MARLBOROUGH, Mass.,
Jan. 27, 2016 /PRNewswire/ --
Hologic, Inc. (Nasdaq: HOLX) announced today the Company's
financial results for the fiscal first quarter ended December 26, 2015. Revenue of $695.2 million increased 6.5% on a reported
basis, and 8.1% on a constant currency basis. GAAP diluted
EPS of $0.29 increased 190%, and
non-GAAP diluted EPS of $0.46
increased 17.9%.
"We are pleased with our first quarter financial results
overall," said Steve MacMillan,
Hologic's Chairman, President and Chief Executive Officer.
"Our U.S. businesses again performed exceptionally well, with
double-digit revenue growth. This contributed to improvement
in our already strong operating margin, and earnings per share
growth at nearly three times the rate of revenue."
Key financial results for the fiscal first 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
|
|
|
Q1'16
|
Q1'15
|
Change
(Reported)
|
Q1'16
|
Q1'15
|
Change
(Reported)
|
Revenues
|
$695.2
|
$652.8
|
6.5%
|
$695.2
|
$652.8
|
6.5%
|
Gross
Margin
|
54.5%
|
51.9%
|
260 bps
|
65.2%
|
63.3%
|
190 bps
|
Operating
Expenses
|
$253.0
|
$235.1
|
7.6%
|
$221.0
|
$198.5
|
11.3%
|
Operating
Margin
|
18.1%
|
15.9%
|
220 bps
|
33.4%
|
32.9%
|
50 bps
|
Net Income
|
$84.9
|
$29.2
|
190.5%
|
$135.1
|
$111.6
|
21.0%
|
Diluted
EPS
|
$0.29
|
$0.10
|
190.0%
|
$0.46
|
$0.39
|
17.9%
|
Revenue Detail
Revenues grew in all four business segments globally:
$s in
millions
|
Q1'16
|
Q1'15
|
Change
(Reported)
|
Change
(Constant
Currency)
|
Cytology &
Perinatal
|
$120.4
|
$120.1
|
0.3%
|
3.1%
|
Molecular
Diagnostics
|
129.6
|
119.1
|
8.8%
|
9.9%
|
Blood
Screening
|
60.7
|
64.9
|
(6.5%)
|
(6.5%)
|
Total
Diagnostics
|
$310.7
|
$304.1
|
2.2%
|
3.7%
|
Breast
Imaging
|
218.1
|
197.5
|
10.4%
|
12.0%
|
Interventional Breast
Solutions
|
42.1
|
41.9
|
0.3%
|
1.4%
|
Other
|
2.0
|
2.6
|
(23.5%)
|
(12.8%)
|
Total Breast
Health
|
$262.2
|
$242.0
|
8.3%
|
9.9%
|
GYN
Surgical
|
$98.8
|
$84.4
|
17.1%
|
18.8%
|
Skeletal
Health
|
$23.5
|
$22.3
|
5.4%
|
7.7%
|
Total
|
$695.2
|
$652.8
|
6.5%
|
8.1%
|
Other revenue highlights:
- U.S. sales of $545.1 million
increased 12.8%, while international sales of $150.1 million decreased (11.5%) on a reported
basis, or (5.4%) in constant currency.
- In Breast Health, revenue from breast imaging products and
service totaled $218.1 million, an
increase of 10.4% on a reported basis, or 12.0% in constant
currency. In the United
States, Breast Health revenue of $214.8 million increased 15.3%, as adoption of
Hologic's GeniusTM 3D MammographyTM systems
continued to grow. Internationally, Breast Health sales of
$47.4 million declined (15.1%), or
(8.4%) in constant currency.
- In Diagnostics:
- Molecular diagnostics sales of $129.6
million increased 8.8% on a reported basis, or 9.9% in
constant currency. Growth was primarily driven by continued
strength across Aptima® women's health products on the fully
automated Panther® and Tigris® platforms.
