Good afternoon, ladies and gentlemen, and welcome to the Bio-Rad Laboratories First Quarter 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, this conference call is being recorded. I would now like to turn the conference over to your host, Ms. Tsingos, Executive Vice President and Chief Financial Officer.

Thank you, Paige. Good afternoon and thank you for joining us. With me today are Norman Schwartz, our CEO; Annette Tumolo, President of our Life Science Group; and John Hertia, President of our Clinical Diagnostics Group. Today, we will review our results on a GAAP basis and then provide some commentary and insight to our results on a non-GAAP basis. Before we begin the review, I'd like to caution everyone that we will be making forward-looking statements about management's goals, plans, and expectations, our future financial performance, and other matters. Because our actual results may differ materially from these plans and expectations, you should not place undue reliance on these forward-looking statements. And I encourage you to review our filings with the SEC, where we discuss in detail the risk factors in our business. The company does not intend to update any forward -looking statements made during the call today. So let's move to the first quarter financial results. Net sales for the first quarter of 2018 were $551.5 million and impressive growth of 10.3% versus the same period last year sales of $500.1 million. On a currency neutral basis, sales increased 4.5%. In addition to strong product sales around the world, the first quarter sales result also include approximately $6 million of recorded sales associated with the settlement of a royalty dispute in our Diagnostics segment as well as $6 million of RainDance sales which compares to $2 million of sales last year. When comparing the first quarter of last year remember that an estimated $9 million of revenue was pulled forward in anticipation of the go-live of our European deployment of SAP in April 2017. If we exclude both the acquired and royalty settlement sales from the first quarter of this year as well as neutralize for last…

Your first question is from the line of Brandon Couillard with Jefferies.

Thanks. Good afternoon.

Hey, Brandon.

Christine, two part question for you on gross margins. Any chance you could split out the effect of that pull-forward in the first quarter of last year that made the comp tougher? And then secondly, what would your gross margin outlook be on a non-GAAP basis for the year?

So in terms of kind of recasting last year without the pull-forward, we haven't done that specific math but on average our consumables certainly carry a higher than the consolidated gross margin of the company and what we had our customers who are on standing orders to do is pull forward those consumables. So, the short answer is Brandon, we didn't make that specific calculation, but in general the consumables carry margins that that can be 60% or better, so that was part of it. And then your second question?

If you could recast the gross margin guidance for the year on a non-GAAP basis?

Sure. So we were talking about operating margin going from 10% to 11% and some of that is gross margin improvement but also operating margin improvement. And on the gross margin the 55.5% to 56% probably is now 56% to 56.5% if you will and then the balance of that improvement getting to a target of 11.5% is found on the operating line.

Thanks. That's helpful. And then as we look at the balance of the year, can you help us think through how you anticipate the cadence of year-over-year margin expansion to progress through the year. And in particular, I think if you get back to the Analyst Day, I think you had pointed to SG&A in terms of absolute dollars I believe that will be in flat on a local currency basis for the year. How should we expect that to progress as we move over the next few quarters?

Yeah, that's a great question. And as we progress through the year, we do anticipate improvement in our margins with a particular note as we look short term to the second quarter you will remember that quarter we experienced quite a bit of disruption related to the ERP go-live which would then imply easier to compare on the top-line this year and if we have good solid growth on the top-line that helps with margin expansion. So it wouldn't surprise me to see strength in the margins and in the second quarter in terms of how it rolls out through the years and then, Q3 being back to our seasonal type of tough quarter and maybe something more that we've seen historically and then ending with a good strong Q4. Much of the margin improvement is driven by continued growth and performance on the top-line. And as you look at SG&A spend, if we continue to work to hold it flat throughout the rest of this year, then as we grow the top line, you'll see the SG&A margin continue to expand. The other thing that is important to point out is the 3.5% to 4% reiterating on the top-line takes into consideration that we have just divested a small product line which represented about $8 million a year of sales for us. So we are looking at keeping our top-line guidance and finding other way to make up for that $8 million.

Thanks. That's helpful, and then I guess, lastly for you Norman, any update you can share with us on the M&A pipeline, how you're thinking about the assets that are out there and the types of businesses you might be looking at right now. Thanks. Thanks.

So there continue to be a number of things of interest I would say mostly in the tuck-in category. We continue to be encouraged by what we're seeing and we'd hope that there would be something we can do this year.

All right. I'll hop back. Thank you.

Your next question is from the line of Dan Leonard from Deutsche Bank.

Thank you. So first off, a question on the revenue guidance, so Christine can you help me put in context – so you had a strong first quarter of 4.5% organic revenue growth which is above your guide. The Q2 comp looks pretty favorable given the ERP disruption in the prior year. Is there anything you're seeing as potential caution flags in the second half of the year that would make you -- where are you thinking about a revenue number a bit higher than 3.5% to 4% for in the full year?

No. And maybe it's a good time to remind everyone that the 3.5% to 4% was organic currency neutral on a reported basis. Certainly you can end up being higher than that, but the second half of the year has a couple of tough compares, Q3 becomes a tough compare because that's the quarter we made up last year for the disruptive quarter of Q2 last year. And then of course Q4 was a very big quarter for us in 2017. So the growth rates probably are tougher to compare and especially in the fourth quarter.

