Bio-Techne 10-Q 2024-09-30

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

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☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024**, or**

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

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Commission file number 0-17272

BIO-TECHNE CORPORATION

(Exact name of registrant as specified in its charter)

Minnesota	41-1427402
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
614 McKinley Place N.E. Minneapolis**,** MN 55413	(612) 379-8854
(Address of principal executive offices) (Zip Code)	(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Exchange Act:

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Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	TECH	The NASDAQ Stock Market LLC

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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 ☒ No ☐

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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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Indicate by check mark whether the Registrant is a shell company (as defined in Exchange Act Rule 12b- 2). ☐ Yes ☒ No

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At October 31, 2024, 158,891,800 shares of the Company's Common Stock (par value $0.01) were outstanding.

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TABLE OF CONTENTS

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		Page
PART I. FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (Unaudited)	1
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	30
Item 4.	Controls and Procedures	30
PART II: OTHER INFORMATION
Item 1.	Legal Proceedings	30
Item 1A.	Risk Factors	30
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3.	Defaults Upon Senior Securities	31
Item 4.	Mine Safety Disclosures	31
Item 5.	Other Information	31
Item 6.	Exhibits	32
​	SIGNATURES	35

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PART I. FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

AND COMPREHENSIVE INCOME

Bio-Techne Corporation and Subsidiaries

(in thousands, except per share data)

(unaudited)

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​	​	​	​	​	​	​	​
​	​	Quarter Ended					​
​	​	September 30,					​
​	​	2024		​	2023		​
​	​	​	​	​	​	​	​
Net sales	​	$	289,458	​	$	276,935	​
Cost of sales	​		106,441	​		91,744	​
Gross margin	​		183,017	​		185,191	​
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Operating expenses:	​	​	​	​			​
Selling, general and administrative	​		119,161	​		105,331	​
Research and development	​		23,869	​		23,998	​
Total operating expenses	​		143,030	​		129,329	​
Operating income	​		39,987	​		55,862	​
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Other income (expense)	​	​	184	​	​	(6,304)	​
Earnings before income taxes	​		40,171	​		49,558	​
Income taxes	​		6,571	​		(1,435)	​
Net earnings	​	$	33,600	​	$	50,993	​
Other comprehensive income (loss):	​			​			​
Foreign currency translation income (loss)	​		21,256	​		(11,602)	​
Unrealized gains (losses) on derivative instruments - cash flow hedges, net of tax amounts disclosed in Note 8	​		(3,027)	​		(350)	​
Other comprehensive income (loss)	​		18,229	​		(11,952)	​
Comprehensive income	​	$	51,829	​	$	39,041	​
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Earnings per share:	​	​	​	​	​	​	​
Basic	​	$	0.21	​	$	0.32	​
Diluted	​	$	0.21	​	$	0.31	​
​	​	​	​	​	​	​	​
Weighted average common shares outstanding:	​			​			​
Basic	​		158,531	​		158,130	​
Diluted	​		161,115	​		161,940	​

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See Notes to Condensed Consolidated Financial Statements.

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CONDENSED CONSOLIDATED BALANCE SHEETS

Bio-Techne Corporation and Subsidiaries

(in thousands, except share and per share data)

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​		September 30,		​	​	​
​	​	2024		​	June 30,
​	​	(unaudited)		​	2024
ASSETS		​			​
Current assets:		​			​
Cash and cash equivalents	​	$	187,540	​	$	151,791
Short-term available-for-sale investments	​		—	​		1,072
Accounts receivable, less allowance for doubtful accounts of $4,904 and $4,386, respectively	​		223,688	​		241,394
Inventories	​		185,041	​		179,731
Current assets held-for-sale	​	​	9,459	​	​	9,773
Other current assets	​		42,839	​		33,658
Total current assets	​

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None.

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Not applicable.

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During the three months ended September 30, 2024, certain of our directors and officers of the Company adopted a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in item 408(a) of Regulation S-K.

