Bruker Corporation (NASDAQ: BRKR) today reported financial
results for the first quarter ended March 31, 2012.
First Quarter 2012 Highlights
- Revenue increased 13.6% year-over-year
to $405.6 million, or by 13.7% organically
- GAAP operating income increased 33.9%
year-over-year to $34.4 million
- Adjusted operating income increased
21.8% year-over-year to $43.6 million
- GAAP net income increased 33.6%
year-over-year to $15.1 million
- BSI segment adjusted EPS was $0.15,
beating guidance and consensus
Financial Results
In the first quarter of 2012, GAAP revenue was $405.6 million,
an increase of 13.6% compared to revenue of $357.0 million in the
first quarter of 2011. Excluding the effects of foreign currency
translation, first quarter revenue increased by 15.0%
year-over-year, and organic growth was 13.7%. GAAP operating income
in the first quarter of 2012 was $34.4 million, compared to $25.7
million in the first quarter of 2011, an increase of 33.9%.
Adjusted operating income in the first quarter of 2012 was $43.6
million, compared to $35.8 million in the first quarter of 2011, an
increase of 21.8%.
GAAP net income in the first quarter of 2012 was $15.1 million,
or $0.09 per diluted share, compared to GAAP net income of $11.3
million, or $0.07 per diluted share, in the first quarter of 2011,
an increase in net income of 33.6%. Adjusted net income in the
first quarter of 2012 was $23.8 million, or $0.14 per diluted
share, compared to adjusted net income of $21.3 million, or $0.13
per diluted share, in the first quarter of 2011, an increase in
adjusted net income of 11.7%.
For the first quarter of 2012, Bruker’s cash flow provided by
operations was $4.8 million, compared to cash used in operations of
($29.4) million in the first quarter of 2011.
As of March 31, 2012, Bruker had cash, cash equivalents and
restricted cash of $233.1 million, and net debt of $86.5
million.
Bruker Scientific Instruments (BSI) Segment
In the first quarter of 2012, BSI revenue was $378.1 million, an
increase of 12.6% compared to revenue of $335.8 million in the
first quarter of 2011. Excluding the effects of foreign currency
translation, BSI revenue in the first quarter increased by 13.7%
year-over-year, and organic growth was 12.4%. Adjusted operating
income for BSI increased by 15.9% in the first quarter of 2012 to
$43.7 million, compared to $37.7 million in the first quarter of
2011. Adjusted EPS for the BSI segment in the first quarter of 2012
was $0.15 per diluted share, compared to $0.15 per diluted share in
the first quarter of 2011.
Bruker Energy & Supercon Technologies (BEST)
Segment
In the first quarter of 2012, BEST revenue was $30.0 million, an
increase of 25.0% compared to revenue of $24.0 million in the first
quarter of 2011. Excluding the effects of foreign currency
translation, BEST revenue in the first quarter increased
organically by 30.4% year-over-year. In the first quarter of 2012,
BEST had adjusted operating income of $0.3 million, compared to an
adjusted operating loss of ($0.6) million in the first quarter of
2011. Adjusted net loss per diluted share for the BEST segment in
the first quarter of 2012 was ($0.01), compared to ($0.01) in the
first quarter of 2011.
Comment and Outlook
Frank Laukien, Bruker’s President and CEO, commented: “We are
pleased with our first quarter 2012 results, as we delivered 13.7%
organic revenue growth, along with double-digit growth in operating
income and net income year-over-year. Our backlog continued to grow
even further due to excellent first quarter 2012 orders. The tone
in many of our end markets has improved since the fourth quarter of
2011, and our focus on new products and innovative solutions for
major secular trends in the life and materials sciences and related
industries is resulting in excellent, profitable organic
growth.”
Dr. Laukien continued: “We also continue to expand our
addressable markets with new products and applications, along with
new product line acquisitions. During the first quarter we
purchased SkyScan B.V. which develops, manufactures and distributes
advanced, high-resolution micro computed tomography (CT) systems
for three-dimensional (3D) X-ray imaging. These products fit nicely
into our global materials research and preclinical imaging
channels, and complement our other X-ray analysis and preclinical
MRI products.”
Tom Rosa, the Chief Financial Officer of BEST, added: “Despite
excellent progress by BEST in the last three years, in March 2012
we withdrew our S-1 for BEST because of current equity market
conditions in our industry sectors, and in order to save on legal,
accounting, and other costs associated with keeping the S-1 filing
current. Moreover, Bruker Corporation has internally funded much of
the major BEST capacity expansion for metallic superconductors, as
well as important new product development programs for crystal
growth magnets (CGM), inductive superconducting fault current
limiters (iSFCL), and next-generation high-temperature
superconductor (HTS) scale-up.”
Mr. Rosa added: “As a result of the S-1 withdrawal, we can now
provide BEST segment guidance: for the year 2012, BEST expects
organic revenue growth of 15%, near break-even adjusted operating
income, and an adjusted loss per share of ($0.04). We are committed
to the success of BEST, as it continues to execute on its rapid
growth and emerging profitability strategy.”
Use of Non-GAAP Financial Measures
In addition to the financial measures prepared in accordance
with generally accepted accounting principles (GAAP), we use
certain non-GAAP financial measures, including adjusted EPS,
adjusted operating income, and adjusted net income and adjusted
operating margin, which exclude acquisition-related and
restructuring and other charges. We exclude the above items because
they are outside of our normal operations and/or, in certain cases,
are difficult to forecast accurately for future periods. We believe
that the use of 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.
For example:
We exclude certain acquisition-related charges or credits and
associated tax effects, including charges for the sale of
inventories revalued at the date of acquisition, significant
transaction costs such as legal fees and credits associated with
bargain purchases. We exclude these costs because we do not believe
they are indicative of our normal operating costs.
We exclude charges and tax effects associated with restructuring
and business divestiture activities, such as reducing overhead and
consolidating facilities. We believe that the costs related to
these restructuring and business divestiture activities are not
indicative of our normal operating costs.
We exclude the expense and tax effects associated with the
amortization of acquisition-related intangible assets because a
significant portion of the purchase price for acquisitions may be
allocated to intangible assets that have lives of 3 to 12 years.
Exclusion of these non-cash amortization expenses allows
comparisons of operating results that are consistent over time for
both our newly acquired and long-held businesses.
Bruker’s management uses these non-GAAP measures, in addition to
GAAP financial measures, as the basis for measuring the company’s
core operating performance and comparing such performance to that
of prior periods and to the performance of our competitors. Such
measures are also used by management in their financial and
operating decision-making and for compensation purposes.
The non-GAAP financial measures of Bruker’s results of
operations included in this press release are not meant to be
considered superior to or a substitute for Bruker’s 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
tables.
EARNINGS CONFERENCE CALL
Bruker Corporation will host an operator-assisted earnings
conference call at 9:00 a.m. Eastern Daylight Time on Tuesday, May
1, 2012. 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 78974051. For
more information, please visit http://ir.bruker.com
CAUTIONARY STATEMENT OF BRUKER CORPORATION
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 risks and
uncertainties that could cause actual results to differ materially
from those projected, including, but 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, the outcome of any actions that may be taken by
government agencies in connection with FCPA compliance matters we
have disclosed to them, 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 annual report on Form 10-K for the year ended
December 31, 2011, 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
INCOME (unaudited)
Three Months Ended (in millions, except per share
amounts) March 31, 2012 2011
Revenues $ 405.6 $ 357.0 Cost of revenues 215.2
195.2 Gross profit 190.4 161.8
Operating Expenses: Selling, general and administrative 104.4 89.3
Research and development 48.2 44.7 Other charges, net 3.4
2.1 Total operating expenses 156.0
136.1 Operating income 34.4 25.7
Interest and other income (expense), net (7.5 ) (5.0
) Income before income taxes and noncontrolling interest in
consolidated subsidiaries 26.9 20.7 Income tax provision
11.8 9.0 Consolidated net income 15.1
11.7 Net income attributable to noncontrolling interests in
consolidated subsidiaries - 0.4 Net
income attributable to Bruker Corporation $ 15.1 $ 11.3
Net income per common share attributable to Bruker
Corporation shareholders: Basic and diluted $ 0.09 $ 0.07
Weighted average common shares outstanding: Basic
165.7 165.1 Diluted 166.9
166.7
Reconciliation of BSI and BEST
reportable segments to the consolidated results of
Bruker Corporation for the three months
ended March 31, 2012 and 2011
(unaudited) (a) (b)
Segment Data Bruker (in millions, except
per share amounts) Bruker Energy &
Corporate, Consolidated Scientific
Supercon Adjustments Bruker Three Months
Ended March 31, 2012: Instruments Technologies
& Eliminations Corporation Revenue $ 378.1
$ 30.0 $ (2.5 ) $ 405.6 Gross profit - GAAP (a) $ 184.4 $
6.5 $ (0.5 ) $ 190.4 Cost of revenues charges (c) 0.7 - - 0.7
Amortization of acquisition-related intangible assets (d)
4.2 0.1 - 4.3
Gross profit - adjusted (b) $ 189.3 $ 6.6 $ (0.5 ) $
195.4 Gross profit margin - adjusted (b) 50.1 % 22.0 % 48.2
