Greenlane Q4 2021 Earnings Call Transcript

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Provided by Quartr
February 10, 2022

There are 9 speakers on the call.

Operator

Good evening. Thank you for attending today's Bio Rad Laboratories Q4 and Full Year Financial Results Conference Call. My name is Hannah, and I will be your moderator for today's call. All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. I would now like to pass the conference over to our host, Edward Chung, Head of Investor Relations with Bio Rad.

Operator

Please go ahead.

Speaker 1

Thanks, Hannah. Good afternoon and thank you all for joining us. Today, we will review the Q4 and full year 2021 financial and provide an update on key business trends for Bio Rad. With me on the phone today are Norman Schwartz, our Chief Executive Sir, Ilan Daskov, Executive Vice President and Chief Financial Officer Andy Laps, Executive Vice President and Chief Operating Officer Simon May, President of the Life Science Group and Dara Wright, President of the Clinical Diagnostics Group. Before we begin our review, I would like to caution everyone that we will be making forward looking statements about management's goals, plans and expectations, our future financial performance and other matters.

Speaker 1

These statements are based on assumptions and expectations of future events that are subject to risks and uncertainties. Included in these forward looking statements are commentary regarding the impact of the COVID-nineteen pandemic on Bio Rad's results and operations and steps Bio Rad is taking in response to the pandemic. Our actual results may differ materially from these plans and expectations and the impact and duration of the COVID-nineteen pandemic is unknown. You should not place undue reliance on these forward Looking statements and I encourage you to review our filings with the SEC where we discuss in detail the risk factors in our business. The company does not intend to update any forward looking statements made during the call today.

Speaker 1

Finally, our remarks today will include references to non GAAP Net income and diluted earnings per share, which are financial measures that are not defined under generally accepted accounting principles. Investors should review the reconciliation of these non GAAP measures to the comparable GAAP results contained in our earnings release. With that, I will now turn the call over to Alain Baskol, our Executive Vice President and Chief Financial Officer.

Speaker 2

Thank you, Ed. Good Good afternoon. Thank you all for joining us, and we hope that you and your families are well and staying healthy during these challenging times. Before I begin the detailed 4th quarter and full year discussion, I would like to ask Andy Vlas, our Chief Operating Officer, to provide an update on Vallourec's operations in light of the current pandemic related environment that we are experiencing globally. Andy?

Speaker 3

Great. Many thanks, Helane. So as an opening comment, I would like to once again recognize the tremendous contributions, Resilience and responsiveness of all of our employees around the world as we closed out the 2nd challenging year of the pandemic. As we entered 2021, we continued to maintain our focus on the 3 key areas we previously highlighted: Our customers are making sure we continue to advance our core strategies. During Q4, we continued to experience Solid recovery in most of our key global markets as well as an uptick in demand for COVID related products driven by the explosive spread of As indicated in Q3, we also experienced a growing increase in supply challenges driven by the inconsistency of supply for key components, particularly electronic components and plastics.

Speaker 3

We also saw some logistics challenges at year end. The organization responded well to this situation, Although it did result in an inability to fulfill all our orders in Q4. In addition, for the first time, we saw a greater impact to omicron on our workforce, although we believe our mandatory vaccination program in the United States helps us to avoid worst of Overall, despite these challenges, we finished the year strongly and are very encouraged by the progress and growth we delivered in 2021. And as we enter 2022, we continue to spend considerable effort on sourcing components and balancing our efforts to meet growing customer demand and expect that this situation will persist through Q1 and well into Q2. As a result of the COVID-nineteen Omicron variant, we also extended our work from home policy until March 15, at which point we will reassess While we experienced an uptick in demand for our COVID products in Q4 as Omicron Fred, we still expect COVID related demand for our products to be sequentially lower in 2022.

Speaker 3

We see that the majority of our end markets are well served and testing capacity with testing capacity. Broadly, our end markets have now adapted well to operating in the pandemic environment And core product demand has generally recovered to close to normal levels. So thank you for your attention, and I'll pass it back to Alain.

Speaker 2

Thank you, Andy. Now I would like to review the results of the Q4 and full year. Net sales for the Q4 of 2021 were $732,800,000 which is a 7.2% decrease on a reported basis versus $789,800,000 in Q4 of 2020. On a currency neutral basis, sales decreased 6.9 percent. The decline in revenue was a result of $32,000,000 related to Excluding the $32,000,000 damages awarded in 2020, the 4th quarter year over year currency neutral revenue decline was 2.9%, And again, mainly related to lower COVID sales.

