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

Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division Scott Gleason - Stephens Inc., Research Division Anton Brenner - Roth Capital Partners, LLC, Research Division Paul R. Knight - Credit Agricole Securities (USA) Inc., Research Division Stephen A. O'Neil - Hilliard Lyons, Research Division Gregory W. Halter - LJR Great Lakes Review Jason Rogers Michael Castor

Welcome to Neogen's Fourth Quarter Fiscal Year 2012 Year End Earnings Results Conference Call. My name is Christine, and I'll be your operator for today's conference. [Operator Instructions] Please note, today's conference is being recorded. I will now turn the call over to Jim Herbert, Chief Executive Officer. You may begin. James L. Herbert: Thank you, Christine, and good morning and welcome to our regular quarterly conference call for investors and analysts. As Christine said, today we'll be reporting to you the results of our fourth quarter, which ended on May 31 and also the full 2012 fiscal year. To start, I'd 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 uncertainties. The actual results, it may differ from those that we discuss here today. The risks that are associated with our business are covered in part in the company's Form 10-K that's filed with the Securities and Exchange Commission, and our new Form 10-K for the 2012 fiscal year will be filed with the SEC and available approximately on July 30. In addition to those of you joining us today by live telephone conference, I'd also welcome those who may be joining by simulcast on the Worldwide Web. These comments, along with some exhibits, will be available on the web for approximately 90 days. Following our prepared comments this morning, we'll entertain questions from participants who are joined via this live telephone 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 announcing the results of the fourth quarter of our 2012 fiscal year. Once again, we reported record numbers. Revenues for the company's fourth quarter were approximately $48.5 million. That's an increase of 11.4% from the previous year's fourth quarter. This brings the total revenues for the company's 2012 fiscal year to approximately $184 million, up from last year's $172.7 million. Net income for the fourth quarter was slightly over $6 million, which is about 1% ahead of last year but the rounding still equals $0.25 a share as compared to the $0.25 last year for the fourth quarter. For the full year, net income was $22.5 million compared to last year's $22.8 million. This equates out to $0.94 per share this year compared to $0.96 last year, when the extra 228,000 outstanding shares are taken into consideration in this year's report. Though the fourth quarter doesn't reflect the full recovery to our normal high-performance model, I think it does show the progress that we told you that would happen, that we told you we expected. We started off in the 2012 fiscal year with a 6% increase in that first quarter that compared to a tremendous first quarter in 2011 that had been up 33%. Revenue generation got a bit tougher when we were only able to show a 2% increase in the second quarter. And at that time, we told you that we understood the problems and were on a program to get the situation righted. At the end of the third quarter, we were back to a 6% increase. At that time, we advised you that we believed that we'd be back to double-digit growth in the quarter ahead, and that's the one that we just finished at over 11%. A bit over a year ago, it became obvious to our management group that all the indicators were positive for strong growth in Food Safety and Animal Safety markets. Even though our compounded growth rate for the previous 5 years had been 19%, we realized that our existing infrastructure would not likely sustain those levels of growth that we've been reporting. The results that we are reporting to you today for the full 2012 fiscal year reflects, I think, the emphasis that we've been placing on creating an operational infrastructure that would allow for the sustainable growth levels that we believe lie ahead. Back in 2008, when our revenues crossed over the $100 million mark, we immediately set our plans to reach the $200 million mark in 5 years. That would be our 2013 fiscal year. We are now in a position to reach that $200 million mark in this year that we've now begun and continue those growth levels on beyond. Though we didn't show the kind of growth this year that we did last year, nevertheless, the growth was solid and the quarter that we just finished marks the 81st quarter out of the past 86 that Neogen has shown revenue increases as compared to the previous year. That growth record now spans 21.5 years. We got a lot accomplished this year that should be putting us in a good position for this year ahead of us. From a fixed asset standpoint, we completed the new warehouse in Wisconsin for our Hacco operations that will allow us to get out of 2 warehouse leases that we had in Wisconsin that were pretty ineffective for our rodenticides and disinfectant business. We acquired a new 128,000 square-foot building in Lexington, Kentucky that has replaced a leased facility for our manufacturing operations there, that had gotten a bit ineffective. We bought a beautiful old 36,000 square-foot manor house in Ayr, Scotland, to give us room for expansion of our Neogen Europe Limited business that handles all of our food safety distributions to -- for our 40 European countries. We already have significant manufacturing warehousing in sales, marketing activities there, so this is just a natural extension. By the way, that business only had about a dozen people when we acquired it 9 years ago and there are over 100 employees this quarter. We bought several pieces of manufacturing equipment last year that are just now beginning to have an impact on cost savings and increasing our manufacturing capacity. One of our biggest investments in the past year was in personnel. During the year, we hired approximately 100 new employees, pushing our total to over 750 now. Our intention is, as I think I've told you in the previous call, was to phase that hiring in over a 12- to 15-month period and hopefully get the early hires to cover the cost of the latter hires. Well, we didn't quite get that job done that way and that wasn't the way it ended up, we had a lot of employees all coming on at one time prior to the time that they really became productive. We also brought on what I believe are some really top managers. They will allow our existing managerial group to be more effective and capture additional market shares. A part of our increased manpower was for our research and development labs in our 5 R&D locations. I think Lon Vest will talk more about the R&D activities here in a few minutes. But as a broad overview, I'm pleased to report to you that not only did we develop some new products during the past year, but we actually established 4 new product platforms that I think are real cutting edge science. In the technology business that we operate, we always try to be cognizant of risk factors, both those where we can exert some control and those where we have no real control. One of these examples is currency conversion. You often hear us talk about wind at our back or wind in our face and most of this year, that wind was in our face. In fact, in the fourth quarter, it was almost at gale force, when currency conversions cost us $680,000 in revenue. However, even with these adverse currency conversions, we were still able to maintain our international revenues at almost $77 million or about 42% of total revenues. Legal expenses for the year that we just finished were about double the prior year. It was legal expenses that we spent in protecting our intellectual properties, such as our patents, our trademarks and our copyrights that had become more important as we expand worldwide. Before I turn the program over to Lon, I frankly didn't really mean to stop on a negative note by talking about currency conversions lawsuits but it is a good time for Lon Bohannon to give you some color