AUSTIN, Texas, May 1, 2017 /PRNewswire/ -- Luminex
Corporation (NASDAQ:LMNX) today announced financial results for the first quarter of 2017. Financial and operating
highlights for the quarter include the following:
- Consolidated revenue of $77.8 million, an increase of 23% compared to the first quarter
2016.
- Total Verigene related revenue of $10.5 million; growth of 59% over its first quarter
2016.
- Corporate gross margin increased to 68% from 61% in the fourth quarter, 2016 primarily due to overall product mix and
improving gross margins on our automated sample to answer molecular products.
- GAAP net income of $9.2 million, or $0.21 per diluted
share. Non-GAAP net income of $12.2 million, or $0.28 per
diluted share (see Non-GAAP reconciliation).
- Extended LabCorp commitment to buy CF products through at least the end of 2017.
- Initiated a quarterly cash dividend of $0.06 per share.
"Our diversified business model generated excellent financial results in the first quarter. Our partner business, which we now
call the Licensed Technologies Group, grew 10% year over year, and our portfolio of automated molecular sample to answer
solutions grew more than 65% on a pro-forma basis. We are especially pleased that corporate gross margins rebounded from the
end of 2016 due to improving margins amongst our sample to answer molecular revenues and overall product mix," said Homi Shamir, President and Chief Executive Officer of Luminex. "We are raising our 2017 revenue guidance to
reflect these excellent results and the improved outlook for both our CF and automated system product lines. In addition, we are
ahead of plan in realizing synergies from the Nanosphere acquisition and currently believe it will be accretive earlier than
originally anticipated. We also initiated a dividend this quarter, as part of our capital allocation strategy, reflecting the
confidence we have in our ability to execute on our growth initiatives while continuing to generate strong future cash flows. We
are very pleased with the Company's performance year-to-date and remain laser focused on delivering shareholder value."
REVENUE SUMMARY
(in thousands, except percentages)
|
|
|
Three Months Ended
|
|
|
|
|
|
March 31,
|
|
Variance
|
|
2017
|
|
2016
|
|
($)
|
|
(%)
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
System sales
|
$ 8,501
|
|
$ 8,318
|
|
$ 183
|
|
2%
|
Consumable sales
|
15,385
|
|
11,850
|
|
3,535
|
|
30%
|
Royalty revenue
|
11,561
|
|
11,468
|
|
93
|
|
1%
|
Assay revenue
|
37,407
|
|
27,039
|
|
10,368
|
|
38%
|
All other revenue
|
4,925
|
|
4,306
|
|
619
|
|
14%
|
|
$ 77,779
|
|
$ 62,981
|
|
$ 14,798
|
|
23%
|
Additional Highlights:
- Infectious disease assay sales were approximately 82% of total first quarter assay revenues and genetic testing assays were
18%.
- 242 multiplexing analyzers were shipped during the quarter; included in this figure is a combination of MAGPIX®
systems, LX systems, FLEXMAP 3D® systems.
FINANCIAL OUTLOOK AND GUIDANCE
The Company provides annual revenue guidance, updated, as appropriate, at each quarterly reporting period. Luminex raises its
2017 annual revenue guidance range to between $300 million and $310 million from between
$295 million and $305 million. The company expects second quarter 2017 revenue to be between
$74 million and $76 million.
CONFERENCE CALL
Management will host a conference call at 3:30 p.m. CDT / 4:30 p.m.
EDT, Monday, May 1, 2017 to discuss the operating highlights and financial results for the
first quarter 2017 ended March 31, 2017. The conference call will be webcast live and may be
accessed at Luminex Corporation's website at http://www.luminexcorp.com. Simply log on to the web at the address above, go to the Company section and
access the Investor Relations link. Please go to the website at least 15 minutes prior to the call to register, download and
install any necessary audio/video software. If you are unable to participate during the live webcast, the call will be archived
for six months on the website using the 'replay' link.
Luminex develops, manufactures and markets proprietary biological testing technologies with applications throughout the life
sciences industry. The Company's xMAP® system is an open-architecture, multi-analyte technology platform that delivers
fast, accurate and cost-effective bioassay results to markets as diverse as pharmaceutical drug discovery, clinical diagnostics
and biomedical research, including the genomics and proteomics research markets. The Company's xMAP technology is sold worldwide
and is in use in leading research laboratories as well as major pharmaceutical, diagnostic and biotechnology companies.
Further information on Luminex or xMAP can be obtained on the Internet at http://www.luminexcorp.com.
Statements made in this release that express Luminex's or management's intentions, plans, beliefs, expectations or
predictions of future events are forward-looking statements. Forward-looking statements in this release include statements
regarding expected revenue and cost savings, projected 2017 performance, including revenue guidance, including the revenue
contribution from our recently completed acquisition of Nanosphere, Inc. The words "believe," "expect," "intend," "estimate,"
"anticipate," "will," "could," "should" and similar expressions are intended to further identify such forward-looking statements
for purposes of the Private Securities Litigation Reform Act of 1995. It is important to note that the Company's actual
results or performance could differ materially from those anticipated or projected in such forward-looking statements.
