Alere Inc. Announces First Quarter 2013 Results

               Alere Inc. Announces First Quarter 2013 Results

PR Newswire

WALTHAM, Mass., May 9, 2013

WALTHAM, Mass., May 9, 2013 /PRNewswire/ --Alere Inc. (NYSE: ALR), a global
leader in enabling individuals to take charge of their health at home through
the merger of rapid diagnostics and health information solutions, today
announced its financial results for the quarter ended March 31, 2013.

Ron Zwanziger, Chairman, Chief Executive Officer and President of Alere said,
"I'm pleased to report another quarter of progress across the organization.
With our company formation substantially complete, and the areas of pressure
with Triage and Health Information Solutions showing signs of stability, we
were able to take key steps to drive improved operating expense leverage in
the first quarter."

Zwanziger added, "Broad changes to healthcare systems in most major markets
are driving increasing opportunities for Alere's integrated offering.As we
continue to combine new diagnostic platforms and services into an integrated,
technology-based solution focused on the most expensive chronic conditions, we
expect to benefit from these persistent and predictable global trends. Our
unique position to capitalize on the evolution of global healthcare, combined
with a sustained focus on organic revenue growth, operating expense leverage
and debt reduction over the next several years, should continue to engender
increasing shareholder confidence in our company and our prospects for future
success."

Financial results for the first quarter of 2013:

  oNet revenue of $739.2 million for the first quarter of 2013, compared to
    $671.1 million for the first quarter of 2012. Non-GAAP adjusted net
    revenue, which includes approximately $0.6 million in estimated revenue
    related to acquired software license contracts not recognized for GAAP
    purposes for the first quarter of 2013 due to business combination
    accounting rules, was $739.9 million for the first quarter of 2013,
    compared to $672.4 million for the first quarter of 2012, which included
    $1.3 million in estimated revenue related to acquired software license
    contracts not recognized for GAAP purposes.
  oNet income of $7.2 million attributable to common stockholders of Alere
    Inc., and respective net income per diluted common share of $0.09, for the
    first quarter of 2013, compared to net loss of $4.1 million attributable
    to common stockholders of Alere Inc., and respective net loss per diluted
    common share of $0.05, for the first quarter of 2012.
  oNon-GAAP adjusted net income per diluted common share of $0.53 for the
    first quarter of 2013, compared to non-GAAP adjusted net income per
    diluted common share of $0.77 for the first quarter of 2012.
  oNet product and services revenue from our Professional Diagnostics segment
    was $578.6 million in the first quarter of 2013, compared to net product
    and services revenue of $515.4 million in the first quarter of 2012.
    Non-GAAP adjusted net product and services revenue from our Professional
    Diagnostics segment, which includes approximately $0.6 million in
    estimated revenue related to acquired software license contracts not
    recognized for GAAP purposes for the first quarter of 2013 due to business
    combination accounting rules, was $579.3 million in the first quarter of
    2013, compared to non-GAAP adjusted net product and services revenue of
    $516.7 million in the first quarter of 2012, which included $1.3 million
    in estimated revenue related to acquired software license contracts not
    recognized for GAAP purposes. Recent professional diagnostics
    acquisitions contributed $62.0 million of incremental net revenue compared
    to the first quarter of 2012.
  oNorth American influenza sales increased to $34.3 million for the first
    quarter of 2013, from $6.6 million for the first quarter of 2012.
  oExcluding the impact of the change in North American influenza revenues
    and the impact on revenues from the reduction in our U.S. meter-based
    Triage product sales, currency adjusted organic growth in our Professional
    Diagnostics segment was 1.1%.
  oNet product and services revenue from our Health Information Solutions
    segment was $134.2 million in the first quarter of 2013, compared to
    $130.8 million in the first quarter of 2012 and $131.0 million in the
    fourth quarter of 2012. The increase in revenue from the first quarter of
    2012 was related primarily to increased revenues from our home coagulation
    monitoring programs.
  oOther income for the first quarter of 2012 includes $13.5 million of a
    final royalty termination payment received from Quidel during the quarter,
    offset by $2.3 million of other charges. Together, and net of tax, these
    other income items added approximately $0.12 to our non-GAAP adjusted net
    income per diluted common share for the quarter.

