-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VUZ6tkOvvSpfmniD7s8FScncMiVGhILEaoadIOR+uXwmpkAZkIHxc3F6Wj7RSKi4 ryYPKvXRDw1M2D8ikZR5PQ== 0000842023-09-000003.txt : 20090203 0000842023-09-000003.hdr.sgml : 20090203 20090203093645 ACCESSION NUMBER: 0000842023-09-000003 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20090203 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20090203 DATE AS OF CHANGE: 20090203 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TECHNE CORP /MN/ CENTRAL INDEX KEY: 0000842023 STANDARD INDUSTRIAL CLASSIFICATION: BIOLOGICAL PRODUCTS (NO DIAGNOSTIC SUBSTANCES) [2836] IRS NUMBER: 411427402 STATE OF INCORPORATION: MN FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-17272 FILM NUMBER: 09563208 BUSINESS ADDRESS: STREET 1: 614 MCKINLEY PL N E CITY: MINNEAPOLIS STATE: MN ZIP: 55413 BUSINESS PHONE: 6123798854 MAIL ADDRESS: STREET 1: 614 MCKINLEY PLACE NE CITY: MINNEAPOLIS STATE: MN ZIP: 55413 8-K 1 k8q.txt 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported): February 3, 2009 TECHNE CORPORATION (Exact Name of Registrant as Specified in Charter) Minnesota 0-17272 41-1427402 (State or Other Jurisdiction (Commission I.R.S. Employer of Incorporation) File Number) Identification No.) 614 Mckinley Place NE Minneapolis, MN 55413 (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (612) 379-8854 Not Applicable (Former Name or Former Address, if changed since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions: / / Written communications pursuant to Rule 425 under the Securities Act 17 CFR 230.425) / / Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) / / Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) / / Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02 Results of Operations and Financial Condition A copy of the press release issued by Techne Corporation on February 3, 2009, describing the results of operations for the quarter and six months ended December 31, 2008 and its financial condition as of December 31, 2008, is attached hereto as Exhibit 99.1. Segment information for Techne Corporation for the quarter and six months ended December 31, 2008 which has been included on Techne Corporation's website (www.techne-corp.com), is attached hereto as Exhibit 99.2. The information in this Form 8-K and the Exhibits attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such filing. Item 9.01 Financial Statements and Exhibits (d) Exhibits 99.1 Press Release dated February 3, 2009. 99.2 Segment information for the quarter and six months ended December 31, 2008. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Dated: February 3, 2009 TECHNE CORPORATION By: /s/ Thomas E. Oland --------------------------- Name: Thomas E. Oland Title: President and Chief Executive Officer EXHIBIT INDEX Exhibit No. Description ----------- ----------- 99.1 Press release of Techne Corporation dated February 3, 2009. 99.2 Segment information for Techne Corporation for the quarter and six months ended December 31, 2008. EX-99.1 2 release209.txt EARNINGS RELEASE TECHNE CORPORATION RELEASES UNAUDITED SECOND QUARTER RESULTS FOR FISCAL YEAR 2009 Minneapolis/February 3, 2009/--Techne Corporation's (NASDAQ: TECH) consolidated net earnings for the quarter ended December 31, 2008 were $23.6 million or $.62 per diluted share compared with $23.6 million or $.60 per diluted share for the quarter ended December 31, 2007. For the six months ended December 31, 2008, Techne's consolidated net earnings increased 11.8% to $52.2 million or $1.36 per diluted share compared with $46.7 million or $1.18 per diluted share for the six months ended December 31, 2007. Net earnings as a percentage of net sales improved to 39.8% for the six months ended December 30, 2008 from 38.9% in the first six months of last year. Foreign currency fluctuations and general economic conditions had a negative impact on consolidated net sales and earnings in the quarter ended December 31, 