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Kim Kelderman, President, Chief Executive Officer, and Director the Company, adopted a Rule 10b5-1 trading plan effective September 5, 2024. Mr. Kelderman’s trading plan provides for the sale of up to 97,700 shares of common stock between December 5, 2024 and August 6, 2025, which is the expiration date of the plan.

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ITEM 6. EXHIBITS

EXHIBIT INDEX

TO

FORM 10-Q

BIO-TECHNE CORPORATION

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Exhibit Number		Description
3.1	​	Amended and Restated Articles of Incorporation of the Company--incorporated by reference to Exhibit 3.1 of the Company's 8-K dated November 1, 2022*
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3.2	​	Fourth Amended and Restated Bylaws of the Company--incorporated by reference to Exhibit 3.1 of the Company’s Form 8-K dated April 27, 2022*
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4.1	​	Description of Capital Stock -- incorporated by reference to Exhibit 4.1 of the Company's Form 10-K dated August 22, 2024*
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10.1**	​	Management Incentive Plan--incorporated by reference to Exhibit 10.13 of the Company's Form 10-K for the year ended June 30, 2013*
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10.2**	​	Second Amended and Restated 2010 Equity Incentive Plan--incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K dated October 26, 2017*
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10.3**	​	Form of Time Vesting Restricted Stock Award Agreement for Second Amended and Restated 2010 Equity Incentive Plan - incorporated by reference to Exhibit 10.3 of the Company's Form 10-K dated August 25, 2021*
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10.4**	​	Form of Performance Vesting Restricted Stock Award Agreement for Second Amended and Restated 2010 Equity Incentive Plan - incorporated by reference to Exhibit 10.4 of the Company's Form 10-K dated August 25, 2021*
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10.5**	​	Form of Time Vesting Restricted Stock Unit Award Agreement for Second Amended and Restated 2010 Equity Incentive Plan - incorporated by reference to Exhibit 10.5 of the Company's Form 10-K dated August 25, 2021*
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10.6**	​	Form of Performance Vesting Restricted Stock Unit Award Agreement for Second Amended and Restated 2010 Equity Incentive Plan - incorporated by reference to Exhibit 10.6 of the Company's Form 10-K dated August 25, 2021*
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10.7**	​	Form of the Time Vesting Performance Unit Award Agreement for Second Amended and Restated 2010 Equity Incentive Plan - incorporated by reference to Exhibit 10.7 of the Company's Form 10-K dated August 25, 2021*
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10.8**	​	Form of Performance Vesting Performance Unit Award Agreement for Second Amended and Restated 2010 Equity Incentive Plan - incorporated by reference to Exhibit 10.8 of the Company's Form 10-K dated August 25, 2021*
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10.9**	​	Form of Time Vesting Incentive Stock Option Agreement for Second Amended and Restated 2010 Equity Incentive Plan - incorporated by reference to Exhibit 10.9 of the Company's Form 10-K dated August 25, 2021*
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Exhibit Number		Description
10.10**	​	Form of Performance Vesting Incentive Stock Option Agreement for Second Amended and Restated 2010 Equity Incentive Plan - incorporated by reference to Exhibit 10.10 of the Company's Form 10-K dated August 25, 2021*
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10.11**	​	Form of Employee Non-Qualified Stock Option Agreement for Second Amended and Restated 2010 Equity Incentive plan- incorporated by reference to Exhibit 10.11 of the Company's Form 10-K dated August 25, 2021*
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10.12**	​	Form of Director Non-Qualified Stock Option Agreement for Second Amendment and Restated 2010 Equity Incentive Plan - incorporated by reference to Exhibit 10.2 of the Company's Form 8-K dated October 26, 2017*
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10.13**	​	Employment Agreement by and between the Company and Charles Kummeth - incorporated by reference to Exhibit 10.11 of the Company's Form 10-K dated September 7, 2017*
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10.14**	​	Form of Employment Agreement by and between the Company and Executive Officers of the Company other than the CEO --incorporated by reference to Exhibit 10.12 of the Company's Form 10-K dated September 7, 2017*
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10.15**	​	Form of Amendment No. 1 to Executive Employment Agreement – incorporated by reference to Exhibit 10.15 of the Company’s Form 10-Q dated May 11, 2020*
