BEDFORD, Mass., July 29, 2015 /PRNewswire/ -- Hologic, Inc.
(NASDAQ: HOLX) announced today the Company's financial results for
the fiscal third quarter ended June
27, 2015. Quarterly revenues of $693.9 million increased 9.7% on a reported
basis, and 12.2% on a constant currency basis. GAAP earnings
per share (EPS) of $0.10 increased
150%, while non-GAAP EPS of $0.43
increased 16.2%.
"Our third quarter financial results demonstrate the significant
progress we have made in building a company that can grow
sustainably on both the top and bottom lines," said Steve MacMillan, Hologic's Chairman, President
and Chief Executive Officer. "Growth was led by accelerated
adoption of our Genius 3D mammography systems, but our diagnostics
and surgical businesses also showed broad-based strength.
While we are proud of our accomplishments to date, we also believe
we have multiple growth opportunities still ahead of us."
Key financial results for the fiscal third quarter are shown
below. Throughout this press release, all dollar figures are
in millions, except EPS. Unless otherwise noted, all results
are on a reported basis, and are compared to the prior year
period.
|
GAAP
|
|
Non-GAAP
|
|
Q3'15
|
Q3'14
|
Change
(Reported)
|
|
Q3'15
|
Q3'14
|
Change
(Reported)
|
Revenues
|
$693.9
|
$632.6
|
9.7%
|
|
$693.9
|
$632.6
|
9.7%
|
Gross
Margin
|
54.6%
|
49.4%
|
520 bps
|
|
65.2%
|
62.9%
|
230 bps
|
Operating
Expenses
|
$262.7
|
$236.6
|
11.0%
|
|
$222.4
|
$198.2
|
12.2%
|
Operating
Margin
|
16.7%
|
12.0%
|
470 bps
|
|
33.2%
|
31.5%
|
170 bps
|
Net Income
|
$29.4
|
$11.3
|
160.2%
|
|
$126.9
|
$102.4
|
24.0%
|
Diluted
EPS
|
$0.10
|
$0.04
|
150.0%
|
|
$0.43
|
$0.37
|
16.2%
|
Revenue Detail
Revenues increased 12.2% on a constant currency basis, and grew
in three of four business segments globally:
$s in
millions
|
Q3'15
|
Q3'14
|
Change
(Reported)
|
Change
(Constant
Currency)
|
Diagnostics
|
$306.9
|
$293.1
|
4.7%
|
7.0%
|
Breast
Health
|
$279.5
|
$238.0
|
17.5%
|
20.2%
|
GYN
Surgical
|
$85.5
|
$78.5
|
8.9%
|
11.0%
|
Skeletal
Health
|
$22.0
|
$23.0
|
(4.7%)
|
(1.4%)
|
Total
|
$693.9
|
$632.6
|
9.7%
|
12.2%
|
Other revenue highlights include:
- On a constant currency basis, revenues grew at double-digit
rates both domestically and internationally. U.S. revenues of
$539.7 million increased 12.7%.
International revenues of $154.2
million increased 0.4% on a reported basis, and 10.3% on a
constant currency basis.
- In Breast Health, revenue from breast imaging products and
service totaled $234.1 million, an
increase of 21.5% on a reported basis and 24.2% on a constant
currency basis, as customer adoption of Hologic's Genius 3D
mammography systems accelerated.
- In Diagnostics:
- Molecular diagnostics sales of $124.6
million increased 7.2% on a reported basis, and 8.9% on a
constant currency basis, driven mainly by continued strength in
Aptima women's health products on the fully automated Panther and
Tigris platforms. Notably, U.S. molecular diagnostics sales
grew 12.6%.
- Cytology and perinatal sales of $118.1
million decreased (3.8%) on a reported basis, but increased
0.2% on a constant currency basis, as declines in domestic ThinPrep
sales continued to moderate.
- Blood screening revenue from Hologic's partner Grifols totaled
$64.2 million, an increase of 18.5%,
primarily due to new business with the Japanese Red Cross. As
previously discussed, this growth benefit will annualize in
Hologic's fiscal fourth quarter.
- In GYN Surgical, MyoSure system sales of $31.5 million increased 36.1% on a reported basis
and 37.5% on a constant currency basis. NovaSure system sales
of $53.6 million declined (2.4%) on a
reported basis, and were flat on a constant currency basis.
- Approximately 61% of total revenues were from disposables, 23%
were from capital equipment, and 16% were from service and other
sources.