The Company's GAAP results for the first quarter of 2013 exclude $0.6 million
of revenue associated with acquired software license contracts that are not
recognized due to business combination accounting rules and include
amortization of $76.0 million, $3.9 million of restructuring charges, $4.1
million of stock-based compensation expense, $0.9 million of
acquisition-related costs recorded in accordance with ASC 805, Business
Combinations, $11.0 million of expense recorded for fair value adjustments to
acquisition-related contingent consideration, $1.0 million of interest expense
recorded in connection with fees paid for certain debt modifications, $0.7
million in compensation charges associated with acquisition-related contingent
consideration obligations, a $0.5 million charge associated with the write-up
to fair market value of inventory acquired in connection with the acquisition
of Epocal Inc. and $0.2 million of expense associated with the extinguishment
of debt. The Company's GAAP results for the first quarter of 2012 exclude
$1.3 million of revenue associated with acquired software license contracts
that are not recognized due to business combination accounting rules and
include amortization of $78.1 million, $5.6 million of restructuring charges,
$3.9 million of stock-based compensation expense, $1.5 million of
acquisition-related costs recorded in accordance with ASC 805, Business
Combinations, $5.0 million of income recorded for fair value adjustments to
acquisition-related contingent consideration obligations, $1.3 million of
interest expense associated with fees paid for modification of certain debt
agreements and a $4.7 million charge associated with the write-up to fair
market value of inventory acquired in connection with the acquisition of
Axis-Shield plc. These amounts, net of tax, have been excluded from the
non-GAAP adjusted net income per diluted common share attributable to Alere
Inc. for the respective quarters.

Detailed reconciliations of the Company's non-GAAP adjusted operating income
and non-GAAP adjusted net income available to common shareholders to operating
income and net loss available to common shareholders under GAAP, as well as a
discussion regarding these non-GAAP financial measures, is included in the
schedules to this press release.

The Company will host a conference call beginning at 8:30 a.m. (Eastern Time)
today, May 9, 2013, to discuss these results, as well as other corporate
matters. During the conference call, the Company may answer questions
concerning business and financial developments and trends and other business
and financial matters. The Company's responses to these questions, as well as
other mattersdiscussed during the conference call, may contain or constitute
information that has not been previously disclosed.

The conference call may be accessed by dialing (877) 270-2148 (domestic) or
(412) 902-6510 (international) and asking for Alere Inc. A webcast of the
call can also be accessed via the Alere website at www.alere.com/investors, or
directly through the following link: http://www.videonewswire.com/event.

A replay of the call will be available approximately one hour after the
conclusion of the call and will remain available for a period of seven days
following the call. The replay may be accessed by dialing (877) 344-7529
(domestic) or (412) 317-0088 (international) and entering replay code
10028513. The replay will also be available via online webcast at
http://www.videonewswire.com/event or via the Alere website at
www.alere.com/investors for a period of 60 days following the call.

Additionally, reconciliations to non-GAAP financial measures not included in
this press release that may be discussed during the call will also be
available at the Alere website (http://www.alere.com/investors) under the
Earnings Calls and Releases section shortly before the conference call begins
and will continue to be available on this website.

For more information about Alere, please visit our web site at 
http://www.alere.com.

By developing new capabilities in near-patient diagnosis, monitoring and
health information solutions, Alere enables individuals to take charge of
improving their health and quality of life at home. Alere's global leading
products and services, as well as its new product development efforts, focus
on cardiology, infectious disease, toxicology and diabetes. Alere is
headquartered in Waltham, Massachusetts.

