NEW YORK (GenomeWeb) – Alere reported today that its second quarter revenues decreased 3 percent year over year due in part to a negative foreign exchange impact, but grew between 3 and 4 percent on an organic basis.
Total revenues for the three months ended June 30, 2015 were $629.2 million, compared to $647.4 million in the year-ago quarter, and beating the average Wall Street expectation of $625.2 million.
"The second quarter is typically the weakest from a revenue and earnings standpoint for Alere due to seasonality," Namal Nawana, Alere's CEO and president, said in a call to recap the earnings.
"Q2 this year showed strong sequential growth despite the significant macro headwinds of $33 million dollars in negative impact from foreign exchange and $16 million less in seasonal flu sales compared to the first quarter of 2015," Nawana said.
Net revenues from product sales and services were $623.5 million, compared to $640.8 million a year ago, while license and royalty revenues were $5.7 million compared to $6.6 million a year ago.
Sales of the company's infectious disease products grew 1 percent to $177 million from $175 million, while consumer diagnostics revenues rose 13 percent to $25 million from $22 million. Meanwhile, cardiometabolic disease sales rose 2 percent to $214 million; toxicology revenues fell 7 percent to $157 million, and other revenues dropped 22 percent to $51 million.
In the quarter the Waltham, Massachusetts-based firm received clearance from the US Food and Drug Administration for its Strep A rapid molecular assay on the Alere i platform. The Alere i runs the first CLIA-waived molecular flu product and has a 12- to 18-month advantage in the market, Nawana noted.
"We believe we're extremely well positioned to capture increased molecular share in a rapidly expanding market; we're seeing excellent sales pipeline momentum building for Alere i going into Q3, including a large hospital network win just this last month," he said.
Following CLIA waiver for Strep A on Alere i, the firm is now seeing "strong interest" in that product, which "reinforces the value proposition of the Alere i platform" overall, Nawana said.
"Alere i will certainly be a big growth driver for us heading into the back half of this year," he said.
"We're a big player in lateral flow Strep … and we know how our customers want to work with this kind of product … so we feel that this will be a great add for us."
The firm has been actively marketing Alere i over the last few weeks in particular. "What we see is some great pipeline building, so our full expectation is to have a much larger installed base as we head into Q4, and we're really focused on network sales."
This year the firm has also received FDA approval on its Alere i multi-analyte software, 510(k) approval for a viral transport media claim for flu, and CE marking to begin marketing its other molecular platform, Alere q.
"We've received our first multi-million dollar order for Alere q, and have already shipped over half a million dollars worth of Alere q product in Q2," Nawana said. The win is in a "single African geography" and is for early infant HIV diagnosis.
Nawana noted that the ability of the Alere q platform to utilize both thermal cycling and isothermal technology will make the product "requisite for diseases that require high-sensitivity detection with molecular accuracy in a portable instrument."
Alere posted a profit of $14.6 million available to common stockholders, or $.17 per share, compared to a loss of $50.4 million, or $.61 per share, in Q2 2014. On a non-GAAP basis, EPS was $.54, in line with analysts' average estimate.
Its R&D costs were reduced 27 percent year over year to $27.2 million from $37.4 million, and its SG&A costs were cut 37 percent to $168 million from $266.4 million.
The company ended the quarter with $464.9 million in cash and cash equivalents, $461.6 million in restricted cash, and $175,000 in marketable securities.
For the year ending December 31, 2015, the company reaffirmed guidance of net revenue in the range of $2.5 billion to $2.6 billion, and non-GAAP adjusted net income in the range of $2.40 to $2.50 per diluted share.