SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1998, or
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________to___________
__________________
Commission file number 0-17272
__________________
TECHNE CORPORATION
(Exact name of registrant as specified in its charter)
MINNESOTA 41-1427402
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
614 MCKINLEY PLACE N.E. (612) 379-8854
MINNEAPOLIS, MN 55413 (Registrant's telephone number,
(Address of principal (Zip Code) including area code)
executive offices)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 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 ( )
At February 1, 1999, 20,088,355 shares of the Company's Common Stock (par
value $.01) were outstanding.
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
TECHNE CORPORATION & SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
12/31/98 6/30/98
------------ ------------
ASSETS
Cash and cash equivalents $ 13,651,175 $ 27,372,345
Short-term investments 12,100,711 15,321,935
Accounts receivable (net) 12,281,320 10,001,937
Inventories 8,614,812 3,810,600
Deferred income taxes 1,825,000 1,583,000
Other current assets 567,302 431,187
------------ ------------
Total current assets 49,040,320 58,521,004
Deferred income taxes 2,347,000 1,798,000
Fixed assets (net) 12,454,899 11,687,300
Intangible assets (net) 50,341,749 293,854
Other assets 446,800 618,723
------------ ------------
TOTAL ASSETS $114,630,768 $ 72,918,881
============ ============
LIABILITIES & EQUITY
Trade accounts payable $ 2,908,066 $ 2,203,130
Salary and related accruals 1,394,560 2,005,428
Other payables 5,848,454 1,039,334
Income taxes payable 2,518,020 2,185,122
------------ ------------
Total current liabilities 12,669,100 7,433,014
Deferred rent 1,809,300 1,655,100
Royalty payable 13,382,000 -
Common stock, par value $.01 per
share; authorized 50,000,000;
issued and outstanding
20,058,509 and 19,049,983,
respectively 200,585 190,500
Additional paid-in capital 31,634,868 13,714,445
Retained earnings 54,483,713 49,446,319
Accumulated foreign currency
translation adjustments 451,202 479,503
------------ ------------
Total stockholders' equity 86,770,368 63,830,767
------------ ------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $114,630,768 $ 72,918,881
============ ============
See notes to unaudited Consolidated Financial Statements.
TECHNE CORPORATION & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
QUARTER ENDED SIX MONTHS ENDED
------------------------ ------------------------
12/31/98 12/31/97 12/31/98 12/31/97
----------- ----------- ----------- -----------
Sales $21,464,259 $15,472,857 $42,799,451 $31,010,000
Cost of sales 6,228,253 4,885,856 12,843,130 9,431,762
----------- ----------- ----------- -----------
Gross margin 15,236,006 10,587,001 29,956,321 21,578,238
Operating expenses
(income):
Selling, general and
administrative 4,468,183 3,850,195 8,899,278 7,853,599
Research and development 2,941,986 2,515,658 5,694,111 4,981,506
Amortization expense 2,394,662 9,663 4,789,324 52,134
Interest income (230,672) (286,499) (443,083) (530,367)
----------- ----------- ----------- -----------
9,574,159 6,089,017 18,939,630 12,356,872
----------- ----------- ----------- -----------
Earnings before
income taxes 5,661,847 4,497,984 11,016,691 9,221,366
Income taxes 2,075,000 1,370,000 3,905,000 2,831,000
----------- ----------- ----------- -----------
NET EARNINGS $ 3,586,847 $ 3,127,984 $ 7,111,691 $ 6,390,366
=========== =========== =========== ===========
BASIC EARNINGS PER SHARE $ 0.18 $ 0.17 $ 0.35 $ 0.34
DILUTED EARNINGS PER SHARE $ 0.17 $ 0.16 $ 0.35 $ 0.33
See notes to unaudited Consolidated Financial Statements.
