Breaking News

Tweet TWEET

HBIO Reports First Quarter 2013 Results

HBIO Reports First Quarter 2013 Results

HOLLISTON, Mass., May 2, 2013 (GLOBE NEWSWIRE) -- Harvard Bioscience, Inc.
(Nasdaq:HBIO), a global developer, manufacturer, and marketer of a broad range
of tools to advance life science research and regenerative medicine, today
reported unaudited financial results for the three months ended March 31,
2013.

First Quarter Reported Results

Revenues from continuing operations for the three months ended March 31, 2013
were $26.1 million, a decrease of $2.2 million, or 7.9%, compared to revenues
of $28.3 million for the three months ended March 31, 2012. Currency exchange
rates had a negative 0.3% effect on revenues in the first quarter of 2013
compared with the first quarter of 2012. The Company's acquisition of AHN
Biotechnologie GmbH ("AHN") in February 2012 had a positive 0.9% effect on
revenues. Excluding the effects of currency changes and acquisitions, the
Company's organic revenue growth for the first quarter of 2013 was 8.5% below
the same period in the previous year.

Net loss from continuing operations, as measured under U.S. generally accepted
accounting principles ("GAAP"), was $0.1 million, or approximately $0.00 loss
per diluted share for the three months ended March 31, 2013 compared to net
income of $0.5 million, or $0.02 earnings per diluted share, for the same
period in 2012. The unfavorable year-to-year quarterly GAAP earnings
comparison was due to a combination of increased spending in the Company's
development-stage Regenerative Medicine Device ("RMD") business and lower
revenue in our core Life Science Research Tools ("LSRT") business.

Non-GAAP earnings per share from continuing operations for our core LSRT
business for the first quarter of 2013 was $0.08 per diluted share compared
with $0.09 per diluted share for the first quarter of 2012. Non-GAAP earnings
per share from continuing operations for our RMD business for the first
quarter of 2013 was a loss of $0.05 per diluted share, compared with a loss of
$0.03 per diluted share for the first quarter of 2012, and reflected greater
activities in developing this initiative. The Company's total non-GAAP
earnings per share from continuing operations, reflecting LSRT and RMD
combined, was $0.03 per diluted share for the first quarter of 2013 compared
with $0.06 per diluted share for the first quarter of 2012.

Chane Graziano, HBIO's CEO, commented, "Revenues in the first quarter were
disappointing as we saw delays in spending due to sequestration cuts in the
U.S. We believe this is a short term issue since both houses of Congress
appear to agree on the importance of scientific research. Historically, we
have seen an increase in spending once government budgets are approved.
Although revenues were down 8% in the first quarter compared with the first
quarter of 2012, and were below our expectations, the negative comparison was
not as severe as it might appear since the first quarter last year was a
record quarter with strong organic growth in our life science research tools
business. Therefore, it was a difficult year-to-year comparison. In view of
these facts we do not expect to see a decline in revenues for the full year of
2013 in our core business and we expect to see an increase in operating
profits for the year based on the operational improvements we have made."

Mr. Graziano continued, "As per our announcement released last evening, I wish
to confirm our intention to separate our HART business from HBIO, list the
HART shares on the NASDAQ exchange and dividend those shares to the HBIO
shareholders. Once this is complete we will give more detailed guidance on
HBIO for the year. Additionally, as we move to complete this separation of
HART from HBIO we are once again actively pursuing our acquisition strategy to
acquire product lines or companies that are complementary to our base business
and leverage our infrastructure, which will be key to achieving our long term
goal of growing revenues and profits by 15%-20% per year."


Operating Results for Continuing Operations

Three months ended March 31, 2013 compared to three months ended March 31,
2012:

Revenues decreased $2.2 million, or 7.9%, to $26.1 million for the three
months ended March 31, 2013 compared to $28.3 million for the same period in
2013. Our acquisition of AHN contributed approximately $0.3 million to first
quarter 2013 revenues. The effect of a stronger U.S. dollar decreased the
Company's first quarter revenues by $0.1 million, or 0.3%, compared with the
same period in 2012. Adjusting for the effect of foreign currency fluctuation
and acquisitions, revenues were down $2.4 million, or 8.5%, year-to-year. The
organic revenue decline was concentrated in our Harvard Apparatus, Biochrom,
and Hoefer businesses.

Gross profit as a percentage of revenues decreased to 47.0% for the three
months ended March 31, 2013 compared with 47.3% for the same period in 2012.
The decrease in gross profit as a percentage of revenues was primarily due to
a lower sales volume and a less favorable sales mix in the first quarter of
2013 compared with the first quarter of 2012.