2008. The change in exchange rates used to convert foreign currencies (primarily British pound sterling and Euros) to U.S. dollars reduced net earnings by $1.5 million ($.04 per diluted share) for the quarter and $1.8 million ($.05 per diluted share) for the six months ended December 31, 2008, as compared to the same periods in last fiscal year. Consolidated net sales for the quarter and six months ended December 31, 2008 were $61.9 million and $131.2 million, respectively. This was a 0.4% decrease and 9.2% increase from the quarter and six months ended December 31, 2007, respectively. Consolidated net sales were negatively affected by the strength of the U.S. dollar as compared to foreign currencies. Excluding the effect of changes in foreign currency exchange rates, consolidated net sales increased 5.0% and 11.5% for the quarter ended and six months ended December 31, 2008, respectively, from the comparable prior-year periods. Biotechnology net sales, which include sales by R&D Systems' Biotechnology Division, R&D Systems China and BiosPacific, were $40.3 million and $86.5 million for the quarter and six months ended December 31, 2008, increases of 3.0% and 10.8%, respectively, from the comparable prior-year periods. North American biotechnology sales to industrial and academic customers grew at less than 2% during the second quarter of fiscal 2009. The Company attributes the lower second quarter sales growth rate to customer caution in a time of economic uncertainty. R&D Europe's net sales for the quarter and six months ended December 31, 2008 were $17.3 million and $36.2 million, a decrease of 9.2% and an increase of 5.1%, respectively, from the same prior-year periods. R&D Europe's net sales increased 8.6% for the quarter and 13.0% for the six months ended December 31, 2008 when measured at currency rates in effect in the comparable prior- year periods. Hematology net sales for the quarter and six months ended December 31, 2008 were $4.3 million and $8.5 million, increases of 7.2% and 11.5%, respectively, compared to the quarter and six months ended December 31, 2007. Consolidated gross margins were 78.3% and 79.8% for the quarter and six months ended December 31, 2008 respectively, compared to 79.5% and 79.3% for the quarter and six months ended December 31, 2007. The decrease in gross margins in the second quarter was primarily caused by lower gross margins in Europe resulting from unfavorable exchange rates. Selling, general and administrative expenses for the quarter and six months ended December 31, 2008 decreased $942,000 (8.9%) and $192,000 (1.0%), respectively from the quarter and six months ended December 31, 2007. The decrease in selling, general and administrative expenses from the comparable prior-year periods were the result of the following (in thousands): Quarter Six Months ------- ---------- Change in exchange rates to convert foreign expenses to U.S. dollars $ (685) $ (887) Reduction in profit sharing expense (670) (617) Other, including annual wage, salary and benefits increases 413 1,312 ------- ------- $ (942) $ (192) ======= ======= Second quarter selling, general and administrative expense increased from the first quarter of fiscal 2009 due primarily to costs associated with production, printing and mailing of the annual catalog and additional expense as a result of the annual grant of stock options to the Company's Board of Directors. Research and development expenses increased $283,000 (5.1%) and $1.0 million (9.4%), respectively, for the quarter and six months ended December 31, 2008 from the comparable prior-year periods. Interest income decreased $1.0 million and $1.2 million for the quarter and six months ended December 31, 2008, respectively, from the comparable prior- year periods, primarily as a result of lower rates of return on cash and available-for-sale investments and to a lesser extent to lower cash and available-for-sale investment balances. The