Expense Detail
Gross margin was 54.6% on a GAAP basis, and 65.2% on a non-GAAP
basis. Gross margin improved mainly due to strong domestic
sales growth, and favorable product mix in the Breast Health and
Diagnostics divisions. These benefits were partially offset
by a stronger U.S. dollar.
Operating expenses were $262.7
million on a GAAP basis, and $222.4
million on a non-GAAP basis. Operating expenses
increased mainly due to higher variable compensation expense, and
increased marketing and research and development spending in the
Breast Health and Diagnostics businesses.
Other Key Financial Results
Adjusted non-GAAP earnings before interest, taxes, depreciation
and amortization (EBITDA) were $249.7
million, an increase of 12.6%.
Operating cash flow was $242.3
million, an increase of 53.0%, driven by higher net income
and working capital efficiencies. Free cash flow, defined as
operating cash flow less capital expenditures, was $223.9 million.
Total debt outstanding at the end of the fiscal third quarter
was $3,942.3 million, a decrease of
$328.2 million compared to the prior
year period. During the quarter, the Company entered into a
new, five-year secured credit agreement consisting of a
$1.5 billion senior Term Loan and a
$1 billion revolving credit facility,
and used the proceeds to pay off the Company's previous senior
secured term loans. In addition, on July 2 the Company completed a private offering
of $1.0 billion aggregate principal
amount of 5.250% senior notes due 2022 at an issue price of
$1,000 per $1,000. Hologic intends to use the net
proceeds of the offering, plus available cash, to redeem its
outstanding 6.25% senior notes due 2020 in the aggregate principal
amount of $1.0 billion.
Return on invested capital was 10.6% on a trailing 12 months
basis, compared to 8.3% in the prior year period.
The Company ended the quarter with cash, cash equivalents and
restricted cash of $888.8
million.
Updated Financial Guidance
Based on its strong performance in the third quarter of fiscal
2015, Hologic is raising its full year 2015 revenue and non-GAAP
EPS guidance, as shown in the table below. The guidance for
reported results is based on recent foreign exchange rates.
Guidance assumes diluted shares outstanding of 291 million for the
full year and an annual tax rate of 34.25%. Percentage
changes from the prior year exclude the one-time benefit associated
with amending the Roka license agreement, which added $20.1 million of revenue and $0.05 of EPS to the fourth quarter of fiscal
2014.
|
New
Guidance
|
Last
Guidance
From
4/29/15
|
New Guidance vs.
Prior
Year
(As
Reported)
|
New Guidance vs.
Prior Year
(Constant
Currency)
|
Revenues
|
$2,687 to
$2,697
million
|
$2,600 to
$2,620
million
|
7.0% to
7.4%
|
9.1% to
9.5%
|
Non-GAAP
EPS
|
$1.65 to
$1.66
|
$1.57 to
$1.59
|
13.0% to
13.7%
|
17.1% to
17.8%
|
For the fourth quarter of fiscal 2015, Hologic now expects:
|
Guidance
|
Change vs. Prior
Year
Period (As
Reported)
|
Change vs. Prior Year
Period
(Constant
Currency)
|
Revenues
|
$685 to $695
million
|
6.9% to
8.5%
|
9.3% to
10.9%
|
Non-GAAP
EPS
|
$0.41 to
$0.42
|
7.9% to
10.5%
|
13.2% to
15.8%
|
Use of Non-GAAP Financial Measures
The Company has presented the following non-GAAP financial
measures in this press release: constant currency revenues;
non-GAAP gross margin; non-GAAP operating expenses; non-GAAP
operating margin; non-GAAP net income; non-GAAP EPS; and adjusted
EBITDA. The Company defines its non-GAAP net income, EPS, and other
non-GAAP financial measures to exclude, as applicable: (i) the
amortization of intangible assets and impairment of goodwill and
intangible assets; (ii) acquisition-related charges and effects,
such as charges for contingent consideration, transaction costs,
integration costs including retention, and credits and/or charges
associated with the write-up of acquired inventory and fixed assets
to fair value; (iii) non-cash interest expense related to
amortization of the debt discount from the equity conversion option
of the convertible notes; (iv) restructuring and divestiture
charges and accelerated depreciation expense; (v) debt
extinguishment losses and related transaction costs; (vi)
litigation settlement charges (benefits); (vii)
other-than-temporary impairment losses on investments; (viii) other
one-time, non-recurring, unusual or infrequent charges, expenses or
gains that may not be indicative of the Company's core business
results; and (ix) income taxes related to such adjustments.
