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Neogen Corp. F4Q08 (Qtr End 05/31/08) Earnings Call Transcript

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2008-07-22 12:06:08.0

Tags: Neogen Corp.

Question-and-Answer Session

Operator

(Operator Instructions). We are going to go first to Tony Brenner at Roth Capital Partners. Please go ahead.

Tony Brenner - Roth Capital Partners

Thank you. Two questions. First is, Lon you mentioned that you have been increased prices pretty much across the board. Can you indicate roughly when those price increases were implemented and approximately what a blended increase rate might have been?

Lon Bohannon

Yes, thanks for the question, Tony. We started actually increasing prices towards the middle of our 2008 fiscal year. So we had some price increases that were done in the November-December time frame. Certain of our groups went through additional price increases in April. Our Food Safety Group put through a blanket price increase that will take effect on July 1. We are having our monthly operations meeting for animal safety and we are talking about further price increases there going in on July 1. I do not know that we’ve an overall average.

We’ve had certain areas where we have had to do price increases in the 15% to 20% range and then we had certain products in the Acumedia product line for example where we had to put in some of those kinds of price increases. I would say we are certainly in that 5% to 7% range overall in terms of trying to put price increases through and we would like to think that we could have some kind of impact like that over the year.

However, we are going to have to continue to monitor the situation. We are not telling our customers that we can promise that we can put in a price increase and then not raise them again for 12 months. We know what the situation is like and we are going to do everything possible to hold down our cost and limit the impact of those and work with our customers to minimize the effect on them but we are also going to do what we need to do to maintain our margins.

Tony Brenner - Roth Capital Partners

Thank you. The other question I had is I am having a hard time reconciling the long list of double-digit sales increases for various product lines on the Animal Safety side with what apparently according to the release is virtually all of the sales increase for the year being contributed by the Kane and Rivard acquisitions?

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