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Trinity Biotech (TRIB) Announces Quarter 3 Financial Results  
10/20/2010 9:12:37 AM

DUBLIN, IRELAND--(Marketwire - October 20, 2010) - Trinity Biotech plc (NASDAQ: TRIB), a leading developer and manufacturer of diagnostic products for the point-of-care and clinical laboratory markets, today announced results for the quarter ended September 30, 2010.

Quarter 3 Results

Total revenues for the quarter were $18.7m which compares to $31.7m in quarter 3, 2009, a decrease of 40.9%. This decrease is principally due to the divestiture of the coagulation product line in Q2 2010.

Point-of-care revenues for the quarter increased by 8% when compared to quarter 3, 2009. This was due to improved sales in our two key markets of USA and Africa. Continuing clinical laboratory (i.e. excluding coagulation) revenues were $14.5m which represents a decrease of 8.9% when compared to quarter 3, 2009, which is attributable to the combined impact of moving to a distribution selling model in France, Germany and the UK following the coagulation divestiture and the weaker US Dollar. The impact of the slower Lyme season has been offset by modest organic growth in our Diabetes and Infectious Diseases product lines.

Revenues for quarter 3 by key product area were as follows:



                                          2009         2010        2010
                                       Quarter 3   Quarter 2    Quarter 3
                                     ------------ ------------ ------------
                                        US$ '000    US$ '000     US$ '000
                                     ------------ ------------ ------------
Point-of-Care                               3,891        4,011        4,202
                                     ------------ ------------ ------------
Continuing Clinical Laboratory             15,970       14,178       14,547
                                     ------------ ------------ ------------
Continuing operations*                     19,861       18,189       18,749
                                     ------------ ------------ ------------

                                     ------------ ------------ ------------
Coagulation                                11,844        4,437            0
                                     ------------ ------------ ------------

                                     ------------ ------------ ------------
Total                                      31,705       22,626       18,749
                                     ------------ ------------ ------------

* Continuing operations reflects the company's divestiture of its coagulation product line (shown separately)

Gross profit for the quarter amounted to $9.5m representing a gross margin of approximately 50.6%. This compares favourably to the gross margin of 45.0% for the same period in 2009. The improvement in gross margin of 5.6% is largely attributable to the divestiture of coagulation, which traditionally had been our lowest gross margin product line. Excluding instrument service costs for the quarter, the gross margin would be 52.1%.

Research and Development expenses for the quarter amounted to $0.8m, which represents a decrease of 58.9% compared to quarter 3, 2009. In the same period, SG&A expenses decreased by 34.5% from $8.7m in quarter 3 of 2009 to $5.7m in the current quarter. In both cases the principal driver for the reduction has been the transfer of R&D, sales and administrative personnel to Stago as part of the coagulation divestiture.

The Company recognised an exceptional charge of $587,000 in the quarter. This principally relates to certain working capital adjustments associated with the divestiture of coagulation to Stago. In accordance with the sale agreement, these adjustments were only determinable in the period following the closure of the deal. Taking into account these adjustments, the total reported profit on the coagulation divestiture decreased from $47.4m to $46.8m.

Net financial income for the quarter was $0.4m which compares to a net financial expense of $0.3m in quarter 3, 2009. This improvement is attributable to the elimination of bank debt and the increase in cash balances to $53.8m.

Operating profit was $3.3m for the quarter, representing a decrease of $0.4m compared to quarter 3, 2009. However, the operating margin for the quarter has increased to 17.4%, which represents a significant improvement compared to 11.8% in quarter 3, 2009.

Excluding the non-recurring item, profit after tax increased by 14.7% from $3.1m in quarter 3, 2009 to $3.5m this quarter. Similarly, EPS for the quarter increased from 14.6 cent per share to 16.5 cent per share, an increase of 13.0%.

The tax charge for the quarter was $0.2m which represents an effective tax rate of 6.6%.

The following table excludes the impact of the non-recurring items:




                                        2009          2010      Increase/
                                      Quarter 3    Quarter 3   (Decrease)
                                       US$'000      US$'000         %
                                    ------------ ------------ -----------
Profit before tax                          3,442        3,712         7.8%
                                    ------------ ------------ -----------
Income Tax expense                          (385)        (206)      (46.5%)
                                    ------------ ------------ -----------
Profit after tax                           3,057        3,506        14.7%
                                    ------------ ------------ -----------
Basic EPS - US cents                        14.6         16.5        13.0%
                                    ------------ ------------ -----------

From a cash perspective the Company generated $4.9m of cash from operations which is an increase of almost 20% compared with the same period in 2009. In quarter 3, 2010 the company generated free cash flows of $3.8m, compared to $2.1m for the corresponding quarter in 2009.