Speaker 2

We estimate that COVID related sales were about $46,000,000 in the quarter, which was roughly double our forecast and reflected continued spikes in demand from geographies where new outbreaks have occurred. Despite the supply chain challenges, the 4th quarter currency neutral core year over year revenue, which excludes COVID related sales, increased 10.2%. In addition, supply chain constraints did impact the 4th quarter revenue by approximately $30,000,000 of which we expect to recover about $20,000,000 in 2022. On a geographic basis, we experienced currency neutral Year over year core revenue growth across all three regions, while COVID related year over year sales declined globally. As a reminder, our core revenue is defined as currency neutral, non GAAP and excludes COVID results.

Speaker 2

Sales of the Life Science Group in the Q4 of 2021 was $326,600,000 compared to $428,500,000 in Q4 of 20 on a currency neutral basis. Excluding COVID related sales and the $32,000,000 settlement for debt royalties, The underlying Life Science business year over year currency neutral core revenue growth was 7.9%. The year over year growth was driven by Droplet Digital PCR as well as our qPCR business, which is experiencing nice uptake from our new generation, CFX Opus platform. On a geographic basis, Life Science experienced currency neutral year over year core revenue growth across all three regions, while COVID related year over year sales declined globally. Sales of the Clinical Diagnostics In the Q4 were $404,900,000 compared to $359,600,000 in Q4 of 20 Excluding COVID related sales, the Clinical Diagnostic business year over year CoronacciNeutral core revenue growth was 12.1%.

Speaker 2

During the Q4, the Diagnostics Group posted growth across all of its product lines. The year over year growth was driven by a recovery of routine testing, which is now generally approaching pre COVID levels. On a geographic basis, the Diagnostics Group, currency neutral Year over year sales grew mid single digit in the Americas and saw double digit growth in the Europe and Asia regions. The reported gross margin for the Q4 of 2021 was 54.7% on a GAAP basis and compares to 58.3% in Q4 of 2020. The 4th quarter gross margin year over year decline was mainly due to the $32,000,000 settlement payment in 2020 and to a lesser extent Product mix, increased freight cost and lower manufacturing utilization related to our overall supply chain challenges.

Speaker 2

Amortization related to prior acquisitions recorded in cost of goods sold was $4,700,000 as compared to $4,600,000 in for of 2020. SG and A expenses for Q4 of 2021 were 224 point expenses and increased marketing activities. Total amortization expense related to acquisition recorded in SG and A for The quarter was $1,800,000 versus $2,400,000 in Q4 of 2020. Research and development expense in Q4 was $69,900,000 or 9.5 Q4 operating income was $107,000,000 or 14.6 percent of sales compared to 1 $175,200,000 or 22.2 percent of sales in Q4 of 2020. The lower year over year operating income was driven by the significantly lower contribution from COVID related sales.

Speaker 2

The reduced COVID sales negatively impacted mix and along with supply chain constraints contributed to lower manufacturing utilization. In addition, Q4 of 2020 benefited from the $32,000,000 intellectual property settlement. Looking below the operating line, the change in fair market value of Equity Securities Holdings, which are substantially related to BioRay's ownership of Sartorius AG shares, negatively impacted the reported results by 2,000,000,000 and $153,000,000 Also during the quarter, interest and other income resulted in a net benefit of $7,500,000 primarily driven by the investment income and compared to $1,000,000 of expense last year. The effective tax rate for the Q4 of 2021 was 22.8% compared to 22.2% for the same period in 2020. The effective tax rates were primarily affected by the change in value of the security holdings.

Speaker 2

Reported net loss for the 4th quarter was $1,574,000,000 and diluted loss per share were $52.59 This is a decrease from last year and is largely related to changes Moving on to the non GAAP results. Looking at the results on a non GAAP basis, we have excluded certain applicable and unique items that impacted both the gross and operating margins as well as other income. These items are detailed in the reconciliation table in the press release. Looking at the non GAAP results for the Q4, in cost of goods sold, we have excluded $4,700,000 of amortization of purchased intangibles, a small restructuring and nonrecurring items. These exclusions move the gross margin for the Q4 of 2021 to a non GAAP gross margin of 55.4% versus 58 2% in Q4 of 2020.

