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2014 Revenues Grow by 15%
Trinity Biotech (Nasdaq:TRIB), a developer and manufacturer of diagnostic products for the point-of-care and clinical laboratory markets, today announced results for fiscal year 2014 and the quarter ended December 31, 2014.
Fiscal year 2014 Results:
Total revenues for fiscal year 2014 were $104.9m versus $91.2m in 2013, an increase of 15.0% year on year.
Point-of-care revenues increased from $19.8m in 2013 to $20.0m in 2014, which represents an increase of 1.4%.
Meanwhile, Clinical Laboratory revenues grew by almost 19%, mainly due to:
– higher diabetes revenues achieved through a combination of higher placements of Premier instruments and the increased pull through of related consumables for the larger installed base; and
– the underlying growth and full year impact of the Immco and blood bank screening acquisitions which were made during 2013.
Growth in these areas was partly offset by lower Lyme revenues. This decrease was attributable to the impact of adverse weather conditions in Q1, 2014 which impacted the prevalence of Lyme disease in subsequent months.
– Operating profit for the year grew by 5.0% from $17.2m to $18.0m. This represents an operating margin of 17.2%.
– Profit after tax increased from $17.1m to $17.2m.
– EBITDA before share option expense for the year increased from $22.8m to $23.8m
– EPS for the year was 76 cents versus 78 cents in 2013 whilst diluted EPS was 73 cents (2013: 73 cents).
The tax charge for the year was 4.7% which compares favourably to the 7.0% reported in 2013. This low effective rate of tax is due to the competitive corporation tax rate in Ireland and the availability of R&D tax credits in a number of jurisdictions.
The growth in profits was achieved despite the impact of a number of factors which had an adverse impact on profitability during the year, including:
– the impact of the operational costs and closure costs associated with two facilities which were undertaken as part of the blood banking acquisition. The closure of these facilities and associated costs occurred in Q3, 2014;
– sales and marketing costs incurred in relation to the company’s new Meritas range for which there were no matching revenues during the year;
– increased sales of Premier instruments – instrument sales by their nature have lower margins
– lower sales of Lyme products which typically attract stronger gross margins.
Quarter 4 Results:
Total revenues for Q4, 2014 were $26.7m which compares to $25.5m in Q4, 2013, an increase of 5%. Excluding the impact of exchange rate movements due to the strengthening dollar, the increase would have been 6.4%.
Point-of-Care revenues for Q4, 2014 increased by over 7% versus Q4, 2013. This increase reflects stronger sales of HIV products in Africa in the quarter.
Clinical Laboratory revenues increased from $20.4m to $21.2m, an increase of over 4% compared to Q4, 2013, or 6.2% after the exclusion of exchange rate movements. The main drivers of this growth were the continued strong performance of Premier and increased autoimmune sales (Immco) particularly with respect to Sjögren’s disease testing.
Consistent with the previous quarters in 2014, the gross margin of 47.5% for the quarter was lower than the equivalent quarter in 2013 due to the impact of increased Premier instrument sales and lower Lyme sales.
Research and Development expenses were just under $1m, which was broadly consistent with the corresponding period last year. Selling, General and Administrative (SG&A) expenses increased, from $6.5m to $7.2m which includes increased Meritas related expenditure, reflecting the addition of a new dedicated sales and marketing team.
The impact of the lower gross margin and increased SG&A expenditure has resulted in a reduction in operating profit from $4.8m to $4.3m. Meanwhile, profit after tax for the quarter was $4.1m, which represents an EPS for the quarter of 18 cents. EBITDA before share option expense for the quarter was $5.8m.
