Lon M. Bohannon - President, Chief Operating Officer and Director James L. Herbert - Chairman and Chief Executive Officer Steven J. Quinlan - Chief Financial Officer, Principal Accounting Officer and Vice President

Brad Hoover - Sidoti & Company, LLC Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division Gregory Halter - Great Lake Review Reggie Miller - Credit Agricole Securities (USA) Inc., Research Division Stephen A. O'Neil - Hilliard Lyons, Research Division Gregory W. Halter - LJR Great Lakes Review Marco Rodriguez - Stonegate Securities Inc., Research Division Anton Brenner - Roth Capital Partners, LLC, Research Division Scott Gleason - Stephens Inc., Research Division

Welcome to Neogen's First Quarter Fiscal Year 2012 Earnings Results Conference Call. My name is Monica and I'll be your operator for today's call. [Operator Instructions] Please note that this conference is being recorded. I will now turn the call over to Jim Herbert. Mr. Herbert, you may begin. James L. Herbert: Thanks, Monica. And again, to those participating, good morning, and welcome to our regular quarterly conference call for investors and analysts. Today, we'll be reporting to you on the results of our first quarter, which ended on the 31st of August. And I'll remind you that some of the statements that are made here today could be termed as forward-looking statements, and these forward-looking statements, of course, are subject to certain risks and uncertainty. The actual results may differ from those that we discuss today. Those risks that are associated with our business are covered in part in the company's Form 10-K as filed with the Securities and Exchange Commission. In addition to those of you who are joining us today by live telephone conference, I also welcome those who may be joining by way of simulcast on the World Wide Web. These comments, along with some exhibits, will be available on the Web for approximately 90 days. Following our comments this morning, we'll entertain questions from participants who are joined on this live conference. And I'm joined today by Lon Bohannon, Neogen's President; and Steve Quinlan, our Chief Financial Officer. Earlier today, Neogen issued a press release that announced the results of our first quarter the 2012 fiscal year. And once again, we continue the succession of another record-breaking quarter in terms of both revenue and earnings. As I will discuss in the next few minutes, there were times during the last 3 months that our team of now approximately 700 employees felt some challenges. However, I think all of us once again remember that the toughest thing about success is you have to keep on being a success, and I think the results that we'll report today prove that. As the press release reported, our revenues increased in the first quarter by 6.5% and to $45.7 million. That compares to $42.9 million in the first quarter of last year. This quarter marked the 78th quarter in the past 83 in which we've shown increased revenues as compared to the year earlier. Given the nature of our business, I even marvel at times at how we only had 5 down quarters in the last 21 years. Net income for the first quarter was approximately $6 million or $0.25 a share. This is approximately 3% greater than the same quarter last year. Though this quarter obviously didn't show the strong double-digit growth at the top and the bottom lines that we normally can report to you, I'm reasonably satisfied with the results. Over 41% of our total revenues for the quarter came from international markets. For the past several months, we've been operating in what I would define as a sloppy world economy. Let me quickly say that I don't believe our operations are sloppy. In fact, quite to the contrary. However, we just had more moving parts in this quarter than we normally expect. In some cases, we delayed shipments to customers because of government-imposed currency transfers, which have now been resolved. In a few cases, our product mix almost turned topsy-turvy and increased revenues came from lower-gross-margin products than they were a year ago. Our revenues in our GeneSeek operations were down almost $1 million as compared to the prior year because of timing differences from parts of Europe, Australia and New Zealand. A year ago in the first quarter, we satisfied a pent-up demand that we'd been building for several months for a new genomic test, and that bulged that first quarter revenue of last year. However, that same business is now flowing on a more steady basis, and some of it will fall into the remainder of this fiscal year. Our operating margins for the quarter came in at 20.5%. This is down about 2% compared to the same quarter last year. However, I think many of you remember that it's long been our goal to try to hold the operating margins at around that 20% level. And I think we've been telling you for the past several months that we thought that 20% was about right, and it was a healthy objective and that we'd be continuing to invest more into our expansion efforts to take advantage of overall market growth. During the quarter, we used some of the cash balance to get better prepared for that growth that I just mentioned. We spent almost $5 million in Kentucky to add a 120,000-square foot facility to enlarge our manufacturing capacity, increase and improve our distribution operations and expand our sales and marketing space. We used about $800,000 in the acquisition of VeroMara labs in Scotland and the consolidation of those labs to our facilities in Ayr, Scotland. This opens up new markets for us in the aquaculture/mariculture area and also some cutting-edge technology related to diagnostic tests to detect important toxins in shellfish. We spent both financial and management resources during the quarter in expansion areas. This included getting 2 products ready for market launch that employ new technology that we believe has considerable long-term impact. We expected that the first product from each of these new platforms should be released this quarter, in fact one of them perhaps even as early as this week. We also spent considerable effort in increasing manpower during the quarter. We hired 66 new employees to allow us to take advantage of expanding market opportunities going forward. As I said, all of this is happening in the midst of a lot of moving parts. In the extreme southwestern part of the country, we've seen more severe drought and hot weather than has ever been recorded. Some estimate that as high as 40% of the cattle herds in Texas, the nation's largest cattle producer, have now been liquidated. In other parts of the country, we saw an overabundance of rain, which caused crops to get planted late in the spring and therefore pushed harvest back probably about several weeks as compared to last year. With a few exceptions such as the drought-ridden area, I think that our customer bases pretty much around the world is healthy, but I think the uncertainties have caused them to accumulate cash rather than grow. Let me stop at this point and turn the call over to Lon Bohannon to give you some of the real color of what's happening in both our Food Safety and our Animal Safety divisions in the first quarter and his thoughts on the months ahead. And then following Lon's comments, I'll come back and give you my opinion on some of the bright spots that we see and where I think that we're headed. Lon? Lon M. Bohannon: Thank you, Jim. And welcome to everyone listening on the conference call as well as those joining us via the Internet. As Jim already stated, Neogen issued a press release earlier today reporting yet another quarter of record-breaking results for Neogen. I would like to recognize the efforts of Neogen's outstanding employee team who came through again this quarter in the face of some difficult and unique comparisons to last year and once again enabled us to maintain our record of consistent growth in revenue and earnings. Jim's already reported the overall revenue growth as well as net income and earnings per share. Accordingly, I would like to discuss a few of the highlights in our Food Safety and the Animal Safety segments and provide some additional information that I believe will help you understand why our first