Share Buy-back

The Company intends to undertake a share buy-back program, though certain legal hurdles need to be cleared first. As an initial step, the Company held an Extraordinary General Meeting on 30 September, 2010 which approved transferring share premium to reserves in order to eliminate the Company's negative reserves. The Company is now seeking approval from the Irish Courts for this action, which if granted will allow the buy-back program to commence in December of this year.

Comments

Commenting on the results, Kevin Tansley, Chief Financial Officer, said, "The Company had a very strong third quarter. EPS of 16.5 cent represented an increase of 13% over the equivalent period last year. We also generated free cash flows of $3.8m, which brings our cash balance at the end of the quarter to over $53.8m. Taking into account the deferred consideration of $22.5m that we are due to receive over the next 18 months, the company effectively has cash resources of $76.3m or $3.59 per share."

Ronan O'Caoimh, CEO of Trinity Biotech, stated, "Quarter 3 represents our first full quarter without coagulation and has demonstrated that despite the divestiture, our EPS continues to grow, with this quarter's EPS reaching an all time high for the Company. Meanwhile from a strategic perspective we now have a very strong product development pipeline. Our new diabetes A1c instrument is due to launch in quarter 4 and the development of our new range of point-of-care tests in our research centres in San Diego and Ireland is progressing very well with first launches expected in 15 months."

Forward-looking statements in this release are made pursuant to the "safe harbor" provision of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties including, but not limited to, the results of research and development efforts, the effect of regulation by the United States Food and Drug Administration and other agencies, the impact of competitive products, product development commercialisation and technological difficulties, and other risks detailed in the Company's periodic reports filed with the Securities and Exchange Commission.

Trinity Biotech develops, acquires, manufactures and markets diagnostic systems, including both reagents and instrumentation, for the point-of-care and clinical laboratory segments of the diagnostic market. The products are used to detect infectious diseases and to quantify the level of Haemoglobin A1c and other chemistry parameters in serum, plasma and whole blood. Trinity Biotech sells direct in the United States, Germany, France and the U.K. and through a network of international distributors and strategic partners in over 75 countries worldwide. For further information please see the Company's website: www.trinitybiotech.com.




                           Trinity Biotech plc
                       Consolidated Income Statements




(US$000's  except
 share data)          Three Months   Three Months  Nine Months   NineMonths
                         Ended          Ended        Ended         Ended
                        Sept 30        Sept 30      Sept 30       Sept 30
                          2010           2009         2010          2009
                       (unaudited)   (unaudited)  (unaudited)   (unaudited)

Revenues                     18,749       31,705       70,388       95,113

Cost of sales                (9,262)     (17,434)     (36,215)     (51,789)
                        -----------  -----------  -----------  -----------

Gross profit                  9,487       14,271       34,173       43,324
Gross profit %                 50.6%        45.0%        48.5%        45.6%

Other operating income          651          143        1,234          415

Research & development
 expenses                      (758)      (1,843)      (3,750)      (5,400)
Selling, general and
 administrative
 expenses                    (5,721)      (8,729)     (20,426)     (27,341)
Indirect share based
 payments                      (392)        (111)        (779)        (384)
                        -----------  -----------  -----------  -----------

Operating profit              3,267        3,731       10,452       10,614

Non-recurring items            (587)           -       46,474            -

Financial income                514            -          792            4
Financial expenses              (69)        (289)        (426)        (929)
                        -----------  -----------  -----------  -----------
Net financing
 income/(expense)               445         (289)         366         (925)
                        -----------  -----------  -----------  -----------

Profit before tax             3,125        3,442       57,292        9,689

Income tax expense on
 operating activities          (206)        (385)        (888)      (1,123)
Income tax credit on
 non-recurring items              -            -          354            -
                        -----------  -----------  -----------  -----------
Profit for the period         2,919        3,057       56,758        8,566
                        -----------  -----------  -----------  -----------
Profit for the period
 (excluding
 non-recurring items)         3,506        3,057        9,930        8,566
                        -----------  -----------  -----------  -----------

Earnings per ADR (US
 cents)                        13.8         14.6        268.6         41.0
Earnings per ADR (US
 cents) - excluding
 non-recurring items           16.5         14.6         47.0         41.0

Diluted earnings per
 ADR (US cents)                13.5         14.5        263.9         41.0
Diluted earnings per
 ADR (US cents) -
 excluding
 non-recurring items           16.2         14.5         46.2         41.0

Weighted average no.
 of ADRs used in
 computing basic
 earnings per ADR        21,183,785   20,943,038   21,127,858   20,885,092



The above financial statements have been prepared in accordance with the
principles of International Financial Reporting Standards and the Company's
accounting policies but do not constitute an interim financial report as
defined in IAS 34 (Interim Financial Reporting).






