Harvard Bioscience Inc. (NASDAQ:HBIO) Q3 2018 Earnings Conference Call Transcript

Oct 25, 2018 • 04:30 pm ET

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Harvard Bioscience Inc. (NASDAQ:HBIO) Q3 2018 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Welcome to the Q3 2018 Harvard Bioscience, Incorporated Earnings Conference Call. My name is Adrian, and I'll be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. (Operator Instructions) Please note, this conference is being recorded.

I'll now turn the call over to Corey Manchester. Corey Manchester, you may begin.

Executive
Corey Manchester

Thank you, Adrian, and good afternoon, everyone. Thank you for joining us for the Harvard Bioscience Third Quarter 2018 Earnings Conference Call. Leading the call alongside me today, will be Jeffrey Duchemin, President and CEO of Harvard Bioscience.

(Forward-Looking Cautionary Statements)

Also, much of today's call will focus on our non-GAAP quarterly results, which we believe, better represents the ongoing economics of the business, reflects how we set and measure our incentive compensation plans and how we manage the business internally. The differences between our GAAP and non-GAAP results are outlined in the earnings release we issued today, which can be found on our website under Press Releases. Additionally, any material, financial or other statistical information presented on the call, which is not included in our press release, will be archived and available in the Investor Relations section of our website. A replay of this call will also be available for 1 week at the same location on our website at harvardbioscience.com.

I will now turn the call over to Jeff. Jeff, please go ahead.

Executive
Jeffrey Duchemin

Thanks, Corey. Good afternoon, everyone, and thank you for joining us for our Q3 earnings call. I want to begin today's call by saying that I'm so pleased with the company's overall performance and progression. The transformation of our business earlier this year by selling Denville and acquiring DSI was an inflection point in our company's evolution and has dramatically improved the profitability of the organization. Our financial performance improved this quarter, with substantial improvements in gross margins, operating margins and earnings. Our corporate controller, Corey Manchester will provide further details about our third quarter financial results after my review of corporate highlights and developments.

We had another quarter of year-over-year improvements in our key financial metrics. Third quarter revenue was $28.7 million, a 15% increase over revenue for the third quarter in 2017. The $28.7 million in revenue was a record third quarter for Harvard Bioscience. EPS for the quarter improved 33% to $0.04 a share, which was the result of overall revenue growth as well as significant improvements in gross margins and operating margins. The primary contributor to our increase in revenue was our DSI business. DSI produced a strong third quarter, with approximately $11.2 million in revenue. DSI performed well against prior year in our internal plan in most all geographies and sales channels. In addition to its strong revenue, DSI also had a record bookings this quarter, which reinforces our optimism about the contributions that this acquisition will bring to our company and is a solid indicator of future growth.

Our legacy product families, PCMI and electrophysiology, when combined