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FORM 10-Q

United States
Securities and Exchange Commission
Washington, D. C. 20549

                                                        (Mark One)

                                                               X                     Quarterly Report Pursuant to Section 13 or 15(d)
                                                                                               of the Securities Exchange Act of 1934

For Quarter Ended: November 30, 2003

OR

                                                               _                      Transition Report Pursuant to Section 13 or 15(d)
                                                                                               of the Securities Exchange Act of 1934

Commission File Number: 0-14820

IMMUCOR, INC.
(Exact name of registrant as specified in its charter)

       Georgia                                     22-2408354
(State or other jurisdiction of            (I.R.S. Employer
incorporation or organization)         Identification No.)

3130 Gateway Drive       P.O. Box 5625       Norcross, Georgia 30091-5625
(Address of principal executive offices)          (Zip Code)

Registrant's telephone number: (770) 441-2051

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes X    No

     Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes X    No

     Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

As of January 9, 2004: Common Stock, $0.10 Par Value - 19,682,725

See notes to consolidated financial statements.

See notes to consolidated financial statements.

See notes to consolidated financial statements.

See notes to consolidated financial statements.

IMMUCOR, INC.
Notes to Consolidated Financial Statements
(Unaudited)

1. BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. However, there has been no material change in the information disclosed in the Company’s annual financial statements dated May 31, 2003, except as disclosed herein. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three-month and six-month periods ended November 30, 2003 are not necessarily indicative of the results that may be expected for the year ending May 31, 2004. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended May 31, 2003.

Certain prior year balances have been reclassified to conform to the current year presentation.

2. INVENTORIES

Inventories are stated at the lower of first-in, first-out cost or market:

3. EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 128, Earnings per Share. The Company implemented a three-for-two stock split on November 14, 2003 to shareholders of record as of the close of business October 24, 2003. The Company implemented a three-for-two stock split on September 13, 2002 to shareholders of record as of the close of business on August 26, 2002. The splits were effected in the form of a 50% stock dividend. All share and per share amounts disclosed in this document have been restated to reflect the stock splits discussed in Note 7 to the consolidated financial statements.

4.     DOMESTIC AND FOREIGN OPERATIONS

Information concerning the Company’s domestic and foreign operations is summarized below (in 000s):

The Company’s U.S. operations made net export sales to unaffiliated customers of approximately $1,211,000 and $1,006,000 for the three months ended November 30, 2003 and 2002, respectively and approximately $2,603,000 and $2,237,000 for the six months ended November 30, 2003 and 2002, respectively. The Company’s German operations made net export sales to unaffiliated customers of approximately $1,296,000 and $919,000 for the three months ended November 30, 2003 and 2002, respectively and approximately $2,163,000 and $1,559,000 for the six months ended November 30, 2003 and 2002, respectively. The Company’s Canadian operations made net export sales to unaffiliated customers of approximately $538,000 and $490,000 for the three months ended November 30, 2003 and 2002, respectively and approximately $898,000 and $1,110,000 for the six months ended November 30, 2003 and 2002, respectively. Product sales to affiliates are valued at market prices.

5.     COMPREHENSIVE INCOME

The components of comprehensive income for the three-month and six-month periods ended November 30, 2003 and 2002 are as follows:

Accumulated comprehensive income (loss) as of November 30, 2003 and May 31, 2003 was $28,915 and ($782,262), respectively. The balance, consisting primarily of net gains on foreign currency translation adjustments, has been disclosed in the shareholders’ equity section of the consolidated balance sheets.

6.     IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

In June 2001, the FASB issued SFAS No. 143, Accounting for Asset Retirement Obligations (“SFAS No. 143”). SFAS No. 143 applies to legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and/or the normal operation of a long-lived asset. For the purposes of SFAS No. 143, a legal obligation is an obligation that a party is required to settle as a result of an existing or enacted law, statute, ordinance, or written or oral contract or that is based on a promise and an expectation of performance. SFAS No. 143 is effective for financial statements for fiscal years beginning after June 15, 2002. The Company adopted SFAS No. 143 effective June 1, 2003 without impact on its financial position or results of operations.

