Luminex (NASDAQ:LMNX)
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AUSTIN, Texas, July 25 /PRNewswire-FirstCall/ -- Luminex Corporation (NASDAQ:LMNX) today announced financial results for the second quarter and six months ended June 30, 2007. Financial and operating highlights include the following:
- Consolidated total revenue of $17.5 million, a 32 percent increase
year-over-year
- System shipments surpass 4,500, up 20 percent from a year ago
- Consolidated gross margin of 59 percent
- Announced a distribution agreement with Exiqon for the FlexmiR(TM) line
of products co-developed by the companies in 2006
- Unveiled FlexMAP 3D(TM), a next generation bead-based multiplexing
system
- Completion of manufacturing space update/expansion in response to
expanded product offerings
- Partner successes, including Bio-Rad BioPlex 2200 Quest deal
- Named Doug Bryant as Executive Vice President and Chief Operating
Officer
Consolidated revenue for the second quarter of 2007 was $17.5 million compared with $13.3 million in the second quarter of 2006. Consolidated net loss for the second quarter of 2007 was $3.2 million, or $0.09 per share, as compared with net income of $271,000, or $0.01 per share, for the comparable period of 2006.
On March 1, 2007, Luminex completed the acquisition of Tm Bioscience Corporation, a leader in the commercial genetic testing market. Beginning with the first quarter of 2007, Luminex reported the following segments: Technology Group and Assay Group. The Technology Group consists of system sales to partners, raw bead sales, royalties, service and support of the core technology and other miscellaneous items. The Assay Group consists of the Luminex Bioscience Group, or LBG, and the acquired Tm Bioscience operations, now known as Luminex Molecular Diagnostics, or LMD. This segment is primarily involved in the development and sale of assays on xMAP(R) technology for use on the Company's installed base of systems.
The Assay Group results for the second quarter of 2007 include three months of revenue from LBG and from LMD. Assay Group results for 2006 consist of LBG only. LBG introduced its first two products in the fourth quarter of 2006.
LUMINEX CORPORATION
REPORTABLE SEGMENT HIGHLIGHTS
(unaudited)
(in thousands)
Three Months Ended Six Months Ended
June 30, June 30,
2007 2006 2007 2006
-------- -------- -------- --------
Revenue
Technology group $14,822 $13,254 $30,560 $26,251
Assay group 4,000 14 5,200 14
Eliminations of intersegment revenue (1,274) - (1,605) -
-------- -------- -------- --------
Total revenue 17,548 13,268 34,155 26,265
Operating income (loss)
Technology group (408) 231 740 786
Assay group (2,623) (498) (4,078) (940)
Eliminations of intersegment
operating income (354) - (419) -
-------- -------- -------- --------
Operating income (loss) (3,385) (267) (3,757) (154)
"The results for the second quarter of 2007 reflect continued quarterly revenue growth and a solid performance for Luminex," said Patrick J. Balthrop, president and chief executive officer of Luminex. "Our xMAP platform continues to build critical mass across many segments of the life sciences marketplace. We surpassed another milestone with over 4,500 Luminex systems placed in research laboratories, clinical laboratories, bio-defense facilities and academic institutions around the world at the end of the second quarter. With our proprietary technologies, growing installed base of instruments and expanding distribution channels through our strategic partnerships, we have the opportunity to leverage these assets and achieve further market penetration in 2007.
"We are pleased with our continued progress in the integration of LMD into our operations," added Balthrop. "Our integration process is on track and we expect to deliver over $5 million in annual synergies from the combined companies. With our additional internal assay capabilities, we have several exciting opportunities to further capitalize on the growing molecular diagnostics market. We also continued to make strategic investments in our research efforts and, as a result, made significant progress in assay product development through LBG. With the addition of Doug Bryant to our management team as chief operating officer, we have further enhanced our leadership team to execute our strategy in these key areas and expand our market reach."
CONFERENCE CALL
Management will host a conference call to discuss the operating highlights and financial results for the second quarter ended June 30, 2007, on Thursday, July 26, 2007, at 8:00 a.m. Eastern time. The conference call will be webcast live and will be accompanied by a slide presentation, both of which may be accessed at our 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 and slides will be archived for one year on the website using the 'replay' link.
