EX-99.1 2 a18-12745_1ex99d1.htm EX-99.1

Exhibit 99.1

 

 

Bruker Reports First Quarter 2018 Financial Results

 

BILLERICA, Mass.May 3, 2018 — Bruker Corporation (NASDAQ: BRKR) today announced financial results for its first quarter ended March 31, 2018.

 

Bruker’s revenues for the first quarter of 2018 were $431.7 million, an increase of 12.2% compared to the first quarter of 2017. In the first quarter of 2018, Bruker’s year-over-year organic revenue growth was 4.0%, while the favorable effect from changes in foreign currency rates was 7.7%, and growth from acquisitions was 0.5%.

 

First quarter 2018 GAAP operating income was $38.1 million, compared to $37.6 million in the first quarter of 2017. Non-GAAP operating income was $52.9 million, compared to $49.2 million in the first quarter of 2017. On a non-GAAP basis, Bruker’s first quarter 2018 operating margin was 12.3%, compared to 12.8% in the first quarter of 2017. The year-over-year decline in non-GAAP operating margin was primarily attributable to a strong unfavorable impact from changes in foreign currency rates, which more than offset healthy operational margin improvement in the first quarter.

 

First quarter 2018 GAAP diluted earnings per share (EPS) were $0.17, compared to $0.13 in the first quarter of 2017. First quarter 2018 non-GAAP diluted EPS were $0.24, a 26.3% increase over non-GAAP diluted EPS of $0.19 in the first quarter of 2017. A reconciliation of non-GAAP to GAAP financial measures is provided in the tables accompanying this press release.

 

Frank Laukien, President and CEO of Bruker, commented: “Bruker is off to a solid start in 2018 with 4% organic revenue growth and strong EPS improvement. We remain focused on our key priorities of portfolio transformation and operational excellence. With healthy end markets, organic growth improvements in our Scientific Instruments segment, and continued good operational execution in the quarter, we believe that Bruker is on track to deliver on our 2018 financial commitments.”

 

Bruker’s guidance for fiscal year 2018 revenue growth, non-GAAP operating margin expansion and non-GAAP EPS is unchanged.

 

Quarterly Earnings Call

 

Bruker will host a conference call and webcast to discuss its financial results, business outlook, and related corporate and financial matters today at 4:30 p.m. Eastern Daylight Time. To listen to the webcast, investors can go to https://ir.bruker.com and click on the “Events & Presentations” hyperlink.  A slide presentation that will be referenced during the webcast will be posted to the Company’s website shortly before the webcast begins.  Investors can also listen to the earnings webcast via telephone by dialing 1-888-437-2685 (US toll free) or +1-412-317-6702 (international), and referencing “Bruker’s First Quarter 2018 Earnings Conference Call”.  A telephone replay of the conference call will be available by dialing 1-877-344-7529 (US toll free) or +1-412-317-0088 (international) and entering conference number: 10119735. The replay will be available beginning one hour after the end of the conference through June 3, 2018.

 

About Bruker Corporation

 

For more than 55 years, Bruker has enabled scientists to make breakthrough discoveries and develop new applications that improve the quality of human life. Bruker’s high-performance scientific instruments and high-value analytical and diagnostic solutions enable scientists to explore life and materials at molecular, cellular and microscopic levels. In close cooperation with our customers, Bruker is enabling innovation, improved productivity and customer success in life science molecular research, in applied and pharma applications, in

 



 

microscopy and nanoanalysis, and in industrial applications, as well as in cell biology, preclinical imaging, clinical phenomics and proteomics research and clinical microbiology. For more information, please visit: www.bruker.com.

 

Use of Non-GAAP Financial Measures

 

To supplement our consolidated financial statements, which are prepared and presented in accordance with U.S. generally accepted accounting principles (GAAP), we use the following non-GAAP financial measures in this press release and in the earnings webcast: non-GAAP gross profit; non-GAAP gross profit margin; non-GAAP operating income; non-GAAP operating margin; non-GAAP profit before tax; non-GAAP tax rate; non-GAAP net income and non-GAAP earnings per share. These non-GAAP measures exclude costs related to restructuring actions, acquisition and related integration expenses, amortization of acquired intangible assets and other non-operational costs.

