>>QIAGEN Reports Strong Fourth Quarter and Fiscal Year-End 2006 Results
Monday February 12, 4:00 pm ET
17% Constant Currency and 11% Organic Revenue Growth in 2006
22% Growth in Adjusted EPS in 2006
Fourth Quarter 2006 Adjusted EPS Exceeds Guidance
VENLO, The Netherlands, February 12 /PRNewswire-FirstCall/ -- QIAGEN N.V. (Nasdaq: QGEN; Frankfurt, Prime Standard: QIA) today announced the results of operations for the fourth quarter and the fiscal year ended December 31, 2006.
The reported net sales and adjusted earnings per share for the fourth
quarter and fiscal 2006 met or exceeded the guidance provided by the company
on May 9, 2006.
QIAGEN's Fiscal 2006:
Guidance
May 9, 2006(1) Reported
Net sales (US$m) 453 - 462 466 (2)
Operating margin, adj.(3) 26% - 28% 26%
EPS, adj. (US$)3 0.52 - 0.56 0.56
(1) Based on January 31, 2006 foreign currency exchange rates
(2) US$459 million using January 31, 2006 foreign currency exchange rates
(3) excluding acquisition, integration and restructuring related charges
as well as amortization of acquired IP and equity-based compensation
(SFAS 123R)
The Company reported that consolidated net sales for its fourth quarter 2006 increased 21% to $125.9 million from $104.3 million for the same quarter in 2005. Reported operating income for the quarter increased 4% to $26.9 million from $26.0 million in the same quarter of 2005, and net income for the quarter increased 15% to $19.4 million from $16.9 million in the same quarter of 2005. Diluted earnings per share for the fourth quarter increased 18% to $0.13 in 2006 (based on 154.8 million weighted average shares and share equivalents outstanding) from $0.11 in 2005 (based on 149.7 million weighted average shares and share equivalents outstanding).
The Company has regularly reported adjusted results to give additional insight into the Company's financial performance. Adjusted results should be considered in addition to the reported results prepared in accordance with generally accepted accounting principles, but should not be considered a substitute. Costs and charges excluded from adjusted results are acquisition, integration, restructuring and related costs, acquisition-related amortization, and beginning in the first quarter of 2006, compensation cost due to equity based compensation in accordance with the adoption of revised Statement of Financial Accounting Standards No. 123 (SFAS 123R).
QIAGEN's Adjustments to Operating Income, Net Income and EPS:
In US$ millions unless indicated Q4 2006 Q4 2005
Operating income, reported 26.89 25.97
Acquisition and integration 3.28
related charges 3.57
Relocation and restructuring 0.67
charges -
SFAS 123R Impact 0.14 -
Amortization of acquired IP 2.46 1.21
Operating income, adjusted 33.44 30.75
Net income, reported 19.45 16.86
Acquisition and integration 2.84
related charges 2.24
Relocation and restructuring 0.44
charges -
SFAS 123R Impact 0.09 -
Amortization of acquired IP 1.60 0.77
Net income, adjusted 24.42 19.87
Weighted average number of 154,783,000 149,736,000
diluted common shares
EPS, reported in US$ 0.13 0.11
EPS, adjusted in US$ 0.16 0.13
The impact of these costs and charges during the fourth quarter 2006 totaled $6.6 million ($5.0 million net of tax). Included in operating income in the fourth quarter 2006 are amortization on acquisition-related intangibles of $2.5 million ($1.6 million net of tax), acquisition, integration and related costs of $3.3 million ($2.8 million net of tax), relocation and restructuring costs of $667,000 ($438,000 net of tax), and SFAS 123R compensation cost of $138,000 ($91,000 net of tax). Included in operating income in the fourth quarter 2005 are amortization on acquisition-related intangibles of $1.2 million ($772,000 net of tax) and acquisition, integration and related costs of $3.6 million ($2.2 million net of tax). Excluding these charges, adjusted fourth quarter operating income increased 9% to $33.4 million in 2006 from $30.7 million in 2005, and fourth quarter adjusted net income increased 23% to $24.4 million in 2006 from $19.9 million in 2005. Adjusted diluted earnings per share in the fourth quarter 2006 increased 23% to $0.16 per share from $0.13 per share in the fourth quarter 2005.
