Oxford Immunotec Reports Second Quarter 2016 Financial Results
- Second quarter revenue of $19.2 million, increased 34% compared to prior year period
- Raising revenue guidance for the full year from $79.5-$82.5 million to $82.5-$84.5 million
- Completed acquisition of Imugen, Inc. on July 1, 2016 for $22.2 million in all cash deal, accelerating entry into tick-borne disease testing market
OXFORD, United Kingdom and MARLBOROUGH, Mass., Aug. 02, 2016 (GLOBE NEWSWIRE) -- Oxford Immunotec Global PLC (Nasdaq:OXFD), a global, high-growth diagnostics company focused on developing and commercializing proprietary tests for the management of immune-regulated conditions, today announced second quarter 2016 financial results.
“We are very pleased with our financial and operating results during the second quarter,” said Dr. Peter Wrighton-Smith, Chief Executive Officer of Oxford Immunotec. "Sales performance exceeded our expectations, with solid growth coming from the United States, China and Japan. Additionally, we are tremendously excited about the recent acquisition of Imugen, which accelerates our entry into the tick-borne disease market and marks a significant advance in our goal of becoming a leader in the field of immune-regulated conditions.”
By revenue type, total revenues were, in millions:
| Three Months Ended June 30, | ||||||||||||
| 2016 | 2015 | Percent Change | ||||||||||
| Product | $ | 9.3 | $ | 6.6 | 41 | % | ||||||
| Service | 9.9 | 7.7 | 29 | % | ||||||||
| Total Revenue | $ | 19.2 | $ | 14.3 | 34 | % | ||||||
By geography, total revenues were, in millions:
| Three Months Ended June 30, | ||||||||||||||||
| Percent Change | ||||||||||||||||
| 2016 | 2015 | As Reported | Constant Currency Basis | |||||||||||||
| United States | $ | 9.8 | $ | 7.3 | 34 | % | 34 | % | ||||||||
| Europe & ROW | 2.0 | 1.9 | 2 | % | 6 | % | ||||||||||
| Asia | 7.4 | 5.1 | 47 | % | 37 | % | ||||||||||
| Total revenue | $ | 19.2 | $ | 14.3 | 34 | % | 32 | % | ||||||||
Changes in revenue include the impact of changes in foreign currency exchange rates. We use the non-GAAP financial measure “constant currency basis” in our filings to show changes in our revenue without giving effect to period-to-period currency fluctuations. We consider the use of a period over period revenue comparison on a constant currency basis to be helpful to investors, as it provides a revenue growth measure free of positive or negative volatility due to currency fluctuations.
Second Quarter 2016 Financial Results
Revenue for the second quarter of 2016 was $19.2 million, representing 34% growth over the second quarter 2015 revenue of $14.3 million. On a constant currency basis, revenue growth was 32% versus the prior year period.
2016 second quarter product revenue was $9.3 million representing a 41% increase from product revenue of $6.6 million in the second quarter of 2015. The increase in product revenue was primarily attributable to growth in Asia. Service revenue for the second quarter of 2016 was $9.9 million, up 29% from 2015 second quarter revenue of $7.7 million. The increase in service revenue was primarily driven by volume increases in the United States.
United States revenue was $9.8 million in the second quarter of 2016 representing 34% growth over the same period's revenue of $7.3 million in the prior year. Growth was driven primarily by volume increases in the institutional and patient testing segments.
Europe & ROW revenue was $2.0 million in the second quarter of 2016 representing a 2% increase compared to the second quarter of 2015. On a constant currency basis, Europe & ROW increased 6% versus the second quarter of 2015.
Asia revenue was $7.4 million in the second quarter of 2016 representing 47% growth over 2015 second quarter revenue of $5.1 million. On a constant currency basis, Asia grew 37% versus the second quarter of 2015. The increase was driven by continued strong growth in China and Japan.
Gross profit for the second quarter of 2016 was $10.5 million, an increase of $2.8 million over gross profit of $7.8 million in the same period of 2015. Gross margin was 55.1%, an increase of 70 basis points from the gross margin of 54.4% in the second quarter of 2015. The increase in gross margin was primarily due to lower kit costs associated with increased volume, product mix and the favorable impact of exchange rates on average selling prices, partially offset by costs associated with new service initiatives.
