Neogen Corp. (NEOG) Thursday reported a decline in its second-quarter earnings, despite a 6% increase in revenues. While the overall performance was negatively impacted by lower demand for animal protein products, the bottom-line came in line with estimates.
Net income attributable to shareholders dropped to $16.01 million or $0.31 per share in the November quarter from $17.1 million or $0.33 per share last year, when the results had benefitted from a tax credit from employee stock option exercises. Earnings for the latest quarter matched analysts’ forecast.
Earnings dropped about 6% from last year when the results had benefitted from a tax credit from employee stock option exercises
Revenues of the company, which makes medical testing kits, advanced 6% annually to $107.1 million in the second quarter, with the Food Safety segment and Animal Safety segment growing 9% and 4% respectively. Driving the top-line growth, international revenues increased 10%. Europe registered a 9% growth aided by the strength of the genomics business, while revenues in Brazil climbed 26%.
Attributing the dip in margins to unfavorable currency conversions, Neogen said it is all set to tap the opportunities in the overseas market in the coming quarters. “In the quarter, we had a number of strong performances in sales of recently commercialized products, especially in our foodborne pathogen and natural toxin product lines,” said CEO John Adent.
Neogen’s shares climbed to an all-time high in mid-September but pared the gains in the following weeks. The stock closed the last trading session lower and dropped about 4% in early trading Thursday after the earnings announcement.
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