TECHNE CORPORATION & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
SIX MONTHS ENDED
----------------------------
12/31/98 12/31/97
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings $ 7,111,691 $ 6,390,366
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amortization 5,871,521 1,121,240
Deferred income taxes (795,000) (273,000)
Deferred rent 154,200 356,400
Tax benefit from exercise of options 179,000 44,000
Other 321,923 273,187
Change in current assets and current
liabilities, net of acquisition:
(Increase) decrease in:
Accounts receivable (2,246,896) 322,086
Inventories 902,067 61,271
Other current assets (136,175) (41,986)
Increase (decrease) in:
Trade account/other payables (60,760) 650,478
Salary and related accruals (612,880) (68,409)
Income taxes payable 339,183 91,008
----------- -----------
NET CASH PROVIDED BY OPERATING ACTIVITIES 11,027,874 8,926,641
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition (Note B) (24,977,219) -
Purchase of short-term investments (7,277,214) (14,547,334)
Proceeds from sale of short-term investments 10,498,438 8,206,450
Additions to fixed assets (1,525,295) (1,648,881)
Proceeds from sale of fixed assets - 246,728
Increase in other long term assets (150,000) -
----------- -----------
NET CASH USED IN INVESTING ACTIVITIES (23,431,290) (7,743,037)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock 752,894 367,796
Repurchase of common stock (2,075,683) (280,000)
----------- -----------
NET CASH (USED IN) PROVIDED BY
FINANCING ACTIVITIES (1,322,789) 87,796
EFFECT OF EXCHANGE RATE CHANGES ON CASH 5,035 30,400
----------- -----------
NET CHANGE IN CASH AND EQUIVALENTS (13,721,170) 1,301,800
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD 27,372,345 8,598,367
----------- -----------
CASH AND EQUIVALENTS AT END OF PERIOD $13,651,175 $ 9,900,167
=========== ===========
See notes to unaudited Consolidated Financial Statements.
TECHNE CORPORATION & SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
A. BASIS OF PRESENTATION:
The unaudited Consolidated Financial Statements have been prepared in
accordance with generally accepted accounting principles and with
instructions to Form 10-Q and Article 10 of Regulation S-X. The
accompanying unaudited Consolidated Financial Statements reflect all
adjustments which are, in the opinion of management, necessary to a fair
presentation of the results for the interim periods presented. All such
adjustments are of a normal recurring nature.
A summary of significant accounting policies followed by the Company is
detailed in the Annual Report to Shareholders for Fiscal 1998. The Company
follows these policies in preparation of the interim Financial Statements.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. It is suggested that the
Consolidated Financial Statements be read in conjunction with the Company's
Consolidated Financial Statements and Notes thereto for the fiscal year
ended June 30, 1998 included in the Company's Annual Report to Shareholders
for Fiscal 1998.
Certain Consolidated Balance Sheet captions appearing in this interim
report are as follows:
12/31/98 6/30/98
----------- -----------
ACCOUNTS RECEIVABLE
Accounts receivable $12,550,320 $10,270,937
Less reserve for bad debts 269,000 269,000
----------- -----------
NET ACCOUNTS RECEIVABLE $12,281,320 $10,001,937
=========== ===========
INVENTORIES
Raw materials $ 1,992,540 $ 2,125,365
Supplies 181,328 145,539
Finished goods 6,440,944 1,539,696
----------- -----------
TOTAL INVENTORIES $ 8,614,812 $ 3,810,600
=========== ===========
FIXED ASSETS
Laboratory equipment $10,927,794 $ 9,944,951
Office equipment 3,077,207 2,923,110
Leasehold improvements 10,924,938 10,243,142
----------- -----------
24,929,939 23,111,203
Less accumulated depreciation
and amortization 12,475,040 11,423,903
----------- -----------
NET FIXED ASSETS $12,454,899 $11,687,300
=========== ===========
INTANGIBLE ASSETS
Customer lists $18,010,000 $ 1,010,000
Technology licensing agreements 500,000 500,000
Goodwill 39,062,766 1,225,547
----------- -----------
57,572,766 2,735,547
Less accumulated amortization 7,231,017 2,441,693
----------- -----------
NET INTANGIBLE ASSETS $50,341,749 $ 293,854
=========== ===========
Effective July 1, 1998, the Company adopted Statement of Financial
Accounting Standards No. 130, "Reporting Comprehensive Income," which
requires disclosures of comprehensive income and its components in the
Company's financial statements. The Company's total comprehensive income
for the quarters ended December, 1998 and 1997 were $3,418,159 and
$3,239,763, respectively. The Company's total comprehensive income for the
six months ended December 31, 1998 and 1997 were $7,083,390 and $6,379,860,
respectively. The Company's comprehensive income consists of net income,
unrealized holding gains and losses on securities and foreign currency
translation adjustments.
