Bruker Corporation (NASDAQ: BRKR) today reported financial
results for the third quarter ended September 30, 2009.
Third Quarter 2009 Highlights
- Revenue $265.1 million
- GAAP Net Income $16.4
million
- GAAP EPS $0.10 per diluted
share
- Free cash flow $14.2
million
Financial Results
In the third quarter of 2009, revenue was $265.1 million, an
increase of 9.5% compared to revenue of $242.1 million in the third
quarter of 2008. Excluding the effect of foreign currency
translation, third quarter 2009 revenue increased 11.4%
year-over-year. GAAP net income for the third quarter of 2009 was
$16.4 million, or $0.10 per diluted share, compared to GAAP net
income of $17.8 million, or $0.11 per diluted share, in the third
quarter of 2008. Included in GAAP EPS in the third quarter of 2008
were (i) one-time tax benefits of $0.07 per diluted share and (ii)
non-cash stock-based compensation expense of ($0.01) per diluted
share. Included in GAAP EPS in the third quarter of 2009 was
non-cash stock-based compensation expense of ($0.01) per diluted
share.
For the nine months ended September 30, 2009, revenue was $748.1
million, a decrease of 5.5% compared to revenue of $791.9 million
in the first three quarters of 2008. Excluding the effect of
foreign currency translation, revenue for the nine months ended
September 30, 2009 increased by 0.5% year-over-year. GAAP net
income for the nine months ended September 30, 2009 was $37.7
million, or $0.23 per diluted share, compared to GAAP net income of
$38.7 million, or $0.23 per diluted share, for the nine months
ended September 30, 2008. Included in GAAP EPS for the nine months
ended September 30, 2008 were (i) one-time tax benefits of $0.07
per diluted share, (ii) Bruker BioSpin acquisition related expenses
of ($0.04) per diluted share, and (iii) non-cash stock-based
compensation expense of ($0.02) per diluted share. Included in GAAP
EPS for the nine months ended September 30, 2009 was non-cash
stock-based compensation expense of ($0.02) per diluted share.
Free cash flow was $14.2 million in the third quarter of 2009,
and $58.4 million for the nine months ended September 30, 2009,
compared to a use of cash of ($11.9) million for the third quarter
of 2008, and a use of cash of ($20.9) million for the nine months
ended September 30, 2008. During the third quarter of 2009, Bruker
repaid $19.3 million of debt, ending the quarter with cash and cash
equivalents of $150.5 million, and net debt of $0.8 million,
compared to net debt of $127.6 million at the end of the third
quarter of 2008.
Comment and Outlook
Frank Laukien, Bruker’s President and CEO, commented: “We are
pleased with our double-digit currency-adjusted third quarter 2009
year-over-year revenue growth, with our solid sequential
improvements in revenue, operating margins and net income during
the first three quarters of 2009, and with our strong free cash
flow year-to-date. Our third quarter 2009 operating income
increased more than 70% year-over-year, and our operating margin
improved sequentially by 180 basis points, when compared to the
second quarter 2009.”
Dr. Laukien continued: “During the third quarter we have seen
positive sequential trends in bookings throughout the company, even
in the divisions with a greater industrial markets exposure. We
have also begun to see robust bookings from our academic and
government customers who are benefiting from various global
government stimulus programs. While we expect a strong fourth
quarter of 2009, we believe that most of the anticipated positive
revenue and margin effects from global stimulus orders will be
reflected in Bruker’s financial results in 2010 and 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 which
consists of the four divisions Bruker AXS, Bruker BioSpin, Bruker
Daltonics and Bruker Optics.
2) The Bruker Energy & Supercon Technologies (BEST) segment
which combines the acquired ACCEL RI business, and the
superconductor and supercon devices business, which was previously
called Bruker Advanced Supercon, Inc.
Revenue in the BSI segment for the nine months ended September
30, 2009 was $716.5 million, compared to BSI revenue of $767.3
million for the nine months ended September 30, 2008. Excluding the
effects of foreign currency translation, for the first nine months
of 2009, BSI revenue decreased by 1.0% year-over-year. BSI net
income for the nine months ended September 30, 2009 was $41.7
million, compared to $45.3 million for the nine months ended
September 30, 2008. BSI earnings per diluted share for the nine
months ended September 30, 2009 were $0.25, compared to $0.27 for
the nine months ended September 30, 2008.
Revenue in the BEST segment for the nine months ended September
30, 2009 was $36.0 million, compared to BEST revenue of $32.5
million for the nine months ended September 30, 2008. Excluding the
effects of foreign currency translation, for the first nine months
of 2009, BEST revenue increased by 23.4% year-over-year. BEST net
loss for the nine months ended September 30, 2009 was ($5.0)
million, compared to a net loss of ($6.8) million for the nine
months ended September 30, 2008. BEST loss per diluted share for
the nine months ended September 30, 2009 was ($0.03), compared to
($0.04) for the nine months ended September 30, 2008.
Following at the end of this press release are reconciliations
of certain non-GAAP measures presented in this release.
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 net income, non-GAAP EPS by
reportable segment, and non-GAAP free cash flow for Bruker
Corporation. We believe that such non-GAAP measures help 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 nine months ended September 30, 2009 and
2008
- Reconciliation of Free Cash
Flow
EARNINGS CONFERENCE CALL
Bruker Corporation will host an operator-assisted earnings
conference call at 9:00 a.m. Eastern Daylight Time on Thursday,
October 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 94562291. 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, that could cause actual future results to differ
materially from those projected including, 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, realization of
anticipated benefits from economic stimulus programs, intellectual
property rights, litigation, and exposure to foreign currency
fluctuations and other risk factors discussed from time to time in
our filings with the Securities and Exchange Commission. These and
other factors are identified and described in more detail in our
filings with the SEC, including, without limitation, our recent
Proxy Statements on Schedule 14A, 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
expressly 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 September
30, Nine Months Ended September 30, 2009
2008 2009 2008 Product revenue $ 230.7
$ 211.8 $ 655.8 $ 700.4 Service revenue 32.4 28.8 87.6 87.7 Other
revenue 2.0 1.5 4.7
3.8 Total revenue 265.1 242.1 748.1 791.9 Cost
of product revenue 127.9 114.6 364.8 382.3 Cost of service revenue
18.0 16.4 50.2
54.9 Total cost of revenue 145.9 131.0
415.0 437.2 Gross profit
119.2 111.1 333.1 354.7 Operating Expenses: Sales and
marketing 44.1 45.2 130.6 136.7 General and administrative 17.5
17.7 50.8 51.7 Research and development 31.6 33.1 91.8 100.8
Acquisition related, net - -
(0.6 ) 6.2 Total operating expenses 93.2
96.0 272.6 295.4
Operating income 26.0 15.1 60.5 59.3 Interest and
other income (expense), net (1.8 ) 0.8
(4.6 ) (7.8 ) Income before income tax provision and
noncontrolling interest in consolidated subsidiaries 24.2 15.9 55.9
51.5 Income tax provision 8.1 (2.0 )
18.5 12.5 Net income 16.1 17.9 37.4
39.0 Net income (loss) attributable to noncontrolling interests
(0.3 ) 0.1 (0.3 ) 0.3 Net
income attributable to Bruker Corporation $ 16.4 $ 17.8
$ 37.7 $ 38.7 Net income per common
share attributable to: Bruker Corporation shareholders: Basic $
0.10 $ 0.11 $ 0.23 $ 0.24 Diluted $
0.10 $ 0.11 $ 0.23 $ 0.23
Weighted average shares outstanding: Basic 163.5
162.8 163.4 162.5 Diluted
165.0 165.9 164.7
165.6
Bruker Corporation
CONDENSED CONSOLIDATED BALANCE
SHEETS (unaudited)
(in millions)
September 30, December 31,
2009 2008 ASSETS
Current assets: Cash, short-term investments and restricted cash $
150.5 $ 167.7 Accounts receivable, net 151.7 171.9 Inventories
443.6 425.1 Other current assets 72.7 56.0 Total
current assets 818.5 820.7 Property and equipment, net 226.4
221.3 Intangible and other assets 79.3 74.3
Total assets $ 1,124.2 $ 1,116.3
LIABILITIES AND
SHAREHOLDERS' EQUITY Current liabilities: Short-term
borrowings $ 30.9 $ 41.0 Accounts payable 45.5 43.3 Customer
deposits 197.1 199.6 Other current liabilities 247.5
235.8 Total current liabilities 521.0 519.7 Long-term debt
120.4 182.8 Other long-term liabilities 109.3 101.1 Total
shareholders' equity 373.5 312.7 Total
liabilities and shareholders' equity $ 1,124.2 $ 1,116.3
Reconciliation of BSI and BEST
reportable segments to the consolidated results of Bruker
Corporation for the nine months ended September 30, 2009 and 2008
(unaudited)
(in millions, except per share
data)
Bruker Bruker Energy
& Corporate, Scientific Supercon
Adjustments GAAP September 30, 2009:
Instruments Technologies & Eliminations
Consolidated Revenue $ 716.5 $ 36.0 $ (4.4 ) $ 748.1
Operating Income (Loss) 63.4 (4.3 ) 1.4 60.5 Net
Income (Loss) 41.7 (5.0 ) 1.0 37.7 Net Income (Loss) Per
Diluted Share $ 0.25 $ (0.03 ) $ 0.01 $ 0.23 Diluted Shares
Outstanding 164.7 163.4 164.7 164.7
September 30,
2008: Revenue $ 767.3 $ 32.5 $ (7.9 ) $ 791.9
Operating Income (Loss) 65.7 (6.6 ) 0.2 59.3 Net Income
(Loss) 45.3 (6.8 ) 0.2 38.7 Net Income (Loss) Per Diluted
Share $ 0.27 $ (0.04 ) $ 0.00 $ 0.23 Diluted Shares Outstanding
165.6 162.5 165.6 165.6
Reconciliation of Free Cash
Flow of Bruker Corporation (unaudited)
(in millions)
Three Months Ended Nine Months Ended
September 30, September 30, 2009
2008 2009 2008 Cash flow from
operations $ 16.0 $ 0.8 $ 67.3 $ 18.9 Capital expenditures
(1.8 ) (12.7 ) (8.9 ) (39.8 )
Free cash flow $ 14.2 $ (11.9 ) $ 58.4 $ (20.9 )
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