The Company defines adjusted EBITDA as its non-GAAP net income plus
net interest expense, income taxes, and depreciation and
amortization expense included in its non-GAAP net income.
The Company believes the use of non-GAAP financial measures is
useful to investors by eliminating certain of the more significant
effects of its acquisitions and related activities, non-cash
charges resulting from the application of GAAP to convertible debt
instruments with cash settlement features, charges related to debt
extinguishment losses, investment impairments, litigation
settlements, and restructuring and divestiture initiatives. These
non-GAAP measures also reflect how Hologic manages its businesses
internally. In addition to the adjustments set forth in the
calculation of the Company's non-GAAP net income and EPS, its
adjusted EBITDA eliminates the effects of financing, income taxes
and the accounting effects of capital spending. As with the items
eliminated in its calculation of non-GAAP net income, these items
may vary for different companies for reasons unrelated to the
overall operating performance of a company's business. When
analyzing the Company's operating performance, investors should not
consider these non-GAAP financial measures as a substitute for net
income prepared in accordance with GAAP.
Future Non-GAAP Adjustments
Future GAAP EPS may be affected by changes in ongoing
assumptions and judgments, and may also be affected by
non-recurring, unusual or unanticipated charges, expenses or gains,
which are excluded in the calculation of the Company's non-GAAP EPS
guidance as described in this press release. It is therefore not
practicable to reconcile non-GAAP EPS guidance to the most
comparable GAAP measure.
Conference Call and Webcast
Hologic's management will host a conference call at 4:30 p.m. ET today to discuss its financial
results for the third quarter of fiscal 2015. Approximately
10 minutes before the call, dial 877-723-9509 (U.S. and
Canada) or 719-325-4804
(international) and enter access code 3002395. A replay will
be available starting two hours after the call ends through
August 28, 2015, at 888-203-1112
(U.S. and Canada) or 719-457-0820
(international), access code 3002395. The Company will also
provide a live webcast of the call at
www.investors.hologic.com/investors-overview. A PowerPoint
presentation related to the conference call will be posted to the
same site.
About Hologic, Inc.
Hologic, Inc. is a leading developer, manufacturer and supplier
of premium diagnostic products, medical imaging systems and
surgical products. The Company's core business units focus on
diagnostics, breast health, GYN surgical, and skeletal
health. With a unified suite of technologies and a robust
research and development program, Hologic is dedicated to The
Science of Sure. For more information on Hologic, visit
www.hologic.com.
Hologic, Genius 3D mammography, Aptima, ThinPrep, MyoSure,
NovaSure, Panther, Tigris, The Science of Sure, and associated
logos are trademarks and/or registered trademarks of Hologic, Inc.
and/or its subsidiaries in the United
States and/or other countries.
Forward-Looking Statements
This News Release contains forward-looking information that
involves risks and uncertainties, including statements about the
Company's plans, objectives, expectations and intentions. Such
statements include, without limitation: financial or other
information included herein based upon or otherwise incorporating
judgments or estimates relating to future performance, events or
expectations; the Company's strategies, positioning, resources,
capabilities, and expectations for future performance; and the
Company's outlook and financial and other guidance. These
forward-looking statements are based upon assumptions made by the
Company as of the date hereof and are subject to known and unknown
risks and uncertainties that could cause actual results to differ
materially from those anticipated.