Speaker 2

Non GAAP SG and A in the Q4 of 2021 was 30.2% versus 28.2% in Q4 of 2020. In SG and A, On a non GAAP basis, we have excluded amortization of purchase intangibles of $1,800,000 An in vitro diagnostic registration fee in Europe for previously approved products of $1,600,000 legal related expenses of 9 In the Q4 of 2021 was 9.8% versus 8.7% in Q4 of 2020. In R and D, on a non GAAP basis, we have excluded a $2,000,000 restructuring benefit. A cumulative sum of these non GAAP adjustments result in moving the quarterly operating margin from 14.6% on a GAAP basis to 15.4% on a non GAAP basis. This non GAAP operating margin compares to a non GAAP operating margin of 21.4% in Q4 of 2020.

Speaker 2

We have also excluded certain items below the operating line, which are the decrease in value of the Sartorius equity holdings of $2,153,000,000 and about a $1,600,000 loss associated with venture investments. The non GAAP effective tax rate for the Q4 of 2021 was 20.3% compared to 24.3% for the same period in 2020. The lower rate in 2020 1 was driven by the geographic mix of earnings. And finally, non GAAP net income for the Q4 of 2021 was $97,000,000 or $3.21 diluted earnings per share compared to $121,000,000 and $4.01 per share in Q4 of 2020. Moving on to the full year results.

Speaker 2

Net sales for the full year of 2021 were $2,923,000,000 on a reported basis. Excluding the settlement for back royalties of $32,000,000 2021 sales reached 2 COVID related sales for the full year were about $266,000,000 compared to 3.18 Which we define as currency neutral non GAAP and excludes COVID related sales was 17%. Sales of the Life Science Group for 2021 were $1,401,000,000 Excluding the settlement for bad royalties of $32,000,000 the year over year growth was 12.3% on a currency neutral basis. When excluding COVID related sales, Life Science year over year currency neutral growth was 23.6%. The majority of the year over year growth was driven by our core PCR products, Droplet Digital PCR, Process Media and Western Bloc.

Speaker 2

On a geographic basis, Life Science currency neutral full year over year sales grew across all three regions. Sales of Clinical Diagnostics products for 2021 were $1,516,000,000 which is growth of 13.6% on a currency neutral basis. When excluding COVID related sales, clinical diagnostics year over On a geographic basis, Clinical Diagnostics full year over year sales grew across all regions. The full year non GAAP gross margin was 57.3% compared to 56.9% in 2020. The year over year margin increase was driven mainly by improved manufacturing efficiencies as a result of our various initiatives.

Speaker 2

Full year non GAAP SG and A as a percentage of sales was 28.6% compared to 30.9% in 2020 and benefited from higher revenue despite increased employee related cost and discretionary expenses. Full year non GAAP R and D was $268,600,000 or 8.9 percent of sales versus $227,900,000 or 9.1 percent in 20 And full year non GAAP operating income was 19.8% compared to 17% in 2020, representing significant year over year improvement in performance. Lastly, the non GAAP Effective tax rate for the full year of 2021 was 21.2%, which was consistent with our guidance range. The 21.2 percent non GAAP effective tax rate for 2021 was lower than the 24% non GAAP rate for 2020 as a result of an increase in compensation related tax deductions. Moving on to the balance sheet.

Speaker 2

Total cash and short term investments at the end of 2021 was $875,000,000 compared to $997,000,000 at the end of 2020 $1,343,000,000 at the end of the Q3 of 2021. The change in cash and short term investments from the Q3 was primarily due to the loan to the Sartorius Herbst Special Purpose entity and the payment for the Dropbox acquisition, which was partially offset by cash flow generated from operations. During the Q4, we did not purchase any shares And we had a total of $223,000,000 available for potential share buybacks. Full year share buybacks was about 90,000 shares for $50,000,000 In 2020, we purchased about 292,000 shares of our stock for $100,000,000 For the Q4 of 2021, Net cash generated from operating activities was $157,900,000 which compares to $284,700,000 in Q4 of 2020. This decrease mainly reflects Change in working capital and lower operating profits.

Speaker 2

For the full year of 2021, Net cash generated from operations was $656,500,000 versus $575,300,000 in 2020. This increase mainly reflects higher full year operating profits. Adjusted EBITDA for the Q4 of 2021 was 19.1 percent of sales. The adjusted EBITDA in Q4 of 2020 was 25.2%. Full year adjusted EBITDA, including the Sartorius Cividend was $696,400,000 or about 24.1% compared to 21.7 percent in 2020.