In July 2002, the FASB issued SFAS No. 146, Accounting for Costs Associated with Exit or Disposal Activities (“SFAS No. 146”), which addresses financial accounting and reporting for costs associated with exit or disposal activities and nullifies Emerging Issues Task Force (“EITF”) Issue No. 94-3, Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including certain costs incurred in a restructuring). The provisions of SFAS No. 146 are effective for exit or disposal activities that are initiated after December 31, 2002. At adoption on January 1, 2003, SFAS No. 146 did not have a significant impact on the Company’s consolidated statements of operations or financial position. The Company does not have any in-process or planned exit or disposal activities as of November 30, 2003.

In November 2002, the FASB issued Interpretation No. 45, Guarantor’s Accounting and Disclosure Requirements for Guarantees (“FIN No. 45”). FIN No. 45 requires a guarantor to recognize, at the inception of a guarantee, a liability for the fair value of the obligation it has undertaken in issuing the guarantee. The Company must apply FIN No. 45 to guarantees, if any, issued or modified after December 31, 2002. FIN No. 45 also requires guarantors to disclose certain information for guarantees, including product warranties, outstanding at the end of interim periods ending after December 15, 2002. At adoption, FIN No. 45 did not have a significant impact on the Company’s consolidated statements of operations or financial position. The Company does not have any material warranty obligations or other guarantees as of November 30, 2003.

In November 2002, the EITF reached a consensus on EITF Issue No. 00-21, Revenue Arrangements with Multiple Deliverables (“EITF 00-21”). The Issue addresses certain aspects of the accounting for arrangements under which a vendor will perform multiple revenue-generating activities. EITF 00-21 addresses when a revenue arrangement with multiple deliverables should be divided into separate units of accounting and, if separation is appropriate, how the arrangement consideration should be allocated to the identified accounting units. The Company adopted the provisions of EITF 00-21 effective July 1, 2003, without material impact on its financial statements.

See Note 8 to the consolidated financial statements for a discussion of SFAS No. 148, Accounting for Stock-Based Compensation – Transition and Disclosure – an amendment of FASB Statement No. 123.

In January 2003, the FASB issued Interpretation No. 46, Consolidation of Variable Interest Entities, an Interpretation of Accounting Research Bulletin (ARB) No. 51 (“FIN No. 46”). FIN No. 46 requires certain variable interest entities, or VIEs, to be consolidated by the primary beneficiary of the entity if the equity investors in the entity do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. FIN No. 46 is effective for all VIEs created or acquired after January 31, 2003. For VIEs created or acquired prior to February 1, 2003, the provisions of FIN No. 46 must be applied for the first interim or annual period beginning after December 15, 2003. The Company does not expect that the adoption of FIN No. 46 will have a material impact on its financial statements.

In April 2003, the FASB issued SFAS No. 149, Amendments of Statement 133 on Derivative Instruments and Hedging Activities (“SFAS No. 149”). SFAS No. 149 amends and clarifies financial accounting and reporting for derivative instruments, including certain instruments embedded in other contracts and for hedging activities under FASB Statement No. 133, Accounting for Derivative Instruments and Hedging Activities. This statement requires that contracts with comparable characteristics be accounted for similarly. In particular, this statement clarifies under what circumstances a contract with an initial net investment meets the characteristic of a derivative, clarifies when a derivative contains a financing component, amends the definition of an underlying hedged risk to conform to language used in FIN No. 45 and amends certain other existing pronouncements. This statement, the provisions of which are to be applied prospectively, is effective for contracts entered into or modified after June 30, 2003. The adoption of SFAS No. 149, on July 1, 2003, did not have a material impact on the Company’s financial condition or results of operations.

In May 2003, the FASB issued SFAS No. 150, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity (“SFAS No. 150”). SFAS No. 150 establishes standards for how an issuer classifies and measures in its statement of financial position certain financial instruments with characteristics of both liabilities and equity. SFAS No. 150 requires that an issuer classify a financial instrument that is within SFAS No. 150‘s scope as a liability (or an asset in some circumstances) because that financial instrument embodies an obligation of the issuer. Many of those instruments were previously classified as equity. SFAS No. 150 requires an issuer to classify the following instruments as liabilities (or assets in some circumstances): mandatorily redeemable financial instruments; obligations to repurchase the issuer’s equity shares by transferring assets; and certain obligations to issue a variable number of its equity shares. SFAS No. 150 is effective for all financial instruments entered into or modified after May 31, 2003, and otherwise shall be effective at the beginning of the first interim period beginning after June 15, 2003. The adoption of SFAS No. 150, on September 1, 2003, did not have a material effect on the Company’s financial condition or results of operations.

