News


Hologic Announces Fourth Quarter and Fiscal 2005 Operating Results
Revenues, Earnings and Backlog Increase to Record Highs
PRNewswire-FirstCall
BEDFORD, Mass.

BEDFORD, Mass., Nov. 2, 2005 /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 and year ended September 24, 2005.

  Highlights of the quarter include:

  * Record revenues of $78.2 million.

  * Record earnings of $9.5 million.

  * Record backlog of $102 million.

  * Record 71 Selenia full field digital mammography systems installed and
    recognized as revenue.

  * Increased cash flow of $11.7 million.

Fourth quarter fiscal 2005 revenues totaled $78,217,000, a 22% increase when compared to revenues of $63,949,000 in the fourth quarter of fiscal 2004. For the fourth quarter of fiscal 2005, Hologic reported net income of $9,476,000, or $0.41 per diluted share, compared with net income of $5,210,000, or $0.24 per diluted share, in the fourth quarter of fiscal 2004. 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 fourth quarter of fiscal 2004.

In the current quarter, Hologic's effective tax rate increased to 22% of pre-tax earnings. This rate is higher than the 17% effective tax rate for the first nine months of fiscal 2005 and is higher than previously expected due to the Company's continued better-than-expected performance and the resulting increase in the Company's earnings for the current fiscal year. The Company's tax rate for the full 2005 fiscal year is approximately 19%. For fiscal 2006, the Company expects the effective tax rate to increase to a more normalized rate of approximately 37%.

For the year ended September 24, 2005, revenues totaled $287,684,000, compared to revenues of $228,705,000 for the year ended September 25, 2004. For the year ended September 24, 2005, Hologic reported net income of $28,256,000, or $1.25 per diluted share, compared with net income of $12,164,000 or $0.57 per diluted share, for fiscal 2004.

During the fourth quarter, Hologic recognized as revenue 71 Selenia full field digital mammography systems. At September 24, 2005, the Company's backlog for orders of Selenia was 185 systems and total backlog for all products increased to $102 million, the highest quarterly backlog in the Company's history and a 10% increase over the backlog at June 25, 2005.

"We are very pleased to report record revenues for the fourth quarter of fiscal 2005, in addition to full year revenue growth of 26% over fiscal 2004," said Jack Cumming, Chairman and CEO. "Our sales growth reflects the continued demand for Selenia, our leading-edge digital mammography system. Along with increasing sales, our success in controlling costs and improving internal efficiencies resulted in solid gains in profitability. We believe we are well positioned for fiscal 2006, as we expect to continue to grow our revenue pipeline by focusing on expanding our product offerings as well as our relationships with existing customers and winning new business in our core markets."

  Fourth quarter financial overview by segment:

  * Mammography revenues increased 47% to $49,336,000 for the fourth quarter
    of fiscal 2005 from $33,620,000 for the same period in fiscal 2004.
    This increase was primarily due to continued increasing sales of Selenia
    in the domestic market and, to a lesser extent, an increase in sales of
    the MultiCare breast biopsy tables.  Operating income for this business
    segment in the fourth quarter of fiscal 2005 increased to $9,856,000
    compared to operating income of $4,168,000 in the fourth quarter of
    fiscal 2004.  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.

  * Osteoporosis assessment revenues increased 11% to $19,640,000 for the
    fourth quarter of fiscal 2005 from  $17,763,000 for the same period in
    fiscal 2004.  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 fourth
    quarter of fiscal 2005 increased to $3,628,000 compared to operating
    income of $2,063,000 in the fourth quarter of fiscal 2004.  This
    increase in operating income in the current quarter was primarily due to
    the increase in revenues.

  * Digital detector revenues decreased 26% to $4,209,000 for the fourth
    quarter of fiscal 2005 from $5,663,000 for the same period in fiscal
    2004.  This decrease was primarily due to a decrease in the number of
    general radiography digital detectors sold to other OEMs.  Operating
    loss for this business segment in the fourth quarter of fiscal 2005
    increased to $2,876,000 from $867,000 in the fourth quarter of fiscal
    2004.  This increase in operating loss in the current quarter was
    primarily due to the decrease in revenues and higher service related
    expenses.

  * All other revenues which includes the Company's mini C-arm, conventional
    general radiography service and digital general radiography systems
    businesses decreased 27% to $5,033,000 for the fourth quarter of fiscal
    2005 from $6,903,000 for the same period in fiscal 2004.  The decrease
    in revenues was primarily due to the shipment of fewer digital general
    radiography systems as this business is currently being phased out and,
    to a lesser extent, a decrease in sales of mini C-arm systems.
    Operating income for this business segment in the fourth quarter of
    fiscal 2005 increased to $801,000 from a loss of $112,000 in the fourth
    quarter of fiscal 2004.  This increase in operating income in the
    current quarter was primarily due to the elimination of unprofitable
    digital general radiography sales and the elimination of the operating
    expenses allocated to this business.

