SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[x] QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For quarterly period ended: February 28, 1998
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________________ to ______________
Commission File Number: 0-17988
NEOGEN CORPORATION
(Exact name of small business issuer as specified in its charter)
MICHIGAN 38-2367843
(State or other jurisdiction of (IRS employer
incorporation or organization) Identification No.)
620 LESHER PLACE, LANSING, MICHIGAN 48912
(Address of principal executive offices)
(517)372-9200
(Issuer's telephone number)
NONE
(Former name, former address and former
fiscal year, if changed since last report.)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12
months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the
past 90 days.
Yes __ x __ No _______
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Check whether the registrant filed all documents and reports required to
be filed by Section 12, 13, or 15(d) of the Securities Exchange Act of 1934
after distribution of securities under a plan confirmed by a court.
Yes _______ No _________
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practical date.
6,207,879 shares were outstanding on April 1, 1998
<PAGE>
INDEX
NEOGEN CORPORATION AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION
Item 1. Interim Financial Statements (unaudited)
Consolidated balance sheets--February 28, 1998 and May 31, 1997.
Consolidated statements of operations--Three months ended February
28, 1998 and 1997; nine months ended February 28, 1998 and 1997.
Consolidated statements of stockholders' equity--Nine months ended
February 28, 1998 and 1997.
Consolidated statements of cash flows--Nine months ended February
28, 1998 and 1997.
Notes to consolidated financial statements--February 28, 1998.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. Interim Financial Statements
<PAGE>
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
NEOGEN CORPORATION AND SUBSIDIARIES
<TABLE>
<CAPTION>
February 28 May 31
1998 1997
------------ ------------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and equivalents $ 788,182 $ 718,864
Marketable securities 9,618,475 12,324,913
Net accounts receivable 3,146,411 2,024,161
Inventories 4,517,265 3,620,200
Other current assets 407,943 353,437
------------ ------------
TOTAL CURRENT ASSETS 18,478,276 19,041,575
NET PROPERTY AND EQUIPMENT 1,952,658 1,564,552
INTANGIBLE AND OTHER ASSETS
Goodwill, net of accumulated amortization 3,755,053 2,012,195
Other assets, net of accumulated amortization 1,161,050 530,151
------------ ------------
$ 25,347,037 $ 23,148,473
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable and current maturities
of long-term notes payable - (Note D) $ 48,673 $ 71,147
Accounts payable 978,220 842,985
Accrued compensation and benefits 453,795 607,052
Other accrued liabilities 192,075 255,414
------------ ------------
TOTAL CURRENT LIABILITIES 1,672,763 1,776,598
LONG-TERM NOTES PAYABLE - (NOTE D) 186,560 207,770
OTHER LONG-TERM LIABILITIES 150,904 150,905
STOCKHOLDERS' EQUITY
Common stock:
Par value $.16 per share, 10,000,000 shares
authorized, 6,207,879 shares issued at
February 28, 1998; 6,110,608
shares issued at May 31, 1997 993,261 977,697
Additional paid in capital 24,268,865 23,937,397
Retained-earnings deficit (1,925,316) (3,901,894)
------------ ------------
23,336,810 21,013,200
------------ ------------
$ 25,347,037 $ 23,148,473
============ ============
<FN>
See notes to consolidated financial statements
</TABLE>
<PAGE>
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
NEOGEN CORPORATION AND SUBSIDIARIES
<TABLE>
<CAPTION>
Three Months Ended February 28 Nine Months Ended February 28
1998 1997 1998 1997
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
REVENUES $ 4,544,221 $ 3,586,710 $ 13,598,455 $ 11,382,795
EXPENSES
Cost of goods sold 2,021,628 1,478,867 5,764,834 4,512,765
Sales and marketing 1,148,474 977,236 3,544,878 3,226,684
