OraSure Technologies (NASDAQ:OSUR)
Historical Stock Chart
From Jul 2019 to Jul 2024
OraSure Technologies, Inc. (NASDAQ:OSUR), a market leader in oral fluid
diagnostics, today announced revenues of $82.7 million and $19.8 million
for the year and quarter ended December 31, 2007, respectively. This
compares to revenues of $68.2 million and $17.7 million for the year and
quarter ended December 31, 2006, respectively.
The Company reported net income of $2.5 million, or $0.05 per share on a
fully-diluted basis, for the full year 2007. These results compare to
net income of $5.3 million, or $0.11 per share on a fully-diluted basis,
for the full year 2006. Net income for the full year 2007 included a
$1.4 million pre-tax gain on sale of an investment in a privately-held
nonaffiliated company.
For the quarter ended December 31, 2007, the Company reported net income
of $27,000 representing break-even earnings per share on a fully-diluted
basis. These results compare to net income of $1.0 million, or $0.02 per
share on a fully-diluted basis, for the quarter ended December 31, 2006.
For the year ended December 31, 2007, increased sales of the Company’s
OraQuick® rapid HIV-1/2 antibody tests and
over-the-counter (“OTC”)
cryosurgery products, together with an increase in funded research and
development related to the Company’s rapid
Hepatitis C (“HCV”)
test, contributed to the 21% increase in total revenue. Revenue for the
quarter ended December 31, 2007 increased 12%, also as a result of
increased sales of the Company’s OraQuick®
tests and OTC cryosurgery products, as well as increased sales in the
insurance risk assessment market. These increases for the quarter were
partially offset by a decrease in sales of the Company’s
Intercept® oral fluid drug testing product
compared to 2006.
“We are pleased with the robust revenue
increase delivered in 2007, and in particular with the continued growth
of our infectious disease business,” said
Douglas A. Michels, President and Chief Executive Officer of OraSure
Technologies. “We believe the OraQuick®
rapid HIV test will continue to drive significant growth in the future.
During 2007, we also expanded our international business and continued
to build the groundwork for our future success by making significant
progress in the clinical development of a rapid HIV test for home use
and a rapid Hepatitis C test for professional use.”
The Company’s gross margins were 61% and 58%
for the full year 2007 and quarter ended December 31, 2007,
respectively. Gross margins decreased from 64% for the full year 2006
and from 65% for the quarter ended December 31, 2006. The decrease in
gross margin for the year was largely due to an increase in inventory
scrap expenses, higher product support costs and a less favorable
product mix. The decrease for the fourth quarter was largely due to a
less favorable product mix and a higher unit cost associated with the
introduction of a new cryosurgical device in the European OTC market.
The 2006 fourth quarter and full year margins also benefited from a
favorable adjustment to royalty expense as the result of a re-negotiated
patent license.
For the full year 2007, operating expenses increased to $51.5 million
from $37.9 million in 2006. Operating expenses for the quarter ended
December 31, 2007 were $13.0 million, compared to $10.7 million for the
comparable period in 2006. These increases were primarily attributable
to higher research and development costs associated with the development
and clinical work for an OraQuick® rapid HIV
test for home use and an OraQuick® hepatitis
C test for professional use, higher staffing related costs and increased
advertising reimbursement expense related to the Company’s
international OTC cryosurgical product. Operating expenses for the full
year 2007 were also higher due to increased legal expenses related to
the dispute with Prestige Brands, which was resolved in the fourth
quarter of 2007.
Cash flow from operating activities was $11.5 million in 2007, compared
to $16.9 million reported in 2006. The decrease was primarily the result
of lower net income and increases in inventories and accounts
receivable, partially offset by an increase in accounts payable and
accrued expenses.
Cash, cash equivalents and short-term investments totaled $95.6 million
and working capital was $105.6 million at December 31, 2007, compared to
$91.0 million and $96.0 million, respectively, at December 31, 2006.
Full Year and First Quarter 2008 Outlook
The Company expects total revenues for 2008 to range from approximately
$90.0 to $92.0 million. This projection does not include the amount
payable under the Schering-Plough settlement for past sales which will
be recorded as other income, nor does it include any contribution in
2008 from the reintroduction of a cryosurgical wart treatment product in
the U.S. OTC market or launch of an OTC cryosurgical product line
extension for which the Company is seeking FDA 510(k) clearance. The
timing and potential magnitude of any revenues from these cryosurgical
products are not predictable at this time. The Company does not include
items in its guidance unless it believes the related revenues are likely
to be achieved.
The Company expects to increase its Research and Development
expenditures for 2008 to approximately $21.0 million, representing an
increase of $7.0 million or approximately $0.08 per share over 2007. As
a result, the Company expects to achieve fully diluted earnings per
share for 2008 of approximately $0.05 to $0.07.
