Bruker Corporation (NASDAQ: BRKR) today reported financial results for the fourth quarter and full year ended December 31, 2007. The financial information included herein does not include the results of the Bruker BioSpin Group, which was acquired on February 26, 2008, but only the financial results of the standalone Bruker BioSciences Corporation, as it legally existed on December 31, 2007.
On February 26, 2008, Bruker BioSciences Corporation closed its acquisition of the Bruker BioSpin Group, and renamed itself Bruker Corporation. Under US GAAP, this transaction will be accounted for as an acquisition of businesses under common control, and as a result all one-time transaction costs are expensed in the period in which they are incurred, rather than being added to goodwill. In addition, after the closing of the transaction all historical consolidated balance sheets, statements of operations, statements of cash flows and notes to the consolidated financial statements in future filings with the Securities and Exchange Commission will be restated by combining the historical consolidated financial statements of Bruker BioSciences Corporation with those of the Bruker BioSpin Group. The Bruker BioSpin Group standalone financial results, as well as combined financial results for Bruker Corporation, are expected to be released in mid-March 2008. At that time, the newly combined Company will also provide an update on its financial goals for the year 2008.
Financial Results of Bruker BioSciences (excluding the Bruker BioSpin Group)
For the fourth quarter of 2007, revenue increased by 35% to $183.7 million, compared to revenue of $135.6 million in the fourth quarter of 2006. Excluding the effects of foreign currency translation, fourth quarter 2007 revenue increased organically by 26% year-over-year.
Net income in the fourth quarter of 2007 increased 44% to $14.0 million, or $0.13 per diluted share, compared to net income of $9.7 million, or $0.09 per diluted share, in the fourth quarter of 2006. Included in GAAP net income for the fourth quarter of 2007 were after-tax charges of $4.3 million, or $0.04 per diluted share, for expenses related to the acquisition of the Bruker BioSpin Group.
For the full year 2007, revenue increased by 26% to $547.6 million, compared to revenue of $435.8 million for the full year 2006. Excluding the effects of foreign currency translation, full year 2007 revenue increased by 19% year-over-year, including 17% organic growth and 2% growth from acquisitions.
Net income for the full year 2007 increased 70% to $31.5 million, or $0.30 per diluted share, compared to net income of $18.5 million, or $0.18 per diluted share, during the full year 2006. Included in GAAP net income for the full year 2007 were after-tax charges of $4.7 million, or $0.04 per diluted share, for expenses related to the acquisition of the Bruker BioSpin Group. For comparison, included in GAAP net income for the year 2006 were after-tax charges of $5.0 million, or $0.05 per diluted share, for expenses related to the acquisition of Bruker Optics.
During the fourth quarter of 2007, cash flow from operations was $36.4 million and free cash flow, defined as operating cash flow less capital expenditures, was $34.3 million. During the full year 2007, cash flow from operations was $26.3 million and free cash flow was $10.8 million. As of December 31, 2007, the Company had $72.9 million in cash and cash equivalents, and $38.1 million in outstanding debt.
Commenting on the Company's financial performance, Frank Laukien, President and CEO, said: "We had an outstanding fourth quarter, and we are very pleased that during 2007 we have achieved excellent top-line growth, with all three operating divisions delivering currency-adjusted double digit growth year-over-year. Even more importantly, our rapid growth, our continued operating margin expansion and our decreasing effective tax rate contributed to significantly improved bottom-line performance year-over-year, as well as to solid operating and free cash flow."
He continued: "Bruker BioSciences has made very good progress over the last three years. We will continue to strive for fast growth and further margin improvements in order to reach industry-standard profitability, and we will put a significant focus on balance sheet management and cash flow generation. We are optimistic that the renamed Bruker Corporation, which as of two days ago includes the Bruker BioSpin Group, is well positioned to serve our customers and markets with high-performance products and solutions. Despite the uncertainty in the macro-economic outlook, at this point the Company expects significant further financial improvements in the year 2008."
EARNINGS CONFERENCE CALL
Bruker Corporation will host an operator-assisted earnings conference call at 9 a.m. Eastern Time on Thursday, February 28, 2008. To listen to the webcast, investors can go to www.bruker-biosciences.com and click on the live web broadcast symbol. The webcast will be available through the Company web site for 30 days. Investors can also listen and participate on the telephone in the US and Canada by calling 888-339-2688, or 617-847-3007 outside the US and Canada. Investors should refer to the Bruker Corporation Quarterly Earnings Call. A telephone replay of the conference call will be available one hour after the conference call by dialing 888-286-8010 in the US and Canada, or 617-801-6888 outside the US and Canada, and then entering replay pass code 11927586.
