LANDAUER INC GLENWOOD, Ill., Dec. 14, 2016 /PRNewswire/ -- Landauer, Inc. (NYSE: LDR), a recognized leader in personal and environmental radiation measurement and monitoring and outsourced medical physics services, today reported financial results for its fiscal 2016 full year and fourth quarter ended September 30, 2016 and provided guidance for Fiscal 2017.
Fiscal 2016 and Fourth Quarter Highlights
-- Fiscal 2016 reported revenue of $149.2 million
-- Excluding the divested Medical Products and Radon businesses, pro
forma revenue of $143.3 million increased 4.8% compared to the prior
year
-- Fiscal 2016 reported net income of $17.8 million and earnings per
diluted share of $1.85
-- Fiscal 2016 adjusted net income of $18.4 million, or $1.92 per
diluted share, exceeds top end of guidance of $17.5 million
-- Reported fourth quarter earnings per diluted share of $0.26, includes
negative tax impact of the divested Medical Products business
-- Fourth quarter adjusted earnings per diluted share of $0.44
-- Full-year debt reduction of $24 million, an 18% reduction
-- Full remediation of prior year material weaknesses completed
Mike Kaminski, President and Chief Executive Officer of Landauer stated, "Our Fiscal 2016 results continue to demonstrate the strong progress and transformation occurring at Landauer. Throughout the year, we successfully streamlined our core business and made significant progress on the development of our Verifii digital dosimetry platform, passing a number of key technical milestones and beginning our initial rollout of customer field testing. Looking ahead to 2017, we expect demand for our imaging physics and informatics solutions to drive increased recurring revenue and we will continue to be squarely focused on executing our strategic growth plan by making the investments in R&D and marketing necessary to support the launch of our Verifii platform."
Fiscal Year Ended September 30, 2016 Financial Overview
Revenues for fiscal 2016 were $149.2 million, a 1.4% decrease compared to $151.3 million for fiscal 2015. Excluding the divested Medical Products and Radon businesses, total revenues increased $6.6 million, or 4.8%, compared to the prior year period. Domestic Radiation Measurement services revenues increased 2.4%, and revenues in the Medical Physics segment increased $3.8 million, or 10.7%, due to strong demand for imaging services.
Operating income for fiscal 2016 was $26.6 million, a 12.4% increase compared to operating income of $23.7 million for the fiscal 2015. Excluding the operating income from the divested Medical Products and Radon businesses, operating income increased $4.4 million, or 20.9%, compared to the prior year period. The increase in operating income was driven by higher margin sales coupled with a decrease in reorganization expenses and selling, general and administrative expenses.
Fourth Quarter Financial Overview
Revenues for the fourth fiscal quarter of 2016 were $36.8 million, an 8.4% decrease compared to revenues of $40.2 million for the fourth fiscal quarter of 2015. Excluding the divested Medical Products and Radon businesses, total revenues decreased $0.2 million compared to the prior year period. As expected given the timing of military sales, Radiation Measurement revenues for the quarter decreased to $26.5 million from $28.1 million for the fourth fiscal quarter of 2015. There were no military sales in the fourth fiscal quarter of 2016 compared to approximately $2 million in the fourth fiscal quarter of 2015. Medical Physics revenues increased $0.8 million, or 8.5%, to $10.3 million, due to strong demand for imaging services.
Operating income for the fourth fiscal quarter of 2016 was $5.5 million, compared to operating income of $6.8 million for the fourth fiscal quarter of 2015. Excluding the operating income from the divested Medical Products and Radon businesses, operating income decreased $0.9 million compared to the prior year period due to the timing of military sales.
Fiscal 2017 Outlook
The Company anticipates fiscal 2017 revenues in the range of $149 million to $154 million, representing a 4% to 7% increase compared to the fiscal 2016 Comparable Revenues. The Company anticipates diluted earnings per share in the range of $1.65 to $1.71, representing a 1% to 5% increase versus the fiscal 2016 Comparable Diluted EPS.