quarter was stronger than it may appear based on a cursory view of the total increase in revenue and earnings. I'm going to begin by discussing performance at our Animal Safety Division. The Animal Safety group achieved overall sales growth of 8.4% in the first quarter. A number of product lines experienced significant growth. For example, sales of what we describe as Animal Care products, including our Kare line and small animal supplements in addition to vitamin injectables and hoof and leg care products were up 24% in the quarter. Our line of Ideal veterinary instruments achieved 26% revenue growth on the strength of increased market share with a large farm retail store chain, Tractor Supply Company, and a 56% growth in sales of Neogen's proprietary detectable needles. Our growth in that detectable needle business was a direct result of new marketing programs and increased investment in sales and marketing for this important product line. Our continued focus on marketing cleaners and disinfectants to help manage biosecurity-related concerns for producers of animal protein also paid dividends in the first quarter as sales for these product lines were approximately double our sales in the first quarter last year. Sales growth was broad based across many of our individual product SKUs for cleaners and disinfectants. In addition, we experienced strong growth for the C&D product line, both domestically and internationally, with particularly strong growth in the regions of Canada, Latin America and the Asia Pacific rim. So with all this strong growth, why were overall Animal Safety revenues up 8.4%? The primary reason, as Jim indicated, there was a 20% decline in first quarter sales of GeneSeek, Neogen's genetics-based service business acquired in April of 2010. The business model for GeneSeek includes testing services for research contracts and industry-related bids, the timing which can vary from quarter to quarter. In addition, and as Jim mentioned, last year's first quarter benefited from pent-up demand in international markets for high-density chips that inflated sales and affected comparisons to this year's first quarter. However, as Jim also indicated, growth prospects for the GeneSeek business remains solid. While this business may experience quarter-to-quarter sales and variability on occasion, the outlook for the rest of fiscal year 2012 and beyond is very positive. Also in the first quarter for Animal Safety, we saw a reduction of approximately $460,000 in sales for 2 international shipments that were delayed due to timing issues involving credit approval and inventory logistics. In total, the GeneSeek and international timing issues negatively affected Animal Safety's first quarter sales by $1,434,000 or 7%. Stated another way, excluding GeneSeek and the timing impact of those 2 international shipments, Animal Safety achieved first quarter revenue growth of 15%, all of which was organic, contributing to a very strong start for the year for the Animal Safety group. Now I will turn my attention to the Food Safety side of the business now, where we see somewhat of a similar scenario. A number of product lines exhibited exceptional growth in the quarter. Our Soleris line of optical microbial test systems for general spoilage organisms, like yeast and mold, experienced an outstanding quarter with overall growth of more than 50%. The AccuPoint test system used for general sanitation monitoring was up a solid 9% in the quarter, and sales of ampouled media and microfilters used for general microbial testing by the beverage industry was up 30%. Sales of tests for drug residues, led by revenues of Neogen's BetaStar dairy antibiotic test, increased 27% compared to the prior year. So once again, the obvious question is why the 5% overall increase to Food Safety revenues? And as with Animal Safety, the answer lies in just a few unique situations that adversely affected Food Safety first quarter sales comparisons for the prior year. First, as has been well documented in previous quarterly calls, sales were negatively impacted from a comparison standpoint by a significant reduction in mycotoxin sales, specifically sales of vomitoxin test kits and related extraction supplies and readers. In total, product sales related to vomitoxin testing were $950,000 below the same quarter last year due to significantly less weather-related vomitoxin contamination of commodity grain crops in last fall's harvest compared to a year earlier. In addition to the tough vomitoxin revenue comparison, Food Safety sales were also adversely affected by 2 other unique comparison events. A little over one year ago, our Neogen Europe operation was awarded a tender for histamine test kits that resulted in significant sales in last year's first quarter. A similar tender has not yet been submitted for bid this year. We also made a business decision to discontinue selling a traditional dehydrated culture media customer in the first quarter until we could negotiate and agree on a plan to jointly expand our business and stay within acceptable credit limits. The combination of these 2 items negatively impacted this year's first quarter Food Safety sales comparisons by another $500,000. Excluding the impact of these 2 items, along with that unique situation pertaining to vomitoxin sales due exclusively to weather-related crop contamination, the Food Safety organic sales growth in the first quarter was up a very respectable 12%. And when I remove the impact of the unique and unfavorable comparison events for both Food Safety and Animal Safety, overall sales growth for the quarter is calculated at 14%, virtually all of which is same-store sales growth. Now I realize we can't just disregard the effects of the tough quarter-to-quarter comparisons and try to explain away actual sales and earnings performance compared to the prior year. However, I did want our listeners to better understand and appreciate the reasons why our growth in the first quarter sales and earnings were less than we have been reporting, at least in recent quarters. I also want to take a few moments to make some brief comments regarding margins and our future prospects before turning the call back to Jim. There were no surprises in gross margins in our first quarter, and the change from the prior year is due to the overall change in product mix, as Jim indicated. Our current quarter included a lower overall mix of diagnostic products and a proportionately higher mix of cleaners and disinfectants, which has the effect of lowering gross margins in the current quarter when compared to last year. It should be noted, however, that our gross margins for the quarter were a solid 50.3%, which was extremely close to our internal budget of 50.4%. Operating profit for the quarter came in at 20.5% which was actually better than our internal budget for the quarter and above our stated goal of 20% of revenues. You also probably noticed that sales and marketing expense, expressed as a percent of sales, was higher than last year by 20 basis points despite our solid sales growth. This is in keeping with our stated objective of investing in sales and marketing this year to take advantage of the rapidly growing markets for Food and Animal Safety. Our balance sheet remains exceptionally strong with cash of more than $50 million and no long-term debt. Obviously, this provides Neogen a strong foundation for future growth initiatives to continue to take advantage of the significant opportunities we do see in our markets. In closing, I would say to you that the future growth prospects for Neogen are excellent. Domestic and international markets continue to expand, providing us with unprecedented opportunities for future growth. I wish our sales and earnings growth was a straight line reflecting 20% increase in each and every quarter, but, obviously, our first quarter results show that's an unrealistic expectation. I do think it's important to note that Neogen is not faced with declining sales due to poor economic conditions in the markets we serve, and we are not losing market share to competition or new technology. In fact, I believe quite the opposite is true. We are seeing sustained growth in our markets despite the unstable worldwide economic