7.     STOCK SPLITS

On September 19, 2003, the Board of Directors approved a three-for-two stock split, which was effected in the form of a 50% stock dividend. The date of distribution was November 14, 2003 to the shareholders of record at the close of business on October 24, 2003. The number of shares outstanding at the close of business on October 24, 2003 was 13,090,834. The stock split added an additional 6,543,111 shares to outstanding shares. All share and per share amounts disclosed in this document have been restated to reflect this stock split. The total number of shares outstanding at the stock split pay date was 19,633,945.

On July 24, 2002, the Board of Directors approved a three-for-two stock split, which was effected in the form of a 50% stock dividend. The date of distribution was September 13, 2002 to the shareholders of record at the close of business on August 26, 2002. The number of shares outstanding at the close of business on August 26, 2002 was 8,257,277. The stock split added an additional 4,128,639 shares to outstanding shares. All share and per share amounts disclosed in this document have been restated to reflect this stock split. The total number of shares outstanding at the stock split pay date was 12,385,916.

8.     STOCK-BASED COMPENSATION

The Company grants stock options for a fixed number of shares to employees with an exercise price equal to the fair value of the shares at the date of the grant. The Company accounts for stock option grants in accordance with APB Opinion No. 25, Accounting for Stock Issued to Employees, and accordingly does not recognize compensation expense for the stock option grants.

In December 2002, the FASB issued SFAS No. 148, Accounting for Stock-Based Compensation – Transition and Disclosure – an amendment of FASB Statement No. 123. This Statement provides alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, this Statement amends the disclosure requirements of Statement 123 to require prominent disclosures in both annual and interim financial statements about the method of accounting for stock-based employee compensation and the effect of the method used on reported results. The following table illustrates the effect on net income and earnings per share as if the Company had applied the fair value recognition provisions of SFAS No. 123 to stock-based employee compensation.

9.     SUBSEQUENT EVENT

On December 18, 2003 the Company closed a new $27 million secured credit facility with SunTrust Bank. The new credit facility matures in three years and is composed of a $15 million revolver and a $12 million term loan, both at terms more favorable to the Company than its previous credit facility. The Company terminated its secured bank line of credit and term loan that had been in place since 1998 with a different bank. The Company will record a non-cash, pre-tax charge of $924 thousand in the third quarter to write off unamortized deferred financing charges related to its previous credit facility. This charge will reduce third quarter earnings by approximately $0.03 per diluted share

ITEM 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations.

Certain statements that Immucor may make from time to time, including all statements contained in this report that are not statements of historical fact, constitute “forward-looking statements” under the federal securities laws. Forward-looking statements may be identified by words such as “plans,” “expects,” “believes,” “anticipates,” “estimates,” “projects,” “will” and other words of similar meaning used in conjunction with, among other things, discussions of future operations, financial performance, product development and new product launches, FDA and other regulatory applications and approvals, market position and expenditures. Factors that could cause actual results to differ materially from those expressed in any forward-looking statement made by, or on behalf of, Immucor include the following, some of which are described in greater detail below: the decision of customers to defer capital spending, increased competition in the sale of instruments and reagents, product development or regulatory obstacles, changes in interest rates, fluctuations in foreign currency exchange rates and general economic conditions. Investors are cautioned not to place undue reliance on any forward-looking statements. Immucor cautions that historical results should not be relied upon as indications of future performance. Immucor assumes no obligation to update any forward-looking statements.

Critical Accounting Policies

General

We have identified the policies below as critical to our business operations and the understanding of our results of operations. The impact and any associated risks related to these policies on our business operations is discussed throughout Management’s Discussion and Analysis of Financial Condition and Results of Operations where such policies affect our reported and expected financial results. For a detailed discussion on the application of these and other accounting policies, see Note 1, Note 6 and Note 8 to the Consolidated Financial Statements of this Quarterly Report on Form 10-Q. Note that our preparation of this Form 10-Q requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of our financial statements, and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates, and certain assumptions could prove to be incorrect.

Revenue Recognition

The Company recognizes revenue when the following four basic criteria have been met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed and determinable; and (4) collectibility is reasonably assured. Should changes in conditions cause management to determine these criteria are not met for certain future transactions, revenue recognized for any reporting period could be adversely affected. Revenue from the sale of the Company’s reagents is recognized upon shipment since both title and risk of loss transfers to the customer upon shipment. Revenue from the sale of the Company’s medical instruments is recognized upon shipment and completion of contractual obligations relating to training and/or installation based on terms of the related agreements. Revenue from rentals of the Company’s medical instruments is recognized over the life of the rental agreement. Instrument service contract revenue is recognized over the life of the contract.

