Sep. 24, 2009 (PR Newswire) --
LANSING, Mich., Sept. 24 /PRNewswire-FirstCall/ -- Neogen Corporation (Nasdaq: NEOG) announced today that its revenues for the first quarter of FY 2010, which ended Aug. 31, increased 12% from the previous year's first quarter to $32,347,000. First quarter net income increased 18% from the prior year's $3,733,000 to $4,395,000, or to $0.29 per share in the current year compared to the previous year's $0.25.
Neogen's first quarter revenues, net income, and earnings per share all represent quarterly records for the 27-year-old company. The company's record quarter came despite currency exchange rates that had an unfavorable impact of $1.0 million on Neogen's international net sales when compared to the prior year's first quarter.
"The first quarter was a great start for our new fiscal year as our food and animal safety strategy continues to gain worldwide strength," said James Herbert, Neogen's chief executive officer and chairman. "We are able to report that we grew our top line at a double-digit pace, and our profitability at a pace that exceeded revenue growth. These results provide further evidence of improving efficiencies and general operational strength throughout Neogen."
The quarter marked the 66th consecutive profitable quarter from operations for the company, and was the 70th of the past 75 quarters when Neogen reported revenue increases as compared with the previous year.
"We are obviously pleased to report that the 23% increase in our operating profit was approximately double the percentage increase in our revenues," said Lon Bohannon, Neogen's president and chief operating officer. "We believe that our growth performance at the operating profit line is evidence of our commitment to control costs as our revenues advance. The only expense category that increased faster than our revenue growth was our planned investment in research and development. We are very pleased to be able to accelerate our R&D spending for Neogen's future, and still report today's exceptional results."
Largely the result of a favorable product mix that included a greater percentage of diagnostic products, Neogen's gross margin increased to 53.4% of sales in its first quarter of the current year, compared to 51.4% of sales in its FY 2009 first quarter. Neogen's operating income for the first quarter equaled 21.5% of the company's quarterly revenues.
"As our consolidated balance sheet data shows, we had an exceptional quarter generating cash, and we now have more than $23 million in cash and investments to pursue a wide variety of growth strategies," said Richard Current, Neogen's chief financial officer. "Our inventories are down in comparison to our prior quarter, as we continue our progress in controlling the level of inventories without impacting sales. Our accounts receivable have increased slightly, but at a pace less than our sales increase. We continue to monitor the financial health of our customers to avoid collection concerns, and have yet to experience significant receivable problems."
Neogen's Food Safety and Animal Safety Divisions posted nearly identical 12% revenue increases in the first quarter compared to the prior year's first quarter.
