Bruker (NASDAQ:BRKR)
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Bruker Corporation (NASDAQ:BRKR) today reported financial results for
the fourth quarter and year ended December 31, 2007, now including the
results of the Bruker BioSpin Group.
On February 26, 2008, Bruker BioSciences Corporation closed its
acquisition of the Bruker BioSpin Group, and renamed itself Bruker
Corporation. Under US GAAP, this transaction is accounted for as an
acquisition of businesses under common control, and as a result all
one-time transaction costs are expensed in the period in which they are
incurred, rather than being added to goodwill. In addition, after the
closing of the transaction all historical consolidated balance sheets,
statements of operations, statements of cash flows and notes to the
consolidated financial statements in future filings with the Securities
and Exchange Commission will be restated by combining the historical
consolidated financial statements of Bruker Corporation with those of
the Bruker BioSpin Group. The information contained herein will discuss
the combined financial results of Bruker Corporation, as it legally
exists since the closing on February 26, 2008, and which now include the
financial results of the Bruker BioSpin Group (“Combined”).
These will be compared in some categories to the historical, standalone
financial results of Bruker BioSciences Corporation, as it legally
existed on December 31, 2007 (“Standalone”).
Combined Financial Results of Bruker Corporation
In the fourth quarter of 2007, Combined revenue increased by 31% to
$343.1 million, compared to Combined revenue of $261.5 million in the
fourth quarter of 2006. Excluding the effects of foreign currency
translation, Combined fourth quarter 2007 revenue increased by 22%
year-over-year. Combined fourth quarter 2007 revenue of $343.1 million
was 87% higher than Standalone fourth quarter 2007 revenue of $183.7
million, as previously reported by Bruker BioSciences Corporation.
Combined net income in the fourth quarter of 2007 increased to $37.0
million, or $0.22 per diluted share, compared to Combined net income of
$35.6 million, or $0.22 per diluted share, in the fourth quarter of
2006. Included in Combined GAAP net income for the fourth quarter of
2007 were after-tax charges of $6.9 million, or $0.04 per diluted share,
for expenses related to the acquisition of the Bruker BioSpin Group.
Combined fourth quarter 2007 net income of $37.0 million was 164% higher
than Standalone fourth quarter 2007 net income of $14.0 million, as
previously reported by Bruker BioSciences Corporation. Combined fourth
quarter 2007 earnings per diluted share of $0.22 were 69% higher than
Standalone fourth quarter 2007 earnings per diluted share of $0.13, as
previously reported by Bruker BioSciences Corporation.
For the full year 2007, Combined revenue increased by 21% to $1,032.4
million, compared to Combined revenue of $851.0 million for the full
year 2006. Excluding the effects of foreign currency translation,
Combined 2007 revenue increased by 15% year-over-year, including 1%
growth from acquisitions, and organic growth of 14%. Combined 2007
revenue was 89% higher than Standalone 2007 revenue of $547.6 million,
as previously reported by Bruker BioSciences Corporation.
Combined net income in 2007 increased 30% to $97.2 million, or $0.59 per
diluted share, compared to Combined net income of $74.8 million, or
$0.47 per diluted share, in 2006. Included in Combined GAAP net income
for 2007 were after-tax charges of $7.4 million, or $0.05 per diluted
share, for expenses related to the acquisition of the Bruker BioSpin
Group. For comparison, included in Combined GAAP net income for the year
2006 were after-tax charges of $5.0 million, or $0.03 per diluted share,
for expenses related to the acquisition of Bruker Optics, which was
completed on July 1, 2006.
Combined 2007 net income of $97.2 million was 208% higher than the
Standalone 2007 net income of $31.5 million, as previously reported by
Bruker BioSciences Corporation. Combined 2007 earnings per diluted share
of $0.59 were 97% higher than the Standalone 2007 earnings per diluted
share of $0.30, as previously reported by Bruker BioSciences Corporation.
Combined cash flow from operations in 2007 was $127.1 million, compared
to $82.8 million in 2006. Combined free cash flow, defined as operating
cash flow less capital expenditures, was $101.8 million during 2007,
compared to $61.7 million during 2006. As of December 31, 2007, the
Combined Bruker Corporation had net cash of $290.4 million.