We adopted Emerging Issues Task Force Issue (“EITF”) No. 00-21, Accounting for Revenue Arrangements with Multiple Deliverables, for agreements entered into in the second quarter of fiscal year 2004. Agreements with multiple deliverables are reviewed and the deliverables are separated into units of accounting under the provisions of EITF No. 00-21. The total consideration received is allocated based on the estimated fair value of the units of accounting, which requires judgment by management. Revenue is recognized as the elements are delivered, assuming all the other conditions for recognition of revenue discussed in the preceding paragraph have been met.

Allowance for Doubtful Accounts

Immucor maintains an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. The allowance is approximately 7.2% of the accounts receivable balance. The Company continually monitors the collectibility of its customer accounts and when indications arise that an amount is not likely to be collected, the amount is charged to the allowance for doubtful accounts. If the financial condition of any of Immucor’s customers was to deteriorate, resulting in an impairment of their ability to make payments, additional allowances could be required. No material changes have been made to the allowance for doubtful accounts policy during fiscal 2004.

Inventory

Inventories are stated at the lower of first-in, first-out cost or market. Cost includes material, labor and manufacturing overhead. The Company uses a standard cost system as a tool to monitor production efficiency. The standard cost system applies estimated labor and manufacturing overhead factors to inventory based on budgeted production levels, staffing levels and costs of operation. Actual costs and production levels may vary from the standards and are charged to the consolidated statements of operations as a component of cost of sales. Since generally accepted accounting principles require that the standard cost approximate actual cost, periodic adjustments are necessary. No material changes have been made to the inventory policy during fiscal 2004.

Goodwill and Other Long-lived Assets

In assessing the recoverability of the Company’s goodwill and other long-lived assets the Company must make assumptions regarding estimated future cash flows and other factors to determine the fair value of the respective assets. If these estimates or their related assumptions change in the future, the Company may be required to record impairment charges for these assets not previously recorded. On June 1, 2002 the Company adopted Statement of Financial Accounting Standards (“SFAS”) No. 142, Goodwill and Other Intangible Assets, and is required to analyze its goodwill and indefinite lived intangible assets for impairment on an annual basis or more frequently if impairment indicators arise. In October 2001, the FASB issued SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. The Statement supercedes SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of, however it retains the fundamental provisions of that statement related to the recognition and measurement of the impairment of long-lived assets to be “held and used.” The Company adopted SFAS No. 144 effective June 1, 2002 without impact on its financial position or results of operations.

Income Taxes

Our income tax policy records the estimated future tax effects of temporary differences between the tax bases of assets and liabilities and amounts reported in the accompanying consolidated balance sheets, as well as operating loss and tax credit carry-forwards. We follow very specific and detailed guidelines regarding the recoverability of any tax assets recorded on the balance sheet and provide any allowances as required. The Company believes that the value of the Company’s deferred tax assets assumes that the Company will be able to generate sufficient future taxable income in certain tax jurisdictions, based on estimates and assumptions. If these estimates and related assumptions change in the future, the Company may be required to record additional valuation allowances against its deferred tax assets resulting in additional income tax expense in the Company’s consolidated statements of operations. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, carry-back opportunities, and tax-planning strategies in making this assessment. Management evaluates the realizability of the deferred tax assets and assesses the need for additional valuation allowances quarterly. No material changes have been made to the income tax policy during fiscal 2004.

Stock-Based Employee Compensation

The Company grants stock options for a fixed number of shares to employees with an exercise price equal to the fair value of the shares at the date of the grant. The Company accounts for stock option grants in accordance with APB Opinion No. 25, Accounting for Stock Issued to Employees, and accordingly does not recognize compensation expense for the stock option grants. In December 2002, the FASB issued SFAS No. 148, Accounting for Stock-Based Compensation – Transition and Disclosure – an amendment of FASB Statement No. 123. This Statement provides alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, this Statement amends the disclosure requirements of Statement 123 to require prominent disclosures in both annual and interim financial statements about the method of accounting for stock-based employee compensation and the effect of the method used on reported results. The Company adopted the interim disclosure requirements in the period ended May 31, 2003. See Note 8 of the consolidated financial statements.

