Luminex Corporation Reports Second Quarter 2018 Financial Results

Published: Aug 06, 2018

 

AUSTIN, Texas, Aug. 6, 2018 /PRNewswire/ -- Luminex Corporation (Nasdaq:LMNX) today announced financial results for the second quarter of 2018. Financial and operating highlights for the quarter include:

  • Second quarter 2018 consolidated revenue was $79.6 million, an increase of 4% compared to the second quarter 2017.
  • Second quarter 2018 GAAP net income was $5.7 million, an increase of 2% compared to the second quarter 2017. GAAP net income per diluted share was $0.13 for the second quarter 2018 and 2017.
  • Assay revenue was $40.2 million for the quarter ended June 30, 2018, representing a 6% increase over assay revenue for the second quarter 2017.
  • Total sample-to-answer molecular product revenue for the second quarter of 2018 was $14.2 million, representing growth of 33% compared to $10.7 million in the second quarter of 2017.
  • Placed 65 sample-to-answer molecular systems under contract during the second quarter of 2018, compared to 35 in the second quarter of 2017. Total active sample-to-answer customers now number over 500.
  • Sample-to-answer utilization per VERIGENE® customer grew approximately 16%, to $108,000 from $93,000 in the prior year quarter; and utilization per ARIES® customer grew approximately 43%, to $53,000 from $37,000 in the prior year quarter.
  • 361 multiplexing analyzers were shipped during the quarter; a combination of MAGPIX® systems, LX systems, and FLEXMAP 3D® systems. This contrasts to 270 multiplexing analyzers shipped in the prior year quarter.
  • Total cash at the end of the quarter was approximately $139 million after payment of the quarterly dividend.

"I am pleased with our continued success throughout our diversified business," said Homi Shamir, President and Chief Executive Officer of Luminex. "Our sample-to-answer portfolio increasing by more than 30% from the same quarter last year; and with another 65 contracted systems during the quarter, the Company has solidified the foundation for increasing growth. Within our Licensed Technologies Group, the Company had a record number of xMAP® system placements for the quarter, and we are well on our way to exceeding the total placements in 2017. The Company also made significant strides within our product pipeline during the quarter, moving our Next Gen xMAP® system into the Development Phase, and initiating clinical trials for VERIGENE® II. We are committed to investing in the rapid development of our product pipeline across our entire business and leading innovation within our field."

                              REVENUE SUMMARY

                     (in thousands, except percentages)


                     Three Months Ended

                          June 30,                        Variance
                          --------                        --------

                        2018                         2017          ($)         (%)
                        ----                         ----          ---         ---

                       (unaudited)


    System sales     $11,820                       $9,905               $1,915       19%

    Consumable sales  10,967                       13,310              (2,343)     -18%

    Royalty revenue   11,567                       10,813                  754        7%

    Assay revenue     40,174                       37,753                2,421        6%

    Service revenue    3,041                        2,795                  246        9%

    Other revenue      2,009                        1,881                  128        7%

                     $79,578                      $76,457               $3,121        4%
                     =======                      =======               ======       ===

FINANCIAL OUTLOOK AND GUIDANCE

The Company intends to provide annual revenue guidance, to be updated, as appropriate, at each quarterly reporting period. Luminex anticipates third quarter 2018 revenue to be between $72.5 million and $74.5 million, taking into account the departure of LabCorp Women's Health, and reaffirms its full year 2018 revenue guidance of between $310 million and $316 million.

CONFERENCE CALL

Management will host a conference call at 3:30 p.m. CDT / 4:30 p.m. EDT, Monday, August 6, 2018 to discuss the operating highlights and financial results for the second quarter 2018. 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 and projected 2018 performance, including revenue guidance. 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, 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 internal resource planning challenges; market demand and acceptance of Luminex's products and technology, including ARIES®, MultiCode®, xMAP®, VERIGENE® and NxTAG® products; Luminex's ability to scale manufacturing operations and manage operating expenses, gross margins and inventory levels; Luminex's ability to obtain and enforce intellectual property protections on Luminex's products and technologies; the impact on Luminex's growth and future results of operations with respect to the loss of the LabCorp women's health business anticipated in June 2018; Luminex's ability to successfully launch new products in a timely manner; dependence on strategic partners for development, commercialization and distribution of products; risks and uncertainties associated with implementing Luminex's acquisition strategy, Luminex's challenge to identify acquisition targets, including Luminex's ability to obtain financing on acceptable terms; Luminex's ability to integrate acquired companies or selected assets into Luminex's consolidated business operations, and the ability to fully realize the benefits of Luminex's acquisitions; the timing of and process for regulatory approvals; competition and competitive technologies utilized by Luminex's competitors; 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 comply with applicable laws, regulations, policies and procedures; the impact of the ongoing uncertainty in global finance markets and changes in governmental and governmental agency funding, including effects on the capital spending policies of Luminex's partners and end users and their ability to finance purchases of Luminex's products; changes in interpretation, assumptions and expectations regarding the Tax Cuts and Jobs Act, including additional guidance that may be issued by federal and state taxing authorities; 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; 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; 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; Luminex's ability to monitor and comply with foreign and international laws and treaties; and Luminex's ability to comply with changes in international taxation policies; 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; reliance on third party distributors for distribution of specific Luminex-developed and manufactured assay products, 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 2018 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.