For the first quarter of 2008, revenues are expected to range from
approximately $18.0 to $18.5 million with sequential growth in
infectious disease and substance abuse testing revenues compared to the
fourth quarter of 2007, offset by lower cryosurgical revenues as a
result of seasonality and the absence of U.S. OTC cryosurgical sales.
The Company is currently projecting fully-diluted earnings per share for
the first quarter of 2008 of approximately $0.03 to $0.04.
Condensed Financial Data
(In thousands, except per-share
data and percentages)
Unaudited
Three months ended
Year ended
December 31,
December 31,
2007
2006
2007
2006
Results of Operations
Revenues
$
19,809
$
17,734
$
82,686
$
68,155
Cost of products sold
8,281
6,240
32,403
24,756
Gross profit
11,528
11,494
50,283
43,399
Operating expenses:
Research and development
4,240
2,898
14,136
8,648
Sales and marketing
5,063
3,945
20,062
15,921
General and administrative
3,668
3,885
17,304
13,367
Total operating expenses
12,971
10,728
51,502
37,936
Operating income (loss)
(1,443
)
766
(1,219
)
5,463
Other income, net
1,070
1,020
5,513
3,599
Pre-tax income (loss)
(373
)
1,786
4,294
9,062
Income tax provision (benefit)
(400
)
761
1,821
3,794
Net income
$
27
$
1,025
$
2,473
$
5,268
Earnings per share:
Basic
$
--
$
0.02
$
0.05
$
0.11
Diluted
$
--
$
0.02
$
0.05
$
0.11
Weighted average shares:
Basic
46,625
45,974
46,325
45,910
Diluted
47,336
46,440
46,878
46,580
Three months ended December 31,
Percentage of
Dollars
%
Total Revenues
Market Revenues
2007
2006
Change
2007
2006
Infectious disease testing
$
9,444
$
7,943
19
%
48
%
45
%
Substance abuse testing
3,390
4,058
(16
)
17
23
Cryosurgical systems
5,343
4,269
25
27
24
Insurance risk assessment
1,605
1,437
12
8
8
Product revenues
19,782
17,707
12
100
100
Licensing and product development
27
27
—
—
—
Total revenues
$
19,809
$
17,734
12
%
100
%
100
%
Year ended December 31,
Percentage of
Dollars
%
Total Revenues
Market Revenues
2007
2006
Change
2007
2006
Infectious disease testing
$
35,791
$
29,180
23
%
43
%
43
%
Substance abuse testing
15,789
15,752
—
19
23
Cryosurgical systems
23,533
17,333
36
28
25
Insurance risk assessment
5,464
5,565
(2
)
7
8
Product revenues
80,577
67,830
19
97
99
Licensing and product development
2,109
325
549
%
3
1
Total revenues
$
82,686
$
68,155
21
%
100
%
100
%
Three months ended
Year ended
December 31,
%
December 31,
%
OraQuick®
Revenues
2007
2006
Change
2007
2006
Change
Direct to U.S. Public Health
$
5,460
$
4,475
22
%
$
19,799
$
15,268
30
%
Abbott
2,018
1,674
21
8,103
6,897
17
SAMHSA
—
150
N/A
339
406
(17
)
CDC
—
282
N/A
1,125
1,291
(13
)
International
1,181
509
132
%
3,291
1,694
94
Total OraQuick®
revenues
$
8,659
$
7,090
22
%
$
32,657
$
25,556
28
%
Three months ended
Year ended
December 31,
%
December 31,
%
Intercept®
Revenues
2007
2006
Change
2007
2006
Change
Workplace testing
$
1,282
$
1,871
(31
)%
$
6,650
$
6,616
1
%
Criminal Justice
622
600
4
2,570
2,398
7
International
431
636
(32
)
2,188
2,314
(5
)
Direct
264
200
32
1,003
728
38
Total Intercept®
revenues
$
2,599
$
3,307
(21
)%
$
12,411
$
12,056
3
%
Three months ended
Year ended
December 31,
%
December 31,
%
Cryosurgery Revenues
2007
2006
Change
2007
2006
Change
Professional domestic
$
1,806
$
1,203
50
%
$
5,247
$
5,360
(2
)%
Professional international
798
788
1
2,349
2,284
3
OTC domestic
650
1,216
(47
)
6,237
5,174
21
OTC international
2,089
1,062
97
9,700
4,515
115
%
Total cryosurgery revenues
$
5,343
$
4,269
25
%
$
23,533
$
17,333
36
%
Balance Sheets
December 31, 2007
December 31, 2006
Assets
Cash, cash equivalents and short-term investments
$
95,566
$
91,001
Accounts receivable, net
11,296
10,357
Inventories
9,410
5,534
Current deferred income taxes
5,061
3,676
Other current assets
2,744
1,990
Property and equipment, net
20,911
17,375
Deferred income taxes
17,266
19,846
Other non-current assets
5,387
6,786
Total assets
$
167,641
$
156,565
Liabilities and Stockholders’
Equity
Current portion of long-term debt
$
557
$
609
Accounts payable
5,905
3,312
Accrued expenses
11,996
12,658
Long-term debt
8,818
10,031
Other liabilities
311
451
Stockholders’ equity
140,054
129,504
Total liabilities and stockholders’
equity
$
167,641
$
156,565
Year ended December 31,
Additional Financial Data
2007
2006
Capital expenditures
$
5,372
$
12,643
Depreciation and amortization
$
2,736
$
1,923
Accounts receivable – days sales
outstanding
50 days
55 days
Conference Call
The Company will host a conference call and audio webcast to discuss the
Company’s 2007 fourth quarter and full year
financial results, business developments and 2008 financial guidance,
beginning today at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time). On
the call will be Douglas A. Michels, President and Chief Executive
Officer, and Ronald H. Spair, Chief Financial Officer and Chief
Operating Officer. The call will include prepared remarks by management
and a question and answer session.