- Cytology and perinatal sales of $120.4
million increased 0.3% on a reported basis, or 3.1% in
constant currency. International sales declined (0.2%) on a
reported basis, but grew 8.7% on a constant currency basis, while
domestic sales increased 0.5%.
- Blood screening revenue totaled $60.7
million, a decrease of (6.5%) that was driven primarily by
ordering patterns by Hologic's partner Grifols.
- In GYN Surgical, MyoSure® sales of $36.9
million increased 45.0% on a reported basis, or 46.1% in
constant currency. NovaSure® sales of $61.7 million increased 5.5% on a reported basis,
or 7.5% in constant currency.
- In Skeletal Health, revenue of $23.5
million grew 5.4% on a reported basis, or 7.7% in constant
currency.
Segment revenue highlights by geography are shown below:
|
Q1'16
|
Q1'15
|
U.S.
Change
|
International
Change
(Reported)
|
International
Change
(Constant
Currency)
|
Diagnostics
|
$310.7
|
$304.1
|
8.5%
|
(12.0%)
|
(7.0%)
|
Breast
Health
|
262.2
|
242.0
|
15.3%
|
(15.1%)
|
(8.4%)
|
GYN
Surgical
|
98.8
|
84.4
|
19.6%
|
2.6%
|
14.3%
|
Skeletal
Health
|
23.5
|
22.3
|
9.2%
|
(2.0%)
|
4.7%
|
Total
Revenues
|
$695.2
|
$652.8
|
12.8%
|
(11.5%)
|
(5.4%)
|
Expense Detail
Gross margin was 54.5% on a GAAP basis, and 65.2% on a non-GAAP
basis. Gross margin improved mainly due to strong domestic
sales growth, favorable product mix, and operational
improvements. These benefits were partially offset by a
stronger U.S. dollar.
Operating expenses were $253.0
million on a GAAP basis, and $221.0
million on a non-GAAP basis. Operating expenses
increased mainly due to marketing investments in the Breast Health
and Diagnostics divisions, as well as higher variable compensation
and benefits expense.
Other Key Financial Results
Operating cash flow was $164.3
million, an increase of 7.0% compared to the prior year
period. Free cash flow, defined as operating cash flow less
capital expenditures, was $144.6
million.
Adjusted non-GAAP earnings before interest, taxes, depreciation
and amortization (EBITDA) were $252.0
million, an increase of 8.1% compared to the prior year
period.
Total debt outstanding at the end of the fiscal first quarter
was $3,632.4 million, a decrease of
$322.4 million compared to the prior
year period. The combination of lower debt and EBITDA growth
has helped improve Hologic's leverage ratio (net debt over EBITDA)
to 3.1 times.
Similarly, strong profit growth and lower debt have improved
Hologic's return on invested capital (ROIC), which was 11.3% on a
trailing 12 months basis, a 160 basis point increase compared to
the prior year period.
The Company ended the quarter with cash and cash equivalents of
$650.3 million.
Financial Guidance for Fiscal 2016
"Building on our solid performance in the first quarter, we are
updating our fiscal 2016 revenue guidance based on a stronger U.S.
dollar, but increasing our EPS guidance to reflect
greater-than-expected earnings power," said Bob McMahon, the Company's Chief Financial
Officer.
The guidance below is based on recent foreign exchange rates, an
improved full-year tax rate of approximately 33%, and diluted
shares outstanding of between 296 and 298 million for the full
year.
|
Current
Guidance
|
Previous
Guidance
|
Current Guidance
vs.
Prior Year
(As
Reported)
|
Current Guidance
vs.
Prior Year
(Constant
Currency)
|
Revenues
|
$2,800 to $2,830
million
|
$2,810 to $2,840
million
|
3.5% to
4.6%
|
4.4% to
5.5%
|
Non-GAAP
EPS
|
$1.86 to
$1.90
|
$1.80 to
$1.84
|
11.4% to
13.8%
|
13.1% to
15.5%
|
For the second quarter of fiscal 2016, Hologic expects:
|
Current
Guidance
|
Current Guidance vs.