 

We also refer to organic revenue growth and free cash flow in this press release and in the earnings webcast, which are also non-GAAP financial measures. We define the term organic revenue as GAAP revenue excluding the effect of changes in foreign currency translation rates and the effect of acquisitions and divestitures, and believe it is a useful measure to evaluate our continuing business. We define free cash flow as net cash provided by operating activities less additions to property, plant, and equipment. We believe free cash flow is a useful measure to evaluate our business because it indicates the amount of cash generated after additions to property, plant, and equipment that is available for, among other things, acquisitions, investments in our business, repayment of debt and return of capital to shareholders.

 

The presentation of these non-GAAP financial measures is not intended to be a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP and may be different from non-GAAP financial measures used by other companies, and therefore, may not be comparable among companies.  We believe these non-GAAP financial measures provide meaningful supplemental information regarding our performance. Specifically, management believes that the non-GAAP measures mentioned above provide relevant and useful information which is widely used by analysts, investors and competitors in our industry, as well as by our management, in assessing both consolidated and business unit performance.

 

We use these non-GAAP financial measures to evaluate our period-over-period operating performance because our management believes this provides a more comparable measure of our continuing business by adjusting for certain items that are not reflective of the underlying performance of our business. These measures may also be useful to investors in evaluating the underlying operating performance of our business and forecasting future results.  We regularly use these non-GAAP financial measures internally to understand, manage, and evaluate our business results and make operating decisions.  We also measure our employees and compensate them, in part, based on such non-GAAP measures and use this information for our planning and forecasting activities.

 

Additional information relating to these non-GAAP financial measures and reconciliations to the most directly comparable GAAP financial measures is provided in the tables accompanying this press release following our GAAP financial statements and in our slide presentation, which is available through the “Bruker Earnings Release” hyperlink on Bruker’s Investor Relations web site ir.bruker.com.

 

With respect to the Company’s outlook for 2018 non-GAAP operating margin, non-GAAP EPS and non-GAAP tax rate, we are not providing the most directly comparable GAAP financial measures or corresponding reconciliations to such GAAP financial measures on a forward-looking basis, because we are unable to predict with reasonable certainty certain items that may affect such measures calculated and presented in accordance with GAAP without unreasonable effort. Our expected non-GAAP operating margin, tax rate and EPS ranges exclude primarily the future impact of restructuring actions, unusual gains and losses, acquisition-related expenses and purchase accounting fair value adjustments. These reconciling items are uncertain, depend on various factors outside our management’s control and could significantly impact, either individually or in the aggregate, our future period operating margins, EPS and tax rate calculated and presented in accordance with GAAP.

 

Forward Looking Statements

 

Any statements contained in this press release which do not describe historical facts may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any forward-

 



 

looking statements contained herein are based on current expectations, but are subject to risks and uncertainties that could cause actual results to differ materially from those indicated, including, but not limited to, risks and uncertainties relating to adverse changes in conditions in the global economy and volatility in the capital markets, the integration of businesses we have acquired or may acquire in the future, fluctuations in foreign currency exchange rates, our ability to successfully implement our restructuring initiatives, changing technologies, product development and market acceptance of our products, the cost and pricing of our products, manufacturing, competition, dependence on collaborative partners, key suppliers and contract manufacturers, capital spending and government funding policies, changes in governmental regulations, the use and protection of intellectual property rights, litigation, and other risk factors discussed from time to time in our filings with the Securities and Exchange Commission, or SEC. 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, 2017 and subsequently filed Quarterly Reports on Form 10-Q. We expressly disclaim any intent or obligation to update these forward-looking statements other than as required by law.