behind our operations for the fiscal year 2012 and probably more important, some of his thoughts about the year ahead. But before I turn it over to Lon, I want to make certain to thank our over 750 employees that are scattered around the world for their contributions this year and their role in helping implement the changes that will carry us forward. Lon, let me turn the program over to you. Lon M. Bohannon: Thank you, Jim, and I, too, would like to welcome everyone listening on the conference call, as well as those joining us via the Internet. Jim's already reported on the overall sales and profit performance for our fourth quarter and 2012 fiscal year. Our press release issued earlier today provided additional details related to Neogen's FY '12 results. I intend to cover a few additional highlights for the year, but more importantly, discuss our fourth quarter in more detail since I believe Q4 is more reflective of the future opportunities for the year ahead. Neogen's overall 6.6% sales growth in FY '12 was below management's expectations and it's not reflective of the growth opportunities that exist for our company. There were a number of challenges in FY '12 that impacted sales growth, including negative currency translation, depressed market conditions in the EU, as well as some tough comparisons on a couple of quarters due to unique events that benefited sales in the prior year. With the exception of currency translation, these challenges were most evident during the first 6 months of the fiscal year and particularly in our second quarter, when as Jim indicated, overall revenue growth slowed 2%. However, Neogen experienced a strong recovery in the last 2 quarters of the year, closing out Q4 with organic sales growth of more than 11%. Were it not for the negative currency adjustment Jim described in his comments, our fourth quarter organic revenue growth would have been over 12%. I also think that sales growth improvement over the last 3 quarters of the fiscal year, going from 2% to 6% to more than 11%, is a good indication that the investment we are making in sales and marketing, which Jim also touched upon in his comments, is starting to pay dividends. I believe this is further supported in the fact that our Food Safety group obtained over $1 million of incremental new revenue in the fourth quarter. Approximately 1/2 of this incremental revenue was a result of existing customers purchasing a new product for the first time, and 1/2 of that incremental revenue was a result of obtaining business from 450 new customers. The solid fourth quarter increase was broad-based, as many market segments within our Food Safety and Animal Safety divisions achieved double-digit organic growth. For Food Safety, the growth was also broad-based among many different product lines. For example, sales of our AccuPoint General Sanitation test systems were up 22% in the quarter, while sales of Neogen's proprietary Soleris technology for detection of indicator and spoilage organisms, such as yeast and mold, led to a 20% increase in sales of diagnostics for general micro applications. Sales of tests to detect drug residues, including antibiotics and fluid milk, increased 13% in Q4 and sales of diagnostics for food allergens were up a solid 10%. I think a particular note for Food Safety was that Q4 represented a second consecutive quarter of double-digit growth for our test to detect harmful mycotoxins, led by growth in sales of our recently introduced Q+ quantitative lateral flow test for aflatoxin and DON. There were a couple of Food Safety product lines that lagged in the fourth quarter. Sales of diagnostic chips to detect specific pathogens like Salmonella and Listeria were slightly below last year. Sales for this product line are expected to improve due to the recent launch of Neogen's unique Answer test system that has already received AOAC approval for the detection of Salmonella. Launch of a Listeria test on the Answer platform is expected within the next 30 days. Another problem area for Food Safety in Q4 related to sales of dehydrated culture media primarily to customers in the Pharma industry, dehydrated media sales have been below prior year, each quarter this fiscal year due to lost customers and business that I have discussed in previous conference calls. However, the Q4 sales performance for this product line represented an improvement over the previous quarters and we expect further improvement as we move through the 2013 fiscal year. The report for our Animal Safety division is equally impressive for the fourth quarter. Our GeneSeek genetics testing business continued its revenue resurgence that began in our third quarter, with a substantial increase in sales in Q4. Significant sales for the quarter were realized from processing dairy cow samples coming from New Zealand, as well as sheep samples from Australia. Neogen also added to its capabilities and proprietary position in the genomics area through the fourth quarter acquisition of Merial's Igenity business. We continue to believe the genomics will play an important role in helping address issues that food security have become more critical as a result of a growing world population. Animal Safety's Lexington division closed out a year of exceptional performance, ending FY '12 with organic growth of 17% and Q4 organic growth of 11%. Diagnostic tests to detect drug residues used in forensic applications were up 18% for the quarter while tests to detect drug residues such as ractopamine were also up substantially due in large part to significantly higher sales of kits and reagents going to China. Another product line achieving strong double-digit sales growth for the year was veterinary instruments, led by an 18% year-over-year increase in sales of Neogen's proprietary D3 Detectable Needle. Animal care products such as Neogen's Kare line of small animal supplements and vitamin injectables achieved solid growth in Q4, and were up 24% and 31% respectively for the year. Also noteworthy were sales of high-margin biologics, including our unique BotVax B vaccine used to prevent type B botulism in horses, which increased 26% in the quarter and was up 16% for the year. Partially offsetting the outstanding Q4 results in our GeneSeek and Lexington groups was a 15% decline in revenues at our Hacco operations. Last year's fourth quarter experienced significant inventory stocking orders from rodenticide customers, in advance of the EPA's new risk mitigation rule that went into effect just a couple of days after the end of last year's fourth quarter. The new rule primarily impacts packaging in the type of rodenticides that can be marketed to retail consumers. Neogen has rodenticides that comply with the new EPA rule and is focusing on new packaging configurations for the retail farm store market. In addition, since rodents represent a significant food safety problem inside the farm gate, we continue to develop new bait formulations to capture a greater share of market with animal protein producers who must use rodenticides to control rodent infestations and outbreaks within their facilities. Before I leave revenue growth, let me briefly comment on our international sales. We ended the year with international sales representing 42.6% of our Q4 total revenues, which brought us up to 41.7% of FY '12 total revenues. Our Neogen Europe operations had an exceptional fourth quarter, with overall revenue growth of 24%, led by sales increases in many of the product categories described earlier. Neogen Europe actually ended the year with double-digit organic growth, which is pretty remarkable considering the economic turmoil that persisted throughout the year in the EU. Our Neogen LA and Neogen do Brazil operations also achieved excellent growth in FY '12, with significant increases in sales, although frankly in fairness, these 2 operations are still very much in their infancy in terms of total revenues. One other comment I would make regarding international sales is related to China. We now have our own employee in China working for a Neogen-owned subsidiary that was established shortly after the end