Speaker 2

Net capital expenditures for the Q4 of 2021 were $43,200,000 and full year CapEx spend was $120,800,000 Depreciation and amortization for the 4th quarter was $33,700,000 133 $8,000,000 for the full year. Moving on to the non GAAP guidance for 2022. Overall, we are pleased with the performance in 2021 as The global economy is adapting to operating with COVID. Going into 2022, we expect to continue the positive momentum that we However, we expect to see the ongoing supply chain constraints that we experienced in Q4 persist through the first half of twenty twenty two. As a result, we anticipate a lower year over year growth in the first half of twenty twenty two with higher growth in the back half of the year.

Speaker 2

As mentioned earlier, we expect to recover in 2022 about $20,000,000 of revenue carryover from 2021 related to supply chain constraints. We are guiding the currency neutral revenue growth in 2022 to be between 1% 2%, which includes about $70,000,000 of COVID related sales that are significantly subsiding from the prior 2 years. Excluding COVID related sales, we estimate currency neutral revenue growth in 2022 to be between 8.5% and 9.5%. We estimate about 2% 3% currency neutral revenue growth for the Diagnostics Group. The Diagnostics Group year over year revenue growth, excluding COVID, is expected to be between 3% 4%.

Speaker 2

The Life Science Group year over year currency neutral revenue growth is expected to be between flat 1.5% as we project the COVID related sales in 2022 to We will experience quarterly revenue fluctuations for Process Media, although we estimate an overall double digit growth for the full year. Full year non GAAP gross margin is projected to be about 57.5%. We plan to offset inflationary cost pressure with targeted price realization, particularly within the Life Science Group. Full year non GAAP operating margin is projected to be approximately 19%. We estimate the non GAAP full year tax rate to be between 22% 23%.

Speaker 2

CapEx is projected to be approximately $140,000,000 and full year adjusted EBITDA margin to be between 23.5% and 23.8%. Lastly, I'd like to remind everyone that we will be holding an In Person Investor Day on February 25 at the New York Stock Exchange. That concludes our prepared remarks, and we will now open the line to take your

Operator

The first question is from the line of Brandon Couillard with Jefferies. You may proceed.

Speaker 4

Hey, thanks. Good afternoon, guys. Alon, maybe just starting with the outlook on the top line, I mean, 9% growth in the base business, including 16% to 18% Sciences is pretty punchy and well above kind of what we're, I think, accustomed to seeing out of Bio Rad in a normal year. Can you just sort of elaborate On kind of the drivers of that stream, particularly in life sciences and your level of visibility to hitting Those targets and to what degree if at all you kind of embedded some conservatism perhaps from ongoing component shortages, things like that?

Speaker 3

So Brandon, hi, actually, this is Andy. Yes, I think the guidance reflects basically the execution of the core strategies that we've been pursuing for the Life Science business and the growth drivers In biopharma, the ongoing growth in our digital PCR business, So it's certainly, it's an improvement in growth rate. As to the component supply, so we're seeing a challenge certainly in the Q1 We see that extending a bit into the Q2. But we do see line of sight to the end of those supply constraints. And all being Well, we'll see a good acceleration in the second half.

Speaker 3

So I would say The performance is driven by the execution of our core strategies, which are playing out nicely in our various end markets.

Speaker 2

Yes. Brendan, I will highlight what I mentioned earlier that the first half we anticipate that the year over year growth is going to be lower than the back half of the year. I mean that's

Speaker 4

Okay. Maybe just on that Alon, maybe kind of Collyn, you can kind of share with us some sort of how we should think about top line growth in the first half versus second half? I mean, first half maybe low singles and then in the back half north of the Is it any top into the range for the full year? Any

Speaker 2

kind of Yes, that's a fair assessment, Brent, on low single in the first half And then accelerating in the second half. Overall, in the midpoint for the full year, it's about 9%.

Speaker 4

Okay. Got you. And then in terms of the margin outlook, I mean the 19% operating margin for the year is quite a bit better That we expected. Are you able to quantify the impact of the lower COVID revenues compared to what you're Thanks for base business margin expansion. Secondly, are you do you expect to capture any benefit from the European restructuring in the second half

Speaker 2

So yes, it's a great question, Brandon. We did not break down specifically The COVID related kind of impact on the bottom line. However, the guidance The benefits in the back half of this year, so that's definitely a contributor. The mix this year and We returned to the office and increased employee related costs. So that's the overall dynamic, but I think I captured Most of the kind of levers that led us to the guidance.

