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Meridian Bioscience Initiates Guidance for FY 2014, Reaffirms FY 2013 Guidance

NEW YORK (GenomeWeb News) – Meridian Bioscience today initiated sales and earnings guidance for its Fiscal Year 2014, while it reiterated prior guidance for full-year fiscal 2013.

For FY 2014, the Cincinnati-based company said that net sales are anticipated to be in the range of $203 million and $208 million. It guided to EPS of between $.98 and $1.03, saying net earnings are anticipated to increase between 10 and 15 percent compared to fiscal 2013.

For FY 2013, the company reaffirmed EPS of between $.86 and $.91 on net sales of between $190 million and $195 million. It added that current revenue expectations are at the low end of the range.

In a statement, Meridian Bio CEO John Kraeutler said that the firm's diagnostic business continued to expand its illumigene molecular menu during 2013, as well as its user base, while it also increased revenues in "the focus areas of foodborne and H. pylori testing."

The life science unit also added innovative new products and increased its global reach, he said.

"Our outlook is for solid growth in fiscal 2014, as we expect to increase organic revenues approximately 7 percent to 10 percent with earnings growing approximately 10 percent to 15 percent, demonstrating continued operating efficiency," Kraeutler said.

The illumigene molecular system and its tests for E. coli, Campylobacter, and H. pylori from the diagnostic business remained a prime growth driver in 2013, while the life science unit is expected to see growth from sales "of its unique molecular components, such as MyTaq and SensiFast, plus an expanding position in our industrial customer base in global markets, especially in China," Kraeutler said.

In 2014, the R&D focus will remain on building on the illumigene platform with tests for pertussis and chlamydia/gonorrhea expected to launch in the first half and second half of FY 2014, respectively.

The next tests in Meridian Bio's pipeline include Herpes Simplex I and II, enteric parasites including Giardia; foodborne pathogens, such as E. coli; and bloodborne pathogens, such as malaria, Kraeutler said. The company also will expand its automated manufacturing capabilities and increase its sales and marketing teams globally.

Meridian Bio Chairman William Motto added that based on the company's outlook, management plans on recommending to its board an increase in its indicated annual cash dividend at the next board meeting.

In a research note, Piper Jaffray analyst William Quirk said that while Meridian Bio reaffirmed its prior FY 2013 revenue guidance range, its wording that revenues are expected to be "near" the low end of its $190 million to $195 million range "introduces the possibility" that Meridian Bio's full-year 2013 revenues will not meet the low end of the range.

"We would note, if this is the case, this represents the fourth fiscal year in a row … where revenue guidance was either revised lower or was at the low end of initial expectations," Quirk said.

He added that he expects the company to experience share loss in its molecular diagnostics business, as a survey that Piper Jaffray conducted suggests some accounts may be converting to competitors including Cepheid, Becton Dickinson, and Quidel.

The investment bank is maintaining an Underweight rating on Meridian Bio.

In Monday afternoon trade on the Nasdaq, shares of Meridian Bio were up around 2 percent at $23.71.

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