Bio-Rad Laboratories Reports Fourth-Quarter and Full-year 2005 Results

HERCULES, Calif., Feb. 22  /PRNewswire-FirstCall/ -- Bio-Rad Laboratories, Inc. (Amex: BIO; BIOb), a multinational manufacturer and distributor of life science research products and clinical diagnostics, announced financial results today for the fourth quarter and fiscal year ended December 31, 2005. Net revenues from continuing operations were $307.3 million for the fourth quarter, essentially flat versus the prior-year quarter.  On a currency- neutral basis, however, revenues were up 2.9% over the same period last year. During the quarter, the Life Science segment experienced a reduction in revenue as well as higher incremental expenses as it absorbed the impact of the injunction by a Connecticut Federal District Court stopping all sales and manufacturing in the United States of the Company's MJ Research line of thermal cycling products.  For the quarter, income from continuing operations was $13.5 million compared to $17.1 million in the fourth quarter of last year.  Quarterly net income was negatively impacted by a one-time, non-cash charge of $19.8 million of pre-tax impairment expenses primarily due to the write-down of intangible assets associated with the acquisition of MJ Research.  These negatives were partially offset by fourth-quarter pre-tax gains of approximately $11 million associated with the liquidation of our positions in Instrumentation Laboratory S.p.A. and BioSource International.

For the full year, Company sales from continuing operations grew by 8.3% to $1,181.0 million compared to $1,090.0 million in 2004.  Normalizing for the impact of currency effects, growth was 7.3%.  This growth was largely due to organic growth in Bio-Rad's two main business segments.  Year-over-year income from continuing operations grew by 17.0% to $77.6 million, or $2.98 per share, from $66.3 million, or $2.58 per share in 2004.  Full-year gross margin from continuing operations was 54.7%, down from last year's figure of 56.0%.  The decline in gross margin was largely attributable to sales mix coupled with price erosion in our BSE (bovine spongiform encephalopathy or mad cow disease) business.

  Fourth-Quarter Highlights

   *    Overall net sales from continuing operations for the fourth quarter
        were flat versus the prior-year quarter.
   *    Fourth-quarter basic earnings from continuing operations were $0.51
        per share, or $0.50 per share on a diluted basis, compared to $0.66
        and $0.65, respectively, in the same period of last year.
   *    Compared to their respective figures in 2004, segment net sales for
        the quarter were 5.3% lower for the Life Science segment and 4.0%
        higher for the Clinical Diagnostics segment.  The lower revenues in
        the Life Science segment were due in large part to the injunction on
        sales and manufacturing of our MJ Research line of products in the
        United States.



Life Science segment net sales for the quarter were $140.7 million, down 5.3% compared to the fourth quarter of last year.  On a currency-neutral basis, segment sales contracted by 1.8%.  Full-year reported revenues from continuing operations were $549.9 million for the segment, up 9.0% over the prior year, or 8.2% on a currency-neutral basis.  Performance in this segment was boosted by a number of factors including sales increases in the protein expression analysis, automated electrophoresis, amplification reagents and biotechnology education product areas.  The iQTM5 real time amplification platform also gained market acceptance.  However, segment results continued to be negatively impacted by erosion in the average selling price of BSE tests. This erosion is due primarily to increased competition in the marketplace coupled with a reduction in the overall number of animals being tested.  Also during the quarter, the segment experienced a reduction in revenue due to the aforementioned injunction.  In February of 2006, the Company settled its dispute with Applera and Roche, enabling the resumption of sales of thermal cycling products.

The Clinical Diagnostics segment reported net sales of $162.9 million for the quarter, up 4.0% compared to the prior-year quarter, or 6.7% excluding currency effects.  Full-year segment sales from continuing operations were $618.4 million, a 7.3% increase compared to 2004 results, or 5.9% excluding currency effects.  These results are due in part to continued growth in the blood virus, diabetes monitoring and quality controls product lines.  U.S. Sales of the segment's Platelia(TM) Aspergillus enzyme immunoassay (EIA) were also up significantly over last year.  During the year, the Clinical Diagnostics Group launched a number of products including the new MRSA select chromogenic media, which detects Methicillin-resistant Staphylococcus aureus.