Financial Condition, Liquidity and Capital Resources

Net cash provided by operating activities totaled approximately $10.9 million and $5.5 million for the six-month periods ending November 30, 2003 and 2002, respectively. As of November 30, 2003, the Company’s cash and cash equivalents balance totaled $9.4 million, a decrease of approximately $1.8 million from the balance as of May 31, 2003. Cash provided by operating activities from the six-month period ending November 30, 2003 over the six-month period ending November 30, 2002 increased significantly, as detailed below.

During the six-month period ended November 30, 2003, accounts receivable decreased by approximately $0.7 million primarily due to improved collections. Factored Italian accounts receivables that are classified as other receivables, had a net decline of $0.2 million as advances that were received on the accounts. Inventory rose $2.6 million during the six-month period ended November 30, 2003 primarily due to receipt of 21 ABS2000 instruments under an outstanding purchase commitment in the U.S. and higher instrument levels in Europe. Income tax refunds receivable, primarily in the U.S., had increased in the three-month period ended May 31, 2003 due to a planned restructuring of certain European operations that allowed for the utilization of tax losses generated in prior years. This receivable balance has been offset, in the six-month period ended November 30, 2003, with the tax liability generated by earnings during that period, net of the tax benefit related to stock options exercised. Prepaid and other assets decreased approximately $0.7 million during the six-month period ended November 30, 2003, as deposits on the ABS2000 units received during the period were moved into inventory and the VAT receivable in Germany declined.

Other long-term assets decreased by approximately $0.2 million due primarily to amortization of debt issue costs. Deferred licensing costs and customer list declined in the six-month period ended November 30, 2003 due to normal amortization. Excess of cost over net tangible assets acquired increased due to the effect of foreign exchange rates against the dollar.

Accounts payable remained relatively constant during the six-month period ended November 30, 2003 when compared to changes is accounts payable levels at November 30, 2002. Income tax liability increased $0.6 million primarily due to increased earnings in the six-month period ended November 30, 2003, net of the tax benefit related to stock options exercised. Accrued salaries and wages were relatively constant during the six-month period ended November 30, 2003. Net deferred income tax liabilities remained relatively constant during the six-month period ended November 30, 2003. Other accrued liabilities declined during the six-month period ended November 30, 2003, due to reduced accrued audit fees and reduced suspended VAT payable on Italian factored receivables. Other long-term liabilities decreased primarily due to the changes in the value of the interest rate swap agreement and decreases in deferred instrument revenue.

During the six-month period ended November 30, 2003, $3.7 million of cash was used in investing activities primarily for capital expenditures of $1.8 million for Galileo and other instruments at customer sites on reagent rental agreements and for demonstration, $0.3 million for computer hardware and software enhancements of the enterprise software system, $0.1 million to refurbish the German facility, $1.0 million for manufacturing and quality system improvements at its Norcross and Houston facilities and approximately $0.5 million for the previously announced development project to produce human collagen mesh. Planned capital expenditures for the remainder of fiscal 2004 total approximately $1.5 million. Additionally, the Company has budgeted $1.0 million for manufacturing and quality system improvements at its Norcross and Houston facilities, $0.3 million at its Canadian facility, and $0.2 million to upgrade its German facility as its European distribution center.

Net cash used in financing activities during the six-month period ended November 30, 2003 totaled approximately $8.8 million, including approximately $10.0 million in payments of long-term debt, line of credit and capital lease obligations, which was partially offset by the receipt of $1.3 million in cash from the exercise of stock options. Most of these options were granted in prior fiscal years and provide for exercise prices equal to the market value of the Company’s stock on the date granted.

During the six-months ended November 30, 2003, common stock and additional paid-in capital increased by an aggregate of $2.9 million primarily due to the exercise of stock options, described above, including the related tax benefit. Approximately $113,000 of stock options (aggregate exercise price) were exercised as of November 30, 2003, but are classified as a receivable until the amounts due from financial institutions are received. Also, common stock increased and retained earnings decreased by approximately $0.6 million due to the effect of the three-for-two stock split on November 14, 2003. Retained earnings and comprehensive income (loss) improved by $7.9 million due to the earnings for the six-month period ended November 30, 2003 and by favorable changes in the net foreign exchange translation. The financial statements of foreign subsidiaries have been translated into U.S. dollars in accordance with FASB Statement No. 52, Foreign Currency Translation. All balance sheet accounts have been translated using the exchange rates in effect at the balance sheet dates. Income statement amounts have been translated using the average exchange rates for each year. The gains and losses resulting from the changes in exchange rates from year to year have been reported separately as a component of comprehensive income (loss). The effect of foreign currency transaction gains and losses has been recorded in the accompanying statements of operations.