conditions, we continue to gain market share from competition in many of our defined industry market segments and I believe we have an excellent pipeline of new products for areas of concern, including drug residues, mycotoxins, pathogens and spoilage organisms. For these reasons and because we have a talented and experienced management group along with a loyal and dedicated employee team, I am more optimistic about Neogen's future that I have ever been. Now that concludes my comments for today. So at this point, I will turn the call back to Jim for some further remarks. James L. Herbert: Well, thanks, Lon, for that good color. And it was strictly intended as color to show you that our business is really sound. It's not intended to make any excuses for things that didn't reoccur. But as I said in my opening comments, a lot of the markets in which we operate had just been sloppy this summer. I don't think that -- as Lon said, I don't think we lost any market share. In fact, I think we may have made a few gains along. However, let's just take a quick look at what we believe is happening now as we sit here today. First of all, look at the domestic side of our Animal Safety business. The U.S. Department of Agriculture reported last week that they expected beef prices to be up 8% to 9% for this year due to all of the volatility of the summer. Prices during the summer have soared interestingly to record highs for beef due in part to the strong export demand for beef that we do not normally see. Now this export improvement, of course, was due to the value of the dollar compared to other currencies. Meanwhile, supplies of beef are expected to tighten as ranchers like me have been forced to liquidate herds due to the severe drought. In the same report, USDA estimated that the overall meat price, and this would just not be beef but it would be chicken and pork and all other meats, that their projection for 2011 is that that'll be as high as much as 7.5% higher than a year earlier. The same appears to be true for eggs, an area in which we operate, as the inventory of hens has decreased in -- during 5 of the last 7 months, and egg availability will be reduced as we move into the fall. Despite all this, overall food inflation is really not apt to get out of hand with estimates in the range of only about a 3% increase. This has also been an unusual year for grain production, the other side of our food chain. Wet weather, as I mentioned in my opening comments, in significant parts of the upper Midwest and the central corn belt caused crops to get planted later than normal. This means that to some, that area is going to be 2 to 3 weeks later in harvest. Some of this unusual weather condition has given rise to some aflatoxin, particularly in the lower part of the corn belt. We still don't know what to expect out of the major states, the I-states, because they're running a little bit behind. Last week's USDA report indicated that 21% of the corn crop nationwide is reported to be in poor or very poor condition, and that's about 3 times as much as we normally expect. Now some of this may give rise to some natural toxins that will require more testing. On the Animal Safety side, the summer has seen continued consolidation of the U.S. animal health distribution system with several of these being in the top 5 distributors in the U.S. One of the top 5 distributors of our products to farmers and ranchers bought another one of the top 5 group. Still another of the large distributors picked up several smaller distributors to add to their chain. We believe that all of this aids Neogen's revenues since our business and the relationship with the acquiring companies is quite good, and they're looking for strong partners. In the meantime, they're consolidating warehouses and sales organizations, and this is likely to have some negative impact until this integration gets completed. In the end, the overall market is certainly not going to shrink. We also have renewed our supply agreement with Tractor Supply, the nation's largest farm retailer, with just over 1,000 stores. There are a number of bright spots in our international markets. Our company locations in Brazil and Mexico continue to gain traction and show good increases compared to the prior year. From a product standpoint, our sales of cleaners and disinfectants have continued to increase as food producers in these countries get more concerned about controlling food safety back inside the farm gate. Latin American business for the quarter in the cleaners and disinfectants was up more than $1 million. Our business of these same products with Canada was up more than 80%. And as we've talked about GeneSeek, even though those revenues were down considerably in the first quarter, the outlook for that business continues to be exciting. And maybe another few words about that. I believe that we are still the largest independent genomic testing lab perhaps anywhere in the world, and demand for this technology will surely increase. Our revenues were down really only for one reason, and that was what happened in the backlog that Lon and I both have talked about, that -- and about 3,000 samples there amounted to almost $1 million in revenues compared to the prior year. Our actual sample numbers now are running at about 10% over last year even though revenues per sample are down somewhat. And we expected this downward pressure, in fact we probably created some of it. We more than offset the reduced selling price by a reduction in cost. We believe that over the course of the next several months, this will bring an increased number of customers who in the past have considered genomic testing to be too expensive. We also are expanding our sales and marketing effort in the animal genomics area, having just hired a very experienced animal geneticist who'll be working out of our Ayr, Scotland office to help expand further the genomics business in Europe, and we're making similar expansions in sales and marketing in our U.S. and Latin American markets. In summary, nothing has changed this past quarter to give us any reason to change the successful growth strategy that we've used in the past. We'll continue to grow the business to increase sales to our current customers, and we're adding sales and marketing resources to accomplish this. We'll continue to grow our business through new product development, and we have a strong R&D team that's working on a number of promising products. Some of these will begin to find their way into the market in the second quarter, as I mentioned earlier. We'll continue to grow the business through expanded international sales. Though a lot of these markets are pretty sloppy right now because of financial uncertainties, they all need to increase food production, and all will be putting on more pressure for food safety. Growth through acquisition is the fourth piece of our strategy that continues to be important. In fact, we have a few more opportunities for acquisitions on the radar today than we did at the beginning of the summer. We've walked away from some acquisitions in the past few months not necessarily because of price, but, more importantly, we couldn't get comfortable with how we'd integrate them into our model. So in a nutshell, I guess, in concluding my comments, the future is bright for both our Food and Animal Safety divisions, and earnings and the resulting increase in equity to our shareholders is equally bright. Let me -- before I finish my comments and forget to mention it, let me remind you that the annual meeting of Neogen's shareholders will be held on October 6 at 10:00 at the University Club of Michigan State University here in Lansing, Michigan. If your schedule allows, we certainly welcome you to join us as we continue to talk more about our future direction. If you have proxies that you've not yet voted, I'd encourage that you please get these completed in the next few days. This concludes our prepared comments for the morning. We can now open the conference call for any questions, not just on today's quarterly report, but any matters like those coming before the annual meeting or anything else that you might like to address concerning Neogen's operations. Monica, you can open for questions.