Risks and uncertainties that could adversely affect the
Company's business and prospects, and otherwise cause actual
results to differ materially from those anticipated, include
without limitation: the ability of the Company to successfully
manage leadership and organizational changes, including the ability
of the Company to attract, motivate and retain key employees; U.S.,
European and general worldwide economic conditions and related
uncertainties; the Company's reliance on third-party reimbursement
policies to support the sales and market acceptance of its
products, including the possible adverse impact of government
regulation and changes in the availability and amount of
reimbursement and uncertainties for new products or product
enhancements; uncertainties regarding healthcare reform
legislation, including associated tax provisions, or budget
reduction or other cost containment efforts; changes in guidelines,
recommendations and studies published by various organizations that
could affect the use of the Company's products; uncertainties
inherent in the development of new products and the enhancement of
existing products, including FDA approval and/or clearance and
other regulatory risks, technical risks, cost overruns and delays;
the risk that products may contain undetected errors or defects or
otherwise not perform as anticipated; risks associated with
strategic alliances and the ability of the Company to realize
anticipated benefits of those alliances; risks associated with
acquisitions, including, without limitation, the Company's ability
to successfully integrate acquired businesses, the risks that the
acquired businesses may not operate as effectively and efficiently
as expected even if otherwise successfully integrated, and the
risks that acquisitions may involve unexpected costs or unexpected
liabilities; the risks of conducting business internationally; the
risk of adverse exchange rate fluctuations on the Company's
international activities and businesses; manufacturing risks,
including the Company's reliance on a single or limited source of
supply for key components, and the need to comply with especially
high standards for the manufacture of many of its products; the
Company's ability to predict accurately the demand for its
products, and products under development, and to develop strategies
to address its markets successfully; the early stage of market
development for certain of the Company's products; the Company's
leverage risks, including the Company's obligation to meet payment
obligations and financial covenants associated with its debt; risks
related to the use and protection of intellectual property;
expenses, uncertainties and potential liabilities relating to
litigation, including, without limitation, commercial, intellectual
property, employment and product liability litigation; technical
innovations that could render products marketed or under
development by the Company obsolete; and competition.
The risks included above are not exhaustive. Other factors that
could adversely affect the Company's business and prospects are
described in the filings made by the Company with the SEC. The
Company expressly disclaims any obligation or undertaking to
release publicly any updates or revisions to any such statements
presented herein to reflect any change in expectations or any
change in events, conditions or circumstances on which any such
statements are based.
Contact
Michael
Watts