On June 30, 1999, the Company will adopt Statement of Financial
Accounting Standards No. 131, "Disclosures about Segments of an Enterprise
and Related Information," which requires the disclosure of financial and
descriptive information about the reportable operating segments of the
Company.
B. ACQUISITION:
On July 1, 1998, the Company, through its Research and Diagnostics Systems,
Inc. subsidiary, acquired the research products business of Genzyme
Corporation. Assets acquired were as follows:
Inventories $ 5,660,000
Equipment 320,000
Customer list 17,000,000
-----------
$22,980,000
===========
The purchase price paid and payable for the acquisition is as follows:
$24.76 million cash, 987,206 shares of Techne common stock valued at $17
million and $18.84 million of royalties (present value of an estimated
$23.7 million payable over five years) on the Company's biotechnology
sales. The excess of the consideration (including acquisition costs) over
the fair market value of the assets acquired has been recorded as goodwill
and is being amortized on a straight-line basis over six years. The
customer list is being amortized on a declining basis over an estimated
economic life of five years.
Pro forma financial information for the quarter and six months ended
December 31, 1997, presented as if the acquisition had occurred on July 1,
1997, are as follows (in 000's except earnings per share data):
QUARTER ENDED SIX MONTHS ENDED
------------- ----------------
12/31/97 12/31/97
----------- ----------------
Sales $19,024 $38,082
Net earnings 688 1,785
Basic earnings per share .03 .09
Diluted earnings per share .03 .09
C. EARNINGS PER SHARE:
Shares used in the earnings per share computations are as follows:
QUARTER ENDED SIX MONTHS ENDED
---------------------- ----------------------
12/31/98 12/31/97 12/31/98 12/31/97
---------- ---------- ---------- ----------
Weighted average common shares
outstanding--basic 20,048,267 18,898,817 20,082,018 18,883,475
Dilutive effect of stock
options and warrants 495,235 726,937 461,470 684,750
---------- ---------- ---------- ----------
Average common shares
outstanding--diluted 20,543,502 19,625,754 20,543,488 19,568,225
========== ========== ========== ==========
D. SUBSEQUENT EVENT:
On January 22, 1999, the Company entered into agreements to acquire real
estate which its wholly-owned subsidiary, R&D Systems, currently occupies
in Minneapolis, Minnesota. The purchase price of the properties is
approximately $28 million, which will be paid through the issuance of
100,000 shares of Common Stock and cash of approximately $25.8 million. A
substantial portion of the cash requirement will be obtained through
mortgage financing. The closing of the purchase transaction is expected to
be in July, 1999.
In addition to agreements to purchase the currently occupied properties,
the Company has acquired options on property adjacent to its R&D Systems'
facility to provided future expansion space for the Company.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Results of Operations Quarter and Six Months Ended December 31, 1998
vs. Quarter and Six Months Ended December 31, 1997
Techne Corporation (Techne) has two operating subsidiaries: Research and
Diagnostic Systems, Inc. (R&D Systems) located in Minneapolis, Minnesota
and R&D Systems Europe Ltd. (R&D Europe) located in Abingdon, England. R&D
Systems has two divisions: Biotechnology and Hematology. The Biotechnology
Division manufactures purified cytokines (proteins), antibodies and assay
kits which are sold primarily to biomedical researchers and clinical research
laboratories. The Hematology Division develops and manufactures whole blood
hematology controls and calibrators which are sold to hospital and clinical
laboratories to check the performance of their hematology instruments to
assure the accuracy of hematology test results. R&D Europe sells R&D
Systems' biotechnology products in Europe, both directly and through a sales
subsidiary in Germany. The Company has a foreign sales corporation, Techne
Export Inc.