Management continues to focus on reducing the debt on the Company’s balance sheet and does not anticipate that there will be a need for additional borrowings in the foreseeable future. Management expects that cash and cash equivalents and internally generated funds will be sufficient to support operations, scheduled debt repayments and planned capital expenditures for the next 12 months, as well as fund future long-term debt payments.

Results of Operations

Immucor generated net sales of $27.2 million in the three-month period ended November 30, 2003, versus $23.7 million in the three-month period ended November 30, 2002 and $54.5 million in the six-month period ended November 30, 2003, versus $47.0 million in the six-month period ended November 30, 2002. Net income for the three-month period ended November 30, 2003 totaled $3.4 million, equivalent to the same quarter last year and $7.1 million in the six-month period ended November 30, 2003, versus $6.4 million in the six-month period ended November 30, 2002. Diluted earnings per share, totaling $0.17 on 20.9 million weighted average shares outstanding for the three-month period ended November 30, 2003, compared with diluted earnings per share of $0.17 on 19.9 million weighted average shares outstanding in the three-month period ended November 30, 2002. Diluted earnings per share, totaling $0.34 on 20.8 million weighted average shares outstanding for the six-month period ended November 30, 2003, compared with diluted earnings per share of $0.32 on 19.9 million weighted average shares outstanding in the six-month period ended November 30, 2002. All share and per share amounts have been adjusted to reflect the three-for-two stock splits effected in the form of a 50% stock dividend that were distributed on November 14, 2003 and September 13, 2002. For the three-month period ended November 30, 2003, the effect on net sales and gross margin of the change in the Euro exchange rate was an approximate increase of $1.2 million and $0.4 million, respectively, and minimal for net income. For the six-month period ended November 30, 2003, the effect on net sales and gross margin of the change in the Euro exchange rate was an approximate increase of $2.2 million and $1.0 million, respectively and minimal for net income.

Net Sales

Sales of instruments were $2.1 million in the second quarter of 2004 compared to $1.6 million in the second quarter of 2003. Instrument sales for the six months grew by approximately $1.9 million to $4.6 million, a 66% increase over the six months ended November 30, 2002. Comparing the quarter ended November 30, 2003 to the quarter ended August 31, 2003, sales of instruments in Europe grew to $1.3 million in the second quarter of fiscal 2004, up from $1.0 million in the first quarter. Demand for the Galileo high volume instrument continues to be strong since its introduction to the European market. During the quarter, 23 Galileo instruments were placed, 13 outright sales and 10 placed under reagent rental agreements, resulting in 93 Galileo placements in Europe as of November 30, 2003, and an additional 8 Galileos have been placed under evaluation at customer sites. In the U.S. instrument sales fell to $740 thousand in the second quarter versus $1.5 million in the first quarter. The timing of instrument sales for the U.S. is difficult to predict due to the long sales cycle. The instrument backlog in the U.S. currently stands at $0.8 million. Galileo clinical trial data has been collected in the U.S. and the Company is in the process of preparing the FDA submission that is expected to be submitted in February.

Comparing the quarter ended November 30, 2003 to the quarter ended August 31, 2003, there was a decline of approximately $0.4 million in U.S. traditional reagent sales comprised of products not utilizing the Company’s patented Capture® technology,from the first quarter of fiscal 2004 due primarily to reduced sales of serum and cell products. The shortfall is believed to be due in large part to customer ordering patterns, mainly for international distributors who buy the Company’s products in the U.S., and not from an overall decrease in demand or loss of market share. Comparing the quarter ended November 30, 2003 to the quarter ended November 30, 2002, sales of traditional reagent products increased $2.0 million, or 11.5%, from $17.5 million in the second quarter of fiscal 2003 to $19.5 million in the second quarter of fiscal 2004. Year to date traditional reagent sales increased $4.4 million, or 12.5%, from $35.1 million in the six-month period ended November 30, 2002 to $39.5 million in the six-month period ended November 30, 2003. Sales of Capture® products increased approximately $1.0 million to $5.6 million for the three-month period ended November 30, 2003, a 22.7% increase over the prior year quarter. For the six-month period ended November 30, 2003, sales of Capture® products increased approximately $1.5 million to $10.5 million, an increase of 16.8% over the six-month period ended November 30, 2002. The Company believes growth in reagent revenue occurred primarily as a result of price increases including group contract renewals at higher prices in North America, which contributed $1.2 million and $1.8 million to the increase for the three-month and six-month periods ended November 30, 2003, respectively.