General and administrative 608,321 520,724 1,917,740 1,614,669
Research and development 348,763 321,655 1,003,463 988,004
------------ ------------ ------------ ------------
4,127,186 3,298,482 12,230,915 10,342,122
------------ ------------ ------------ ------------
INCOME FROM OPERATIONS 417,035 288,228 1,367,540 1,040,673
OTHER INCOME (EXPENSE)
Interest income 148,422 165,948 464,482 267,004
Interest expense (3,326) (6,720) (16,047) (59,880)
Other 79,954 80,175 214,503 127,933
------------ ------------ ------------ ------------
225,050 239,403 662,938 335,057
------------ ------------ ------------ ------------
INCOME BEFORE
INCOME TAXES 642,085 527,631 2,030,478 1,375,730
INCOME TAX EXPENSE (BENEFIT) (15,200) 23,300 53,900 57,900
------------ ------------ ------------ ------------
NET INCOME $ 657,285 $ 504,331 $ 1,976,578 $ 1,317,830
============ ============ ============ ============
NET INCOME PER SHARE
BASIC - (NOTE B) $ 0.11 $ 0.08 $ 0.32 $ 0.25
============ ============ ============ ============
NET INCOME PER SHARE -
ASSUMING DILUTION - (NOTE B) $ 0.10 $ 0.08 $ 0.31 $ 0.24
============ ============ ============ ============
<FN>
See notes to consolidated financial statements.
</TABLE>
<PAGE>
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED)
NEOGEN CORPORATION AND SUBSIDIARIES
<TABLE>
<CAPTION>
Common Stock
------------------------- Additional Retained-
Number Paid - In Earnings
of Shares Amount Capital Deficit
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Balance at June 1, 1997 6,110,608 $ 977,697 $23,937,397 $(3,901,894)
Exercise of warrants 471 76 2,195
Exercise of options 96,800 15,488 329,273
Net income for the
nine months ended
February 28, 1998 1,976,578
----------- ----------- ----------- -----------
Balance at February 28, 1998 6,207,879 $ 993,261 $24,268,865 $(1,925,316)
=========== =========== =========== ===========
Balance at June 1, 1996 4,559,260 $ 729,482 $13,841,617 $(5,713,395)
Exercise of warrants 1,782 285 8,304
Exercise of options 47,866 7,658 124,928
Issuance of common shares 1,501,100 240,176 9,961,180
Net income for the
nine months ended
February 28, 1997 1,317,830
----------- ----------- ----------- -----------
Balance at February 28, 1997 6,110,008 $ 977,601 $23,936,029 $(4,395,565)
=========== =========== =========== ===========
<FN>
See notes to consolidated financial statements.
</TABLE>
<PAGE>
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
NEOGEN CORPORATION AND SUBSIDIARIES
<TABLE>
<CAPTION>
Nine Months Ended February 28
1998 1997
------------ ------------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 1,976,578 $ 1,317,830
Adjustments to reconcile net income to net cash
provided from (used in) operating activities:
Depreciation and amortization 510,187 418,042
Changes in operating assets and
liabilities:
Accounts receivable (630,367) (390,086)
Inventories (493,111) (178,034)
Other current assets (43,751) (31,754)
Accounts payable 135,235 262,317
Other accrued liabilities (216,596) 165,227
------------ ------------
NET CASH PROVIDED FROM
OPERATING ACTIVITIES 1,238,175 1,563,542
INVESTING ACTIVITIES:
Purchases of property and equipment
and other assets (535,807) (405,717)
Purchases of marketable securities (15,707,804) (32,985,923)
Proceeds from sale of marketable securities 18,414,242 22,352,660
Acquisition of businesses (3,642,837) (53,122)
------------ ------------
NET CASH USED IN
INVESTING ACTIVITIES (1,472,206) (11,092,102)
FINANCING ACTIVITIES:
Net payments on short-term borrowings 0 (1,043,946)
Payments on long-term borrowings (43,683) (53,361)
Proceeds from issuance
of common stock 347,032 10,342,531
------------ ------------
NET CASH PROVIDED FROM
FINANCING ACTIVITIES 303,349 9,245,224
------------ ------------
INCREASE (DECREASE) IN CASH 69,318 (283,336)
CASH AT BEGINNING OF PERIOD 718,864 625,992
------------ ------------
CASH AT END OF PERIOD $ 788,182 $ 342,656
============ ============
<FN>
See notes to consolidated financial statements.