Sales and marketing expenses were flat at $4.8 million for the three months
ended March 31, 2013 and 2012. In LSRT, sales and marketing expenses decreased
$0.1 million, or 1.3% to $4.5 million, compared to $4.6 million for the three
months ended March 31, 2012.In RMD, sales and marketing expenses increased
$0.1 million primarily due to an increase in business development efforts.

General and administrative expenses increased $0.2 million, or 4.3%, to $5.1
million for the three months ended March 31, 2013 compared with $4.9 million
for the three months ended March 31, 2012. In LSRT, general and administrative
expenses decreased $0.5 million, or 10.9%, to $4.0 million, compared to $4.5
million for the three months ended March 31, 2012, primarily due to lower
administrative costs across our core LSRT businesses and the recovery of $0.1
million of Hurricane Sandy business interruption costs at our Denville
Scientific business. In RMD, general and administrative expenses increased
$0.7 million due to increased activity in our regenerative medicine device
initiative.

Research and development expenses increased $0.2 million, or 13.2%, to $1.9
million for the three months ended March 31, 2013 compared with $1.7 million
for the same period in 2012. In LSRT, research and development expenses
remained flat at $1.0 million for the three months ended March 31, 2013 and
2012. In RMD, research and development expenses increased $0.3 million due to
increased activity in our bioreactor development initiatives.

Income tax (benefit) expense was $169,000 benefit and $315,000 expense for the
three months ended March 31, 2013 and 2012, respectively. The effective income
tax rate for continuing operations was 66.8% benefit for the three months
ended March31, 2013, compared with 37.3% expense for the same period in 2012.
The effective tax rate for the first quarter of 2013 included benefits related
to foreign tax rate differential, research and development tax credits and
stock compensation exercises, as well as offsetting discrete expense items
related to certain non-deductible costs.

Balance Sheet

The Company ended the first quarter of 2013 with cash and cash equivalents of
$23.7 million compared to $20.7 million at December 31, 2012. As of March 31,
2013 and December 31, 2012, the Company had borrowings of $15.0 million and
$13.0 million, respectively, outstanding under its credit facility. Total cash
and equivalents, net of debt, was $8.7 million and $7.7 million at March 31,
2013 and December 31, 2012, respectively.

Trade receivables were $14.2 million and inventories were $17.7 million as of
March 31, 2013 compared to trade receivables of $16.2 million and inventories
of $18.4 million as of March 31, 2012. Outstanding days of sales, or DSO, were
50 days for the three months ended March 31, 2013 and 53 days for the three
months ended March 31, 2012. Annualized inventory turns were 3.1 times for the
three months ended March 31, 2013 and 3.3 times for the three months ended
March 31, 2012.

Conference Call Details

As previously announced, management will host a conference call to discuss
first quarter 2013 results and business highlights and outlook, which will be
simultaneously broadcast over the Internet and can be accessed through the
Harvard Bioscience, Inc. website. In addition, management may discuss, and
answer one or more questions concerning business and financial developments
and trends, including with respect to the Company's acquisition initiatives,
our efforts in the field of regenerative medicine and other business and
financial matters affecting the Company. Some of these discussions and
responses to questions may contain information that has not been previously
disclosed. The conference call will begin at 11:00 a.m. Boston time today, May
2, 2013. To listen to the conference call, log on to our website at
www.harvardbioscience.com and click on the Earnings Call icon. If you are
unable to listen to the live webcast, the call will be archived in the
investor relations section of our website. The live conference call is also
accessible by dialing toll-free 877-303-7611, or toll 970-315-0445, and
referencing the pass code of "46125296". A replay of this conference call will
be available from 2:00 p.m. on May 2, 2013 through May 11, 2013 and will be
accessible by dialing toll-free 855-859-2056, or toll 404-537-3406, and
referencing the pass code of "46125296". This earnings release, as well as any
material financial and other statistical information presented on the call
which is not included in this earnings release, is available on our website by
clicking on the Press Releases icon. If you are unable to listen to the live
conference call, please note that the call, this press release and any related
financial or statistical information will be archived on our website under the
Press Releases icon or Earnings Call icon, as appropriate.

