BIO-TECHNE Corp

Previous wording

A key component of the Company's strategy is to augment internal growth at existing businesses with complementary acquisitions. The Company did not make any acquisitions in the first half of fiscal 2025.

Current wording

A key component of the Company's strategy is to augment internal growth at existing businesses with complementary acquisitions. The Company did not make any acquisitions in the first nine months of fiscal 2025.

Previous wording

Consolidated net sales increased 9% and 7% for the quarter and six months ended December 31, 2024, respectively, compared to the same prior year periods. Organic revenue for the quarter ended December 31, 2024 increased 9% compared to the prior year. Foreign currency exchange and a business held-for-sale did not have a material impact. Organic revenue for the six months ended December 31, 2024 increased 7% compared to the same prior year period. Foreign currency exchange and a business held-for-sale did not have a material impact.

Current wording

Consolidated net sales increased 4% and 6% for the quarter and nine months ended March 31, 2025, respectively, compared to the same prior year periods. Organic revenue for the quarter ended March 31, 2025 increased 6% compared to the prior year. Foreign currency exchange and a business held-for-sale each had unfavorable impacts of 1%. Organic revenue for the nine months ended March 31, 2025 increased 6% compared to the same prior year period. Foreign currency exchange and a business held-for-sale did not have a material impact.

Previous wording

Consolidated net earnings increased to $34.9 million for the quarter ended December 31, 2024 as compared to $27.5 million for the quarter ended December 31, 2023. The increase in net earnings is primarily due to favorable volume leverage and a non-recurring prior year impairment of a business held-for-sale. Consolidated net earnings decreased to $68.5 million for the six months ended December 31, 2024 as compared to $78.5 million for the six months ended December 31, 2023. The decrease in net earnings is primarily due to restructuring and restructuring-related costs.

Current wording

Consolidated net earnings decreased to $22.6 million for the quarter ended March 31, 2025 as compared to $49.1 million for the quarter ended March 31, 2024. The decrease in net earnings is primarily due to a non-recurring arbitration award. Consolidated net earnings decreased to $91.1 million for the nine months ended March 31, 2025 as compared to $127.5 million for the nine months ended March 31, 2024. The decrease in net earnings is primarily due to a non-recurring arbitration award and restructuring and restructuring-related costs.

Previous wording

Consolidated net sales for the quarter ended December 31, 2024 increased 9% at $297.0 million compared to the same prior year period. Consolidated net sales for the six months ended December 31, 2024 were $586.5 million, an increase of 7% from the same prior year period. Organic revenue for the quarter ended December 31, 2024 increased 9% compared to the prior year. Foreign currency exchange and a business held-for-sale did not have a material impact. Organic revenue for the six months ended December 31, 2024 increased 7% compared to the prior year same period. Foreign currency exchange and a business held-for-sale did not have a material impact. Organic revenue for the quarter and six months ended December 31, 2024 was primarily driven by broad based performance of our Diagnostics and Spatial Biology portfolio as well as improving biopharma end market conditions and continued uptake of our cell and gene therapy workflow solutions in our Protein Sciences segment.

Current wording

Consolidated net sales for the quarter ended March 31, 2025 increased 4% to $316.2 million compared to the same prior year period. Consolidated net sales for the nine months ended March 31, 2025 were $902.7 million, an increase of 6% from the same prior year period. Organic revenue for the quarter ended March 31, 2025 increased 6% compared to the prior year. Foreign currency exchange and a business held-for-sale each had an unfavorable impact of 1%. Organic revenue for the nine months ended March 31, 2025 increased 6% compared to the prior year same period. Foreign currency exchange and a business held-for-sale did not have a material impact. Organic revenue for the quarter ended March 31, 2025 improved primarily due to improving pharma end markets driving volume growth in our Protein Sciences segment. Orgranic revenue for the nine months ended March 31, 2025 was driven by broad based performance of our Diagnostics and Spatial Biology portfolio, continued uptake of our cell and gene therapy workflow solutions, and improving pharma end market conditions for our Protein Sciences segment.

Previous wording

Consolidated gross margins for the quarter and six months ended December 31, 2024 were 65.3% and 64.3%, respectively, compared to 64.8% and 65.8% for the same prior year periods. Under purchase accounting, inventory is valued at fair value less expected selling and marketing costs, resulting in reduced margins in future periods as the inventory is sold. Excluding the impact of costs recognized upon the sale of acquired inventory, amortization of intangibles, stock-based compensation expense, restructuring and restructuring-related expenses, and the impact of a business held-for-sale, adjusted gross margins for the quarter and six months ended December 31, 2024 were 70.5% and 70.0%, respectively, compared to 69.7% and 70.5% for the quarter and six months ended December 31, 2023, respectively. Fluctuations in consolidated gross margin and adjusted gross margin, as a percentage of sales, have primarily resulted from changes in product mix. We expect that, in the future, gross margins will continue to be impacted by the mix of our portfolio growing at different rates as well as future acquisitions.

