GlobeNewswire Inc | Mar 10, 2021 07:00AM EST

March 10, 2021

-- Revenue returns to pre-Covid19 levels on strong CRO/pharma sales -- Operating margin increased year-over-year on GAAP and an adjusted basis -- New debt facility significantly reduces annual interest expense

HOLLISTON, Mass., March 10, 2021 (GLOBE NEWSWIRE) -- Harvard Bioscience, Inc. (Nasdaq: HBIO) (the Company) today announced financial results for the three months and year ended December 31, 2020.

Jim Green, Chairman and CEO said, Our fourth quarter demonstrated the benefits of our sales effectiveness focus as we delivered revenue at pre-Covid levels, or $31.0 million. Our preclinical product revenue increased 19% over Q4 2019. In addition, we are very pleased to have successfully refinanced our credit facility which is expected to save approximately $3M annually in cash interest based upon current debt levels and provides numerous other enhancements compared to the former facility.

Green concluded, With strong CRO/Pharma growth and recovering academic lab sales, we expect revenue to grow 8 to 12% compared to 2020. In addition, exciting new products along with removal of lower value offerings is expected to improve our profit mix, delivering adjusted operating margins in the mid-to-upper teens in 2021. We believe the strong 2020 ending and our focus on growth and new exciting products puts 2021 on plan to creating the growth oriented profitable platform we envisioned.



Quarterly Financial Results Q4'20 Q3'20 Q4'19 Summary Revenue $31.0 $24.0 $31.0 million million million Operating Income (GAAP) $2.8 $0.2 $1.6 million million million Adjusted Operating Income $5.8 $3.6 $5.6 million million million Operating Margin (GAAP) 8.9% 0.8% 5.3% Adjusted Operating Margin 18.7% 14.8% 18.1% Diluted (Loss) Earnings Per ($0.02) ($0.03) $0.01 Share (GAAP) Adjusted Diluted Earnings Per $0.08 $0.04 $0.08 Share Net Debt* $41.1 $41.6 $46.7 million million million * Debt outstanding less cash and cash equivalents

Please refer to the exhibits below for a reconciliation of certain non-GAAP to GAAP financial measures, including operating income, net income and loss, and diluted earnings per share. Please see Use of Non-GAAP Financial Information for additional information regarding our use of such adjusted financial information.

Webcast and Conference Call Details

Harvard Bioscience will be hosting a conference call and webcast today at 8:00 a.m. Eastern Time. You can access the live conference call by dialing the following phone numbers: toll-free 1 (877) 303-7611 or international 1 (970) 315-0445 and referencing the conference ID# 4375572.

The conference call will be simultaneously webcast and can be accessed through the Harvard Bioscience website. A slide presentation that will be referenced during the webcast will be posted to our Investor Relations website shortly before the webcast begins. To listen to the webcast, log on to the webcast at: http://investor.harvardbioscience.com/ and click on the Earnings Call icon.

Use of Non-GAAP Financial Information

In this press release, we have included non-GAAP financial information including adjusted operating income, adjusted net income, and adjusted diluted earnings per share. We believe that this non-GAAP financial information provides investors with an enhanced understanding of the underlying operations of the business. For the periods presented, these non-GAAP financial measures have excluded certain expenses and income primarily resulting from purchase accounting or events that we do not believe are related to the underlying operations of the business such as amortization of intangibles related to acquisitions, costs related to acquisition, disposition and integration initiatives, impairment charges, severance, restructuring and other business transformation expenses, and stock-based compensation expense. They also exclude the tax impact of the reconciling items. This non-GAAP financial information approximates information used by our management to internally evaluate the operating results of the Company. Tabular reconciliations of our adjusted operating income, adjusted net income (loss), and adjusted earnings (loss) per diluted share are included as exhibits below in this press release.

The non-GAAP financial information provided in this press release should be considered in addition to, not as a substitute for, the financial information provided and presented in accordance with GAAP and may be different than other companies non-GAAP financial information.

About Harvard Bioscience

Harvard Bioscience is a leading developer, manufacturer and seller of technologies, products and services that enable fundamental research, discovery, and pre-clinical testing for drug development. Our customers range from renowned academic institutions and government laboratories, to the worlds leading pharmaceutical, biotechnology and contract research organizations. With operations in North America, Europe, and China, we sell through a combination of direct and distribution channels to customers around the world.