</TABLE>
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NEOGEN CORPORATION AND SUBSIDIARIES
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form-10QSB and
Item 310 of Regulation S-B. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management,
all adjustments (consisting only of normal recurring accruals) considered
necessary for a fair presentation have been included. The results of
operations for the nine months ended February 28, 1998 are not necessarily
indicative of the results to be expected for the fiscal year ending May 31,
1998. For more complete financial information, these consolidated financial
statements should be read in conjunction with the May 31, 1997 audited
consolidated financial statements and the notes thereto included in the
Company's annual report on Form 10-KSB for the year ended May 31, 1997.
NOTE B - NET INCOME PER SHARE
In 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 128, Earnings per Share. Statement 128
replaced the previously reported primary and fully diluted earnings per share
with basic and diluted earnings per share. Unlike primary earnings per share,
basic earnings per share excludes any dilutive effects of options, warrants,
and convertible securities. Diluted earnings per share is very similar to the
previously reported fully diluted earnings per share. All earnings per share
amounts for all periods have been presented, and where necessary, restated to
conform to the Statement 128 requirements.
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NEOGEN CORPORTATION AND SUBSIDIARIES
The following table sets forth the computation of basic and diluted earnings
per share:
<TABLE>
<CAPTION>
Three Months Ended February 28 Nine Months Ended February 28
1998 1997 1998 1997
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Numerator for basic and
diluted earnings per share:
Net Income $ 657,285 $ 504,331 $1,976,578 $1,317,830
========== ========== ========== ==========
Denominator:
Denominator for basic
earnings per share - weighted
average shares 6,204,225 6,104,726 6,166,578 5,311,279
Effect of dilutive securities:
Employee stock options 214,394 118,606 200,551 124,403
Warrants 25,399 17,538 23,453 17,839
---------- ---------- ---------- ----------
Dilutive potential common stock 239,793 136,144 224,004 142,242
Denominator for diluted
earnings per share - adjusted
weighted average shares and
assumed conversions 6,444,018 6,240,870 6,390,582 5,453,521
========== ========== ========== ==========
Basic earnings per share $ 0.11 $ 0.08 $ 0.32 $ 0.25
========== ========== ========== ==========
Diluted earnings per share $ 0.10 $ 0.08 $ 0.31 $ 0.24
========== ========== ========== ==========
</TABLE>
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NEOGEN CORPORATION AND SUBSIDIARIES
NOTE C - ACQUISITIONS
Effective July 1, 1997, Neogen acquired certain assets of Triple Crown, a
division of W.J. Bartus, Inc. of Fort Pierce, Florida. The acquisition was
accounted for by the purchase method and all acquired assets, consisting of
inventory, fixed assets and 20 related products were moved to the Company's
Lexington, Kentucky division.
The initial purchase price consisted of a cash payment of approximately
$1,400,000. Additional consideration may be paid based upon operating
performance for the twelve month period ending June 1998.
Effective December 30, 1997, Neogen acquired certain assets of Vetoquinol,
U.S.A., Inc. located in Tampa, Florida. The acquisition was accounted for by
the purchase method. Neogen plans to continue to operate the production
facility in Tampa and has relocated all sales and administrative functions to
the company's Lexington, Kentucky facility.
The purchase price consisted of initial consideration of approximately
$2,035,000 in cash paid at closing. A second cash payment not to exceed
$212,000 will be paid in April, 1998. Additional consideration not to exceed
$200,000 may be paid based upon operating performance for the twelve month
periods ending December 31, 1998 and 1999.