 

-tables follow-

 

Contacts:

Miroslava Minkova

Head of Investor Relations

Bruker Corporation

T: +1 (978) 663 — 3660, ext. 1479

E: miroslava.minkova@bruker.com

 



 

Bruker Corporation

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)

 

 

 

March 31,

 

December 31,

 

(in millions)

 

2018

 

2017

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

283.9

 

$

325.0

 

Short-term investments

 

 

114.2

 

Accounts receivable, net

 

313.6

 

319.3

 

Inventories

 

518.0

 

486.2

 

Other current assets

 

125.0

 

114.1

 

Total current assets

 

1,240.5

 

1,358.8

 

 

 

 

 

 

 

Property, plant and equipment, net

 

270.0

 

266.5

 

Intangibles, net and other long-term assets

 

320.0

 

323.2

 

 

 

 

 

 

 

Total assets

 

$

1,830.5

 

$

1,948.5

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Current portion of long-term debt

 

$

15.0

 

$

 

Accounts payable

 

104.7

 

90.8

 

Customer advances

 

125.3

 

111.7

 

Other current liabilities

 

313.7

 

322.0

 

Total current liabilities

 

558.7

 

524.5

 

 

 

 

 

 

 

Long-term debt

 

205.6

 

415.6

 

Other long-term liabilities

 

275.9

 

274.9

 

 

 

 

 

 

 

Total shareholders’ equity

 

790.3

 

733.5

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

1,830.5

 

$

1,948.5

 

 

FOR FURTHER INFORMATION:

Miroslava Minkova, Head of Investor Relations

 

Tel: +1 (978) 663-3660, ext. 1479

 

Email:  miroslava.minkova@bruker.com

 



 

Bruker Corporation

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

 

 

 

Three Months Ended

 

 

 

March 31,

 

(in millions, except per share amounts)

 

2018

 

2017

 

 

 

 

 

 

 

Revenues

 

$

431.7

 

$

384.9

 

Cost of revenues

 

232.3

 

208.5

 

 

 

 

 

 

 

Gross profit

 

199.4

 

176.4

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

Selling, general and administrative

 

110.3

 

98.1

 

Research and development

 

43.2

 

37.6

 

Other charges, net

 

7.8

 

3.1

 

Total operating expenses

 

161.3

 

138.8

 

 

 

 

 

 

 

Operating income

 

38.1

 

37.6

 

 

 

 

 

 

 

Interest and other income (expense), net

 

(2.3

)

(6.0

)

 

 

 

 

 

 

Income before income taxes and noncontrolling interest in consolidated subsidiaries

 

35.8

 

31.6

 

Income tax provision

 

8.4

 

9.9

 

 

 

 

 

 

 

Consolidated net income

 

27.4

 

21.7

 

Net income attributable to noncontrolling interests in consolidated subsidiaries

 

0.4

 

0.1

 

Net income attributable to Bruker Corporation

 

$

27.0

 

$

21.6

 

 

 

 

 

 

 

Net income per common share attributable to Bruker Corporation shareholders:

 

 

 

 

 

Basic

 

$

0.17

 

$

0.14

 

Diluted

 

$

0.17

 

$

0.13

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

Basic

 

155.9

 

159.7

 

Diluted

 

157.0

 

160.5

 

 



 

Bruker Corporation

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

 

 

 

Three Months Ended

 

 

 

March 31,

 

(in millions) 

 

2018

 

2017

 

Cash flows from operating activities:

 

 

 

 

 

Consolidated net income

 

$

27.4

 

$

21.7

 

Adjustments to reconcile consolidated net income to cash flows from operating activities:

 

 

 

 

 

Depreciation and amortization

 

15.8

 

15.1

 

Stock-based compensation expense

 

2.5

 

2.6

 

Deferred income taxes

 

(7.1

)

0.4

 

Other non-cash expenses, net

 

18.2

 

4.1

 

Changes in operating assets and liabilities, net of acquisitions and divestitures:

 

 

 

 

 

Accounts receivable

 

10.0

 

25.6

 

Inventories

 

(32.0

)

(31.1

)