On September 29, 2005, Hologic completed the acquisition of Fischer Imaging Corporation's intellectual property relating to its mammography business and products, including the rights to their SenoScan digital mammography and MammoTest stereotactic breast biopsy systems. As previously reported Hologic expects to incur an up-front charge of approximately $4 million to write off in-process research and development in the first quarter of fiscal 2006, which ends on December 24, 2005. In addition, we expect to incur an annual charge of approximately $2.5 million beginning in fiscal 2006 to amortize certain intangible assets acquired in the transaction.

In the first quarter of fiscal 2006, the Company will begin to account for employee stock options under FASB123R's fair value method. For fiscal 2006, the Company anticipates that the stock-based compensation cost will be approximately $4 million as a result of the adoption of FASB123R.

On September 23, 2005, the Company announced that its Board of Directors had approved a two-for-one stock split, subject to stockholder approval of a proposed amendment to increase the number of shares of Common Stock the Company has authority to issue. A Special Meeting of Stockholders is scheduled for November 15, 2005. If the amendment is approved, the record date for the stock split will be November 16, 2005 and the payment date will be November 30, 2005. The Company's financial statements to be included in its Annual Report on Form 10-K to be filed in December 2005 are expected to retroactively reflect the stock split.

Hologic's management will host a conference call today at 10:00 a.m. (Eastern) to discuss fourth quarter and fiscal 2005 operating results. Interested participants may listen to the call by dialing 800-406-5356 or 913- 981-5572 for international callers and referencing code 8944515 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 November 4, 2005 at 888-203-1112 or 719-457-0820 for international callers, access code 8944515. 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, direct-to- digital X-ray for general radiography applications and mini C-arm imaging for orthopedic applications. For more information, please 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 anticipated compensation cost for employee stock options during fiscal 2006, the expected charges associated with the acquisition of the mammography intellectual property assets of Fischer Imaging Corporation, the Company's expectation for growth during fiscal 2006, the Company's two- for-one stock split, 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; the risk that the Company's stockholders do not approve the proposal to increase the number of authorized shares of Common Stock of the Company, in which case the stock split will not occur; risks relating to acquisitions; expenses and uncertainties relating to litigation; risks relating to compliance with financial covenants under the Company's working capital financing and 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.

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

                                  ASSETS


                                               September 24,  September 25,
                                                     2005           2004
  CURRENT ASSETS:
   Cash and cash equivalents                      $113,994        $68,335
   Accounts receivable, net                         57,742         48,409
   Inventories                                      44,520         40,174
   Prepaid expenses and other current assets        12,119          9,135
     Total current assets                          228,375        166,053

  Property and equipment, net                       33,329         32,877
  Intangible assets, net                             5,162          6,251
  Goodwill, net                                      6,285          6,285
  Other assets, net                                  6,688            285
                                                  $279,839       $211,751


                   LIABILITIES AND STOCKHOLDERS' EQUITY


                                               September 24,  September 25,
                                                     2005           2004
  CURRENT LIABILITIES:
   Current portion of note payable                      $-           $475
   Accounts payable                                 14,163         10,546
   Accrued expenses                                 25,237         20,970
   Deferred revenue                                 21,134         13,013
     Total current liabilities                      60,534         45,004

   Notes payable, net of current portion                 -            472
   Deferred income tax liabilities                   1,471              -

  STOCKHOLDERS' EQUITY:
   Common stock, $.01 par value-
   Authorized - 30,000 shares
    Issued - 22,148 and 20,585
     shares, respectively                              221            206
   Capital in excess of par value                  172,865        149,452
   Retained earnings                                46,452         18,196
   Cumulative translation adjustment               (1,240)        (1,115)
   Treasury stock, 45 shares at cost                 (464)          (464)
     Total stockholders' equity                    217,834        166,275
                                                  $279,839       $211,751



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


                               Three Months Ended       Twelve Months Ended
                             Sept. 24,   Sept. 25,    Sept. 24,    Sept. 25,
                                 2005        2004         2005         2004

  REVENUES                     $78,217     $63,949     $287,684     $228,705

  COSTS AND EXPENSES:
   Cost of revenues             46,264      40,780      174,659      143,336
   Research and development      4,324       4,362       18,617       16,659
   Selling and marketing         8,905       7,325       34,199       31,761
   General and administrative    7,315       6,229       27,578       24,363

                                66,808      58,695      255,053      216,119

        Income from operations  11,409       5,253       32,631       12,586

  Interest income                  857         191        2,219          540

  Interest expense/other
   income (expense)              (151)         212        (155)        (199)

        Income before provision
         for income taxes       12,115       5,656       34,695       12,927

  Provision for Income Taxes     2,639         446        6,439          763

  Net income                    $9,476      $5,210      $28,256      $12,164

  Net income per common and
   common equivalent share:
        Basic                    $0.43       $0.25        $1.32        $0.60
        Diluted                  $0.41       $0.24        $1.25        $0.57

  Weighted average number of
   common shares outstanding:
        Basic                   22,034      20,482       21,412       20,258
        Diluted                 23,162      21,525       22,563       21,296


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

SOURCE: Hologic, Inc.

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

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