ABOUT LUMINEX CORPORATION
Luminex develops, manufactures and markets proprietary biological testing technologies with applications throughout the life sciences industry. The Company's xMAP(R) 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(R) technology is sold worldwide and is in use in leading research laboratories as well as major pharmaceutical, diagnostic and biotechnology companies. Further information on Luminex or xMAP(R) can be obtained on the Internet at http://www.luminexcorp.com/.
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. 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, market demand and acceptance of Luminex's products, the Company's dependence on strategic partners for development, commercialization and distribution of products, concentration of the Company's revenue in a limited number of strategic partners, fluctuations in quarterly results due to a lengthy and unpredictable sales cycle and bulk purchases of consumables, Luminex's ability to scale manufacturing operations and manage operating expenses, gross margins and inventory levels, potential shortages of components, competition, the timing of regulatory approvals, the implementation, including any modification, of the Company's strategic operating plans, risks and uncertainties associated with implementing our acquisition strategy and the ability to integrate acquired companies, including Tm Bioscience Corporation, or selected assets into our consolidated business operations, including the ability to recognize the benefits of our acquisitions, 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 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.
Contact: Harriss T. Currie
Vice President, Finance and Chief Financial Officer
512-219-8020
LUMINEX CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
June 30, December 31,
2007 2006
----------- -----------
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $11,836 $27,414
Short-term investments 3,314 10,956
Accounts receivable, net 11,614 8,237
Inventory, net 7,100 4,571
Other 1,874 1,917
----------- -----------
Total current assets 35,738 53,095
Property and equipment, net 10,189 4,985
Intangible assets, net 2,142 -
Long-term investments 5,311 7,346
Goodwill 65,432 (1) -
Other 1,705 1,270
----------- -----------
Total assets $120,517 $66,696
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $3,687 $3,255
Accrued liabilities 8,219 2,905
Deferred revenue and other 3,073 2,756
----------- -----------
Total current liabilities 14,979 8,916
Long-term debt 3,825 -
Deferred revenue and other 3,814 3,621
----------- -----------
Total liabilities 22,618 12,537
----------- -----------
Stockholders' equity:
Common stock 35 32
Additional paid-in capital 186,059 139,116
Accumulated other comprehensive
gain (80) 65
Accumulated deficit (88,115) (85,054)
----------- -----------
Total stockholders' equity 97,899 54,159
----------- -----------
Total liabilities and stockholders'
equity $120,517 $66,696
=========== ===========
(1) Luminex has recorded $65.4 million of goodwill related to the Tm
Bioscience acquisition. This goodwill asset is subject to adjustment
as Luminex completes certain standard activities around the
transaction such as: recording of final transaction related costs and
allocation of the purchase price based on our final determination of
the fair market value of the acquired operation's assets and
liabilities. No assurances can be given as to the size of any
subsequent goodwill adjustment, if any, at this time. Luminex
anticipates it will complete the purchase price allocations during the
third quarter of 2007 and a portion of the goodwill balance will be
allocated to the identified intangible assets at that time.
