Harvard Bioscience, Inc. Issues Letter to Shareholders
Provides Update on Performance Against Previously Announced Strategic Plan
HOLLISTON, Mass., May 26, 2020 (GLOBE NEWSWIRE) -- Jim Green, Chairman, President & Chief Executive Officer of Harvard Bioscience, Inc. (Nasdaq: HBIO) (the “Company” or “Harvard Bioscience”),
today issued a letter to shareholders updating them on the Company’s execution against the key strategic actions committed to in September 2019 to position Harvard Bioscience for long-term
The full text of the letter follows:
Dear Harvard Bioscience Shareholders,
I am writing to provide you with updates on our performance against our strategic plan and how are we meeting our commitment to turn around Harvard Bioscience while navigating through the challenges of the COVID-19 pandemic.
Let me start by saying that we are proud to see our products playing a valuable part in the fight against COVID-19. We have seen a significant shift in demand toward research products needed for this effort, including strong demand in our inhalation, respiratory and telemetry product portfolios. Many of our products, such as our BTX Electroporation gene splicing products, are aiding in the development of new treatments, and our multi-well plates are used for antibody detection. Our preclinical products also play a major role in new treatments or vaccines before they can be used in humans. And our recently launched inhalation products arrived just in time to be used for research and development efforts that will help in the fight against COVID-19 and other airborne viruses.
Most importantly, we will continue to be committed to doing all we can to support our customers, including contract research organizations (CROs), and researchers in government, academic and pharmaceutical laboratories in their efforts to research and develop safe and effective treatments and vaccines for COVID-19.
PERFORMANCE AGAINST KEY STRATEGIC COMMITMENTS
The COVID-19 pandemic has had a significant impact on our academic research customers. While this will cause some delays, we still expect to meet or exceed our strategic actions announced on September 9, 2019. Below I report on each of the strategic actions we have committed to:
- We have stabilized the business and completed assembling an experienced leadership team. We have the right executives and Board of Directors to turn the Company around this year.
- We have reduced our interest expense by paying down our debt by $6 million since July 2019. While bank refinancing is delayed, we expect to have the leverage ratio below 3x this year, as we previously stated. Once banks are ready to refinance, we are ready to do so.
- We have improved margins through consolidations, and have reduced cost of goods sold (COGS) and operating expenses. We completed consolidation of our North Carolina operation and have begun consolidating our Connecticut manufacturing operation, which we expect to finish in the next quarter. In addition, we expect to complete the streamlining of our UK operation next quarter. These consolidations have resulted – and will continue to result – in reductions in both COGS and operating expenses.
- Operating expenses and COGS were further reduced by restructuring actions initiated in late 2019 followed by reductions in force, and these expense reductions were further augmented by the COVID-19 action plan we put in place in the second quarter of this year.
- We have begun creating a leaner global manufacturing and supply chain through the consolidations described above and by bringing together the operations team under one experienced leader, Ken Olson.
- We have re-energized and refocused sales by appointing experienced sales leaders. Ryan Wallace now leads direct sales to CROs, Pharma and certain large customer accounts where strategic selling of large multi-year sales are typical. Don Stewart and Henrik Schmidt are focusing on expanding the total available market and driving sales to Academic Research Customers in the Americas & APAC, and Europe, respectively.
- We have started rationalizing our product portfolio and pricing, eliminating non-strategic lower margin products and are driving cross selling of historical cellular and molecular products into CROs/Pharma and Pre-Clinical products into large academic labs.
Below is a summary of our progress on the strategic actions we announced for 2019 and 2020: