Second quarter 2005 pro forma net income was $7.2 million, or $0.19 per share on a fully diluted basis, compared with $5.9 million, or $0.20 per share on a fully diluted basis, in the second quarter of 2004. Pro forma net income for the second quarter increased by 21.7% and fully diluted pro forma earnings per share decreased by 5.0%. Pro forma net income for the first six months of 2005 was $11.6 million, or $0.32 per share on a fully diluted basis, compared with $9.3 million, or $0.32 per share on a fully diluted basis, for the same period in 2004. Pro forma net income for the first six months of 2005 increased by 24.7% while fully diluted pro forma earnings per share remained the same for the first six months of 2005 and 2004. Reconciliations between GAAP results and pro forma results are presented in the attached tables and on the Company's web site (www.serologicals.com) under the Investor Relations tab.

President & CEO Perspectives
"We are very pleased with our results for the second quarter, reflecting our continued strong revenue growth and the improved business outlook that started towards the end of the first quarter and is anticipated to continue throughout 2005," said David A. Dodd, President and CEO. "We are seeing the positive impact of our integrated commercial operations, focused on high-impact customer development, supported by increased portfolio development and lean support functions. Both of our business segments continue to deliver results consistent with our expections for 2005. This is expected to have continuing benefit for the balance of 2005."

Commenting further, Mr. Dodd added, "In mid-July, we announced that we commenced the implementation of an accelerated integration program for our Research segment. The accelerated integration program represents a significant step in the integration of our Upstate and Chemicon units that will enable the company to further improve our high level of customer focus, development and support while enabling us to improve the day-to-day efficiency of the organization. The integration program will enable us to enhance our portfolio and focus more efforts and resources on direct customer development. Furthermore, by implementing the integration program we are achieving even greater synergies than we anticipated when we acquired Upstate.

The outlook for the balance of 2005 remains very positive:
-- We continue to add to our product portfolio for all our businesses with a highly focused approach on product and service niches to meet current and projected customer demand, with over 70% of our revenues resulting from products that are either patented, exclusively licensed or proprietary.

-- We continue to obtain new contracts and contract extensions to provide drug screening service, based around our expanding leadership position in kinase expression and kinase target profiling.

-- Customer projections for purchases of our key products, including EX-CYTE(R) and Incelligent(TM), reflect a significant pickup in the second half of the year consistent with our expectations.

-- We continue to identify and implement cost reduction initiatives in all parts of our business to improve gross margins and reduce overhead costs.

We expect that as in previous years, the second half of 2005 will be significantly stronger both in terms of revenue and earnings performance because of customer ordering patterns, with growth continuing both within our portfolio segments and our geographic areas. In summary, we continue to achieve revenue growth in excess of our markets and competitors, while significantly expanding our portfolio of proprietary products and services. This will continue to be our focus, as we increase the value delivered to our customers, employees and shareowners," Mr. Dodd added.

Significant accomplishments during the second quarter included:

-- Our research business units, Chemicon and Upstate, introduced 681 new products during the second quarter, including new Chemicon assays and reagents focused in the areas of neuroscience and stem cell research, a range of new Upstate kinases and multiplex Beadlyte(R) assays and the addition of 182 products in connection with the Specialty Media acquisition. Upstate is expanding its industry leading position by providing close to 250 kinases in their selectivity panel with an aggressive plan to substantially increase its kinase panel by the end of 2005. For the full-year, the Company expects to launch in excess of 1500 new products into the research business segment.

-- During the quarter, Upstate continued to further expand its product portfolio with continued emphasis on new products to support drug discovery activities with particular emphasis on cell biology-based products. Revenues for drug discovery activities increased 81% during the quarter and grew 94% during the first six months of 2005. This included the launch of a new Catch and Release(R) immunoprecipitation product, a new chromatin immunoprecipitation product (EZ-ChIP(TM)) and a new red-shifted assay to the company's fluorescence polarization products platform. In addition, Upstate announced the collaboration with CXR Biosciences to establish a battery of in-vitro screens to select candidate molecules for further development. The screening platform will utilize predictive toxicity and drug metabolism screens to profile compounds in various cell-based and in vitro assays.

