Bio-Rad(US:BIO)2025-07-31 20:17Part I - Financial Information Financial Statements The unaudited condensed consolidated financial statements for the period ended June 30, 2025, show total assets increasing to $10.21 billion, net income for the first six months at $381.8 million (a turnaround from a $1.78 billion loss), and operating cash flow increasing to $246.4 million Condensed Consolidated Balance Sheets As of June 30, 2025, total assets increased to $10.21 billion from $9.36 billion, driven by higher other investments and goodwill, while total liabilities grew to $3.09 billion and stockholders' equity to $7.13 billion Condensed Consolidated Balance Sheet Highlights (in millions) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | $10,214.1 | $9,364.1 | | Cash and cash equivalents | $369.3 | $488.1 | | Goodwill, net | $581.6 | $410.5 | | Other investments | $5,576.5 | $4,839.2 | | Total Liabilities | $3,085.4 | $2,794.8 | | Long-term debt, net | $1,201.1 | $1,200.4 | | Total Stockholders' Equity | $7,128.7 | $6,569.3 | Condensed Consolidated Statements of Income (Loss) Net income for Q2 2025 was $317.8 million (vs. $2.17 billion loss in Q2 2024) and $381.8 million for H1 2025 (vs. $1.78 billion loss in H1 2024), primarily due to a $334.4 million gain on equity securities Income Statement Summary (in millions, except per share data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $651.6 | $638.5 | $1,237.0 | $1,249.3 | | Gross profit | $345.3 | $355.1 | $651.3 | $681.1 | | Income from operations | $77.1 | $101.5 | $100.8 | $146.2 | | (Gains) losses from change in fair market value of equity securities | ($334.4) | $2,895.4 | ($366.2) | $2,473.2 | | Net income (loss) | $317.8 | ($2,165.5) | $381.8 | ($1,781.6) | | Net income (loss) per diluted share | $11.67 | ($76.26) | $13.84 | ($62.61) | Condensed Consolidated Statements of Cash Flows Net cash from operations increased to $246.4 million for H1 2025, while cash used in investing activities rose to $112.5 million due to acquisitions, and financing activities used $234.0 million primarily for share repurchases Six-Month Cash Flow Summary (in millions) | Cash Flow Activity | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $246.4 | $167.4 | | Net cash used in investing activities | ($112.5) | ($74.0) | | Net cash used in financing activities | ($234.0) | ($96.6) | | Net (decrease) in cash | ($118.1) | $3.3 | - The increase in cash used for investing activities was primarily due to a $216.7 million payment for acquisitions, net of cash received20 - The increase in cash used for financing activities was driven by payments for purchases of treasury stock, which rose to $242.1 million from $105.7 million in the prior-year period20 Notes to Condensed Consolidated Financial Statements Key notes detail the $257.9 million acquisition of Stilla Technologies, a $355.7 million gain on the Sartorius AG investment, and $37.4 million in restructuring expenses, with revenue growth in Americas and EMEA but decline in APAC - On June 30, 2025, the company acquired Stilla Technologies for $257.9 million to strengthen its droplet digital PCR offerings, with $161.9 million allocated to goodwill495254 - The company recognized a gain of $355.7 million for the first six months of 2025 from the change in fair market value of its investment in Sartorius AG65 - A new restructuring plan approved in February 2025 resulted in $37.4 million of restructuring-related expenses in H1 2025, primarily for employee termination benefits103 Revenue by Geographic Region (in millions) | Region | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | United States | $508.6 | $507.1 | +0.3% | | EMEA | $417.0 | $406.7 | +2.5% | | APAC | $230.5 | $248.4 | -7.2% | | Other | $80.9 | $87.1 | -7.1% | | Total | $1,237.0 | $1,249.3 | -1.0% | Management's Discussion and Analysis of Financial Condition and Results of Operations Management reports a 2.1% increase in Q2 2025 net sales driven by Life Science, while H1 2025 net sales decreased 1.0%, with gross margins declining due to higher costs, and the company maintains a strong $1.4 billion liquidity position despite biopharma and China market challenges Results of Operations Q2 2025 net sales grew 2.1% to $651.6 million, with Life Science sales up 4.9%, while H1 2025 net sales decreased 1.0% to $1.24 billion, and gross margin declined to 53.0% due to higher costs, offset by a $334.4 million gain on equity