Alere Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
                                          Three Months Ended March 31,
                                          2013               2012
Net product sales and services            $           $       
revenue                                   735,185            668,221
License and royalty revenue               4,064              2,908
 Net revenue                              739,249            671,129
Cost of net revenue                       374,992            318,058
  Gross profit                       364,257            353,071
  Gross margin                       49%                53%
Operating expenses:
 Research and development                 41,454             39,000
 Selling, general and                     292,314            279,013
 administrative
  Total operating expenses              333,768            318,013
  Operating income                   30,489             35,058
Interest and other income                 (57,869)           (38,896)
(expense), net
 Loss before benefit for income          (27,380)           (3,838)
 taxes
Benefit for income taxes                  (36,871)           (1,455)
 Income (loss) before equity earnings of 9,491              (2,383)
 unconsolidated entities, net of tax
Equity earnings of unconsolidated         2,934              3,412
entities, net of tax
Net income                                12,425             1,029
 Less: Net loss attributable to           (25)               (185)
 non-controlling interests
Net income attributable to Alere          12,450             1,214
Inc. and Subsidiaries
 Preferred stock dividends                (5,250)            (5,309)
Net income (loss) available to            $          $        
common stockholders                        7,200            (4,095)
 Basic net income (loss) per              $          $        
 common share                               0.09            (0.05)
 Diluted net income (loss) per            $          $        
 common share                               0.09            (0.05)
Weighted-average shares - basic           81,199             80,240
Weighted-average shares - diluted         81,300             80,240

Alere Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands)
                                   March 31,              December 31,
                                   2013                   2012
ASSETS
CURRENT ASSETS:
Cash and cash equivalents          $      327,233   $      328,346
Restricted cash                    11,649                 3,076
Marketable securities              884                    904
Accounts receivable, net           540,093                524,332
Inventories, net                   336,442                337,121
Prepaid expenses and other current 250,876                212,958
assets
Total current assets               1,467,177              1,406,737
PROPERTY, PLANT AND EQUIPMENT, NET 529,164                534,469
GOODWILL AND OTHER INTANGIBLE      5,049,886              4,919,081
ASSETS, NET
DEFERRED FINANCING COSTS AND OTHER 202,248                207,641
ASSETS, NET
Total assets                       $    7,248,475     $     7,067,928
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt  $       58,356  $       
and capital lease obligations                             66,916
Other current liabilities          636,931                581,893
Total current liabilities          695,287                648,809
LONG-TERM LIABILITIES:
Long-term debt and capital lease
obligations, net of current        3,800,457              3,641,592
portion
Deferred tax liabilities           415,452                428,188
Other long-term liabilities        212,376                166,635
Total long-term liabilities        4,428,285              4,236,415
TOTAL EQUITY                       2,124,903              2,182,704
Total liabilities and equity       $    7,248,475     $     7,067,928



Alere Inc. and Subsidiaries
Reconciliation to Non-GAAP Adjusted Operating Results
(in thousands, except per share amounts)
                                          Three Months Ended March 31,
                                          2013               2012
Reconciliation to Non-GAAP Adjusted
Operating Income ^(1)
Operating income                          $          $        
                                          30,489            35,058
Adjustment related to acquired software   643                1,286
license contracts
Amortization of acquisition-related       75,867             77,929
intangible assets
Restructuring charges                    3,892              5,528
Stock-based compensation expense          4,123              3,874
Compensation charges associated with
acquisition-related contingent            690                -
consideration obligations
Acquisition-related costs                 896                1,461
Fair value adjustments to
acquisition-related contingent            11,018             5,044
consideration
Non-cash charge associated with acquired  461                4,681
inventory
Non-GAAP adjusted operating income        $           $       
                                          128,079           134,861
                                          Three Months Ended March 31,
                                          2013               2012
Reconciliation to Non-GAAP Adjusted Net
Income^(1)
Net income (loss) available to common     $          $        
stockholders                               7,200           (4,095)
Adjustment related to acquired software   643                1,286
license contracts
Amortization of acquisition-related       75,989             78,122
intangible assets
Restructuring charges                    3,947              5,588
Stock-based compensation expense          4,123              3,874
Compensation charges associated with
acquisition-related contingent            690                -
consideration obligations
Acquisition-related costs                 896                1,461
Fair value adjustments to
acquisition-related contingent            11,018             5,044
consideration
Non-cash charge associated with acquired  461                4,681
inventory
Interest expense recorded in connection
with fees paid for certain debt

