News


Hologic Announces First Quarter Fiscal 2006 Operating Results
Revenues and Backlog Increase to Record Highs
PRNewswire-FirstCall
BEDFORD, Mass.

BEDFORD, Mass., Jan. 24, 2006 /PRNewswire-FirstCall/ -- Hologic, Inc. (NASDAQ: HOLX), a leading provider of state-of-the-art diagnostic and digital imaging systems directed towards women's health, today announced its results for the quarter ended December 24, 2005.

  Highlights of the quarter include:
  * Record revenues of $88 million.
  * Record backlog of $140 million.
  * Record 97 Selenia full field digital mammography systems installed and
    recognized as revenue.

First quarter fiscal 2006 revenues totaled $87,956,000, a 33% increase when compared to revenues of $66,176,000 in the first quarter of fiscal 2005. For the first quarter of fiscal 2006, Hologic reported net income of $5,716,000, or $0.12 per diluted share, compared with net income of $4,574,000, or $0.11 per diluted share, in the first quarter of fiscal 2005. The improvement in quarterly earnings primarily reflects the increase in product sales of Selenia digital mammography systems in the current quarter as compared to the first quarter of fiscal 2005. Earnings per share information for 2005 has been restated to reflect the Company's 2-for-1 stock split effected on November 30, 2005.

Included in our GAAP results for the first quarter of fiscal 2006, are the following expenses that were not incurred in the first quarter of fiscal 2005:

  * a $4.2 million charge to research and development for in-process R&D in
    connection with the acquisition of Fischer Imaging's intellectual
    property relating to its mammography business on September 29, 2005;
  * a $629,000 charge to operating expenses to amortize the intangible
    assets acquired from Fischer Imaging over their useful life; and
  * a $667,000 charge for compensation expense to account for employee stock
    options under FASB Statement 123R.

As expected, the Company fully absorbed in the current quarter the entire expenses of approximately $1.8 million associated with its exhibit at the Radiological Society of North America ("RSNA") medical imaging trade show held in December 2005 which was up slightly from the $1.7 million spent in the first quarter of fiscal 2005.

In the current quarter, Hologic's effective tax rate increased to 37% of pre-tax earnings. This rate is higher than the effective tax rate of 6% in the first quarter of fiscal 2005 and 19% for the full 2005 fiscal year due to the realization of the Company's previously unbenefited deferred tax assets in the fourth quarter of fiscal 2005. The Company expects a more normalized effective tax rate of approximately 37% in fiscal 2006.

During the first quarter, Hologic recognized as revenue 97 Selenia full field digital mammography systems. At December 24, 2005, the Company's backlog for orders of Selenia was 221 systems and total backlog for all products increased to $140 million, the highest quarterly backlog in the Company's history and a 37% increase over the backlog at September 24, 2005.

"We had a solid first quarter, building on the strong momentum we achieved in fiscal 2005," said Jack Cumming, Chairman and CEO. "Our revenue and backlog were both up from the last quarter as we continue to outpace our expectations. These results were driven by the continued demand for our Selenia digital mammography system as more customers are making Hologic their preferred choice."

Beginning in fiscal 2006, the Company combined its previously reported mammography and digital detector operating segments to better reflect how the Company views its operations and manages its business. In fiscal 2006, the primary function of the digital detector business is to support the Company's mammography product line. The Company now has three reporting segments: Mammography, Osteoporosis Assessment and All Other. Segment information for 2005 has been restated to conform to the 2006 presentation.

  First quarter financial overview by segment:

  * Mammography revenues increased 49% to $62,780,000 for the first quarter
    of fiscal 2006 from $42,098,000 for the same period in fiscal 2005.
    This increase was primarily due to continued increasing sales of
    Selenia and to a lesser extent, an increase in sales of MultiCare
    breast biopsy tables.  Operating income for this business segment in
    the first quarter of fiscal 2006 increased to $4,989,000 compared to
    operating income of $1,837,000 in the first quarter of fiscal 2005.
    This increase in operating income in the current quarter was primarily
    due to the significant increase in revenues and the higher gross
    margins on increasing product sales of Selenia.  Costs and expenses in
    2006 include the $4.2 million charge for in-process R&D, $629,000 of
    amortization of intangible assets related to the acquisition of Fischer
    Imaging's intellectual property and $443,000 of stock-based
    compensation under newly-adopted FASB Statement 123R.
  * Osteoporosis assessment revenues increased 17% to $20,020,000 for the
    first quarter of fiscal 2006 from $17,163,000 for the same period in
    fiscal 2005.  This increase was primarily due to an increase in the
    number of bone densitometry systems sold and an increase in service
    revenue.  Operating income for this business segment in the first
    quarter of fiscal 2006 increased to $3,005,000 from $1,633,000 in the
    first quarter of fiscal 2005.  Costs and expenses in 2006 include
    $193,000 of stock-based compensation under newly-adopted FASB Statement
    123R.
  * All other revenues, which includes the Company's mini C-arm, extremity
    MRI, conventional general radiography service and digital general
    radiography systems businesses decreased 25% to $5,155,000 for the
    first quarter of fiscal 2006 from $6,915,000 for the same period in
    fiscal 2005.  The decrease in revenues was primarily due to the
    shipment of fewer digital general radiography systems as this business
    is almost completely phased out.  The operating loss for this business
    segment in the first quarter of fiscal 2006 was $189,000 compared to
    operating income of $1,120,000 in the first quarter of fiscal 2005.
    This decrease in operating income in the current quarter was primarily
    due to a decrease in gross margin dollars from the phase-out of DR
    system sales and an increase in operating expenses primarily from the
    ramp-up of sales and marketing activities for the new line of third
    party extremity MRI systems.  Costs and expenses in 2006 include
    $31,000 of stock-based compensation under newly-adopted FASB Statement
    123R.

Hologic's management will host a conference call today at 10:00 a.m. (Eastern) to discuss first quarter fiscal 2006 operating results. Interested participants may listen to the call by dialing 800-811-0667 or 913-981-4901 for international callers and referencing code 4500505 approximately 15 minutes prior to the call. For those unable to participate in the live broadcast, a replay will be available one hour after the call ends through January 27, 2006 at 888-203-1112 or 719-457-0820 for international callers, access code 4500505. The Company will also provide a live webcast of the call on the investor relations page of the Company's website at http://www.hologic.com/investor. A replay of the call will also be available on the investor relations page of the Company's website http://www.hologic.com/investor shortly after the completion of the live broadcast.

Hologic Inc. is a leading developer, manufacturer and supplier of premium diagnostic and medical imaging systems dedicated to serving the healthcare needs of women, and a leading developer of innovative imaging technology for digital radiography and breast imaging. Hologic's core business units are focused on osteoporosis assessment, mammography and breast biopsy, and mini C- arm and extremity MRI imaging for orthopedic applications. For more information visit http://www.hologic.com/.

This News Release contains forward-looking information that involves risks and uncertainties, including statements regarding the Company's plans, objectives, expectations and intentions. Such statements include, without limitation, statements regarding the Company's expected effective tax rate for fiscal 2006, the Company's expectation for growth during fiscal 2006, and any implication that the Company's backlog may be indicative of future sales. These forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those anticipated. The Company's backlog consists of purchase orders for which delivery is scheduled within the next twelve months, as specified by the customer. In certain circumstances, orders included in backlog may be canceled or rescheduled by customers without significant penalty. Therefore, backlog as of any particular date should not be relied upon as indicative of the Company's net revenues for any future period. Other factors that could cause actual results to materially differ include, without limitation, manufacturing risks that may limit the Company's ability to ramp-up commercial production of the Selenia and other of the Company's digital products, including the Company's reliance on a single source of supply for some key components of its products as well as the need to comply with especially high standards for those components and in the manufacture of digital X-ray products in general; uncertainties inherent in the development of new products and the enhancement of existing products, including technical and regulatory risks, cost overruns and delays; the risk that newly introduced products may contain undetected errors or defects or otherwise not perform as anticipated; the ability of the Company's sales force to successfully service its product offerings; the Company's ability to successfully manage current or future alliances or joint ventures; the Company's ability to predict accurately the demand for its products, and products under development, and to develop strategies to address its markets successfully; the early stage of market development for digital X-ray products; risks relating to acquisitions; expenses and uncertainties relating to litigation; risks relating to compliance with financial covenants under the Company's leases; technical innovations that could render products marketed or under development by the Company obsolete; competition; and reimbursement policies for the use of the Company's products. Other factors that could adversely affect the Company's business and prospects are described in the Company's filings with the Securities and Exchange Commission. Hologic expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statements to reflect any change in the Company's expectations or any change in events, conditions or circumstances on which any such statement is based.