  2005 Highlights

   *    Full-year Company sales from continuing operations grew by 8.3% to
        $1,181.0 million.
   *    Year-over-year income from continuing operations grew by 17.0% to
        $77.6 million from $66.3 million in 2004.
   *    Certain one-time tax benefits caused the Company's effective tax
        rate on income from continuing operations to fall for the year to
        16.9%.
   *    In July, Bio-Rad and Sysmex America, Inc., signed a co-marketing
        agreement in which the two companies will jointly market their
        complementary products, the Bio-Rad VARIANT(TM) II TURBO HST
        Hemoglobin Testing System and the Sysmex HST-N(TM) Hematology
        Automation Line, as a complete, integrated testing solution. This
        combination of Bio-Rad's market-leading assay for hemoglobin A1C and
        Sysmex's automated testing platform will enable laboratories to
        provide superior diabetes monitoring services to doctors and their
        patients throughout the United States.
   *    In October, Bio-Rad announced a second collaboration agreement with
        Caliper Life Sciences, Inc. to investigate development of another
        novel microfluidic system.
   *    The Company's new Experion(TM) automated electrophoresis system was
        well received by customers worldwide, especially for use in protein
        profiling applications.
   *    In November, the Company received approval for its medical decision
        support software (MDSS) from the U.S. Food and Drug Administration
        (FDA) for its new BioPlex(R) 2200 system, an automated immunoassay
        platform capable of analyzing for multiple disease states from
        single patient samples.  The system improves both test quality and
        turnaround time, and renders the diagnostic process far less labor-
        intensive.
   *    Pfizer's Exubera(R) inhalable insulin product was recently approved
        by the U.S. Food and Drug Administration for the treatment of adults
        with type 1 and type 2 diabetes.  Bio-Rad's Macro-Prep(R) process
        chromatography support is an integral part of the purification of
        the insulin used in this product.
   *    In December, Bio-Rad renewed a collaboration agreement with the
        Institut Pasteur of Paris, France for an additional four years.
        This relationship gives Bio-Rad exclusive commercialization rights
        to Pasteur's research developments in the areas of virology,
        microbiology, physiology, biochemistry, parasitology and mycology.



"2005 was a dynamic year," said Norman Schwartz, President and Chief Executive Officer.  "Underneath it all is a solid business in which we see real opportunities as we head into 2006."

Management will discuss these results in a conference call at 2:00 p.m. PT (5:00 p.m. ET) February 22, 2006. Interested parties can access the call by dialing 866-825-3209 (in the U.S.), or 617-213-8061 (international), access number 61793659.  The live web cast can be accessed at http://www.bio-rad.com/.  A replay of the call will be available at 888-286-8010 (in the U.S.), or 617-801-6888 (international), access number 98718856, for seven days following the call and the web cast can be accessed at http://www.bio-rad.com/ for 30 days.

Bio-Rad Laboratories, Inc., is a multinational manufacturer and distributor of life science research products and clinical diagnostics.  Based in Hercules, California, Bio-Rad serves more than 70,000 research and industry customers worldwide through a network of more than 30 wholly owned subsidiary offices.

Various statements made within this press release may constitute "forward- looking statements" for purposes of the Securities and Exchange Commission's "safe harbor" provisions under the Private Securities Litigation Reform Act of 1995 and Rule 3b-6 under the Securities Exchange Act of 1934. The forward- looking statements contained herein involve risks and uncertainties that could cause results to differ materially from the Company's expectations.

                        Bio-Rad Laboratories, Inc.

               Condensed Consolidated Statements of Income

                  (in thousands, except per share data)

                               (UNAUDITED)

                                     Three Months         Twelve Months
                                       Ended                  Ended
                                     December 31,          December 31,
                                   2005      2004       2005        2004
  Net sales                      $307,287  $307,868  $1,180,985  $1,090,012
  Cost of goods sold              144,662   139,533     534,499     479,939
  Gross profit                    162,625   168,335     646,486     610,073

  Selling, general and
   administrative expense         109,626   110,825     416,084     378,264
  Product research and
   development expense             31,109    31,885     115,104     108,344
  Purchased in-process research
   and development expense             --        --          --      14,620
  Impairment expenses              19,770        --      19,770          --
  Interest expense                  8,272     5,255      32,643      20,219
  Foreign exchange (gains)
   losses, net                       (232)      774      (1,528)      2,394
  Other (income) expense, net     (14,925)   (7,789)    (28,958)    (11,095)
  Income from continuing
   operations before taxes          9,005    27,385      93,371      97,327
  Provision for income taxes       (4,447)   10,274      15,792      31,035
  Income from continuing
   operations                      13,452    17,111      77,579      66,292
  Discontinued operations              --        --       3,974       1,950
  Net income                      $13,452   $17,111     $81,553     $68,242