Reflected in this outlook is an expectation that the Company will make meaningful investments in fiscal 2017 as it prepares for the launch of its next generation Verifii platform. The Company expects additional R&D spending and marketing and operations expenses of approximately $2 million to support the launch. In addition, the Company's diluted earnings per share forecast in fiscal 2017 includes non-cash stock compensation expense of $3.1 million as it continues to shift its incentive compensation program more heavily towards longer-term, performance based awards.
Previously, the Company's fiscal 2016 earnings outlook was based on a non-GAAP measure, adjusted net income. Adjusted net income excluded the impact of stock compensation expense and non-recurring gains and losses.
In order to provide comparable fiscal 2016 revenues and earnings per diluted share, please refer to the following table:
FY2016 Revenues, As Reported $149.2 million
Less: Decrease from divested
businesses (5.9) million
-------------
FY2016 Comparable Revenues $143.3 million
FY2016 Net Income, As Reported $17.8 million
Add: Non-recurring expenses, net
of tax 0.5 million
Less: Gain on divestiture (1.9) million
Less: Net income from divested
businesses (0.9) million
-------------
FY2016 Comparable Net Income $15.5 million
FY2016 Comparable Diluted EPS $1.63
Use of Non-GAAP Financial Measures
Management believes the disclosure of certain non-GAAP financial measures enhances investor understanding of our financial performance. Non-GAAP financial measures disclosed in this report include: Adjusted EBITDA, Adjusted Net Income, Pro Forma Revenue, Pro Forma Operating Income and Adjusted Earnings per Diluted Share.
Adjusted EBITDA is presented here not as an alternative to net income, but rather as a measure of the Company's operating performance and is not intended to be a presentation in accordance with GAAP. Since EBITDA (generally, net income plus interest expenses, taxes, depreciation and amortization) is not calculated identically by all companies, this presentation may not be comparable to EBITDA or Adjusted EBITDA presentations disclosed by other companies. Adjusted EBITDA represents net income with adjustments for net financing costs, depreciation and amortization, provision for income taxes, stock compensation expense, goodwill and other intangible assets impairments, and acquisition, reorganization and nonrecurring costs. Management believes that Adjusted EBITDA is useful in evaluating the Company's operating performance compared to that of other companies in its industry because the calculation of Adjusted EBITDA generally eliminates the effects of certain non-cash and other items that may vary for different companies for reasons unrelated to overall operating performance.
In addition, the Company's management used Adjusted Net Income as a measure of earnings to eliminate the effects of certain non-cash and nonrecurring items of the Company. Adjusted Net Income and Adjusted Earnings per Diluted Share represents net income with tax-effected adjustments for stock compensation expense, goodwill and other intangible assets impairments and acquisition, reorganization and nonrecurring costs.
The Pro Forma Revenue and Pro Forma Operating Income measures exclude the Medical Products business, which was divested in May 2016, and the Radon business, which was divested in September 2015, and the negative impact of foreign currency. As we operate in various foreign countries where the local currency may strengthen or weaken significantly versus the U.S. dollar or other currencies used in operations, we utilize these pro forma measures as an additional metric to evaluate the underlying performance of each business without consideration of foreign currency movements.
These financial measures are not recognized measurements under GAAP and should not be considered as an alternative to the most directly comparable measures presented in accordance with GAAP. A reconciliation of these non-GAAP measures to the most directly comparable GAAP measures is included within this news release.
Conference Call Details
Landauer has scheduled its full-year and fourth quarter conference call for investors over the Internet on Wednesday, December 14, 2016, at 4:00 p.m. Central Time (5:00 p.m. Eastern Time). To participate, callers should dial 866-866-1542 (within the United States and Canada), or 707-294-1539 (international callers), passcode 34771026, about 10 minutes before the presentation. To listen to a webcast on the Internet, please go to the Company's website at http://www.landauer.com at least 15 minutes early to register, download and install any necessary audio software. Investors may access a replay of the call by dialing 855-859-2056 (within the United States and Canada), or 404-537-3406 (international callers), passcode 34771026, which will be available through Friday, January 13, 2017. The replay will also be available on Landauer's website for 30 days following the call.
