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Luminex Corporation Reports First Quarter 2020 Results
Delivers Accelerated Organic Growth and Return to Profitability

AUSTIN, Texas, May 4, 2020 /PRNewswire/ -- Luminex Corporation (Nasdaq: LMNX) today announced results for its first quarter ended March 31, 2020.

All amounts in this release are in conformity with U.S. generally accepted accounting principles ("GAAP").

CURRENT HIGHLIGHTS

  • Total revenue for the first quarter of $90.4M, a 10% increase over Q1 2019
  • Molecular Diagnostic revenue for the quarter of $45.2M, up 28% over Q1 2019
    • Sample-to-answer MDx revenue of $26.3M, up 38% over Q1 2019
    • Non-Automated MDx revenue of $18.9M, up 17% over Q1 2019
  • Life Science and Clinical Tools revenue for the quarter of $43.3M, down 6% vs. Q1 2019
    • Licensed Technologies Group revenue of $36.8M, up 5% over Q1 2019
    • Flow Cytometry revenue of $6.5M, down 42% vs. Q1 2019, but significantly impacted by the  inability to install purchased systems and visit customers due to the COVID-19 pandemic
  • Placed a record 123 sample-to-answer systems in the quarter, dominated by ARIES® Systems
  • Returned to profitability in the quarter with 56% gross margins, 2% operating margin and 1% net income
  • Emergency Use Authorizations (EUA) obtained for NxTAG®CoV Extended Panel and ARIES® SARS-CoV-2 Assay, supported by $1.2M in BARDA funding
  • Expanded current manufacturing capacity to produce more than 500,000 tests per month, with plans to expand to more than 800,000 tests per month by the end of Q2
  • Q2 revenue forecasted to be at or above $105M, with growth in excess of 26%
  • Expect 2020 revenue to be above the top end of previously communicated guidance range of $352 - $362 million

CEO COMMENTARY

"We are proud to be able to play an important role in addressing the current global COVID-19 pandemic. Our organization has been able to respond rapidly with beneficial product offerings to assist with diagnosing and treating this dangerous virus," said Nachum "Homi" Shamir, President & CEO. "As a result of the COVID-19 pandemic, we experienced a rapid acceleration of system placements, assay sales and revenue. We delivered a very strong first quarter, returning to profitability with significant revenue growth within our molecular diagnostics franchise. With our expanded manufacturing capacity for both automated and non-automated products and a robust product pipeline, we are well equipped to meet the evolving needs of our customers. Our ability to manage multiple projects as a team while responding to this global crisis has been nothing short of exceptional. Given the increased demand we are seeing into the foreseeable future, we are confident that we will exceed the top end of our previously communicated guidance range, but are unable to be specific at this time as a result of the uncertainty associated with the end of the pandemic."


Three Months Ended






March 31,


Variance


2020


2019


($)


(%)


(unaudited)













System sales

$  12,050


$  15,671


$ (3,621)


-23%

Consumable sales

12,798


10,724


2,074


19%

Royalty revenue

13,259


14,170


(911)


-6%

Assay revenue

43,723


34,813


8,910


26%

Service revenue

5,521


5,394


127


2%

Other revenue

3,073


1,636


1,437


88%


$  90,424


$  82,408


$  8,016


10%

2020 REVENUE GUIDANCE

The Company expects revenue for the 2nd Quarter will be at or above $105M. With respect to the full year, we are confident that we will beat the top end of our current revenue guidance of $362M, but are not able to provide an updated guidance range at this time due to the uncertainties that the COVID-19 pandemic is causing throughout the global economy. We anticipate being able to provide updated full-year revenue guidance in conjunction with our second quarter earnings release.

