Harvard Bioscience Announces Strategic Action Plan and Financial Targets
September 09 2019 - 8:00AM
Harvard Bioscience, Inc. (Nasdaq: HBIO) today announces its
strategic action plan and financial targets for rest of year 2019
through 2021.
Key strategic actions and financial targets to position Harvard
Bioscience for long-term profitable growth:
Strategic Action |
Timing |
• |
Stabilize business and complete leadership team |
2019 |
• |
Refinance debt and reduce
interest expense |
2019 |
• |
Improve margins through
consolidations, reduced COGS and operating expenses |
2019 & 2020 |
• |
Optimize manufacturing and supply
chain |
2019 & 2020 |
• |
Reenergize and refocus sales
operations |
2019 & 2020 |
• |
Rationalize product portfolio and
pricing |
2019 & 2020 |
• |
Pay down debt and reduce leverage
ratio to < 3x by end of 2020 |
2020 |
• |
Disciplined return to
opportunistic acquisitions |
2021 |
Non-GAAP Financial Targets |
• |
2019: Meet existing guidance |
• |
2nd half of 2020: Modest organic
revenue growth; 58% gross margin; 10% operating margin (GAAP); 17%
adjusted operating margin |
• |
2021: 6-8% organic revenue
growth; 60% gross margin; 13% operating margin (GAAP); 20% adjusted
operating margin |
Refer to Supplemental Financial Information, Non-GAAP Measures
for more detail and a reconciliation of adjusted operating
margin. Subsequent to 2019 no significant adjustments to
gross margin reported on a GAAP basis are expected.
Jim Green, Chairman, President and CEO said, “The strategic
actions announced today will make Harvard Bioscience a strong,
efficient platform for profitable growth in 2020 and beyond. Our
financial targets evidence my commitment to execute on these
actions with urgency and create significant value for our
shareholders.”
Harvard Bioscience’s management will discuss these updates at
the Janney Montgomery Scott Healthcare Conference on Monday,
September 9, 2019 at 9:05 a.m. EDT. A webcast of the presentation
can be accessed as follows:
|
Step 1: Dial-In: |
1-800-954-0585 |
|
Step
2: Login: |
https://cc.callinfo.com/r/1w6wwfzvowg50&eom |
For those unable
to view the live webcast, a replay and a copy of the presentation
materials will be available shortly after the event on the Events
& Presentations section of our web site
at www.harvardbioscience.com.
Forward-Looking Statements
This information in this press release and the related
presentation referred to above may include forward-looking
statements within the meaning of the federal securities laws,
including the Private Securities Litigation Reform Act of 1995. You
can identify these statements by our use of such words as "will,"
"guidance," "objectives," "optimistic," "potential," "future,"
"expects," "plans," "estimates," "continue," "drive," "strategy,"
"potential," "potentially," "growth," "long-term," "projects,"
"projected," "intends," "believes," "goals," "sees," "seek,"
"develop" "possible" "new," "emerging," "opportunity," "pursue" and
similar expressions that do not relate to historical matters.
Forward-looking statements in this presentation or that may be made
during our presentation may include, but are not limited to,
statements or inferences about the Company's or management's
beliefs or expectations, the Company's anticipated future revenues
and earnings, the strength of the Company's market position and
business model, industry outlook; the Company's business strategy,
the positioning of the Company for growth, the market demand and
opportunity for the Company's current products, or products it is
developing or intends to develop, and the Company's plans,
objectives and intentions that are not historical facts. These
statements involve known and unknown risks, uncertainties and other
factors that may cause the Company's actual results, performance or
achievements to be materially different from any future results,
performance or achievements expressed or implied by the
forward-looking statements. Investors should note that many
factors, as more fully described under the caption “Risk Factors”
in our Form 10-K, including our Form 10-K for the year ended
December 31, 2018, Form 10-Q and Form 8-K filings with the
Securities and Exchange Commission and as otherwise enumerated
herein or therein may cause the Company's actual results to differ
materially from those in the forward-looking statements. The
forward-looking statements in this presentation are qualified by
these risk factors. The Company's results may also be affected
by factors of which the Company is not currently aware. The Company
may not update these forward-looking statements, even though its
situation may change in the future, unless it has obligations under
the federal securities laws to update and disclose material
developments related to previously disclosed information.
Management’s Use of Non-GAAP Financial
Information
In this press release and related presentation referred to above
we have included non-GAAP financial information including adjusted
revenue, adjusted gross profit, adjusted operating income, adjusted
net income and adjusted earnings per diluted share. We believe that
this non-GAAP financial information provides investors with an
enhanced understanding of the underlying operations of the
business. For the periods presented, these non-GAAP financial
measures of revenue and income have excluded certain revenue and
expenses and income primarily resulting from purchase accounting or
events that we do not believe are related to the underlying
operations of the business such as currency translation,
amortization of intangibles related to acquisitions, costs related
to acquisition, disposition and integration initiatives, impairment
charges, gains or losses from divestitures, forensic investigation
and remediation costs, severance and restructuring expenses, and
stock-based compensation expense. They also exclude the tax impact
of the reconciling items. This non-GAAP financial information
approximates information used by our management to internally
evaluate the operating results of the Company. Any non-GAAP
measures included herein will be accompanied by a reconciliation to
the nearest corresponding GAAP measure either within the
presentation or on the Company’s website;
www.harvardbioscience.com
The non-GAAP financial information provided in this press
release and related presentation should be considered in addition
to, not as a substitute for, the financial information provided and
presented in accordance with GAAP and may be different than other
companies’ non-GAAP financial information.
Harvard Bioscience, Inc. |
Supplemental Financial Information - Non-GAAP Measures |
2019 Guidance & 2020 2nd Half and 2021 Operating Margin
Targets |
|
|
2019 Guidance |
|
2020 2H |
|
2021 FY |
GAAP Operating Margin* |
|
~1% |
|
10% |
|
13% |
Adjustments: |
|
|
|
|
|
|
Amortization of intangible assets |
|
5% |
|
5% |
|
4% |
Severance and restructuring charges |
|
3% |
|
0% |
|
0% |
Stock-based compensation expense |
|
3% |
|
3% |
|
3% |
Impairment of intangible asset |
|
1% |
|
0% |
|
0% |
Non-GAAP Operating Margin |
|
~12% |
|
17% |
|
20% |
|
*subject to
rounding |
|
About Harvard Bioscience
Harvard Bioscience is a global developer, manufacturer and
marketer of a broad range of solutions to advance life science. Our
products are sold to thousands of researchers in over 100 countries
through our global sales organization, websites, catalogs, and
through distributors. We have sales and manufacturing operations in
the United States, the United Kingdom, Germany, Sweden, Spain,
France, Canada and China. For more information, please visit our
website at www.harvardbioscience.com.
CONTACT: Michael Rossi Chief Financial Officer Tel: 508 893
8999
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