modifications and the termination of our  952                1,320
senior secured credit facility and

related interest rate swap agreement
Expense associated with extinguishment of 163                -
debt
Income tax effects on items above         (62,055)           (30,779)
Non-GAAP adjusted net income available to $          $        
common stockholders                       44,027            66,502
Net income (loss) per diluted common      $          $        
share                                        0.09          (0.05)
Non-GAAP adjusted net income per diluted  $          $        
common share                                 0.53           0.77
Weighted-average shares - diluted         81,300             80,240
Non-GAAP adjusted weighted average shares 94,977             94,206
- diluted

^(1)In calculating "non-GAAP adjusted operating income" and "non-GAAP adjusted
net income", the Company excludes (i) certain non-cash charges, including
amortization expense and stock-based compensation expense, (ii) non-recurring
charges and income, and (iii) certain other charges and income that have a
significant positive or negative impact on results yet do not occur on a
consistent or regular basis in its business. In determining whether a
particular item meets one of these criteria, management considers facts and
circumstances that it believes are relevant. Management believes that
excluding such charges and income from operating income and net income or loss
allows investors and management to evaluate and compare the Company's
operating results from continuing operations from period to period in a
meaningful and consistent manner. Due to the frequency of their occurrence in
its business, the Company does not adjust operating income or net income or
loss for the costs associated with litigation, including payments made or
received through settlements. It should be noted that "non-GAAP adjusted
operating income" and "non-GAAP adjusted net income" are not standard
financial measurements under accounting principles generally accepted in the
United States of America ("GAAP") and should not be considered as an
alternative to operating income and net income or loss or cash flow from
operating activities, as a measure of liquidity or as an indicator of
operating performance or any measure of performance derived in accordance with
GAAP. In addition, all companies do not calculate non-GAAP financial measures
in the same manner and, accordingly, "non-GAAP adjusted operating income" and
"non-GAAP adjusted net income" presented in this press release may not be
comparable to similar measures used by other companies.





Alere Inc. and Subsidiaries
Selected Consolidated Revenues by Business Area ^(1)
(in thousands)
Professional Diagnostics Segment                                   % Change
                                      Q1 2013           Q1 2012    Q1 13 v. Q1
                                                                   12
Cardiology                            $    114,933   $       -17%
                                                        138,826
Infectious disease                    189,844           151,016    26%
Toxicology                            149,049           121,740    22%
Diabetes                              50,083            28,161     78%
Other ^(1)                            74,719            75,706     -1%
 Professional diagnostics net product 578,628           515,449    12%
 salesand services revenue ^(1)
License and royalty revenue           3,864             2,908      33%
 Professional diagnostics net revenue $    582,492   $       12%
                                                        518,357
Health Information Solutions Segment                               % Change
                                      Q1 2013           Q1 2012    Q1 13 v. Q1
                                                                   12
Disease and case management           $             $      1%
                                      54,126           53,380
Wellness                              26,300            27,026     -3%
Women's & children's health           29,080            29,771     -2%
Patient self-testing services         24,701            20,607     20%
 Health information solutions net     $    134,207  $       3%
 revenue                                                130,784

^(1)Revenues are presented in accordance with Generally Accepted Accounting
Principles and exclude an adjustment of $0.6 million and $1.3 million in
revenue related to acquired software license contracts which were not
recognized during the three months ended March 31, 2013 and 2012,
respectively, due to business combination accounting rules.





SOURCE Alere Inc.

Website: http://www.alere.com
Contact: Doug Guarino, Director of Corporate Relations; or Jon Russell, Vice
President of Finance, 781-647-3900