Current wording

Consolidated gross margins for the quarter and nine months ended March 31, 2025 were 67.9% and 65.5%, respectively, compared to 67.4% and 66.4% for the same prior year periods. Under purchase accounting, inventory is valued at fair value less expected selling and marketing costs, resulting in reduced margins in future periods as the inventory is sold. Excluding the impact of costs recognized upon the sale of acquired inventory, amortization of intangibles, stock-based compensation expense, restructuring and restructuring-related expenses, and the impact of a business held-for-sale, adjusted gross margins for the quarter and nine months ended March 31, 2025 were 71.6% and 70.6%, respectively, compared to 71.9% and 71.0% for the quarter and nine months ended March 31, 2024, respectively. Fluctuations in consolidated gross margin and adjusted gross margin, as a percentage of sales, have primarily resulted from changes in product mix. We expect that, in the future, gross margins will continue to be impacted by the mix of our portfolio growing at different rates as well as future acquisitions.

Previous wording

Selling, general and administrative expenses increased 5% to $121.5 million and increased 9% to $240.6 million for the quarter and six months ended December 31, 2024, respectively, from the same prior year periods. The increase in expense for the quarter and six months ended December 31, 2024 was primarily due to restructuring and restructuring-related charges, and the re-instatement of incentive compensation accruals, partially offset by cost management initiatives.

Current wording

Selling, general and administrative expenses increased 35% to $151.3 million and increased 18% to $391.9 million for the quarter and nine months ended March 31, 2025, respectively, from the same prior year periods. The increase in expense for the quarter and nine months ended March 31, 2025 was primarily due to a non-recurring arbitration award, restructuring and restructuring-related charges, and the re-instatement of incentive compensation accruals, partially offset by cost management initiatives.

Previous wording

Protein Sciences’ net sales for the quarter and six months ended December 31, 2024 were $211.6 million and $416.1 million, respectively, with results increasing 7% and 3%, respectively, compared to the same respective prior year periods. As of December 31, 2023, a business within the Protein Sciences Segment met the criteria as held-for-sale; this held-for-sale business has been excluded from the segment’s fiscal 2025 operating results. The exclusion of fiscal 2025 sales related to this business held-for-sale reduced sales by 1% and 1% for the quarter and six months ended December 31, 2024, respectively. Organic revenue for the segment increased 8% and foreign currency exchange did not have a material impact for the quarter ended December 31, 2024. Organic growth for the segment increased 4% for the six months ended December 31, 2024. Foreign currency exchange did not have a material impact.

Current wording

Protein Sciences’ net sales for the quarter and nine months ended March 31, 2025 were $227.7 million and $643.8 million, respectively, with results increasing 6% and 4%, respectively, compared to the same respective prior year periods. As of December 31, 2023, a business within the Protein Sciences Segment met the criteria as held-for-sale; this held-for-sale business has been excluded from the segment’s fiscal 2025 and third quarter fiscal 2024 operating results. The exclusion of fiscal 2025 sales related to this business held-for-sale reduced sales by 1% for the nine months ended March 31, 2025. The exclusion of third quarter fiscal 2024 sales related to the business held-for-sale reduced sales by 1% and had an immaterial impact for the nine months ended March 31, 2024. Organic revenue for the segment increased 7% and foreign currency exchange had an unfavorable impact of 1% for the quarter ended March 31, 2025. Organic growth for the segment increased 5% for the nine months ended March 31, 2025 with foreign currency exchange not having a material impact.

Previous wording

The operating margin was 41.2% and 40.3% for the quarter and six months ended December 31, 2024, respectively, compared to 40.3% and 41.7% in both comparative prior year periods. The segment’s operating margin was impacted by volume leverage offset by re-instatement of incentive compensation accruals.

Current wording

The operating margin was 45.6% and 42.2% for the quarter and nine months ended March 31, 2025, respectively, compared to 44.2% and 42.6% in both comparative prior year periods. The segment’s operating margin was impacted by volume leverage partially offset by re-instatement of incentive compensation accruals.