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10.16	​	Amended and Restated Credit Agreement by and among the Company, the Guarantors party thereto, the Lenders party thereto, and BMO Harris Bank N.A., as Administrative Agent, dated August 31, 2022--incorporated by reference to Exhibit 10.1 of the Company's Form 8-K dated September 7, 2022*
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10.17**	​	Form of Indemnification Agreement entered into with each director and executive officer of the Company - incorporated by reference to Exhibit 10.1 of the Company's Form 10-Q dated February 8, 2018*
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10.18**	​	Bio-Techne 2020 Equity Incentive Plan – incorporated by reference to Exhibit 10.1 of the Company’s Form 8-k dated November 3, 2020*
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10.20	​	Form of Director Non-Qualified Stock Option Agreement – incorporated by reference to Exhibit 10.2 of the Company’s Form 8-k dated November 3, 2020*
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10.21**	​	Form of Employee Non-Qualified Stock Option Agreement (Global) – incorporated by reference to Exhibit 10.3 of the Company’s Form 8-k dated November 3, 2020*
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10.22**	​	Form of Performance Vesting Cash Unit Agreement– incorporated by reference to Exhibit 10.4 of the Company’s Form 8-k dated November 3, 2020*
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10.23**	​	Form of Performance Vesting Incentive Stock Option Agreement– incorporated by reference to Exhibit 10.5 of the Company’s Form 8-k dated November 3, 2020*
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10.24**	​	Form of Performance Vesting Restricted Stock Agreement– incorporated by reference to Exhibit 10.6 of the Company’s Form 8-k dated November 3, 2020*
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10.25**	​	Form of Performance Vesting Restricted Stock Unit Agreement– incorporated by reference to Exhibit 10.7 of the Company’s Form 8-k dated November 3, 2020*
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10.26**	​	Form of Time Vesting Incentive Stock Option Agreement– incorporated by reference to Exhibit 10.8 of the Company’s Form 8-k dated November 3, 2020*
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10.27**	​	Form of Time Vesting Cash Unit Agreement– incorporated by reference to Exhibit 10.9 of the Company’s Form 8-k dated November 3, 2020*
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Exhibit Number		Description
10.28**	​	Form of Time Vesting Restricted Stock Agreement– incorporated by reference to Exhibit 10.10 of the Company’s Form 8-k dated November 3, 2020*
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10.29**	​	Form of Time Vesting Restricted Stock Unit Agreement (Global) – incorporated by reference to Exhibit 10.11 of the Company’s Form 8-k dated November 3, 2020*
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10.30**	​	Form of Executive Employment Agreement by and between the Company and Kim Kelderman – incorporated by reference to Exhibit 10.1 of the Company’s Form 8-K dated October 19, 2023*
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21	​	Subsidiaries of the Company - incorporated by reference to Exhibit 21 of the Company's Form 10-K dated August 22, 2024*
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31.1	​	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
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31.2	​	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
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32.1	​	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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32.2	​	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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101	​	The following financial statements from the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, formatted in Inline Extensible Business Reporting Language (iXBRL): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Earnings and Comprehensive Income, (iii) the Condensed Consolidated Statements of Cash Flows, and (iv) Notes to the Condensed Consolidated Financial Statements.
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104	​	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

• Incorporated by reference; SEC File No. 000-17272

** Management contract or compensatory plan or arrangement

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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.

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​		BIO-TECHNE CORPORATION
​	​	(Company)
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Date: November 5, 2024	​	/s/ Kim Kelderman
​	​	Kim Kelderman
​	​	President and Chief Executive Officer
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Date: November 5, 2024	​	/s/ James Hippel
​	​	James Hippel
​	​	Executive Vice President, Chief Financial Officer

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