effective tax rate was 30.8% for the quarter and 32.3% for the six months ended December 31, 2008 as compared to 33.6% for the quarter and six months ended December 31, 2007. Income tax expense in the second quarter of fiscal 2009 benefited from the renewal of the U.S. research and development credit. The $695,000 research and development tax credit for the quarter ended December 31, 2008, included credit for the January to June 2008 period in addition to a credit for the current year six-month period. Without significant business developments, the Company expects its fiscal 2009 effective income tax rate to range from approximately 32.5% to 33.5%. In November 2007, the Company's Board of Directors authorized the repurchase and retirement of up to $150 million of the Company's common stock. The Company repurchased approximately 960,000 shares of its common stock during the second quarter of fiscal 2009 for approximately $62.7 million. Approximately $20.0 million remains available for the repurchase of shares under this authorization. Forward Looking Statements: This earnings release contains forward-looking statements within the meaning of the Private Litigation Reform Act. These statements, including the Company's expectations as to consolidated income tax rates, involve risks and uncertainties that may affect the actual results of operations. The following important factors, among others, have affected and, in the future, could affect the Company's actual results: the introduction and acceptance of new biotechnology and hematology products, the levels and particular directions of research by the Company's customers, the impact of the growing number of producers of biotechnology research products and related price competition, general economic conditions, the retention of hematology OEM and proficiency survey business, the impact of currency exchange rate fluctuations, and the costs and results of research and product development efforts of the Company and of companies in which the Company has invested or with which it has formed strategic relationships. For additional information concerning such factors, see the Company's annual report on Form 10-K and quarterly reports on Form 10-Q as filed with the Securities and Exchange Commission. We undertake no obligation to update or revise any forward-looking statements we make in this release due to new information or future events. Investors are cautioned not to place undue emphasis on these statements. * * * * * * * * * * * * Techne Corporation has two operating subsidiaries: Research and Diagnostic Systems, Inc. (R&D Systems) of Minneapolis, Minnesota and R&D Systems Europe, Ltd. (R&D Europe) of Abingdon, England. R&D Systems is a specialty manufacturer of biological products. R&D Systems has two subsidiaries, BiosPacific, Inc. (BiosPacific), located in Emeryville, California and R&D Systems China Co. Ltd., (R&D China), located in Shanghai, China. BiosPacific is a worldwide supplier of biologics to manufacturers of in vitro diagnostic systems and immunodiagnostic kits. R&D China and R&D Europe distribute biotechnology products. Contact: Greg Melsen, Chief Financial Officer Kathy Backes, Controller (612) 379-8854 TECHNE CORPORATION CONSOLIDATED STATEMENTS OF EARNINGS (In thousands, except per share data) (Unaudited) QUARTER ENDED SIX MONTHS ENDED ------------------ ------------------ 12/31/08 12/31/07 12/31/08 12/31/07 -------- -------- -------- -------- Net sales $61,876 $62,142 $131,200 $120,129 Cost of sales 13,430 12,751 26,516 24,855 -------- -------- -------- -------- Gross margin 48,446 49,391 104,684 95,274 -------- -------- -------- -------- Operating expenses: Selling, general and administrative 9,703 10,645 18,543 18,735 Research and development 5,846 5,562 11,756 10,743 Amortization of intangible assets 240 282 480 570 -------- -------- -------- -------- Total operating expenses 15,789 16,489 30,779 30,048 -------- -------- -------- -------- Operating income 32,657 32,902 73,905 65,226 Other income (expense): Interest income 2,205 3,252 5,092 6,250 Other non-operating expense, net (712) (573) (1,899) (1,142) -------- -------- -------- -------- Total other income 1,493 2,679 3,193 5,108 -------- -------- -------- -------- Earnings before income taxes 34,150 35,581 77,098 70,334 Income taxes 10,528 11,942 24,883 23,623 -------- -------- -------- -------- Net earnings $23,622 $23,639 $52,215 $46,711 ======== ======== ======== ======== Earnings per share: Basic $ 0.62 $ 0.60 $ 1.36 $ 1.18 Diluted $ 0.62 $ 0.60 $ 1.36 $ 1.18 Weighted average common shares outstanding: Basic 37,894 39,395 38,259 39,442 Diluted 37,992 39,497 38,370 39,542 TECHNE CORPORATION CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) 12/31/08 6/30/08 -------- -------- ASSETS Cash and equivalents $119,595 $166,992 Short-term available-for-sale investments 24,366 39,353 Trade accounts receivable 24,852 31,747 Other receivables 4,701 1,585 Inventory 9,877 9,515 Other current assets 9,732 9,241 -------- -------- Current assets 193,123 258,433 -------- -------- Available-for-sale investments 85,493 87,384 Property and equipment, net 98,352 101,722 Goodwill and intangible assets, net 28,552 29,032 Other non-current assets 28,010 30,798 -------- -------- Total assets $433,530 $507,369 ======== ======== LIABILITIES Current liabilities $ 13,036 $ 20,239 Stockholders' equity 420,494 487,130 -------- -------- Total liabilities and equity $433,530 $507,369 ======== ======== EX-99.2 3 segment1208.txt SEGMENT RESULTS SEGMENT INFORMATION TECHNE CORPORATION AND SUBISIDARIES (in thousands of $'s, except per share data) Increase (Decrease) Fiscal 2009 From Fiscal 2008 ------------------------------ --------------------- First Second Percent First Second Qtr Qtr YTD Of Sales Qtr Qtr YTD ------ ------ ------- -------- ------ ------ ------- Sales 69,324 61,876 131,200 100% 11,337 (266) 11,071 Cost of sales 13,086 13,430 26,516 20% 982 679 1,661 ------ ------ ------- -------- ------ ------ ------- Gross margin 56,238 48,446 104,684 80% 10,355 (945) 9,410 Gross margin percentage 81.1% 78.3% 79.8% SG&A expense 8,840 9,703 18,543 14% 750 (942) (192) R&D expense 5,910 5,846 11,756 9% 729 284 1,013 Amortization expense 240 240 480 - (48) (42) (90) Interest income (2,887)(2,205) (5,092) (3%) 111 1,047 1,158 Other non-operating ex., net 1,187 712 1,899 1% 618 139 757 ------ ------ ------- -------- ------ ------ ------- 13,290 14,296 27,586 21% 2,160 486 2,646 ------ ------ ------- -------- ------ ------ ------- Earnings before income taxes 42,948 34,150 77,098 59% 8,195 (1,431) 6,764 Income taxes 14,355 10,528 24,883 19% 2,674 (1,414) 1,260 ------ ------ ------- -------- ------ ------ ------- 28,593 23,622 52,215 40% 5,521 (17) 5,504 ====== ====== ======= ======== ====== ====== ======= Diluted earnings per share .74 .62 1.36 Weighted average diluted shares outstanding 38,747 37,992 38,370 BIOTECHNOLOGY (1) (in thousands of $'s) Increase (Decrease) Fiscal 2009 From Fiscal 2008 ------------------------------ --------------------- First Second Percent First Second Qtr Qtr YTD Of Sales Qtr Qtr YTD ------ ------ ------- -------- ------ ------ ------- Sales 53,899 48,643 102,542 100% 8,571 2,067 10,638 Intersegment sales (7,762)(8,311)(16,073) (1,315) (878) (2,193) ------ ------ ------- ------ ------ ------- 46,137 40,332 86,469 7,256 1,189 8,445 Cost of sales 10,247 11,090 21,337 21% 1,250 1,478 2,728 Intersegment sales (7,461)(8,339)(15,800) (1,287) (909) (2,196) ------ ------ ------- ------ ------ ------- 2,786 2,751 5,537 (37) 569 532 ------ ------ ------- -------- ------ ------ ------- Gross margin 43,351 37,581 80,932 79% 7,293 620 7,913 Gross margin percentage 81.0% 77.2% 79.2% SG&A expense 5,141 5,418 10,559 10% 517 (116) 401 R&D expense 5,717 5,643 11,360 11% 715 275 990 Amortization expense 240 240 480 -- (48) (42) (90) Interest, net (1,084) (970) (2,054) (1%) 173 339 512 Exchange loss/(gain) (2) 1 (1) -- (36) (11) (47) ------ ------ ------- -------- ------ ------ ------- 10,012 10,332 20,344 20% 1,321 445 1,766 ------ ------ ------- -------- ------ ------ ------- Pretax result 33,339 27,249 60,588 59% 5,972 175 6,147 ====== ====== ======= ======== ====== ====== ======= (1) Includes R&D Systems' Biotechnology Division, BiosPacific, Inc. and R&D China R&D SYSTEMS EUROPE (in thousands of British pounds) Increase (Decrease) Fiscal 2009 From Fiscal 2008 ------------------------------ --------------------- First Second Percent First Second Qtr Qtr YTD Of Sales Qtr Qtr YTD ------ ------ ------- -------- ------ ------ ------- Sales 10,175 11,197 21,372 100% 2,570 1,896 4,466 Cost of sales 4,260 5,361 9,621 45% 805 1,308 2,113 ------ ------ ------- -------- ------ ------ ------- Gross margin 5,915 5,836 11,751 55% 1,765 588 2,353 Gross margin percentage 58.1% 52.1% 55.0% SG&A expense 1,224 1,364 2,588 12% 110 88 198 Interest income (790) (583) (1,373) (6%) (107) 190 83 Exchange loss/(gain) 260 (35) 225 1% 356 46 402 ------ ------ ------- -------- ------ ------ ------- 694 746 1,440 7% 359 324 683 ------ ------ ------- -------- ------ ------ ------- Pretax result 5,221 5,090 10,311 48% 1,406 264 1,670 ====== ====== ======= ======== ====== ====== ======= R&D SYSTEMS EUROPE (in thousands of $'s) Increase (Decrease) Fiscal 2009 From Fiscal 2008 ------------------------------ --------------------- First Second Percent First Second Qtr Qtr YTD Of Sales Qtr Qtr YTD ------ ------ ------- -------- ------ ------ ------- Sales 18,941 17,284 36,225 100% 3,492 (1,743) 1,749 Cost of sales 7,931 8,274 16,205 45% 911 (19) 892 ------ ------ ------- -------- ------ ------ ------- Gross margin 11,010 9,010 20,020 55% 2,581 (1,724) 857 Gross margin percentage 58.1% 52.1% 55.3% SG&A expense 2,283 2,094 4,377 12% 21 (505) (484) Interest income (1,471) (906) (2,377) (6%) (84) 670 586 Exchange loss 476 5 481 1% 674 170 844 ------ ------ ------- -------- ------ ------ ------- 1,288 1,193 2,481 7% 611 335 946 ------ ------ ------- -------- ------ ------ ------- Pretax result 9,722 7,817 17,539 48% 1,970 (2,059) (89) ====== ====== ======= ======== ====== ====== ======= HEMATOLOGY (in thousands of $'s) Increase (Decrease) Fiscal 2009 From Fiscal 2008 ------------------------------ --------------------- First Second Percent First Second Qtr Qtr YTD Of Sales Qtr Qtr YTD ------ ------ ------- -------- ------ ------ ------- Sales 4,246 4,260 8,506 100% 589 288 877 Cost of sales 2,369 2,405 4,774 56% 108 129 237 ------ ------ ------- -------- ------ ------ ------- Gross margin 1,877 1,855 3,732 44% 481 159 640 Gross margin percentage 44.2% 43.5% 43.9% SG&A expense 436 398 834 10% (31) (89) (120) R&D expense 193 203 396 4% 14 9 23 Interest, net (102) (91) (193) (2%) 18 34 52 ------ ------ ------- -------- ------ ------ ------- 527 510 1,037 12% 1 (46) (45) ------ ------ ------- -------- ------ ------ ------- Pretax result 1,350 1,345 2,695 32% 480 205 685 ====== ====== ======= ======== ====== ====== ======= CORPORATE AND OTHER (2) (in thousands of $'s) Increase (Decrease) Fiscal 2009 From Fiscal 2008 --------------------- --------------------- First Second First Second Qtr Qtr YTD Qtr Qtr YTD ------ ------ ------- ------ ------ ------- Interest income 230 238 468 (4) (4) (8) Rental income 99 131 230 32 20 52 ------ ------ ------- ------ ------ ------- 329 369 698 28 16 44 SG&A expense 980 1,793 2,773 243 (232) 11 Other-Building expenses 553 551 1,104 9 (49) (40) Other-Equity Investment losses 259 286 545 3 49 52 ------ ------ ------- ------ ------ ------- 1,792 2,630 4,422 255 (232) 23 ------ ------ ------- ------ ------ ------- Pretax result (1,463)(2,261) (3,724) (227) 248 21 ====== ====== ======= ====== ====== ======= (2) Unallocated corporate expenses and Techne's share of losses by Hemerus Medical, LLC and Nephromics, LLC. -----END PRIVACY-ENHANCED MESSAGE-----