Factors that could cause Luminex's actual results or performance to differ materially include risks and uncertainties relating
to, among others, market demand and acceptance of Luminex's products and technology in development, including ARIES
® , Verigene ® and NxTAG ® products, dependence on strategic partners for
development, commercialization and distribution of products, concentration of Luminex's revenue in a limited number of direct
customers and strategic partners, some of which may be experiencing decreased demand for their products utilizing or
incorporating Luminex's technology, budget or finance constraints in the current economic environment, or periodic variability in
their purchasing patterns or practices as a result of material resource planning challenges, the timing of and process for
regulatory approvals, the impact of the ongoing uncertainty in global finance markets and changes in governmental funding,
including its effects on the capital spending policies of Luminex's partners and end users and their ability to finance purchases
of Luminex's products, fluctuations in quarterly results due to a lengthy and unpredictable sales cycle, fluctuations in bulk
purchases of consumables, fluctuations in product mix, and the seasonal nature of some of Luminex's assay products, Luminex's
ability to obtain and enforce intellectual property protections on Luminex's products and technologies, risks and uncertainties
associated with implementing Luminex's acquisition strategy, including Luminex's ability to obtain financing, Luminex's ability
to integrate acquired companies or selected assets into Luminex's consolidated business operations, and the ability to recognize
the benefits of Luminex's acquisitions, reliance on third party distributors for distribution of specific Luminex-developed and
manufactured assay products, Luminex's ability to scale manufacturing operations and manage operating expenses, gross margins and
inventory levels, changes in principal members of Luminex's management staff, potential shortages, or increases in costs, of
components or other disruptions to Luminex's manufacturing operations, competition and competitive technologies utilized by
Luminex's competitors, Luminex's ability to successfully launch new products in a timely manner, Luminex's increasing dependency
on information technology to improve the effectiveness of Luminex's operations and to monitor financial accuracy and efficiency,
the implementation, including any modification, of Luminex's strategic operating plans, the uncertainty regarding the outcome or
expense of any litigation brought against or initiated by Luminex, and risks relating to Luminex's foreign operations, including
fluctuations in exchange rates, tariffs, customs and other barriers to importing/exporting materials and products in a cost
effective and timely manner; difficulties in accounts receivable collections; the burden of monitoring and complying with foreign
and international laws and treaties; and the burden of complying with and change in international taxation policies, as well as
the risks discussed under the heading "Risk Factors" in Luminex's Reports on Forms 10-K and 10-Q, as filed with the Securities
and Exchange Commission. The forward-looking statements, including the financial guidance and 2017 outlook, contained
herein represent the judgment of Luminex as of the date of this press release, and Luminex expressly disclaims any intent,
obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in
Luminex's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are
based.
LUMINEX CORPORATION
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(in thousands)
|
|
|
|
|
|
March 31,
|
|
December 31,
|
|
2017
|
|
2016
|
|
(unaudited)
|
|
|
ASSETS
|
|
|
|
Current assets:
|
|
|
|
Cash and cash equivalents
|
$ 86,466
|
|
$ 93,452
|
Accounts receivable, net
|
37,038
|
|
32,365
|
Inventories, net
|
43,673
|
|
40,775
|
Prepaids and other
|
6,304
|
|
7,145
|
Total current assets
|
173,481
|
|
173,737
|
Property and equipment, net
|
58,259
|
|
57,375
|
Intangible assets, net
|
82,485
|
|
84,841
|
Deferred income taxes
|
39,669
|
|
42,497
|
Goodwill
|
85,481
|
|
85,481
|
Other
|
7,237
|
|
6,785
|
Total assets
|
$ 446,612
|
|
$ 450,716
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
Current liabilities:
|
|
|
|
Accounts payable
|
$ 9,095
|
|
$ 12,276
|
Accrued liabilities
|
15,536
|
|
22,804
|
Deferred revenue
|
5,317
|
|
5,120
|
Total current liabilities
|
29,948
|
|
40,200
|
Deferred revenue
|
1,882
|
|
1,875
|
Other
|
4,914
|
|
4,962
|
Total liabilities
|
36,744
|
|
47,037
|
Stockholders' equity:
|
|
|
|
Common stock
|
43
|
|
43
|
Additional paid-in capital
|
335,786
|
|
336,430
|
Accumulated other comprehensive loss
|
(1,429)
|
|
(1,692)
|
Retained earnings
|
75,468
|
|
68,898
|
Total stockholders' equity
|
409,868
|
|
403,679
|
Total liabilities and stockholders' equity