[Operator Instructions] Our first question comes from Steven Crowley of Craig-Hallum Capital. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: A couple of questions for you and follow-up. In terms of R&D, you made reference in your press release that there was a year-to-year decrease due to timing of your utilization of some outside resources. I'm wondering what we should think about as kind of a normalized quarterly run rate for R&D and the ramp you have planned over the balance of the year, since you've talked about beefing up that part of your operation also. James L. Herbert: Let me -- I'll let Steve give you the specific numbers, he carries those in his head better than I do. But last year, we did some outside validation for some products. I think it was part of our AOAC or our French validations. And that was paid earlier in the season, which made last year's look a little bit bigger in that particular quarter. But we are fully staffed and are growing. I just left a meeting with -- to come over here with my staff from the U.K. as well as the outside guys from Northern Ireland as we looked at several new products that are moving along very good through the R&D group. Kind of exciting to be there, and it's exciting to see these beginning to come out of the pipeline. But I'm going to let Steve Quinlan give you more on the actual numbers. Steven J. Quinlan: Yes. And Steve, I would say that somewhere in the 4% to 5% range is what we're looking for, for the full year. And as we said, it was really timing in the first quarter, but we're going to be somewhere in between 4% and 5% for the year. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: Okay, that's a pretty substantial jump since you came in at 3.3% in the first quarter. So does that mean we should think about quarterly R&D? I mean, the implication is at least $2 million a quarter on a go-forward basis, and is there some ramp to that? Steven J. Quinlan: $2 million is probably a good number, and there might be a little bit of a ramp to it. But a lot of these services, when we get the bill and when they're performed for us, the number is going to go up pretty significantly, pretty quickly. And we have a lot of projects underway right now. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: Okay. And it sounds like some of those projects are going to start to generate benefits, given Jim's comments earlier about those new technology platforms that are coming this quarter. James L. Herbert: Definitely, yes. And I might add to that, on both of those, Steve, both of those platforms. They're not just a single product. There is a single product, and for competitive reasons I don't want to go into a lot of detail. But one of those platforms has got the -- the first product comes off, and it's got 5 sisters behind it that will be coming out probably once a quarter as we look at going forward. Another one of those -- the other one of those platforms has got one product that comes out, and that will be out in the quarter, definitely, and it's got about 4 sisters behind it. So both of those represent more than just a single product. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: Okay. Then a couple of other numbers questions and I'll hop back in the queue. International certainly has been a developing story for you. You gave us the percent of sales it was in this year's Q1. Do you have the comparable statistic for last year's Q1? Steven J. Quinlan: Yes, it was 39.8% last year. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: Okay. That's great. And that growth seems to be driven by Latin America, Asia-Pacific and then Europe. How big a piece is Europe? And did that grow noticeably despite the economic backdrop we've been talking about? James L. Herbert: Well, the -- our company operations where we maintain our own sales organization in the U. K., Germany and France continue to be very positive. However, we also operate the distribution portion for all of our EU distributors out of there. So that covers countries like Greece, like Spain, like Italy and all the rest of the EU countries. Those, obviously, have been kind of sloppy, and that side of the revenues over there was down. We don't think it's permanent by any stretch, but it's just -- there's been -- a lot of things have just been -- were just sloppy over there during the summer. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: And then in terms of foreign currency. Steve Quinlan, maybe you have the impact or -- on sales in the quarter and on either operating or pre-tax income in the quarter? Steven J. Quinlan: Revenue, Steve, was almost $900,000. That was a good guy. And then operating income was about $0.5 million. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: Also a gain? Steven J. Quinlan: Yes. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: Okay. And where -- does that capture all the impact of FX? Or were there some below the operating income line? Steven J. Quinlan: There were some below, and that was, I believe -- give me a second here. I think it was maybe $150,000, but... James L. Herbert: That was in hedging activities. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: And so that would have been in the other direction related to the hedge or... Steven J. Quinlan: Yes, I'm sorry. It was $110,000, and it was an offset. So it was a reduction in income. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: Okay. So it was a hit? Expense? Steven J. Quinlan: Yes. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: Okay, that's helpful. And then just one more for me and I'll get back in the queue. In terms of GeneSeek, you've advertised some lumpiness as a possibility in this -- in the business since you acquired it. You also mentioned that you prompted maybe some of the weakness in the top line because of your efforts to expand the market with some lower pricing. Your confidence in the balance of the year or the future, I should say, for that business in the pipeline that you're -- is that driven by some of those large pieces of business that seem to be out there for the balance of the year? Or are you seeing the expansion in customer base to smaller breeders as you anticipated? I'm just wondering what's behind your confidence in GeneSeek. James L. Herbert: We are beginning to see more emphasis from smaller breeders. That's not -- that didn't manifest itself in this first quarter, and it may be a little slower to manifest itself in the second quarter. Nevertheless, it's there. And I won't bore you with all of the details of why we know it, but we know there's half a dozen different breed associations that are looking at putting in new training models and are getting set up to do some things because they're going to have to. But the big guys -- for instance, our guys just came back from Australia and New Zealand. That business down there looks stronger than a year ago. We're already beginning to see some of that come in. The same is true of some of the things that we're seeing in Europe. I just came back a week ago from Ireland. Good opportunities as we look at what's happening there. And that was one of the things, of course, that prompted us to hire really an outstanding animal geneticist to -- who lives in England, who'll be working through our Ayr office in expansion of our genomics business in Europe. We already have some good business, but this will just help expand that and give us more visibility in that marketplace.

