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GenMark Q4, FY 2012 Revenues Jump Sharply

NEW YORK (GenomeWeb News) – GenMark Diagnostics reported after the close of the market Tuesday that its fourth-quarter revenues increased 364 percent year over year, driven by reagent sales from greater system placements.

The Carlsbad, Calif.-based molecular diagnostics firm had total revenues of $9.4 million for the three months ended Dec. 31, compared to $2 million for the fourth quarter of 2011. Its reagent sales were up more than 400 percent to $9.1 million from $1.8 million, while its instrument and other revenues climbed 39 percent to $312,000 from $224,000.

Analysts, on average, had expected revenues of $7.1 million.

Company officials said on a conference call following the release of the financial results that the firm placed 42 of its XT-8 molecular diagnostic systems during the quarter.

GenMark posted a net loss per share of $.15 versus $.27 for Q4 2011 and easily beat the Wall Street consensus estimate for a loss per share of $.21.

The firm didn't provide its R&D or SG&A expenses for the quarter.

"Boosted by a more severe than usual flu season, the continued expansion of our installed base and annuity per system enabled our commercial team to close out 2012 with another very robust quarter," GenMark President and CEO Hany Massarany said in a statement.

For full-year 2012, GenMark generated revenues of $20.5 million, up more than 300 percent from $5 million in 2011, and above the consensus estimate of $18.1 million.

Its reagent revenues grew 367 percent to $19.6 million from $4.2 million, while instrument revenues provided around $900,000 in revenue. The firm placed a total of 130 analyzers during the year, bringing its total installed base to 297. It said that the reagent annuity per analyzer increased from $51,000 to $143,000.

During the year, GenMark received US Food and Drug Administration clearance for its eSensor Respiratory Virus Panel, which simultaneously detects and differentiates 14 clinically relevant viruses from patients with influenza-like illness. The firm launched the test late in the third quarter, and Massarany said on the call that it contributed to revenue growth in the fourth quarter.

"We expect it to contribute even greater revenue in the current quarter given the strong flu season," he added.

GenMark posted a net loss of $22.1 million, or $.84 per share, for FY 2012, compared to a net loss of $24 million, or $1.45 per share, for FY 2011. Analysts, on average, expected a loss of $.92 for FY 2012.

The firm reported R&D spending of $13.5 million for the year, up 55 percent from $8.7 million in 2011, while its SG&A expenses for the year increased 24 percent to $17.2 million from $13.9 million.

GenMark closed the year with $52.6 million in cash, cash equivalents, and restricted cash.

"We plan to continue utilizing our cash balances primarily to invest in new products and menu development, mainly for our NexGen platform, as we continue the expansion of our commercial organization," GenMark CFO Richard Slansky said on the conference call.

The NexGen System, a sample-to-answer molecular diagnostics system that is intended to greatly expand the firm's laboratory customer base, is expected to launch later this year. The new system will integrate extraction and amplification and run both high and low multiplex assays.

The firm expects FY 2013 revenue growth of around 70 percent to approximately $35 million, with a disproportionate amount of the revenue coming in the first and fourth quarters of the year due to the seasonality of its Respiratory Viral Panel Test.

In Wednesday morning trade on the Nasdaq, shares of GenMark were up 12 percent at $12.35.

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