Vice President, Investor Relations and Corporate Communications
(858) 410-8588
HOLOGIC,
INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(Unaudited)
|
(In millions, except
number of shares, which are reflected in thousands, and per share
data)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
June 27,
2015
|
|
June 28,
2014
|
|
June 27,
2015
|
|
June 28,
2014
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
Product
|
$
|
583.0
|
|
|
$
|
529.3
|
|
|
$
|
1,676.0
|
|
|
$
|
1,562.8
|
|
Service and
other
|
110.9
|
|
|
103.3
|
|
|
326.2
|
|
|
307.3
|
|
Total
revenues
|
693.9
|
|
|
632.6
|
|
|
2,002.2
|
|
|
1,870.1
|
|
|
|
|
|
|
|
|
|
Cost of
revenues:
|
|
|
|
|
|
|
|
Product
|
186.2
|
|
|
186.7
|
|
|
559.6
|
|
|
549.3
|
|
Amortization of
intangible assets
|
73.1
|
|
|
80.5
|
|
|
225.6
|
|
|
234.1
|
|
Impairment of
intangible assets
|
—
|
|
|
—
|
|
|
—
|
|
|
26.6
|
|
Service and
other
|
55.9
|
|
|
52.6
|
|
|
163.7
|
|
|
159.6
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
378.7
|
|
|
312.8
|
|
|
1,053.3
|
|
|
900.5
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Research and
development
|
56.0
|
|
|
52.5
|
|
|
161.2
|
|
|
151.1
|
|
Selling and
marketing
|
94.3
|
|
|
83.0
|
|
|
263.3
|
|
|
245.0
|
|
General and
administrative
|
73.1
|
|
|
64.7
|
|
|
194.7
|
|
|
194.6
|
|
Amortization of
intangible assets
|
27.4
|
|
|
29.7
|
|
|
82.8
|
|
|
85.0
|
|
Impairment of
intangible assets
|
—
|
|
|
—
|
|
|
—
|
|
|
0.5
|
|
Restructuring and
divestiture charges
|
11.9
|
|
|
6.7
|
|
|
21.9
|
|
|
36.6
|
|
Total operating
expenses
|
262.7
|
|
|
236.6
|
|
|
723.9
|
|
|
712.8
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
116.0
|
|
|
76.2
|
|
|
329.4
|
|
|
187.7
|
|
Interest
expense
|
(52.4)
|
|
|
(52.4)
|
|
|
(154.3)
|
|
|
(168.1)
|
|
Other income
(expense), net
|
1.3
|
|
|
(1.2)
|
|
|
1.6
|
|
|
(2.7)
|
|
Debt extinguishment
loss
|
(18.2)
|
|
|
—
|
|
|
(24.9)
|
|
|
(7.4)
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
46.7
|
|
|
22.6
|
|
|
151.8
|
|
|
9.5
|
|
Provision for income
taxes
|
17.3
|
|
|
11.3
|
|
|
45.3
|
|
|
20.3
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
29.4
|
|
|
$
|
11.3
|
|
|
$
|
106.5
|
|
|
$
|
(10.8)
|
|
|
|
|
|
|
|
|
|
Net income (loss)
per common share:
|
|
|
|
|
|
|
|
Basic
|
$
|
0.10
|
|
|
$
|
0.04
|
|
|
$
|
0.38
|
|
|
$
|
(0.04)
|
|
Diluted
|
$
|
0.10
|
|
|
$
|
0.04
|
|
|
$
|
0.37
|
|
|
$
|
(0.04)
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
281,184
|
|
|
276,843
|
|
|
280,064
|
|
|
274,713
|
|
Diluted
|
292,612
|
|
|
279,205
|
|
|
287,790
|
|
|
274,713
|
|
HOLOGIC,
INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(Unaudited)
|
(In
millions)
|
|
|
|
|
|
|
June 27,
2015
|
|
September 27,
2014
|
ASSETS
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
885.0
|
|
|
$
|
736.1
|
|
Restricted
cash
|
3.8
|
|
|
5.5
|
|
Accounts receivable,
net
|
382.8
|
|
|
396.0
|
|
Inventories
|
295.0
|
|
|
330.6
|
|
Deferred income
taxes
|
—
|
|
|
39.4
|
|
Other current
assets
|
62.2
|
|
|
58.2
|
|
Total current
assets
|
1,628.8
|
|
|
1,565.8
|
|
|
|
|
|
Property, plant and
equipment, net
|
449.9
|
|
|
461.9
|
|
Goodwill and
intangible assets
|
5,934.4
|
|
|
6,244.4
|
|
Other
assets
|
117.4
|
|
|
142.6
|
|
Total
assets
|
$
|
8,130.5
|
|
|
$
|
8,414.7
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
Current portion of
long-term debt
|
$
|
671.5
|
|
|
$
|
114.5
|
|
Accounts payable and
accrued liabilities
|
349.4
|
|
|
354.2
|
|
Deferred income tax
liabilities
|
16.1
|
|
|
—
|
|
Deferred
revenue
|
