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March 19, 2004
LSR ANNOUNCES 2003 RESULTS
Millstone, New Jersey, March 19, 2004 – Life Sciences Research, Inc.
("LSR") announced today that net revenues in the year ended
December 31, 2003 were $132.4 million, an increase of 14% on net
revenues of $115.7 million for the year ended December 31, 2002.
The underlying increase, after adjusting for the impact of the
movement in exchange rates, was 7%.
income before charging other operating expenses for the year ended
December 31, 2003 was $6.8 million compared to $4.3 million in the year
ended December 31, 2002. Other operating expenses were $3.5
million in 2003 and $0 in 2002, and mainly comprised of restructuring
costs arising from a consolidation of certain duplicate facilities in
the UK in order to improve the efficiency of our facilities and
income for the year ended December 31, 2003 was $3.7 million compared
with a net income of $2.7 million the previous year. This included
Other Income of $5.4 million in 2003 and $4.9 million in 2002. In
2003, Other Income included a gain of $0.6 million associated with the
repurchase of $1.4 million principal amount of the Company’s
outstanding convertible capital bonds and non-cash foreign exchange
transaction gains of $4.8 million on accounting for the Company’s
dollar denominated bonds converted into UK pound sterling. Other Income
in 2002 included a gain of $1.2 million associated with the repurchase
of $2.4 million principal amount of the Company’s outstanding
convertible capital bonds, non-cash foreign exchange transaction gains
of $5.0 million on accounting for the Company’s dollar denominated
bonds converted into UK pound sterling, offset by expenses associated
with the US redomiciling Exchange Offer of $1.3 million. Earnings before
Interest, Taxes, Depreciation and Amortization (“EBITDA”), exclusive
of the items discussed above, were $14.6 million for full year 2003, or
11.0% of sales, compared to $12.4 million, or 10.7% of sales, for the
prior year. Earnings for the year ended December 31, 2003 were
$0.29 per share on a diluted basis, compared with $0.24 in the year
ended December 31, 2002.
the quarter ended December 31, 2003, revenues were $35.1 million,
compared to $31.1 million during the same period last year.
Operating income before charging other operating expenses for the
quarter ended December 31, 2003 was $2.0 million compared to $1.6
million in the year ended December 31, 2002. Other operating
expenses were $3.8 million in the fourth quarter of 2003 and $0 in the
prior year. These mainly comprised the restructuring costs
referred to above. Net income for the quarter ended December 31,
2003 was $1.8 million compared with a net income of $1.6 million the
previous year. Fourth quarter earnings were $0.15 per share on a diluted
basis, compared with $0.13 in the quarter ended December 31, 2002.
cash provided by operating activities totaled $10.0 million in 2003,
compared to cash provided of $14.0 million in 2002. Capital expenditures
totaled $8.7 million in 2003 compared with $4.2 million in 2002.
Year-end cash and cash equivalents were $17.3 million compared to $14.6
million in the prior year, and total long term debt was $87.5 million,
an increase of $3.8 million from December 31, 2002 of $83.7 million.
This increase in long-term debt comprised a $4.0 million increase due to
exchange rate movements related to the company’s UK pound sterling
based debt, offset by a net repayment of $0.2 million.
business signings totaled $32.7 million for the fourth quarter of 2003,
and $123.7 million for the full year, a decrease of 12% and 8.5%
respectively from the prior year, exclusive of the impact of the
movement in exchange rates. 2002 saw a rapid growth in business
from the Pharmaceutical industry and this business was maintained in
2003. However there was a decline in the amount of work outsourced
from the Agrochemical industry, both on new chemical entities and as
registration work under European Directive 91/414/EEC diminished.
At December 31, 2003 backlog (booked-on work) amounted to approximately
$93.5 million. Net days sales outstanding were 17 days at year end.
Baker, LSR’s Chairman and CEO, said “2003 was another year of steady
progress for LSR with revenues, operating results and net income higher
than 2002. Cash management continues to be a priority and I am
pleased to report that cash balances at the year-end were ahead of last
year despite the higher level of investment in new capital projects to
strengthen our facilities and capabilities”.
Cass, LSR’s President and Managing Director, said, “Revenue growth
continued in the fourth quarter. New business enquiries remain
strong and the fourth quarter saw a recovery in orders from the levels
seen in the second and third quarters. This has also been
reflected in a robust order rate in the first two months of 2004”.
Mr. Cass continued “We continue to focus on productivity and cost management and have recently completed a restructuring of our UK facilities to improve the efficiency of our operations, whilst not hampering our near-term capacity for meeting clients’ needs. These changes will also help us to concentrate our investment going forward”.
Sciences Research, Inc. is a global Contract Research Organization
providing product development services to the pharmaceutical,
agrochemical and biotechnology industries. LSR brings leading
technology and capability to support its clients in non-clinical safety
testing of new compounds in early stage development and assessment.
The purpose of this work is to identify risks to humans, animals or the
environment resulting from the use or manufacture of a wide range of
chemicals which are essential components of LSR's clients' products.
The Company's services are designed to meet the regulatory requirements
of governments around the world. LSR operates research facilities
in the United States (the Princeton Research Center, New Jersey) and the
United Kingdom (Huntingdon and Eye, England). Information on LSR’s
business, recent press releases, and SEC filings can be obtained through
its website at www.lsrinc.net.
announcement contains statements that may be forward-looking as defined
by the USA’s Private Securities Litigation Reform Act of 1995.
These statements are based largely on LSR’s expectations and are
subject to a number of risks and uncertainties, certain of which are
beyond LSR’s control, as more fully described in LSR’s Registration
Statement on Form S-1, dated July 12, 2002, and the Company’s Form
10-K for the fiscal year ended December 31, 2002, each as filed with the
US Securities and Exchange Commission.
press release includes supplemental financial information that may
contain references to non-GAAP financial measures as defined in
Regulation G of SEC rules. Consistent with Regulation G, a
reconciliation of this supplemental financial information to our
generally accepted accounting principles (GAAP) information follows. We
present this non-GAAP supplemental financial information because we
believe it is of interest to the investment community and provides
additional meaningful methods of evaluating certain aspects of the
Company’s operating performance from period to period on a basis that
may not be otherwise apparent on a GAAP basis. This supplemental
financial information should be viewed in addition to, not in lieu of,
the Company’s consolidated statements of operations for the three and
twelve-month periods ended December 31, 2003 and 2002.
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