Our next question comes from Scott Gleason of Stephens. Scott Gleason - Stephens Inc., Research Division: I guess let's start off with Jim, I want to -- I know you guys don't give kind of guidance. But I guess just in light of this quarter, and it sounded like a lot of one-time event. Is the right way to think about kind of the second quarter of 2012 here that you probably should have recovered a more kind of a normalized kind of low-double-digit type organic growth rate for the business? Lon M. Bohannon: Well, I would sure like to think that would be the case. It was -- I mean Jim used the term sloppy quarter, used the term tough comparisons and unique one-time events kind of affecting the comparisons and things. But because of all the things we've talked about, the expanding markets, the opportunities we see, the new products coming down the pipeline, we just feel that if we go through the rest of this year, we're going to be starting the normal kind of organic growth patterns that we've seen historically. Scott Gleason - Stephens Inc., Research Division: Okay. James L. Herbert: But I don't think there's any question that the market potential is out there. And because of a lot of things, the market gets, you would say lumpy from quarter to quarter. We've really got to look at where we're going to continue to grow the business. And don't get me wrong, I was really disappointed in the market's reaction to our report this morning, and we don't like to be disappointing the market. But I think what we did is right. And if I had to go back and do it again, we'd do the same thing because we've got to build up for these huge market opportunities that we've got coming. And we're doing a lot of internal staff that we're not talking about. Ed Bradley is making some changes in his team. He's recently brought on a new sales manager for the U.S. portion of the business that we really like. It's going to make some changes and some differences. So we just -- we're -- the opportunity is out there, and we're going to do the right things to continue to grow. Scott Gleason - Stephens Inc., Research Division: Great. And I guess just looking a little bit more detail on the acquisition front. Can you guys talk about if you have any outstanding letters of intent? Is there any challenge right now in terms of kind of finding deals or valuations kind of? Is there anything that's kind of changed in terms of the overall outlook there? Could you just give us maybe a little bit more color or guidance on that front? James L. Herbert: Yes, we don't have any signed letters of intent. We do have -- I think as I mentioned in my comments, we've got a little better inventory on our radar screen than we did beginning of the summer. I think this is particularly going to be true for closely held companies. It may or may not impact us. But I think anybody who's looking around at a closely held company figures that their tax rate next year is going to be a lot higher than it is this year. So I think that will be for some sellers, that will make those sellers more interested in doing a deal in what's left of this year. As I said, I don't know that, that necessarily will impact what we're doing, but I think it will impact the overall marketplace out there. Scott Gleason - Stephens Inc., Research Division: Great. And Mr. Herbert, can you talk a little bit about some of the deals you're looking at from a size standpoint? Are they more of kind of small, kind of tuck-in product deals? Or is anything that could be a little bit more transformational for the business, like the GeneSeek acquisition was last year? James L. Herbert: Yes, I think -- I'd love to tell you that we got the square rifle bead on a $50 million business, but we don't. There's just not -- doesn't seem to be anybody in that size that fits what we're doing. There are a couple of the ones that we're looking at are in the range of $10 million apiece, which that's helpful. There's another one in there that's a little smaller than that, but nothing as small as the VeroMara business. The VeroMara business was less than $1 million. Now we're bidding on some business over there. And don't put this in your model, but we looked at all along that one of the reasons we wanted that business is there's a couple of million dollars in the Scottish testing business that we think we ought to be able to get a significant portion of. We will grow that business certainly whether we get that bid or not, but nothing that's down to the size of VeroMara. But as I said, we wouldn't have bought VeroMara had it not been a real good strategic fit. Some of the things that they're doing in shellfish toxins now have really aided what we're doing in the development of new diagnostic, more rapid diagnostic tests. So there'll be -- there's likely going to be 1 or 2 opportunities out there that will be strategic from the standpoint of introducing -- opening up a new market spot for us or providing us some technology that we don't have today. Scott Gleason - Stephens Inc., Research Division: Great. And I guess the last question just for Steve. It sounds like you guys are -- that it's going to be a little bit kind of a year of investment in terms of adding some new sales and marketing folks, and then you should see the R&D spend kind of come back to a more normalized rate here. Can you talk to us a little bit about kind of on a year-over-year basis how we should be thinking about operating margins just relative to where you guys were last year? Over 20% seems like pretty high a margin for these types of businesses. Lon M. Bohannon: Yes, Scott, this is Lon. I think the right way to look at this, we -- and to take advantage of the opportunities that are out there, we have to be a little bit careful about holding back on expenses and investment and getting that operating profit number up too high. I made the comment during our annual conference call for the annual results for last year that I wish that, that 0.8% that we had in there last year for the year in operating profit that came in at 20.8%, we had taken some of that cash and invested it in infrastructure, particularly sales and marketing going forward. So, I mean, we're going to continue to control expenses and manage expenses and help that operating profit to be as good as it can. But we cannot -- we've made a decision, because there are such good opportunities out there, that we need to invest in sales and marketing and R&D, and we're going to continue to do that going forward. And our own internal objectives would not be much higher than 20% in terms of operating profit for the year.