Use of Non-GAAP Financial Information

In this press release, we have included non-GAAP financial information
including adjusted operating income, adjusted net income and adjusted earnings
per diluted share. We believe that this non-GAAP financial information
provides investors with an enhanced understanding of the underlying operations
of the business. For the periods presented, these non-GAAP financial measures
of income have excluded certain expenses and income primarily resulting from
purchase accounting or events that we do not believe are related to the
underlying operations of the business such as amortization of intangibles
related to acquisitions, costs related to acquisition initiatives,
restructuring expenses (including related inventory write-downs), and
stock-based compensation expense. They also exclude the tax impact of the
reconciling items and discrete items related to research and development
credits and stock option exercises. This non-GAAP financial information
approximates information used by our management to internally evaluate the
operating results of the Company. Tabular reconciliations of our non-GAAP
adjusted operating income, non-GAAP adjusted net income and non- GAAP adjusted
earnings per diluted share for the three months ended March 31, 2013 and 2012
and changes in total revenue compared to the same period of the prior year are
included as exhibits below in this press release.

The non-GAAP financial information provided in this press release should be
considered in addition to, not as a substitute for, the financial information
provided and presented in accordance with GAAP.

About Harvard Bioscience

Harvard Bioscience ("HBIO") is a global developer, manufacturer and marketer
of a broad range of specialized products, primarily apparatus and scientific
instruments, used to advance life science research and regenerative medicine.
Our products are sold to thousands of researchers in over 100 countries
primarily through its 850 page catalog (and various other specialty catalogs),
its website, through distributors, including GE Healthcare, Thermo Fisher
Scientific and VWR, and via our field sales organization. HBIO has sales and
manufacturing operations in the United States, the United Kingdom, Germany,
Sweden and Spain with additional facilities in France and Canada. For more
information, please visit www.harvardbioscience.com.

The Harvard Bioscience, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=6426

This press release contains forward-looking statements within the meaning of
the federal securities laws. You can identify these statements by our use of
such words as "will," "guidance," "objectives," "optimistic," "potential,"
"future," "expects," "plans," "estimates," "continue," "drive," "strategy,"
"potential," "potentially," "growth," "long-term," "projects," "projected,"
"intends," "believes," "goals," "sees," "seek," "develop" "possible" "new,"
"emerging," "opportunity," "pursue" and similar expressions that do not relate
to historical matters. Forward-looking statements in this press release or
that may be made during our conference call may include, but are not limited
to, statements or inferences about the Company's or management's beliefs or
expectations, the Company's anticipated future revenues and earnings, the
strength of the Company's market position and business model, the impact of
acquisitions, or potential acquisitions, the outlook for the life sciences
industry and the field of regenerative medicine, opportunities or potential
opportunities in the field of regenerative medicine, the Company's business
strategy, the positioning of the Company for growth, the market demand and
opportunity for the Company's current products, or products it is developing
or intends to develop, and the Company's plans, objectives and intentions that
are not historical facts.

These statements involve known and unknown risks, uncertainties and other
factors that may cause the Company's actual results, performance or
achievements to be materially different from any future results, performance
or achievements expressed or implied by the forward-looking statements.
Factors that may cause the Company's actual results to differ materially from
those in the forward-looking statements include the Company's failure to
identify potential acquisition candidates, successfully negotiate favorable
pricing and other terms with acquisition candidates to enable potential
acquisitions to close, successfully integrate acquired businesses or
technologies, complete consolidations of business functions, expand our
product offerings, introduce new products or commercialize new technologies,
including in the field of regenerative medicine,unanticipated costs relating
to acquisitions, unanticipated costs arising in connection with the
Company'sconsolidation of business functions and any restructuring
initiatives, decreased demand for the Company's products due to changes in our
customers' needs, our ability to obtain regulatory approvals, including FDA
approval, for our products, including any products in the field of
regenerative medicine, the current size or anticipated size of the
regenerative medicine market, the existence and size of opportunities in the
regenerative medicine market, our financial position, general economic outlook
or other circumstances, overall economic trends, the seasonal nature of
purchasing in Europe, economic, political and other risks associated with
international revenues and operations, the impact of the current economic and
financialcrisis, additional costs of complying with recent changes in
regulatory rules applicable to public companies, our ability to manage our
growth, our ability to retain key personnel, competition from our competitors,
technological changes resulting in our products becoming obsolete, future
changesto the operations or the activities of our subsidiaries due to
manufacturing consolidations, our ability to meet the financial covenants
contained in our credit facility, our ability to protect our intellectual
property and operate without infringing on others' intellectual property,
potential costs of any lawsuits to protect or enforce our intellectual
property, economic and political conditions generally and those affecting
pharmaceutical and biotechnology industries, research funding levels from
endowments at our university customers, impact of any impairment of our
goodwill or intangible assets, our ability to utilize deferred tax assets
after the release of our valuation allowances,our acquisition of Genomic
Solutions failing to qualify as a tax-free reorganization for federal tax
purposes, the amount of earn-out consideration that the Company receives in
connection with thedisposition ofthe Company's Capital Equipment Business
segment and factors that may impact the receipt of this consideration, such as
the revenues of the businesses disposed of, plus factors described under the
heading "Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 2012 or described in the Company's
other public filings. The Company's results may also be affected by factors of
which the Company is not currently aware. The Company may not update these
forward-looking statements, even though its situation may change in the
future, unless it has obligations under the federal securities laws to update
and disclose material developments related to previously disclosed
information.