of our 2012 fiscal year. Initially, this person will work closely with existing distributors to build Neogen's brand and presence in China's growing Food and Animal Safety markets. In FY '12, total sales to China exceeded $2.6 million, with much of the growth occurring in sales of drug residue tests and Soleris systems used to detect spoilage organisms. Inroads are also being made in the areas of plant disease diagnostics and General Sanitation testing. Well, switching gears, I do want to say I'm particularly proud of our employees working in operations, who in FY '12, did an excellent job of managing costs at the gross margin level. For the year, gross margins were just 60 basis points less than last year and this decline is primarily due to a change in product mix between rodenticides and disinfectant sales. Employee teams focused on cost reductions were able to achieve a 24% reduction in Food Safety scrap expense for the year and helped the company realize almost $500,000 in net raw material cost savings during FY '12. Other initiatives resulted in labor savings, lower shipping expense and increases in manufacturing productivity. Of course, all of these cost savings programs were needed, because as Jim discussed earlier, management had determined prior to the start of FY '12, we needed to expand our staffing levels, particularly in sales and marketing, to put in place an organization that will carry us beyond $200 million in annual sales. As we look ahead to our 2013 fiscal year, we know we are serving markets that continue to grow, both domestically and internationally. We are also now benefiting from a growing portfolio of new products that are being introduced to the market. Since March 1, Neogen has launched 8 new products to the market. Included in the new product releases are 2 new mycotoxin products, 3 new food allergen tests, 2 new Soleris assays for sterility testing in aseptic processing and of course, our new Answer Salmonella tests. More new products are scheduled for release as we move through the 2013 fiscal year for both -- for Food Safety and Animal Safety divisions. We also have a much larger, more experienced and better trained sales and marketing team to sell these new products and take full advantage of the significant opportunities we believe exist for our company. Management expects to see the completion of our stated 5-year goal to achieve $200 million in annual sales in our 2013 fiscal year and intends to build on that important milestone to achieve success for greater growth in sales and profitability in the years to come. At this point, I'd like to turn the call back to Jim for his closing remarks. James L. Herbert: Well, thanks, Lon, and I think you can see that there's certainly no lack of optimism in our future when you hear Lon lay out the plans. In my opening comments, I did not make any mention of acquisitions during the prior year since they had very little impact. However, during the year, we've made a nice small acquisition in Scotland to add to our laboratory services group there in Ayr. Our big -- The big contribution of that acquisition are really coming in the years ahead. One concern worldwide and today in the food industry is being able to provide ample seafood from both wild harvest, as well as aquaculture. The laboratory business that we purchased in Scotland was solely devoted to testing seafood. This is providing us a good base as we develop rapid diagnostic tests to detect the most important shellfish toxins. I expect us to have at least 3 good rapid diagnostic tests coming from the Scotland research unit sometime during this coming year. I also didn't talk much about or talk at all, in fact, about the acquisition Igenity. Lon mentioned that. This is acquired -- an animal genomics business that we acquired from Merial in May, right at the end of the year. This business is a great bolt-on to our GeneSeek genomic business located in Lincoln, Nebraska. I believe that Igenity is likely the world's leader in supplying genetic information for breeding improvement of beef cattle. This now puts Neogen with what we already had in the place of being the undisputed world leader in beef cattle genomics. In addition to providing important selection traits to commercial cattle producers and feed lot operators, we also are doing work with more than a dozen of the different beef cattle breed organizations, including the largest 5. For those of you that are familiar somewhat with cattle breeds, you all recognize the names of Angus, Hereford, Simmental, Limousin and Charolais. As I think I reported to you in an earlier conference call this year, we've been able to take the genomic capabilities in Lincoln and utilize those not only in animal breeding such as beef, dairy, sheep and pigs, but also to utilize those in diagnostics and the determination of harmful food pathogens. Within the next few weeks, we'll be launching our NeoSEEK program to more precisely identify harmful microorganisms in food. This will be one of those 20 new product launches that we expect during the year. Lon gave you a little bit of better color on several of those already. Of course, we can't always manage around the risks that we can't control. However, awareness of those areas is important, I think, to the growth of our company. Weather is an example. Record-high temperatures across major grain-producing states, coupled with drought, still leave the U.S. corn and soybean crop in question. Will this give rise to some of the important mycotoxins where we provide tests? This of course, is still unknown. All of this is also driving up the cost of animal production. Cold wet weather in parts of Europe and the United Kingdom have introduced yet indeterminate other risks in the food industry. Now part of Neogen's distinct advantage is that we offer many Food and Animal Safety solutions. As an example, Mexico is now fighting a problem with avian influenza that's killed millions of chickens and may, in fact, require extermination of many more in order to prevent the spread of this disease. While this is bad for the meat and egg side of our business, we do supply the strongest available disinfectant in the market to clean up contaminated farms. The winds of currency conversion are not predictable to us at this point and what they may look like out over the next 12 months. However, in certain high-risk situations where we sell product in currencies other than the U.S. dollar, we do hedge some of those receivables. Furthermore, as Lon pointed out in his comments, as we continue to be the lowest-cost producer of the products that provide most of our revenues, we can and are protecting the bottom line with our continued investment in higher efficiencies. We'll continue to look at for those synergistic acquisitions, and I've got a feeling that things might get a little looser here in the next 6 months, particularly for some of those businesses where taxes may be a major driving force. Our current view of taxes, based on capital gains and what's going to happen apparently to Medicare, is that Washington will get 10% more of the seller's profits after January 1. Our balance sheet is, of course, strong and we continue to generate positive cash flow. The 16% increase in shareholders' equity during the past year and that strong balance sheet should hold out for any borrowings that we might need to do, to do even bigger deals. In closing, I want to make sure to make you aware that -- of our annual open house and picnic for shareholders, it takes place on Thursday afternoon of this week at the company's headquarters here at Lansing. If it's convenient, talk to Terry Maynard about the details and we'd like to have you join us. In closing, let me once again say thanks to all of our shareholders and analysts who've been such strong supporters of the company during the past year. And also particularly to our employees, who along with me, realize that the toughest thing about success is you have to keep on being a success. This concludes our prepared comments for today and we'll now turn over the telephone call for any questions from participants.