    Contacts: Harriss T. Currie                                       David Carey

              Sr. Vice President, Finance and Chief Financial Officer Investor Relations, Lazar Partners

              512-219-8020                                            212-867-1768

              hcurrie@luminexcorp.com                                 dcarey@lazarpartners.com

 

                                                        LUMINEX CORPORATION

                                               CONDENSED CONSOLIDATED BALANCE SHEETS

                                                           (in thousands)


                                                                                       June 30,           December 31,

                                                                                                     2018                  2017
                                                                                                     ----                  ----

                                                                                     (unaudited)

    ASSETS

    Current assets:

    Cash and cash equivalents                                                                    $138,996              $127,112

    Accounts receivable, net                                                                       46,778                40,648

    Inventories, net                                                                               52,085                49,478

    Prepaids and other                                                                              7,984                 7,403
                                                                                                    -----                 -----

    Total current assets                                                                          245,843               224,641

    Property and equipment, net                                                                    59,642                58,258

    Intangible assets, net                                                                         71,653                75,985

    Deferred income taxes                                                                          32,538                37,552

    Goodwill                                                                                       85,481                85,481

    Other                                                                                          15,071                 8,599

    Total assets                                                                                 $510,228              $490,516
                                                                                                 ========              ========


    LIABILITIES AND STOCKHOLDERS' EQUITY

    Current liabilities:

    Accounts payable                                                                              $12,599               $14,537

    Accrued liabilities                                                                            18,236                25,990

    Deferred revenue                                                                                5,546                 4,721

    Total current liabilities                                                                      36,381                45,248

    Deferred revenue                                                                                1,326                 1,498

    Other                                                                                           6,992                 5,863
                                                                                                    -----                 -----

    Total liabilities                                                                              44,699                52,609
                                                                                                   ------                ------

    Stockholders' equity:

    Common stock                                                                                       44                    43

    Additional paid-in capital                                                                    357,076               350,834

    Accumulated other comprehensive loss                                                            (944)                (625)

    Retained earnings                                                                             109,353                87,655
                                                                                                  -------                ------

    Total stockholders' equity                                                                    465,529               437,907

    Total liabilities and stockholders' equity                                                   $510,228              $490,516
                                                                                                 ========              ========

 

                                                                              LUMINEX CORPORATION

                                                                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

                                                                    (in thousands, except per share amounts)


                                                                                                            Three Months Ended             Six Months Ended

                                                                                                                 June 30,                      June 30,
                                                                                                               --------                   --------

                                                                                                               2018                2017                   2018       2017
                                                                                                               ----                ----                   ----       ----

                                                                                                              (unaudited)               (unaudited)


    Revenue                                                                                                 $79,578             $76,457               $162,240   $154,236

    Cost of revenue                                                                                          30,272              26,396                 59,346     51,389

    Gross profit                                                                                             49,306              50,061                102,894    102,847

    Operating expenses:

    Research and development                                                                                 11,672              12,260                 21,998     24,680

    Selling, general and administrative                                                                      27,610              28,153                 53,440     52,150

    Amortization of acquired intangible assets                                                                2,166               2,166                  4,332      4,523

    Total operating expenses                                                                                 41,448              42,579                 79,770     81,353
                                                                                                             ------              ------                 ------     ------

    Income from operations                                                                                    7,858               7,482                 23,124     21,494

    Other income, net                                                                                             8                   1                    457        (5)

    Income before income taxes                                                                                7,866               7,483                 23,581     21,489

    Income tax benefit (expense)                                                                            (2,197)            (1,939)               (4,515)   (6,714)
                                                                                                             ------              ------                 ------     ------

    Net income                                                                                               $5,669              $5,544                $19,066    $14,775
                                                                                                             ======              ======                =======    =======


    Net income attributable to common stock holders

    Basic                                                                                                    $5,571              $5,441                $18,741    $14,499

    Diluted                                                                                                  $5,571              $5,441                $18,741    $14,499

    Net income per share attributable to common stock holders

    Basic                                                                                                     $0.13               $0.13                  $0.43      $0.34

    Diluted                                                                                                   $0.13               $0.13                  $0.43      $0.34

    Weighted-average shares used in computing net income per share

    Basic                                                                                                    43,734              43,160                 43,599     43,030

    Diluted                                                                                                  44,246              43,259                 43,871     43,128


    Dividends declared per share                                                                              $0.06                0.06                  $0.12       0.12