152.2
|
|
|
150.9
|
|
Total current
liabilities
|
1,189.2
|
|
|
619.6
|
|
|
|
|
|
Long-term debt, net
of current portion
|
3,270.8
|
|
|
4,153.2
|
|
Deferred income
taxes
|
1,209.7
|
|
|
1,375.4
|
|
Other long-term
liabilities
|
223.7
|
|
|
203.5
|
|
Total
liabilities
|
5,893.4
|
|
|
6,351.7
|
|
Total stockholders'
equity
|
2,237.1
|
|
|
2,063.0
|
|
Total liabilities
and stockholders' equity
|
$
|
8,130.5
|
|
|
$
|
8,414.7
|
|
HOLOGIC,
INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
(Unaudited)
|
(In
millions)
|
|
|
|
|
|
Nine Months
Ended
|
|
June 27,
2015
|
|
June 28,
2014
|
OPERATING
ACTIVITIES
|
|
|
|
Net income
(loss)
|
$
|
106.5
|
|
|
$
|
(10.8)
|
|
Adjustments to
reconcile net income (loss) to net cash provided by operating
activities:
|
|
|
|
Depreciation
|
60.8
|
|
|
72.7
|
|
Amortization
|
308.3
|
|
|
319.1
|
|
Non-cash interest
expense
|
49.5
|
|
|
52.2
|
|
Stock-based
compensation expense
|
42.2
|
|
|
39.1
|
|
Excess tax benefit
related to equity awards
|
(8.0)
|
|
|
(5.2)
|
|
Deferred income
taxes
|
(110.9)
|
|
|
(204.6)
|
|
Asset impairment
charges
|
—
|
|
|
33.3
|
|
Cost-method equity
investment impairment charges
|
—
|
|
|
6.9
|
|
Debt extinguishment
loss
|
24.9
|
|
|
7.4
|
|
Loss on disposal of
business
|
9.6
|
|
|
—
|
|
Loss on disposal of
property and equipment
|
4.5
|
|
|
5.1
|
|
Other
|
0.5
|
|
|
(1.4)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
Accounts
receivable
|
3.5
|
|
|
28.4
|
|
Inventories
|
32.9
|
|
|
(42.2)
|
|
Prepaid income
taxes
|
(1.3)
|
|
|
34.4
|
|
Prepaid expenses and
other assets
|
4.7
|
|
|
13.8
|
|
Accounts
payable
|
(1.8)
|
|
|
1.7
|
|
Accrued expenses and
other liabilities
|
25.3
|
|
|
16.1
|
|
Deferred
revenue
|
2.4
|
|
|
10.7
|
|
Net cash provided by
operating activities
|
553.6
|
|
|
376.7
|
|
INVESTING
ACTIVITIES
|
|
|
|
Net proceeds from
sale of business
|
—
|
|
|
2.4
|
|
Purchase of property
and equipment
|
(27.9)
|
|
|
(30.9)
|
|
Increase in equipment
under customer usage agreements
|
(30.2)
|
|
|
(26.9)
|
|
Net (purchases) sales
of insurance contracts
|
(6.4)
|
|
|
13.8
|
|
Purchases of mutual
funds
|
—
|
|
|
(29.7)
|
|
Sales of mutual
funds
|
7.7
|
|
|
22.4
|
|
Increase in other
assets
|
—
|
|
|
(3.0)
|
|
Net cash used in
investing activities
|
(56.8)
|
|
|
(51.9)
|
|
FINANCING
ACTIVITIES
|
|
|
|
Repayment of
long-term debt
|
(2,045.0)
|
|
|
(578.8)
|
|
Proceeds from
long-term debt
|
1,495.1
|
|
|
—
|
|
Proceeds from
revolving credit line
|
175.0
|
|
|
—
|
|
Payment of debt
issuance costs
|
(8.3)
|
|
|
(2.4)
|
|
Purchase of interest
rate caps
|
(6.1)
|
|
|
—
|
|
Payment of deferred
acquisition consideration
|
—
|
|
|
(5.0)
|
|
Net proceeds from
issuance of common stock pursuant to employee stock
plans
|
50.4
|
|
|
75.8
|
|
Excess tax benefit
related to equity awards
|
8.0
|
|
|
5.2
|
|
Payment of minimum
tax withholdings on net share settlements of equity
awards
|
(12.6)
|
|
|
(9.2)
|
|
Net cash used in
financing activities
|
(343.5)
|
|
|
(514.4)
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
(4.4)
|
|
|
(0.4)
|
|
Net increase
(decrease) in cash and cash equivalents
|
148.9
|
|
|
(190.0)
|
|
Cash and cash
equivalents, beginning of period
|
736.1
|
|
|
822.5
|
|
Cash and cash
equivalents, end of period
|
$
|
885.0
|
|
|
$
|
632.5
|
|
HOLOGIC,
INC.
|
RECONCILIATION OF
GAAP TO NON-GAAP RESULTS
|
|
(Unaudited)
|
(In millions, except
earnings per share)
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
June 27,
2015
|
|
June 28,
2014
|
|
June 27,
2015