Our next question comes from Tony Brenner of Roth Capital Partners. Anton Brenner - Roth Capital Partners, LLC, Research Division: A couple of questions. First of all, I believe Lon mentioned that you hired 66 new employees in the first quarter. I presume most of those, if not all of them, were in sales and marketing. But as I recall, the intention was to hire a good deal higher number than that, around 90 to 100, I suspect, and which implies that there's additional hiring in the second quarter. Plus, I would guess that all those 66 employees were not on board on day 1 of the first quarter. So the question is, therefore, would sales and marketing show a more dramatic increase year-over-year in the second quarter, and even versus the first quarter in terms of percent of revenues? James L. Herbert: Well, let me get part of it, and then I'll let Steve and Lon clean it up. But that my mention on the 66 employees. And it wasn't just sales and marketing, it was spread throughout. We've increased our manufacturing group, we've increased our technical group in Scotland to take advantage of particularly some new laboratory business that we've got there. So it's been -- it was pretty widespread. You're right that we didn't hire them all on the first day of the quarter. The -- but by the same token, I think we've got them spread out so that there's not going to be a big hit at any point in time, Tony. We've got -- I think I looked yesterday at our open positions that would then provide me throughout the country for all of our locations, and I think there's like 35 or 40 open positions posted right now. So that would come close to what you were talking about. Somewhere along the way, somebody mentioned the number of 90. I was using, interestingly, I'll say more than 650 employees, and when I was putting together my opening comments, and our HR people came back and said, "Jim, we're already at 700." So 650 is out of step. So that does reflect some of the increases a little bit. And we've upgraded some places, and I think you need to always be upgrading. Part of that 66, one of them at least, was an upgrade in what we did. And it's a significant management in sales and marketing in Food Safety side. Lon M. Bohannon: Okay, Tony, I'll continue along with that. We just come into the year with, I think, 90 or somewhere between 90 or 100 open positions. That was total positions for Neogen, not just sales and marketing. A big chunk of those open positions are related to sales and marketing, some R&D and sales and marketing support positions. And it will continue to ramp up as we go up through the year. We still have some open positions there to fill. And not all of those people, as you rightly stated, came in at the beginning of day 1 in the first quarter. So we'll still see some ramp-up in investment in the sales and marketing area as we go through the year. Anton Brenner - Roth Capital Partners, LLC, Research Division: So not a dramatic increase, it doesn't sound like, in terms of sales and marketing spending? James L. Herbert: No. As a percentage of revenue, not, Tony. I think you'll see the net dollars go up but as a percent of revenue, it shouldn't be. Anton Brenner - Roth Capital Partners, LLC, Research Division: Okay. Secondly, in the release, it was mentioned that China was particularly strong. Could you tell us what percent of sales China is up to now? James L. Herbert: Lon, you want to... Lon M. Bohannon: I don't know if I have this -- the percentage for that country. We had more than $800,000 in sales that went into China in the first quarter. We have seen some real breakthroughs in China, particularly with a couple of our product lines on the Food Safety side with our BetaStar dairy antibiotic test and particularly our Soleris optical microbial test systems for spoilage organisms. We placed a lot more Soleris systems in the first quarter than we anticipated. The outlook for that country continues to be favorable. We've got some traction started there now in some of those key markets. One of the things that we did last year that's paying dividends is we broke away that country so we can have our own direct sales efforts there rather than going through a single large distributor for the dairy industry. And that's paying dividends, and we expect that to continue as we go through the rest of this year. Anton Brenner - Roth Capital Partners, LLC, Research Division: Great. My last question. Veterinary instruments were up 26% last year. In this first quarter, they were up 35%. I know you cited some of the reasons that you're increasing share and -- with some of your retail distributors. But I wonder if you could discuss or quantify what veterinary sales or instrument sales are, and why your shares -- your market share continues to increase. What's special about that business? Lon M. Bohannon: Well, we've had that -- that business goes back to 1985 when we acquired the Ideal instrument line. We used to say 55 years. Now it's a 75-year-old or 80-year-old business. We continued to look at some new products, products that we can bring in there. The detectable needle was a good example of that. And it's really a good block and tackle in selling. We were one of the first ones that identified some movement for this retail farm store market in terms of products moving through that distribution channel. And so we've taken advantage of that over the last several years. And our people there have done a good job of paying attention to the marketplace, understanding what those customers are looking for and designing animal care, everything from packaging to the way the product works, designing programs that appeal and have allowed us to continue to gain market share there. So it has been broad based against -- across a lot of product lines, and we just do a good job of sales and marketing there. Anton Brenner - Roth Capital Partners, LLC, Research Division: [Indiscernible]. James L. Herbert: Go ahead, sure. Excuse, me, Tony. Go ahead. Anton Brenner - Roth Capital Partners, LLC, Research Division: I just trying to ask what are the revenues. Lon M. Bohannon: Well, I'm pretty sure that if you look at total veterinary instruments, we're over $10 million in sales, in annual sales for that product line. You got numbers for the first quarter? Steven J. Quinlan: Yes, it was $3.2 million in the first quarter. James L. Herbert: So Tony, I know you know the story and everybody may not, so it will give me an opportunity to tell it. Lon mentioned detectable needle sales and that's -- it's Animal Safety, but it goes in Food Safety. And those of you who haven't heard that story, the industry came to us back a few years ago and said that, "We've got broken needles that are going through the processing plant not being detected because our metal detectors won't detect them. What can you do to help us?" We were able to put together some unique metallurgy to do that, got patents on it and pretty much have a monopoly on that particular technology out there, which a patent, of course, is supposed to give you. But just this past quarter, we had an example of that where one of the major U.S. pork suppliers called in a panic to say, "We've got a customer in Japan who has found a piece of fresh pork with a needle in it, and they buy from people other than us, and we'd like to make sure that it's not one of our needles." And they were able to send that picture through with all the dimensions. And within less than 24 hours, we clearly identified that it was not our needle, or we suspected it came from, and made a huge difference, obviously, to our customer in dealing with their Japanese customer. So we're seeing, Lon mentioned, an increase in sales of detectable needles, and I think we'll continue to see that.