[Operator Instructions] The first question comes from Steven Crowley from Craig-Hallum Capital. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: One of the things you mentioned, maybe I'll start with a numbers question and ask a couple on new products and then hop on the queue, but the FX numbers that you just shared with us in the prepared commentary, the $680,000, just to be clear, was the revenue impact in Q4 and the $413,000 that you referenced as a currency loss in the press release was the operating income impact? So my question is, is that the case? And what were those respective numbers for the year? Steven J. Quinlan: For the year, Steve, the operating income number was $531,000 loss. The revenue number was $58,000 reduction in revenue for the full year. So you see, we really got hit in the fourth quarter. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: And then there was the $680,000 hit in the fourth quarter to the revenue line? Lon M. Bohannon: Correct. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: Okay, that's helpful. I just want to get a clearer picture of what was happening under the hood. And then on the new product front. In your prepared commentary, you mentioned both Q+ and Answer in a constructive light. Can you give us a sense for the customer acceptance of those products and the prospects as we move forward here? Lon M. Bohannon: Steve, Q+, we actually released the first quantitative lateral flow for aflatoxin going back to last fall and then follow that up with DONs, zearalenone and I think we've got humas [ph] and out now and the acceptance of those tests have been very, very good. I don't even know how many customers we've totally have sold since releasing that first product. But I know we've got significant amounts of dollars in the FY '13 budget and we had good growth in sales of those products actually in fiscal year '12. I mentioned, if you recall, that we're now in both the third quarter and the fourth quarter, we had double-digit organic growth in the area of mycotoxins. And I certainly attribute a good deal of that to the fact that we had these new quantitative Q+ products out there and they are gaining market share for us, in both the EU, as well as domestically. In terms of Answer, that's really -- we have -- we're very excited about that product line. That's -- it's a platform. We're looking forward to the Listeria test. The Answer platform and the Salmonella test that already has AOAC approval has been well received. We've already got 6 placements of that instrument. We've got 50 active accounts in the pipeline right now that are looking at it. And so it's going every bit as well as we expected in terms of the initial launch. It's still very new and when you're talking about running the kinds of companies who are looking at this, they're all going to do in-house validations over a period of months to determine the quality of that product. So -- but it's meeting all of our expectations at this point. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: And with Q+, the kind of peak usage period for those naturally occurring toxins and grain would be what, starting maybe a month from now or 6 weeks? Or what's kind of the peak customary timeframe for utilization? James L. Herbert: Those, Steve, would generally be in the second quarter when we start to see crop come from the field. That's -- the OND time period is when we seeing most of the grain begin to come out. The extreme south in Texas, we'll start to see a little bit of stuff coming out next month, but that's not going to be -- it's probably all that -- it's never in the past been all that big. So it's a -- but the cue for that, that's sort of the beginning of the season. But remember, when grain comes out of the field, it changes, moves several times before it's finally consumed. So its first point of recede is it leaves a field and goes to an elevator somewhere in the country. And then the next time, when it comes out of that elevator and goes to either another elevator or goes to on a barge to go down the river to go up to be exported or it goes into actual consumption, could be tested -- the same grain could be tested 3 or 4 times in its life. Most of that, however, does occur in our second and third quarters.

