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Hologic Q2 Revenues Grow 5 Percent

NEW YORK (GenomeWeb) – Hologic reported after the close of the market on Wednesday that its fiscal second quarter revenues grew 5 percent year over year as its molecular diagnostic revenues grew more than 6 percent. 

For the three months ended March 28 the Bedford, Mass.-based firm said that it recorded total revenues of $655.5, up from $625 million in the year-ago quarter. It beat the average analysts' estimate of $645.6 million. 

On a constant currency basis, revenues were up 7 percent, Hologic said. 

The firm posted product revenues of $546.4 million, a 5 percent improvement from $521.1 million in Q2 2014, while service and other revenues increased 5 percent to $109.1 million from $103.9 million. 

The company's Diagnostics segment revenues grew 2 percent to $296.7 million from $290.8 million a year ago, as its molecular diagnostics revenues improved to $119.7 million in Q2 2015 on the strength of its human papillomavirus business, Hologic CFO Robert McMahon said on a conference call after the release of the company's financial results. 

Hologic President and CEO Steve MacMillan added that the company believes that it is now the leader in the US HPV market. "Our leadership is based mainly on the strong combination and differentiated benefits of the Aptima HPV assay and automated instruments like Panther and Tigris," he said. 

MacMahon said that Hologic is now "easily within reach" of the company's year-end goal of 1,000 aggregate placements for the Panther platform.  

Staying within Diagnostics, Hologic said that blood screening revenues were up about 8 percent year over year on new business with the Japanese Red Cross. Meanwhile, cytology and perinatal sales were down 5 percent year over year as the ThinPrep business continued to decline although the downtick had moderated. 

Last week, the company provided an early look at its Fusion instrument at a conference in Europe. The system combines PCR with real-time transcription-mediated amplification technology, and while Hologic is "very excited" about the instrument, MacMillan said that assay work for the system remains in the early stages, particularly in terms of efforts around the PCR technology. 

Hologic does not expect to have a "legitimate assay menu" for Fusion until possibly 2017 and maybe even later, he added. "The instrumentation work was well done, and we just haven't followed through on the assay work as much," MacMillan said. 

Among its other segments, Breast Health grew 7 percent to $255.5 million, Gynecology Surgical was up 10 percent to $79.1 million, and Skeletal Health improved 3 percent to $24.2 million. 

Hologic posted a profit of $47.8 million, or $.17 per share, for the second quarter, compared to a net loss of $16.8 million, or $.06 per share, a year ago. On a non-GAAP basis, Hologic had EPS of $.41 and beat the consensus Wall Street estimate of $.39. 

Its R&D spending increased 7 percent year over year to $53.3 million from $49.9 million, while its SG&A costs were up 2 percent to $143.3 from $140.8. Hologic also had $2 million in restructuring and divestiture charges in the recently completed quarter, compared to $11.6 million in Q2 2014. 

Hologic finished the second quarter with $670.5 million in cash and cash equivalents and $4.6 million in restricted cash. 

The company initiated guidance for its fiscal third quarter with estimated revenues in the range of $645 million to $655 million, and non-GAAP EPS of between $.38 and $.39. 

Hologic also updated its guidance for full-year fiscal 2015. Revenues are now estimated to be in the range of $2.60 billion to $2.62 billion, compared to an earlier range of $2.57 billion to $2.60 billion. 

Non-GAAP EPS guidance for the year was changed to a new range of $1.57 to $1.59 from a previous range of $1.54 to $1.57. McMahon said on the call that the guidance takes into account an estimated headwind of $9 million in revenues and $.01 in EPS from currency exchange effects.