Consolidated revenue of $74.1 million, an increase of 4% compared to the third quarter 2016.
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AUSTIN, Texas, Oct. 30, 2017 /PRNewswire/ -- Luminex Corporation (Nasdaq: LMNX) today announced financial results for the third quarter of 2017. Financial and operating highlights for the quarter include the following:
"The tremendous momentum in our sample-to-answer molecular business drove the Company's performance this quarter. Our VERIGENE and ARIES systems are experiencing excellent traction in the market resulting from a combination of factors, including their ease of use, a rapidly expanding FDA cleared test menu, differentiated pricing strategies, and a large, fully integrated sales and support team," said Homi Shamir, President and Chief Executive Officer of Luminex. "We remain enthusiastic about our diversified business model, our solid balance sheet, positive cash flow profile, and the significant future growth opportunities in both our Licensed Technologies Group and our molecular diagnostics business." REVENUE SUMMARY
(in thousands, except percentages)
Three Months Ended
September 30, Variance
------------- --------
2017 2016 ($) (%)
---- ---- --- ---
(unaudited)
System
sales $9,903 $10,494 $(591) -6%
Consumable
sales 10,619 12,305 (1,686) -14%
Royalty
revenue 11,001 11,068 (67) -1%
Assay
revenue 37,917 32,443 5,474 17%
Service
revenue 2,894 2,934 (40) -1%
Other
revenue 1,802 1,977 (175) -9%
$74,136 $71,221 $2,915 4%
======= ======= ====== ===
Nine Months Ended
September 30, Variance
------------- --------
2017 2016 ($) (%)
---- ---- --- ---
(unaudited)
System
sales $28,309 $27,805 $504 2%
Consumable
sales 39,314 37,489 1,825 5%
Royalty
revenue 33,375 33,888 (513) -2%
Assay
revenue 113,077 85,367 27,710 32%
Service
revenue 8,594 7,892 702 9%
Other
revenue 5,703 5,927 (224) -4%
$228,372 $198,368 $30,004 15%
======== ======== ======= ===
FINANCIAL OUTLOOK AND GUIDANCE The Company reaffirms its guidance for the full year and expects fourth quarter 2017 revenue to be between $76 million to $78 million. CONFERENCE CALL Management will host a conference call at 3:30 p.m. CDT / 4:30 p.m. EDT, Monday, October 30, 2017 to discuss the operating highlights and financial results for the third quarter 2017 ended September 30, 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, 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)
September 30, December 31,
2017 2016
---- ----
(unaudited)
ASSETS
Current assets:
Cash and cash
equivalents $110,911 $93,452
Accounts
receivable,
net 36,432 32,365
Inventories,
net 46,114 40,775
Prepaids and
other 9,915 7,145
----- -----
Total current
assets 203,372 173,737
Property and
equipment,
net 57,686 57,375
Intangible
assets, net 78,152 84,841
Deferred
income taxes 45,943 42,497
Goodwill 85,481 85,481
Other 8,094 6,785
Total assets $478,728 $450,716
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts
payable $7,813 $12,276
Accrued
liabilities 21,175 22,804
Deferred
revenue 5,123 5,120
Total current
liabilities 34,111 40,200
Deferred
revenue 1,609 1,875
Other 4,828 4,962
----- -----
Total
liabilities 40,548 47,037
------ ------
Stockholders' equity:
Common stock 43 43
Additional
paid-in
capital 345,663 336,430
Accumulated
other
comprehensive
loss (817) (1,692)
Retained
earnings 93,291 68,898
------ ------
Total
stockholders'
equity 438,180 403,679
Total
liabilities
and
stockholders'
equity $478,728 $450,716
======== ========
LUMINEX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2017 2016 2017 2016
---- ---- ---- ----
(unaudited) (unaudited)
Revenue $74,136 $71,221 $228,372 $198,368
Cost of revenue 28,317 25,556 79,706 62,976
Gross profit 45,819 45,665 148,666 135,392
Operating expenses:
Research and development 10,670 12,762 35,350 35,324
Selling, general and
administrative 26,454 26,393 78,604 70,942
Amortization of acquired
intangible assets 2,166 2,482 6,689 5,797
Total operating expenses 39,290 41,637 120,643 112,063
------ ------ ------- -------
Income from operations 6,529 4,028 28,023 23,329
Other income, net (1) 30 (6) (1,395)
Income before income taxes 6,528 4,058 28,017 21,934
Income tax benefit
(expense) 11,085 (1,307) 4,371 (4,760)
