Bruker Corporation (NASDAQ: BRKR) today reported financial
results for the second quarter ended June 30, 2009.
Second Quarter 2009 Highlights
- Revenue $252.5 million
- GAAP Net Income $12.9
million
- GAAP EPS $0.08 per diluted
share
- Free cash flow $32.8
million
- After acquisition of ACCEL RI
business on April 1, 2009, Bruker established new Energy &
Supercon Technologies segment
- Bruker’s Scientific Instruments
segment launched numerous innovative products with compelling
performance and capabilities: Avance III 1,000 MHz NMR,
ultrafleXtreme TOF/TOF, amaZon ion trap, solariX FTMS and 263 GHz
EPR
Financial Results
In the second quarter of 2009, revenue was $252.5 million, a
decrease of 18.9% compared to revenue of $311.5 million in the
second quarter of 2008. Excluding the effect of foreign currency
translation, second quarter 2009 revenue decreased 11.1%
year-over-year. Sequentially, revenue increased 9.5% over the first
quarter of 2009. GAAP net income for the second quarter of 2009 was
$12.9 million, or $0.08 per diluted share, compared to GAAP net
income of $21.7 million, or $0.13 per diluted share, in the second
quarter of 2008. Included in GAAP EPS in the second quarter of 2009
was non-cash stock-based compensation expense of ($0.01) per
diluted share.
For the six months ended June 30, 2009, revenue was $483.0
million, a decrease of 12.2%, compared to revenue of $549.8 million
in the first half of 2008. Excluding the effect of foreign currency
translation, revenue for the six months ended June 30, 2009
decreased by 4.4% year-over-year. GAAP net income for the six
months ended June 30, 2009 was $21.3 million, or $0.13 per diluted
share, compared to GAAP net income of $20.9 million, or $0.13 per
diluted share, during the six months ended June 30, 2008. Included
in GAAP EPS for the six months ended June 30, 2009 was non-cash
stock-based compensation expense of ($0.02) per diluted share.
Free cash flow for the second quarter of 2009 was $32.8 million.
During the second quarter of 2009, Bruker repaid $34.1 million of
debt, and ended the quarter with cash and cash equivalents of
$154.3 million, and net debt of $16.4 million.
Comment and Outlook
Frank Laukien, Bruker’s President and CEO, commented:
“Considering the challenging economic conditions in the industrial
markets, we are pleased with our performance in the second quarter
and first half of 2009. In the second quarter of 2009, we
experienced solid top line growth sequentially, while the
year-over-year revenue comparison was expected to be more difficult
due to our revenue spike in the second quarter of 2008. On the
bottom line, our cost-cutting measures, the strength of our new
product lines and the impact of our business initiatives had a
positive impact on our second quarter 2009 results, and contributed
to our 54% sequential growth in net income.”
Dr. Laukien continued: “During the second quarter we continued
to strengthen our product portfolio and launched several compelling
mass spectrometry products at ASMS 2009, while also introducing the
world’s first 1 Gigahertz NMR system. Our life-science mass
spectrometry business delivered strong double-digit revenue growth
and significant margin improvements in the second quarter of 2009.
Moreover, after the acquisition of the ACCEL RI business by our
Bruker Advanced Supercon business, we have established the new
Bruker Energy & Supercon Technologies division, which is
emerging as a global leader in superconductors and supercon
devices, as well as in advanced technologies for energy research
and next-generation grid infrastructure.”
Bruker’s Chief Financial Officer, Bill Knight, added: “While the
downturn in the global economy continues to be challenging to
navigate, we are relatively well positioned to handle these
challenges with our strong technology and IP base, our
high-performance product portfolio and our broad international
diversification. Moreover, we derive nearly 70% of our revenue from
universities and medical schools, as well as from other non-profit
and government customers, who tend to be less sensitive to economic
conditions. Going forward, we expect the global government stimulus
programs to have a positive impact on our high-end life-science and
research systems business, as well as on our new Bruker Energy
& Supercon Technologies division, starting in the second half
of 2009, accelerating in 2010, and continuing into 2011.”
Segment Information
After Bruker’s acquisition of the ACCEL Research Instruments
business on April 1, 2009, starting with the second quarter of
2009, Bruker has established two new reportable segments:
1) The Bruker Scientific Instruments (BSI) segment consists of
the four divisions Bruker AXS, Bruker BioSpin, Bruker Daltonics and
Bruker Optics.
2) The new Bruker Energy & Supercon Technologies (BEST)
segment which combines the acquired ACCEL RI business, and the
superconductor and supercon devices business that was previously
called Bruker Advanced Supercon, Inc.
Revenue in the BSI segment for the six months ended June 30,
2009 was $464.9 million, compared to BSI revenue of $533.5 million
for the six months ended June 30, 2008. Excluding the effects of
foreign currency translation, first half 2009 BSI revenue decreased
by 5.4% year-over-year. BSI net income for the six months ended
June 30, 2009 was $23.5 million, compared to $24.7 million for the
six months ended June 30, 2008. BSI earnings per diluted share for
the six months ended June 30, 2009 were $0.14, compared to $0.15
for the six months ended June 30, 2008.
Revenue in the BEST segment for the six months ended June 30,
2009 was $21.8 million, compared to BEST revenue of $22.4 million
for the six months ended June 30, 2008. Excluding the effects of
foreign currency translation, first half 2009 BEST revenue
increased by 12.3% year-over-year. BEST net loss for the six months
ended June 30, 2009 was ($3.4) million, compared to a net loss of
($4.0) million for the six months ended June 30, 2008. BEST loss
per diluted share for the six months ended June 30, 2009 was
($0.02), compared to ($0.02) for the six months ended June 30,
2008.
