Harvard Bioscience, Inc. · NASDAQ:HBIO
Harvard Bioscience — Investor Presentation (March 2009)
28 slides from Harvard Bioscience's investor presentation, March 2009
Slide 1: Tools to Advance Life Science Research
Tools to Advance Life Science Research NASDAQ HBIO March 2009 Copyright © Harvard Bioscience 2009
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words “guidance,” “expects,” “plans,” “estimates,” “projects,” “intends,” “believes” and similar expressions that do not
Slide 3: Use of Non-GAAP Information
Use of Non-GAAP Information In this presentation, we have included non-GAAP financial information including adjusted operating income from continuing operations, adjusted income from continuing operations and adjusted earnings per diluted share from continuing operations. We believe that this non-GA
Slide 4: Fourth Quarter and Full Year 2008 Results
Fourth Quarter and Full Year 2008 Results Fourth Quarter 2008 • $23.1 million in revenue and $0.10 non-GAAP adjusted EPS • $0.11 non-GAAP adj. EPS on a currency neutral basis • Organic growth was a strong 6.4% • 18% growth in non-GAAP operating profit Full Year 2008 • $88.0 million in revenue and $0
Slide 5: Investment Highlights
Investment Highlights • Strong Track Record of Growth and Profitability • 20% 11-year revenue CAGR • 19% 11-year non-GAAP adjusted operating income CAGR • Tools to Advance Life Science Research • Organic Growth plus Tuckunder Acquisitions plus Operational Improvements Strategy • Drives growth even i
Slide 6: Harvard Bioscience – Business Summary
Harvard Bioscience – Business Summary • Tools to Advance Life Science Research •Mainly relatively inexpensive products that avoid the volatility of capital equipment •Well established products, brands and distribution channels that provide strong barriers to entry •Driven more by academic and pharma
Slide 7: Business Strategy
Business Strategy Our strategy is to have a broad range of relatively inexpensive products that have strong positions in niche markets in life science research: This gives us high operating margins and low volatility We grow through a combination of organic growth (driven by new products, direct m
Slide 8: HBIO Has Three Major Product Lines
HBIO Has Three Major Product Lines Hoefer Business Global market Major player Major player Position: leader Products: Physiology Spectrophotometers Electrophoresis products and plate readers products Market Size: Approx. $400m pa Approx. $1,100m pa Approx. $700m pa Average Approx. $1,000 Approx. $5,
Slide 9: HBIO – Harvard Apparatus Products
HBIO – Harvard Apparatus Products Established in 1901 at New 2008 Catalogs Harvard Medical School The name Harvard is used under a license agreement between Harvard Bioscience and Harvard University Copyright © Harvard Bioscience 2009 Tools to Advance Life Science Research
Slide 10: Physiology / Pharmacology Products
Physiology / Pharmacology Products Syringe Pumps – Animal Ventilators – Cell & Tissue Incubators – market leader market leader market leader Neuroscience Research Systems – Panlab Organ Systems – Acquisition in 2007 Electroporation – market leader strong #2 with new technology Market shares are mana
Slide 11: Biochrom - Molecular Biology Products
Biochrom - Molecular Biology Products Spectrophotometers – #2 in life science Plate Readers – small share with big plans Major new product – microliter spectrophotometer Amino Acid Analyzer – market leader Market shares are management estimates and Copyright © Harvard Bioscience 2009 have not been i
Slide 12: Molecular Biology – Major New Product
Molecular Biology – Major New Product • New microliter spectrophotometer – uses only 1 microliter (one drop) vs. traditional spectrophotometers that use 100 microliters • $50m market growing 20% per year • Launched via long standing relationship with GE Healthcare - Strong brand - Global distributio
Slide 13: Hoefer and SciePlas - Electrophoresis Products
Hoefer and SciePlas - Electrophoresis Products Hoefer 1D Premium SciePlas 1D Value Electrophoresis Electrophoresis Major new catalog in Q2 2009 Market shares are management estimates and Copyright © Harvard Bioscience 2009 have not been independently verified Tools to Advance Life Science Research
Slide 14: Acquisitions
Acquisitions • Acquisitions are a core part of our growth strategy: • We focus on “tuck under” acquisitions of product lines that are complementary to our current ones • Our “sweet spot” is $3.0-$8.0 million in revenue • Typically below the radar of the big companies • Typically immediately accretiv
