This story has been updated to include information from Bio-Rad's earnings call.
NEW YORK (GenomeWeb) – Bio-Rad Laboratories said after the close of the market Thursday that its fourth quarter revenues were up slightly year over year.
For the three months ended Dec. 31, 2016, the Hercules, California-based firm reported $571.5 million in revenues compared to $570.6 million in the year-ago period. On a currency-neutral basis, quarterly revenues increased approximately 1 percent year over year. On average, analysts had expected revenues of $570.1 million for the quarter.
Life science segment sales were $206.8 million in Q4, down 5 percent from the same quarter last year, and down 4 percent on a currency-neutral basis due to a tough-to-compare Q4 2015 and offset by strong sales of Droplet Digital PCR products.
Bio-Rad's clinical diagnostics segment revenues were $360.8 million in Q4, a 4 percent increase from the year-ago period and also a 4 percent increase on a currency-neutral basis.
In the quarter, Bio-Rad and Illumina formed a partnership, launching a single-cell sequencing platform in early February, and the firms have already sold some systems, Annette Tumulo, Bio-Rad's executive vice president of the digital biology group said on a call to discuss the earnings.
Bio-Rad's net loss for the quarter was $20.6 million, or $0.70 per share, compared to an income of $49.5 million, or $1.68 per share, in the year-ago period. The decrease in net income was largely due to several non-cash charges, including a $59.9 million goodwill and in-process R&Dimpairment associated with the GnuBio acquisition, increases in expenses related to the revaluation of contingent consideration, and increases in legal reserves, the firm said. Excluding the impairment and legal-related charges, the firm estimated on the call that EPS for the quarter would have been $0.98, below the average analysts' estimate of $1.03.
The company reported $220.0 million in SG&A expenses in the quarter, up 14 percent from $193.1 million in Q4 2015, and $57.5 million in R&D expenses, up 3 percent from $55.9 million.
For full-year 2016, Bio-Rad's revenues rose 2 percent to $2.07 billion from $2.02 billion in 2015, or 4 percent on a currency-neutral basis.
"We are encouraged by our overall topline performance for the year, which was higher than our guidance," Norman Schwartz, Bio-Rad's president and CEO, said in a statement. "All of this growth is organic and represents good progress for the year. Although our continued investment in our operations coupled with unusual expenses during the year affected our profitability, these investments are necessary to support growth and improved profitability for the years to come."
Life science segment sales were $730.7 million in 2016, up 5 percent compared to 2015, but up about 7 percent on a currency-neutral basis. Full-year clinical diagnostics revenues were $1.32 billion, up almost 1 percent compared to 2015, but up 3 percent on a currency-neutral basis.
Bio-Rad's 2016 net income was $28.1 million, or $0.95 per share, compared to $113.1 million, or $3.85 per share, in 2015. The year-over-year decrease in net income was primarily the result of lower margins, $62.3 million in non-cash impairment of goodwill and long-lived assets, increased SG&A expenses associated with various legal matters, $11.7 million in restructuring costs associated with the upcoming implementation of global ERP system in Western Europe, and increased purchase accounting.
The firm's 2016 SG&A expenses were up 7 percent to $816.7 million from $762.0 million in 2015, while its R&D expenses rose 7 percent to $205.9 million from $193.0 million.
Bio-Rad exited the fourth quarter with $456.3 million in cash and cash equivalents and $387.7 million in short-term investments.
For full-year 2017 Bio-Rad anticipates currency neutral revenue growth of approximately 4 percent, not including the impacts of the recent acquisition of RainDance. Bio-Rad CFO Christine Tsingos noted during the call that the addition of RainDance could add about $20 million in revenue and drive the firm's currency-neutral sales growth to 5 percent for the full year, but that the consolidation of RainDance could negatively impact operating income by $7 million to $10 million in 2017 bringing projected operating margin to below 7 percent for the year.
Bio-Rad's shares fell about 2 percent to $188.22 in Friday morning trading on the Nasdaq.