CONFERENCE CALL

Management will host a conference call at 4:00 p.m. Central Time / 5:00 p.m. EDT, Monday, May 4, 2020 to discuss operating highlights and financial results for the first quarter 2020. The conference call will be webcast live and may be accessed at Luminex Corporation's website at investor.luminexcorp.com. 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 6418909. 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  "expect," "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, negative effects from the worldwide COVID-19 pandemic (including but not limited to the general economic downturn related to such pandemic, travel restrictions related thereto, business closures that may affect our supply chain or our ability to install instruments, and delays in FDA clearances related to adjustments in the agency's approval priorities in response to the pandemic), 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

Harriss Currie

Senior Vice President,

Chief Financial Officer

[email protected]

512-219-8020

Carla Stanaford

Investor Relations

[email protected] 

937-469-2120

Media Contact:

Michele Parisi

Bioscribe

[email protected]  

925-864-5028

 

LUMINEX CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)






March 31,


December 31,


2020


2019


(unaudited)



ASSETS




Current assets:




Cash and cash equivalents

$     43,077


$         59,173

Accounts receivable, net

63,889


55,815

Inventories, net

78,596


77,084

Prepaids and other

10,944


10,398

Total current assets

196,506


202,470

Property and equipment, net

64,407


65,515

Intangible assets, net

87,485


90,336

Deferred income taxes

26,657


27,702

Goodwill

118,145


118,145

Right of use assets

20,487


20,439

Other

18,236


19,122

Total assets

$   531,923


$       543,729





LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities:




Accounts payable

$     13,236


$         17,983

Accrued liabilities

26,751


31,872

Deferred revenue - current portion

9,084


8,214

Total current liabilities

49,071


58,069

Deferred revenue

1,606


1,633

Lease liabilities

16,748


17,182

Other long-term liabilities

1,992


1,985

Total liabilities

69,417


78,869

Stockholders' equity:




Common stock

45


44

Additional paid-in capital

381,501


380,304

Accumulated other comprehensive loss

(1,443)


(1,380)

Retained earnings

82,403


85,892

Total stockholders' equity

462,506


464,860

Total liabilities and stockholders' equity

$   531,923


$       543,729

 

LUMINEX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)






Three Months Ended


March 31,


2020


2019


(unaudited)





Revenue

$     90,424


$     82,408

Cost of revenue

40,078


36,601

Gross profit

50,346


45,807

Operating expenses:




Research and development

11,918


15,048

Selling, general and administrative

33,935


31,491

Amortization of acquired intangible assets

2,852


2,852

Total operating expenses

48,705


49,391

Income (loss) from operations

1,641


(3,584)

Other income, net

1


60

Loss from equity method investment

(614)


-

Income (loss) before income taxes

1,028


(3,524)

Income tax benefit (expense)

(374)


6,484

Net income

$          654


$       2,960





Net income attributable to common stockholders




Basic

$          634


$       2,904

Diluted

$          633


$       2,904

Net income per share attributable to common stockholders



Basic

$         0.01


$         0.07

Diluted

$         0.01


$         0.07

Weighted-average shares used in computing net income per share



Basic

44,404


43,949

Diluted

45,038


44,546





Dividends declared per share

$         0.09


$         0.06





 

LUMINEX CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)






Three Months Ended


March 31,


2020


2019


(unaudited)

Cash flows from operating activities:




Net income

$     654


$  2,960

Adjustments to reconcile net income to net cash used in operating activities:




Depreciation and amortization

7,434


6,889

Stock-based compensation

2,683


2,449

Deferred income tax (benefit) expense

1,053


(8,087)

Loss on sale or disposal of assets

47


94

Loss on equity method investment

614


-

Other

(138)


(242)

Changes in operating assets and liabilities:




Accounts receivable, net

(8,075)


(7,342)

Inventories, net

(1,510)


(486)

Other assets

(501)


2,272

Accounts payable

(4,186)


4,117

Accrued liabilities

(6,134)


(10,400)

Deferred revenue

843


680

Net cash used in operating activities

(7,216)


(7,096)

Cash flows from investing activities:




Purchase of property and equipment

(3,923)


(3,823)

Proceeds from cost method investment

22


-

Net cash used in investing activities

(3,901)


(3,823)

Cash flows from financing activities:




Proceeds from issuance of common stock

1,349


802

Shares surrendered for tax withholding

(2,310)


(2,072)

Dividends paid

(4,063)


(2,696)

Net cash used in financing activities

(5,024)


(3,966)

Effect of foreign currency exchange rate on cash

45


133

Change in cash and cash equivalents

(16,096)


(14,752)

Cash and cash equivalents, beginning of period

59,173


76,441

Cash and cash equivalents, end of period

$43,077


$61,689

 

Luminex logo. (PRNewsFoto/Luminex Corporation)

 

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SOURCE Luminex Corporation