For the year ended December 31, 2006, net sales increased 17% to $465.8 million compared to $398.4 million in 2005. Operating income as reported for fiscal 2006 increased 6% to $100.6 million from $94.8 million for 2005, and net income increased 13% to $70.5 million from $62.2 million in 2005, and diluted earnings per share increased 12% to $0.46 from $0.41.
Included in operating income in fiscal 2006 is amortization on acquisition-related intangibles of $8.2 million ($5.3 million net of tax), acquisition, integration and related costs of $10.3 million ($8.3 million net of tax), relocation and restructuring costs of $1.5 million ($1.0 million net of tax), and SFAS 123R equity based compensation cost of $325,000 ($213,000 net of tax). Included in operating income in fiscal 2005 is amortization on acquisition-related intangibles of $3.7 million ($2.4 million net of tax) and acquisition, integration and related costs of $6.9 million ($4.6 million net of tax). Excluding these charges, adjusted operating income for the year ended December 31, 2006 increased 15% to $120.9 million from $105.4 million in 2005, and adjusted net income increased 23% to $85.3 million in 2006 from $69.2 million in 2005. Adjusted diluted earnings per share for the year ended December 31, 2006 increased 22% to $0.56 per share, from $0.46 per share in 2005.
Guidance for 2007:
QIAGEN expects to record revenues between $518 and $535 million in 2007 and adjusted diluted earnings per share between $0.60 and $0.63. The guidance for adjusted EPS includes a diluting effect on EPS of approximately $0.03 related to the acquisition of Genaco in 2006. Excluding these expenses and costs related to Genaco, which are primarily expenses for clinical trials and regulatory activities for certain multiplexed PCR test panels, guidance for adjusted EPS would have been $0.63 - 0.66. The Company will provide detailed guidance in the Company's conference call on February 13, 2007.
"2006 was a very successful year for QIAGEN. We executed on our strategy and significantly increased our technology and market leadership in our markets", said Peer Schatz, QIAGEN's Chief Executive Officer. "The launch of 67 new products in 2006 including innovative sample and assay technologies for research in the areas of epigenetics, gene expression, micro RNA, proteomics, RNAi, applied testing and molecular diagnostics contributed a record 4% to 2006 net sales and was another strong demonstration of QIAGEN's innovation power. With a full pipeline of new products and a strong strategic position we built a solid basis for our success in 2007 and beyond. "
"We expect a number of exciting new market introductions in 2007. These include a further expansion of our sample and assay technology portfolio for research in applied testing and molecular diagnostics. We are planning a significant investment in clinical trials for a number of molecular diagnostic products with the goal of adding more regulated products to our portfolio." Mr. Schatz added. "Our pipeline of automated solutions for our sample and assay technologies is strong as well. The first launch in this portfolio, our recently introduced QIAcube, is already generating a lot of excitement and has the potential to bring significant value to our customers as they can now process on the QIAcube the same QIAGEN consumables that are such strong standards in their workflows."
"Our acquisition strategy remained focused, consistent and value creating. With the acquisitions of Gentra Systems, Inc. in the area of sample technologies and Genaco Biomedical Products, Inc. in the area of assay technologies, we enhanced our technology leadership even further. Genaco's PCR-based multiplexing technologies provide us with vast opportunities for multiplexed (multiple target) assays for research in clinical development, applied testing and molecular diagnostics and further strengthen our position as a leading company in these markets. QIAGEN today is perceived as the market, technology and innovation leader in sample and assay technologies and we believe to be well positioned to take advantage of the exciting growth opportunities in our target markets including research in life sciences, applied testing and molecular diagnostics."