-- Chemicon announced this week that it has signed a license with the Wisconsin Alumni Research Foundation (WARF) to commercialize research products derived from patented human embryonic stem (ES) cell technology. Chemicon is the first broad commercial collaborator to enter into such a licensing agreement with WARF, allowing it to develop and provide researchers worldwide access to a wide variety of proprietary human ES cell products. Chemicon acquires non-exclusive rights to WARF's complete patent portfolio of stem cell technologies, including patents invented by Dr. James Thomson, in order to facilitate and accelerate human embryonic stem cell research. These seminal patents cover several widely used and referenced human ES cell lines and procedures for their culture, propagation, differentiation and storage. The license covers a broad range of technologies that will make it easier, quicker and cheaper for scientists to conduct human embryonic stem cell research.

-- As indicated above, Serologicals announced the implementation of an accelerated integration program for our research segment. This program includes the consolidation of several core functions, including Business Segment Management, R&D/Business Development, Marketing, Technical Support, Scientific Sourcing, Intellectual Property/Licensing and Finance and Accounting. Serologicals expects to achieve operating efficiencies that should result in annual savings of $3.0 million to $3.5 million. The savings will be phased in over the balance of 2005. Serologicals expects to incur one time costs of approximately $2.0 million to $3.0 million in connection with this program as the result of severance costs, retention payments and relocation costs that will be recorded in the third quarter ended October 2, 2005. The majority of these costs are expected to be treated as adjustments to acquisition purchase price in connection with the purchase of the Upstate Group.

-- During the quarter, Celliance's EX-CYTE(R) plant in Lawrence, Kansas received its certification of compliance with ISO 9001:2000, which is part of a set of standards published by the International Organization for Standardization (ISO) that establishes a supplier's ability to provide consistent and conforming goods or services. The facility was ISO certified by an independent third party. During the quarter, Celliance also commenced the final phases of production validation at its Lawrence, Kansas plant. This phase of validation is continuing successfully and is expected to take approximately six months to complete based on scheduling commitments and testing requirements. Full manufacturing operations are expected to commence in early 2006. Updated customer projections received during first half of 2005 re-confirmed the need to initiate production at the Lawrence site in support of projected growing product demand beginning in early 2006.

-- Celliance also launched, during the quarter, a new Bovine Albumin manufactured exclusively from raw material sourced from animals raised in Australia. Celliance developed this product in order to combine the qualities of its premium albumin grades with the benefits of sourcing the raw material from Australia, a country classified as BSE-free (Bovine Spongiform Encephalopathy-free). As the leader in supplying specific cell culture supplements, Celliance recognizes the importance of delivering such alternatives to customers.

-- In addition, Celliance recently announced the introduction of Onco-CYTE(TM). Onco-CYTE(TM) is a serum-free, ready-to-use formulation that replaces Fetal Bovine Serum (FBS) in suspension culture for a variety of cancer cell lines in research and bioprocessing applications. Onco-CYTE(TM) is the second product to be added to the EX-CYTE(R) family of products. Hybri-CYTE(TM), launched in February 2005, was the first in a new line of serum-free cell culture supplements in the EX-CYTE(R) product line. This represents a continuing effort by Celliance to extend its product offering and to provide more value-added products to its customers.

-- In June the Company announced that its Board of Directors authorized a stock repurchase program to repurchase up to 2.0 million shares of the Company's common stock over the next three years ending in June 2008. The program is intended to be implemented through purchases made from time to time in the open market or through private transactions in accordance with applicable securities laws. The timing, pricing and size of purchases will depend on market conditions, prevailing stock prices and other considerations. As of today, the Company has completed the repurchase of approximately 125,000 shares of common stock. Funds for the repurchase of shares are expected to come primarily from cash generated from operations or funds on hand.

-- In late July, Serologicals settled a contractual claim against a customer of the Company's former therapeutic plasma business. The settlement, which the Company expects to conclude during the third quarter, will result in the Company's receipt of approximately $3.2 million in cash. The settlement, net of expenses of approximately $0.6 million, will be reported as Other Income during the third quarter.

-- Chemicon successfully completed the conversion of its customer service, product distribution and manufacturing functions to an enterprise resource planning system (SAP) during the quarter. The conversion was achieved on schedule and on budget with minimal disruption to operations. It is expected to improve our customer interfaces, to improve the quality and flows of information for our businesses and to assist Chemicon to streamline its operations. Serologicals continues the implementation of SAP as its global system for finance and accounting, sales and order processing, manufacturing and product distribution.

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