% Operating income (loss) - GAAP (a) $ 35.1 $ (0.3 ) $ (0.4
) $ 34.4 Cost of revenues charges (c) 0.7 - - 0.7 Amortization of
acquisition-related intangible assets (d) 5.0 0.1 - 5.1 Other
charges (e) 2.9 0.5 -
3.4 Operating income (loss) - adjusted (b) $ 43.7
$ 0.3 $ (0.4 ) $ 43.6 Operating margin -
adjusted (b) 11.6 % 1.0 % 10.7 % Net income (loss)
attributable to Bruker Corporation - GAAP (a) $ 17.1 $ (1.7 ) $
(0.3 ) $ 15.1 Cost of revenues charges (c) 0.5 - - 0.5 Amortization
of acquisition-related intangible assets (d) 4.8 0.1 - 4.9 Other
charges (e) 2.8 0.5 -
3.3 Net income (loss) attributable to Bruker
Corporation - adjusted (b) $ 25.2 $ (1.1 ) $ (0.3 ) $ 23.8
Diluted net income (loss) per common share attributable to Bruker
Corporation - GAAP (a) $ 0.10 $ (0.01 ) $ - $ 0.09 Cost of revenues
charges (c) - - - - Amortization of acquisition-related intangible
assets (d) 0.03 - - 0.03 Other charges (e) 0.02
- - 0.02 Diluted net
income (loss) per common share attributable to Bruker Corporation -
adjusted (b) $ 0.15 $ (0.01 ) $ - $ 0.14 Weighted average
shares outstanding: 166.9 165.7 165.7 166.9
Three Months Ended
March 31, 2011: Revenue $ 335.8 $ 24.0 $ (2.8 ) $ 357.0
Gross profit - GAAP (a) $ 158.3 $ 4.8 $ (1.3 ) $ 161.8 Cost
of revenues charges (c) 4.1 - - 4.1 Amortization of
acquisition-related intangible assets (d) 3.2
0.1 - 3.3 Gross profit -
adjusted (b) $ 165.6 $ 4.9 $ (1.3 ) $ 169.2
Gross profit margin - adjusted (b) 49.3 % 20.4 % 47.4 %
Operating income (loss) - GAAP (a) $ 27.7 $ (0.7 ) $ (1.3 ) $ 25.7
Cost of revenues charges (c) 4.1 - - 4.1 Amortization of
acquisition-related intangible assets (d) 3.8 0.1 - 3.9 Other
charges (e) 2.1 - -
2.1 Operating income (loss) - adjusted (b) $ 37.7
$ (0.6 ) $ (1.3 ) $ 35.8 Operating margin - adjusted
(b) 11.2 % (2.5 %) 10.0 % Net income (loss) attributable to
Bruker Corporation - GAAP (a) $ 14.1 $ (1.8 ) $ (1.0 ) $ 11.3 Cost
of revenues charges (c) 4.1 - - 4.1 Amortization of
acquisition-related intangible assets (d) 3.6 0.1 - 3.7 Other
charges (e) 2.2 - -
2.2 Net income (loss) attributable to Bruker
Corporation - adjusted (b) $ 24.0 $ (1.7 ) $ (1.0 ) $ 21.3
Diluted net income (loss) per common share attributable to Bruker
Corporation - GAAP (a) $ 0.09 $ (0.01 ) $ (0.01 ) $ 0.07 Cost of
revenues charges (c) 0.03 - - 0.03 Amortization of
acquisition-related intangible assets (d) 0.02 - - 0.02 Other
charges (e) 0.01 - -
0.01 Diluted net income (loss) per common share
attributable to Bruker Corporation - adjusted (b) $ 0.15 $ (0.01 )
$ (0.01 ) $ 0.13 Weighted average shares outstanding: 166.7
165.1 165.1 166.7
(a) “GAAP” (reported) results were determined in accordance with
U.S. generally accepted accounting principles (GAAP).
(b) Adjusted results are non-GAAP measures and for income
measures exclude certain charges to cost of revenues (see note c
for details); amortization of acquisition-related intangible assets
(see note d for details); restructuring and other charges (see note
e for details); and the tax consequences of the preceding
items.
(c) Reported results in the three month periods ended March 31,
2012 and 2011 include charges for the sale of inventories revalued
at the date of acquisition as well as charges to cost of goods sold
related to certain restructuring programs.
(d) Reported results in the three month periods ended March 31,
2012 and 2011 include non-cash charges for the amortization of
acquisition-related intangible assets.
(e) Reported results in the three month periods ended March 31,
2012 and 2011 include certain fees associated with legal compliance
and examinations, acquisition-related costs and other costs
associated with the restructuring and relocation of certain
operations.
The charges described in notes c, d and e have been tax effected
using enacted tax rates in the jurisdiction in which the charge was
recorded.
Bruker Corporation
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(in millions) March 31, December
31, 2012 2011 ASSETS
Current assets: Cash, cash equivalents and restricted cash $ 233.1
$ 248.2 Accounts receivable, net 261.8 282.8 Inventories 648.0
576.2 Other current assets 102.5 86.9 Total current
assets 1,245.4 1,194.1 Property, plant and equipment, net
261.8 249.0 Intangible and other long-term assets 290.1
267.4 Total assets $ 1,797.3 $ 1,710.5
LIABILITIES AND SHAREHOLDERS' EQUITY Current
liabilities: Short-term borrowings, including current portion of
long-term debt $ 76.3 $ 83.7 Accounts payable 87.0 72.3 Customer
advances 300.2 268.6 Other current liabilities 308.0
331.2 Total current liabilities 771.5 755.8 Long-term debt
243.3 219.4 Other long-term liabilities 120.4 110.4 Total
shareholders' equity 662.1 624.9 Total
liabilities and shareholders' equity $ 1,797.3 $ 1,710.5
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