Gross Margin

Gross margin, as a percentage of sales, was 55.9% and 56.0% for the three-month and six-month period ended November 30, 2003, respectively, versus 57.8% and 57.7% for the three-month and six-month period ended November 30, 2002, respectively. The gross margin on traditional reagents remained relatively constant at 60.4% and 60.1% for the three-month and six-month period ended November 30, 2003, respectively, as compared to 59.8% and 60.3% in the three-month and six-month period ended November 30, 2002, respectively. The gross margin on Capture® products was 62.0% and 62.3% for the three-month and six-month period ended November 30, 2003, respectively, as compared to 69.3% and 68.4% in the three-month and six-month period ended November 30, 2002, respectively. The gross margin percentage on Capture® products was diminished by increased sales through the distributor network in Europe at lower margins to the Company. The Company believes that utilizing distributors established in key European markets is far more advantageous to the Company than developing its own sales and distribution network in these markets. The gross margin on instruments was 44.5% for the quarter ended November 30, 2003, compared to 42.8% for the quarter ended November 30, 2002. Instrument service continued to be provided at a loss for the three-month and six-month periods ended November 30, 2003, as overall instrument placements have not reached the level required for service operations to break-even.

Gross margin, as a percentage of sales, was less than expected based on the Company’s previously announced expectations. The decline in U.S. sales described above accounted for approximately $0.6 million of lower gross profit attributable to U.S. operations during the quarter ended November 30, 2003, as compared to the quarter ended August 31, 2003. Worldwide expenses to accommodate European Regulatory requirements for CE marking on products intended for sale within Europe grew to $0.3 million during the quarter ended November 30, 2003, compared to minimal expenditures in the quarter ended November 30, 2002. This reduced gross profit for the quarter ended November 30, 2003, by approximately $0.2 million, and the remainder is primarily classified as operating expense. It is expected that additional expenses will be incurred to complete CE marking activities in the third quarter of 2004. During the second quarter the Company successfully filed for CE marking 57 list A products, 53 list B products and in excess of 70 self declared products and received a recommendation for certification of CE marking.

Operating expenses

When compared to the three-month and six-month period ended November 30, 2002, research and development costs of $0.4 million and $0.8 million, respectively, have nearly doubled for the three-month and six-month period ended November 30, 2003 to $0.7 million and $1.5 million, respectively. Increases are primarily related to domestic field trials of the Galileo instrument, expenditures for the Biotek platelet and human collagen projects, additional expenses for new product initiatives and expenses related to the promotion of the Chief Scientific Officer who was previously considered part of the cost of manufacturing operations.

Selling and marketing expenses increased $0.8 million and $1.3 million for the three-month and six-month period ended November 30, 2003, respectively, as compared to the three-month and six-month period ended November 30, 2002. The increase is primarily related to travel and marketing expense associated with the sales efforts to market the Galileo in Europe, the ABS2000 road show in the United States, and expenditures for product branding. Additionally, the change in the Euro exchange rate resulted in an increase of approximately $0.3 million and $0.5 million in selling and marketing expenses for the three-month and six-month period ended November 30, 2003, respectively.

Distribution expenses for the three-month and six-month period ended November 30, 2003, increased by $0.1 million and $0.4 million, respectively, compared to the three-month and six-month period ended November 30, 2002, primarily due to additional shipping expenses related to new customers and the implementation of a new shipping package configuration for the Houston facility. The configuration is designed to maintain acceptable environmental temperatures and preserve product quality during shipment during the hot summer months but resulted in a significant increase in the weight and volume of packages processed.

General and administrative expenses for the three-month and six-month period ended November 30, 2003, have risen approximately $0.2 million and $0.7 million, respectively, over the three-month and six-month period ended November 30, 2002. The change in the Euro exchange rate accounted for approximately $0.1 million and $0.4 million, respectively. The remaining increase was due to additional personnel and expenditures to support domestic and international efforts to expand Company presence and ensure compliance with European Union quality regulations and accounting and SEC regulatory mandates in the United States.