LUMINEX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
----------------- -----------------
2007 2006 2007 2006
-------- -------- -------- --------
(unaudited) (unaudited)
Revenue $17,548 $13,268 $34,155 $26,265
Cost of revenue 7,211 5,608 13,388 10,346
-------- -------- -------- --------
Gross profit 10,337 7,660 20,767 15,919
Operating expenses:
Research and development 3,865 1,790 6,571 3,987
Selling, general and administrative 9,857 6,137 17,953 12,086
-------- -------- -------- --------
Total operating expenses 13,722 7,927 24,524 16,073
-------- -------- -------- --------
Loss from operations (3,385) (267) (3,757) (154)
Interest expense from long-term
debt (334) - (419) -
Other income, net 421 551 1,028 967
Income taxes 101 (13) 87 (16)
-------- -------- -------- --------
Net income (loss) $(3,197) $271 $(3,061) $797
======== ======== ======== ========
Net income (loss) per share, basic $(0.09) $0.01 $(0.09) $0.03
======== ======== ======== ========
Shares used in computing net income
(loss) per share, basic 35,006 31,386 33,504 31,288
Net income (loss) per share, diluted $(0.09) $0.01 $(0.09) $0.02
======== ======== ======== ========
Shares used in computing net income
(loss) per share, diluted 35,006 32,876 33,504 32,606
LUMINEX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ -----------------
2007 2006 2007 2006
--------- ------- --------- --------
(unaudited) (unaudited)
Operating activities:
Net income (loss) $(3,197) $271 $(3,061) $797
Adjustments to reconcile net
income (loss) to net cash
provided by operating activities:
Depreciation and amortization 978 384 1,518 748
Stock-based compensation and
other 1,593 1,259 3,100 2,424
(Gain) loss on disposal of
assets 34 (2) 88 25
Other 4 (7) 4 (9)
Changes in operating assets and
liabilities:
Accounts receivable,
net (580) (3,136) (1,657) (1,476)
Inventory, net (689) 460 (721) 138
Prepaids and other (460) (399) (120) 29
Accounts payable (2,263) (254) (3,817) (1,506)
Accrued liabilities 772 335 (2,353) (835)
Deferred revenue (217) 5 143 (225)
--------- ------- --------- --------
Net cash provided by (used in)
operating activities (4,025) (1,084) (6,876) 110
--------- ------- --------- --------
Investing activities:
Net purchases of held-to-maturity
investments 2,185 955 9,710 (1,045)
Purchase of property and equipment (1,724) (643) (3,329) (1,528)
Acquisition of business, net of
cash acquired (744) - (2,735) -
Acquired technology rights (265) - (265) -
Proceeds from sale of assets 30 2 30 7
--------- ------- --------- --------
Net cash provided by (used in)
investing activities (518) 314 3,411 (2,566)
--------- ------- --------- --------
Financing activities:
Payments on debt (117) - (12,345) -
Proceeds from issuance of common
stock 159 358 174 1,434
Other 7 - 7 -
--------- ------- --------- --------
Net cash provided by (used in)
financing activities 49 358 (12,164) 1,434
Effect of foreign currency exchange
rate on cash 135 16 51 22
Change in cash and cash equivalents (4,359) (396) (15,578) (1,000)
Cash and cash equivalents, beginning
of period 16,195 24,602 27,414 25,206
--------- ------- --------- --------
Cash and cash equivalents, end of
period $11,836 $24,206 $11,836 $24,206
========= ======= ========= ========
Supplemental disclosure of cashflow
information:
Interest and penalties paid $254 $- $1,335 $-
Supplemental disclosure of non-cash
effect of acquisitions:
Purchase price $(744) $- $(47,745) $-
Common stock issued - - 41,755 -
Conversion of Tm options and
warrants - - 2,315 -
Cash acquired - - 940 -
--------- ------- --------- --------
Acquisition, net of cash acquired $(744) $- $(2,735) $-
========= ======= ========= ========
SUPPLEMENTAL SCHEDULES (unaudited)
The following table provides a detail of revenue by type for the
consolidated Company for the three and six months ended June 30, 2007 and
2006 (in thousands).
Three Months Ended Six Months Ended
June 30, June 30,
(in thousands) (in thousands)
2007 2006 2007 2006
---------- ---------- --------- --------
System Revenue $5,583 $5,811 $11,314 $9,803
Consumable Revenue 3,305 3,053 8,116 8,555
Royalty Revenue 2,241 2,001 4,773 3,791
Reagent Revenue 3,737 14 4,881 14
Service Revenue 1,087 811 2,090 1,618
Other Miscellaneous Revenue 1,595 1,578 2,981 2,484
---------- ---------- --------- --------
Total Revenue $17,548 $13,268 $34,155 $26,265
========== ========== ========= ========
DATASOURCE: Luminex Corporation
CONTACT: Harriss T. Currie, Vice President, Finance and Chief Financial
Officer of Luminex Corporation, +1-512-219-8020,
Web site: http://www.luminexcorp.com/