                               Trinity Biotech plc
                           Consolidated Balance Sheets





                              Sept 30,   June  30,   March 31, December 31,
                                2010       2010         2010        2009
                             US$ '000     US$ '000    US$ '000    US$ '000
                            (unaudited) (unaudited) (unaudited)   (audited)

ASSETS
Non-current assets
Property, plant and
 equipment                       5,535       5,339      12,131      12,174
Goodwill and intangible
 assets                         36,120      35,127      46,247      44,822
Deferred tax assets              4,490       4,073       5,627       5,801
Other assets                    11,738      11,762       1,330       1,212
                            ----------  ----------  ----------  ----------
Total non-current assets        57,883      56,301      65,335      64,009
                            ----------  ----------  ----------  ----------

Current assets
Inventories                     18,758      18,064      40,033      39,198
Trade and other receivables     27,371      28,592      20,415      22,931
Income tax receivable              168         257         260         229
Cash and cash equivalents       53,802      50,042       6,222       6,078
                            ----------  ----------  ----------  ----------
Total current assets           100,099      96,955      66,930      68,436
                            ----------  ----------  ----------  ----------

                            ----------  ----------  ----------  ----------
TOTAL ASSETS                   157,982     153,256     132,265     132,445
                            ----------  ----------  ----------  ----------

EQUITY AND LIABILITIES
Equity attributable to the
 equity holders of the
 parent
Share capital                    1,087       1,083       1,080       1,080
Share premium                  161,220     160,817     160,739     160,683
Accumulated deficit            (29,483)    (32,811)    (83,717)    (87,070)
Translation reserve               (544)       (544)       (385)        206
Other reserves                   4,463       4,144       4,241       4,445
                            ----------  ----------  ----------  ----------
Total equity                   136,743     132,689      81,958      79,344
                            ----------  ----------  ----------  ----------

Current liabilities
Interest-bearing loans and
 borrowings                        265         246      13,429      12,625
Income tax payable                 366         148         207          24
Trade and other payables        12,831      12,241      11,732      12,844
Derivative Financial
 Instruments                        88         406         279          58
Provisions                          50          50          50          50
                            ----------  ----------  ----------  ----------
Total current liabilities       13,600      13,091      25,697      25,601
                            ----------  ----------  ----------  ----------

Non-current liabilities
Interest-bearing loans and
 borrowings                        205         294      16,409      19,231
Other payables                     519         607          38          59
Deferred tax liabilities         6,915       6,575       8,163       8,210
                            ----------  ----------  ----------  ----------
Total non-current
 liabilities                     7,639       7,476      24,610      27,500
                            ----------  ----------  ----------  ----------

                            ----------  ----------  ----------  ----------
TOTAL LIABILITIES               21,239      20,567      50,307      53,101
                            ----------  ----------  ----------  ----------

                            ----------  ----------  ----------  ----------
TOTAL EQUITY AND
 LIABILITIES                   157,982     153,256     132,265     132,445
                            ----------  ----------  ----------  ----------




The above financial statements have been prepared in accordance with the
principles of International Financial Reporting Standards and the Company's
accounting policies but do not constitute an interim financial report as
defined in IAS 34 (Interim Financial Reporting).





                               Trinity Biotech plc
                        Consolidated Statement of Cash Flows




(US$000's)             Three Months  Three Months  Nine Months  Nine Months
                           Ended        Ended        Ended        Ended
                          Sept 30,     Sept 30,     Sept 30,     Sept 30,
                           2010          2009         2010         2009
                         (unaudited) (unaudited)  (unaudited)  (unaudited)

Cash and cash
 equivalents at
 beginning of period         50,042        4,791        6,078        5,184

Operating cash flows
 before changes in
 working capital              5,260        4,701       14,586       13,710
Changes in Working
 Capital                       (332)        (584)       1,357       (3,060)
                        -----------  -----------  -----------  -----------
Cash generated from
 operations                   4,928        4,117       15,943       10,650

Net Interest and Income
 taxes paid                     347         (396)        (230)        (789)

Capital Expenditure
 (net)                       (1,515)      (1,600)      (4,950)      (5,987)

                        -----------  -----------  -----------  -----------
Free cash flow                3,760        2,121       10,763        3,874

Repayment of bank debt            -       (3,215)     (29,556)      (5,361)

Proceeds from sale of
 Coagulation Product
 Line                             -            -       66,517            -

                        -----------  -----------  -----------  -----------
Cash and cash
 equivalents at end of
 period                      53,802        3,697       53,802        3,697
                        -----------  -----------  -----------  -----------



The above financial statements have been prepared in accordance with the
principles of International Financial Reporting Standards and the Company's
accounting policies but do not constitute an interim financial report as
defined in IAS 34 (Interim Financial Reporting).


Contact:
Trinity Biotech plc
Kevin Tansley
(353)-1-2769800
E-mail: Email Contact

Lytham Partners LLC
Joe Diaz, Joe Dorame & Robert Blum
602-889-9700


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