NOTE D - NOTES PAYABLE
In December, 1997 the company signed a new loan agreement for its existing
term loan and installment note payable with Comerica Bank. The term loan and
installment note payable were combined into a new variable rate installment
note in the amount of $243,344. The new installment note is unsecured and is
payable in 60 monthly installments of $4,056 plus interest at the prime rate
less .50% (prime rate was 8.5% at February 28, 1998)
The company also renewed a $1,000,000 line of credit with First Chicago - NBD
Bank in December, 1997 at essentially the same terms and conditions that
existed prior to the renewal. There are no borrowings against this line.
In March, 1998 the company entered into a new loan agreement with Comerica
Bank to provide; (1) a $1,500,000 unsecured working capital line of credit
which replaced the company's existing $1,500,000 line of credit with Comerica
Bank and; (2) a new $7,500,000 unsecured line of credit for corporate
acquisitions. Both of these lines bear interest at the prime rate less .50%
and the company currently has no borrowings against either of these lines of
credit.
The terms of certain financing agreements contain, among other provisions,
the requirements to meet certain financial ratios and levels of working
capital and tangible net worth, and restrict the payment of dividends.
<PAGE>
ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
Three Months Ended February 28, 1998 Compared To Three Months Ended February
28, 1997.
Sales for the quarter ended February 28, 1998 were 27% higher than the same
quarter in 1997. Sales of diagnostic products were up $839,000 in the third
quarter representing an increase of 32% and sales of veterinary instruments
increased $126,000 or 13%.
The increase in diagnostic product sales was due to several factors. The
acquisitions of certain assets of W.J. Bartus, Inc. ("Triple Crown")
effective July 1, 1997 and certain assets of Vetoquinol, U.S.A. ("Immunovet")
effective December 30, 1997 resulted in increased sales of $742,000 for the
quarter. Greater demand for test kits and other products sold to the
professional equine market contributed $120,000 in higher sales. Sales of
test kits and reagents for pharmacologics were $42,000 higher than the prior
year. Diagnostic test kits sold to the meat and poultry market for the
detection of microorganisms increased $150,000 or 91% in the third quarter
compared to the same period last year.
The increase in veterinary instrument sales was primarily the result of sales
to a new customer of specialty syringes and needles used by retail consumers
to inject marinades and spices into various red and white meats.
The aforementioned increases in diagnostic product sales were offset by a
$123,000 or 18% decrease in sales of test kits and readers to detect
vomitoxin. As discussed in the company's 10-KSB for the year ended May 31,
1997, last year's midwest winter wheat crop contained high levels of
vomitoxin and management believed sales of test kits for this harmful residue
would decline in the current fiscal year. Sales of other test kits to detect
mycotoxins were $69,000 below last year due primarily to a grain harvest this
year that, for the most part, was free of harmful, naturally occurring
mycotoxins.
Cost of goods sold increased $543,000 in the third quarter due primarily to
the overall increase in product sales. Raw material expense was 26% of sales
compared to 23% in the same period last year due to a change in sale mix.
Sales of products sold to the professional equine market, including sales
derived for the acquisition of Triple Crown, have a higher raw material cost
than sales of diagnostic test kits used for the detection of vomitoxin and
other harmful mycotoxins.
Sales and marketing expenses increased $171,000 compared to the prior year
exclusively due to higher costs associated with marketing products to the
professional equine market. Salaries, fringe, recruiting, relocation, and
travel expenses were $125,000 higher due to increased staffing. Commissions
and royalty expense increased $48,000 as a direct result of higher sales.
General and administrative expenses were $88,000 higher in the third quarter
primarily as a result of increases in cost for two categories. Consulting
expense was $81,000 higher in the third quarter due to contract services
associated with a new computer installation and also due to management
consulting pertaining to the company's Ampcor Diagnostic subsidiary.
<PAGE>
In addition, legal and professional fees increased $84,000 compared to the
prior year. Although the company is a party to ordinary routine litigation
incidental to its business, there are no pending material adverse legal
proceedings. The increase in expense in these two categories was partially
offset by lower recruiting and relocation expense ($57,000) compared to last
year and a reduction in Michigan Single Business Tax ($19,000) compared to
the prior year.
