Luminex Reports Fourth Quarter And Full Year 2014 Results

AUSTIN, Texas, Feb. 2, 2015 /PRNewswire/ -- Luminex Corporation (NASDAQ: LMNX) today announced financial results for the fourth quarter and year ended December 31, 2014.  Financial and operating highlights include the following:

• Consolidated fourth quarter revenue of $58.1 million, a 5 percent increase compared to the fourth quarter of 2013; full-year 2014 revenue was $227.0 million, a 6 percent increase over 2013.
• Consolidated gross profit margin was 74 percent for the fourth quarter, and 70 percent for the full year 2014. 
• Fourth quarter assay revenue of $24.1 million, a 34 percent increase over the fourth quarter of 2013; full-year 2014 assay revenue of $87.7 million, an 18 percent increase over 2013.
• GAAP net income for the fourth quarter and full-year of 2014 was $22.8 million and $39.0 million, or $0.53 and $0.92 per diluted share, respectively. Non-GAAP net income for the fourth quarter and full-year 2014 was $8.0 million and $37.8 million, or $0.19 and $0.90 per diluted share, respectively (see Non-GAAP reconciliation).

"During my first 100 days at Luminex, I have conducted a thorough strategic and operational review which has further confirmed my enthusiasm and confidence in the future success of the company. We have a portfolio of differentiated products, a large installed base of equipment, loyal customers and a solid financial position," said Homi Shamir, President and Chief Executive Officer of Luminex. "At the same time, we have certain challenges ahead of us, including ongoing pressure on consumable revenue resulting from inventory management needs of our largest partner and we anticipate pressure on our Cystic Fibrosis business due to a competitive technology." 

"We expect 2015 to be a transitional year for Luminex as we prepare to launch two transformational products - ARIES and NxTAG. During the fourth quarter, we completed the final stages of development for both and expect to begin clinical trials this quarter and to bring both to market in 2015. We are on our way to transforming the company into a key player in the molecular diagnostics space, and with a strong pipeline of products and a strong balance sheet, we are well positioned for accelerating growth in years to come."

Additional Financial Highlights:

• Fourth quarter shipments of 205 multiplexing analyzers, which included 76 MAGPIX systems, 94 LX systems, and 35 FLEXMAP 3D systems. Cumulative life-to-date multiplexing analyzer shipments are 11,687.
• During the quarter, there were 20 bulk purchases of consumables totaling $8.1 million, or 75 percent of total consumables.
• Royalty revenues reflect total royalty-bearing end user sales for the fourth quarter and full year 2014 of $111 million and $456 million, respectively.
• Infectious disease assay sales comprised approximately 67 percent of total assay sales for the quarter, with genetic testing assays representing 33 percent.
• During the full year 2014, the company released a portion of the valuation allowance on deferred tax assets in Canada, benefitted from the closure of our Australian facility, and established a tax asset associated with tax paid on intercompany profits.  The tax benefit of these items totaled $19.0 million, giving us a pro forma effective tax rate of 29%.
• Operating income for the fourth quarter and full year of 2014 was $10.2 million and $28.1 million, respectively. Non-GAAP operating income for the fourth quarter and full year 2014 was $14.9 million and $49.1 million, respectively (see Non-GAAP reconciliation).
• Cash and investments balance at year-end totaled $107.7 million.
• Days sales outstanding (DSO) was 46 days at year-end, while days payable outstanding (DPO) was 71 days at year-end.
• Moving forward, the Company will no longer present two segments, but will return to presenting one consolidated reporting unit. This change in financial reporting aligns with management's view of the business and its operational structure.

FINANCIAL OUTLOOK AND GUIDANCE

The Company intends to provide annual revenue guidance, to be updated, as appropriate, at each quarterly reporting period. Guidance for fiscal 2015 is as follows:

• The Company expects fiscal 2015 revenue to be between $230 million and $236 million.
• For 2015, the Company expects consumable revenue to continue to be under pressure due to inventory management challenges by its largest partner.
• In addition, the 2015 guidance reflects conservative estimates for the Cystic Fibrosis portion of Assay revenue, given the potential impact of a competitive technology.
• The company anticipates first quarter 2015 revenue to be between $55 million and $58 million.

CONFERENCE CALL

Management will host a conference call to discuss the operating highlights and financial results for the fourth quarter ended December 31, 2014, at 3:30 p.m. CST/4:30 p.m. EST, Monday, February 2, 2015. 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. 

To read full press release, please click here.

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