical Claim:

Hologic had previously submitted claims against K-V Pharmaceutical Company
arising out of its Asset Purchase Agreement with KV, relating to Hologic's
sale of its pharmaceutical product Makena and related assets to KV. On
December 28, 2012, KV paid Hologic $60 million in full satisfaction and
discharge of all Hologic claims against KV. Hologic recognized a gain of $53.9
million, net of related costs, in the Company's first fiscal quarter. This
gain has been excluded from the Company's non-GAAP net income.

Federal Research Tax Credit:

On January 2, 2013, federal legislation was passed that extends the federal
research tax credit for two years, starting retroactively from January 1,
2012. The Company will record this cumulative adjustment in its GAAP results
in the second quarter of fiscal 2013.

Financial Guidance:

The Company's guidance includes current operations, including revenues from
its approved/cleared products and its recently acquired businesses.

Second Quarter Fiscal 2013 (Quarter Ending March 30, 2013):

  oThe Company expects second quarter fiscal 2013 non-GAAP adjusted revenues
    of $635 million to $640 million (excludes an expected purchase accounting
    reduction of $5.2 million related to the Novartis collaboration).
    Year-over-year, this represents an expected increase of 35% to 36% over
    second quarter fiscal 2012 revenues of $471.2 million. The increase is
    driven primarily by the inclusion of revenues related to the Gen-Probe
    acquisition, the continued ramp-up of new products including the
    Dimensions, PANTHER, and MyoSure systems and an expected overall
    improvement in each of the Company's operating segments, partially offset
    by an elimination in Adiana system revenues and revenues associated with
    LIFECODES which is expected to be sold during the quarter.
  oThe Company expects non-GAAP adjusted EPS of $0.33 to $0.34. This reflects
    the expected benefit of approximately $0.01 from the recently-reinstated
    federal research tax credit, offset by the expected impact of the medical
    device excise tax which is expected to be $0.02 dilutive.

Fiscal 2013 (Year Ending September 28, 2013):

  oThe Company is reaffirming expected fiscal 2013 non-GAAP adjusted revenues
    of $2.61 billion to $2.64 billion. Year-over-year this represents an
    expected increase of 30% to 31% over fiscal 2012 non-GAAP revenues of
    $2.01 billion. This increase is driven primarily by revenues related to
    the Gen-Probe acquisition and, to a lesser extent, increases in the Breast
    Health, GYN Surgical and legacy Diagnostics segments, partially offset by
    a reduction in Adiana system revenues.
  oThe Company expects non-GAAP adjusted EPS of $1.58 to $1.60. This is $0.02
    higher than the guidance provided on November 12, 2012 due to the
    recently-reinstated federal research tax credit, partially offset by a
    slight increase in expected operating expenses.

Hologic may not generate expected revenues and may incur expenses or charges,
realize income or gains, or execute acquisitions or dispositions in fiscal
2013 that could cause actual results to vary from the guidance above. In
addition, the Company is continuing to monitor the effects of the U.S.,
European and general worldwide economic and regulatory conditions and related
uncertainties, including the implementation of healthcare cost containment
measures and healthcare reform legislation, as well as foreign currency
fluctuations, which, along with other uncertainties facing the Company's
business including those referenced elsewhere herein and its filings with the
Securities and Exchange Commission, could adversely affect anticipated
results.

Conference Call and Webcast:

Hologic's management will host a conference call on Monday, February 4, 2013,
at 5:00 p.m. (Eastern) to discuss first quarter fiscal year 2013 operating
results. Interested participants may listen to the call by dialing
888-523-1227 or 719-457-2632 for international callers and referencing code
5124529 approximately 15 minutes prior to the call. For those unable to
participate in the live broadcast, a replay will be available one hour after
the call ends through Friday, February 22, 2013, at 888-203-1112 or
719-457-0820 for international callers, access code 5124529. The Company will
also provide a live webcast of the call. Interested participants may access
the webcast on the Company's website at www.hologic.com/investors-overview. A
PowerPoint presentation related to the conference call has been posted to the
site.

About Hologic, Inc.:

Hologic, Inc. is a leading developer, manufacturer and supplier of premium
diagnostic products, medical imaging systems, and surgical products.The
Company operates four core business units focused on breast health,
diagnostics, GYN surgical and skeletal health.With a comprehensive suite of
technologies and a robust research and development program, Hologic is
committed to improving lives.The Company is headquartered in Massachusetts.
For more information, visit www.hologic.com.

Hologic, Adiana, APTIMA, Dimensions, Gen-Probe, LIFECODES, MyoSure, NovaSure,
PANTHER, ThinPrep and TIGRIS and associated logos are trademarks and/or
registered trademarks of Hologic, Inc. and/or its subsidiaries in the United
States and/or other countries. Makena is a registered trademark of KV.

