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Aug 31, 2023
Neogen Q1 2024 Earnings Report
Neogen's Q1 2024 results were announced, featuring a significant revenue increase driven by the 3M Food Safety Division merger, alongside a decrease in net income due to related expenses.
Key Takeaways
Neogen reported a 73% increase in revenue to $229.0 million, driven by the acquisition of the 3M Food Safety Division. However, net income decreased to $1.5 million, or $0.01 per diluted share, due to increased interest expense and amortization of acquisition-related intangibles. Adjusted EBITDA increased by 93.8% to $52.4 million, with a margin of 22.9%.
Revenue increased by 73.0% year-over-year to $229.0 million, primarily due to the acquisition of the 3M Food Safety Division.
Net income decreased to $1.5 million, or $0.01 per diluted share, impacted by expenses related to the 3M Food Safety merger.
Adjusted EBITDA rose by 93.8% to $52.4 million, with a margin of 22.9%.
Food Safety segment revenue increased significantly, while the Animal Safety segment experienced a core revenue decline due to destocking.
Neogen
Neogen
Neogen Revenue by Segment
Revenue by Segment
Food Safety Revenue
CapyFin.comAnimal Safety Revenue
CapyFin.com Forward Guidance
Neogen anticipates fiscal year 2024 revenue between $955 million and $985 million, while Adjusted EBITDA continues to be expected in a range of $235 million to $255 million. The Company also continues to expect capital expenditures to be approximately $130 million, including approximately $100 million related specifically to the integration of the former 3M Food Safety Division.
Positive Outlook
- Fiscal year 2024 revenue is anticipated to be between $955 million and $985 million.
- Adjusted EBITDA is expected to be in the range of $235 million to $255 million.
- Improved end-market environment expected in the second half of the year.
- Capital expenditures are projected to be approximately $130 million.
- Integration of the former 3M Food Safety Division is progressing well.
Challenges Ahead
- Typical seasonality of revenue may impact performance.
- Capital expenditures include approximately $100 million related to the integration of the former 3M Food Safety Division.
- Animal Safety business experienced continued destocking.
- Weakness in China impacted pro forma growth in the former 3M Food Safety Division.
- The Indicator Testing, Culture Media & Other product category experienced a core revenue decline.
Revenue & Expenses
Visualization of income flow from segment revenue to net income