Harvard Bioscience, Inc. · NASDAQ:HBIO
Harvard Bioscience — Investor Presentation (October 2018)
25 slides from Harvard Bioscience's investor presentation, October 2018
Slide 1: Investor Introduction & Discussion
Investor Introduction & Discussion October 2018
Slide 2: Table of Contents
Table of Contents Introduction to Harvard Bioscience 5 Strategy 8 Financial Information 20 Appendix 24 2
Slide 3: Safe Harbor Statement
Safe Harbor Statement This presentation contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of such words as “will,” “guidance,” “objectives,” “optimistic,” “potential,” “future,” “expects,” “plans,” “estimates,” “contin
Slide 4: Introduction to Harvard Bioscience, Inc.
Introduction to Harvard Bioscience, Inc.
Slide 5: History and Overview
History and Overview William Porter founded Harvard Bioscience, Acquired DSI; the Harvard Apparatus Inc. files a form S-1 divested Denville Company with the SEC Becomes a for profit Acquired MCS and TBSI subsidiary of the Harvard to become a market Apparatus Foundation leader in the ephys and animal
Slide 6: Commercial Units
Commercial Units Physiology, Cell, and Molecular Data Sciences International (DSI) Electrophysiology (Ephys) Instruments (PCMI) Approx. 47% of Revenue Approx. 35% of Revenue Approx. 18% of Revenue Brands Brands Harvard Apparatus® Biochrom® Warner® Panlab® Biodrop® HEKA Coulbourn® BTX
Slide 7: Strategy
(i Harvard Bioscience Stategy
Slide 8: Strategy
Strategy Commercial Reinvigorating Business Operational Excellence / Product Development / Efficiency Organic Growth Development Acquisitions 8
Slide 9: Commercial Brands
Commercial Brands Strong brands position HBIO as a leading competitor in the Life Science arena. 9
Slide 10: Footprint
Footprint 12 10 5 13 7 11 9 3 1 2 4 8 15 3 6 14 Corporate Headquarters 8 Panlab, S.L. 1 & Manufacturing 9 S.A.R.L. 2 Hoefer Corporate Office 3 Data Sciences 10 Biochrom Distribution Center 4 Warner 11 Hugo Sachs Elektronik 5 Harvard Apparatus Canada 12 CMA Microdialysis Manufacturing 6 Triangle Bios
Slide 11: Harvard Bioscience's Portfolio Transformation
Harvard Bioscience’s Portfolio Transformation In January 2018, the Company acquired Data Sciences International (“DSI”), while simultaneously selling Denville Scientific, Inc. (“Denville”). These transactions turn Harvard Bioscience into a $120M pure play life science instrumentation business wi
Slide 12: Financial Impacts
Financial Impacts Margin Expansion and Profitability Improvements Non-GAAP Adjusted Gross Margin Non-GAAP Adjusted Operating Non-GAAP Adjusted EPS Margin 55% 11% $0.20 FY 16A $0.15 FY 16A 7% 7% FY 16A $0.12 FY 17A FY 17A FY 17A 46% 47% FY 18E FY 18E FY 18E +800 bps +400 bps +67% 12
Slide 13: DSI Transaction Overview
DSI Transaction Overview On January 31, 2018, the Company closed on the acquisition of DSI for $70M. The transaction was financed by cash on hand, the proceeds from the sale of Denville, and approximately $67M in debt. DSI is a St. Paul, MN-based life science research company, a recognized leade
Slide 14: DSI Product Portfolio
DSI Product Portfolio Physiologic Monitoring Instrumentation Data Acquisition and Analysis Tools Scientific Services Surgical Data Review Validation 14
Slide 15: DSI Key Global Customers
DSI Key Global Customers Academia Government / Non-Profit Pharmaceutical / Medical Technology Industry Contract Research Organizations 15
Slide 16: Drug Development Process
(HY Harvard Bioscience Drug Development Proc ess TARGET LEAD MEDICAL 5 IN VITRO 7 IN VIVO SELECTION y DISCOVERY | CHEMISTRY STUDIES i STUDIES 4 (2) BAe MS TBUMENTS bigchrom . A Atiocter HE OSI TIMARNEE ——- Danlab GioDrope @SCE-PLAS Ba, rout yatorns (ist) ome H Harvard Apparatus
Slide 17: Denville Transaction Overview
Denville Transaction Overview On January 22, 2018, the Company announced the divestiture of Denville for $20M. The proceeds from the transaction were used to pay down the Company’s existing debt and finance the acquisition of DSI. Denville is a Charlotte, NC-based lab consumable distributor, whi
Slide 18: Transaction Rationale
Transaction Rationale The portfolio shift creates a more profitable company, with immediate expansion of gross margins, operating margins, and non-GAAP adjusted EPS. Customer mix substantially changes with these deals to higher growth customers. Before the transactions, 70% of consolidated reven
Slide 19: Financial Information
(i Harvard Bioscience Financial Information
Slide 20: 2018 Financial Guidance
2018 Financial Guidance Revenues Adjusted EPS $120- $0.20- $123 $0.23 $104.5 $0.15 $101.9 $0.12 2016 2017 2018 (G) 2016 2017 2018 (G) * Based on estimated 36 million shares outstanding and 25%-28% expected tax rate 20
Slide 21: Financial Impacts: Balance Sheet – Path to De-Lever
Financial Impacts Balance Sheet – Path to De-Lever Through our legacy tax assets, as well as those acquired from DSI, we will not be a cash tax payer in the U.S. in the next 3-5 years. Leverage: Day 1 leverage = approximately 4x TTM EBITDA Based on expected cash flows, path to get to approxima
Slide 22: Stock Information
Stock Information September 21, 2018 Exchange: NASDAQ Symbol: HBIO Stock Price $5.20 Market Cap $190m h Shares Outstanding 36.6m Insider Ownership 2% (Approximation) Institutional Ownership 66% (Approximation) 22
Slide 23: Appendix
(i Harvard Bioscience Appendix
Slide 24: Financial Reconciliations
Financial Reconciliations Exhibit 1 Exhibit 2 Exhibit 3 HARVARD BIOSCIENCE, INC. HARVARD BIOSCIENCE, INC. HARVARD BIOSCIENCE, INC. Reconciliation of GAAP Net Income (Loss) to Non-GAAP Adjusted Net Income Reconciliation of GAAP Diluted Earnings (Loss) Per Common Share to Non-GAAP Adjusted Diluted Ear
Slide 25: Financial Reconciliations
Financial Reconciliations Exhibit 4 Exhibit 5 HARVARD BIOSCIENCE, INC. HARVARD BIOSCIENCE, INC. Reconciliation of GAAP Net Loss to Non-GAAP Adjusted Net Income Reconciliation of GAAP Diluted Loss Per Common Share to Non-GAAP Adjusted Diluted Earnings Per Common (unaudited, in thousands) Share (unaud
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