Our next question comes from Marco Rodriguez of Stonegate Securities. Marco Rodriguez - Stonegate Securities Inc., Research Division: I did have one quick question in regard to the gross margin. You mentioned quite a few, I guess, one-time items that negatively affected the top line and, understandably, shifted the product mix. I wonder if you could, perhaps, quantify what your gross margins would have been had you not had those revenue effects? James L. Herbert: There's a lot of mix in there. I'm not sure that... Steven J. Quinlan: We've seen that gross margin move from like 49% to 52%, which is -- when you're talking about 350 basis points from quarter-to-quarter based on the mix. And it just -- it really does depend on overall, how much of that is I refer to as diagnostic products. But we've got hundreds and hundreds of SKUs, product lines, and so the generalization of it being Food Safety versus Animal Safety or diagnostic products versus things like cleaners and disinfectants. This particular quarter, that significant increase in sales that Jim referred to with cleaners and disinfectants had a big impact on the gross margin level. However, if you recall from my comments, our operating profit actually was higher than our internal budget. So that's why we really continue to focus on the operating profit line. Marco Rodriguez - Stonegate Securities Inc., Research Division: Would it be fair to say that the gross margin would have been higher than it came in? Or you think it would be around the same level if you didn't have those one-time items? James L. Herbert: Well, I don't think they were one-time items. They just -- there was a SKU in the percent of revenues that came from cleaners and disinfectants. That was $1 million -- I think I said $1 million worth increase in cleaners and disinfectants going into the Latin American market. That would have been -- that's a long ways down there. You got transportation involved, not only the margins and the product. That would have an impact. But it's kind of hard to say. We always -- obviously, we report gross margins, and we look at them and we worry about them as it relates to budgets. But we really think you've got to test the business at the operating margin side where you might have a GeneSeek, for instance, doesn't have all that good a gross margin. But their cost below the gross margin line is very good, which brings our end at close to 30%. So those -- we think you really have to look at that.

Our next question comes from Paul Knight of CLSA. Reggie Miller - Credit Agricole Securities (USA) Inc., Research Division: This is Reggie Miller for Paul Knight. Paul's in China right now. Real quick one on aflatoxin comps. Can you talk about those and give a little more color what we should expect for that for the year? Steven J. Quinlan: Did you say aflatoxin comps? Reggie Miller - Credit Agricole Securities (USA) Inc., Research Division: Yes. Steven J. Quinlan: Well, I think as a number of people have heard, there were large parts of the Southwest and South that were in drought conditions for a big chunk of the summer. And as a result of that, the positive news is we are seeing an increase in aflatoxin or the incidence of aflatoxin in things like corn. The bad news is some of those areas were hit so hard with drought that there's not much crop there to test. But we expect to see aflatoxin in this year's harvest to be up. It was up very nice in the first quarter, and so we'll see some -- we'll likely see some positive comps for that particular mycotoxin, in the U.S. crop anyway, for this harvest year. James L. Herbert: Yes, I haven't seen the harvest number. The crop report over the -- today is Tuesday. I guess it'd be out today. And so I don't know what percent we got harvested last week in the I-states: Illinois, Iowa and Indiana. Those are the 3 critical corn states. But they were down around 18%, 17%, 18% harvested, as I remember, last week. And so that's going to make a difference when we start to see that crop come out in the field. And we really don't know. I mean, it's still kind of wet and soggy, and they still got to get it out. So it's a little premature to be doing much guessing there, other than the fact that we know that 21% of the nation's corn crop was in poor -- a very poor condition. So that could mean that we've got molds there. It could mean that we're going to have toxins. It could mean that the corn just didn't fill out to the end of the cob because of the hot weather. It could mean a lot of things. We don't really know or won't know here as we play this whole harvest game for the next 30 days. Reggie Miller - Credit Agricole Securities (USA) Inc., Research Division: And going back to GeneSeek, as far as the opportunity goes for the rest of the year, do you see more demand coming from industry or research? Or -- and then internationally as you guys extend out there, where do you demand coming from? James L. Herbert: Well, I think research is always there, and you'd like to get it. But it's certainly not what drives the business or drives our interest in the business. It's the commercial side. We see that the dairy business is going to continue. We do a lot of testing or, essentially, all of the artificial inseminations that's scattered around not just this country but outside of the U.S. So our dairy business will continue to be strong. There is some strong interest in what's happening in the sheep business, Australia, New Zealand, as well some things that are coming out of France. So we would expect that, that will increase. I think we're going to see -- we're already seeing some increased interest in what's happening in swine genetics. There are 2 major players that are the 2 major hybrid producers. But then there a lot of other produces that are producing -- they've got their own genetic lines. And so our people are with 1 or 2 of them this week that -- and not the big testers but probably will be significant in larger testers as they're doing a better job of building up their swine genetics program. A little interest in the horse side. We control the horse chip. That's not food and animal, but, as some of you know, we've got a strong position in the professional equine market. And right now, the chip is used for genetics testing in horses. We are the only one that has that. So though we do prefer to do the testing, the genomic testing, in some cases we actually will sell the chip to somebody else. So that business will pick up. And it's not going to be huge, but it's going to be nice. So it's a -- I'd say that's -- I'm sounding like a politician in my answer, but I think that the biggest increases there are going to come from industry versus universities or other research programs. But we're in the middle of a nice research program now with USDA and 2 land grant colleges to determine if we can find the genetic difference between high shedders and low shedders of beef cattle and E. coli organisms. So there'll be some continued good opportunities. Reggie Miller - Credit Agricole Securities (USA) Inc., Research Division: Okay, that's helpful. And last question. As the percentage of sales increases with international customers, should we expect the mix to lower margins, kind of you saw on Animal Safety division this quarter, should we see more growth out of that division versus Food Safety? Or how do you think about that? Steven J. Quinlan: I think, overall, when you look at our budgets for this year, I don't think there's a significant difference in terms of opportunities for growth that we see internally for the Animal Safety versus Food Safety. We did have -- Animal Safety was up 8.4% this quarter versus, I don't know, 4.6% or 5% for Food Safety. But going forward, we think both of those operating segments have the opportunity to grow in strong double digits organically. So I think as we move through the year, we would expect both of those to do well from an organic growth standpoint. James L. Herbert: Don (sic) [Reggie], as you look at gross margins -- and again, it's my operating profit story, but if we sell to a distributor, then he has all of the costs of sales and marketing, the principal costs of sales and marketing and distribution to get it to the final customer. So therefore, we end up -- that part goes out to the lower gross margin. Then if we sell it through our own sales and marketing group, we've got a higher gross margin there, but we also have more costs to grow the land. So when you figure it all out, it's either they come out in operating profits, operating margin, more so than the gross margins. Reggie Miller - Credit Agricole Securities (USA) Inc., Research Division: And as you target international, more percent of sales than international costumers, do you expect the mix to be more Animal Safety versus Food Safety? James L. Herbert: Well, right now, it's -- would be more Food Safety. Our Food Safety business and organization is much stronger outside of the U.S. than our Animal Safety business.

Our next question comes from Steve O'Neill Hilliard Lyons. Stephen A. O'Neil - Hilliard Lyons, Research Division: Well, I'll make it fast. You mentioned mycotoxin sales were down by $1 million. What is that on a percentage basis? Steven J. Quinlan: We're looking that up. Overall, what we call -- we combine them. And specifically, that category is called natural toxins. And overall, it was down about 10% compared to last year. Stephen A. O'Neil - Hilliard Lyons, Research Division: Okay. And also, you didn't discuss rodentocides or food allergens. I wonder if you could. Steven J. Quinlan: Well, in the area of rodenticides, sales in the first quarter were down a little bit compared to last year. That was actually the plan. I don't know how much everyone will remember, but there was a new EPA, they call it Risk Mitigation Decision or RMD, decision that went into effect on June 4. And the effect of that, when you have that kind of a rule change and it affects the nature of what kind of crops you can have out there in the channels of trade, there was an extremely large buy-in of rodentocides as we moved through the second half of last fiscal year. So some of our distributors took advantage of that situation to stock up on those so they would already have them in the channels of trade and would be able to sell them before they had to switch over to new packaging designs and different rodenticides. So there wasn't any real surprises in the rodentocide area for us in the first quarter. But it was down compared to the prior year. Allergens, we're just -- I think that kind of describes -- or I would say their performance, they were actually up a little bit compared to last year, but it was just -- it was more sloppy than it was a significant growth there. So we just had kind of a lull in that quarter as it relates to allergens. As I think most of you know, we're very strong in the allergen, the food allergen market. Definitely a leader out there in terms of the marketplace. And are optimistic going forward for that product line, as we have been for a number of years. James L. Herbert: Yes. And the E. coli, to Lon's comments there, 2 things. First of all, if we look at the food recalls during the past several months, there's still a preponderance of the recalls are based on failure to report an allergenic ingredient on the label of a product. So there's still a lot of pressure not just here but also in the EU. We are continuing to develop more products for the detection of allergens. For instance, right now, we don't have a lateral flow device strip for the detection of mustard. And we've got a microtiter well but not a lateral flow. So our group in the U.K. is finishing up that one. We're looking at, all of a sudden, there's bigger interest in celery. So we've got to -- we're working on a new product to be able to test for celery. So it's an ongoing development area as more people are -- become more concerned about testing. A lot of it is environmental. We want to make sure that it's not somehow on the surfaces or in the nozzles. Those people who are processing milk and they shift over at late afternoon to bottled orange juice, want to make sure they got all the milk out of the lines. So it will continue to grow, and I think we'll continue to be -- we'll continue to invest money in the intent of continuing to be the leader.

