EX-99 6 exhibit99.htm PRESS RELEASE

     

PRESS RELEASE

LIFE SCIENCES RESEARCH, INC.

 

(NYSE Arca: LSR)

 

P.O. Box 2360

 

Mettlers Road

 

East Millstone, NJ 08875-2360

 

 

 

For Further Information:

 

Richard Michaelson

 

Phone: US (732) 649-9961

 

e-mail: LifeSciencesResearch@LSRinc.net
                              
                                   

April 29, 2008                     

                         

LSR ANNOUNCES FIRST QUARTER 2008 FINANCIAL RESULTS
 

Highlights:     

·     

Revenues of $63.2 million

·     

Operating income of $9.7 million, or 15.3%

·     

Net income of $6.7 million, or $0.44 per fully diluted share

·     

Net new orders of $71.4 million, TTM book to bill ratio of 1.11



East Millstone, New Jersey, April 29, 2008 – Life Sciences Research, Inc. (NYSE Arca: LSR) announced today that revenues for the quarter ended March 31, 2008 were $63.2 million, 16.4% above the revenues for the same period in the prior year of $54.3 million. Excluding the effect of exchange rate movements, revenues increased 15.3%. Operating income for the quarter ended March 31, 2008 was $9.7 million, or 15.3% of revenues, compared with $6.2 million, or 11.5% of revenues for the same period in the prior year. The quarter included FAS123R stock option expenses of $0.5 million, or $0.03 per fully diluted share compared with $0.6 million or $0.04 per fully diluted share in the same quarter last year. The Company reported net income for the quarter ended March 31, 2008 of $6.7 million compared with $3.5 million for the quarter ended March 31, 2007. Net income per common share was $0.53 for the three months ended March 31, 2008 compared with $0.27 for the three months ended March 31, 2007. Net income per fully diluted share was $0.44 for the three months ended March 31, 2008 compared with $0.23 for the three months ended March 31, 2007.

The net income for the quarter ended March 31, 2008 included Other Expense of $0.5 million which comprised finance arrangement fee amortization of $0.4 million and $0.1 million from the non-cash foreign exchange re-measurement loss on the long-term loan denominated in US dollars. In the same period in the prior year, Other Expense of $0.4 million was comprised of finance arrangement fee amortization of $0.5 million, offset by $0.1 million non-cash foreign exchange re-measurement gain pertaining to the long-term loan denominated in US dollars.

Cash and short-term investments at March 31, 2008 was $26.6 million compared with $36.2 million at December 31, 2007. Operating activities used cash of $1.5 million, of which $6.9 million was due to the increase in Days Sales Outstanding (DSO). Net DSO at March 31, 2008 were 23 compared with 13 days at December 31, 2007. Capital expenditure totaled $4.8 million in the first quarter of 2008, compared to $4.0 million in the first quarter of 2007.
 
Net new orders totaled $71.4 million for the first quarter of 2008 which represented an increase of 7.7% over first quarter orders in 2007. This resulted in a book to bill ratio of 1.13 for the quarter, and a trailing twelve month (“TTM”) book to bill of 1.11. At March 31, 2008 backlog (booked on work) amounted to approximately $196 million.

Brian Cass, LSR’s President and Managing Director commented, “I’m delighted with the solid footing that our first quarter’s results represent, with record constant currency revenues and earnings. Our investment in expanded staffing and targeted infrastructure improvements is helping us to profitably meet the growing demand for our services, and we look forward to building on those strengths throughout the year and beyond. ”
 
Andrew Baker, LSR’s Chairman and CEO said, “This is an encouraging time for our industry, and an exciting time for our Company. We continue to see robust industry demand for outsourced safety testing of both pharmaceutical and biologic products, and our strong new business wins in the past quarter and year are testament to our ability to convert that opportunity. We’re buoyed by the confidence our customers place in us, proud of the commitment of our staff, and pleased with the growing interest and support from the investment community. ”

LSR management will host an investor conference call to discuss the quarter’s results on April 30, 2008 at 9:00 a.m. Eastern time. Shareholders and other interested parties may participate in the conference call by dialing +1 (210) 234-0017 and entering pass code 3316789 a few minutes before the scheduled call.

About Life Sciences Research, Inc.
 
Life Sciences Research, Inc. is a global contract research organization providing product development services to the pharmaceutical, agrochemical and biotechnology industries. LSR brings leading technology and capability to support its clients in non-clinical safety testing of new compounds in early stage development and assessment. The purpose of this work is to identify risks to humans, animals or the environment resulting from the use or manufacture of a wide range of chemicals which are essential components of LSR's clients' products. The Company's services are designed to meet the regulatory requirements of governments around the world. LSR operates research facilities in the United States (the Princeton Research Center, New Jersey) and the United Kingdom (Huntingdon and Eye, England).

Forward Looking Statements

This announcement contains statements that may be forward-looking as defined by the Private Securities Litigation Reform Act of 1995. These statements are based largely on LSR’s expectations and are subject to a number of risks and uncertainties, certain of which are beyond LSR’s control, as more fully described in the Company’s SEC filings, including its Form 10-K for the fiscal year ended December 31, 2007, as filed with the US Securities and Exchange Commission.

