Bio-Rad Reports Third-Quarter 2023 Financial Results

Original from: business wire

Bio-Rad Laboratories, Inc. (NYSE: BIO and BIOb), a global leader in life science research and clinical diagnostics products, today announced financial results for the third quarter ended September 30, 2023.

Third-quarter 2023 total net sales were $632.1 million, a decrease of 7.1 percent compared to $680.8 million reported for the third quarter of 2022. On a currency-neutral basis, quarterly sales decreased 7.9 percent compared to the same period in 2022. COVID-related sales were approximately $0.3 million in the third quarter of 2023 versus approximately $17.2 million in the year ago period. Excluding COVID-related sales, revenue decreased 5.5 percent on a currency-neutral basis.

Life Science segment net sales for the third quarter were $263.5 million, a decrease of 17.1 percent compared to the same period in 2022. On a currency-neutral basis, Life Science segment sales decreased by 17.8 percent compared to the same quarter in 2022. Excluding COVID-related sales, Life Science revenue decreased 13.7 percent and was primarily driven by lower sales of qPCR and process chromatography, and western blotting products.

Clinical Diagnostics segment net sales for the third quarter were $368.1 million, an increase of 1.7 percent compared to the same period in 2022. On a currency-neutral basis, net sales increased 1.0 percent versus the same quarter last year. Excluding COVID-related sales, Clinical Diagnostics revenue increased 1.4 percent year over year, on a currency-neutral basis, driven by increased demand for diagnostic testing systems, as well as quality control products.

Third-quarter gross margin was 53.1 percent compared to 54.7 percent during the third quarter of 2022.

Income from operations during the third quarter of 2023 was $90.9 million versus $94.6 million during the same quarter last year.

Net income for the third quarter of 2023 was $106.3 million, or $3.64 per share, on a diluted basis, versus a net loss of $162.8 million, or $5.48 per share, on a diluted basis, during the same period in 2022. Net income and net loss amounts for the third quarter of 2023 and 2022 were primarily impacted by the recognition of changes in the fair market value of equity securities related to the holdings of the company’s investment in Sartorius AG.

The effective tax rate for the third quarter of 2023 was 22.5 percent, compared to 21.5 percent for the same period in 2022. The third quarter 2023 effective tax rate was primarily affected by an unrealized gain in equity securities and the tax rate reported in the third quarter of 2022 was primarily affected by an unrealized loss in equity securities.

“Our third-quarter results came in below our expectations and were primarily impacted by further deterioration in biopharma and early biotech customer spending, as well as a challenging macroeconomic environment in China,” said Norman Schwartz, Bio-Rad’s President and Chief Executive Officer. “Given the uncertain pace of the biopharma sector’s recovery and the ongoing macro challenges, we are lowering our full-year 2023 outlook but remain confident about our overall strategy framework and long-term market opportunities.”

The non-GAAP financial measures discussed below exclude certain items detailed later in this press release under the heading “Use of Non-GAAP and Currency-Neutral Reporting.” A reconciliation between historical GAAP operating results and non-GAAP operating results is provided following the financial statements that are part of this press release.

Non-GAAP gross margin was 53.9 percent for the third quarter of 2023 compared to 55.6 percent during the third quarter of 2022.

Non-GAAP income from operations during the third quarter of 2023 was $81.6 million versus $107.6 million during the comparable prior-year period.

Non-GAAP net income for the third quarter of 2023 was $68.1 million, or $2.33 per share, on a diluted basis, compared to $79.2 million, or $2.64 per share, on a diluted basis, during the same period in 2022.

The non-GAAP effective tax rate for the third quarter of 2023 was 23.9 percent, compared to 21.7 percent for the same period in 2022. The higher rate in 2023 was driven by geographical mix of earnings and reduced compensation-related deductions.

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Updated 2023 Financial Outlook

Bio-Rad is updating its financial outlook for full-year 2023. The company currently expects its non-GAAP revenue to decline by approximately 3.5 percent on a currency-neutral basis compared to its previous estimate of a 0.8 percent revenue growth. Bio-Rad also estimates a non-GAAP operating margin of about 14.5 percent versus the company’s prior estimate of approximately 16 percent. Excluding COVID-related sales, Bio-Rad estimates non-GAAP revenue growth to be between 0 and 0.5 percent on a currency-neutral basis compared to its prior expectation of approximately 4.5 percent.​

Source: Bio-Rad Reports Third-Quarter 2023 Financial Results