Forward-Looking Statement Disclaimer:

This News Release contains forward-looking information that involves risks and
uncertainties, including statements about the Company's plans, objectives,
expectations and intentions. Such statements include, without limitation:
financial or other information included herein based upon or otherwise
incorporating judgments or estimates relating to future performance, events or
expectations; the Company's positioning, resources, capabilities,and
expectations for future growth; the anticipated benefits of the Gen-Probe
acquisition; and the Company's outlook and financial and other guidance. These
forward-looking statements are based upon assumptions made by the Company as
of the date hereof and are subject to known and unknown risks and
uncertainties that could cause actual results to differ materially from those
anticipated.

Risks and uncertainties that could adversely affect the Company's business and
prospects, and otherwise cause actual results to differ materially from those
anticipated, include without limitation: U.S., European and general worldwide
economic conditions and related uncertainties; the Company's reliance on
third-party reimbursement policies to support the sales and market acceptance
of its products, including the possible adverse impact of government
regulation and changes in the availability and amount of reimbursement and
uncertainties for new products or product enhancements; uncertainties
regarding the recently enacted or future healthcare reform legislation,
including associated tax provisions, or budget reduction or other cost
containment efforts; changes in guidelines, recommendations and studies
published by various organizations that could affect the use of the Company's
products; uncertainties inherent in the development of new products and the
enhancement of existing products, including FDA approval and/or clearance and
other regulatory risks, technical risks, cost overruns and delays; the risk
that products may contain undetected errors or defects or otherwise not
perform as anticipated; risks associated with acquisitions, including without
limitation, the Company's ability to successfully integrate acquired
businesses, the risks that the acquired businesses may not operate as
effectively and efficiently as expected even if otherwise successfully
integrated, the risks that acquisitions may involve unexpected costs or
unexpected liabilities, including the risks and challenges associated with the
Company's recent acquisition of Gen-Probe and operations in China;
manufacturing risks, including the Company's reliance on a single or limited
source of supply for key components, and the need to comply with especially
high standards for the manufacture of many of its products; the Company's
ability to predict accurately the demand for its products, and products under
development, and to develop strategies to address its markets successfully;
the early stage of market development for certain of the Company's products;
the Company's leverage risks, including the Company's obligation to meet
payment obligations and financial covenants associated with its debt; risks
related to the use and protection of intellectual property; expenses,
uncertainties and potential liabilities relating to litigation, including,
without limitation, commercial, intellectual property, employment and product
liability litigation; technical innovations that could render products
marketed or under development by the Company obsolete; competition; the risks
of conducting business internationally, including the effect of exchange rate
fluctuations on those operations; and the Company's ability to attract and
retain qualified personnel.

The risks included above are not exhaustive. Other factors that could
adversely affect the combined company's business and prospects are described
in the filings made by the Company with the SEC. The Company expressly
disclaims any obligation or undertaking to release publicly any updates or
revisions to any such statements presented herein to reflect any change in
expectations or any change in events, conditions or circumstances on which any
such statements are based.

HOLOGIC, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
                               December 29, 2012        September 29, 2012
ASSETS
CURRENT ASSETS:
Cash and cash equivalents      $             $         
                                 720,565             566,126
Accounts receivable, net       405,653                  409,333
Inventories                    345,309                  367,191
Deferred income tax assets     -                        11,715
Prepaid expenses and other     188,709                  208,649
current assets
Total current assets           1,660,236                1,563,014
Property and equipment, net    504,071                  507,998
Intangible assets, net         4,195,538                4,301,250
Goodwill                       3,941,430                3,942,779
Other assets                   167,280                  162,067
                               $              $       
                               10,468,555              10,477,108
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES:
Accounts payable               $             $          
                                  76,367             87,223
Accrued expenses               443,686                  380,003
Deferred revenue               121,152                  129,688
Current portion of long-term   798,937                  64,435
debt
Deferred income tax            111,611                  -
liabilities
Total current liabilities      1,551,753                661,349
Long-term debt, net of current 4,237,085                4,971,179
portion
Deferred income tax            1,576,472                1,771,585
liabilities
Deferred service obligations-  16,440                   13,714
long term
Other long-term liabilities    102,429                  98,250
Total long-term liabilities    5,932,426                6,854,728
STOCKHOLDERS' EQUITY:
Common stock                   2,674                    2,656
Additional paid-in capital     5,415,454                5,396,657
Accumulated deficit            (2,440,436)              (2,443,554)
Accumulated other              8,202                    6,790
comprehensive income
Treasury stock, at cost        (1,518)                  (1,518)
Total stockholders' equity     2,984,376                2,961,031
                               $              $       
                               10,468,555              10,477,108