- tables to follow -

Life Sciences Research Inc. and Subsidiaries
Condensed Consolidated Statements of Operations

Unaudited

 

Three months ended
March 31

  
     

(Dollars in thousands, except per share data)

2008

  

2007

  
         

Net revenues

$63,227

  

$54,297

  

Cost of sales

(43,364)

  

(40,283)

  

Gross profit

19,863

  

14,014

  

Selling, general and administrative expenses

(10,199)

  

(7,795)

  

Operating income

9,664

  

6,219

  

Interest income

323

  

382

  

Interest expense

(2,661)

  

(3,460)

  

Other expense

(520)

  

(439)

  

Income before income taxes

6,806

  

2,702

  

Income tax (expense)/benefit

(71)

  

752

  

Net income

$6,735

  

$3,454

  
         

Income per share

        

- Basic

$0.53

  

$0.27

  

- Diluted

$0.44

  

$0.23

  
         

Weighted average number of common stock

        

- Basic (000’s)

12,633

  

12,782

  

- Diluted (000’s)

15,406

  

15,056

  


Life Sciences Research Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Dollars in thousands)

March 31,

  

December 31,
 

2008

  

2007

ASSETS

Unaudited

  

Audited

Current assets:

      

Cash and cash equivalents

$26,605

  

$32,304

Short-term investments

-

  

3,919

Accounts receivable, net

34,955

  

30,116

Unbilled receivables, net

25,169

  

25,935

Inventories

2,463

  

2,530

Prepaid expenses and other current assets

10,264

  

9,270

Total current assets

$99,456

  

$104,074
       

Property and equipment, net

73,193

  

70,994

Goodwill

7,269

  

7,268

Other assets

7,908

  

8,382

Deferred income taxes

10,795

  

10,865

Total assets

$198,621

  

$201,583
       

LIABILITIES AND STOCKHOLDERS’ EQUITY/(DEFICIT)

    

Current liabilities:

      

Accounts payable

$12,086

  

$15,477

Accrued payroll and other benefits

8,060

  

6,644

Accrued expenses and other liabilities

28,885

  

33,086

Short-term debt

455

  

618

Fees invoiced in advance

44,453

  

47,347

Total current liabilities

$93,939

  

$103,172
       

Long-term debt, net

75,302

  

75,429

Deferred gain on disposal of US property

8,707

  

8,787

Pension liabilities

42,515

  

43,522

Total liabilities

$220,463

  

$230,910
       

Commitments and contingencies

      

Stockholders’ equity/(deficit)

      

Preferred Stock, $0.01 par value. Authorized 5,000,000

      

Issued and outstanding: None

-

  

-

Non-Voting Common Stock, $0.01 par value. Authorized 5,000,000

    

Issued and outstanding: None

-

  

-

Voting Common Stock, $0.01 par value. Authorized 50,000,000

      

Issued and outstanding at March 31, 2008: 12,645,598 (December 31, 2007: 12,626,498)

126

  

126

Paid in capital

87,739

  

87,216

Accumulated other comprehensive loss

(46,648)

  

(46,875)

Accumulated deficit

(63,059)

  

(69,794)

Total stockholders’ deficit

(21,842)

  

(29,327)

Total liabilities and stockholders’ deficit

$198,621

  

$201,583


 

Life Sciences Research Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

Unaudited

 

Three months ended March 31

(Dollars in thousands)

2008

  

2007
       

Cash flows from operating activities:

      

Net income

$6,735

  

$3,454

Adjustments to reconcile net income to net cash (used in)/ provided by operating activities:

      

Depreciation and amortization

2,506

  

2,229

Amortization of gain on disposal of US property

(80)

  

(80)

Non-cash compensation expense associated with employee stock compensation plans

474

  

558

Foreign exchange loss/(gain) on long-term loan

50

  

(110)

Foreign exchange loss/(gain) on intercompany balances

10

  

(12)

Deferred income tax expense/(benefit)

71

  

(752)

Provision for losses on accounts receivable

36

  

85

Interest expense related to the amortization of debt issue costs

503

  

451

Amortization of financing costs

460

  

387
       

Changes in operating assets and liabilities:

      

Accounts receivable, unbilled receivables and prepaid expenses

(5,193)

  

2,401

Inventories

71

  

(234)

Accounts payable, accrued expenses and other liabilities

(4,321)

  

1,117

Fees invoiced in advance

(2,810)

  

616

Net cash (used in)/provided by operating activities

$(1,488)

  

$10,110
       

Cash flows used in investing activities:

      

Purchase of property, plant and equipment

(4,754)

  

(3,981)

Sale of property, plant and equipment

-

  

6

Payment for acquisition

(1,771)

  

-

Sale of short-term investments

3,919

  

-

Net cash used in investing activities

$(2,606)

  

$(3,975)
       

Cash flows (used in)/provided by financing activities:

      

Proceeds from issuance of Voting Common Stock

49

  

35

Repayments of long-term borrowings

(600)

  

-

Repayments of short-term borrowings

(216)

  

(213)

Net cash used in financing activities

$(767)

  

$(178)
       

Effect of exchange rate changes on cash and cash equivalents

(838)

  

10

(Decrease)/increase in cash and cash equivalents

(5,699)

  

5,967

Cash and cash equivalents at beginning of period

32,304

  

44,088

Cash and cash equivalents at end of period

$26,605

  

$50,055
       

Supplementary Disclosures

      

Interest paid

$2,102

  

$2,934

Taxes paid

$80

  

$128