About Landauer
Landauer is a leading global provider of technical and analytical services to determine occupational and environmental radiation exposure, as well as the leading domestic provider of outsourced medical physics services. For more than 50 years, the Company has provided complete radiation dosimetry services to hospitals, medical and dental offices, universities, national laboratories, nuclear facilities and other industries in which radiation poses a potential threat to employees. Landauer's services include the manufacture of various types of radiation detection monitors, the distribution and collection of the monitors to and from customers, and the analysis and reporting of exposure findings. The Company provides its dosimetry services to approximately 1.8 million individuals globally. In addition, through its Medical Physics segment, the Company provides therapeutic and imaging physics services to the medical physics community. For information about Landauer, please visit their website at http://www.landauer.com.
Safe Harbor Statement
Some of the information shared here (including, in particular, the section titled "Fiscal 2017 Outlook") constitutes forward-looking statements that are based on assumptions and involve certain risks and uncertainties. These include the following, without limitation: assumptions, risks and uncertainties associated with the Company's future performance; the Company's development and introduction of new technologies in general; the ability to protect and utilize the Company's intellectual property; continued customer acceptance of the InLight technology; the adaptability of optically stimulated luminescence (OSL) technology to new platforms and formats; military and other government funding for the purchase of certain of the Company's equipment and services; the impact on sales and pricing of certain customer group purchasing arrangements; changes in spending or reimbursement for medical products or services; the costs associated with the Company's research and business development efforts; the usefulness of older technologies and related licenses and intellectual property; the effectiveness of and costs associated with the Company's IT platform enhancements; the anticipated results of operations of the Company and its subsidiaries or joint ventures; valuation of the Company's long-lived assets or reporting units relative to future cash flows; changes in pricing of services and products; changes in postal and delivery practices; the Company's business plans; anticipated revenue and cost growth; the ability to integrate the operations of acquired businesses and to realize the expected benefits of acquisitions; the risks associated with conducting business internationally; costs incurred for potential acquisitions or similar transactions; other anticipated financial events; the effects of changing economic and competitive conditions, including instability in capital markets which could impact availability of short and long-term financing; the timing and extent of changes in interest rates; the level of borrowings; foreign exchange rates; government regulations; accreditation requirements; changes in the trading market that affect the costs of obligations under the Company's benefit plans; and pending accounting pronouncements. These assumptions may not materialize to the extent assumed, and risks and uncertainties may cause actual results to be different from what is anticipated today. These risks and uncertainties also may result in changes to the Company's business plans and prospects, and could create the need from time to time to write down the value of assets or otherwise cause the Company to incur unanticipated expenses. Additional information may be obtained by reviewing the information set forth in Item 1A. "Risk Factors" and Item 7A. "Quantitative and Qualitative Disclosures about Market Risk" and information contained in the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2016 and other reports filed by the Company, from time to time, with the Securities and Exchange Commission. The Company does not undertake, and expressly disclaims, any duty to update any forward-looking statement whether as a result of new information, future events or changes in the Company's expectations, except as required by law.