Previous wording

Diagnostics and Spatial Biology’s net sales for the quarter and six months ended December 31, 2024 were $84.1 million and $167.3 million, respectively, with increased net sales of 12% and 13% compared to the same respective prior year periods. Organic growth for the segment for the quarter ended December 31, 2024 was 12% from the prior year, with foreign currency exchange not having a material impact. Organic revenue growth for the six months ended December 31, 2024 was 13% compared to the prior year, with foreign currency exchange not having a material impact.

Current wording

Diagnostics and Spatial Biology’s net sales for the quarter and nine months ended March 31, 2025 were $89.2 million and $256.6 million, respectively, with increased net sales of 2% and 9% compared to the same respective prior year periods. Organic growth for the segment for the quarter ended March 31, 2025 was 2% from the prior year, with foreign currency exchange not having a material impact. Organic revenue growth for the nine months ended March 31, 2025 was 9% compared to the prior year, with foreign currency exchange not having a material impact.

Previous wording

The operating margin for the segment was 3.9% and 4.5% for the quarter and six months ended December 31, 2024, respectively, compared to 6.0% and 3.4% in both comparative prior year periods. The segment’s operating margin was impacted by volume leverage offset by re-instatement of incentive compensation accruals.

Current wording

The operating margin for the segment was 9.4% and 6.2% for the quarter and nine months ended March 31, 2025, respectively, compared to 9.3% and 5.6% in both comparative prior year periods. The segment’s operating margin was favorably impacted by volume leverage mostly offset by re-instatement of incentive compensation accruals and product mix.

Previous wording

Income taxes were at an effective rate of 18.6% and 17.5% of consolidated earnings for the quarter and six month period ended December 31, 2024, respectively, compared to 17.7% and 5.4% for the same respective prior year periods. The change in the Company’s tax rate for the quarter and six months ended December 31, 2024 was driven by the composition and amount of net income across periods and the impact of discrete tax benefits of $2.2 million and $5.2 million, respectively, compared to prior year discrete tax benefits of $2.8 million and $16.3 million as further discussed in Note 12.

Current wording

Income taxes were at an effective rate of 41.0% and 24.9% of consolidated earnings for the quarter and nine months ended March 31, 2025, respectively, compared to 19.7% and 11.5% for the same respective prior year periods. The change in the Company’s tax rate for the quarter and nine months ended March 31, 2025 was driven by the composition and amount of net income across periods and the impact of discrete tax expenses of $7.5 million and $2.3 million, respectively, compared to prior year discrete tax benefits of $1.8 million and $16.6 million as further discussed in Note 12.

Previous wording

The forecasted tax rate as of the second fiscal quarter of 2025 before discrete items is 23.6% compared to the prior year forecasted tax rate before discrete items of 23.4%. Excluding the impact of discrete items, the Company expects the consolidated income tax rate for the remainder of fiscal 2025 to range from 23% to 27%.

Current wording

The forecasted tax rate as of the third fiscal quarter of 2025 before discrete items is 23.1% compared to the prior year forecasted tax rate before discrete items of 23.0%. Excluding the impact of discrete items, the Company expects the consolidated income tax rate for the remainder of fiscal 2025 to range from 23% to 27%.

Previous wording

Depending on the nature of discrete tax items, our reported tax rate may not be consistent on a period-to-period basis. The Company independently calculates a non-GAAP adjusted tax rate considering the impact of discrete items and jurisdictional mix of the identified non-GAAP adjustments. The following table summarizes the reported GAAP tax rate and the effective non-GAAP adjusted tax rate for the quarter and six months ended December 31, 2024 and December 31, 2023.

Current wording

Depending on the nature of discrete tax items, our reported tax rate may not be consistent on a period-to-period basis. The Company independently calculates a non-GAAP adjusted tax rate considering the impact of discrete items and jurisdictional mix of the identified non-GAAP adjustments. The following table summarizes the reported GAAP tax rate and the effective non-GAAP adjusted tax rate for the quarter and nine months ended March 31, 2025 and 2024.

Previous wording

Cash and cash equivalents and available-for-sale investments were $177.5 million as of December 31, 2024, compared to $152.9 million as of June 30, 2024. Included in the available-for-sale-investments as of June 30, 2024 were certificates of deposit that have maturity dates within one year of $1.1 million. During the first fiscal quarter of 2025, the certificates of deposit reached maturity. The Company had no available-for-sale investments as of December 31, 2024.

Current wording

Cash and cash equivalents and available-for-sale investments were $140.7 million as of March 31, 2025, compared to $152.9 million as of June 30, 2024. Included in the available-for-sale-investments as of June 30, 2024 were certificates of deposit that have maturity dates within one year of $1.1 million. During the first fiscal quarter of 2025, the certificates of deposit reached maturity. The Company had no available-for-sale investments as of March 31, 2025.