ABOUT BRUKER CORPORATION
As of February 26, 2008, the renamed Bruker Corporation (NASDAQ: BRKR) has become the parent company of the entire Bruker group of companies. After the closing of the acquisition of the Bruker BioSpin Group, Bruker Corporation now operates in two segments, the life science and analytical (LSA) systems segment, and the international advanced superconductor (IAS) segment. For more information, please visit www.bruker-biosciences.com
CAUTIONARY STATEMENT
Any statements contained in this press release that do not describe historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein are based on current expectations, but are subject to a number of risks and uncertainties. The factors that could cause actual future results to differ materially from current expectations include, but are not limited to, risks and uncertainties relating to the integration of businesses we have acquired or may acquire in the future, changing technologies, product development and market acceptance of our products, the cost and pricing of our products, manufacturing, competition, dependence on collaborative partners and key suppliers, capital spending and government funding policies, changes in governmental regulations, intellectual property rights, litigation, and exposure to foreign currency fluctuations. These and other factors are identified and described in more detail in our filings with the SEC, including, without limitation, our annual report on Form 10-K for the year ended December 31, 2006, our most recent quarterly reports on Form 10-Q and our current reports on Form 8-K. We disclaim any intent or obligation to update these forward-looking statements other than as required by law.
Bruker Corporation (excluding the Bruker BioSpin Group)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, December 31,
--------------------- ---------------------
2007 2006 2007 2006
---------- ---------- ---------- ----------
Product revenue $ 164,910 $ 120,444 $ 482,153 $ 384,548
Service revenue 18,384 14,960 64,553 49,930
Other revenue 449 221 870 1,356
---------- ---------- ---------- ----------
Total revenue 183,743 135,625 547,576 435,834
Cost of product revenue 85,605 63,214 252,130 206,628
Cost of service revenue 12,492 9,239 42,308 29,872
---------- ---------- ---------- ----------
Total cost of revenue 98,097 72,453 294,438 236,500
---------- ---------- ---------- ----------
Gross profit margin 85,646 63,172 253,138 199,334
Operating Expenses:
Sales and marketing 31,074 25,212 105,983 84,007
General and administrative 10,392 8,663 34,058 28,982
Research and development 16,164 13,464 58,466 49,959
Acquisition related
charges 4,294 (105) 4,664 5,724
---------- ---------- ---------- ----------
Total operating expenses 61,924 47,234 203,171 168,672
---------- ---------- ---------- ----------
Operating income 23,722 15,938 49,967 30,662
Interest and other income
(expense), net (530) 236 (1,355) 3,758
---------- ---------- ---------- ----------
Income before income tax
provision and minority
interest in consolidated
subsidiaries 23,192 16,174 48,612 34,420
Income tax provision 9,129 6,533 16,784 15,931
---------- ---------- ---------- ----------
Income before minority
interest in consolidated
subsidiaries 14,063 9,641 31,828 18,489
Minority interest in
consolidated subsidiaries 44 (67) 299 8
---------- ---------- ---------- ----------
Net income $ 14,019 $ 9,708 $ 31,529 $ 18,481
========== ========== ========== ==========
Net income per share:
Basic $ 0.13 $ 0.10 $ 0.30 $ 0.18
========== ========== ========== ==========
Diluted $ 0.13 $ 0.09 $ 0.30 $ 0.18
========== ========== ========== ==========
Weighted average shares
outstanding:
Basic 104,508 101,501 103,702 101,512
========== ========== ========== ==========
Diluted 107,180 103,370 106,769 102,561
========== ========== ========== ==========
Bruker Corporation (excluding the Bruker BioSpin Group)
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
December December
31, 31,
2007 2006
-------- --------
ASSETS
Current assets:
Cash and short-term investments $ 72,876 $ 52,147
Accounts receivable, net 114,938 79,604
Due from affiliated companies 7,203 9,028
Inventories 171,332 134,504
Other current assets 29,281 19,461
-------- --------
Total current assets 395,630 294,744
Property and equipment, net 103,100 90,349
Intangible and other assets 54,483 48,094
-------- --------
Total assets $553,213 $433,187
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term borrowings $ 31,716 $ 21,857
Accounts payable 32,584 23,102
Due to affiliated companies 8,326 5,901
Other current liabilities 180,327 144,268
-------- --------
Total current liabilities 252,953 195,128
Long-term debt 6,394 22,863
Other long-term liabilities 34,702 23,491
Minority interest in subsidiaries 505 239
Total shareholders' equity 258,659 191,466
-------- --------
Total liabilities and shareholders' equity $553,213 $433,187
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Contacts:
Michael Willett, +1 978-663-3660, ext. 1411
Investor
Relations Officer
ir@bruker-biosciences.com