  Basic earnings per share
      Continuing operations         $0.51     $0.66       $2.98       $2.58
      Discontinued operations          --        --        0.15        0.07
      Net income                    $0.51     $0.66       $3.13       $2.65

      Weighted average common
       shares                      26,203    25,819      26,063      25,724

  Diluted earnings per share
      Continuing operations         $0.50     $0.65       $2.91       $2.51
      Discontinued operations          --        --        0.15        0.07
      Net income                    $0.50     $0.65       $3.06       $2.58

      Weighted average common
       shares                      26,770    26,528      26,662      26,489


                        Bio-Rad Laboratories, Inc.
                  Condensed Consolidated Balance Sheets

                              (In thousands)
                               (UNAUDITED)

                                               December 31,     December 31,
                                                   2005              2004
  Current Assets:
       Cash and cash equivalents                 $296,716          $195,734
       Restricted cash                             36,138                --
       Short-term investments                     116,343           165,899
       Accounts receivable, net                   247,192           261,243
       Inventories, net                           212,342           205,512
       Other current assets                        99,480            80,072
            Total current assets                1,008,211           908,460

  Net property, plant and equipment               180,258           202,324
  Goodwill                                        113,276           113,276
  Purchased intangibles, net                       28,449            58,638
  Other assets                                     96,388            88,920
            Total assets                       $1,426,582        $1,371,618



  Current liabilities:
       Notes payable and current
        maturities of long-term debt               $3,341            $9,457
       Accounts payable                            72,950            71,194
       Accrued payroll and employee
        benefits                                   81,076            79,061
       Sales, income and other taxes
        payable                                    15,841            15,835
       Other current liabilities                  146,035           139,828
            Total current liabilities             319,243           315,375

  Long-term debt, net of current
   maturities                                     425,687           425,979
  Other long-term liabilities                      23,678            33,376
  Stockholders' equity                            657,974           596,888
            Total liabilities and
             stockholders' equity              $1,426,582        $1,371,618

   Certain items have been reclassified to conform to the current year
                              presentation.


                        Bio-Rad Laboratories, Inc.
             Condensed Consolidated Statements of Cash Flows

                              (In thousands)
                               (UNAUDITED)

                                                     Twelve Months
                                                    Ended December 31,
                                                 2005               2004

  Cash flows from operating activities:
      Cash received from customers            $1,166,711        $1,087,946
      Cash paid to suppliers and employees    (1,003,264)         (920,606)
      Interest paid                              (31,334)          (19,543)
      Income tax payments                        (39,597)          (33,637)
      Miscellaneous receipts                      15,768             8,933
      Net cash provided by operating
       activities                                108,284           123,093

  Cash flows from investing activities:
      Capital expenditures, net                  (36,055)          (60,493)
      Other investing activities                  29,883          (125,825)
      Net cash used in investing activities       (6,172)         (186,318)

  Cash flows from financing activities:
      Long-term borrowings                            --           200,000
      Payments on long-term debt                    (447)           (1,781)
      Other financing activities                   1,737            (4,992)
      Net cash provided by (used in)
       financing activities                        1,290           193,227

  Effect of exchange rate changes on cash         (2,420)              337

  Net increase in cash and cash equivalents      100,982           130,339
  Cash and cash equivalents at
   beginning of period                           195,734            65,395
  Cash and cash equivalents at end of period    $296,716          $195,734


  Reconciliation of net income to net
   cash provided by operating
   activities:

  Net income                                     $81,553           $68,242
  Adjustments to reconcile income from
   continuing operations to net cash
   provided by operating activities
   (net of effects of acquisitions):
      Depreciation and amortization               60,974            56,143
      Impairment expense                          19,770                --
      Changes in working capital                 (31,599)           (5,531)
      Other                                      (22,414)            4,239
  Net cash provided by operating
   activities                                   $108,284          $123,093

   Certain items have been reclassified to conform to the current year
                              presentation.


DATASOURCE: Bio-Rad Laboratories, Inc.



CONTACT:  Christine Tsingos, Vice President and Chief Financial Officer,

or Ron Hutton, Treasurer, both of Bio-Rad Laboratories, Inc., [phone],

or 



Web site:  http://www.bio-rad.com/ 

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