For more information, please visit our website atwww.harvardbioscience.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995. You can identify these statements by our use of such words as "will," "guidance," "objectives," "optimistic," "potential," "future," "expects," "plans," "estimates," "continue," "drive," "strategy," "potential," "potentially," "growth," "long-term," "projects," "projected," "intends," "believes," "goals," "sees," "seek," "develop" "possible" "new," "emerging," "opportunity," "pursue" and similar expressions that do not relate to historical matters. Forward-looking statements in this press release or that may be made during our conference call may include, but are not limited to, statements or inferences about the Company's or management's beliefs or expectations, the Company's anticipated future revenues and earnings, the strength of the Company's market position and business model, industry outlook, the impact of the COVID-19 pandemic on the Companys business, the Company's business strategy, the positioning of the Company for growth, the market demand and opportunity for the Company's current products, or products it is developing or intends to develop, and the Company's plans, objectives and intentions that are not historical facts. These statements involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Investors should note that many factors, as more fully described under the caption Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2019, and in our Quarterly Reports on Form 10-Q issued in 2020 and in our other filings with the Securities and Exchange Commission and as otherwise enumerated herein or therein may cause the Company's actual results to differ materially from those in the forward-looking statements. The forward-looking statements in this press release are qualified by these risk factors. The Company's results may also be affected by factors of which the Company is not currently aware. The Company may not update these forward-looking statements, even though its situation may change in the future, unless it has obligations under the federal securities laws to update and disclose material developments related to previously disclosed information.

For investor inquiries, please contact Michael A. Rossi, Chief Financial Officer at (508) 893-8999.

Exhibit 1 HARVARD BIOSCIENCE, INC. Consolidated Statements of Operations (unaudited, in thousands, except per share data) Three Months Ended December September December 31, 2020 30, 2020 31, 2019 Revenues $ 30,984 $ 24,037 $ 30,972 Cost of revenues 13,276 10,542 13,738 Gross profit 17,708 13,495 17,234 Operating expenses: Sales and marketing 5,470 4,588 5,894 expenses General and administrative 5,681 5,399 5,545 expenses Research and development 2,349 1,949 2,645 expenses Amortization of 1,452 1,377 1,457 intangible assets Impairment - - 59 charges Total operating 14,952 13,313 15,600 expenses Operating income 2,756 182 1,634 Other expense: Interest expense (1,094 ) (1,205 ) (1,281 ) Debt extinguishment (1,876 ) - - and related costs Other expense, (334 ) (392 ) (255 ) net Total other expense (3,304 ) (1,597 ) (1,536 ) (Loss) income before (548 ) (1,415 ) 98 income taxes Income tax expense 67 (317 ) (452 ) (benefit) Net (loss) income $ (615 ) $ (1,098 ) $ 550 (Loss) earnings per common share: Basic $ (0.02 ) $ (0.03 ) $ 0.01 Diluted $ (0.02 ) $ (0.03 ) $ 0.01 Weighted average common shares: Basic 39,021 38,920 38,068 Diluted 39,021 38,920 39,070

Exhibit 1.1 HARVARD BIOSCIENCE, INC. Consolidated Statements of Operations (unaudited, in thousands, except per share data) Year Ended December 31, 2020 2019 Revenues $ 102,100 $ 116,176 Cost of revenues 44,059 51,854 Gross profit 58,041 64,322 Operating expenses: Sales and marketing expenses 19,916 23,264 General and administrative 23,509 22,760 expenses Research and development 8,685 10,715 expenses Amortization of intangible 5,710 5,746 assets Impairment charges - 1,460 Total operating expenses 57,820 63,945 Operating income 221 377 Other expense: Interest expense (4,831 ) (5,410 ) Debt extinguishment and (1,876 ) - related costs Other expense, net (806 ) (469 ) Total other expense (7,513 ) (5,879 ) Loss before income taxes (7,292 ) (5,502 ) Income tax expense (benefit) 518 (815 ) Net loss $ (7,810 ) $ (4,687 ) Loss per common share: Basic and diluted $ (0.20 ) $ (0.12 ) Weighted average common shares: Basic and diluted 38,640 37,814

Exhibit 2 HARVARD BIOSCIENCE, INC. Condensed Consolidated Balance Sheets (unaudited, in thousands) December 31, December 31, 2020 2019 Assets Cash and cash equivalents $ 8,317 $ 8,335 Accounts receivables 17,766 20,704 Inventories 22,262 22,061 Other current assets 3,355 2,472 Total current assets 51,700 53,572 Property, plant and equipment 3,960 4,776 Goodwill and other intangibles 91,741 95,786 Other long-term assets 8,853 10,736 Total assets $ 156,254 $ 164,870 Liabilities and Stockholders' Equity Current portion, long-term debt $ 1,721 $ 6,900 Other current liabilities 19,332 18,412 Total current 21,053 25,312 liabilities Long-term debt 46,286 46,917 Other long-term liabilities 12,234 10,947 Stockholders? equity 76,681 81,694 Total liabilities and $ 156,254 $ 164,870 stockholders? equity