securities Q2 2025 vs Q2 2024 Performance | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $651.6M | $638.5M | +2.1% | | Life Science Sales | $262.8M | $250.5M | +4.9% | | Clinical Diagnostics Sales | $388.8M | $388.0M | +0.2% | | Gross Margin | 53.0% | 55.6% | -2.6 p.p. | - The increase in Life Science sales was driven by process chromatography and food safety products128 - The decrease in consolidated gross margin was primarily driven by higher material costs and reduced fixed manufacturing absorption130142 - The significant positive swing in net income was primarily due to a $326.6 million gain on the company's investment in Sartorius AG in Q2 2025, compared to a $2.9 billion loss in Q2 2024135 Liquidity and Capital Resources The company maintains a strong liquidity position with $1.4 billion in cash and investments, with net cash from operations at $246.4 million for H1 2025, and sufficient liquidity to meet future objectives - As of June 30, 2025, the company had $1.4 billion in cash, cash equivalents, and short-term investments151 - During the first six months of 2025, the company repurchased 992,803 shares of Class A common stock for $242.1 million156 - As of June 30, 2025, $337.4 million remained available for repurchases under the 2023 Share Repurchase Program156 Quantitative and Qualitative Disclosures about Market Risk No material changes have occurred in market risk disclosures since the Annual Report on Form 10-K for the year ended December 31, 2024 - There have been no material changes in market risk disclosures during the six months ended June 30, 2025158 Controls and Procedures Management concluded that disclosure controls and procedures were effective, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that disclosure controls and procedures were effective at a reasonable assurance level160 - No material changes to internal control over financial reporting were identified during the quarter ended June 30, 2025161 Part II - Other Information Legal Proceedings The company is involved in various legal proceedings but does not expect them to have a material adverse effect on its financial position, results, or liquidity - The company is involved in various legal proceedings from the ordinary course of business but does not expect them to have a material adverse effect163 Risk Factors The company faces significant risks from international operations, intense competition, product development, global economic and geopolitical uncertainties, supply chain disruptions, IT security, currency fluctuations, Sartorius AG investment volatility, regulatory changes, and concentrated voting power - International operations, accounting for 59% of net sales, expose the company to complex foreign laws, trade barriers, and currency fluctuations165179 - Changes in the market value of the company's investment in Sartorius AG materially impact financial results and could cause the company's share price to change independent of its operational performance180181 - Global economic conditions, including inflation, conflicts in Ukraine and the Middle East, and moderating growth in China, could adversely affect operations and demand171 - The company is subject to substantial government regulation (e.g., by the FDA and under the EU IVDR), and changes could adversely affect the business192195 - The Schwartz family holds a significant majority of voting stock, allowing them to elect a majority of directors and control matters affecting the company225 Unregistered Sales of Equity Securities and Use of Proceeds The company details its Q2 2025 share repurchase activity, with $337.4 million remaining available under the 2023 Share Repurchase Program as of June 30, 2025 Share Repurchases - Q2 2025 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | 422,648 | $234.43 | | May 2025 | — | — | | June 2025 | 170,860 | $232.51 | - As of June 30, 2025, $337.4 million remained available for repurchases under the 2023 Share Repurchase Program228230 Defaults Upon Senior Securities No defaults upon senior securities were reported - None231 Mine Safety Disclosures This section is not applicable to the company's operations - Not applicable232 Other Information No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the second quarter of 2025 - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the quarter233 Exhibits This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL data files