The next question comes from Scott Gleason from Stephens Incorporated. Scott Gleason - Stephens Inc., Research Division: I guess, Jim, if we could just dwell a bit more on your comments like kind on the drought and looking at the upcoming harvest season for the mycotoxin test kits. And certainly, those have been pretty important products for you guys. When we think about I guess the second half of this calendar year, how do we kind of balance that aspect with some of the new quantifiable test kit sales? Can you give us a little bit more sense for how you guys are thinking about that trajectory? James L. Herbert: Yes, it's a -- I think I really don't know what the situation is going to be in Europe. I was over there 2 weeks ago and it rained every day and was 10 degrees cooler than normal. It's going to impact and is impacting, I think, their small grains over there, their barley and their wheat crop, which is likely going to continue to be problems with DON and some others. The yields probably look okay over there. I think the problem that we're facing here, Scott, is what we're going to do as far as yield are concerned. July, having been around this business for more years than I care to remember, July is always a rumor month. The first rumor is it's going to be a great crop because it rained yesterday and then the next rumor is going to be a terrible crop because it didn't rain for all Friday and those rumors abound. I do think that it's probably a little more concern than we might normally think of. We've had 4 times in the last 20 years when I look back that we had sharply declining crop conditions at this time of the year. At the last time, as we look back with men and back in 2005, I think they suggest that first of all, in order to be able to test for mycotoxin, we're going to have an ear of corn. And some of those places, it looks so bad that there may not be any ears formed. But It's a little early to tell. Yes, I think it's going to get to be a disaster if we don't get some rain here in the next couple of weeks. But I don't think that it's though the commodities market is talking about a disaster right now. I'm not sure we're ready to call it a disaster. I do think that there's going to be some spotty issues because -- and that works well for us. If the whole world has got the same or the whole state of Iowa is an example, has bad mycotoxin corn, then the whole state of Iowa has a tendency not to test because they all know it's going to be bad. However, if it's from one county to the next, then there's a lot more reason to test. So I think we're probably looking at some spotty weather conditions out there, which may mean that we'll have some bad crops in some places. In other places, we'll have good crops. So I think if I were predicting right now and trying to tell our people what kind of diagnostic test to get prepared to start to push out in September, October, I think there's going to be some opportunity for us, particularly in aflatoxin and corn. This is going to impact and is impacting what's happening in animal production costs. There's already been a cry to go out to get the government to resend ethanol needs. That's not apt to happen to try to keep corn flowing into the food supply rather than into fuel. That's a political hot spot. I don't see anything changing there. We are seeing -- our beef herd is not because of the weather that we're seeing now but because of the weather last year in a few other places. The cowherd is the smallest that it's been, if you look back in the last 25 years. So we don't have as many mama cows out there that are going to be giving, putting feeder calfs into the market this fall. That's going to be healthy, I think, for the cattle business. But by the same token, it's going to put a pinch on probably what beef is going to bring in the meat counter. The poultry business we know was hit pretty hard. I know several of you are acting as analysts on some of the publicly held poultry companies, Pilgrim's, Tyson, Sanderson. I think they've all been downgraded as far as earnings this year because of what's happened or this week or downgraded because of the drought. We know that there were millions of chickens lost across, even the central part of the country, Ohio, Kentucky, Tennessee, both in the link flock, as well as in the broader flock and part of that broader flock is our hatchery supply flock that's producing hatching eggs to produce the day-old baby chicks that are going to make chicken meat going forward. So there's some uncertainties there not only because of beef price but because of the effect. When you look at all of that, we're cognizant of it. We try to make sure that we're there to help our customers where we can. But when we have products on both sides, it's kind of comforting. I talked about the problem that our friends have in Mexico today with avian influenza. But -- so they're not testing as much beef going into those flocks of chickens that are now dead, but by the same token, as they clean up down there and they're decontaminating, we have the single best disinfectant in that marketplace and is considered as such to use for clean up. So there's just a lot of moving parts right now. But that's kind of not -- you've been around this market for a while. That's not atypical for July. Scott Gleason - Stephens Inc., Research Division: Okay, great. And I guess when we look at the Igenity deal in the quarter, it says it closed in May. Is the right way to think about that -- that, that was about a $300,000 contribution or more like about the $6 million or so that you guys did through the DNA testing segment? And I guess when we think about FY '13, it's the right way to think about that, kind of $4 million to $5 million in total revenue contribution? James L. Herbert: Yes, I think I don't remember what our exact budget number is. I think we've got it in the budget now. Remember that a part of that business is add on. We were doing all of the genomic testing for Merial. The samples were coming to us. We were doing the lab testing, providing the raw data back to Merial and then they were running it through their bioinformatics models and then telling those results back to their customer. We've kind of got both ends of the rope now. So we'll continue to have the testing revenue that we had before but we'll also be able to capture the additional gross margins by being able to have our own -- have the bioinformatics that we can carry through to the customers. So I think you have to look at it in 2 ways. What's the total expected revenue from Igenity and then what's the expected revenue and earnings over and above what we had in the prior year. I ought to have those numbers in my head because I've looked at them but we could give it to you at a later point. But I'm afraid to quote them now. Scott Gleason - Stephens Inc., Research Division: Okay, great. And then just last question for Jim and Lon. When we look at the growth for FY '13, obviously it seems like this year, you guys are expecting a larger contributions from new products. Can you maybe give us a sense of maybe what's the magnitude of total growth for next year could it be from a new product contribution? And then also, I guess, obviously people are always wondering about acquisitions. Can you maybe give us a sense for kind of what the current pipeline looks like in terms of potential candidates that are out there and maybe how to think about that a little bit in terms of our models for FY '13? James L. Herbert: I think, Lon, you're correct me if your memory's better than mine. We looked at those new products that were going to be introduced this year and sort of did a Ouija board on them, predicting which ones. I think we talked about 20, in my conservatism, I've said I think 17 of them will make it. We may not get there with all the 20 by the end of the year, but -- and the Ouija board, we've tried to pick out how many of those would be $1 million plus in contribution and on down to less than $1 million, put them in about 4 different buckets. As I remember, that number was somewhere in the range of $7 million coming out of those. But again, I'm working from memory. And if that's important to you, Steve can give you a better information when he's got some as some old boys say, "with aid of paper and pencil," he can tell you more. But that's about what I remember. Lon M. Bohannon: Scott, this is Lon. Jim's correct. In terms of as is usually is, in terms of his memory. As far as what we're looking at, we have been saying that we think starting really in that May period that we thought we could get like 20 products out in the next 12 months, the opportunity is to even get more than that in the year when you include everything in Animal Safety and Food Safety combined. But I think the opportunity to get another 15 out this year or so based, compared to what we've already gotten out is reasonable. And we do have a number of those products that we'd certainly expect to be $1 million plus kinds of opportunities. It will kind of depend on when they get released. Obviously, things like Answer Salmonella and Listeria, they're going to be released earlier in the year, are going to have an opportunity to generate those kinds of numbers. Whereas some of the products that maybe $1 million opportunities but don't get released until March, of -- in the fourth quarter of fiscal year 2013, won't generate as much in this fiscal year but certainly on a go-forward basis, will be above that $1 million opportunity on a full year kind of basis. So we can look -- we don't really budget just specifically at that way for new products because we sum -- we're market-oriented. And so we're looking at customers and markets. But we can certainly add that up for you and get that if you want to see that. Scott Gleason - Stephens Inc., Research Division: Okay, great. And then do you guys have any commentary on the acquisition pipeline? James L. Herbert: Yes. Yes, there's a -- we've got 3 in the pipeline at this point, no letters of intent on any of the 3. None of them really big, none of them that would unfortunately strap Mr. Quinlan's cash account this morning. But we are looking at some things that do look interesting. And I think, particularly where you have tight ownership, a very controlled ownership, the comments I've made in my prepared remarks, is I think we don't -- I don't think any of us know what the tax situation is going to be next year but I think we probably all agree it's going to be higher than what it is this year. And if we can see a change in whatever capital gains is going to be -- and whatever add on we're going to get from Medicare, it's going to mean that if you plan to sell your business, you ought to do it before December 31. And I think there are some people who are beginning to look around. We've got one that's on our target right now that would fit into that category. But nothing if we've a letter of intent on. We're active there. We've got a new member of our corporate development group who's a bright young guy, who's much like Jason Lily He's a PhD, in his case, Chemist, who also is a MBA from Maize and Blue kind of a school down the road from us, who's pretty bright, and we've got him at work on looking at some things, not just domestically but also internationally.