Amortization expense remained relatively constant for the three-month and six-month period ended November 30, 2003, as compared with the three-month and six-month period ended November 30, 2002. In June 2002, the Company adopted SFAS No.142, Goodwill and Other Intangible Assets, which requires goodwill and indefinite lived intangible assets to be reviewed annually for impairment, or more frequently if impairment factors arise, instead of amortized. The Company tested goodwill for impairment as of March 1, 2003, utilizing a combination of valuation techniques, including the expected present value of future cash flows and a market multiple approach, and found no impairment.

Interest expense

When compared to the three-month and six-month period ended November 30, 2002, interest expense decreased $0.2 million and $0.7 million in three-month and six-month period ended November 30, 2003, respectively. The decrease is primarily the result of reduced borrowings on long-term debt and a favorable mark-to-market adjustment of the interest rate swap agreement.

Other income (expense)

Other income, net, for the three-month and six-month period ended November 30, 2003, primarily reflects foreign currency transaction gains that exceeded foreign currency transaction losses, over the three-month and six-month period ended November 30, 2002, where foreign currency transaction losses exceeded foreign currency transaction gains.

Income taxes

The provision for income taxes rose with the increase of pretax income, but declined to 35.4% and 35.2% as a percentage of pretax income, for the three-month and six-month period ended November 30, 2003 respectively, versus 37.8% and 36.8% for the three-month and six-month period ended November 30, 2002, respectively, due to the utilization of tax losses generated in prior years made available by the restructuring of certain European operations in fiscal 2003 and other tax saving initiatives.

ITEM 3. Quantitative and Qualitative Disclosures On Market Risk

There have been no material changes regarding the Company’s market risk position from the information provided in its Annual Report on Form 10-K for the fiscal year ended May 31, 2003. The quantitative and qualitative disclosures about market risk are discussed in Item 7A-Quantitative and Qualitative Disclosures About Market Risk, contained in the Company’s Annual Report on Form 10-K.

ITEM 4. Controls and Procedures.

As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Rule 13a-15(b) and 15d-15(b) under the Exchange Act. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective. There were no significant changes in the Company’s internal controls over financial reporting or in other factors identified in connection with this evaluation that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II

OTHER INFORMATION

ITEM 2.   Changes in Securities and Use of Proceeds.

On September 19, 2003, the Board of Directors approved a three-for-two stock split of the Company’s common stock, which was effected in the form of a 50% stock dividend. The date of distribution was November 14, 2003 to the shareholders of record on October 24, 2003. The stock split resulted in the issuance of an additional 6,543,111 shares. The total number of shares outstanding at the stock split pay date of November 14, 2003 was 19,633,945.

ITEM 4.   Submission of Matters to a Vote of Security Holders.

The Company held its Annual Meeting of Shareholders on November 14, 2003. The following is a summary of the matters voted on at that meeting:

        The shareholders voted on the election of seven directors, all incumbent directors of the Company, to serve for a one-year term or until their successors are duly elected and qualified. Each of these directors was elected by the affirmative vote of a plurality of the votes cast at the Annual Meeting. The number of shares cast for and the number of shares withheld, with respect to each of these persons, were as follows:

        At the Annual Meeting, the shareholders also voted to approve the Immucor, Inc. 2003 Stock Option Plan. The number of shares cast for, votes cast against, abstentions and broker non-votes, with respect to this matter, were as follows:

ITEM 6. Exhibits and Reports on Form 8-K.

(a)     The Company has filed the following exhibits with this report.

31.1       Certification of Principal Executive Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a).*

31.2       Certification of Principal Financial Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a).*

32.1       Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

32.2       Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

(b)     The following report on Form 8-K was filed during the quarter ended November 30, 2003.

                  Form 8-K furnishing the Company’s first quarter 2004 earnings release on October 1, 2003.

SIGNATURES

        Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

IMMUCOR, INC.
(Registrant)

Date: January 14, 2004                                             By:       /s/ Edward L. Gallup

Edward L. Gallup, President and Chief Executive Officer                                                 (on behalf of Registrant and as Principal Executive Officer)

                                                                                                   /s/ Steven C.Ramsey

Steven C. Ramsey, Senior Vice President - Finance                                                                                                   (Principal Accounting Officer)

EXHIBIT INDEX

Number Description

31.1       Certification of Principal Executive Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a).*

31.2       Certification of Principal Financial Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a).*

32.1       Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

32.2       Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*