 

                                                         LUMINEX CORPORATION

                                           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                            (in thousands)


                                                                      Three Months Ended                Six Months Ended

                                                                           June 30,                         June 30,
                                                                          --------                      --------

                                                                          2018                     2017                  2018       2017
                                                                          ----                     ----                  ----       ----

                                                                   (unaudited)             (unaudited)

    Cash flows from operating activities:

    Net income                                                          $5,669                   $5,544               $19,066    $14,775

    Adjustments to reconcile net income to net cash provided by
     operating activities:

    Depreciation and amortization                                        6,130                    5,651                12,023     11,270

    Stock-based compensation                                             3,547                    4,026                 4,808      4,748

    Deferred income tax expense                                          2,308                    4,332                 3,761      7,267

    Loss (gain) on sale or disposal of
     assets                                                                111                        -                  111          -

    Other                                                              (1,158)                     478               (1,127)       922

    Changes in operating assets and liabilities:

    Accounts receivable, net                                             (503)                   3,911                 5,053      (758)

    Inventories, net                                                       133                  (3,417)              (2,602)   (6,304)

    Other assets                                                         (353)                 (1,892)                (556)   (1,197)

    Accounts payable                                                   (1,981)                   1,337               (1,661)   (2,369)

    Accrued liabilities                                                  3,366                    2,661               (8,073)   (7,411)

    Deferred revenue                                                       231                    (547)                  653      (350)
                                                                           ---                     ----                   ---       ----

    Net cash provided by operating
     activities                                                         17,500                   22,084                31,456     20,593
                                                                        ------                   ------                ------     ------

    Cash flows from investing activities:

    Purchase of property and equipment                                 (4,968)                 (2,970)              (9,036)   (6,403)

    Issuance of note receivable                                          (500)                       -              (1,000)         -

    Purchase of investment                                             (1,782)                   (500)              (1,782)   (1,000)

    Acquired technology rights                                               -                       -              (4,000)         -

    Net cash used in investing activities                              (7,250)                 (3,470)             (15,818)   (7,403)
                                                                        ------                   ------               -------     ------

    Cash flows from financing activities:

    Proceeds from issuance of common
     stock                                                               2,290                    1,495                 3,416      2,229

    Shares surrendered for tax
     withholding                                                          (13)                    (40)              (2,016)   (2,096)

    Dividends                                                          (2,678)                 (2,636)              (5,302)   (2,636)

    Net cash used in financing activities                                (401)                 (1,181)              (3,902)   (2,503)
                                                                          ----                   ------                ------     ------

    Effect of foreign currency exchange
     rate on cash                                                          492                    (194)                  148      (434)

    Change in cash and cash equivalents                                 10,341                   17,239                11,884     10,253

    Cash and cash equivalents, beginning
     of period                                                         128,655                   86,466               127,112     93,452
                                                                       -------                   ------               -------     ------

    Cash and cash equivalents, end of
     period                                                           $138,996                 $103,705              $138,996   $103,705
                                                                      ========                 ========              ========   ========

 

                   LUMINEX CORPORATION

                 NON-GAAP RECONCILIATION

                      (in thousands)


                  Three Months Ended              Six Months Ended

                       June 30,                       June 30,
                     --------                    --------

                    2018                   2017                  2018     2017
                    ----                   ----                  ----     ----

                   (unaudited)                  (unaudited)


     Reported
     Net
     Income       $5,669                 $5,544               $19,066  $14,775

     Severance
     &
     costs
     associated
     with
     legal
     proceedings     104                    559                   124      658

    Income
     tax
     effect
     of
     above
     adjusting
     items          (17)                 (145)                 (20)   (179)

    Income
     tax
     effect
     from
     discrete
     tax
     items           925                      -              (1,607)       -

     Adjusted
     Net
     Income       $6,681                 $5,958               $17,563  $15,254
                  ======                 ======               =======  =======


     Adjusted
     net
     income
     per
     share,
     basic         $0.15                  $0.14                 $0.40    $0.35
                   =====                  =====                 =====    =====

    Shares
     used
     in
     computing
     adjusted
     net
     income
     per
     share,
     basic        43,734                 43,160                43,599   43,030

     Adjusted
     net
     income
     per
     share,
     diluted       $0.15                  $0.14                 $0.40    $0.35
                   =====                  =====                 =====    =====

    Shares
     used
     in
     computing
     adjusted
     net
     income
     per
     share,
     diluted      44,246                 43,259                43,871   43,128

The Company's "non-GAAP net income" excludes costs associated with legal proceedings, acquisition costs, severance costs, and the impact of restructuring costs; some of 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.

 

View original content with multimedia:http://www.prnewswire.com/news-releases/luminex-corporation-reports-second-quarter-2018-financial-results-300692553.html

SOURCE Luminex Corporation

Company Codes: NASDAQ-NMS:LMNX

Back to news