Speaker 4

Great. And Basu, can you give us a sense kind of what you're embedding for net pricing for the year? Thanks.

Speaker 3

Can you say the question again please, Brandon? Pricing?

Speaker 4

Oh, pricing? Yes, just around Yes, net pricing for the full year.

Speaker 2

I think you said net pricing.

Speaker 3

Yes, we're certainly looking To take pricing through where we can, but it's largely as an offset to Cost inflation, raw material inflation that we're experiencing. So I think pretty much consistent with the rest of the industry right now, which On the Life Science side, we do see opportunity to essentially offset the cost drivers that are coming at us with some price improvement.

Speaker 4

Got you. I'll hop back in

Speaker 3

the queue. Thanks.

Speaker 1

Thank you.

Operator

Thank you, Mr. Couillard. The next question is from the line of Patrick Donnelly with Citi. You may proceed.

Speaker 4

Hey, guys. Thanks for taking the questions. Maybe 1 on the supply chain, it might be for you, Andy. Can you just talk about where the pressure points are? I mean, I know last quarter you kind of talked about it being a little bit of everywhere and A new issue every week that you guys were able to handle.

Speaker 4

Is it still a little bit of that? And then again, encouraging to hear the line of sight that you guys feel this will alleviate Around the middle of the year. I guess just talk about that conference level. And do you expect things to continue to get pushed out? It was nice to see only a little bit of sale lost Captured in 1Q, should we expect that trend to continue?

Speaker 3

Yes. So the supply constraints to the first part of your question, There is a little bit of randomness to it. We have a very large portfolio, as you know, and they're mostly electronic components of different forms. It can be as simple as It can be as simple as a power supply, but a lot of it is chip related, which is a broad global Problem right now. And it's just very inconsistent and you believe you're going to get a certain component and then it doesn't arrive and You know you have to scramble.

Speaker 3

So, it's quite challenging. The organization is doing extremely well to cope with it. As we look into Q1 and through Q1 to Q2, we do feel we're kind of in the thick of it and that We see Q2 will be kind of supply catching up with demand. And that's our current line of sight. We're generally getting signed for the components.

Speaker 3

Supply will come Back more completely in Q2, so that's why we're guiding second half and it is a major acceleration. The big challenge, of course, is to retain the orders through that period. And in some parts of the portfolio, we can Definitely do that. In other areas, it's much harder, and we've considered that in our guidance.

Speaker 4

That's helpful. And then maybe to circle back on the top line, again, that life science growth really strong and Good to see. Can you talk about where we are in digital PCR? Obviously, I'm sure we'll hear more about it in a couple of weeks. But Just in terms of the growth outlook, clearly, big driver this year, feels like we're still early innings, but we'd love your perspective on what applications we're seeing kind of take off here.

Speaker 4

And then again, growth outlook, the sustainability of this type of growth as this is a big driver.

Speaker 3

Yes. Look, we remain very, very confident about the growth potential of digital drop the digital PCR. Had another good year. Another good year is anticipated in our guidance, strong double digit. And I would say our strategy and General end market adoption as they better and better understand the value proposition of high Easy to use digital PCR.

Speaker 3

So there's nothing to suggest a slowdown in our view right now.

Speaker 2

And Patrick, I will add that obviously later this month in the Investor Day, we plan to

Speaker 3

discuss it. Yes, we'll elaborate more and talk maybe a bit more The product portfolio that we're working on for the future.

Speaker 4

Yes, look forward to that. Elam, maybe one for you on the cap deployment side. You mentioned you did buyback any stock in 4Q. Given the market pullback In January, should we expect you guys are typically pretty opportunistic? Were you active on that front to start the year?

Speaker 4

And then secondarily, just your appetite. I know you guys talked a little bit about you have appetite for bolt ons. Norm, if you have any perspective as well, that would be great.

Speaker 2

Yes. So Patrick, obviously, we were and still are in a quiet period, so we were not But we'll definitely continue to be opportunistic. We have about SEK223 1,000,000 in our plan, and We'll find the right timing to step in as similar to the past. If we won't hesitate to be aggressive in case we find

Speaker 3

Yes.

Speaker 5

And certainly in the Q4, you may remember we did manage To complete the acquisition of Dropbox, we bought ourselves kind of a platform in development for So what I would call the entry level in Dropout Digital PCR really adds to our portfolio. Continue to have a number of opportunities in the queue and we're working through them.

Speaker 4

Great. Thanks, Noah.