Prior Year
Period (As Reported)
|
Current Guidance vs.
Prior
Year Period (Constant Currency)
|
Revenues
|
$680 to $690
million
|
3.7% to
5.3%
|
4.5% to
6.0%
|
Non-GAAP
EPS
|
$0.45 to
$0.46
|
9.8% to
12.2%
|
11.2% to
13.6%
|
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) additional depreciation expense from
acquired fixed assets and accelerated depreciation related to
consolidation and closure of facilities; (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 facility and
consolidation charges; (v) debt extinguishment losses and related
transaction costs; (vi) litigation settlement charges (benefits);
(vii) other-than-temporary impairment losses on investments and
realized gains resulting from the sale of 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.
These non-GAAP financial measures should be considered
supplemental to, and not a substitute for, financial information
prepared in accordance with GAAP. The company's definition of
these non-GAAP measures may differ from similarly titled measures
used by others.
The non-GAAP financial measures used in this press release
adjust for specified items that can be highly variable or difficult
to predict. The company generally uses these non-GAAP
financial measures to facilitate management's financial and
operational decision-making, including evaluation of Hologic's
historical operating results, comparison to competitors' operating
results and determination of management incentive
compensation. These non-GAAP financial measures reflect an
additional way of viewing aspects of the company's operations that,
when viewed with GAAP results and the reconciliations to
corresponding GAAP financial measures, may provide a more complete
understanding of factors and trends affecting Hologic's
business.
Because non-GAAP financial measures exclude the effect of items
that will increase or decrease the company's reported results of
operations, management strongly encourages investors to review the
company's consolidated financial statements and publicly filed
reports in their entirety. A reconciliation of the non-GAAP
financial measures to the most directly comparable GAAP financial
measures is included in the tables accompanying this release.
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 first quarter of fiscal 2016. Approximately
10 minutes before the call, dial 877-719-9786 (U.S. and
Canada) or 719-325-4908
(international) and enter access code 7932634. A replay will
be available starting two hours after the call ends through
February 26, 2016 at 888-203-1112
(U.S. and Canada) or 719-457-0820
(international), access code 7932634. The Company will also
provide a live webcast of the call at http://investors.hologic.com.
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, the need to comply with especially high
standards for the manufacture of many of its products and risks
associated with utilizing third party manufacturers; 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 INCOME
|
(Unaudited)
|
(In millions, except
