Luminex Corporation Reports Fourth Quarter and Full-Year 2019 Results
AUSTIN, Texas, Feb. 10, 2020 /PRNewswire/ -- Luminex Corporation (Nasdaq: LMNX) today announced results for its fourth quarter and full-year ended December 31, 2019.
All amounts in this release are in conformity with U.S. generally accepted accounting principles ("GAAP").
CURRENT HIGHLIGHTS
-- Total revenue for the fourth quarter of $90.5M, a 12% increase over Q4
2018.
-- Total revenue for the year of $334.6M, up 6% over 2018; and up 19%
without consideration of LabCorp revenue and including the effect of the
Flow Cytometry acquisition.
-- Income and cash flow from operations in the fourth quarter increased to
$3.0M and $5.3M, respectively.
-- Submitted VERIGENE(® )II Gastrointestinal Flex Assay to the FDA in the
fourth quarter of 2019.
-- Expect to submit VERIGENE(® )II Respiratory Flex Assay to the FDA in
the first quarter of 2020.
CEO COMMENTARY
"Our successful transformation continues. We delivered a strong fourth quarter by growing revenues both sequentially and year-over-year, with a return to profitability," said Nachum "Homi" Shamir, President & CEO. "I am very pleased with the significant progress we are making. Looking forward, exciting new products with unique features and the effective execution we have shown with our current portfolio support a return to accelerated organic growth. We are well positioned to achieve our target of $500M of annual organic revenue, profitability, and strong positive cash flow in the next few years."
RESULTS AND REVENUE SUMMARY FOR FOURTH QUARTER AND FULL-YEAR 2019
-- Tools (Flow Cytometry + Licensed Technologies Group) revenue 5% lower in
Q4 2019, but up 2% in full-year 2019 vs. 2018.
-- Flow Cytometry revenue up 2% to $12.0M in Q4 and up 11% to $45.2M in
full-year 2019 vs. 2018, respectively.
-- Licensed Technologies Group revenue 7% lower to $38.6M in Q4 and
unchanged at $149.0M in full-year 2019 vs. 2018, respectively.
Consumable revenue was impacted by the timing of purchases. End user
sales of our technology and royalty revenue increased 12% and 8% in
full-year 2019 vs. 2018, respectively.
-- Total Molecular Diagnostic (MDx) revenue unchanged at $38.8M in Q4 2019,
and 16% lower to $136.7M in full-year 2019 vs. 2018, primarily driven by
the departure of certain sales to LabCorp, which impacted full-year 2019
by $32M.
-- MDx revenue up 1% and up 4% in Q4 and full-year 2019 vs. 2018,
respectively, without consideration of LabCorp revenue. The growth,
absent the LabCorp effect, was primarily attributable to increases
in sample to answer portfolio revenue.
-- Molecular sample-to-answer portfolio revenue up 15% to $21.0M in Q4 2019
and up 21% to $75.7M in full-year 2019 vs. 2018.
-- Consolidated gross margins of 55% in the fourth quarter and full-year
2019 were affected primarily by the departure of higher margin LabCorp
revenue, as well as growth across all of the company's lower margin
items.
REVENUE SUMMARY
(in thousands, except percentages)
Three Months Ended
December 31, Variance
---
2019 2018
($) (%)
---
(unaudited)
System
sales $20,773 $10,209 $10,564 103%
Consumable
sales 11,723 15,678 (3,955) -25%
Royalty
revenue 13,565 13,507 58 0%
Assay
revenue 36,374 36,952 (578) -2%
Service
revenue 5,651 3,225 2,426 75%
Other
revenue 2,415 1,562 853 55%
$90,501 $81,133 $9,368 12%
Twelve Months Ended
December 31, Variance
---
2019 2018
($) (%)
---
(unaudited)
System
sales $70,276 $39,986 $30,290 76%
Consumable
sales 48,542 50,144 (1,602) -3%
Royalty
revenue 53,562 49,394 4,168 8%
Assay
revenue 132,028 156,714 (24,686) -16%
Service
revenue 22,413 12,159 10,254 84%
Other
revenue 7,817 7,421 396 5%
$334,638 $315,818 $18,820 6%
===
2020 REVENUE GUIDANCE
The company anticipates its first quarter 2020 revenue to be between $82M and $84M and reaffirms its full-year 2020 revenue guidance of between $352M to $362M. The mid-point of full-year 2020 revenue guidance is 7% higher relative to the prior year; the full-year revenue guidance includes approximately 2 to 3 percent headwind attributable to the departure of certain remaining sales to LabCorp.
CONFERENCE CALL
Management will host a conference call at 4:00 p.m. Central Time / 5:00 p.m. EST, Monday, February 10, 2020 to discuss operating highlights and financial results for the fourth quarter and full-year 2019. The conference call will be webcast live and may be accessed at Luminex Corporation's website at investor.luminexcorp.com. The presentation slides will be posted to our Investor Relations website after the market close on February 10, 2020. Analysts may participate on the conference call by dialing (877) 930-7053 (U.S.) or (253) 336-7290 (outside the U.S.). The access code is 1593082. The webcast will be archived for six months on our website using the 'replay' link.
ABOUT LUMINEX CORPORATION
At Luminex, our mission is to empower labs to obtain reliable, timely, and actionable answers, ultimately advancing health. We offer a wide range of solutions applicable in diverse markets including clinical diagnostics, pharmaceutical drug discovery, biomedical research, genomic and proteomic research, biodefense research, and food safety. We accelerate reliable answers while simplifying complexity and deliver certainty with a seamless experience. To learn more about Luminex, please visit us at luminexcorp.com.