The relatively small $27,000 increase in research expense in the third
quarter was due to higher cost in several categories including salaries,
contract services and consulting. The company believes research and
development is critical to its future an expects research expense to
approximate 9% of total revenues in future periods.
Other income declined slightly compared to the prior year due to a decrease
in interest income. The company had lower cash balances to invest as a result
of the acquisitions of Triple Crown and Immunovet.
During the third quarter, the company adjusted its liability for federal
income taxes based on its actual tax liability for the fiscal year ended May
31, 1997 and revised estimates of taxable income for the current fiscal year.
The adjustment resulted in recognition of a tax benefit amounting to
approximately $15,000 in the third quarter.
Nine Months Ended February 28, 1998 Compared to Nine Months Ended February
28, 1997.
Total revenues for the nine months ended February 28, 1998 were $2,216,000 or
20% higher than the same period in 1997. Sales of diagnostic products
increased $2,062,000 or 23% and veterinary instruments sales increased
$177,000 or 7%.
Of the $2,062,000 increase in diagnostic sales, $1,524,000 was due to the
acquisitions of Immunovet, effective December 30, 1997 and Triple Crown,
effective July 1, 1997. Test kits and other products sold to the professional
equine market were $522,000 higher than last year while sales of test kits
and reagents for pharmacologics were up $163,000. In addition, sales of test
kits to detect microorganisms increased $641,000 or 104% compared to the
prior year.
Offsetting these increases in diagnostic product sales was a $699,000 or 23%
decline in sales of diagnostic test kits and readers for the detection of
vomitoxin. Management discussed its belief that sales of vomitoxin test kits
would likely decline in the current fiscal year in the company's Form 10-KSB
for the year ended May 31, 1997.
As discussed earlier in this 10QSB, veterinary instrument sales were higher
primarily due to shipments to a new customer of specialty syringes and
needles used by retail customers to inject marinades and spices into various
red and white meats.
Cost of goods sold increased $1,252,000 in the first nine months, mostly as a
result of the overall increase in product sales. In addition, raw material
expense increased substantially due to a change in sales mix. Sales of
products sold to the professional equine market, which carry a higher
material cost, increased significantly while sales of diagnostic test kits to
detect vomitoxin, which have a much lower material cost, declined. Management
expects raw material cost to continue to run higher in the current fiscal
year than in the prior year due to sales mix.
<PAGE>
Sales and marketing expenses were up $318,000 during the first nine months
compared to the prior year. Increases in salaries, fringe, recruiting,
relocation, commissions, royalties, printing, travel, advertising and
promotions totaling approximately $393,000 and related to increases in sales
of professional equine products, including the acquisitions of Triple Crown
and Immunovet, were partially offset by lower royalties associated with sales
of diagnostic test kits for mycotoxins.
Approximately $260,000 of the $303,000 increase in general and administrative
expense compared to the prior year was due to increases in consulting
($140,000) and legal and professional fees ($120,000) as discussed earlier in
this 10Q-SB. The company is a party to ordinary routine litigation incidental
to its business, but there are no pending material adverse legal proceedings.
Other income (expense) was $328,000 higher for the first nine months than
last year. In October 1996, the Company completed a public offering of common
stock. A portion of the proceeds was used to pay down short-term bank
borrowings, resulting in lower interest expense. The remaining proceeds were
invested in short-term marketable securities, which has resulted in higher
interest income. In addition, the Company's share of royalties, paid to an
affiliated partnership, increased significantly during the first nine months
compared to the prior year.