Financial Tables Follow
Landauer, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
(Dollars in Thousands) September 30, September 30,
2016 2015
------------- -------------
Assets
Cash and cash equivalents $13,285 $15,314
Receivables, net of allowances of $1,296 in
2016 and $1,556 in 2015 31,998 32,412
Inventories 5,670 7,035
Prepaid expenses and other current assets 5,049 6,992
----- -----
Total current assets 56,002 61,753
------ ------
Property, plant and equipment, net 46,417 46,367
Equity in joint ventures 26,174 24,010
Goodwill 33,807 35,072
Intangible assets, net of accumulated
amortization of $11,772 in 2016 and
$38,662 in 2015 9,297 13,052
Other assets 19,119 28,490
------ ------
Total assets $190,816 $208,744
======== ========
Liabilities
Total current liabilities $34,498 $38,493
Long-term debt 109,100 133,385
Other non-current liabilities 26,619 24,539
------ ------
Total liabilities 170,217 196,417
------- -------
Stockholders' equity
Landauer, Inc. stockholders' equity 19,178 11,195
Noncontrolling interest 1,421 1,132
----- -----
Total stockholders' equity 20,599 12,327
------ ------
Total Liabilities and Stockholders' Equity $190,816 $208,744
======== ========
Landauer, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations (Unaudited)
Three Months Ended Twelve Months Ended
September 30, September 30,
------------- -------------
(Dollars in Thousands, Except per Share) 2016 2015 2016 2015
---- ---- ---- ----
Total revenues $36,773 $40,161 $149,239 $151,314
Cost and expenses:
Cost of sales 19,083 19,402 73,761 72,585
Selling, general and administrative expense 12,231 12,901 48,837 53,989
Acquisition and reorganization costs - 1,041 - 1,041
--- ----- --- -----
Total costs and expenses 31,314 33,344 122,598 127,615
------ ------ ------- -------
Operating income 5,459 6,817 26,641 23,699
Equity in income of joint ventures 686 503 1,483 2,307
Other expense, net (500) (1,611) 229 (4,684)
---- ------ --- ------
Income before taxes 5,645 5,709 28,353 21,322
Income tax expense 2,825 3,002 9,899 6,273
----- ----- ----- -----
Net income 2,820 2,707 18,454 15,049
Less: Net income attributed to noncontrolling interest 254 143 701 506
--- --- --- ---
Net income attributed to Landauer, Inc. $2,566 $2,564 $17,753 $14,543
====== ====== ======= =======
Net income per share attributable to Landauer, Inc. shareholders:
Basic $0.27 $0.27 $1.86 $1.52
===== ===== ===== =====
Weighted average basic shares outstanding 9,532 9,533 9,526 9,511
Diluted $0.26 $0.27 $1.85 $1.52
===== ===== ===== =====
Weighted average diluted shares outstanding 9,584 9,570 9,569 9,540
Adjusted Diluted $0.44 $0.41 $1.92 $1.78
===== ===== ===== =====
Landauer, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)
Twelve Months Ended
September 30,
-------------
(Dollars in Thousands) 2016 2015
---- ----
Cash flows from operating
activities:
Net income $18,454 $15,049
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Depreciation and
amortization 11,072 12,312
Equity in income of joint
ventures (1,483) (2,307)
Dividends from joint
ventures 1,195 1,144
Stock-based compensation
and related net tax
benefits 2,841 1,583
Current and long-term
deferred taxes, net 9,150 238
(Gain) loss on disposition
of business (4,131) 366
Loss on sale, disposal and
abandonment of fixed
assets 705 181
(Gain) loss on investments (754) 176
Changes in operating assets
and liabilities (5,509) (489)
------ ----
Net cash provided by
operating activities 31,540 28,253
------ ------
Net cash provided by (used
in) investing activities 1,779 (2,278)
Cash flows from financing
activities:
Long-term borrowings, net (24,285) (200)
Dividends paid to
stockholders (10,574) (15,874)
Other financing activities,
net (420) (449)
---- ----
Net cash used in financing
activities (35,279) (16,523)
------- -------
Effects of foreign currency
translation (69) (899)
--- ----
Net (decrease) increase in
cash and cash equivalents (2,029) 8,553
Opening balance -cash and
cash equivalents 15,314 6,761
------ -----
Ending balance -cash and