|
|
June 28,
2014
|
|
|
|
|
|
|
|
|
Gross
Profit:
|
|
|
|
|
|
|
|
GAAP gross
profit
|
$
|
378.7
|
|
|
$
|
312.8
|
|
|
$
|
1,053.3
|
|
|
$
|
900.5
|
|
Adjustments:
|
|
|
|
|
|
|
|
Amortization of
intangible assets (1)
|
73.1
|
|
|
80.5
|
|
|
225.6
|
|
|
234.1
|
|
Incremental
depreciation expense (2)
|
0.8
|
|
|
1.7
|
|
|
2.4
|
|
|
5.2
|
|
Acquisition and
integration- related costs (3)
|
0.1
|
|
|
2.0
|
|
|
0.5
|
|
|
7.7
|
|
Impairment charges
(4)
|
—
|
|
|
1.0
|
|
|
—
|
|
|
28.5
|
|
Non-GAAP gross
profit
|
$
|
452.7
|
|
|
$
|
398.0
|
|
|
$
|
1,281.8
|
|
|
$
|
1,176.0
|
|
|
|
|
|
|
|
|
|
Gross Margin
Percentage:
|
|
|
|
|
|
|
|
GAAP gross margin
percentage
|
54.6
|
%
|
|
49.4
|
%
|
|
52.6
|
%
|
|
48.2
|
%
|
Impact of adjustments
above
|
10.6
|
%
|
|
13.5
|
%
|
|
11.4
|
%
|
|
14.7
|
%
|
Non-GAAP gross margin
percentage
|
65.2
|
%
|
|
62.9
|
%
|
|
64.0
|
%
|
|
62.9
|
%
|
|
|
|
|
|
|
|
|
Operating
Expenses:
|
|
|
|
|
|
|
|
GAAP operating
expenses
|
$
|
262.7
|
|
|
$
|
236.6
|
|
|
$
|
723.9
|
|
|
$
|
712.8
|
|
Adjustments:
|
|
|
|
|
|
|
|
Amortization of
intangible assets (1)
|
(27.4)
|
|
|
(29.7)
|
|
|
(82.8)
|
|
|
(85.0)
|
|
Incremental
depreciation expense (2)
|
(1.0)
|
|
|
(1.3)
|
|
|
(2.3)
|
|
|
(4.0)
|
|
Acquisition and
integration- related costs (3)
|
—
|
|
|
(0.7)
|
|
|
—
|
|
|
(4.1)
|
|
Restructuring and
divestiture charges (3)
|
(11.9)
|
|
|
(6.7)
|
|
|
(21.9)
|
|
|
(36.6)
|
|
Impairment charges
(4)
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.8)
|
|
Other (5)
|
—
|
|
|
—
|
|
|
(0.1)
|
|
|
0.9
|
|
Non-GAAP operating
expenses
|
$
|
222.4
|
|
|
$
|
198.2
|
|
|
$
|
616.8
|
|
|
$
|
582.2
|
|
|
|
|
|
|
|
|
|
Operating
Margin:
|
|
|
|
|
|
|
|
GAAP income from
operations
|
116.0
|
|
|
76.2
|
|
|
329.4
|
|
|
187.7
|
|
Adjustments to gross
profit as detailed above
|
74.0
|
|
|
85.2
|
|
|
228.5
|
|
|
275.5
|
|
Adjustments to
operating expenses as detailed above
|
40.3
|
|
|
|
38.4
|
|
|
107.1
|
|
|
130.6
|
|
Non-GAAP income from
operations
|
$
|
230.3
|
|
|
$
|
199.8
|
|
|
$
|
665.0
|
|
|
$
|
593.8
|
|
|
|
|
|
|
|
|
|
Operating Margin
Percentage:
|
|
|
|
|
|
|
|
GAAP income from
operations margin percentage
|
16.7
|
%
|
|
12.0
|
%
|
|
16.5
|
%
|
|
10.0
|
%
|
Impact of adjustments
above
|
16.5
|
%
|
|
19.5
|
%
|
|
16.7
|
%
|
|
21.8
|
%
|
Non-GAAP operating
margin percentage
|
33.2
|
%
|
|
31.5
|
%
|
|
33.2
|
%
|
|
31.8
|
%
|
|
|
|
|
|
|
|
|
|
|
Interest
Expense:
|
|
GAAP interest
expense
|
52.4
|
|
|
52.4
|
|
|
154.3
|
|
|
168.1
|
|
Adjustments:
|
|
|
|
|
|
|
|
Non-cash interest
expense relating to convertible notes (6)
|
(9.2)
|
|
|
(8.5)
|
|
|
(27.0)
|
|
|
(28.4)
|
|
Debt transaction
costs (7)
|
(4.6)
|
|
|
—
|
|
|
(4.6)
|
|
|
(1.0)
|
|
Non-GAAP interest
expense
|
38.6
|
|
|
43.9
|
|
|
122.7
|
|
|
138.7
|
|
|
|
|
|
|
|
|
|
Pre-Tax Income
(loss):
|
|
|
|
|
|
|
|
GAAP pre-tax earnings
(loss)
|
46.7
|
|
|
22.6
|
|
|
151.8
|
|
|
9.5
|
|
Adjustments to
pre-tax earnings (loss) as detailed above
|
128.1
|
|
|
132.3
|
|
|
367.2
|
|
|
435.5
|
|
Debt extinguishment
loss (7)
|
18.2
|
|
|
—
|
|
|
24.9
|
|
|
7.4
|
|
Other (5)
|
—
|
|
|
3.2
|
|
|
—
|
|
|
6.9
|
|
Non-GAAP pre-tax
Income
|
193.0
|
|
|
158.1
|
|
|
543.9
|
|
|
459.3
|
|
Net income
(loss):
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
$
|
29.4
|
|
|
$
|
11.3
|
|
|
$
|
106.5
|
|
|
$
|
(10.8)
|
|
Adjustments:
|
|
|
|
|
|
|
|
Amortization of
intangible assets (1)
|
100.5
|
|
|
110.2
|
|
|
308.4
|
|
|
319.1
|
|
Non-cash interest
expense relating to convertible notes (6)