In order to listen to the conference call, please either dial
888-742-2024 (Domestic) or 706-643-0033 (International) and reference
Conference ID #32848688, or go to OraSure Technologies' web site, www.orasure.com,
and click on the Investor Info link. A replay of the call will be
archived on OraSure Technologies' web site shortly after the call has
ended and will be available for seven days. A replay of the call can
also be accessed until February 19, 2008, by dialing 800-642-1687
(Domestic) or 706-645-9291 (International) and entering the Conference
ID #32848688.
About OraSure Technologies
OraSure Technologies develops, manufactures and markets oral fluid
specimen collection devices and tests and other diagnostic products
using proprietary technologies, including immunoassays and other in
vitro diagnostic tests and other medical devices. These products are
sold in the United States and certain foreign countries to clinical
laboratories, hospitals, clinics, community-based organizations and
other public health organizations, distributors, government agencies,
physicians' offices, and commercial and industrial entities. For more
information on the Company, please visit www.orasure.com.
Important Information
This press release contains certain forward-looking statements,
including with respect to revenues, net income and products. Actual
results could be significantly different. Factors that could affect
results include the ability to market and sell products; changes in
relationships, including disputes or disagreements, with strategic
partners and reliance on strategic partners for the performance of
critical activities under collaborative arrangements; failure of
distributors or other customers to meet purchase forecasts or minimum
purchase requirements for the Company’s
products; impact of competitors, competing products and technology
changes; ability to develop, commercialize and market new products;
market acceptance of oral fluid testing, rapid point-of-care testing or
other products; changes in market acceptance of products based on
product performance; continued bulk purchases by customers, including
governmental agencies, and the ability to fully deploy those purchases
in a timely manner; ability to fund research and development and other
products and operations; ability to obtain and maintain new or existing
product distribution channels; reliance on sole supply sources for
critical product components; availability of related products produced
by third parties or products required for use of our products; ability
to obtain, and timing and cost of obtaining, necessary regulatory
approvals for new products or new indications or applications for
existing products; ability to comply with applicable regulatory and
legal requirements; history of losses and ability to achieve sustained
profitability; volatility of our stock price; uncertainty relating to
patent protection; uncertainty and costs of litigation relating to
patents and other intellectual property; availability of licenses to
patents or other technology; ability to enter into international
manufacturing agreements; obstacles to international marketing and
manufacturing of products; ability to sell products internationally;
loss or impairment of sources of capital or investments; ability to meet
financial covenants in agreements with financial institutions; ability
to retain qualified personnel; exposure to patent infringement, product
liability and other types of litigation; changes in international,
federal or state laws and regulations; customer consolidations and
inventory practices; equipment failures and ability to obtain needed raw
materials and components; the impact of terrorist attacks and civil
unrest; ability to complete consolidation or restructuring activities;
ability to identify, complete and realize the full benefits of potential
acquisitions; and general political, business and economic conditions.
These and other factors are discussed more fully in the Securities and
Exchange Commission (“SEC”)
filings of OraSure Technologies, including its registration statements,
its Annual Report on Form 10-K for the year ended December 31, 2006, its
Quarterly Reports on Form 10-Q, and its other filings with the SEC.
Although forward-looking statements help to provide complete information
about future prospects, readers should keep in mind that forward-looking
statements may not be reliable. The forward-looking statements are made
as of the date of this press release and OraSure Technologies undertakes
no duty to update these statements.