Financial Condition and Liquidity
At February 28, 1998 the Company had $10,407,000 in cash and marketable
securities, working capital of $16,806,000 and stockholders' equity of
$23,337,000. In addition, the Company has bank lines of credit totaling
$10,000,000 with nothing borrowed against these lines as of February 28,
1998. Cash and marketable securities decreased $2,637,000 during the first
nine months primarily as a result of the acquisitions of certain assets of
W.J. Bartus, Inc. and Vetoquinol U.S.A., Inc.. Effective July 1, 1997 the
Company acquired substantially all of the assets of Triple Crown
Pharmaceuticals, a division of W.J. Bartus, Inc. of Ft. Pierce, Florida. The
initial purchase price consisted of a cash payment of approximately
$1,400,000 paid in July, 1997. Effective December 30, 1997 the company
acquired certain assets of Vetoquinol, U.S.A., Inc. located in Tampa,
Florida. The initial purchase price consisted of a cash payment of
approximately $2,035,000 paid at closing and a second cash payment not to
exceed $212,000 to be paid in April, 1998.
Accounts receivable are higher at February 28, 1998 than May 31, partially as
a result of the aforementioned acquisitions and partially because of
significant sales volume during the last two weeks of the quarter ended
February 28, 1998 at all of the company's operating units. Inventories are
higher at February 28, 1998 than at May 31 as a result of the acquisitions,
to support increases in sales of professional equine products and in
anticipation of future increases in sales volume.
Other current assets increased $55,000 at February 28, 1998 compared to May
31, 1997, partially due to an overall increase in business volume, partially
as a result of the acquisitions, and partially due to a $30,000 deposit
pertaining to Bot Tox B, a vaccine sold by the company to prevent type B
botulism in horses. The deposit was returned to the company in April, 1998.
The increase in goodwill and other non-current assets at February 28, 1998
compared to May 31, 1997 was due to the previously discussed acquisitions.
Accounts payable increased $135,000
<PAGE>
between May 31 and November 30 due primarily to the timing of month-end
cut-offs and scheduled payment dates for trade payables.
Other accrued liabilities declined $217,000 at February 28, 1998 compared to
May 31, 1997. Lower accruals for salaries and bonuses at February 28
accounted for $130,000 of this decline. In addition, accrued liabilities for
federal income taxes and Michigan Single Business Tax were $53,000 lower at
February 28, 1998 than at May 31, 1997.
The Company did not borrow any additional funds during the first nine months
and made scheduled payments on long-term debt totaling $43,683. Neogen
expended approximately $536,000 in the first nine months for additions to
property, equipment and other assets. At February 28,1998 the Company had no
material commitments for capital expenditures. Inflation and changing prices
are not expected to have a material effect on the Company's operations.
Neogen has been profitable for nineteen of its last twenty quarters and has
generated positive cash flows from operations during this period. Management
believes that the Company's existing cash and marketable securities at
February 28, 1998, along with its available bank lines of credit and cash
expected to be generated from future operations, will be sufficient to fund
activities for the foreseeable future. However, existing cash and marketable
securities may not be sufficient to meet the Company's cash requirements to
commercialize products currently under development or its plans to acquire
additional technology and products that fit within the Company's mission
statement. Accordingly, the Company may be required to issue equity
securities or enter into other financing arrangements for a portion of the
Company's future capital needs.
<PAGE>
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibit Index
Exhibit 4 - Instruments defining the rights of security
holders incorporated by reference from Exhibit 3 (a) (2) of
the Second Amendment to the Form S-18 Registration
Statement filed on August 22, 1989.
Exhibit 27 - Financial Data Schedules For Quarters Ended
August 31, 1997 and 1996, November 30, 1997 and 1996,
February 28, 1998 and 1997, and Year Ended May 31, 1997.
(b) Reports On Form 8-K Filed In Quarterly Period Ended
February 28, 1998.