For investor inquiries, please call (508) 893-8066. Press releases may be
found on our website, http://www.harvardbioscience.com.

Exhibit 1                                           
HARVARD BIOSCIENCE, INC.
Selected Consolidated Balance Sheet Information
(Unaudited, in thousands)
                                                   
                                                   
                                          As of
                                          March 31, December 31,
                                          2013      2012
                                                   
Assets                                              
                                                   
Cash and cash equivalents                  $23,749   $20,681
Trade receivables                          14,186    14,357
Inventories                               17,725    17,762
Property, plant and equipment              4,424     4,551
Goodwill and other intangibles            57,186    58,701
Other assets                               18,167    17,432
Total assets                               $135,437  $133,484
                                                   
Liabilities and Stockholders' Equity                
                                                   
Current liabilities                        $13,116   $9,901
Non-current liabilities                    17,939    19,370
Total liabilities                          31,055    29,271
Stockholders' equity                       104,382   104,213
Total liabilities and stockholders' equity $135,437  $133,484
                                                   

Exhibit 2                                                            
HARVARD BIOSCIENCE, INC.
Consolidated Statements of Operations
(In thousands, except per share data)
(unaudited)
                                                           Three Months Ended
                                                           March 31,
                                                           2013      2012
                                                                    
                                                                    
Revenues                                                    $26,086   $28,322
Cost of product revenues                                    13,820    14,922
Gross profit                                                12,266    13,400
                                                                    
Sales and marketing expenses                                4,752     4,768
General and administrative expenses                         5,070     4,861
Research and development expenses                           1,944     1,714
Restructuring charges                                       (21)      150
Amortization of intangible assets                           679       678
Total operating expenses                                    12,424    12,171
                                                                    
Operating (loss) income                                     (158)     1,229
                                                                    
Other (expense) income:                                              
Foreign exchange                                            34        (41)
Interest expense                                            (130)     (147)
Interest income                                             9         14
Other expense, net                                          (8)       (211)
Other (expense) income, net                                 (95)      (385)
                                                                    
(Loss) income from continuing operations before income      (253)     844
taxes
Income tax (benefit) expense                                (169)     315
(Loss) income from continuing operations                    (84)      529
Discontinued operations:                                             
Income from discontinued operations, net of tax             180       --
Total income from discontinued operations, net of tax       180       --
Net income                                                 $96       $529
                                                                    
Income per share:                                                    
Basic (loss) earnings per common share from continuing      $(0.00)   $0.02
operations
Discontinued operations                                     0.01      --
Basic earnings per common share                            $0.00    $0.02
                                                                    
Diluted (loss) earnings per common share from continuing    $(0.00)   $0.02
operations
Discontinued operations                                     0.01      --
Diluted earnings per common share                          $0.00    $0.02
                                                                    
Weighted average common shares:                                      
Basic                                                       29,778    28,710
Diluted                                                     29,778    29,673
                                                                    

Exhibit 3                                                
HARVARD BIOSCIENCE, INC.
Condensed Cash Flow Statements
(in thousands, unaudited)
                                                        
                                                Three Months Ended
                                                March 31,
                                                2013     2012
                                                        
Cash flows from operations:                              
Net income                                       $96      $529
Other adjustments to operating cash flows        1,097    1,678
Changes in assets and liabilities                (617)    (602)
Net cash provided by operating activities        576      1,605
                                                        
Investing activities:                                    
Net cash used in investing activities            (354)   (3,299)
                                                        
Financing activities:                                    
Net proceeds from issuance of debt               2,049    500
Other financing activities                       1,553    267
Net cash provided by financing activities        3,602    767
                                                        
Effect of exchange rate changes on cash          (756)    248
                                                        
Increase (decrease) in cash and cash equivalents $3,068   $(679)
                                                        

Exhibit 4                                                
HARVARD BIOSCIENCE, INC.
Reconciliation of US GAAP Operating (Loss) Income to Non-GAAP Adjusted
Operating Income from Continuing Operations
(in thousands)
(unaudited)
                                                        
                                          Three Months Ended
                                          March 31,
                                          2013           2012
                                                        