In November 1997, January 1998 and July 1998, Techne purchased a total of
$3 million of preferred stock of ChemoCentryx, Inc. (CCX), representing
approximately 37% of issued and outstanding voting shares. In addition,
Techne is obligated to purchase up to an additional $2 million of preferred
stock over the next year upon CCX's achievement of certain milestones. After
purchase of the additional preferred shares, Techne will own approximately
49% of the issued and outstanding voting shares (assuming no investment by
other parties). Techne has consolidated CCX into its financial statements
due to the limited amount of cash consideration provided by the holders of
the common shares of CCX. CCX is a new technology and drug development
company working in the area of chemokines. Chemokines are cytokines which
regulate the trafficking patterns of leukocytes, the effector cells of the
human immune system. In conjunction with the equity investment and joint
research efforts, Techne obtains exclusive worldwide research and diagnostic
marketing rights to chemokine proteins, antibodies and receptors discovered
or developed by CCX or R&D Systems.
Net Sales
Net sales for the quarter ended December 31, 1998 were $21,464,259, an
increase of $5,991,402 (39%) from the quarter ended December 31, 1997.
Sales for the six months ended December 31, 1998 increased $11,789,451
(38%) from $31,010,000 to $42,799,451. R&D Systems sales increased
$4,368,189 (40%) and $8,732,439 (38%) for the quarter and six months ended
December 31, 1998, respectively. R&D Europe sales increased $1,623,213
(37%) and $3,057,012 (37%) for the quarter and six months ended December
31, 1998, respectively.
The increase in sales for the quarter and six months was due, in part, to
the acquisition of Genzyme Corporation's research products business on July
1, 1998. Sales of these products were $1,701,770 and $4,164,797 for the
quarter and six months ended December 31, 1998, respectively. In addition,
the increase in consolidated sales for the quarter and six months was due
to increased sales of R&D Systems' cytokines, antibodies and immunoassay
kits to both R&D Systems customers and to former Genzyme customers as they
are converted from Genzyme products to R&D Systems products.
Gross Margins
Gross margins, as a percentage of sales, increased slightly from the prior
year. Margins for the second quarter of fiscal 1999 were 71.0% compared to
68.4% for the same quarter in fiscal 1998. Margins for the six months
ended December 31, 1998 were 70.0% compared to 69.6% for the same period in
fiscal 1998.
R&D Europe gross margins decreased from 48.6% to 46.4% for the quarter and
from 50.6% to 46.6% for the six months ended December 31, 1998 as a result
of the conversion from both manufacturing and sales activities to a sales
only function through the transfer of all manufacturing activities to R&D
Systems during fiscal 1998. Hematology Division gross margins increased
from 42.2% to 47.2% for the quarter and from 45.5% to 46.6% for the six
months ended December 31, 1998 as a result of changes in product mix and
increased volumes. Biotechnology Division gross margins increased from
70.9% to 72.11% for the quarter, but decreased slightly from 72.0% to 71.0%
for the six months ended December 31, 1998. The decrease in Biotechnology
Division gross margins for the six months was a result of lower gross
profit levels on the inventory acquired from Genzyme during the first
quarter of fiscal 1999. In the second quarter, the lower gross profit on
Genzyme products was offset by the increased sales of higher margin R&D
Systems products.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased $617,988 (16%) from
the second quarter of fiscal 1998 to the second quarter of fiscal 1999.
These expenses also increased $1,045,679 (13%) for the first six months of
fiscal 1999. The majority of the increase for the quarter and six months
was due to additional sales personnel added in the U.S. and Europe as a
result of the Genzyme acquisition.
Research and Development Expenses
Research and development expenses increased $426,328 (17%) and $712,605
(14%) for the quarter and six months ended December 31, 1998. The increase
related to products currently under development, many of which have been or
will be released in fiscal 1999. Products currently under development
include both biotechnology and hematology products.
Amortization Expense
Amortization expense increased $2,384,999 and $4,737,190 for the quarter
and six months ended December 31, 1998 as a result of the customer list and
goodwill associated with the Genzyme acquisition.
