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Bio-Rad Q1 Revenues Rise 3 Percent

NEW YORK – Bio-Rad Laboratories reported Wednesday after the close of the market that its first quarter revenues increased 3 percent year over year.

For the three months ended March 31, 2020, Bio-Rad reported revenues of $571.6 million compared to $554.0 million a year ago, and well ahead of analysts' expectation for revenues of $554.9 million.

On a currency-neutral basis, Q1 revenues increased 4 percent year over year, the company said.

First quarter Life Science segment sales rose 5 percent year over year to $227.2 million, or 6 percent on a currency-neutral basis. The company said growth in this segment was primarily driven by sales of Droplet Digital PCR, gene expression, food science, and antibody products.

In a conference call recapping financial results, Bio-Rad Executive Vice President and CFO Ilan Daskal said that sales of PCR and Droplet Digital PCR products were driven by strong demand in COVID-19-related testing and research. Growth in the Life Sciences segment was somewhat tempered, however, by softer academic research demands as well as a difficult comparison to 2019 related to the company's process media product line.

Clinical Diagnostics segment sales increased 2 percent to $340.3 million in Q1, or 3 percent on a currency-neutral basis. Growth in this segment was positively affected by quality control and blood typing products, but somewhat offset by a year-over-year decline in its diabetes and immunology product lines.

During the quarter, Bio-Rad acquired single-cell analysis firm Celsee. Though it didn't disclose the acquisition price at the time, Daskal said during the earnings call that the acquisition price was $100 million.

Also during the call, Annette Tumolo, executive VP and president of Bio-Rad's Life Science Group, provided additional color on Bio-Rad's rationale for the acquisition.

"Certainly, the acquisition comes with important intellectual property, but this technology is one that we think has broad applications in the single-cell partitioning and sorting market," Tumolo said. "It's flexible, cost-effective, scalable to high-throughput cell analysis, and really well suited to the kind of transcriptomics and multi-omics applications that customers trying to interrogate single cells are so interested in doing."

In the past week, the company received separate Emergency Use Authorizations from the US Food and Drug Administration for a molecular test for SARS-CoV-2 based on its Droplet Digital PCR platform and for its Platelia Total Ab immunoassay for detecting SARS-CoV-2 viral infections.

Bio-Rad reported net income of $685.9 million, or $22.72 per share, in Q1 compared to $865.2 million, or $28.74 per share, in the year-ago period. On an adjusted basis, net income was $57.6 million, or $1.91 per share, besting analysts' average estimate of $1.61.

The company noted that net income for the first quarters of both 2020 and 2019 were significantly and favorably impacted by the recognition of changes in the fair market value of equity securities of $827.7 million and $1.06 billion, respectively, primarily related to the holdings of the company's investment in Sartorius.

Bio-Rad's Q1 R&D expenditures increased 4 percent year over year to $49.3 million from $47.6 million, while its SG&A spending fell 7 percent to $193.7 million from $207.6 million a year ago.

The company ended the quarter with $603.6 million in cash and cash equivalents, and $438.7 million in short-term investments.

Bio-Rad said it is withdrawing its previously issued annual guidance of currency-neutral revenue growth of 4.5 to 5.25 percent given the uncertainties regarding the duration and impact of the COVID-19 pandemic. The company said that it believes its second quarter year-over-year revenues may decline by 10 to 15 percent.