Operator

Thank you, Mr. Donnelly. Next question is from the line of Ben Leonard with Wells Fargo. You may proceed.

Speaker 6

Thank you for taking the question. So I want to circle back to a question Brandon asked earlier on the margin side. Your EBITDA margin guidance 2022 puts you well in the range of what was your prior 2023 target without meaningful COVID revenue to contribute. So what's trending better than your initial plan? What would you point to?

Speaker 2

In terms of the it's The tariffs initiatives, I mean, the restructuring that we communicated early Last year, there were additional initiatives that are ongoing in our kind of operations in other areas. So it's probably throughout kind of the different line items of the P and L that gets us there.

Speaker 6

You mentioned a couple of times biopharma. The last time you offered At your Analyst Day 5 years ago, proportion of revenue in life science coming from biopharma was pretty low. I think 2 thirds So that life science segment was academic actually. Has that mix meaningfully changed? Can you update us on what the proportion between academic and biopharma Like in

Speaker 2

that business today? So Dan, we do plan to provide an update on that in the Investor Day. I mean, we're

Speaker 3

Well, I think we're fine tuning that Set of numbers, so I'd like to communicate some numbers now that we end up changing as we make sure that Fully, you know, I'm an accurate set. Stay tuned for Stay tuned, yes.

Speaker 2

Definitely something that we plan to discuss during the

Speaker 6

I look forward. And then final question, what's your outlook for demand in China in 2022?

Speaker 3

I think our outlook in China is consistent with recent history. We're Largely underpenetrated in China. So for us, we see China, in In particular, in the whole Asia Pac region as an outside opportunity as we penetrate those markets, In particular, biopharma. And we're investing in the region. So we're investing in our channel.

Speaker 3

So for us,

Operator

Thank you, Mr. Leonard. The next question is from the line of Jack Zeehan with Nephron Research. You may proceed.

Speaker 7

Thank you and good afternoon. I wanted to go back just to clarify on the supply chain impact. Just is it possible to give a little bit more granularity on which products were impacted or breakout that $30,000,000 impact By division and when do you expect the $20,000,000 to hit? Do you expect that to come back more later in 2022?

Speaker 3

So, it was predominantly on the life science side, I'd say very largely on the life science side Of the business, small impacts on the clinical side. And we don't see it coming back in one bolus. It's going to be spread towards the latter part of Q2 and into the

Speaker 7

Okay. And then another question on digital TCR. So I

Speaker 2

was hoping you could just give

Speaker 7

a mark to market. What is the mix of this business now between And capital, if you look at

Speaker 4

the sales in 2021.

Speaker 7

And on the capital side, was curious just with the introduction of QX1 a couple of years ago and then some of the innovation you're working on now, just the expectations for how has the capital piece been growing?

Speaker 8

This is Simon. Obviously, over time, we're seeing a healthy migration where that mix is concerned. I'd say at the present time, it's around It's around fifty-fifty, and we'd expect to see that continue to evolve in a positive direction.

Speaker 7

And the capital piece, how have the new launches been going?

Speaker 8

Yes. QX1 has been very well accepted in the market. We've been happy with the uptake there.

Speaker 3

Okay, great.

Speaker 7

And then had one on Sartorius. So just looking at the balance sheet, so the stake came down to $14,400,000,000 in the quarter. So just

Speaker 3

was hoping you could help me

Speaker 7

with the math because Sartorius' share price actually was up almost 10% in the Q4. I know it's come in the start of the year, but just help just better understand why the value actually came down sequentially?

Speaker 2

Sure. So Jack, we hold 2 different shares. You have the ordinary shares of Sartorius and the preference shares. They're also traded separately And they carry different values every day. And so we have 2 different stakes and probably That's that you see.

Speaker 7

Okay. And last question. I think earlier today, Sartorius talked about a Higher dividend rate to start the year, just hoping you could quantify what that means For Bio Rad and what I should be penciling in here in the Q1?

Speaker 2

So We generally don't guide by quarter, but our current assumption is about because we didn't know about the dividend that So our assumption was a flat dividend from last year. So we will have to maintain if there is any difference

Operator

Thank you, Mr. Meehan. There are no additional questions waiting in queue at this time. So I will pass the call back to Ed Chung for any closing remarks.

Speaker 1

Thank you for joining today's call. We appreciate your interest and we look forward to connecting soon.

Operator

Goodbye. That concludes today's Bio Rad Laboratories Q4 and full year financial results conference call. Thank

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