Previous wording

The Company has a line-of-credit governed by a Credit Agreement dated August 31, 2022 that will mature on August 31, 2027. As of December 31, 2024, there is $700 million available on the line-of-credit. See Note 6 to the Condensed Consolidated Financial Statements for a description of the Credit Agreement.

Current wording

The Company has a line-of-credit governed by a Credit Agreement dated August 31, 2022 that will mature on August 31, 2027. As of March 31, 2025, there is $670 million available on the line-of-credit. See Note 6 to the Condensed Consolidated Financial Statements for a description of the Credit Agreement.

Previous wording

During fiscal year 2022, the Company paid $25 million to enter into a two-part forward contract which requires the Company to purchase the full equity interest in Wilson Wolf if certain annual revenue or EBITDA thresholds are met. During fiscal year 2023, Wilson Wolf met the EBITDA target and the Company paid an additional $232 million to acquire 19.9% of Wilson Wolf. Since the first part of the forward contract has been triggered, the second part of the forward contract will automatically trigger, which requires the Company to acquire the remaining 80.1% of Wilson Wolf on December 31, 2027. The second part of the contract would be accelerated in advance of December 31, 2027 if Wilson Wolf meets certain financial milestones. As of December 31, 2024, the second milestones have not been met. The second option payment of approximately $1 billion plus potential contingent consideration is forecasted to occur between fiscal 2026 and fiscal 2028.

Current wording

During fiscal year 2022, the Company paid $25 million to enter into a two-part forward contract which requires the Company to purchase the full equity interest in Wilson Wolf if certain annual revenue or EBITDA thresholds are met. During fiscal year 2023, Wilson Wolf met the EBITDA target and the Company paid an additional $232 million to acquire 19.9% of Wilson Wolf. Since the first part of the forward contract has been triggered, the second part of the forward contract will automatically trigger, which requires the Company to acquire the remaining 80.1% of Wilson Wolf on December 31, 2027. The second part of the contract would be accelerated in advance of December 31, 2027 if Wilson Wolf meets certain financial milestones. As of March 31, 2025, the second milestones have not been met. The second option payment of up to $1 billion plus potential contingent consideration is forecasted to occur between fiscal 2026 and fiscal 2028.

Previous wording

The Company generated cash of $148.2 million from operating activities in the six months ended December 31, 2024 compared to $142.5 million in the six months ended December 31, 2023. The increase from the prior year was primarily due to favorable timing of payments on certain operating assets and liabilities.

Current wording

The Company generated cash of $189.4 million from operating activities in the nine months ended March 31, 2025 compared to $223.5 million in the nine months ended March 31, 2024. The decrease from the prior year was primarily due to decreased net earnings for the year.

Previous wording

Capital expenditures for fixed assets for the six months ended December 31, 2024 and December 31, 2023 were $16.0 million and $28.5 million, respectively. Capital expenditures for the remainder of fiscal 2025 are expected to be approximately $20 million. Capital expenditures are expected to be financed through currently available funds and cash generated from operating activities. Expected additions in fiscal 2025 are related to increasing capacity to meet expected sales growth across the Company.

Current wording

Capital expenditures for fixed assets for the nine months ended March 31, 2025 and 2024 were $26.1 million and $44.9 million, respectively. Capital expenditures for the remainder of fiscal 2025 are expected to be approximately $12 million. Capital expenditures are expected to be financed through currently available funds and cash generated from operating activities. Expected additions in fiscal 2025 are related to increasing capacity to meet expected sales growth across the Company.

Previous wording

During the six months ended December 31, 2024, the Company invested $15.0 million into Spear Bio. There was no comparable activity in fiscal 2024.

Current wording

During the nine months ended March 31, 2025, the Company invested $15.0 million into Spear Bio. There was no comparable activity in fiscal 2024.

Previous wording

During the first six months of 2025, certificates of deposit reached maturity for $1.1 million. In the first six months of 2024, the Company sold its exchange traded investment grade bond funds for $23.8 million.

Current wording

During fiscal 2025, certificates of deposit reached maturity for $1.1 million. In fiscal 2024, the Company sold its exchange traded investment grade bond funds for $23.8 million.

Previous wording

The Company received tax distributions of $1.4 million and $2.1 million from its equity method investee during the first quarter of 2025 and 2024, respectively.

Current wording

The Company received tax distributions of $2.7 million and $2.1 million from its equity method investee during the nine months ended March 31, 2025 and 2024, respectively.