Operating expenses were $17.9 million in the second quarter of 2016, an increase of $3.5 million compared to $14.4 million in the same period last year. The increase in operating expenses was primarily due to headcount increases related to both sales and marketing and general and administrative functions, clinical costs and legal expenses.
Net loss for the second quarter of 2016 was $6.4 million, or $0.29 per share, compared to $7.3 million, or $0.33 per share, in the second quarter of 2015. Net loss per share was based on 22,351,645 and 22,245,682 weighted average ordinary shares outstanding for the second quarters of 2016 and 2015, respectively.
EBITDA for the second quarter of 2016 was $(5.8) million compared to $(6.8) million in the second quarter of 2015. Adjusted EBITDA was $(5.3) million for the second quarter of 2016 compared to $(6.5) million in the same period in 2015. Both EBITDA and Adjusted EBITDA are non-GAAP measures.
Cash and cash equivalents were $64.0 million as of June 30, 2016 compared to $68.7 million as of March 31, 2016. Cash usage during the quarter was in line with expectations.
Imugen Acquisition
On July 1, 2016, the Company completed the acquisition of substantially all of the assets of Imugen, a Massachusetts-based clinical laboratory focused on developing and performing specialized testing for tick-borne diseases, for $22.2 million in an all cash transaction.
Business Outlook
We expect to report full year 2016 revenue of between $82.5 and $84.5 million as compared to our prior guidance of between $79.5 and $82.5 million.
We expect to report revenue of between $24.2 and $25.0 million for the third quarter of 2016.
We expect to have approximately $30 million in cash at the end of 2016, which will give the Company cash into the second half of 2018 based on our current operating plan.
Conference Call
Oxford Immunotec will host a conference call on Tuesday, August 2, 2016 at 8:00 a.m. Eastern Time to discuss its second quarter 2016 financial results. The call will be concurrently webcast. To listen to the conference call on your telephone please dial (855) 363-5047 for United States callers and +1 (484) 365-2897 for international callers and reference confirmation code 47066686 approximately ten minutes prior to start time. To access the live audio webcast or subsequent archived recording, visit the Investor Relations section of Oxford Immunotec's website at www.oxfordimmunotec.com. The replay will be available on the Company's website for approximately 60 days.
About Oxford Immunotec
Oxford Immunotec Global PLC is a global, high-growth diagnostics company focused on developing and commercializing proprietary tests for the management of immune-regulated conditions. The Company's first product is the T-SPOT®.TB test, which is used to test for tuberculosis infection. The T-SPOT.TB test has been approved for sale in over 50 countries, including the United States, where it has received pre-market approval from the Food and Drug Administration, Europe, where it has obtained a CE mark, as well as Japan and China. The T-SPOT.CMV test and the T-SPOT.PRT test are the Company's second and third products and part of a series of products intended for the transplantation market. In addition to these three products, the Company has additional active development programs, each of which leverages our T cell, B cell and innate immune measuring technology. The Company is headquartered near Oxford, U.K. and in Marlborough, Mass. Additional information can be found at www.oxfordimmunotec.com.
T-SPOT and the Oxford Immunotec logo are trademarks of Oxford Immunotec Ltd.
Forward-Looking Statements
This release contains forward-looking statements, including statements regarding future revenues, expenses and the prospects for sales of our products. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. These risks and uncertainties include, among others, decisions by regulatory authorities, hospitals and other health care institutions, laboratories, physicians, patients and third party payers, as well as our ability to expeditiously and successfully expand our sales and distribution networks and the other factors described under the "Risk Factors" section in our filings with the Securities and Exchange Commission. When evaluating Oxford Immunotec's business and securities, investors should give careful consideration to these risks and uncertainties.
Forward-looking statements are based on current expectations and assumptions and currently available data and are neither predictions nor guarantees of future events or performance. You should not place undue reliance on forward-looking statements, which speak only as of the date of this presentation. We do not undertake to update or revise any forward-looking statements after they are made, whether as a result of new information, future events, or otherwise, except as required by applicable law.