Exhibit 3 HARVARD BIOSCIENCE, INC. Condensed Consolidated Statements of Cash Flows (unaudited, in thousands) Year Ended December 31, 2020 2019 Cash flows from operating activities: Net loss $ (7,810 ) $ (4,687 ) Adjustments to operating cash 13,035 12,690 flows Changes in operating assets and 4,106 42 liabilities Net cash provided by operating 9,331 8,045 activities Cash flows from investing activities: Additions to property, plant and (1,152 ) (1,216 ) equipment Disposition of business - 1,002 Other investing activities (250 ) (15 ) Net cash used in investing (1,402 ) (229 ) activities Cash flows from financing activities: Proceeds from borrowings 61,315 4,300 Repayments of debt (66,912 ) (11,703 ) Payments of debt extinguishment (1,897 ) - and issuance costs Other financing activities (473 ) (221 ) Net cash used in financing (7,967 ) (7,624 ) activities Effect of exchange rate changes 20 (30 ) on cash (Decrease) increase in cash and (18 ) 162 cash equivalents Cash and cash equivalents at the 8,335 8,173 beginning of year Cash and cash equivalents at the $ 8,317 $ 8,335 end of year

Exhibit 4 HARVARD BIOSCIENCE, INC. Reconciliation of GAAP to Non-GAAP Financial Measures (unaudited) (in thousands, except per share data) Three Months Ended December September December 31, 30, 31, 2020 2020 2019 GAAP operating $ 2,756 $ 182 $ 1,634 income Stock-based compensation 1,006 1,079 841 expense Severance, restructuring and 532 876 1,551 transformation costs Acquired assets amortization and 1,503 1,428 1,575 impairments Adjusted operating $ 5,797 $ 3,565 $ 5,601 income GAAP operating 8.9 % 0.8 % 5.3 % margin Adjusted operating 18.7 % 14.8 % 18.1 % margin GAAP net (loss) $ (615 ) $ (1,098 ) $ 550 income Stock-based compensation 1,006 1,079 841 expense Severance, restructuring and 532 876 1,551 transformation costs Debt extinguishment 1,876 - - and related costs Acquired assets amortization and 1,503 1,428 1,575 impairments Income taxes (A) (1,034 ) (823 ) (1,472 ) Adjusted net income $ 3,268 $ 1,462 $ 3,045 GAAP (loss) earnings per $ (0.02 ) $ (0.03 ) $ 0.01 diluted share Adjusted items after tax per share 0.10 0.07 0.07 assuming dilution Adjusted earnings $ 0.08 $ 0.04 $ 0.08 per diluted share Weighted average diluted common shares: GAAP 39,021 38,920 38,068 Adjusted 40,810 40,307 39,070 (A) Income taxes includes the tax effect of the adjustments to GAAP results.

Exhibit 4.1 HARVARD BIOSCIENCE, INC. Reconciliation of GAAP to Non-GAAP Financial Measures (unaudited) (in thousands, except per share data) Year Ended December 31, 2020 2019 GAAP operating (loss) income $ 221 $ 377 Stock-based compensation 3,647 3,030 expense Severance, restructuring and 4,166 3,943 transformation costs Acquired assets amortization 5,920 7,503 and impairments Adjusted operating income $ 13,954 $ 14,853 GAAP operating margin 0.2% 0.3% Adjusted operating margin 13.7% 12.8% GAAP net loss $ (7,810) $ (4,687) Stock-based compensation 3,647 3,030 expense Severance, restructuring and 4,166 3,943 transformation costs Debt extinguishment and 1,876 - related costs Acquired assets amortization 5,920 7,503 and impairments Income taxes (A) (1,469) (2,766) Adjusted net income $ 6,330 $ 7,023 GAAP loss per diluted share $ (0.20) $ (0.12) Adjusted items after tax per 0.36 0.30 share assuming dilution Adjusted earnings per $ 0.16 $ 0.18 diluted share Weighted average diluted common shares: GAAP 38,640 37,814 Adjusted 39,985 38,373 (A) Income taxes includes the tax effect of the adjustments to GAAP results.