Previous wording

During the six months ended December 31, 2024, the Company received $1.8 million for the purchase of assets held-for-sale. As part of the asset sale, the Company entered into a promissory note whereby the remainder of the funds will be received from the buyer in quarterly installments through fiscal 2027. There was no comparable activity in fiscal 2024.

Current wording

During the nine months ended March 31, 2025, the Company received $1.8 million from the sale of assets held-for-sale. As part of the asset sale, the Company entered into a promissory note whereby the remainder of the funds will be received from the buyer in quarterly installments through fiscal 2027. There was no comparable activity in fiscal 2024.

Previous wording

During the six months ended December 31, 2023, the Company paid $169.7 million to acquire Lunaphore Technologies SA. There was no comparable activity in fiscal 2025.

Current wording

During the nine months ended March 31, 2024, the Company paid $169.7 million to acquire Lunaphore Technologies SA. There was no comparable activity in fiscal 2025.

Previous wording

During the six months ended December 31, 2023, there was a purchase of available-for-sale investments for $5.5 million. There was no comparable activity in fiscal 2025.

Current wording

During the nine months ended March 31, 2024, there was a purchase of available-for-sale investments for $5.5 million. There was no comparable activity in fiscal 2025.

Previous wording

During the six months ended December 31, 2024 and December 31, 2023, the Company paid cash dividends of $25.4 million and $25.2 million, respectively, to all common shareholders. On February 5, 2025, the Company announced the payment of an $0.08 per share cash dividend, or approximately $12.6 million, will be payable February 28, 2025, to all common shareholders of record on February 17, 2025.

Current wording

During the nine months ended March 31, 2025 and 2024, the Company paid cash dividends of $38.0 million and $37.8 million, respectively, to all common shareholders. On May 7, 2025, the Company announced the payment of an $0.08 per share cash dividend, or approximately $12.5 million, will be payable May 30, 2025, to all common shareholders of record on May 19, 2025.

Previous wording

Cash of $30.6 million and $19.7 million was received during the six months ended December 31, 2024 and December 31, 2023, respectively, from the exercise of stock options.

Current wording

Cash of $45.5 million and $38.0 million was received during the nine months ended March 31, 2025 and 2024, respectively, from the exercise of stock options.

Previous wording

During the six months ended December 31, 2024 and December 31, 2023, the Company made repayments of $19.0 million and $128.0 million, respectively, on its long-term debt balance. The Company drew $225.0 million under its revolving line-of-credit facility during the six months ended December 31, 2023. There was no comparable activity in fiscal 2025.

Current wording

During the nine months ended March 31, 2025 and 2024, the Company made repayments of $27.0 million and $186.0 million, respectively, on its long-term debt balance. The Company drew $38.0 million and $225.0 million under its revolving line-of-credit facility during the nine months ended March 31, 2025 and 2024.

Previous wording

There were $75.6 million and $80.0 million of share repurchases during the six months ended December 31, 2024 and December 31, 2023, respectively, included as a cash outflow within financing activities.

Current wording

There were $175.7 million and $80.0 million of share repurchases during the nine months ended March 31, 2025 and 2024, respectively.

Previous wording

During the six months ended December 31, 2024 and December 31, 2023, the Company paid $6.0 million and $21.3 million related to taxes on restricted stock units and stock options exercised through net share settlements classified as financing activities.

Current wording

During the nine months ended March 31, 2025 and 2024, the Company paid $6.3 million and $21.5 million related to taxes on restricted stock units and stock options exercised through net share settlements classified as financing activities.

Previous wording

The Company's significant accounting policies are discussed in the Company's Annual Report on Form 10-K for fiscal 2024 and are incorporated herein by reference. The application of certain of these policies requires judgments and estimates that can affect the results of operations and financial position of the Company. Judgments and estimates are used for, but not limited to, valuation of available-for-sale investments, inventory valuation and allowances, valuation of intangible assets and goodwill and valuation of investments in unconsolidated entities. There have been no significant changes in estimates in the quarter or six months ended December 31, 2024 that would require disclosure nor have there been any changes to the Company's policies.

Current wording

The Company's significant accounting policies are discussed in the Company's Annual Report on Form 10-K for fiscal 2024 and are incorporated herein by reference. The application of certain of these policies requires judgments and estimates that can affect the results of operations and financial position of the Company. Judgments and estimates are used for, but not limited to, valuation of available-for-sale investments, inventory valuation and allowances, valuation of intangible assets and goodwill and valuation of investments in unconsolidated entities. There have been no significant changes in estimates in the quarter or nine months ended March 31, 2025 that would require disclosure nor have there been any changes to the Company's policies.