number of shares, which are reflected in thousands, and per share
data)
|
|
|
|
Three Months
Ended
|
|
December 26,
2015
|
|
December 27,
2014
|
|
|
|
|
Revenues:
|
|
|
|
Product
|
$
|
587.2
|
|
|
$
|
546.6
|
|
Service and
other
|
108.0
|
|
|
106.2
|
|
Total
revenues
|
695.2
|
|
|
652.8
|
|
|
|
|
|
Cost of
revenues:
|
|
|
|
Product
|
188.2
|
|
|
186.7
|
|
Amortization of
intangible assets
|
73.4
|
|
|
73.9
|
|
Service and
other
|
54.5
|
|
|
53.6
|
|
|
|
|
|
Gross
profit
|
379.1
|
|
|
338.6
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
Research and
development
|
51.7
|
|
|
52.0
|
|
Selling and
marketing
|
99.4
|
|
|
86.0
|
|
General and
administrative
|
77.0
|
|
|
61.3
|
|
Amortization of
intangible assets
|
22.6
|
|
|
27.8
|
|
Restructuring and
divestiture charges
|
2.3
|
|
|
8.0
|
|
Total operating
expenses
|
253.0
|
|
|
235.1
|
|
|
|
|
|
Income from
operations
|
126.1
|
|
|
103.5
|
|
Interest
income
|
0.2
|
|
|
0.4
|
|
Interest
expense
|
(39.2)
|
|
|
(52.5)
|
|
Debt extinguishment
loss
|
—
|
|
|
(6.7)
|
|
Other income
(expense), net
|
27.6
|
|
|
(0.6)
|
|
|
|
|
|
Income before income
taxes
|
114.7
|
|
|
44.1
|
|
Provision for income
taxes
|
29.8
|
|
|
14.9
|
|
|
|
|
|
Net
income
|
$
|
84.9
|
|
|
$
|
29.2
|
|
|
|
|
|
Net income per
common share:
|
|
|
|
Basic
|
$
|
0.30
|
|
|
$
|
0.10
|
|
Diluted
|
$
|
0.29
|
|
|
$
|
0.10
|
|
|
|
|
|
Weighted average
number of shares outstanding:
|
|
|
|
Basic
|
282,976
|
|
|
278,671
|
|
Diluted
|
291,971
|
|
|
283,176
|
|
HOLOGIC,
INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Unaudited)
|
(In
millions)
|
|
|
|
|
|
December 26,
2015
|
|
September 26,
2015
|
ASSETS
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
650.3
|
|
|
$
|
492.7
|
|
Accounts receivable,
net
|
410.5
|
|
|
416.1
|
|
Inventories
|
286.4
|
|
|
283.1
|
|
Deferred income
taxes
|
—
|
|
|
19.0
|
|
Other current
assets
|
40.5
|
|
|
55.5
|
|
Total current
assets
|
1,387.7
|
|
|
1,266.4
|
|
|
|
|
|
Property, plant and
equipment, net
|
454.5
|
|
|
457.1
|
|
Goodwill and
intangible assets
|
5,733.6
|
|
|
5,831.4
|
|
Other
assets
|
103.7
|
|
|
115.2
|
|
Total
assets
|
$
|
7,679.5
|
|
|
$
|
7,670.1
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
Current portion of
long-term debt
|
$
|
393.3
|
|
|
$
|
391.8
|
|
Accounts payable and
accrued liabilities
|
365.2
|
|
|
389.1
|
|
Deferred
revenue
|
156.9
|
|
|
163.1
|
|
Total current
liabilities
|
915.4
|
|
|
944.0
|
|
|
|
|
|
Long-term debt, net
of current portion
|
3,239.1
|
|
|
3,248.0
|
|
Deferred income
taxes
|
1,131.6
|
|
|
1,178.4
|
|
Other long-term
liabilities
|
227.1
|
|
|
220.5
|
|
Total
liabilities
|
5,513.2
|
|
|
5,590.9
|
|
Total stockholders'
equity
|
2,166.3
|
|
|
2,079.2
|
|
Total liabilities
and stockholders' equity
|
$
|
7,679.5
|
|
|
$
|
7,670.1
|
|
HOLOGIC,
INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(Unaudited)
|
(in
millions)
|
|
|
|
Three Months
Ended
|
|
December 26,
2015
|
|
December 27,
2014
|
OPERATING
ACTIVITIES
|
|
|
|
Net income
|
$
|
84.9
|
|
|
$
|
29.2
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation
|
19.9
|
|
|
20.3
|
|
Amortization
|
96.0
|
|
|
101.7
|
|
Non-cash interest
expense
|
13.2
|
|
|
16.7
|
|
Stock-based
compensation expense
|
15.9
|
|
|
12.1
|
|
Excess tax benefit
related to equity awards
|
(7.1)
|
|
|
(3.0)
|
|
Deferred income
taxes
|
(28.0)
|
|
|
(30.5)
|
|
Gain on sale of
available-for-sale marketable security
|
(25.1)
|
|
|
—
|
|
Debt extinguishment
loss
|
—
|
|
|
6.7
|
|
Loss on disposal of
property and equipment
|
1.3
|
|
|
1.7
|
|
Other adjustments and
non-cash items
|
(1.5)
|
|
|
1.2
|
|
Changes in operating
assets and liabilities:
|
|
|
|
Accounts
receivable
|
4.3
|
|
|
(9.7)
|
|
Inventories
|
(3.6)
|
|
|
18.7
|
|
Prepaid income
taxes
|
21.7
|
|
|
22.4
|
|
Prepaid expenses and
other assets
|
(7.7)
|
|
|
(3.0)
|
|
Accounts
payable
|
(4.9)
|
|
|
(24.8)
|
|
Accrued expenses and
other liabilities
|
(9.8)
|
|
|
(5.0)
|
|
Deferred
revenue
|
(5.2)
|
|
|
(1.2)
|
|
Net cash provided by
operating activities
|
164.3
|
|
|
153.5
|
|
INVESTING
ACTIVITIES
|
|
|
|
Purchase of property
and equipment
|
(9.1)
|
|
|
(10.8)
|
|
Increase in equipment
under customer usage agreements
|
(10.6)
|
|
|
(10.3)
|
|
Proceeds from sale of
available-for-sale marketable security
|
31.1
|
|
|
—
|
|
Purchases of
insurance contracts
|
—
|
|
|
(6.4)
|
|
Sales of mutual
funds
|
—
|
|
|
6.4
|
|
Increase in other
assets
|
0.9
|
|
|
(0.9)
|
|
Net cash provided by
(used in) investing activities
|
12.3
|
|
|
(22.0)
|
|
FINANCING
ACTIVITIES
|
|
|
|
Repayment of
long-term debt
|
(18.8)
|
|
|
(328.8)
|
|
Repurchase of
convertible notes
|
(0.1)
|
|
|
—
|
|
Net proceeds from
issuance of common stock pursuant to employee stock
plans
|
11.1
|
|
|
15.2
|
|
Excess tax benefit
related to equity awards
|
7.1
|
|
|
3.0
|
|
Payment of minimum
tax withholdings on net share settlements of equity
awards
|
(14.9)
|
|
|
(10.6)
|
|
Net cash used in
financing activities
|
(15.6)
|
|
|
(321.2)
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
(2.0)
|
|
|
(2.4)
|
|
Net increase
(decrease) in cash and cash equivalents
|
159.0
|
|
|
(192.1)
|
|
Cash and cash
equivalents, beginning of period
|
491.3
|
|
|
736.1
|
|
Cash and cash
equivalents, end of period
|
$
|
650.3
|
|
|
$
|
544.0
|
|
HOLOGIC,
INC.
|
RECONCILIATION OF
GAAP TO NON-GAAP RESULTS
|
(Unaudited)
|
(In millions, except
earnings per share and margin percentages)
|
|
|
|
Three Months
Ended
|
|
December 26,
2015
|
|
December 27,
2014
|
Gross
Profit:
|
|
|
|
GAAP gross
profit
|
$
|
379.1
|
|
|
$
|
338.6
|
|
Adjustments:
|
|
|
|
Amortization of
intangible assets (1)
|
73.4
|
|
|
73.9
|
|
Incremental
depreciation expense (2)
|
0.5
|
|
|
0.8
|
|
Integration/consolidation costs (3)
|
—
|
|
|
0.2
|
|
Non-GAAP gross
profit
|
$
|
453.0
|
|
|
$
|
413.5
|
|
|
|
|
|
Gross Margin
Percentage:
|
|
|
|
GAAP gross margin
percentage
|
54.5
|
%
|
|
51.9
|
%
|
Impact of adjustments
above
|
10.7
|
%
|
|
11.4
|
%
|
Non-GAAP gross margin
percentage
|
65.2
|
%
|
|
63.3
|
%
|
|
|
|
|
Operating
Expenses:
|
|
|
|
GAAP operating
expenses
|
$
|
253.0
|
|
|
$
|
235.1