The Company did not file any reports on Form 8-K in the
quarterly period ended February 28, 1998.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NEOGEN CORPORATION
April 3, 1998 /S/ James L. Herbert
- ----------------------- ---------------------
Date James L. Herbert
President
April 3, 1998 /S/ Lon M. Bohannon
- ----------------------- ---------------------
Date Lon M. Bohannon
Vice President - Chief Financial Officer
<PAGE>
EXHIBIT INDEX
Exhibits Filed Herewith
EXHIBIT NO. DESCRIPTION
- ----------- -----------
27 Financial Data Schedules For Quarters Ended August 31, 1997
and 1996, November 30, 1997 and 1996, February 28, 1998 and
1997 and Year Ended May 31, 1997.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE NEOGEN CORPORATION FORM 10-QSB FOR
THE QUARTER ENDED FEBRUARY 28, 1998 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FORM 10-QSB
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAY-31-1998
<PERIOD-START> JUN-01-1997
<PERIOD-END> FEB-28-1998
<CASH> 788,182
<SECURITIES> 9,618,475
<RECEIVABLES> 3,425,393
<ALLOWANCES> 278,982
<INVENTORY> 4,517,265
<CURRENT-ASSETS> 18,478,276
<PP&E> 5,253,965
<DEPRECIATION> 3,301,307
<TOTAL-ASSETS> 25,347,037
<CURRENT-LIABILITIES> 1,672,763
<BONDS> 0
0
0
<COMMON> 993,261
<OTHER-SE> 22,343,549
<TOTAL-LIABILITY-AND-EQUITY> 25,347,037
<SALES> 13,598,455
<TOTAL-REVENUES> 13,598,455
<CGS> 5,764,834
<TOTAL-COSTS> 12,230,915
<OTHER-EXPENSES> (678,985)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 16,047
<INCOME-PRETAX> 2,030,478
<INCOME-TAX> 53,900
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<TABLE> <S> <C>
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<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE NEOGEN CORPORATION FORM 10-QSB FOR
THE QUARTER ENDED NOVEMBER 30, 1997 AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FORM 10-QSB
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<RESTATED>
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<S> <C>
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0
0
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<INCOME-CONTINUING> 1,319,293
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<CHANGES> 0
<NET-INCOME> 1,319,293
<EPS-PRIMARY> 0.21
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</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE NEOGEN CORPORATION FORM 10-QSB FOR
THE QUARTER ENDED AUGUST 31, 1997 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FORM 10-QSB
</LEGEND>
<RESTATED>
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<S> <C>
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<FISCAL-YEAR-END> MAY-31-1998
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<TOTAL-ASSETS> 23,809,747
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0
0
<COMMON> 984,033
<OTHER-SE> 20,766,936
<TOTAL-LIABILITY-AND-EQUITY> 23,809,747
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<TOTAL-REVENUES> 4,427,082
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<TOTAL-COSTS> 3,990,401
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<NET-INCOME> 630,595
<EPS-PRIMARY> 0.10
<EPS-DILUTED> 0.10
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE NEOGEN CORPORATION FORM 10-QSB FOR
THE YEAR ENDED MAY 31, 1997 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FORM 10-QSB
</LEGEND>
<RESTATED>
<MULTIPLIER> 1
<S> <C>
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<FISCAL-YEAR-END> MAY-31-1997
<PERIOD-START> JUN-01-1996
<PERIOD-END> MAY-31-1997
<CASH> 718,864
<SECURITIES> 12,324,913
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<ALLOWANCES> 320,000