Net Earnings
Earnings before income taxes increased $1,163,863 from $4,497,984 in the
second quarter of fiscal 1998 to $5,661,847 in the second quarter of fiscal
1999. Earnings before taxes for the six months increased $1,795,325 from
$9,221,366 to $11,016,691. The increase in earnings before income taxes
was due mainly to an increase in Biotechnology Division earnings of $867,983
and $1,722,086, an increase in R&D Europe earnings of $306,745 and $366,627,
and an increase in Hematology Division earnings of $232,478 and $205,050 for
the quarter and six months ended December 31, 1998. These increases were
reduced by a net loss by CCX in the second quarter and first six months of
fiscal 1999.
Income taxes for the quarter and six months ended December 31, 1998 were
provided at a rate of approximately 37% and 35% of consolidated pretax
earnings compared to 30% and 31% for the prior year. The increase in the
tax rate is due to the net loss by CCX in the second quarter and first six
months of fiscal 1999 for which no tax benefit has been provided. U.S.
federal taxes have been reduced by the credit for research and development
expenditures and the benefit of the foreign sales corporation. Foreign
income taxes have been provided at rates which approximate the tax rates in
the United Kingdom and Germany.
Liquidity and Capital Resources
At December 31, 1998, cash and cash equivalents and short-term investments
were $25,751,886 compared to $42,694,280 at June 30, 1998. The decrease
from June 30, 1998 was due to the cash outlay for the Genzyme acquisition.
The Company believes it can meet its future cash, working capital and
capital addition requirements (excluding real estate to be acquired in July,
1999) through currently available funds, cash generated from operations
and maturities of short-term investments. The Company has an unsecured
line of credit of $750,000. The interest rate on the line of credit is at
prime. There were no borrowings on the line in the prior or current fiscal
years.
Cash Flows From Operating Activities
The Company generated cash of $11,027,874 from operating activities in the
first six months of fiscal 1999 compared to $8,926,641 for the first six
months of fiscal 1998. The increase was mainly the result of increased net
earnings adjusted for noncash expenses partially offset by increased accounts
receivable.
Cash Flows From Investing Activities
On July 1, 1998 the Company acquired the research products business of
Genzyme Corporation for $24.76 million cash, $17 million common stock and
royalties on the Company's biotechnology sales for five years. Cash and
cash equivalents at June 30, 1998 and maturities of short-term investments
were used to finance the cash portion of the acquisition.
During the six months ended December 31, 1998 short-term investments
decreased by $3,221,224. During the six months ended December 31, 1997,
the Company increased short-term investments by $6,340,884. The Company's
investment policy is to place excess cash in short-term tax-exempt bonds.
The objective of this policy is to obtain the highest possible return with
the lowest risk, while keeping the funds accessible.
Capital additions were $1,525,295 for the first six months of fiscal 1999,
compared to $1,648,881 for the first six months of fiscal 1998. Included
in the fiscal 1999 and 1998 additions were $683,000 and $721,000 for
leasehold improvements related to remodeling of facilities by R&D Systems.
The remaining additions in fiscal 1999 and 1998 were for laboratory and
computer equipment. Total expenditures for capital additions planned for
the remainder of fiscal 1999 are expected to cost approximately $4.5
million and are expected to be financed through currently available funds
and cash generated from operating activities.
Cash Flows From Financing Activities
Cash of $752,894 and $367,796 was received during the six months ended
December 31, 1998 and 1997, respectively, for the exercise of options for
158,420 and 46,540 shares of common stock. During the first six months of
fiscal 1998, options for 24,506 shares of common stock were exercised by
the surrender of 7,624 shares of the Company's common stock with a fair
market value of $126,194.
During the first six months of fiscal 1999 and 1998, the Company purchased
and retired 138,600 and 20,000 shares, respectively, of Company common
stock at market values of $2,075,683 and $280,000. The Board of Directors
has authorized the Company, subject to market conditions and share price,
to purchase and retire up to $10 million of its common stock. Through
February 1, 1999, 575,600 shares have been purchased at a market value of
$6,887,547.
The Company has never paid cash dividends and has no plans to do so in
fiscal 1999.
ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
At December 31, 1998, the Company had an investment portfolio of fixed
income securities, excluding those classified as cash and cash equivalents,
of $12,100,711. These securities, like all fixed income instruments, are
subject to interest rate risk and will decline in value if market interest
rates increase. However, the Company has the ability to hold its fixed
income investments until maturity and therefore the Company would not
expect to recognize an adverse impact in income or cash flows.
The Company operates internationally, and thus is subject to potentially
adverse movements in foreign currency rate changes. The Company does not
enter into foreign exchange forward contracts to reduce its exposure to
foreign currency rate changes on intercompany foreign currency denominated
balance sheet positions. Historically, the effect of movements in the
exchange rates haS been immaterial to the consolidated operating results of
the Company.
Y2K AND EURO CURRENCY ISSUES
The Company must take steps to ensure that it is not adversely affected by
Y2K software failures which may arise in software applications where two-
year digits are used to define the applicable year. The Company is
conducting a review of all of its computer systems (information technology
as well as embedded systems) to identify those areas that could be affected
by Year 2000 noncompliance. The Company plans to complete the process of
upgrading those systems which may not be Y2K compliant by mid 1999 and does
not believe the cost of any such upgrades will be material. The Company is
in the process of developing contingency plans should systems fail. The
Company has also communicated with many of its suppliers and service
providers regarding compliance with Y2K requirements. As a result of such
inquiries, no significant deficiencies have been identified. The Company
will continue to monitor these third parties for Y2K compliance.
There can be no assurance, however, that there will not be a delay in, or
increased costs associated with, upgrading the Company's computer systems,
which could have a material adverse effect on the operations and financial
position of the Company. In addition, there can be no assurances that the
Company's customers and suppliers will not be adversely affected by their
own Y2K issues, which may indirectly adversely affect the Company.
The Company has implemented new accounting and operational software at its
European subsidiary which accommodated the conversion on January 1, 1999 to
a common currency, the "euro," by members of the European Union. The
software is also Y2K compliant.
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
No change.
ITEM 2 - CHANGES IN SECURITIES
None
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4 - SUBMISSION OF MATTERS TO VOTE OF SHAREHOLDERS
Information relating to the Company's Annual Meeting of Shareholders,
held on October 22, 1998 is contained in the Company's Form 10-Q for
the quarter ended September 30, 1998, which is incorporated herein by
reference.
ITEM 5 - OTHER INFORMATION
Forward Looking Information and Cautionary Statements: Statements in
this filing, and elsewhere, which look forward in time involve risks and
uncertainties which may affect the actual results of operations. The
following important factors, among others, have affected and, in the
future, could affect the Company's actual results: the level of success
in converting customers and distributors of Genzyme Corporation's
research product business to the Company and selling the Company's
broader range of products to the former Genzyme customers and
distributors, the introduction and acceptance of new biotechnology and
hematology products, the levels and particular directions of research
into cytokines by the Company's customers, the impact of the growing
number of producers of cytokine research products and related price
competition, the retention of hematology OEM and proficiency survey
business, the Company's expansion of marketing efforts in Europe, and
the costs and results of research and product development efforts of the
Company and of companies in which the Company has invested or with which
it has formed strategic relationships.
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
A. EXHIBITS
See exhibit index immediately following signature page.
B. REPORTS ON FORM 8-K
No reports on Form 8-K were filed during the quarter ended December
31, 1998.
SIGNATURE
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.
TECHNE CORPORATION
(Company)
Date: February 12, 1998 Thomas E. Oland
--------------------------------
Thomas E. Oland
President, Chief Executive and
Financial Officer
EXHIBIT INDEX
TO
FORM 10-Q
TECHNE CORPORATION
Exhibit # Description
---------- ------------------
10.1 Purchase Agreement dated January 22, 1999,
between R&D Systems, Inc. and Hillcrest Development,
relating to the purchase of property at 614 and 640
McKinley Place NE and 2201 Kennedy Street in
Minneapolis, Minnesota and First Amendment to the
Purchase Agreement, dated February 5, 1999
27 Financial Data Schedule