The next question comes from Tony Brenner from Roth Capital Partners. Anton Brenner - Roth Capital Partners, LLC, Research Division: I have 3 questions, if I could. Jim, you mentioned that Neogen has 4 new product platforms developed this year. Could you identify those and maybe comment on whether those are a significant piece of that projected $7 million or so in revenue contribution? James L. Herbert: Well, one of those is the isothermic platform that Lon talked about with Answer. We'll put several products on that platform. The first one out is our product for Salmonella. It's no secret that the next one coming is our product for Listeria that looks equally good. It's -- of those of you who are familiar with that side of the science, it's even faster because it detects RNA rather than DNA. So you can get there with a lot more copies, so you get there a lot faster. That one is in beta sites this week. I would expect, with any luck, we'll have that one out by the end of the month. I hoped I'd get it on my birthday, which was the 3rd of July but they didn't quite make that. Right behind that is what we're doing with STECs. That's the whole issue on hemorrhagic E. Coli. That's a big development that everybody, including the major meat packers and our close friends are all trying to wait for the next you to follow there. This is, if you remember, the FSIS USDA came out and said that it is not just E. coli 157:H7, it's a problem but we're also going to declare her 6 ugly sisters as adulterants if they're in food and nobody knew exactly how many of those there were going to be. There are some results back now that are showing that may be as much as 5% are going to be contaminated with one of those. So that will be also on that, Tony, on that isothermic program, both to detect the hemorrhagic portion, as well as to be able to detect the 6 servars that are of biggest importance. Campylobacter is another one that will get added to that because of the problems that we see in poultry. So I think you can see that platform, we'll put several products on. And then one of the other platforms was our quantitative test in a lateral flow device that frankly, is pretty well-developed now. It was 1 of the 4 that we developed during the past year. That's the Q+ line that Lon talked about with aflatoxin and being the first one out. We've still got a couple of those products that are not yet being introduced to the market but will be here, hopefully both of them in this fall timeframe. And then the third one is what we've done with our Soleris product line. We've made some changes in one of the vials there, which has made it possible for us to have a one step. Remember, the Soleris product line is the one that we acquired from Eastman Chemical Company back in '06. We've continued to grow that business. Lon Bohannon would tell you that it's probably the best growth opportunity of any product line in the company and he may be right. We've continued to grow that business, one of the -- and make these things faster. These are just little individual vials that go into a reader and it comes on and reads the vial on regular intervals throughout our 24-hour period. It tells you when the growth occurs. When growth occurs, it tells you that there was an organism that was present in that sample. We were able to get, move away from what we had. We had a double vial system. It was the only way we could handle some yeasts and molds on products like that. We've developed, or during the year, developed a silicon method to get away from the double vial, added on or probably $250,000 to our manufacturing equipment to be able to accommodate that. And look, that has been an important platform for -- and we're putting some new products on that platform. We still have a few more to put on there. So those are the kind of defines the overall platform. Anton Brenner - Roth Capital Partners, LLC, Research Division: Okay. Second question, regarding Europe, which earlier in the year had been a real problem for you. I know you addressed many of the credit issues earlier but certainly, the economy remains depressed in most European markets, yet in the fourth quarter, you reported I think you said a 24% revenue increase. So I'm wondering if that's just the debt cap bounce in that market or it's against easy comparisons we can see 20% plus gains in fiscal 2013 in Europe? Lon M. Bohannon: If you can tell me what the bond rate's going to be in Greece and/or whether Italy is going to be able to honor its debt and what's going to happen in Portugal, I can give you the answer to your 2013 question. Seriously, I think we've obviously gained some strength in the United Kingdom. Our U.K. business where -- has been not hit by the bigger T's of the financial situation near so bad. As we've grown that market, and that's helped cover up some of the problems in some of those other 40 countries that we talked about. Our French business is where we've got our own people on the ground, is strong and growing. Our German business is strong and growing, so I just picked off the 3 top economies over there. We're still having a bit of difficulty in Greece, just because we are concerned about being paid. We know that there are still problems in Spain, Portugal, Italy. They seem to be improving a little bit. Maybe the economy's not improving so much as the apprehension within the marketplace, within the customer base. They've decided that life is not going to come to an end and they got to keep moving forward. I think that's helped us a little bit. I don't -- I can't, as I said, I don't know what to tell you, but I don't know what to tell myself about what that situation may look like 3 months, 6 months from now. Of course, the dollar's gotten stronger, which is not particularly in our favor, and a stronger dollar growing into a weaker economy is not particularly helpful. But I think we're doing some things to help our distributors in some of those other countries. We started doing that back in January and it's paid dividends as we moved into that fourth quarter that Lon talked about. Anton Brenner - Roth Capital Partners, LLC, Research Division: Is that point accounted for the big increase? James L. Herbert: I missed the question. Anton Brenner - Roth Capital Partners, LLC, Research Division: Is -- that's a major factor in that big fourth quarter sales increase in Europe? James L. Herbert: Yes, it's probably -- there were several things that went in that add up to it. But, yes, I think some of the things that we had established for our distributors back in January in those countries, I talked about 2 countries being strong where we have our own sales people. And the rest of those countries, we work through independent distributors to establish some programs to help them regain some business. And I think that probably showed up. It was a strong cause for the fourth quarter increase. Lon M. Bohannon: Yes, Tony, this is Lon. To add to that, that was one of the areas where we did make an investment in sales and marketing this year and I think what we saw is similar, and to a greater extent, we saw even domestically. In that operation, we saw them pick up strength as we went through the year, and particularly in those countries where we had a direct presence and had our own people and added to the staff and got better trained personnel on the ground. I think that what did contribute and drive up the revenues percentage-wise in the fourth quarter was an improvement in that portion of the business that runs through distributors, and I think for all the reasons that Jim commented on. And that's still the area that we have to work with very closely going forward to continue to see overall growth double-digit growth in Neogen Europe in the next year. Anton Brenner - Roth Capital Partners, LLC, Research Division: Well, certainly, that business was especially weak in the first half of last year, so you've still got some easy comparisons I would think? James L. Herbert: Yes, yes, you're right. Anton Brenner - Roth Capital Partners, LLC, Research Division: Okay, last question. What's going on with FDA regulations on imported products? James L. Herbert: Very little. It's -- they are beginning to tighten up on certain products. I say I guess I got the word last week that I'd forgotten which of the seafood species they're now testing 100% of what's coming in through the FSMA Act. They -- well, I guess I'd say that there's still very little happening. It's -- the regulations are there. The money is budgeted, and yet the procedures are not all still -- we're still waiting for the procedures to be written up. So it's a political year and I guess that's the best explanation I have.

