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Bio-Rad Q4 Revenues Fall 5 Percent; Firm Gets CE IVD Mark for Droplet Digital PCR System

NEW YORK (GenomeWeb) – Bio-Rad said after the close of the market Thursday that its fourth quarter revenues slipped 5 percent year over year largely due to foreign currency effects.

Separately, the company announced that it has received CE IVD marking for its QX200 Droplet Digital PCR system, making it the first digital PCR system authorized for use as an in vitro diagnostic in the EU.

For the three months ended Dec. 31, 2015, the Hercules, California-based firm reported $570.6 million in revenues compared to $598.2 million in the year-ago period. On a currency-neutral basis, quarterly revenues increased 3 percent year over year.

Life Science segment sales were $218.1 million in Q4, down almost 3 percent from the same quarter last year, but up 3 percent on a currency-neutral basis. Bio-Rad said that segment results benefitted from currency-neutral increased sales in core businesses, particularly process chromatography media, Droplet Digital PCR, and cell biology products.

Meantime, Bio-Rad's Clinical Diagnostics segment revenues were $348.6 million in Q4, a 6 percent drop from the year-ago period but a 3 percent increase on a currency-neutral basis.

Bio-Rad's net income for the quarter was $49.5 million, or $1.68 per share, compared to $39.0 million, or $1.34 per share, in the year-ago period. The increase in net income was largely due to lower SG&A and R&D expenses as well as a lower effective tax rate in Q4.

The company reported $193.1 million in SG&A expenses in the quarter, down 7 percent from $207.5 million in Q4 2014, and $55.9 million in R&D expenses, down 6 percent from $59.3 million.

In its announcement about receiving CE IVD marking for the QX200 platform, Bio-Rad noted that the system or its predecessor, the QX100, have been available for research use only since 2011. The technology partitions a DNA or RNA sample into 20,000 droplets and amplifies targeted sequences within each droplet, allowing scientists to precisely detect and quantify low concentrations of target DNA and RNA sequences. This enables a range of important genomic applications, including cancer-mutation detection, gene copy-number determination, viral-load monitoring, and gene-edit detection.

For full-year 2015, Bio-Rad's revenues fell 7 percent to $2.02 billion from $2.18 billion in 2014. On a currency-neutral basis, 2015 revenues grew almost 2 percent.

On a conference call Thursday to recap Q4 and 2015 earnings, Bio-Rad CFO Christine Tsingos noted that this "dramatic swing reflects a currency headwind to sales of more than $190 million for the full year."

Life Science segment sales were $695.0 million in 2015, down 5 percent compared to 2014, but up almost 3 percent on a currency-neutral basis. Full-year Clinical Diagnostics revenues were $1.31 billion, down almost 9 percent compared to 2014, but up 1 percent on a currency-neutral basis.

Bio-Rad's 2015 net income was $113.1 million, or $3.85 per share, compared to $88.8 million, or $3.05 per share, in 2014. The net income increase was primarily due to lower SG&A and R&D expenses and currency effects in 2015. In addition, 2014 SG&A costs included approximately $23.7 million in non-recurring expense.

The firm's 2015 SG&A expenses fell 6 percent to $762.0 million from $808.2 million in 2014, while its R&D expenses shrunk 12 percent to $193.0 million from $220.3 million.

Bio-Rad exited the fourth quarter with $457.5 million in cash and cash equivalents and $332.9 million in short-term investments.

During the conference call, Tsingos said that the company expects currency-neutral sales growth in 2016 of 2.5 percent to 3 percent. This includes expected currency-neutral growth in the Life Science segment of 4 percent to 5 percent, and currency-neutral growth in Clinical Diagnostics of 1 percent to 1.5 percent.

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