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Fulgent Q3 Total Revenues Fall 54 Percent, Non-COVID Revenues Double

NEW YORK – Fulgent Genetics reported after the close of market on Monday that its third quarter revenues declined 54 percent driven by decreasing COVID-related testing.

For the three-month period ended Sept. 30, the Temple City, California-based company posted revenues of $105.7 million compared to $227.9 million a year ago.

Separately, Fulgent Genetics announced it will acquire Fulgent Pharma for $100 million, reuniting two firms originally established in Temple City, California, in 2016 by the division of Fulgent Therapeutics. According to a statement, the combined company plans to offer a vertically integrated solution to combat cancer with the potential to unlock long-term upside for both the therapeutic and diagnostic businesses.

Fulgent said that the number of billable tests delivered in the quarter declined to approximately 952,000 million from 2.2 million in Q3 2021. Excluding COVID-related testing, the firm's core revenues more than doubled, to $56.0 million.

Ming Hsieh, chairman and CEO, said in a statement that the firm is focusing on its long-term strategy and beginning to expand its footprint across the genomic testing and therapeutics landscape. "With our diversification into oncology and pathology added to our robust test menus for pediatric genetics, reproductive health, hereditary cancer, neurological conditions and more, we have created one of the largest test menus in our industry," he added.

Paul Kim, the firm's CFO, added that the firm sees momentum building in its core business with the integration of Inform Diagnostics as COVID-19 testing winds down. "While we are experiencing some pressure on results in the fourth quarter, we view it as transitory and believe our foundational technology platform supports a strong revenue and margin profile in the years ahead," Kim also said.

Fulgent posted a net income of $1.7 million, or $.06 per share, compared to $122.5 million, or $3.93 per share, in Q3 2021. On an adjusted basis, the company reported EPS of $.32.

Its research and development spending in the quarter increased 25 percent to $7.5 million from $6.0 million a year ago. The firm's SG&A costs nearly doubled to $36.1 million from $18.3 million, due primarily to general and administrative spending more than doubling.

Fulgent finished the third quarter with $168.8 million in cash and cash equivalents and $749.2 million in investments in marketable securities.

For the fourth quarter of 2022, the company expects to generate revenues of approximately $60 million, with core revenues of approximately $52 million, which would represent 86 percent growth year-over-year. For full-year 2022, it expects revenue of $611 million, core revenue of $178 million, and non-GAAP income of approximately $5.60 per share.