Following at the end of this press release is a non-GAAP table
reconciling the results of our reportable segments to the
consolidated results of Bruker Corporation.
USE OF NON-GAAP FINANCIAL MEASURES
In addition to the financial measures prepared in accordance
with generally accepted accounting principles (GAAP), we use the
measures of non-GAAP revenue, non-GAAP operating income, non-GAAP
net income and non-GAAP EPS, by reportable segment. We believe that
such non-GAAP measures helps investors to gain a better
understanding of our core operating results and future prospects,
consistent with how management measures and forecasts the Company’s
performance, especially when comparing such results to previous
periods or forecasts. However, the non-GAAP financial measures
included in this press release are not meant to be a better
presentation or a substitute for results of operations prepared in
accordance with GAAP. Reconciliations of such non-GAAP financial
measures to the most directly comparable GAAP financial measures
are set forth in the accompanying table. Specifically:
- Reconciliation of BSI and BEST
reportable segments to the consolidated results of Bruker
Corporation for the six months ended June 30, 2009 and 2008
EARNINGS CONFERENCE CALL
Bruker Corporation will host an operator-assisted earnings
conference call at 9:00 a.m. Eastern Daylight Time on Wednesday,
July 29, 2009. To listen to the webcast, investors can go to
http://ir.bruker.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 800-688-0796, or +1-617-614-4070
outside the US and Canada. Investors should refer to the Bruker
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 +1-617-801-6888 outside the
US and Canada, and then entering replay pass code 15184127. For
more information, please visit http://ir.bruker.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 adverse
changes in conditions in the global economy and volatility in the
capital markets, 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, 2008, 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
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS (unaudited)
(in millions, except per share
data)
Three Months
Ended June 30, Six Months Ended June 30, 2009
2008 2009 2008 Product revenue $ 222.9 $ 280.3
$ 425.1 $ 488.6 Service revenue 28.3 30.2 55.2 58.9 Other revenue
1.3 1.0 2.7 2.3
Total revenue 252.5 311.5 483.0 549.8 Cost of product
revenue 125.2 162.5 236.9 267.7 Cost of service revenue 16.1
19.4 32.2 38.5 Total cost
of revenue 141.3 181.9 269.1
306.2 Gross profit 111.2 129.6 213.9 243.6
Operating Expenses: Sales and marketing 43.9 47.1 86.5 91.5
General and administrative 17.0 17.2 33.3 34.0 Research and
development 31.1 36.5 60.2 67.7 Acquisition related, net
(1.0 ) 0.4 (0.6 ) 6.2 Total operating
expenses 91.0 101.2 179.4
199.4 Operating income 20.2 28.4 34.5 44.2
Interest and other income (expense), net (2.9 ) 3.6
(2.8 ) (8.6 ) Income before income tax
provision and noncontrolling interest in consolidated subsidiaries
17.3 32.0 31.7 35.6 Income tax provision 4.6
10.3 10.4 14.5 Net income 12.7
21.7 21.3 21.1 Net income (loss) attributable to noncontrolling
interests (0.2 ) - - 0.2
Net income attributable to Bruker Corporation $ 12.9 $ 21.7
$ 21.3 $ 20.9 Net income per common share
attributable to: Bruker Corporation shareholders: Basic and diluted
$ 0.08 $ 0.13 $ 0.13 $ 0.13 Weighted
average shares outstanding: Basic 163.3 162.4
163.3 162.4 Diluted 164.7
165.5 164.5 165.3
Bruker Corporation
CONDENSED CONSOLIDATED BALANCE
SHEETS (unaudited)
(in millions)
June 30, December 31,
2009 2008 ASSETS
Current assets: Cash, short-term investments and restricted cash $
154.3 $ 167.7 Accounts receivable, net 132.9 171.9 Inventories
436.4 425.1 Other current assets 65.6 56.0 Total
current assets 789.2 820.7 Property and equipment, net 221.3
221.3 Intangible and other assets 77.0 74.3
Total assets $ 1,087.5 $ 1,116.3
LIABILITIES AND
SHAREHOLDERS' EQUITY Current liabilities: Short-term
borrowings $ 43.1 $ 41.0 Accounts payable 40.8 43.3 Customer
deposits 202.1 199.6 Other current liabilities 233.2
235.8 Total current liabilities 519.2 519.7 Long-term debt
127.6 182.8 Other long-term liabilities 104.2 101.1 Total
shareholders' equity 336.5 312.7 Total
liabilities and shareholders' equity $ 1,087.5 $ 1,116.3
Reconciliation of BSI and BEST
reportable segments to the consolidated results of Bruker
Corporation for the six months ended June 30, 2009 and 2008
(unaudited)
(in millions, except per share
data)
Bruker Bruker Energy
& Corporate, Scientific Supercon
Adjustments June 30, 2009: Instruments
Technologies & Eliminations Consolidated
Revenue
$
464.9
$ 21.8 $ (3.7 ) $ 483.0 Operating Income 36.5 (3.1 ) 1.1
34.5 Net Income 23.5 (3.4 ) 1.2 21.3 Net Income Per
Diluted Share $ 0.14 $ (0.02 ) $ 0.01 $ 0.13 Dulited Shares
Outstanding 164.5 163.3 164.5 164.5
June 30, 2008:
Revenue $ 533.5 $ 22.4 $ (6.1 ) $ 549.8 Operating
Income 47.7 (3.7 ) 0.2 44.2 Net Income 24.7 (4.0 ) 0.2 20.9
Net Income Per Diluted Share $ 0.15 $ (0.02 ) $ 0.00 $ 0.13
Dulited Shares Outstanding 165.3 162.4 165.3 165.3
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