cash equivalents $13,285 $15,314
======= =======
Non-GAAP Financial Measures
A reconciliation of Adjusted EBITDA and Adjusted Net Income, Pro Forma Revenue and Pro Forma Operating Income (i.e., non-GAAP financial measures) to the most directly comparable GAAP measures is provided below:
Three Months Ended Twelve Months Ended
September 30, September 30,
------------- -------------
(Unaudited, Dollars in Thousands) 2016 2015 2016 2015
---- ---- ---- ----
Adjusted EBITDA
Net income attributed to Landauer, Inc. $2,566 $2,564 $17,753 $14,543
Add back:
Net financing costs 571 1,258 2,991 3,910
Depreciation and amortization 2,609 3,038 11,072 12,312
Provision for income taxes 2,825 3,002 9,899 6,273
----- ----- ----- -----
Earnings before interest, taxes, depreciation and amortization
(EBITDA) $8,571 $9,862 $41,715 $37,038
------ ------ ------- -------
Adjustments:
Non-cash stock based compensation 793 160 2,841 1,583
(Gain) loss on disposition of business - 366 (4,131) 366
Lease termination expenses - - 518 -
Transaction expenses - 528 240 528
Acquisition and reorganization costs - 1,041 - 1,041
--- ----- --- -----
Sub-total adjustments 793 2,095 (532) 3,518
--- ----- ---- -----
Adjusted EBITDA $9,364 $11,957 $41,183 $40,556
====== ======= ======= =======
Three Months Ended Twelve Months Ended
September 30, September 30,
------------- -------------
(Unaudited, Dollars in Thousands) 2016 2015 2016 2015
---- ---- ---- ----
Adjusted Net Income
Net income attributed to Landauer, Inc. $2,566 $2,564 $17,753 $14,543
------ ------ ------- -------
Sub-total adjustments 793 2,095 (532) 3,518
Income taxes on adjustments 854 (758) 1,155 (1,035)
--- ---- ----- ------
Adjustments, net 1,647 1,337 623 2,483
----- ----- --- -----
Adjusted Net Income $4,213 $3,901 $18,376 $17,026
====== ====== ======= =======
Three Months Ended Twelve Months Ended
September 30, September 30,
------------- -------------
(Unaudited, Dollars in Thousands) 2016 2015 2016 2015
---- ---- ---- ----
Pro Forma Revenue
Total Revenues, as reported $36,773 $40,161 $149,239 $151,314
------- ------- -------- --------
Less:
Medical Products adjustment - (2,585) (5,802) (9,887)
Radon adjustment (27) (641) (117) (4,678)
--- ---- ---- ------
Total Revenues, pro forma $36,746 $36,935 $143,320 $136,749
======= ======= ======== ========
Three Months Ended Twelve Months Ended
September 30, September 30,
------------- -------------
(Unaudited, Dollars in Thousands) 2016 2015 2016 2015
---- ---- ---- ----
Pro Forma Operating Income
Operating Income, as reported $5,459 $6,817 $26,641 $23,699
------ ------ ------- -------
Less:
Medical Products adjustment - (581) (1,062) (1,534)
Radon adjustment (27) 38 (117) (1,091)
--- --- ---- ------
Total Operating Income, pro forma $5,432 $6,274 $25,462 $21,074
====== ====== ======= =======
Segment Information
The following tables summarize financial information for each reportable segment for the three and twelve months ended September 30:
(Unaudited, Dollars in Thousands) Three Months Ended Twelve Months Ended
September 30, September 30,
------------- -------------
Revenues by segment: 2016 2015 2016 2015
---- ---- ---- ----
Radiation Measurement $26,487 $28,098 $104,203 $105,978
Medical Physics 10,286 9,478 39,234 35,449
Medical Products - 2,585 5,802 9,887
--- ----- ----- -----
Consolidated revenues 36,773 40,161 149,239 151,314
------ ------ ------- -------
(Unaudited, Dollars in Thousands) Three Months Ended Twelve Months Ended
September 30, September 30,
------------- -------------
Operating income (loss) by segment:
Radiation Measurement $8,692 $9,239 $37,853 $35,641
Medical Physics 749 1,044 3,201 3,126
Medical Products - 581 1,063 1,534
Corporate (3,982) (4,047) (15,476) (16,602)
------ ------ ------- -------
Consolidated operating income (loss) 5,459 6,817 26,641 23,699
----- ----- ------ ------
For Further Information Contact:
Michael DeGraff
Sard Verbinnen & Co
Phone: 312.895.4734
Email: mdegraff@sardverb.com
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SOURCE Landauer, Inc.