"QIAGEN experienced an exciting fourth quarter 2006 and fiscal year 2006. Reported revenues and adjusted earnings per share met or exceeded our guidance and operating income was in-line with our expectations," said Roland Sackers, QIAGEN's Chief Financial Officer. "Revenue growth for the full year was 17% and was fueled by a strong organic growth of 11% and a positive contribution of 6% from acquisitions. Our consumable portfolio contributed 17% growth.
"QIAGEN also experienced a very good year in terms of sales of instrumentation products especially through our dedicated sales channels in clinical research and molecular diagnostics markets," Mr. Sackers continued. "QIAGEN's instrumentation business showed a very strong growth rate at constant exchange rates of 18% in 2006 (47% in the fourth quarter 2006) and the product pipeline is strong for 2007. Net sales for the fiscal year 2006 recorded in North America represented approximately 44% of our overall business and recorded a growth rate of 12% whereby European sales, which represent approximately 44% of our revenues showed a growth rate of approximately 17% at constant exchange rates. Net sales in Asia showed a very strong growth rate of 45% at constant exchange rates in fiscal 2006 driven by a strong demand, primarily in China."
QIAGEN's Fiscal Year 2006 at Constant Currencies:
As percentage 2006 2006 2005 Growth Rates
of net sales, Constant Constant
unless indicated Reported Currency Reported Reported Currency
Consumables 89% 89% 88% 17% 17%
Instruments 10% 10% 10% 19% 18%
Others 1% 1% 2% -16% -16%
Total revenues 100% 100% 100% 17% 17%
Operating income margin 22% 22% 24% 6% 8%
Operating income
margin, adj.(1) 26% 26% 26% 15% 16%
Net income margin 15% 16% 16% 13% 16%
Net income margin,
adj.(1) 18% 19% 17% 23% 25%
EPS in US$ per share 0.46 0.47 0.41 12% 15%
EPS in US$ per share,
adj.(1) 0.56 0.57 0.46 22% 24%
(1) excluding acquisition, integration and restructuring related charges
as well as amortization of acquired IP and equity-based compensation
(SFAS 123R)
QIAGEN - Sample and Assay Technologies Highlights:
- QIAGEN developed and launched 67 new products during 2006 including innovative sample and assay technologies for research in the areas of epigenetics, gene expression, micro RNA, proteomics, RNAi and molecular diagnostics.
- QIAGEN in early 2007, launched the QIAcube, a revolutionary sample processing platform incorporating novel and proprietary technologies which allow users in over 40,000 laboratories in research in life sciences, applied testing and molecular diagnostics to fully automate the processing of almost all QIAGEN consumable products. The QIAcube received the distinguished New Product Award (NPA) Designation of the Association for Laboratory Automation (ALA) in February, 2007.
- QIAGEN acquired Gentra Systems, Inc., a leading provider of large volume nucleic acid sample preparation products with a strong brand value in well-defined market niches, including biobanking and DNA archiving.
- QIAGEN acquired Genaco Biomedical Products, Inc., an early stage company applying a proprietary PCR-based multiplexing technology, TEM-PCR. The Genaco solutions leverage and employ QIAGEN sample and assay technologies and open the door for PCR-based, multiplexed testing in clinical research, applied testing and molecular diagnostics.
Detailed information on the Company's business and financial performance as well as guidance on the Company's outlook for 2007 will be presented in the Company's conference call on February 13, 2007 at 9:30am EST. The corresponding presentation slides will be available for download on the Company's website at www.qiagen.com/goto/130207. A webcast of the conference call will be available on the same website at www.qiagen.com/goto/130207. <<
snip
Pretty much in line on revenue, EPS, guidance (in line wrt analysts consensus, slightly above the company's prior guidance). All except revenue are a bit below what Yahoo! gives as analyst consensus, but it's hard to know if that number is GAAP or not; I believe not.
Looks solid, though. Steadily growing into the high multiple it was sporting a few years back. No position of my own, but my Mom holds and will continue to do so.
Cheers, Tuck |