HOLOGIC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
                                 Three Months Ended
                                 December 29, 2012              December 24,
                                                                2011
REVENUES
                                 $                  $      
Product sales                     535,202                           
                                                                392,096
Service and other revenues       96,160                         80,615
                                 631,362                        472,711
COSTS AND EXPENSES (1):
Cost of product sales            223,493                        131,944
Cost of product sales –
amortization of intangible       75,287                         46,171
assets
Cost of service and other        50,909                         45,226
revenues
Research and development        51,509                         28,342
Selling and marketing           94,443                         77,460
General and administrative      54,391                         46,495
Contingent consideration         39,526                         15,563
Amortization of intangible       28,526                         14,842
assets
Gain on sale of intellectual     (53,884)                       -
property, net
Restructuring                    3,933                          (91)
                                 568,133                        405,952
Income from operations          63,229                         66,759
Interest expense, net            (72,081)                       (29,509)
Other income, net                1,499                          2,654
(Loss) income before income      (7,353)                        39,904
taxes
(Benefit) provision for income   (10,471)                       19,092
taxes
                                 $                  $      
Net income                          3,118                          
                                                                20,812
Net income per share:
                                 $                  $      
Basic                                0.01                         
                                                                  0.08
                                 $                  $      
Diluted                              0.01                         
                                                                  0.08
Weighted average number of
shares outstanding:
Basic                            266,344                        262,717
Diluted                          269,379                        264,958
(1) Stock-based compensation included in costs and expenses
during the three months ended December 29, 2012 was $1,834 for
cost of revenues, $1,868 for research and development, $2,201
for selling and marketing, $5,941 for general and
administrative and $222 for restructuring. Stock-based
compensation included in costs and expenses during the three
months ended December 24, 2011 was $1,107 for cost of revenues,
$1,201 for research and development, $1,550 for selling and
marketing and $4,799 for general and administrative.

HOLOGIC, INC.
RECONCILIATION OF GAAP REVENUES, EPS AND NET INCOME TO NON-GAAP ADJUSTED
REVENUES, EPS, NET INCOME AND EBITDA
(Unaudited)
(In thousands, except earnings per share)
                                Three Months Ended
                                December 29, 2012       December 24, 2011
REVENUES
                                $        
GAAP revenues                        
                                631,362
Adjustment related to Novartis  13,275            (1)
collaboration and other, net
                                $        
Non-GAAP adjusted revenues           
                                644,637
EARNINGS PER SHARE
GAAP earnings per share-        $               $        
Diluted                                                
                                 0.01                   0.08
Adjustments to net income (as   0.37                    0.26
detailed below)
Non-GAAP adjusted earnings per  $               $        
share- Diluted                           (2)            (2)
                                 0.38                   0.34
NET INCOME
                                $               $        
GAAP net income                                      
                                3,118                   20,812
Adjustments:
Contingent revenue from
Novartis collaboration          13,275                  -
and other, net
Amortization of intangible      103,813           (3)   61,013            (3)
assets
Contingent consideration       39,526            (4)   15,563            (4)
Non-cash interest expense       15,644            (5)   18,953            (5)
relating to convertible notes
Acquisition-related costs       5,521             (6)   1,084             (6)
Restructuring                   3,933             (7)   (91)              (7)
Fair value write up of acquired 29,876            (8)   -
inventory sold
Fair value adjustment for       2,689             (9)   -
depreciation expense
Gain on sale of intellectual    (53,884)          (10)  -
property, net
Other gains                     (3,367)           (11)  -
Income tax effect of            (58,366)          (12)  (27,293)          (13)
reconciling items
                                $               $        
Non-GAAP adjusted net income                             
                                101,778                90,041
EBITDA
                                $               $        
Non-GAAP adjusted net income                             
                                101,778                90,041
Interest expense, net, not      56,177                  9,723
adjusted above
Provision for income taxes      47,895                  46,385
Depreciation expense, not       21,653                  16,110
adjusted above
                                $               $        
Adjusted EBITDA                                        
                                227,503                162,259

Explanatory Notes:

(1) To primarily reflect a fair value adjustment recorded in purchase
accounting relating to contingent revenue earned and received under the
Novartis collaboration post acquisition, which was eliminated under purchase
accounting.

(2) Non-GAAP adjusted earnings per share was calculated based on 269,379 and
264,958 weighted average diluted shares outstanding for the three months ended
December 29, 2012 and December 24, 2011, respectively.

