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MDx Competition Dampens Meridian Bio's Q4 Revenues

NEW YORK (GenomeWeb) – Meridian Bioscience today said that its fiscal fourth quarter revenues declined by about 5 percent year over year as its diagnostics revenues slid 8 percent.

The Cincinnati-based firm said that for the three months ended Sept. 30, it recorded $46.7 million in total revenues, down from $49 million a year ago and below the consensus Wall Street estimate of $49 million.

The drop resulted from slower diagnostics revenues, which retreated to $34.4 million in the quarter, compared to $37.3 million a year ago. Life science revenues grew 5 percent to $12.3 million from $11.7 million.

Results for the quarter "continued to reflect the negative impact of our more competitive diagnostic markets, especially in the molecular testing category where multiple competitive testing platforms have been introduced in recent years," Meridian Bio Chairman and CEO John Kraeutler said in a statement. The decline in diagnostics revenues were due in large part to flattening sales of the company's illumigene molecular diagnostic products, although Kraeutler noted that the firm added 68 new illumigene customers while the illumigene Pertussis test saw continued acceptance during the fourth quarter. In September, Meridian Bio signed a deal with healthcare alliance Premier to offer illumigene tests.

Decreases in foodborne and legacy immunoassay product sales and weaker shipments to Meridian Bio's Japanese distributor also contributed to the softer diagnostics financial results.

Meanwhile, new molecular products, along with an expansion into the Asian markets and new industrial customers, drove the improvement in life science revenues, Kraeutler said.

Meridian Bio's profit for the quarter was $8.2 million, or $.20 per share, compared to a profit of $9.2 million, or $.22 per share, a year ago. The consensus analyst estimate was $.22 per share.

Its R&D spending grew 26 percent year over year to $3.4 million from $2.7 million, while its SG&A costs shrank 12 percent to $13.1 million from $14.9.

The company finished the fourth quarter with $43 million in cash and cash equivalents.

Meridian Bio said that its board declared a regular quarterly cash dividend of $.20 per share payable on Nov. 28 to shareholders of record on Nov. 17. It also approved a regular quarterly cash dividend rate of $.20 per share for fiscal 2015, or an annual indicated rate of $.80 per share.

Revenues for fiscal 2014 were essentially flat at $188.8 million, compared to $188.7 million in fiscal 2013. It missed the average Wall Street estimate of $191.3. Diagnostics revenues were down 2 percent year over year to $141.5 million from $144.6 million, and life science revenues were up 7 percent $47.3 million from $44.1 million.

Meridian Bio's profit for fiscal 2014 was $34.7 million, or $.83 per share, down from a profit of $38 million, or $.91 per share, in fiscal 2013, and below the average Wall Street expectation of $.86 per share.

Its R&D costs grew 17 percent year over year to $12.6 million from $10.8 million, and its SG&A costs were down 1 percent to $52.3 million from $52.9 million.

For fiscal 2015, the company reaffirmed its prior guidance for revenues to be in the range of $193 million to $200 million and for EPS to be in the range of $.85 to $.91.

In Thursday morning trading on the Nasdaq, shares of Meridian Bio were down 5 percent to $17.79.