|
|
Adjustments:
|
|
|
|
Amortization of
intangible assets (1)
|
(22.6)
|
|
|
(27.8)
|
|
Incremental
depreciation expense (2)
|
(0.9)
|
|
|
(0.6)
|
|
Integration/consolidation costs (3)
|
(0.2)
|
|
|
—
|
|
Restructuring and
divestiture charges (3)
|
(2.3)
|
|
|
(8.0)
|
|
Other (4)
|
(6.0)
|
|
|
(0.2)
|
|
Non-GAAP operating
expenses
|
$
|
221.0
|
|
|
$
|
198.5
|
|
|
|
|
|
Operating
Margin:
|
|
|
|
GAAP income from
operations
|
126.1
|
|
|
103.5
|
|
Adjustments to gross
profit as detailed above
|
73.9
|
|
|
74.9
|
|
Adjustments to
operating expenses as detailed above
|
32.0
|
|
|
36.6
|
|
Non-GAAP income from
operations
|
$
|
232.0
|
|
|
$
|
215.0
|
|
|
|
|
|
Operating Margin
Percentage:
|
|
|
|
GAAP income from
operations margin percentage
|
18.1
|
%
|
|
15.9
|
%
|
Impact of adjustments
above
|
15.3
|
%
|
|
17.0
|
%
|
Non-GAAP operating
margin percentage
|
33.4
|
%
|
|
32.9
|
%
|
|
|
|
|
Interest
Expense:
|
|
|
|
GAAP interest
expense
|
$
|
39.2
|
|
|
$
|
52.5
|
|
Adjustments:
|
|
|
|
Non-cash
interest expense relating to convertible notes (5)
|
(6.4)
|
|
|
(8.8)
|
|
Non-GAAP interest
expense
|
$
|
32.8
|
|
|
$
|
43.7
|
|
|
|
|
|
|
Pre-Tax
Income:
|
|
|
|
|
GAAP pre-tax
earnings
|
$
|
114.7
|
|
|
$
|
44.1
|
|
Adjustments to
pre-tax earnings as detailed above
|
112.3
|
|
|
120.3
|
|
Debt extinguishment
loss (6)
|
—
|
|
|
6.7
|
|
Gain on sale of
available-for-sale marketable security (7)
|
(25.1)
|
|
|
—
|
|
Unrealized gains on
forward foreign currency contracts (8)
|
(1.0)
|
|
|
—
|
|
Non-GAAP pre-tax
Income
|
$
|
200.9
|
|
|
$
|
171.1
|
|
|
|
|
|
|
Net
income:
|
|
|
|
|
GAAP net
income
|
$
|
84.9
|
|
|
$
|
29.2
|
|
Adjustments:
|
|
|
|
|
Amortization of
intangible assets (1)
|
96.0
|
|
|
101.7
|
|
Non-cash interest
expense relating to convertible notes (5)
|
6.4
|
|
|
8.8
|
|
Restructuring,
divestiture and integration/consolidation costs (3)
|
2.5
|
|
|
8.2
|
|
Incremental
depreciation expenses (2)
|
1.4
|
|
|
1.4
|
|
Debt extinguishment
loss (6)
|
—
|
|
|
6.7
|
|
Gain on sale of
available-for-sale marketable security (7)
|
(25.1)
|
|
|
—
|
|
Unrealized gains on
forward foreign currency contracts (8)
|
(1.0)
|
|
|
—
|
|
Other charges
(4)
|
6.0
|
|
|
0.2
|
|
Income tax effect of
reconciling items (9)
|
(36.0)
|
|
|
(44.6)
|
|
Non-GAAP net
income
|
$
|
135.1
|
|
|
$
|
111.6
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
GAAP earnings per
share - Diluted
|
$
|
0.29
|
|
|
$
|
0.10
|
|
Adjustment to net
earnings (as detailed above)
|
0.17
|
|
|
|
0.29
|
|
Non-GAAP earnings per
share – diluted (10)
|
$
|
0.46
|
|
|
$
|
0.39
|
|
|
|
|
|
|
Adjusted
EBITDA:
|
|
|
|
|
Non-GAAP net
income
|
$
|
135.1
|
|
|
$
|
111.6
|
|
Interest expense,
net, not adjusted above
|
32.6
|
|
|
43.2
|
|
Provision for income
taxes
|
65.8
|
|
|
59.5
|
|
Depreciation expense,
not adjusted above
|
18.5
|
|
|
18.8
|
|
Adjusted
EBITDA
|
$
|
252.0
|
|
|
$
|
233.1
|
|
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 integration and facility consolidation plans,
which primarily include retention and transfer costs.