|
$ 446,612
|
|
$ 450,716
|
LUMINEX CORPORATION
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
(in thousands, except per share amounts)
|
|
|
|
|
|
Three Months Ended
|
|
March 31,
|
|
2017
|
|
2016
|
|
(unaudited)
|
|
|
|
|
Revenue
|
$ 77,779
|
|
$ 62,981
|
Cost of revenue
|
24,993
|
|
18,175
|
Gross profit
|
52,786
|
|
44,806
|
Operating expenses:
|
|
|
|
Research and development
|
12,420
|
|
11,019
|
Selling, general and administrative
|
23,998
|
|
20,359
|
Amortization of acquired intangible assets
|
2,356
|
|
1,627
|
Total operating expenses
|
38,774
|
|
33,005
|
Income from operations
|
14,012
|
|
11,801
|
Other income, net
|
(6)
|
|
21
|
Income before income taxes
|
14,006
|
|
11,822
|
Income tax expense
|
(4,775)
|
|
(3,052)
|
Net income
|
$ 9,231
|
|
$ 8,770
|
|
|
|
|
Net income attributable to common stock holders
|
|
|
|
Basic
|
$ 9,058
|
|
$ 8,770
|
Diluted
|
$ 9,058
|
|
$ 8,770
|
Net income per share attributable to common stock holders
|
|
|
Basic
|
$ 0.21
|
|
$ 0.21
|
Diluted
|
$ 0.21
|
|
$ 0.21
|
Weighted-average shares used in computing net income per share
|
|
|
Basic
|
42,898
|
|
42,346
|
Diluted
|
42,989
|
|
42,443
|
|
|
|
|
Dividends declared per share
|
$ 0.06
|
|
-
|
LUMINEX CORPORATION
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in thousands)
|
|
|
|
|
|
Three Months Ended
|
|
March 31,
|
|
2017
|
|
2016
|
|
(unaudited)
|
Cash flows from operating activities:
|
|
|
|
Net income
|
$ 9,231
|
|
$ 8,770
|
Adjustments to reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation and amortization
|
5,619
|
|
4,212
|
Stock-based compensation
|
722
|
|
1,180
|
Deferred income tax expense
|
2,935
|
|
3,326
|
Loss (gain) on sale or disposal of assets
|
-
|
|
37
|
Other
|
444
|
|
(54)
|
Changes in operating assets and liabilities:
|
|
|
|
Accounts receivable, net
|
(4,669)
|
|
(548)
|
Inventories, net
|
(2,887)
|
|
102
|
Other assets
|
695
|
|
164
|
Accounts payable
|
(3,706)
|
|
(1,013)
|
Accrued liabilities
|
(10,072)
|
|
(8,721)
|
Deferred revenue
|
197
|
|
830
|
Net cash provided by operating activities
|
(1,491)
|
|
8,285
|
Cash flows from investing activities:
|
|
|
|
Purchase of property and equipment
|
(3,433)
|
|
(2,848)
|
Purchase of cost method investment
|
(500)
|
|
-
|
Acquired technology rights
|
-
|
|
(200)
|
Net cash used in investing activities
|
(3,933)
|
|
(3,048)
|
Cash flows from financing activities:
|
|
|
|
Proceeds from employee stock plans and issuance of common stock
|
734
|
|
356
|
Shares surrendered for tax withholding
|
(2,056)
|
|
-
|
Net cash provided by (used in) financing activities
|
(1,322)
|
|
356
|
Effect of foreign currency exchange rate on cash
|
(240)
|
|
163
|
Change in cash and cash equivalents
|
(6,986)
|
|
5,756
|
Cash and cash equivalents, beginning of period
|
93,452
|
|
128,546
|
Cash and cash equivalents, end of period
|
$ 86,466
|
|
$ 134,302
|
LUMINEX CORPORATION
|
NON-GAAP RECONCILIATION
|
(in thousands)
|
|
|
|
|
|
Three Months Ended
|
|
March 31,
|
|
2017
|
|
2016
|
|
(unaudited)
|
|
|
|
|
Income from operations
|
$ 14,012
|
|
$ 11,801
|
Stock-based compensation
|
722
|
|
1,180
|
Amortization of acquired intangible assets
|
2,356
|
|
1,627
|
Severance costs
|
|
|
654
|
Adjusted income from operations
|
$ 17,090
|
|
$ 15,262
|
Other income, net
|
(6)
|
|
21
|
Income tax expense
|
(4,775)
|
|
(3,052)
|
Income tax effect of above adjusting items
|
(146)
|
|
(53)
|
Adjusted net income
|
$ 12,163
|
|
$ 12,178
|
Adjusted net income per share, basic
|
$ 0.28
|
|
$ 0.29
|
Shares used in computing adjusted net income per share, basic
|
42,898
|
|
42,346
|
Adjusted net income per share, diluted
|
$ 0.28
|
|
$ 0.29
|
Shares used in computing adjusted net income per share, diluted
|
42,989
|
|
42,443
|
The Company makes reference in this release to "non-GAAP net income" which excludes stock-based compensation expense,
amortization of acquired intangible assets and the impact of costs associated with legal proceedings; which are unpredictable and
can vary significantly from period to period; and certain other recurring and non-recurring expenses. The Company believes that
excluding these items and their related tax effects from its financial results reflects operating results that are more
indicative of the Company's ongoing operating performance while improving comparability to prior periods, and, as such may
provide investors with an enhanced understanding of the Company's past financial performance and prospects for the future. In
addition, the Company's management uses such non-GAAP measures internally to evaluate and assess its core operations and to make
ongoing operating decisions. This information is not intended to be considered in isolation or as a substitute for income from
operations, net income, net income per share or expense information prepared in accordance with GAAP.
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SOURCE Luminex Corporation