------ ------ ----- ------
Net income $17,613 $2,751 $32,388 $17,174
======= ====== ======= =======
Net income attributable to common stock holders
Basic $17,299 $2,751 $31,789 $17,174
Diluted $17,299 $2,751 $31,789 $17,174
Net income per share attributable to common stock holders
Basic $0.40 $0.06 $0.74 $0.40
Diluted $0.40 $0.06 $0.74 $0.40
Weighted-average shares used in computing net income per share
Basic 43,164 42,683 43,110 42,522
Diluted 43,266 43,136 43,216 42,929
Dividends declared per
share $0.06 - $0.18 -
LUMINEX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2017 2016 2017 2016
---- ---- ---- ----
(unaudited) (unaudited)
Cash flows from operating activities:
Net income $17,613 $2,751 $32,388 $17,174
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization 5,609 5,913 16,879 14,401
Stock-based compensation 3,829 3,526 8,577 8,181
Deferred income tax expense (10,379) 1,540 (3,112) 4,471
Loss (gain) on sale or disposal of
assets 417 87 417 128
Other 357 (799) 1,279 (870)
Changes in operating assets and liabilities:
Accounts receivable, net (3,295) (3,118) (4,053) 3,555
Inventories, net 988 (2,125) (5,316) (6,165)
Other assets (1,564) (902) (2,761) (230)
Accounts payable (2,163) (1,674) (4,532) 1,050
Accrued liabilities 2,273 (428) (5,138) (6,602)
Deferred revenue 81 112 (269) 733
--- --- ---- ---
Net cash provided by operating
activities 13,766 4,883 34,359 35,826
------ ----- ------ ------
Cash flows from investing activities:
Sales and maturities of available-
for-sale securities - - - 19,491
Purchase of property and equipment (3,981) (2,675) (10,384) (8,394)
Proceeds from sale of assets 1 42 1 45
Business acquisition consideration,
net of cash acquired - (1,196) - (68,098)
Issuance of note receivable (700) - (700) -
Purchase of cost method investment - (500) (1,000) (500)
Acquired technology rights (60) - (60) (200)
Net cash used in investing activities (4,740) (4,329) (12,143) (57,656)
------ ------ ------- -------
Cash flows from financing activities:
Payments on debt - - - (25,000)
Proceeds from issuance of common
stock 1,005 1,799 3,234 3,561
Shares surrendered for tax
withholding (28) (13) (2,124) (1,497)
Dividends (2,645) - (5,281) -
Net cash (used in) provided by
financing activities (1,668) 1,786 (4,171) (22,936)
------ ----- ------ -------
Effect of foreign currency exchange
rate on cash (152) 87 (586) 365
Change in cash and cash equivalents 7,206 2,427 17,459 (44,401)
Cash and cash equivalents, beginning
of period 103,705 81,718 93,452 128,546
------- ------ ------ -------
Cash and cash equivalents, end of
period $110,911 $84,145 $110,911 $84,145
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LUMINEX CORPORATION
NON-GAAP RECONCILIATION
(in thousands)
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
2017 2016 2017 2016
---- ---- ---- ----
(unaudited) (unaudited)
Income from operations $6,529 $4,028 $28,023 $23,329
Stock-based
compensation 3,829 3,526 8,577 8,181
Amortization of
acquired intangible
assets 2,166 2,482 6,689 5,797
Acquisition costs - 479 - 2,487
Severance costs 243 126 901 940
Adjusted income from
operations $12,767 $10,641 $44,190 $40,734
Other income, net (1) 30 (6) (1,395)
Acquisition costs - - - 1,500
Income tax expense 11,085 (1,307) 4,371 (4,760)
Income tax effect of
above adjusting items (761) (305) (2,053) (721)
Income tax benefit
from discrete tax
items (12,400) (12,400)
Adjusted net income $10,690 $9,059 $34,102 $35,358
======= ====== ======= =======
Adjusted net income
per share, basic $0.25 $0.21 $0.79 $0.83
===== ===== ===== =====
Shares used in
computing adjusted
net income per share,
basic 43,164 42,683 43,110 42,522
Adjusted net income
per share, diluted $0.25 $0.21 $0.79 $0.82
===== ===== ===== =====
Shares used in
computing adjusted
net income per share,
diluted 43,266 43,136 43,216 42,929
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; 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. Contacts: Harriss T. Currie Matthew Scalo
Sr. Vice President, Finance and Chief Financial Officer Sr. Director, Investor Relations
512-219-8020 512-219-8020
hcurrie@luminexcorp.com mscalo@luminexcorp.com
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Company Codes: NASDAQ-NMS:LMNX |