<INVENTORY> 3,620,200
<CURRENT-ASSETS> 19,041,575
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<DEPRECIATION> 2,965,190
<TOTAL-ASSETS> 23,148,473
<CURRENT-LIABILITIES> 1,776,598
<BONDS> 0
0
0
<COMMON> 977,697
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<TOTAL-LIABILITY-AND-EQUITY> 23,148,473
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<NET-INCOME> 1,811,501
<EPS-PRIMARY> 0.33
<EPS-DILUTED> 0.32
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE NEOGEN CORPORATION FORM 10-QSB FOR
THE NINE MONTHS ENDED FEBRUARY 28, 1997 AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FORM 10-QSB
</LEGEND>
<RESTATED>
<MULTIPLIER> 1
<S> <C>
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<FISCAL-YEAR-END> MAY-31-1997
<PERIOD-START> JUN-01-1996
<PERIOD-END> FEB-28-1997
<CASH> 342,656
<SECURITIES> 12,190,304
<RECEIVABLES> 2,343,267
<ALLOWANCES> 310,000
<INVENTORY> 3,556,705
<CURRENT-ASSETS> 18,473,568
<PP&E> 4,388,921
<DEPRECIATION> 2,868,953
<TOTAL-ASSETS> 22,521,742
<CURRENT-LIABILITIES> 1,672,653
<BONDS> 0
0
0
<COMMON> 977,601
<OTHER-SE> 19,540,464
<TOTAL-LIABILITY-AND-EQUITY> 22,521,742
<SALES> 11,360,260
<TOTAL-REVENUES> 11,382,795
<CGS> 4,512,765
<TOTAL-COSTS> 10,342,122
<OTHER-EXPENSES> (394,937)
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<INTEREST-EXPENSE> 59,880
<INCOME-PRETAX> 1,375,730
<INCOME-TAX> 57,900
<INCOME-CONTINUING> 1,317,830
<DISCONTINUED> 0
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<CHANGES> 0
<NET-INCOME> 1,317,830
<EPS-PRIMARY> 0.25
<EPS-DILUTED> 0.24
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE NEOGEN CORPORATION FORM 10-QSB FOR
THE SIX MONTHS ENDED NOVEMBER 30, 1996 AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FORM 10-QSB
</LEGEND>
<RESTATED>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAY-31-1997
<PERIOD-START> JUN-01-1996
<PERIOD-END> NOV-30-1996
<CASH> 318,991
<SECURITIES> 11,636,872
<RECEIVABLES> 2,374,899
<ALLOWANCES> 280,000
<INVENTORY> 3,528,540
<CURRENT-ASSETS> 17,930,254
<PP&E> 4,238,877
<DEPRECIATION> 2,772,499
<TOTAL-ASSETS> 21,984,260
<CURRENT-LIABILITIES> 1,662,360
<BONDS> 0
0
0
<COMMON> 976,039
<OTHER-SE> 18,997,050
<TOTAL-LIABILITY-AND-EQUITY> 21,984,260
<SALES> 7,780,803
<TOTAL-REVENUES> 7,796,085
<CGS> 3,033,898
<TOTAL-COSTS> 7,043,640
<OTHER-EXPENSES> (148,814)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 53,160
<INCOME-PRETAX> 848,099
<INCOME-TAX> 34,600
<INCOME-CONTINUING> 813,499
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 813,499
<EPS-PRIMARY> 0.17
<EPS-DILUTED> 0.16
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE NEOGEN CORPORATION FORM 10-QSB FOR
THE QUARTER ENDED AUGUST 31, 1996 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FORM 10-QSB
</LEGEND>
<RESTATED>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAY-31-1997
<PERIOD-START> JUN-01-1996
<PERIOD-END> AUG-31-1996
<CASH> 2,389,129
<SECURITIES> 0
<RECEIVABLES> 2,386,922
<ALLOWANCES> 259,000
<INVENTORY> 3,387,907
<CURRENT-ASSETS> 8,261,756
<PP&E> 4,106,831
<DEPRECIATION> 2,677,868
<TOTAL-ASSETS> 12,324,043
<CURRENT-LIABILITIES> 2,602,354
<BONDS> 0
0
0
<COMMON> 735,687
<OTHER-SE> 8,619,404
<TOTAL-LIABILITY-AND-EQUITY> 12,324,043
<SALES> 4,030,363
<TOTAL-REVENUES> 4,034,923
<CGS> 1,546,190
<TOTAL-COSTS> 3,618,951
<OTHER-EXPENSES> (27,458)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 30,968
<INCOME-PRETAX> 412,462
<INCOME-TAX> 11,703
<INCOME-CONTINUING> 400,759
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 400,759
<EPS-PRIMARY> 0.09
<EPS-DILUTED> 0.08
</TABLE>
