BRKR Bruker Corporation

Bruker BioSciences Corporation (NASDAQ: BRKR) today reported first quarter 2005 revenue of $74.9 million, a 9.9% increase from revenue of $68.2 million in the first quarter of 2004. Revenue during the first quarter of 2005 included favorable foreign currency effects of approximately 3.6%, compared to the first quarter in 2004. First quarter 2005 operating income was $2.5 million, compared to operating income of $1.4 million in the first quarter of 2004. Net income in the first quarter of 2005 was $0.4 million, or $0.00 per diluted share, compared to net income of $0.5 million, or $0.01 per diluted share, in the first quarter of 2004. Commenting on the quarter, Frank Laukien, President and CEO said: "We are pleased to report another quarter of solid top-line growth and sequential improvements in our bottom-line performance. Continued improvements in our profitability remain our top priority. Revenue growth at both of our operating businesses was robust and reflects our strong product portfolio. Moreover, market reaction to many of our new products recently introduced at Pittcon in March 2005 has been very favorable. Although we have recently seen a modest slow-down in certain markets we serve, we believe that we can continue our above industry-average top-line organic growth momentum throughout 2005 due to our competitive offerings and healthy backlog." William Knight, Chief Financial Officer, commented: "We continue to make progress with our spending control and productivity programs, and over the last several quarters these efforts have steadily improved our operating and net income. In addition, we generated positive operating cash flow of approximately $5 million during the first quarter of 2005. I am also encouraged that in the first quarter of 2005 our gross profit margins improved by 1.7% year-over-year. We anticipate that our above average growth, continued gross margin improvements and disciplined expense control, as well as gradual reductions in our interest expense and effective tax rate, will bring us to industry-standard profitability over the next several years." Mr. Knight continued: "As we are in a capital equipment business and typically sell 'big ticket' items, we occasionally experience fluctuations in our quarterly results, but we remain optimistic that we will achieve our management targets for revenue growth and profitability for the full year 2005." OPERATING BUSINESSES Set forth below is selected financial information for Bruker BioSciences' two operating businesses: Bruker Daltonics (life-science mass spectrometry and NBC detection business) and Bruker AXS (x-ray analysis business): BRUKER DALTONICS In the first quarter of 2005, revenue for the Bruker Daltonics business increased 10% to $42.6 million, from $38.8 million in the first quarter of 2004. Bruker Daltonics' revenue was derived 70% from life-science mass spectrometry systems, 10% from substance detection systems, and 20% from after-market sales. EBITDA was $4.3 million for the first quarter of 2005, compared to $3.2 million for the first quarter of 2004. BRUKER AXS In the first quarter of 2005, revenue for the Bruker AXS business increased 11% to $32.5 million, from $29.3 million in the first quarter of 2004. Bruker AXS' revenue was derived 74% from x-ray systems sales and 26% from after-market sales. EBITDA was $2.1 million in the first quarter of 2005, compared to $0.9 million in the first quarter of 2004. USE OF NON-GAAP FINANCIAL MEASURES In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), we use the non-GAAP measure of EBITDA. EBITDA is defined as US GAAP operating income (loss) excluding depreciation and amortization expense. We believe that the inclusion of this non-GAAP measure 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 measure included in this press release is not meant to be a better presentation or a substitute for results of operations prepared in accordance with GAAP. Reconciliations of this non-GAAP financial measure to the most directly comparable GAAP financial measures are set forth in the accompanying tables. EARNINGS CONFERENCE CALL Bruker BioSciences will host an operator-assisted earnings conference call at 5 p.m. Eastern Time on Thursday, May 5, 2005. To listen to the webcast, investors can go to www.bruker-biosciences.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 888-339-2688, or 617-847-3007 outside the US and Canada. Investors should refer to the Bruker BioSciences Quarterly 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 617-801-6888 outside the US and Canada, and then entering replay pass code 31669862. ABOUT BRUKER BIOSCIENCES Bruker BioSciences Corporation, headquartered in Billerica, Massachusetts, is the publicly traded parent company of Bruker Daltonics Inc. and Bruker AXS Inc. Bruker AXS is a leading developer and provider of life science and advanced materials research tools based on x-ray technology. Bruker Daltonics is a leading developer and provider of innovative life science tools based on mass spectrometry. Bruker Daltonics also offers a broad line of nuclear, biological and chemical (NBC) detection products for defense and homeland security. For more information, please visit www.bruker-biosciences.