  Contact:
   Glenn P. Muir                      Frances Crecco
   Executive Vice President & CFO     Director, Investor Relations
   Hologic, Inc.                      Hologic, Inc.
   (781) 999-7300                     (781) 999-7377



                      HOLOGIC, INC. AND SUBSIDIARIES
                  CONDENSED CONSOLIDATED BALANCE SHEETS
                               (Unaudited)
                              (In thousands)

                                  ASSETS

                                                December 24, September 24,
                                                    2005           2005
  CURRENT ASSETS:
   Cash and cash equivalents                       $94,514       $113,994
   Accounts receivable, net                         62,119         57,742
   Inventories                                      49,472         44,520
   Prepaid expenses and other current assets        11,760         12,119
    Total current assets                           217,865        228,375

  Property and equipment, net                       34,885         33,329
  Intangible assets, net                            33,066          5,162
  Goodwill, net                                      6,285          6,285
  Other assets, net                                  2,110          6,688
                                                  $294,211       $279,839

                    LIABILITIES AND STOCKHOLDERS' EQUITY

                                                December 24, September 24,
                                                    2005           2005
  CURRENT LIABILITIES:
   Accounts payable                               $ 17,605       $ 14,163
   Accrued expenses                                 19,567         25,237
   Deferred revenue                                 22,263         21,134
    Total current liabilities                       59,435         60,534

  Deferred income tax liabilities                        -          1,471

  STOCKHOLDERS' EQUITY:
   Common stock, $.01 par value-
    Authorized - 90,000 shares
    Issued - 44,869 and 44,295
    shares, respectively                               449            443
   Capital in excess of par value                  183,928        172,642
   Retained earnings                                52,168         46,452
   Cumulative translation adjustment                (1,305)        (1,239)
   Treasury stock, 90 shares at cost                  (464)          (464)
    Total stockholders' equity                     234,776        217,834
                                                  $294,211       $279,839



                      HOLOGIC, INC. AND SUBSIDIARIES
               CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                               (Unaudited)
                  (In thousands, except per share data)

                                                     Three Months Ended
                                                December 24,  December 25,
                                                    2005           2004

  REVENUES                                         $87,956        $66,176

  COSTS AND EXPENSES (1):
   Cost of revenues                                 50,974         41,968
   Research and development                         10,171          4,350
   Selling and marketing                            11,142          9,248
   General and administrative                        7,863          6,020
                                                    80,150         61,586

    Income from operations                           7,806          4,590

  Interest income                                    1,295            259

  Interest expense/other income (expense)              (35)            19

   Income before provision for income taxes          9,066          4,868

  Provision for income taxes                         3,350            294

   Net income                                       $5,716         $4,574

  Net income per common and common equivalent share:
   Basic                                             $0.13         $ 0.11
   Diluted                                           $0.12         $ 0.11

  Weighted average number of common shares outstanding:
   Basic                                            44,351         41,294
   Diluted                                          46,801         43,522


  (1) Stock-based Compensation included
   in Costs and Expenses:
  Cost of revenues                                     $86             $-
  Research and development                              96              -
  Selling and marketing                                 72              -
  General and administrative                           413              -
                                                      $667             $-

SOURCE: Hologic, Inc.

CONTACT: Glenn P. Muir, Executive Vice President & CFO, +1-781-999-7300,
or Frances Crecco, Director, Investor Relations, +1-781-999-7377, both of
Hologic, Inc.

Web site: http://www.hologic.com/