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PerkinElmer Q2 Revenues Up 12 Percent

NEW YORK – PerkinElmer said after the close of the market on Tuesday that its second quarter revenues grew 12 percent year over year as Diagnostics segment revenues were up 46 percent.

For the three months ended July 5, the company reported total revenues of $811.7 million compared to $722.5 million a year ago. It beat the consensus Wall Street estimate of $726.4 million.

Organically, revenues rose 13 percent year over year, PerkinElmer CFO Jamey Mock said on a conference call following the release of the financial results.

Like almost all companies in the diagnostics space, PerkinElmer was impacted by COVID-19 during the quarter and revenues related to the coronavirus contributed $196 million to the firm's top line during Q2, PerkinElmer President and CEO Prahlad Singh said on the call. Non-COVID-19 sales were down 14 percent organically year over year, and non-COVID-19 diagnostics revenues were down 20 percent, he added.

The Diagnostics segment drove overall revenue growth as it posted $420.7 million in revenues, up from $288.6 million in Q2 2019. Organically, revenues grew 48 percent in the segment year over year.

COVID-19 related diagnostic sales were driven by the company's PCR-based tests, RNA extraction solutions, and serology kits. Each of the three products contributed in excess of $50 million in revenues during Q2 2020, Mock said.

PerkinElmer is also "actively investigating" other technologies for the direct detection of SARS-CoV-2, including point-of-care and ELISA-based antigen tests, Singh said. Additionally, the company is eyeing a respiratory panel for the simultaneous detection of SARS-CoV-2 and flu and it hopes to commercialize the test before the start of the flu season in the fall.

Singh also said that the company is exploring technologies aimed at "immune insights." Specifically, the company is exploring tests that may be able to provide information into cell-mediated immunity, as opposed to antibody-based immunity, among some patients who have become infected with the coronavirus.

PerkinElmer has "several assays in development that we hope will aid researchers and clinicians in understanding how the broader immune system may help" confer protection to patients, "including a patient's T-cell response, cytokine levels, or cellular damage," Singh said.

In other parts of the Diagnostics segment, applied genomics was up 150 percent organic growth year over year, Mock said, on broad-based momentum, driven by PerkinElmer's nucleic acid extraction and liquid handling product lines.

Immunodiagnostics increased 60 percent organically with the Euroimmun business up 30 percent.

Reproductive health declined mid-single digits organically. Prior to the COVID-19 pandemic, the company had predicted that by the end of 2020 it would have between 50 and 55 of its Vanadis NIPT system placed globally, implying between 22 and 27 platform placements during the year.

Singh said that those expectations may no longer be achievable as the pandemic has led to Vanadis installation delays. The Vanadis program continues to progress "very well," however, he said, and demand for the Vanadis NIPT remains high. As regions may open up in Q3 and Q4, the company is hopeful it may jumpstart installations of the system, Singh said.

Meanwhile, Discovery & Analytical Solutions segment revenues were down 10 percent year over year to $391.0 million from $434.0 million. Revenues were down also 10 percent on an organic basis.

By end market, life sciences revenues were down in the low single digits year over year during Q2 while pharma/biotech was up in the low single digits, and academic and government retreated in the high teens, Mock said.

Applied markets declined approximately 20 percent and food testing was down by more than 20 percent, and industrial and environmental safety was down in the high teens, he said.

The Waltham, Massachusetts-based company spent $49.5 million on R&D, up 2 percent from $48.3 million a year ago. Its SG&A costs grew 10 percent to $221.0 million from $201.6 million.

PerkinElmer had a profit of $137.2 million, or $1.23 per share, for the recently completed quarter compared to a profit of $69.1 million, or $.62 per share, in Q2 2019. Adjusted EPS was $1.57 and easily beat the consensus Wall Street estimate of $.88 per share.

The firm exited Q2 with $218.5 million in cash and cash equivalents.

For the third quarter, it is forecasting revenues to be in the range of $760 million to $860 million, with EPS from continuing operations in the range of $.85 to $1.20. Adjusted EPS is expected to be between $1.18 and $1.53.

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