|
9.2
|
|
|
8.5
|
|
|
27.0
|
|
|
28.4
|
|
Restructuring,
divestiture and acquisition- related charges (3)
|
12.0
|
|
|
9.4
|
|
|
22.4
|
|
|
48.4
|
|
Incremental
depreciation expenses (2)
|
1.8
|
|
|
3.0
|
|
|
4.7
|
|
|
9.2
|
|
Debt extinguishment
loss and transaction charges
(7)
|
22.8
|
|
|
—
|
|
|
29.5
|
|
|
8.4
|
|
Asset impairment
charges (4)
|
—
|
|
|
—
|
|
|
—
|
|
|
30.3
|
|
Other charges
(5)
|
—
|
|
|
4.2
|
|
|
0.1
|
|
|
6.0
|
|
Income tax effect of
reconciling items (8)
|
(48.8)
|
|
|
(44.2)
|
|
|
(141.1)
|
|
|
(139.3)
|
|
Non-GAAP net
income
|
$
|
126.9
|
|
|
$
|
102.4
|
|
|
$
|
357.5
|
|
|
$
|
299.7
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
per share:
|
|
|
|
|
|
|
|
GAAP earnings (loss)
per share - Diluted
|
$
|
0.10
|
|
|
$
|
0.04
|
|
|
$
|
0.37
|
|
|
$
|
(0.04)
|
|
Adjustment to net
earnings (loss) (as detailed below)
|
0.33
|
|
|
0.33
|
|
|
0.87
|
|
|
1.12
|
|
Non-GAAP earnings per
share – diluted (9)
|
$
|
0.43
|
|
|
$
|
0.37
|
|
|
$
|
1.24
|
|
|
$
|
1.08
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA:
|
|
|
|
|
|
|
|
Non-GAAP net
income
|
$
|
126.9
|
|
|
$
|
102.4
|
|
|
$
|
357.5
|
|
|
$
|
299.7
|
|
Interest expense,
net, not adjusted above
|
38.4
|
|
|
43.6
|
|
|
121.7
|
|
|
137.9
|
|
Provision for income
taxes
|
66.1
|
|
|
55.7
|
|
|
186.2
|
|
|
159.6
|
|
Depreciation expense,
not adjusted above
|
18.3
|
|
|
20.0
|
|
|
55.9
|
|
|
60.4
|
|
Adjusted
EBITDA
|
$
|
249.7
|
|
|
$
|
221.7
|
|
|
$
|
721.3
|
|
|
$
|
657.6
|
|
Explanatory Notes to Reconciliations:
(1)
|
To reflect non-cash
expenses attributable to the amortization of intangible
assets.
|
(2)
|
To reflect non-cash
fair value adjustments for additional depreciation expense related
to the fair value write-up of fixed assets acquired in the
Gen-Probe acquisition and accelerated depreciation expense related
to facility closure and consolidation.
|
(3)
|
To reflect
restructuring and divestiture charges and certain costs associated
with the Company's acquisition(s) and integration plans, which
primarily include retention and transfer costs.
|
(4)
|
To reflect a non-cash
impairment charge on certain of the Company's intangible assets and
property and equipment related to its MRI breast coils product line
to record them at fair value in fiscal 2014 and the impairments for
inventory and equipment due to cost containment and consolidation
plans.
|
(5)
|
To reflect the net
impact from miscellaneous transactions during the relevant period,
including cost method equity investment impairments.
|
(6)
|
To reflect certain
non-cash interest expense related to the amortization of the debt
discount from the equity conversion option of the Company's
convertible notes.
|
(7)
|
To reflect non-cash
losses for extinguishment and partial extinguishment related to
voluntary prepayments and refinancings under the Credit Agreement
and related cash transaction costs.
|
(8)
|
To reflect an
estimated annual effective tax rate of 34.25% and 34.75% for fiscal
2015 and 2014.
|
(9)
|
Non-GAAP earnings per
share was calculated based on 292,612 and 279,205 weighted average
diluted shares outstanding for
the three months
ended June 27, 2015 and June 28, 2014, respectively, and
287,790 and 277,074 weighted average diluted
shares outstanding
for the nine months ended June 27, 2015 and June 28,
2014, respectively.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/hologic-announces-financial-results-for-third-quarter-of-fiscal-2015-300120532.html
SOURCE Hologic, Inc.