|
(4)
|
To reflect the net
impact from miscellaneous transactions during the relevant period,
including legal settlements.
|
(5)
|
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.
|
(6)
|
To reflect losses for
partial extinguishment related to voluntary prepayments under the
Prior Credit Agreement.
|
(7)
|
To reflect realized
gain on sale of available-for-sale marketable security.
|
(8)
|
To reflect non-cash
unrealized gains on the market-to market on outstanding forward
foreign currency contracts.
|
(9)
|
To reflect an
estimated annual effective tax rate of 32.75% and 34.75% for fiscal
2016 and 2015.
|
(10)
|
Non-GAAP earnings per
share was calculated based on 291,971 and 283,176 weighted average
diluted shares outstanding for the three months ended
December 26, 2015 and December 27, 2014,
respectively.
|
|
Trailing Twelve
Months
ended
December 26,
2015
|
Return on Invested
Capital:
|
|
Adjusted Net
Operating Profit After Tax
|
|
Net income
|
508.1
|
Provision for income
taxes
|
258.8
|
Interest
expense
|
150.6
|
Adjusted net
operating profit before tax
|
917.5
|
Non-GAAP average
effective tax rate (1)
|
33.76%
|
Adjusted net
operating profit after tax
|
607.8
|
|
|
Average Net Debt plus
Average Stockholders' Equity (2)
|
|
Average total
debt
|
3,793.6
|
Less: Average cash,
cash equivalents and restricted cash
|
(599.7)
|
Average net
debt
|
3,193.9
|
Average stockholders'
equity (3)
|
2,166.6
|
Average net debt plus
average stockholders' equity
|
5,360.5
|
|
|
Adjusted
ROIC
|
|
Adjusted ROIC
(adjusted net operating profit after tax
above divided by
average net debt plus stockholders' equity
above)
|
11.34%
|
|
|
|
|
(1)
|
ROIC is presented on
a TTM basis; non-GAAP effective tax rate for the three months ended
March 28, 2015 was 33.77%; the three months ended June 27, 2015 and
September 26, 2015 was 34.25%; and the three months ended December
26, 2015 was 32.75%.
|
(2)
|
Calculated using the
average of the balances as of December 26, 2015 and
December 27, 2014.
|
(3)
|
Adjusted (increased)
to eliminate the effect of the impairment of intangible assets of
$32.2 million in fiscal 2014.
|
|
|
|
|
|
Three Months
Ended
|
|
December 26,
2015
|
Leverage
Ratio:
|
|
Total principal
debt
|
3,702.0
|
Total cash
|
(650.3)
|
Net principal debt,
as adjusted
|
3,051.7
|
EBITDA for the last
four
quarters
|
991.2
|
Leverage
Ratio
|
3.08
|
Other Supplemental Information:
Geographic
Revenues
|
Q1'16
|
Q1'15
|
U.S.
|
78.4%
|
74.0%
|
Europe
|
10.0%
|
13.6%
|
Asia-Pacific
|
7.9%
|
8.7%
|
All others
|
3.7%
|
3.7%
|
Total
Revenues
|
100.0%
|
100.0%
|
|
Revenue
Composition
|
Q1'16
|
|
Disposables
|
62%
|
Capital
Equipment
|
22%
|
Service &
Other
|
16%
|
Total
Revenues
|
100%
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/hologic-announces-financial-results-for-first-quarter-of-fiscal-2016-300210683.html
SOURCE Hologic, Inc.