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 the Company's reorganization strategies, integration risks, failure of conditions, technological approaches, product development, market acceptance, cost and pricing of the Company's products, exposure to currency fluctuations, changes in governmental regulations, capital spending and government funding policies, FDA and other regulatory approvals to the extent applicable, competition, the intellectual property of others, patent protection and litigation. These and other factors are identified and described in more detail in our filings with the SEC, including, without limitation, our respective annual reports on Form 10-K for the year ended December 31, 2004, 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. Condensed consolidated statements of operations, operating business information, and balance sheets follow for Bruker BioSciences Corporation. -0- *T Bruker BioSciences Corporation CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) Three Months Ended March 31, ----------------------------- 2005 2004 -------------- ------------- Product sales $66,824 $59,037 Service sales 7,755 8,865 Other sales 332 252 -------------- ------------- Total sales 74,911 68,154 Cost of product sales 38,265 34,783 Cost of service sales 5,267 6,052 -------------- ------------- Total cost of sales 43,532 40,835 -------------- ------------- Gross Profit Margin 31,379 27,319 Operating Expenses: Sales and marketing 12,152 11,828 General and administrative 5,668 4,143 Research and development 11,020 9,940 -------------- ------------- Total Operating Expenses 28,840 25,911 -------------- ------------- Operating income 2,539 1,408 Interest and other income (expense), net (130) 99 -------------- ------------- Income before income tax provision and minority interest in consolidated subsidiaries 2,409 1,507 Provision for income taxes 1,925 1,020 -------------- ------------- Income before minority interest 484 487 Minority interest in consolidated subsidiaries 67 11 -------------- ------------- Net income $417 $476 ============== ============= Net income per share: Basic $0.00 $0.01 ============== ============= Diluted $0.00 $0.01 ============== ============= Weighted average shares outstanding: Basic 89,471 86,463 ============== ============= Diluted 89,581 86,793 ============== ============= Bruker BioSciences Corporation BRUKER DALTONICS SELECTED OPERATING BUSINESS INFORMATION (in thousands) Three Months Ended March 31, ---------------------------------- 2005 2004 ---------------- ----------------- Sales $42,644 $38,827 ================ ================= Operating income $2,975 $1,778 Depreciation and amortization 1,347 1,386 ---------------- ----------------- EBITDA $4,322 $3,164 ================ ================= Bruker BioSciences Corporation BRUKER AXS SELECTED OPERATING BUSINESS INFORMATION (in thousands) Three Months Ended March 31, ---------------------------------- 2005 2004 ---------------- ----------------- Sales $32,514 $29,327 ================ ================= Operating income (loss) $822 $(170) Depreciation and amortization 1,301 1,022 ---------------- ----------------- EBITDA $2,123 $852 ================ ================= Bruker BioSciences Corporation CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) March 31, December 31, 2005 2004 --------------- -------------- (unaudited) ASSETS Current assets: Cash and short-term investments $84,822 $77,691 Accounts receivable, net 57,091 57,792 Due from affiliated companies 9,973 9,530 Inventories 103,444 107,748 Other current assets 16,936 18,530 --------------- -------------- Total current assets 272,266 271,291 Property and equipment, net 80,033 84,990 Intangible and other assets 15,149 15,266 --------------- -------------- Total assets $367,448 $371,547 =============== ============== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Short-term borrowings $15,740 $12,205 Accounts payable 16,585 22,652 Due to affiliated companies 6,757 3,026 Other current liabilities 72,622 73,277 --------------- -------------- Total current liabilities 111,704 111,160 Long-term debt 26,263 27,763 Other long-term liabilities 16,774 15,156 Minority interest in subsidiaries 260 193 Total shareholders' equity 212,447 217,275 --------------- -------------- Total liabilities and shareholders' equity $367,448 $371,547 =============== ============== *T