News out today. I just can't believe NEOG keeps falling and now at 8+. I would think NEOG will do good in bull and bear markets, any other thoughts. While there is a lot of technical developments like irradiation and ozone, I would think that testing will continue to be essential. Here is the news:
Friday June 5, 11:32 am Eastern Time
Company Press Release
SOURCE: Neogen Corporation
Neogen Announces Preliminary Year-End Results
LANSING, Mich., June 5 /PRNewswire/ -- Neogen Corporation (Nasdaq: NEOG - news) announced today preliminary
results for the fiscal year that ended on May 31, 1998. The Company expects to report approximately $18,500,000 in sales
for the year with earnings between $.34 and $.36 per share. Profits for fiscal 1998 will be a 20% to 25% increase over last
year, but are below analysts' expectations which ranged between $.40 and $.44 per share. Neogen recorded sales of
$15,259,000 and earnings of $.32 per share for the fiscal year that ended May 31, 1997.
Sales of products dedicated to food safety are expected to exceed $7,850,000 for the year. Sales of test kits to the meat and
poultry, and seafood industries, including kits for the detection of microorganisms such as E. coli O157:H7 and Salmonella,
increased 104% in fiscal 1998. With ongoing implementation of new governmental regulations required in the meat and poultry,
and seafood industries, management believes that sales of test kits to these markets offer an excellent opportunity for future
sales growth.
Sales to the professional equine market are expected to be $5,500,000 in 1998 compared to $2,484,000 in 1997,
representing an increase of 120%. Two acquisitions during 1998 contributed approximately $2,500,000 in professional equine
sales growth. Veterinary instrument products accounted for $3,500,000 in sales compared to $3,353,000 last year, and
phamacologic and clinical diagnostic sales were approximately $1,600,000 compared to $1,694,000 in the prior year.
Lon Bohannon, Neogen's chief financial officer, stated that ''earnings per share will be below analysts' expectations for several
reasons, including higher operating expenses for marketing, research and administration. We made an investment in our future
by increasing staffing levels which has a negative effect on earnings for the short term.'' Bohannon also pointed out that ''fiscal
1998's earnings were impacted by weather conditions that resulted in a clean grain crop, and therefore less sales of kits to
detect mycotoxins such as vomitoxin.''
Administrative costs have also risen due to substantially higher legal expense in fiscal year 1998. Neogen estimates that its legal
expenses will be $200,000 higher in fiscal 1998 than the prior year. Neogen is the plaintiff in a lawsuit filed in federal court
against a competitor claiming corporate defamation, tortious interference of a business relationship and patent misuse. Neogen
is also the plaintiff in a lawsuit filed in federal court against a former vendor claiming breach of contract, fraudulent
misrepresentations and trademark infringement among other claims.
James Herbert, Neogen president and CEO, stated ''Neogen is vigorously pursuing this litigation because management believes
strongly that it is in the best interest of the company and our shareholders to do so. Though the outcomes are unpredictable, we
believe our legal positions in these lawsuits are strong. It is also difficult to predict how much longer we may incur expenses
while the litigation is being resolved.''
Except for historical information contained herein, the statements made in this release constitute forward-looking statements that
involve certain risks and uncertainties. Certain factors may cause actual results to differ materially from those contained in the
forward-looking statements, including those risks detailed from time to time in the Company's reports on file at the Securities
and Exchange Commission.
Neogen Corporation is a Lansing, Michigan based company that develops and markets products and services dedicated to
food and animal safety. The Company's diagnostic products are used by food and animal producers to test for foodborne
bacteria, natural toxins, drug residues, plant diseases and quality assurance.
SOURCE: Neogen Corporation
Long NEOG,
Terry |