The next question comes from Brian Kip [ph] from CLSA. Paul R. Knight - Credit Agricole Securities (USA) Inc., Research Division: It's Paul Knight. My question was regarding the DNA's business, though. Can you talk about, I know you made an acquisition there or changed your partnership. Can you talk about what's happening in the sequencing service business? James L. Herbert: Yes, that I guess I can address that from 3 avenues. One is though it's probably the youngest and easiest, is it I made mention in the prepared comments that we've now done the sequencing or now done the genomics work based on the sequencing. The harmful pathogens, that's an area that was not involved at all in genomics at the time -- in our genomics base at the time we acquired that business. It's helped us help some of our most important customers, the major beef packers is an example. I'm trying to figure out how to deal with some of the pathogens that they've got. That's providing us some Service business. But probably more importantly is providing An avenue for the better development of rapid tests. And we see that is important going forward. We had all that group together last Friday and it was really encouraging to see the new things that when you looked at the microbiologists and the genetics guys sitting together as to how much stuff that they could dream up, they could get started right away. The second piece of that is our traditional GeneSeek business in which when we acquired that business, it was the strongest laboratory in doing actual laboratory genomics work for the animal industry. They, in almost all cases, where they're simply running the genomics and providing the raw data back to a customer, who was in turn, making interpretations of that. We'll continue to do that. It's a strong part of our business and we'll continue to do that. And it's covering all species. We just got a contract this past week for catfish to do work on catfish genomics through our group and as you expect in the southern U.S., we also got a nice contract from a Chinese publicly owned, state-owned industry to do genomics on the Asian carp. So a little bit outside of the pig and cattle business but we continue to do those kind of genomic businesses in which we'll do the hard and the heavy lifting and supply that data back over to somebody else, who will do the final interpretation. However, the third piece and the one that gets me most excited is where we are with the genomics, where we can in the bioinformatics to match up to that. We said when we bought the business that, that was one of the things that we wanted to do. And we're off to a good start in doing that. We said we wanted to get a lot of that accomplished by the end of the third year and we're in the third year. So what we're doing there with our Igenity program in beef cattle, we'll be doing in other commercial programs that I just assume not talk about today since I suspect that the one strongest competitor we have probably listens to this call.