Accounts payable and accrued expenses

 

(13.7

)

(2.7

)

Income taxes payable, net

 

(3.3

)

(6.4

)

Deferred revenue

 

5.9

 

0.9

 

Customer advances

 

17.8

 

(3.1

)

Other changes in operating assets and liabilities, net

 

2.3

 

5.5

 

Net cash provided by operating activities

 

43.8

 

32.6

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

Purchases of short-term investments

 

 

(85.3

)

Maturities of short-term investments

 

117.0

 

58.7

 

Cash paid for acquisitions, net of cash acquired

 

(0.4

)

(39.8

)

Purchases of property, plant and equipment

 

(8.5

)

(11.5

)

Proceeds from sales of property, plant and equipment

 

 

6.6

 

Net cash provided by (used in) investing activities

 

108.1

 

(71.3

)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

Proceeds from revolving lines of credit

 

 

33.0

 

Repayment of revolving lines of credit

 

(195.0

)

(40.0

)

Repayment of note purchase agreement

 

 

(20.0

)

Repayment of other debt, net

 

(0.1

)

(0.1

)

Proceeds from issuance of common stock, net

 

2.6

 

1.2

 

Payment of dividends

 

(6.3

)

(6.4

)

Net cash used in financing activities

 

(198.8

)

(32.3

)

Effect of exchange rate changes on cash, cash equivalents and restricted cash

 

5.8

 

5.8

 

Net change in cash, cash equivalents and restricted cash

 

(41.1

)

(65.2

)

Cash, cash equivalents and restricted cash at beginning of period

 

328.9

 

345.9

 

Cash, cash equivalents and restricted cash at end of period

 

$

287.8

 

$

280.7

 

 



 

Bruker Corporation

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (unaudited)

 

 

 

Three Months Ended March 31,

 

(in millions, except per share amounts)

 

2018

 

2017

 

Reconciliation of Non-GAAP Operating Income, Non-GAAP Profit Before Tax, Non-GAAP Net Income, and Non-GAAP EPS

 

 

 

 

 

 

 

 

 

 

 

GAAP Operating Income

 

$

38.1

 

$

37.6

 

Non-GAAP Adjustments:

 

 

 

 

 

Restructuring Costs

 

3.5

 

0.1

 

Acquisition-Related Costs

 

1.0

 

2.8

 

Purchased Intangible Amortization

 

6.8

 

6.9

 

Other Costs

 

3.5

 

1.8

 

Total Non-GAAP Adjustments:

 

$

14.8

 

$

11.6

 

 

 

 

 

 

 

Non-GAAP Operating Income

 

$

52.9

 

$

49.2

 

Non-GAAP Operating Margin

 

12.3

%

12.8

%

 

 

 

 

 

 

Non-GAAP Interest & Other Expense, net

 

(2.3

)

(6.0

)

Non-GAAP Profit Before Tax

 

50.6

 

43.2

 

 

 

 

 

 

 

Non-GAAP Income Tax Provision

 

(12.0

)

(13.2

)

Non-GAAP Tax Rate

 

23.7

%

30.6

%

 

 

 

 

 

 

Minority Interest

 

(0.4

)

(0.1

)

 

 

 

 

 

 

Non-GAAP Net Income Attributable to Bruker

 

38.2

 

29.9

 

 

 

 

 

 

 

Weighted Average Shares Outstanding (Diluted)

 

157.0

 

160.5

 

 

 

 

 

 

 

Non-GAAP Earnings Per Share

 

$

0.24

 

$

0.19

 

 

 

 

 

 

 

Reconciliation of GAAP and Non-GAAP Gross Profit

 

 

 

 

 

GAAP Gross Profit

 

$

199.4

 

$

176.4

 

Non-GAAP Adjustments:

 

 

 

 

 

Restructuring Costs

 

0.2

 

(1.4

)

Acquisition-Related Costs

 

 

2.5

 

Purchased Intangible Amortization

 

5.4

 

5.4

 

Other Costs

 

 

0.5

 