Comment and Outlook
Frank Laukien, President and CEO, commented: “The
addition of the Bruker BioSpin Group to Bruker Corporation represents a
significant step-up in our combined financial performance. We are
extremely pleased that our overall rapid growth has enabled the Combined
Bruker to cross the billion-dollar-revenue threshold already in 2007,
with Combined, currency-adjusted 2007 revenue growth of 15%. Moreover,
we have reached new levels of profitability and cash flow with Combined
2007 Bruker net income of $97 million and free cash flow of $102
million. Our Combined 2007 GAAP EPS of $0.59 was nearly twice the
previously reported Standalone 2007 EPS of $0.30 of Bruker BioSciences
Corporation.”
Bill Knight, CFO, continued with an outlook for the year 2008: “Our
markets in 2007 were strong, yet going forward there is considerable
economic uncertainty. Under the assumption that the overall market
conditions we face will not deteriorate significantly, our financial
goals for the full year 2008 include:
revenue growth greater than 8%,
operating margins greater than 14%, excluding expenses associated with
the acquisition of the Bruker BioSpin Group,
net income margins greater than 9%, excluding expenses associated with
the acquisition of the Bruker BioSpin Group, and
improved balance sheet metrics and operating cash flows.
It should be kept in mind that with the addition of the Bruker BioSpin
Group, we expect that quarterly fluctuations in our financial results
will increase.”
EARNINGS CONFERENCE CALL
Bruker Corporation will host an operator-assisted earnings conference
call at 8 a.m. Eastern Time on Monday, March 17, 2008. To listen to the
webcast, investors can go to www.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
888-339-2688, or 617-847-3007 outside the US and Canada. Investors
should refer to the Bruker Corporation 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 13763010.
ABOUT BRUKER CORPORATION (NASDAQ:BRKR)
As of February 26, 2008, Bruker Corporation has become the parent
company of the entire Bruker group of companies. Bruker Corporation now
operates in two segments, the life science and analytical (LSA) systems
segment, and the international advanced superconductor (IAS) segment.
For more information, please visit www.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 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, 2006, 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 (including Bruker BioSpin Group)CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS(in thousands,
except per share data)
Three Months EndedDecember 31,
Twelve Months EndedDecember 31,
2007
2006
2007
2006
Product revenue
$
303,875
$
233,845
$
913,238
$
758,532
Service revenue
37,758
25,938
115,419
87,873
Other revenue
1,438
1,762
3,791
4,602
Total revenue
343,071
261,545
1,032,448
851,007
Cost of product revenue
157,207
115,539
489,246
399,182
Cost of service revenue
24,407
15,991
73,591
53,207
Total cost of revenue
181,614
131,530
562,837
452,389
Gross profit margin
161,457
130,015
469,611
398,618
Operating Expenses:
Sales and marketing
45,965
39,069
156,783
131,393
General and administrative
17,165
14,739
59,600
51,853
Research and development
30,289
27,227
110,751
102,611
Acquisition related charges
6,868
(105
)
7,412
5,724
Total operating expenses
100,287
80,930
334,546
291,581
Operating income
61,170
49,085
135,065
107,037
Interest and other income (expense), net
1,206
(1,493
)
5,750
4,716
Income before income tax provision and minority interest in
consolidated subsidiaries
62,376
47,592
140,815
111,753
Income tax provision
25,378
12,043
43,278
36,927
Income before minority interest in consolidated subsidiaries
36,998
35,549
97,537
74,826
Minority interest in consolidated subsidiaries
44
(67
)
299
8
Net income
$
36,954
$
35,616
$
97,238
$
74,818
Net income per share:
Basic
$
0.23
$
0.22
$
0.60
$
0.47
Diluted
$
0.22
$
0.22
$
0.59
$
0.47
Weighted average shares outstanding:
Basic
162,053
159,046
161,247
159,057
Diluted
164,725
160,915
164,314
160,106
Bruker Corporation (including Bruker BioSpin Group)CONDENSED
CONSOLIDATED BALANCE SHEETS(in thousands)
December 31,
December 31,
2007
2006
ASSETS
Current assets:
Cash and short-term investments
$
344,504
$
325,689
Accounts receivable, net
185,217
147,693
Inventories
447,688
408,892
Other current assets
57,288
46,306
Total current assets
1,034,697
928,580
Property and equipment, net
207,588
190,442
Intangible and other assets
69,346
57,558
Total assets
$
1,311,631
$
1,176,580
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term borrowings
$
34,846
$
27,190
Accounts payable
52,293
46,407
Other current liabilities
474,052
430,821
Total current liabilities
561,191
504,418
Long-term debt
6,394
26,995
Other long-term liabilities
107,656
71,648
Minority interest in subsidiaries
538
239
Total shareholders' equity
635,852
573,280
Total liabilities and shareholders' equity
$
1,311,631
$
1,176,580