MDCC Molecular Devices (MM)

SUNNYVALE, Calif., Oct. 27 /PRNewswire-FirstCall/ -- Molecular Devices Corporation (NASDAQ:MDCC) today announced record revenues and earnings for the quarter ended September 30, 2005. Revenues for the quarter were a record $45.2 million, or an increase of 9% compared to the same period last year. On a GAAP basis, operating income for the third quarter of 2005 was $6.4 million, or an increase of $6.0 million compared to the same period last year. On a non-GAAP basis, excluding the one-time charge of $5.0 million for acquired in-process research and development related to the Axon acquisition in the third quarter of 2004, operating income increased 18% to $6.4 million in the third quarter of 2005 from $5.4 million in the third quarter of 2004. On a GAAP basis, fully diluted earnings per share for the third quarter of 2005 were $0.28, an increase of $0.35 per share compared with the same period last year. On a non-GAAP basis, excluding the fully diluted per share impact of the one-time charge in the third quarter of 2004, fully diluted earnings per share increased 40% to $0.28 in the third quarter of 2005 from $0.20 per share in the same period last year. A table reconciling operating income and fully diluted earnings per share on a GAAP and non-GAAP basis is provided immediately following the Condensed Consolidated Balance Sheets. "We are encouraged by our third quarter results, as we saw good growth in both our life sciences and drug discovery product families," stated Joseph D. Keegan, Ph.D., Molecular Devices' President and Chief Executive Officer. "In life sciences, we continued to see strong demand for our SpectraMax(R) M5 bench-top reader. In drug discovery, we saw excellent growth in both our high-throughput electrophysiology and FLIPR(R) product lines. Finally, we continue to feel confident that our life sciences and drug discovery markets will remain stable in the near-term." The Company also established guidance for the fourth quarter of 2005, updated guidance for the full year 2005 and provided initial guidance for the full year 2006. For the fourth quarter of 2005, the Company anticipates revenues of $52 to $54 million and fully diluted earnings per share of $0.34 to $0.36. For the full year 2005, the Company anticipates revenues of $181 to $183 million and fully diluted earnings per share of $0.96 to $0.99. For the full year 2006, the Company anticipates revenues of $192 to $202 million and non-GAAP fully diluted earnings per share of $1.10 to $1.20. The 2006 guidance does not include the impact of expensing stock options under FAS 123R, "Share-Based Payment." Information with respect to the exclusion of the impact of FAS 123R is provided immediately following the Condensed Consolidated Balance Sheets. Conference Call Information An earnings announcement conference call is scheduled for Friday, October 28, 2005 at 8:00 a.m. PDT (11:00 a.m. EDT). Interested parties can participate in the call by dialing 800-811-8830 (domestic) or 913-981-4904 (international). Replay dial-in numbers are 888-203-1112 (domestic) and 719-457-0820 (international), and the access code for the replay is 2041565. Investors can also access a live web-cast of the call through a link posted on the investor page on Molecular Devices' website (http://www.moleculardevices.com/). A replay of the web-cast will be available at this location from October 28, 2005 to such time as the company reports its financial results for the fourth quarter of 2005. About Molecular Devices Corporation Molecular Devices Corporation is a leading supplier of high-performance bioanalytical measurement systems that accelerate and improve drug discovery and other life sciences research. The Company's systems and consumables enable pharmaceutical and biotechnology companies to leverage advances in genomics, proteomics and parallel chemistry to facilitate the high-throughput and cost-effective identification and evaluation of drug candidates. The Company's solutions are based on its advanced core technologies that integrate its expertise in engineering, molecular and cell biology and chemistry. Molecular Devices enables its customers to improve research productivity and effectiveness, which ultimately accelerates the complex process of discovering and developing new drugs. This press release contains "forward-looking" statements, including statements related to future revenues and earnings. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Words such as "believes," "anticipates," "plans," "expects," "will," and similar expressions are intended to identify forward-looking statements. There are a number of important factors that could cause the results of Molecular Devices Corporation to differ materially from those indicated by these forward-looking statements, including, among others, risks related to variations in the amount of time that it takes for the Company to sell its products and collect accounts receivable, the timing of customer orders and the Company's dependence on orders that are shipped in the same quarter, which gives the Company limited visibility of future product shipments, risks related to increased competition, risks associated with the Company's need to develop new and enhanced products and other risks detailed from time to time in the Company's SEC reports, including its Quarterly Report on Form 10-Q for the quarter ended June 30, 2005. Molecular Devices Corporation does not undertake any obligation to update forward-looking statements. MOLECULAR DEVICES CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) Three Months Ended Nine Months Ended September 30, September 30, 2005 2004 2005 2004 (unaudited) (unaudited) REVENUES $45,156 $41,502 $128,758 $101,044 COST OF REVENUES 17,393 15,802 50,040 38,120 GROSS PROFIT 27,763 25,700 78,718 62,924 OPERATING EXPENSES: Research and development 6,421 6,432 18,956 15,158 Selling, general and administrative 14,947 13,828 43,854 36,364 Acquired in-process research and development -- 5,000 -- 5,000 Total operating expenses 21,368 25,260 62,810 56,522 INCOME FROM OPERATIONS 6,395 440 15,908 6,402 Interest and other income, net 46 41 19 126 INCOME BEFORE TAXES 6,441 481 15,927 6,528 Income tax provision (1,793) (1,749) (5,398) (3,862) NET INCOME (LOSS) $4,648 $(1,268) $10,529 $2,666 BASIC NET INCOME (LOSS) PER SHARE $0.28 $(0.07) $0.63 $0.17 DILUTED NET INCOME (LOSS) PER SHARE $0.28 $(0.07) $0.61 $0.17 SHARES USED IN COMPUTING BASIC NET INCOME (LOSS) PER SHARE 16,567 17,751 16,841 15,557 SHARES USED IN COMPUTING DILUTED NET INCOME (LOSS) PER SHARE 16,890 17,751 17,158 16,055 MOLECULAR DEVICES CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) September 30, December 31, 2005 2004 ASSETS (unaudited) Current assets: Cash and cash equivalents $12,191 $30,175 Accounts receivable, net 37,336 36,995 Inventories, net 24,021 25,785 Deferred tax assets 8,239 9,654 Prepaids and other current assets 2,562 2,780 Total current assets 84,349 105,389 Equipment and leasehold improvements, net 10,149 11,762 Other assets 147,037 138,078 $241,535 $255,229 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $7,866 $7,085 Accrued liabilities 23,738 30,748 Total current liabilities 31,604 37,833 Long-term liabilities: Other long-term liabilities 1,060 1,452 Deferred tax liabilities 5,296 5,324 Total long-term liabilities 6,356 6,776 Stockholders' equity 203,575 210,620 $241,535 $255,229 HISTORICAL NON-GAAP RECONCILIATION (unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2005 2004 2005 2004 OPERATING INCOME - GAAP BASIS $6,395 $440 $15,908 $6,402 Acquired in-process research and development -- 5,000 -- 5,000 NON-GAAP OPERATING INCOME $6,395 $5,440 $15,908 $11,402 GAAP FULLY DILUTED EARNINGS (LOSS) PER SHARE $0.28 $(0.07) $0.61 $0.17 Acquired in-process research and development -- 0.27 -- 0.31 NON-GAAP FULLY DILUTED EARNINGS PER SHARE $0.28 $0.20 $0.61 $0.48 FULLY DILUTED SHARES 16,890 18,327 17,158 16,055 NON-GAAP FINANCIAL GUIDANCE Molecular Devices Corporation's guidance for the full year 2006 with respect to fully diluted earnings per share excludes the impact of the adoption of FAS 123R, "Share-Based Payment." Molecular Devices will adopt FAS 123R in the first quarter of 2006 and although expected to be material, Molecular Devices cannot predict the impact of the adoption of FAS 123R at this time because it will depend on the valuation methodology adopted, assumptions used and the levels of share-based payments granted in the future. Accordingly, Molecular Devices cannot estimate GAAP fully diluted earnings per share for the full year 2006 at this time with any degree of certainty. NON-GAAP MEASURES Each non-GAAP financial measure presented in this press release is included because Molecular Devices Corporation's management uses this information for internal planning and forecasting purposes as well as to monitor and evaluate on-going operating results and trends excluding the impact of the adoption of FAS 123R and the unusual item related to the acquisition of Axon Instruments in July 2004. Molecular Devices' management believes that with respect to such historical non-GAAP financial measures, such measures are also useful for investors because the charge for acquired in-process research and development related to the Axon acquisition is the result of a transaction that is unusual due to its nature, size and frequency. Consequently, excluding this charge from Molecular Devices' operating results provides investors an important insight into Molecular Devices' operating results and related trends of its core business. In addition, excluding the impact of FAS 123R from Molecular Devices' financial guidance provides meaningful supplementary information to both management and investors that is indicative of Molecular Devices' core anticipated operating results and enhances an overall understanding of Molecular Devices' prospects for the future. DATASOURCE: Molecular Devices Corporation CONTACT: Tim Harkness of Molecular Devices Corporation, +1-408-747-3533 Web site: http://www.moleculardevices.com/

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