Luminex Beats on Assay Boost - Analyst Blog
07 February 2012 - 7:00PM
Zacks
Luminex
Corporation (LMNX), a developer of biological testing
technologies, reported fourth-quarter fiscal 2011 adjusted earnings
of 11 cents a share, outpacing both the Zacks Consensus Estimate
and the year-ago earnings of 7 cents a share. The adjusted earnings
exclude costs associated with the company’s acquisition of EraGen
Biosciences.
Profit rose 7.6% year over year to
$3.4 million (or 8 cents a share) as the Texas-based company saw
double-digit growth in its top line, backed by a lower tax.
For the full year, adjusted
earnings of 45 cents a share topped the Zacks Consensus Estimate of
34 cents and exceeded the year-ago earnings of 12 cents per share.
Profit (as reported) skyrocketed nearly three-fold year over year
to $14.5 million (or 34 cents a share).
Revenue and
Margins
Revenues for the quarter soared 16%
year over year to $47.9 million, just beating the Zacks Consensus
Estimate of $47 million. Sales were boosted by robust growth in
assay revenues. For the fiscal, sales surged 30% year over year to
$184.3 million, also beating the Zacks Consensus Estimate of $183
million.
Assay sales ballooned 77% to $16.4
million, powered by the cystic fibrosis and respiratory viral panel
businesses. The growth was also fueled by the contributions of
EraGen Biosciences which Luminex bought in June 2011.
System sales nudged up 1% year over
year to $10.4 million. Luminex shipped 307 multiplexing analyzers
(including 114 MAGPIX systems) in the fourth quarter, resulting in
total life-to-date shipments of 8,678 analyzers, up nearly 13% year
over year.
The company’s Consumable business
was the weak spot in the quarter with sales dipping 16% to roughly
$10.1 million. Royalty revenues jumped 17% to roughly $7.1
million.
Gross margin, as reported, fell to
67.9% from 69.4% a year ago, impacted by charges associated with
the EraGen acquisition. Operating expenses climbed roughly 22% year
over year to $28.6 million with operating margin dropping to 8.2%
from 12.3% a year ago.
Balance Sheet
Luminex exited the fiscal with cash
and cash equivalents of $58.3 million, down roughly 35% year over
year, with total long-term debt of $3.6 million (down 15% year over
year).
Guidance
Moving ahead, Luminex expects
revenues for fiscal 2012 in a range of $205 million to $215
million, an 11%-17% year-over-year growth. The current Zacks
Consensus Estimate is $209 million.
Luminex possesses an extensive
product portfolio and a healthy pipeline of novel assays, which are
expected to support growth going ahead. The company launched its
xTAG Gastrointestinal Pathogen Panel (“GPP”) molecular test in
Europe following the CE mark approval in May 2011. Moreover,
Luminex, in July 2011, received the U.S. approval for its xTAG
Respiratory Viral Panel (“RVP”) Fast assay.
However, Luminex operates in a
highly competitive life sciences industry. The company competes
with Affymetrix (AFFX) and
Sequenom (SQNM), among others. Moreover, sluggish
growth in its core markets is a challenge faced by Luminex. We are
currently Neutral on the stock, which is backed by a short-term
Zacks #3 Rank (Hold).
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