Okay. Makes sense and then secondly when you were walking through some of the points of strength, I notice you didn't say blood typing or immunohematology, so can you remind us, are you getting any revenue yet from that LabCorp contract win you announced in November and any update on the progress of the immunohematology ramp in the U.S.?

We are and I'll just make a quick comment and then I'll let John Hertia pipe in and that's probably my doing on the script in terms of not mentioning in it specifically because it is a mixed result. They had the tough compare in Europe. Because a lot of the pull-forward last year was in blood typing products, but they also had very, very good growth in the U.S. as we gained traction in this very important market for blood typing, so John Hertia, that's a good set up for you to talk a little more about it.

Sure. Things in the U.S. are going very, very well for blood typing. I would say the LabCorp implementation is about 85% done with just a few sites finishing up validation and revenue will kick in strongly after that. And we're also getting really good acceptance from the low volume systems that we announced at the beginning of the year. And they're both as backup systems for the IH-1000 and then, kind of introduction in what has been somewhat of a tired market in the past and this is the first time some new technology has been introduced. And also in Asia Pacific, blood typing has been growing very, very strong for us so both North America and Asia have been doing really, really well with respect to blood typing.

Okay. I appreciate that color and then this is my final question and I'll hop back in queue. Christine, possible that of the 230 basis points of year-on-year operating margin expansion on the non-GAAP comparison, operating margin expansion, how much of that was due to foreign currency to weaker U.S. dollar?

Dan, good question, I don't have the details. I don't have the details with me.

Okay. Thank you very much.

Your next question is from the line of David Westenberg with C.L. King. David Westenberg - C.L. King & Associates, Inc.: Hi, thanks for taking the question and congrats on a good quarter.

Thank you. David Westenberg - C.L. King & Associates, Inc.: So you continue to talk about the strength in the Droplet Digital PCR instrument, in RainDance you acquired last year. So can you talk about maybe some of the synergies that you're seeing or anticipate seeing in the RainDance acquisition with your own Digital Droplet PCR system, whether it be R&D or sales synergy?

So I think Annette, that...

Okay. So I think we are very happy with our Digital PCR results and we continue to grow the QX200 and our automated Droplet generators that go along with it. We certainly gained a lot of knowhow and intellectual property with the RainDance acquisition and we're really able to integrate that quite well into our R&D programs moving forward. So we're really happy with that as well. David Westenberg - C.L. King & Associates, Inc.: All right. Yeah. Thank you. And then when we take your guidance, can you talk about considerations of new products versus geographic expansion versus just general growth in the market and how that might break down?

And so, Dave, I just want to make sure I understand you're just talking in general going back to kind of the Investor Day looking at our growth? David Westenberg - C.L. King & Associates, Inc.: Exactly. Components of the growth and those are the three that you laid out in terms of this guidance. Is that still kind of the proportions that you're looking out there in this year's guidance?

I think it is still in line. Obviously as time moves on towards our 2020 target, you start to have cumulative impacts of new products and the geographic expansion. But I think for the first quarter out of the gate we do experience the negative of the pricing pressure, et cetera, but as Annette and John Hertia pointed out in a couple of their product line lines we're seeing very good both geographic extension as well as some new market, new product activity. David Westenberg - C.L. King & Associates, Inc.: Got it. And I noticed on your – in the breakout of the non-GAAP numbers, there is not any inclusion of consultant fees in anticipation of the ERP. I was just wondering, are you still seeing that this year or had those completely fell off?

No, no. We still have costs this year and at this point, it's hard to call those either atypical or unique. I think it is part of the investment in our business and so it's not something that we would non-GAAP out, but as you may remember when we were talking about the outlook for the year we were looking at pretty significant reduced spend in the ERP project for 2018. And that's part of the benefit of the margin expansion. But it's not something that we're going to highlight or non-GAAP out. David Westenberg - C.L. King & Associates, Inc.: I appreciate it. I'll jump back in queue. And then thanks very much for taking the questions, and congratulations on a good quarter.

Thank you.

Your next question is from the line of Brandon Couillard with Jefferies.

Hey, thanks. One question for Annette, if you could share with us any updates or any progress you might have made with respect to the licensing activity for the Droplet Digital PCR IP?

Hi, Brandon. We're rolling – we're getting ready to roll that program out. We really wanted to be thoughtful about how we were going to do that. But we're engaged right now with several parties for commercials that – commercially use licenses for the technology. So it's moving along as we had hoped.

Okay. And then maybe one for Norman, any update you could share with us as far as the COO search and whether you're looking more externally or internally, whether a candidate might be pretty close to coming onboard?

So we've got both internal and external candidates. And I would imagine we'll have something in the not-too-distant future.

All righty. Thank you.

We have no further questions. Thank you. At this time, I would like to turn it back to management for any further comments or closing remarks.

Okay. Thank you, Paige. Again thank you everyone for taking the time to join us today. We appreciate your interest and look forward to the next time we have a chance to speak. Bye-bye.

Ladies and gentlemen, this concludes today's conference. Thank you for your participation and have a wonderful day. You may now disconnect.