USE OF FORWARD-LOOKING STATEMENTS
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 2020 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(®), xMAP(®) INTELLIFLEX, VERIGENE(®), VERIGENE(® )II, Guava(®), Muse(®), Amnis(®) 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; 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 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 2020 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
Jeff Christensen
Harriss Currie
Senior Director, Investor Relations
Senior Vice President of Finance and jeffc@luminexcorp.com
Chief Financial Officer 512-249-3033
hcurrie@luminexcorp.com
512-219-8020
LUMINEX CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
December 31,
December 31,
2019 2018
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $59,173 $76,441
Accounts receivable, net 55,815 53,396
Inventories, net 77,084 63,250
Prepaids and other 10,398 9,657
Total current assets 202,470 202,744
Property and equipment, net 65,515 66,288
Intangible assets, net 90,336 105,148
Deferred income taxes 27,702 21,470
Goodwill 118,145 118,127
Right of use assets 20,439 -
Other 19,122 11,398
Total assets $543,729 $525,175
===
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $17,983 $14,504
Accrued liabilities 31,872 26,772
Deferred revenue -current
portion 8,214 10,099
Total current liabilities 58,069 51,375
Deferred revenue 1,633 1,079
Lease liabilities 17,182 -
Other long-term liabilities 1,985 5,065
Total liabilities 78,869 57,519
Stockholders' equity:
Common stock 44 44
Additional paid-in capital 380,304 365,349
Accumulated other
comprehensive loss (1,380) (1,127)
Retained earnings 85,892 103,390
Total stockholders' equity 464,860 467,656
Total liabilities and
stockholders' equity $543,729 $525,175
===
LUMINEX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three Months Ended Twelve Months Ended
December 31, December 31,
---
2019 2018 2019 2018
---
(unaudited) (unaudited)
Revenue $90,501 $81,133 $334,638 $315,818
Cost of revenue 40,636 32,792 151,899 120,327
Gross profit 49,865 48,341 182,739 195,491
Operating expenses:
Research and development 12,933 13,170 56,228 47,164
Selling, general and
administrative 31,098 32,036 127,183 111,816
Amortization of acquired
intangible assets 2,851 2,167 11,407 8,665
Total operating expenses 46,882 47,373 194,818 167,645
---
Income (loss) from
operations 2,983 968 (12,079) 27,846
Other income (expense),
net 3,196 3,100 465
(Loss) income from equity
method investment (523) (523) -
Income (loss) before
income taxes 5,656 968 (9,502) 28,311
Income tax benefit
(expense) (2,273) (3,263) 5,664 (9,803)
---
Net income (loss) $3,383 $(2,295) $(3,838) $18,508
Net income (loss) attributable to common
stockholders
Basic $3,322 $(2,257) $(3,773) $18,196
Diluted $3,322 $(2,258) $(3,775) $18,197
Net income (loss) per share attributable to common
stockholders
Basic $0.08 $(0.05) $(0.09) $0.42
Diluted $0.07 $(0.05) $(0.09) $0.41
Weighted-average shares used in computing net
income per share
Basic 44,263 43,867 44,148 43,727
Diluted 44,503 44,563 44,148 44,291
Dividends declared per
share $0.09 $0.06 $0.30 $0.24
LUMINEX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Three Months Ended Twelve Months Ended
December 31, December 31,
---
2019 2018 2019 2018
---
(unaudited) (unaudited)
Cash flows from operating activities:
Net income (loss) $3,383 $(2,295) $(3,838) $18,508
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 7,358 5,937 28,529 23,674
Stock-based compensation 3,554 3,766 13,198 12,226
Deferred income tax (benefit)
expense 3,526 (491) (7,444) 8,159
Loss on sale or disposal of assets 409 287 641 730
(Earnings) loss on equity method
investment (2,719) (2,719) -
Other 203 (83) (329) (1,369)
Changes in operating assets and liabilities:
Accounts receivable, net (10,004) (11,192) (2,440) (1,569)
Inventories, net (956) (1,243) (13,559) (6,827)
Other assets 819 1,424 4,789 (3,319)
Accounts payable (1,170) 1,712 3,370 4
Accrued liabilities 1,326 6,543 (5,630) 103
Deferred revenue (421) (74) (1,031) 579
---
Net cash provided by (used in)
operating activities 5,308 4,291 13,537 50,899
---
Cash flows from investing activities:
Purchase of property and equipment (3,133) (7,028) (16,249) (21,292)
Business acquisition consideration,
net of cash acquired (65,381) (65,381)
Proceeds from net working capital
adjustments related to business
acquisition 1,915 -
Issuance of note receivable (1,000)
Purchase of equity method investment (6,980) (6,980) -
Proceeds from (payments to) cost
method investment 735 735 (1,782)
Proceeds from sale of assets 2 2
Acquired technology rights (40) (40) (4,000)
Net cash used in investing
activities (9,418) (72,407) (20,619) (93,453)
---
Cash flows from financing activities:
Proceeds from issuance of common
stock 1,269 588 3,750 4,570
Shares surrendered for tax
withholding (6) (278) (2,095) (2,312)
Dividends paid (4,055) (2,676) (12,153) (10,654)
Net cash used in financing
activities (2,792) (2,366) (10,498) (8,396)
---
Effect of foreign currency exchange
rate on cash 24 29 312 279
Change in cash and cash equivalents (6,878) (70,453) (17,268) (50,671)
Cash and cash equivalents, beginning
of period 66,051 146,894 76,441 127,112
---
Cash and cash equivalents, end of
period $59,173 $76,441 $59,173 $76,441
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SOURCE Luminex Corporation