US GAAP operating (loss) income            $(158)       $1,229
                                                        
Adjustments:                                             
                                                        
Amortization of intangible assets          679            678
                                                        
Non-GAAP Restucturing charges              11             --
                                                        
Inventory amortization on acquisition      --           36
                                                        
GAAP Restructuring (credits) charges       (21)           150
                                                        
Stock-based compensation expense           649            697
                                                        
Non-GAAP adjusted operating income         $1,160         $2,790
                                                        

Exhibit 5                                                         
HARVARD BIOSCIENCE, INC.
Reconciliation of US GAAP Net (Loss) Income to Non-GAAP Adjusted Net Income
from Continuing Operations
(in thousands)
(unaudited)
                                                                 
                                Three Months Ended
                                March 31,
                                2013                    2012       
                                                                 
US GAAP net (loss) income from   $(84)                 $529       
continuing operations
                                                                 
Adjustments:                                                      
                                                                 
Amortization of intangible       679                     678        
assets
                                                                 
Inventory amortization on        --                    36         
acquisition
                                                                 
Direct acquisition costs         8                       205        
                                                                 
Non-GAAP Restructuring charges   11                      --       
                                                                 
GAAP Restructuring charges       (21)                   150        
                                                                 
Stock-based compensation expense 649                     697        
                                                                 
Income taxes                     (489)        (A)      (403)     (B)
                                                                 
Non-GAAP adjusted net income     $753                    $1,892     
from continuing operations
                                                                 
(A) Income taxes includes the tax effect of adjusting for the reconciling
items and discrete items related to research and development credits and stock
option exercises.
(B) Income taxes includes the tax effect of adjusting for the reconciling
items.

                                                                 
Exhibit 6                                                         
HARVARD BIOSCIENCE, INC.
Reconciliation of US GAAP Diluted (Loss) Earnings Per Common Share to Non-GAAP
Adjusted Diluted Earnings Per Common
Share from Continuing Operations
(unaudited)
                                                                 
                               Three Months Ended                   
                               March 31,                            
                               2013                   2012         
                                                                 
US GAAP diluted (loss)earnings
per common share from           $(0.00)                $0.02        
continuing operations
                                                                 
Adjustments:                                                      
                                                                 
Amortization of intangible      0.02                   0.02         
assets
                                                                 
Direct acquisition costs        --                   0.01         
                                                                 
Restructuring charges           --                   0.01         
                                                                 
Stock-based compensation        0.02                   0.02         
expense
                                                                 
Income taxes                   (0.01)      (A)      (0.02)      (B)
                                                                 
Non-GAAP adjusted diluted
earnings per common share from  $0.03                  $0.06        
continuing operations
                                                                 
(A) Income taxes includes the tax effect of adjusting for the reconciling
items and discrete items related to research and development credits and stock
option exercises.
(B) Income taxes includes the tax effect of adjusting for the reconciling
items.


Exhibit 7                                                      
HARVARD BIOSCIENCE, INC.
Reconciliation of Changes In Total Revenue Compared to the Same Period in the
Prior Years
(unaudited)
                                                              
                                     For                           For   Three
            Three Months Ended      the   Three Months Ended      the   Months
                                     Year                          Year  Ended
                                     Ended                         Ended
            March June  Sept. Dec.  Dec.  March June  Sept. Dec.  Dec.  March
             31,   30,   30,   31,   31,   31,   30,   30,   31,   31,   31,
            2011  2011  2011  2011  2011  2012  2012  2012  2012  2012  2013
                                                              
Organic      -2.1% -1.6% -6.3% -4.4% -3.8% 4.2%  2.2%  -1.2% -4.5% 0.1%  -8.5%
growth
                                                              
Acquisitions 1.3%  2.8%  4.2%  2.9%  2.9%  4.4%  4.9%  1.6%  1.6%  3.1%  0.9%
                                                              
Foreign
exchange     0.9%  3.6%  1.8%  -0.2% 1.5%  -1.0% -2.1% -1.4% 0.2%  -1.1% -0.3%
effect
                                                              
Total
revenue      0.1%  4.8%  -0.3% -1.7% 0.6%  7.6%  5.0%  -1.0% -2.7% 2.1%  -7.9%
growth
                                                              

CONTACT: David Green
         President
         dgreen@harvardbioscience.com
         Tel: 508 893 8999
         Fax: 508 429 8478
        
         Chane Graziano
         CEO
         cgraziano@harvardbioscience.com
        
         Tom McNaughton
         CFO
         tmcnaughton@harvardbioscience.com

Harvard Bioscience, Inc. Logo
 
Press spacebar to pause and continue. Press esc to stop.