Slide 15: Operational Improvement
Operational Improvement • Continuous operational improvement allows us to grow operating profit faster than revenue • Non-GAAP adjusted operating income has increased from 14.6% of revenue in 2005 to 16.4% in 2008 • We believe we can continue to increase it • Recent improvements: • Split electrophor
Slide 16: EPS Growth Model – 3-5 Year Plan
EPS Growth Model – 3-5 Year Plan Organic Growth 5-10% + Tuck under Acquisitions 10-15% + Operational Improvements 0-5% = Total Expected Average EPS Growth 15-25% Copyright © Harvard Bioscience 2009 Tools to Advance Life Science Research
Slide 17: Financial Results – Strong, Consistent Growth
Financial Results – Strong, Consistent Growth Revenue From Continuing 11 year CAGR At $100.0 Operations 20% 2008 FX $91.5 $88.0 $90.0 $83.4 $82.5 $80.0 $76.2 * Est. $70.0 $67.4 $64.7 $60.0 (in millions) $52.0 $50.0 $47.0 IPO $38.1 $40.0 $30.6 $30.0 $26.2 $20.0 MBO $11.5 $12.1 $10.0 $- 1997 1998 1999
Slide 18: Financial Results – Strong Profits
Financial Results – Strong Profits 11 year Non-GAAP Adjusted Operating CAGR $16.0 19% Income $14.5 $13.8 $14.0 $12.4 $12.0 SOX $10.3 $9.9 $10.0 $8.9 (in millions) $7.8 $8.0 $6.9 IPO $6.0 $4.8 $4.8 $4.0 MBO $2.4 $2.1 $2.0 $- 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Note: See reconc
Slide 19: Financial Results – Strong EPS Growth
Financial Results – Strong EPS Growth 11-year Non-GAAP Adjusted Diluted EPS CAGR $0.35 From Continuing Operations 15% FX $0 .3 2 $0 .3 1 * Est. $0 .3 0 $0.30 GNSL $0 .2 6 Acq. $0.25 (Divested SOX 2007) $0 .19 $0 .19 $0 .19 $0 .19 $0.20 $0 .17 IPO $0 .17 $0 .15 $0.15 MBO $0 .10 $0.10 $0 .0 7 $0.05 $-
Slide 20: EPS and the Stock Price
EPS and the Stock Price Non-GAAP Adjusted Diluted EPS Year end closing stock price – From Continuing Operations – red line Green Bars $0.35 $12.00 $0.30 $10.00 $0.25 $8.00 $0.20 $6.00 $0.15 $4.00 $0.10 $2.00 $0.05 $- $0.00 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Note: See re
Slide 21: Experienced Management Team
Experienced Management Team Title Background Chane Graziano CEO Waters, ATI Orion David Green President Monitor, Unilever Sue Luscinski COO Harvard Bioscience Tom McNaughton CFO Tivoli Audio, Cabot Corporation Copyright © Harvard Bioscience 2009 Tools to Advance Life Science Research
Slide 22: Commitment to Stockholder Value
Commitment to Stockholder Value • Management holds approximately 17% of shares + 14% in options • We believe tuck-under growth strategy can be financed with cash, cash flow and credit line, therefore no dilution • Modest debt leverage helps drive EPS without undue financial risk • Divestment of Geno
Slide 23: Investment Highlights
Investment Highlights • Strong Track Record of Growth and Profitability • 20% 11-year revenue CAGR • 19% 11-year non-GAAP adjusted operating income CAGR • Tools to Advance Life Science Research • Organic Growth plus Tuckunder Acquisitions plus Operational Improvements Strategy • Drives growth even i
Slide 24: Additional Information
Tools to Advance Life Science Research ADDITIONAL INFORMATION NASDAQ HBIO Copyright © Harvard Bioscience 2009
Slide 25: Appendix A
Appendix A For the years ended December 31, 1997 1998 1999 2000 (IPO) 2001 2002 2003 2004 2005 2006 2007 2008 Revenues $ 11,464 $ 12,154 $ 26,178 $ 30,575 $ 38,088 $ 47,009 $ 52,024 $ 64,745 $ 67,431 $ 76,181 $ 83,407 $ 88,049 Revenue eleven-year compound annual growth rate from 1997 to 2008: 20.36%
Slide 26: Appendix B
Appendix B March 31, June 30, September 30, December 31, March 31, June 30, September 30, December 31, March 31, June 30, September 30, December 31, March 31, June 30, September 30, December 31, 2005 2005 2005 2005 2006 2006 2006 2006 2007 2007 2007 2007 2008 2008 2008 2008 Revenues $ 16,135 $ 16,27
Slide 27: Appendix C
Appendix C Reconciliation of Guidance for US GAAP Earnings per Diluted Share From Continuing Operations to Adjusted Non-GAAP Earnings per Diluted Share From Continuing Operations (unaudited) Three Months Ended Year Ended March 31, 2009 December 31, 2009 Low High Low High Estimate Estimate Estimate E
Slide 28: Appendix D
Appendix D HARVARD BIOSCIENCE, INC. Reconciliation of Changes In Total Revenue Compared to the Same Period of the Prior Year (Continuing Operations) (unaudited) For the For the For the Year Year Year For the Three Months Ended Ended Three Months Ended Ended Three Months Ended Ended March 31, June 30
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