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PerkinElmer Q3 Revenues Spike 36 Percent

NEW YORK – PerkinElmer reported after the close of the market on Wednesday that its third quarter revenues jumped 36 percent year over year and beat the consensus Wall Street estimates for the top and bottom lines.

For the three months ended Sept. 30, the Waltham, Massachusetts-based firm posted revenues of $964.0 million compared to $706.9 million in the year-ago period. It beat analysts' average estimate of $841.2 million.

Organic revenue growth was 34 percent.

Fueling the growth during the quarter was the Diagnostics segment as revenues rose 93 percent to $540.4 million from $280.0 million a year ago. In particular, COVID-19-related business contributed $288 million in revenues during the recently completed quarter, offsetting a 6 percent year-over-year decline in non-COVID-19-related revenues, PerkinElmer President and CEO Prahlad Singh said on a conference call following the release of the financial results. He also noted that the firm recently signed a contract with the state of California to conduct COVID-19 testing in a new laboratory in Valencia. PerkinElmer has fully outfitted the lab, and starting on Nov. 1, it will be ready to process up to 40,000 samples each day with capacity increasing to 150,000 tests daily during Q1 2021, Singh said.

The COVID-19 business was driven primarily by PerkinElmer's PCR and RNA extraction businesses, and each contributed more than $100 million in revenues during Q3 2020, company CFO Jamey Mock said on the call, adding the firm has served more than 1,000 customers in their efforts against the coronavirus pandemic.

Overall, the Diagnostics segment saw strength in its immunodiagnostics business and applied genomics businesses, offsetting "modest declines" in the reproductive health franchise.

Immunodiagnostics revenues were up more than 90 percent year over year as Euroimmun grew in the high-single digits. Demand for PerkinElmer's RT-PCR portfolio was also strong, while serology-based testing for SARS-CoV-2 declined compared to Q2, which PerkinElmer expected, Mock said.

Applied genomics revenues were up more than 360 percent year over year on broad-based momentum across all geographies, Mock said. He noted particular strength in PerkinElmer's nucleic acid extraction and liquid handling product lines, which is expected to position the applied genomics business to expand broadly in the molecular diagnostics space in the post-pandemic world.

Reproductive health was down in the mid-single digits organically on lower newborn prenatal testing in Europe and Asia-Pacific.

"Early indications are that year-to-date birth rates are down high-single to low-double digits worldwide," he said.

Discovery and Analytical Solutions segment revenues retreated a fraction of 1 percent year over year to $423.6 million from $426.9 million, and growth in the life sciences end market was more than offset by weakness in the food and applied markets.

Life sciences revenues were up in the mid-single digits organically year over year, as was pharma/biotech revenues. Academic/government revenues were down in the high-single digits, and the applied markets business was down about 10 percent, Mock said, as funding delays impacted demand. Revenues in the food end market declined 20 percent, and industrial and environmental safety revenues were down in the high-single digits.

In Q3 2020, the company's R&D spending increased 10 percent to $50.1 million from $45.4 million a year ago, while its SG&A costs also rose 10 percent to $225.2 million from $204.2 million.

PerkinElmer's net income soared to $176.7 million, or $1.57 per share, in Q3 2020 compared to $58.6 million, or $.52 per share, a year ago. Adjusted EPS was $2.09 and surpassed the consensus Wall Street estimate of $1.50.

The company had $258.3 million in cash and cash equivalents as of the end of Q3.

For the fourth quarter, the firm expects revenues of between $1.12 billion and $1.23 billion. EPS is anticipated to be between $2.27 and $2.67, while adjusted EPS is forecast to be in the range of $2.60 to $3.00.