Our next question comes from Greg Halter of Great Lakes Review. Gregory W. Halter - LJR Great Lakes Review: You mentioned in the release about research and development. And specifically, there was a decline in contracted outside R&D services. I'm just wondering if you had a range on how much that outside R&D may be of the total for the company. James L. Herbert: Not without doing some research. Lon M. Bohannon: Yes, I think that's something we're going to have to get back to you on. We budget individually for individual projects on R&D, Greg, and that can include internal development with our own staff and as well as these contracted services for certain types of technical work, sometimes for critical reagents and sometimes for other kinds of things. But we don't have a ready roll-up of all of those specific contracts and services to give us one number for all different projects. James L. Herbert: Yes. As an example, I just had a meeting with our outside team from Queens University in Belfast, Northern Ireland, were in town this week. And then they're working closely hand-in-hand with us on a contract basis. And also in town is the lead person from one of the FDA offices in Washington. So there's a case of where we've got a couple of outside contracts that are a part of product development. Gregory Halter - Great Lake Review: Okay. And in your release as well in the Animal Safety discussion, you talk about new markets such as greenhouse and aquaculture industries. I just wonder if that's something that you've been involved with in the past. And if not, what kind of potential do you see from each one of those and maybe what kind of products would serve those areas? James L. Herbert: Yes. There again, I think that was in reference to cleaners and disinfectant. We've been involved. There's -- we've got what we call our Animal Safety group. We've got what they call our agronomics team. They're working with, for instance, rodenticides that are going into apple orchards and that are going into fresh vegetable crops where they have to be controlled versus going into an animal confined building. We also have, and we're stepping up, our program. I don't know that it's going to be huge, but it's going to be up or we're stepping up our program to market our diagnostic test to be able to detect plant pathogens. That's an old product line of the company, one that we developed in the U.S. It was fairly -- it was a nice business. That was a similar product line that was developed in Scotland. A couple of our senior management over there are sort of world-recognized in the plant pathology area. But we haven't been actively marketing that product outside of a few combined countries in the EU. We spread that out this year. We've put a person on board to work the North American markets. And they'll be working with some of those same people as it relates to the agronomics areas. So -- and the disinfectants did well in aquaculture. We have a product that we distribute for DuPont as part of our national program or North American program. That is being used in some places in other countries. It's not yet approved for use, but there are some approval processes going on there. Particularly used in hatcheries, whether it's for aquaculture production, reducing, for instance, trout fingerlings or smoked salmon. They're going to go into aquaculture. Or in a lot of cases, it's state and federal fisheries that are producing through hatcheries those same animals to go for a release -- catch and release to go in the wild harvest. So there are some opportunities there. It's the same product. We're already testing that area. So it's synergistic to what we're doing. It's going to be nice but not something that you'll run out and buy stock on based on that, Mark (sic) [Greg]. Gregory Halter - Great Lake Review: Okay. And do you have the cash flow from operations figure for the quarter? Steven J. Quinlan: Yes, I do. We generated about $1.4 million in the quarter. And let me just kind of give you the pieces for that. Our receivables are up $4 million, actually $4 million for the quarter. And that's really reflecting a large customer that did not -- that we were expecting payment in August that we did not receive until September. That was about $1.7 million of that number. The rest of it is really the fact that we had $2 million more in sales in this August than we did in May. And, well, like a 2-day decrease in our DSO. So that kind of talks about the receivable impact on the cash flow. Our inventories are up about $2 million, and that's really -- we had a couple of large international orders that came in near the end of the quarter. And we've had some inventory build partly for the aflatoxin outbreak and a couple of new products that we're getting ready to put into the market. And then we also had a $1.9 million payment on GeneSeek, that contingent payment that we accrued last year and paid Year 1 out in June of this year, and that was $1.9 million. So we're doing a -- we'll have our quarter out at the end of this week. But if we're looking at last year and comparing it to this year, those are the significant pieces of the change in the cash flow from operations. The short answer is $1.4 million is the number. Gregory Halter - Great Lake Review: Back up on that. The GeneSeek payment. Will that show underneath the -- under the line on the cash flow from ops, though, or not? Steven J. Quinlan: No, because that was an accrual that we had. So it's actually in our accrued balance and payables at year-end. And we had -- that was in our 10-Q disclosure. It will also be in our quarterly disclosure. Gregory Halter - Great Lake Review: All right. And what was your capital spending in the quarter? And what would you expect for the full year? Steven J. Quinlan: We spent about $6.8 million in the quarter. And if you remember, $5 million of that was the building that we bought in Lexington, Kentucky for our expansion. So the rest of that was $1.8 million was kind of our normal CapEx. And we're projecting to spend somewhere around $6 million for CapEx for the full year. Gregory W. Halter - LJR Great Lakes Review: $6 million plus or $6.8 million? Steven J. Quinlan: Correct. I'm sorry, yes, in addition to that building. Gregory Halter - Great Lake Review: One final one. Obviously, the Food Monetization Act was passed. But has anything happened there yet? Or is it going to take years before anything really gets promulgated and put into action by the government? James L. Herbert: Well, probably not years but certainly months. No, you're exactly right there. We're pretty close contact to what's going on. And then that has been finalized, too. That's pretty sloppy up there, too. Lon M. Bohannon: We are -- Jim is right. We stay very close to that because potentially, it can have a nice impact on our business. And there are specific implementation dates that are in there, but the way this -- the way our government is moving at a snail's pace and stuff, when we go through the comment periods and people's opportunity to delay those kinds of things, it just takes longer than it should. But we're staying on top of it and keeping and paying attention to those implementation dates so we can make sure our customers are aware, provide the right kind of service to them as they come into compliance with that piece of legislation.

Our next question -- and our last question for today comes from Brad Hoover from Sidoti & Company. Brad Hoover - Sidoti & Company, LLC: I just wanted to ask one thing on dehydrated culture media. I think, Lon, you mentioned it in your prepared remarks. Is that -- are the customers there mostly large pharmaceutical and diagnostic companies? And then I guess how are sales there trending? And how much the outlook look given, I guess, Jim, you kind of called it a sloppy environment? Lon M. Bohannon: We do - that traditional business, there are a lot of pharmaceutical tech companies. There's companies that take our dehydrated culture medium and put them into port plates that are then sold in a number of different markets, including the clinical markets. We sell that dehydrated culture media to companies that are manufacturing vaccines on the human and even more so on the animal side. And so all those are the nature and the type of customers that are generally in that market. It's another one where those customers have kind of moved up and down in that particular business. We acquired that dehydrated culture business years ago because we wanted access to those high-grade culture media for use within Food Safety for testing specific pathogens where you have to grow up the bugs first. And that has worked out very well for us, and that part of the business continues to grow. In fact, it was up 46% in our first quarter. And that's where a lot of our focus is. But the traditional -- what we call the traditional part of that business continues to be successful. It's growing, and it's growing at -- it's had quarters and years when it's been double digits and even years where it's been over 20%. But if we get in the -- if we get in that 7% to 8% kind of growth rate range with that product line, we feel pretty good about it. James L. Herbert: And as Lon mentioned, our real focus there is not to go out and try to take a lot of that low-margin business, but our real focus is how well that fits into our Food Safety side of the business all the way across what we're doing with Soleris vials, what we're doing with a whole lot of things. Our business is considerably stronger today in Food Safety than it would be the other way if we didn't have this and, we think, our real advantage over what we have with most of our competitors. Brad Hoover - Sidoti & Company, LLC: And just final question. Tax rate. What should we model for that for the rest of the year? Steven J. Quinlan: Well, we had it budgeted. I believe we're 35.5%, 35.6% for the year. And that's about where we think it's going to end. James L. Herbert: Good. Well Monica, it sounds like we're at the end of the questions. And to everybody, I'd say thank you. We appreciate your continued support. I'd be less than honest if I said I wasn't particularly pleased with what the stock price had done this morning. But I think it's a buying opportunity. We can then -- we're going to continue to grow. And that's not -- I'm not giving you advice on what the future is. I'm just telling you what it looks like from now. We are -- we reported double digits for you this morning. But frankly, as I said, I think, earlier in my comments, if I had to do it over again, I don't going I'd do much different because we're concerned about what this company's going to look like next quarter and next year and the year after, and we think we're doing the right thing. Again, if you got proxies that you hadn't voted, please get those in. We'd appreciate it. And for anybody who's available, we'd love to see you at the annual meeting of shareholders on the 6th of October. With that, we'll talk to you at the end of the next quarter. Thanks, and we're off.

Thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating. You may all disconnect.