Bio-Techne ((TECH)) has held its Q2 earnings call. Read on for the main highlights of the call.
Discover the Best Stocks and Maximize Your Portfolio:
- See what stocks are receiving strong buy ratings from top-rated analysts.
- Filter, analyze, and streamline your search for investment opportunities with TipRanks’ Stock Screener.
In the recent earnings call, Bio-Techne reported a robust performance for the quarter, marked by significant growth in core operations and strategic expansions. Despite some challenges, notably in China and from foreign exchange impacts, the company expressed confidence in its ongoing growth trajectory and recovery in key markets.
Strong Fiscal Quarter Performance
Bio-Techne exceeded initial projections with a remarkable 9% organic revenue growth. This success was primarily driven by the strong performance in biopharma end markets and heightened demand for GMP AdHens in protein analytical instrumentation.
Increased Operating Margin
The company reported a sequential increase in adjusted operating margin by 110 basis points, reaching 30.1%. This improvement was attributed to enhanced organizational and operational efficiencies.
Expansion in EMEA and New Partnerships
Bio-Techne experienced low double-digit growth in the EMEA region, propelled by a 20% increase in its automated protein analysis portfolio. The company also expanded its geographical reach through new distribution agreements with LeaderLife Sciences and MedSomTec.
GMP Reagents Growth
The GMP reagents segment saw a revenue increase of over 90% this quarter, with a trailing twelve-month organic growth rate exceeding 40%.
Protein Analysis Growth
Instrument-specific consumables posted high teens growth, marking the eighth double-digit growth quarter out of the last nine. New instrument placements also contributed positively to this sector’s performance.
Spatial Biology and Precision Diagnostic Tools Growth
The spatial biology segment delivered 12% organic growth, bolstered by the launch of the comet system, which contributed to mid-teens revenue growth.
Strong Cash Flow and Shareholder Returns
Bio-Techne generated $84.3 million in cash from operations and returned $12.7 million in dividends. Additionally, the company executed a $75.6 million share stock buyback.
Decline in China Sales
Sales in China faced a low single-digit decline due to challenging economic conditions, which continue to pose a growth challenge.
Impact of Foreign Exchange
Foreign exchange rates negatively impacted adjusted EPS and are projected to remain a headwind, potentially affecting about 1% of sales in the second half of the fiscal year.
Challenges in NIH Funding
Concerns over NIH funding and administrative changes present potential challenges for future funding and growth in the academic market.
Forward-Looking Guidance
Looking ahead, Bio-Techne anticipates continued growth and margin expansion in the second half of the fiscal year, with a focus on strategic M&A opportunities. The company expects a return to growth in China and remains committed to innovation, particularly with the launch of new designer proteins.
In summary, Bio-Techne’s earnings call reflected a strong quarter with growth across several sectors and regions, despite some challenges. The company remains optimistic about its future, supported by strategic expansions and a focus on innovation.