Total Non-GAAP Adjustments:

 

5.6

 

7.0

 

Non-GAAP Gross Profit

 

$

205.0

 

$

183.4

 

Non-GAAP Gross Margin

 

47.5

%

47.6

%

 

 

 

 

 

 

Reconciliation of GAAP and Non-GAAP Tax Rate

 

 

 

 

 

GAAP Tax Rate

 

23.5

%

31.3

%

Non-GAAP Adjustments:

 

 

 

 

 

Tax Impact of Non-GAAP Adjustments

 

-0.3

%

0.6

%

Tax Authority Settlements

 

0.0

%

0.3

%

Other Discrete Items

 

0.5

%

-1.6

%

Total Non-GAAP Adjustments:

 

0.2

%

-0.7

%

Non-GAAP Tax Rate

 

23.7

%

30.6

%

 

 

 

 

 

 

Reconciliation of GAAP and Non-GAAP Earnings Per Share (Diluted)

 

 

 

 

 

GAAP Earnings Per Share (Diluted)

 

$

0.17

 

$

0.13

 

Non-GAAP Adjustments:

 

 

 

 

 

Restructuring Costs

 

0.02

 

 

Acquisition-Related Costs

 

0.01

 

0.02

 

Purchased Intangible Amortization

 

0.04

 

0.04

 

Other Costs

 

0.02

 

0.02

 

Bargain Purchase Gain

 

 

 

Income Tax Rate Differential

 

(0.02

)

(0.02

)

Total Non-GAAP Adjustments:

 

0.07

 

0.06

 

Non-GAAP Earnings Per Share (Diluted)

 

$

0.24

 

$

0.19

 

 

 

 

 

 

 

Reconciliation of GAAP Operating Cash Flow and Non-GAAP Free Cash Flow

 

 

 

 

 

GAAP Operating Cash Flow

 

$

43.8

 

$

32.6

 

Non-GAAP Adjustments:

 

 

 

 

 

Purchases of property, plant and equipment

 

(8.5

)

(11.5

)

Non-GAAP Free Cash Flow

 

$

35.3

 

$

21.1

 

 



 

Bruker Corporation

REVENUE (unaudited)

 

 

 

Three Months Ended March 31,

 

(in millions)

 

2018

 

2017

 

Revenue by Group:

 

 

 

 

 

Bruker BioSpin

 

$

131.8

 

$

125.2

 

Bruker CALID

 

131.3

 

110.5

 

Bruker Nano

 

123.9

 

110.7

 

BEST

 

45.6

 

40.1

 

Eliminations

 

(0.9

)

(1.6

)

Total Revenue

 

$

431.7

 

$

384.9

 

 

 

 

 

 

 

Revenue by End Customer Geography:

 

 

 

 

 

United States

 

$

104.8

 

$

96.1

 

Europe

 

161.4

 

130.0

 

Asia Pacific

 

126.9

 

125.6

 

Other

 

38.6

 

33.2

 

Total Revenue

 

$

431.7

 

$

384.9

 

 

 

 

 

 

 

Reconciliation of GAAP Reported Revenue Growth to Organic Revenue Growth

 

 

 

 

 

GAAP Revenue as of Prior Comparable Period

 

$

384.9

 

$

375.4

 

Non-GAAP Adjustments:

 

 

 

 

 

Acquisitions and divestitures

 

2.0

 

19.7

 

Currency

 

29.5

 

(7.3

)

Organic

 

15.3

 

(2.9

)

Total Non-GAAP Adjustments:

 

46.8

 

9.5

 

Non-GAAP Revenue

 

$

431.7

 

$

384.9

 

Organic Revenue Growth

 

4.0

%

-0.8

%

 

The Company adopted Accounting Standards Codification (ASC) 606 as of January 1, 2018 under the modified retrospective approach.  Accordingly, the 2017 revenue amounts have not been restated to reflect ASC 606 and are presented for informational purposes only. The adoption of ASC 606 was not material for the period ended March 31, 2018.