The next question comes from Steve O'Neil from Hilliard Lyons. Stephen A. O'Neil - Hilliard Lyons, Research Division: I think you've covered just about everything. About the only thing that gets kind of lost on all of the other new products is the, I guess, I'd say has got the dairy antibiotics to see if anything was happening there or if there was anything of note in that business? Lon M. Bohannon: Well, it's -- it continues to be a very important product line for Neogen in total and stuff. We had a nice growth in the quarter as it relates to dairy antibiotic business, which was overall growth of 10%. I think -- I mean frankly, I mean our penetration of the U.S. market with the beta start test has been disappointing up to this point. And we're taking a look. One of the reasons we put in and developed, started a marketing group this year was to help us understand a better way to position that product for this important market. Now having said that, we are having good success with that product in Brazil, so it's not like we're not having success with a new BetaStar Plus product. In fact, I just got an e-mail last night or night before last from one of our principals in Brazil who was -- had pictures of the trade show they're at right now where we have had success in converting customers over and capturing market share with that product. So we've got to take some of the stuff running down there actually and apply it to what we've got here in the U.S. and maybe reposition that product in a way to capture more business here. But overall, the product line is doing well and some of those new products that we're talking about releasing are going to be to help supplement that line in terms of testing for that important dairy market.

The next question comes from Greg Halter from Great Lakes Review. Gregory W. Halter - LJR Great Lakes Review: A couple of numbers questions. I wondered if you could provide the capital spending for the year fiscal '12 and what your expectations are for '13? Lon M. Bohannon: CapEx for the year is about $12.4 million. And remember that, that included the purchase of our Lexington facility, which was about a $5 million spend. So fiscal '13 will go down probably in the $7 million range, $2 million to $7 million range, I'm sorry. Gregory W. Halter - LJR Great Lakes Review: Okay. And also regarding the depreciation and amortization, what's that figure was for '12 and what you expect for '13? Lon M. Bohannon: It was $6.2 million for the full year '12 and it will probably ratchet up to about $6.4 million in '13. Gregory W. Halter - LJR Great Lakes Review: And I don't know if I -- if this was provided or not, or maybe I missed it, but the annual figure for cash flow from operations? Lon M. Bohannon: It was $22.3 million, which included a strong $9.1 million on the fourth quarter.

Okay, great. And finally, I know you provide this in the Q, or I guess it will be the K, but do you have any operating and income figures by segment, by the 2 segments? Lon M. Bohannon: Let's see. Okay, for Animal Safety, it's $12 million basically, $12,039,000 and for Food Safety, it's about $23.4 million. I'm sorry, $23.9 million.

The next question comes from Joseph Faddin [ph] from Wells Fargo.

Just a quick one, cash flow per share? Lon M. Bohannon: Cash flow from operations per share was about $0.93.

$0.93? Okay. I came up with $1.19. Lon M. Bohannon: I was giving you from pure -- purely from operations. So if you want the cash increase year-over-year, your $1.19 is going to be much closer.

Okay. Yes, that's what I care about. You pay bills in cash, right Jim? James L. Herbert: That's right.

Your next question comes from Michael Castor from Sio Capital.

A couple of small ones. First, I didn't catch it earlier. There was a question about how much you expect the Igenity acquisition to add in 2013. Could you repeat that? Lon M. Bohannon: I think again, I'd have to go back because it's kind of a convoluted question because of business that was already there, but somewhere in the range of $4 million.

Second one is, actually looking at this question that was just asked on cash flow per share, I'm looking at the balance sheet. You got $69 million in cash roughly at the end of the year now versus $56 million at the end of fiscal year from last year. So the increase of about $13 million is roughly $0.50 a share. Am I missing something? Lon M. Bohannon: Well, what I was trying to give was the cash flow from operations. And then from that, we're spending -- we spend about $12 million in property, plant and equipment. So it kind of depends on exactly how you want to measure that number.

Okay. I can understand the logic. I just wanted to clarify just because it came up in the last question. Then the other one I had was, what's your expectation, Jim, for the operating margins for next year? James L. Herbert: Well, we don't normally give advice. But our goal is always to run at 20%. We -- and I'm not sure how close to that 20% we'll get. We should get in there pretty close to it based on what I'm looking at right now. It's just sort of been a guide for us. We violated that a little bit a couple of years ago and we let that run up to 22.5% or so and we should have been taking some of that money and putting it back into expansion opportunities. So we watch it pretty close. 20% is our bogey.

So this year, coming in at 18.4%, 18.5% roughly with the gross margins being a little bit under pressure, you think that will reverse next year? James L. Herbert: Yes, yes, yes. But I don't know how much a reversal but I think we'll put a greater percent to the operating plan than we did.

And finally on that topic, R&D as percentage of sales, it was running last 3 years for 4.4, then 4.0, then 3.6, although in absolute terms, it's about stable. Is the current level of 3.6 or so enough to keep growing the business? James L. Herbert: No, and we'll spend more next year. And it's not always -- it's where you spend the dollars and the quality of the dollars. I think the quality that we were able to produce from the dollars this year speaks very well for the scientists in the professional group. They got a lot more done with less money than they have in some years in the past. And there's a lot there that is unpredictable. How fast we can make breakthroughs or what areas where we're building on platforms that aren't in existence, new product development becomes cheaper than if you're trying to invent a new platform. And occasionally, we'll get one that we'll just work on forever and finally abandon it and that money just gets lost. So -- but we'll spend more dollars in actual dollars this year.

Okay. Also, what's your expectation for tax rate for next year? This year came in around 33.6%, which was about 150, 200 basis points less than prior years? Lon M. Bohannon: Yes, I think it's probably fair to look at about a 35% to 35.5% effective rate. The 33.7% for this year is actually lower than what we would normally expect because we were under audit this year with the IRS for the 2010 and 2009 fiscal year. That came back, was clean, no adjustment and we took -- we reversed some reserves that we had set up in prior years because we're now clean. So we reversed some of those reserves in the fourth quarter, resulting in an effective rate for the fourth quarter of about 28% and for the year, a 33.7%.

The next question is a follow-up from Steven Crowley from Craig-Hallum Capital. Steven F. Crowley - Craig-Hallum Capital Group LLC, Research Division: The reward is I'll keep it short and sweet and just ask one since we've gone on a while here. You mentioned roughly 20 new products over this 12-month period we're in. Could you just give us some perspective, historical perspective on what you've typically done in a fiscal year or in prior 12-month periods just so we have a reference point? James L. Herbert: Well, Lon and I'd say this is probably the threefold what we would do in the normal -- in the last 3 or 4 years? Lon M. Bohannon: Yes, I would say, and that's key point I think. In the last couple of years, I think we've been in that 6 to 8 range a year. And so this does represent a -- that pipeline getting filled up and now starting to result in new products being launched that can help drive that organic growth going forward. So it is a definite improvement, particularly over the last 2 or 3 years in terms of new product releases we've had. James L. Herbert: And some of the new products that we've put out tend to cannibalize older products as we're coming out with newer, better, faster ways of doing things, too.

That concludes the question-and-answer session for today. Please go ahead with any final remarks. James L. Herbert: Well, thanks again for your interest in following the company over the past fiscal year. And we're excited, we're starting the new year now and almost 2 months into it, those of you who are in a position to be -- to join us on Thursday for the open house and picnic, we'd love to have you. And otherwise, we look forward to talking to you again on this call at the end of the first quarter. Have a good day.

Thank you for participating in Neogen's fourth quarter fiscal year 2012 year end earnings results conference call. This concludes the conference for today. You may all disconnect at this time.