(3) To reflect a non-cash charge attributable to the amortization of
intangible assets.

(4) To reflect a net charge to operating expenses attributable to contingent
consideration related to certain of the Company's acquisitions.

(5) To reflect non-cash interest expense related to the Company's Convertible
Notes.

(6) To reflect certain costs associated with the Company's acquisition(s).

(7) To reflect restructuring and other charges.

(8) To reflect a non-cash adjustment recorded for the fair value write-up of
inventory acquired from Gen-Probe and sold during the current reporting
period.

(9) To reflect a non-cash fair value adjustment for additional depreciation
expense related to the fair value write-up of fixed assets acquired from
Gen-Probe.

(10) To reflect a net gain resulting from the $60 million cash payment
received from KV in final settlement of an agreement, net of costs associated
with this transaction.

(11) To reflect the net impact from miscellaneous transactions during the
period.

(12) To reflect an estimated annual effective tax rate of 32.0% on a non-GAAP
basis. This rate reflects the annual benefit in fiscal 2013 from the
reinstatement of the federal research tax credit.

(13) To reflect an annual effective tax rate of 34.0% on a non-GAAP basis.

Future Non-GAAP Adjustments:

Future GAAP EPS may be affected by changes in ongoing assumptions and
judgments relating to the Company's acquired businesses, and may also be
affected by nonrecurring, unusual or unanticipated charges, expenses or gains,
all of which are excluded in the calculation of non-GAAP adjusted EPS as
described in this press release. It is therefore not practicable to reconcile
non-GAAP adjusted EPS guidance to the most comparable GAAP measure.

Use of Non-GAAP Financial Measures:

The Company has presented the following non-GAAP financial measures in this
press release: adjusted revenues; adjusted net income; adjusted EPS; and
adjusted EBITDA. The Company defines adjusted EBITDA as its non-GAAP adjusted
net income plus interest expense, net, income taxes, and depreciation and
amortization expense included in its non-GAAP adjusted net income. The Company
defines its non-GAAP adjusted revenues to primarily include contingent revenue
earned under the Novartis collaboration post-acquisition which was eliminated
under purchase accounting. The Company defines its non-GAAP adjusted net
income and adjusted EPS to exclude: (i) the amortization of intangible assets;
(ii) acquisition-related charges and effects, such as charges for contingent
consideration (comprised of (a) adjustments for changes in the fair value of
the contingent consideration liabilities initially recorded as part of the
purchase price of an acquisition as required by GAAP, and (b) contingent
consideration that is tied to continuing employment of the former shareholders
and employees which is recorded as compensation expense), transaction costs,
integration costs including retention, and credits and/or charges associated
with the write-up of acquired inventory and fixed assets to fair value, and
the effect of a reduction in revenue related to contingent revenue under the
Novartis collaboration, described above; (iii) non-cash interest expense
related to amortization of the debt discount for convertible debt securities;
(iv) divestiture and restructuring charges; (v) non-cash loss on exchange of
convertible notes; (vi) litigation settlement charges (benefits); (vii)
other-than-temporary impairment losses on investments; and (viii) other
one-time, nonrecurring, unusual or infrequent charges, expenses or gains that
may not be indicative of the Company's core business results; and include
income taxes related to such adjustments.

The Company believes the use of non-GAAP adjusted net revenues is useful to
investors as it eliminates certain effects of purchase accounting on its
recognition of revenue. The Company believes the use of non-GAAP adjusted net
income is useful to investors by eliminating certain of the more significant
effects of its acquisitions and related activities, non-cash charges resulting
from the application of GAAP to convertible debt instruments with cash
settlement features, charges related to debt extinguishment losses, investment
impairments, litigation settlements, and divestiture and restructuring
initiatives. These non-GAAP measures also reflect how Hologic manages its
businesses internally. In addition to the adjustments set forth in the
calculation of the Company's non-GAAP adjusted net income and adjusted EPS,
its non-GAAP adjusted EBITDA eliminates the effects of financing, income taxes
and the accounting effects of capital spending. As with the items eliminated
in its calculation of non-GAAP adjusted net income, these items may vary for
different companies for reasons unrelated to the overall operating performance
of a company's business. When analyzing the Company's operating performance,
investors should not consider these non-GAAP financial measures as a
substitute for net income prepared in accordance with GAAP.

Investor Relations and Media Contacts:
Deborah R. Gordon                  Al Kildani
Vice President, Investor Relations Senior Director, Investor Relations
(781) 999-7716                     (858) 410-8653
deborah.gordon@hologic.com         al.kildani@hologic.com

SOURCE Hologic, Inc.

Website: http://www.hologic.com
 
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