Bio-Reference Laboratories, Inc. Announces Record-Breaking Year-End and Fourth Quarter Results

ELMWOOD PARK, N.J.--(BUSINESS WIRE)--Bio-Reference Laboratories, Inc. (NASDAQ: BRLI) (Except for Per Share Data or where otherwise noted, Numbers are in Thousands) announced record-setting fourth quarter and year-end performance numbers. The Company recorded Q4FY08 revenues of $81,236, the best ever quarter in terms of revenues in corporate history and an increase of 16% over the $69,795 recorded in the fourth quarter, fiscal year 2007. Net income before taxes in Q4FY08 totaled $9,335; an increase of 19% compared with net income before taxes of $7,855 in Q4FY07. Net income after tax for Q4FY08 totaled $5,245 or $.38 per share as compared with $4,644 or $.33 per share in the corresponding quarter in FY07. Gross profits on revenues for the current quarter were $40,801 resulting in a margin for gross profit on revenues of 50%, versus the $36,191 reported for the prior fiscal year fourth quarter, resulting in a slightly higher margin of 52%. Revenue per patient for the fourth quarter of the current fiscal year was $78.22, an increase of 10% over the $71.06 reported for the same quarter of the prior fiscal year. The number of patients served increased 6% to 1029 in the current quarter from the prior year fourth quarter total of 972. Esoteric business for the Company increased to 50% of revenues for the fourth quarter of the current fiscal year.

Full year revenues increased to $301,071, an increase of 20% over the same period revenues of $250,431 in the prior fiscal year. Net income after taxes for the current year was $15,617 resulting in an EPS of $1.12; this was an increase of 12% from the prior fiscal year net income after taxes of $13,957, which resulted in an EPS of $1.01. The Company reported gross profit on revenues for the 2008 fiscal year of $147,240, resulting in a margin for gross profit on revenues of 49% compared to the prior year same period of $126,402 which resulted in a margin of 50%. The number of patients served increased nearly 11% to 4,085 in the fiscal year from the prior fiscal year total of 3,681.

The Company noted that during Q4FY08, it introduced two new innovative testing initiatives. In August 2008, the Company’s GeneDx subsidiary began accepting samples on a limited basis for hypertrophic cardiomyopathy, genetic testing based on next generation (NextGen) sequencing. GeneDx is probably the first purely commercial laboratory to offer testing on the NextGen platform. In September 2008, the Company launched its Second Generation Women’s Health Initiative offering affordable, comprehensive testing for sexually transmitted infections.

Marc D. Grodman, MD, CEO, commented: “We recognize that these are difficult economic times and we are gratified, especially within that context, with the results that we have been able to achieve. In late FY07, early FY08 we made the decision to invest in infrastructure and marketing in order to take advantage of market opportunities that we felt would provide a long-term benefit to the Company. While that decision had some impact on our annual numbers, we believe that the fruits of that decision are clearly indicated in our third and fourth quarter numbers. In 2007, our growth was fueled by the tremendous regional opportunity presented by changes in the managed care environment. In 2008, we re-focused on esoteric testing, which had been our primary growth driver over the prior few years, and we believe the results validate the correctness of our decision. We have seen a flattening of our patient count numbers as the growth of the routine business has returned to our pre-2007 levels and we have made a conscious effort to emphasize areas where we can grow and find leverage and de-emphasize those where we can’t. Our increase in our revenue per patient has been fueled by our success in our national specialty services and Women’s Health Initiatives. It is, and has been for some time, our stated goal to seek out disruptive technology and scientific advances in specialty testing and to offer those services under a superior service, physician-centric model. Better science and better service enable the physician to provide better healthcare.”

Dr. Grodman further noted: “During the fourth quarter we introduced two new initiatives based on unique technology platforms and sophisticated scientific capabilities. We began offering our NextGen sequencing test for hypertrophic cardiomyopathy in August of this year. It has taken well over a year of research and development to bring this testing to market and our initial limited offering has been well received. In September of this year we introduced our second-generation Women’s Health Initiative and we believe that it will surpass the great success of our initial Women’s Health program. We are scheduled to introduce additional testing capabilities based on better, more advanced science during the first half of the coming year when we will introduce our hempath CGH array test. We have expanded our footprint for specialty testing throughout the entire United States and have seen significant growth in our esoteric testing based on our better science and better service model.”

Dr. Grodman continued: “While we believe that the economy has had an effect on volumes and we believe that our growth might have been greater in a more stable economic environment, we are pleased with our financial results. We have continued to extend our twenty per cent compound annual growth rate into a fifteenth year; we believe that such sustained growth is unprecedented in our industry. We have a seasoned and well-experienced team of managers and scientists and hard-working employees that have enabled us to maintain this growth over the last decade and a half. We expect that in 2009 our top-line revenue will grow at least 15% and we expect that our net income will increase at least 20%. We have maintained fiscal discipline over the last two quarters and we do not currently see any extraordinary expenses that will have any impact on our P&L. We will continue to deliver better healthcare through better science and better service.”

The Company’s year-end earnings conference call has been scheduled to take place this morning, December 18, 2008 at 10:30 a.m. Eastern Standard Time. The live audio Web cast will be available at the Company’s corporate Web site, www.bioreference.com and through www.streetevents.com. To listen to the call please go to either Web site ten minutes before the conference call is scheduled to begin. You will need to register as well as download and install any necessary audio software. The Web cast will be archived, on both Web sites, for 30 days following the call.

About Bio-Reference Laboratories, Inc.

BRLI is the third largest full service laboratory in the United States and the largest independent laboratory in the Northeastern market, primarily a clinical testing lab servicing physician offices with concentrations in the focused markets of esoteric testing, molecular diagnostic, anatomical pathology and correctional health care. BRLI operates as a national oncology laboratory under its GenPath label. Better science, superior technology and better service have enabled GenPath to earn a reputation as one of the premier hematopathology laboratories in the country. GeneDx, a wholly owned subsidiary, is the BRLI genetics laboratory and is typically recognized as the leading laboratory for testing of rare genetic diseases; GeneDx has now become a technology leader with GenomeDx, based on a CGH array platform and its NextGen sequence offerings that are and will be disease specific.


Bio-Reference Laboratories, Inc. Statements of Operations (Dollars in Thousands Except Per Share Data) (Unaudited)
	Three Months Ended		Twelve Months Ended
	October 31		October 31

	2008	2007	2008	2007
Net Revenues	$81,236	$69,795	$301,071	$250,431
Cost of Sales	40,435	33,604	153,831	124,029
Gross Profit on Revenues	40,801	36,191	147,240	126,402
General and Administrative	31,040	27,753	118,683	101,345
Operating Income	$9,761	$8,438	$28,557	$25,057
Other Expense, Net	426	582	1,866	2,150
Income Before Taxes	$9,335	$7,855	$26,691	$22,907
Taxes	4,090	3,211	11,074	8,950
Net Income	$5,245	$4,644	$15,617	$13,957
Income Per Share	$.39	$.34	$1.14	$1.02
Number of Shares	13,776,795	13,723,301	13,775,790	13,655,562
Income Per Share (Diluted)	$.38	$.33	$1.12	$1.01
Number of Shares (Diluted)	13,967,140	13,973,394	13,966,345	13,807,368


Bio-Reference Laboratories, Inc. Balance Sheet (Dollars in Thousands)

	October 31,	October 31,
	2008	2007
Cash & Cash Equivalents	$12,696	$11,897
Accounts Receivable (Net)	93,718	86,018
Plant, Property & Equipment (Net)	24,457	20,525
Intangible Assets (Net)	24,646	23,231
Other Assets	16,452	12,903
Total	$171,969	$154,574

Accounts Payable	$25,801	$24,576
Revolving Note	18,831	23,252
Long-Term Debt	12,892	12,682
Other Liabilities	12,905	8,797
Shareholder’s Equity	101,540	85,267
Total	$171,969	$154,574

Statements included in this release that are not historical in nature, are intended to be, and are hereby identified as “forward-looking statements”. Statements looking forward in time are included in this release pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks and uncertainties that may cause the Company’s actual results in future periods to be materially different from any future performance suggested herein.