Trinity Biotech plc (Nasdaq:TRIB), a leading developer and
manufacturer of diagnostic products for the point-of-care and
clinical laboratory markets, today announced results for the
quarter ended June 30, 2016.
Quarter 2 Results
Total revenues for Q2, 2016 were $26.3m compared
to $24.3m in Q2, 2015 which is an increase of 8%. However, when the
impact of foreign exchange movements, due to the strength of the US
dollar against a range of other currencies, is removed revenues
would have been $26.6m this quarter, thus representing an increase
of 10%.
Point-of-Care revenues for Q2, 2016 were $4.8m,
which represents an increase of $1.4m or 41% compared with the same
quarter last year. This increase was due to higher sales of HIV
kits in Africa.
Clinical Laboratory revenues for the quarter
were $21.5m. However, on a constant currency basis revenues
would have been $21.8m compared to $20.9m in Q2, 2015, an increase
of 5%. This increase was principally due to higher sales of
diabetes and autoimmune products.
Revenues for Q2, 2016 by key product area were
as follows:
|
|
|
|
|
|
2015Quarter 2 |
2016Quarter 2 |
2016Quarter 2FX
adjusted* |
Increase/(decrease) |
|
US$’000 |
US$’000 |
US$’000 |
% |
Point-of-Care |
3,371 |
4,786 |
4,769 |
|
41.5 |
% |
Clinical Laboratory |
20,886 |
21,502 |
21,844 |
|
4.6 |
% |
Total |
24,257 |
26,288 |
26,613 |
|
9.7 |
% |
* quarter 2, 2016 revenues have been
recalculated on a constant currency basis using the exchange rates
prevailing in Q2, 2015 |
|
Gross profit for Q2, 2016 amounted to $11.8m,
representing a gross margin of 45.0%. Whilst this is lower than the
47.0% achieved in Q2, 2015, it does represent an improvement on the
43.1% reported in Q1 of this year and this is mainly attributable
to the impact of higher margin HIV revenues.
Research and Development expenses have remained
consistent with the equivalent quarter last year at $1.3m.
Meanwhile, Selling, General and Administrative (SG&A) expenses
have increased over the same period from $6.7m to $7.8m. This
increase is due to the combination of foreign exchange rate factors
and increased discretionary sales and marketing expenditure which
includes pre-launch cardiac costs.
The net financing expense for the quarter was
$121,000 versus $98,000 in the equivalent quarter in 2015. This
expense can be broken down into its component parts as follows:
|
|
|
Net financing expense |
Q2 2016 |
Q2 2015 |
|
US$’000 |
US$’000 |
Financial income |
|
223 |
|
|
93 |
|
|
|
|
Financial expense – Exchangeable note |
|
(1,150 |
) |
|
(1,134 |
) |
Other financial expenses |
|
(35 |
) |
|
(35 |
) |
|
|
(1,185 |
) |
|
(1,169 |
) |
|
|
|
Non-cash financial income |
|
1,020 |
|
|
1,150 |
|
Non-cash financial expense – accretion interest |
|
(179 |
) |
|
(172 |
) |
|
|
841 |
|
|
978 |
|
|
|
|
Net financial expense |
|
(121 |
) |
|
(98 |
) |
|
|
|
|
|
|
|
Financial income increased to $223,000 from
$93,000 in the equivalent quarter last year. This was primarily due
to improved interest rates and a different time profile of
deposits.
Financial expenses primarily consist of the cash
interest payable on the Company’s exchangeable notes, which is
$1.15m per quarter. The equivalent expense in 2015 is slightly
lower than this due to the fact that the note offering closed on
April 9, 2015 and so a full quarter of interest was not
incurred.
Non-cash financial income represents adjustments
required to the fair value of the derivatives embedded in the
exchangeable notes along with an amount to accrete the fair value
of the debt liability back to its nominal value ($115 million) over
the term of the debt using an effective interest rate methodology.
For Q2, 2016, the fair value adjustment was a gain to the income
statement of $1m.
The tax charge for Q2, 2016 was $0.1m which
equates to an effective tax rate of approximately 6% and is broadly
in line with the effective rate of 7% in Q2, 2015.
Profit before tax for the quarter was $2.2m
compared to $2.9m in Q2, 2015. Meanwhile, profit after tax
for the quarter was $2.1m versus $2.7m for the comparative quarter.
EPS for the quarter was 9.1 cents which compares to 11.6
cents for the equivalent period last year. The fully diluted EPS
for the quarter was 8.5 cents.
Earnings before interest, tax, depreciation,
amortisation and share option expense for the quarter was
$4.4m.
Cardiac Update
In December, 2015 Trinity submitted a 510(k)
application for its Meritas Troponin I Test and the Meritas
Point-of-Care Analyzer to the FDA. The FDA’s review of the
application is proceeding according to our expectations. As
previously announced, as part of this review process, additional
clinical data were requested, and this clinical work will be
completed within the next two weeks enabling us to provide a
response to the FDA during August, 2016.
The US clinical validation studies in support of
a 510(k) submission to the US FDA for a second cardiac marker
assay, B-type Natriuretic Protein (BNP), are progressing well.
There are 10 clinical sites, across the US, that have been actively
enrolling patient samples. Overall enrolment is currently at 90% of
study target, with completion of enrolment anticipated by the end
of July, 2016. We are anticipating submission of our BNP 510(k)
application to the FDA by the end of Q3, 2016.
Share Buyback
The Company announced the commencement of a
share repurchase program in March, 2016. During the quarter, the
Company repurchased 406,000 ADRs at an average price of $11.14,
representing a total value of $4.5m.
For the year to date, the Company has
repurchased 538,000 ADRs, at an average price of $11.20. The total
spent on share repurchases for the year to date has been $6.0m.
Comments
Commenting on the results, Kevin Tansley, Chief
Financial Officer, said “Operating profit for the quarter was
$2.4m. This was lower than that achieved in Q2, 2015 partly due to
tighter gross margins – which is partly due to the impact of
exchange rate movements. In addition we are seeing the impact
of higher indirect costs again due to exchange rate factors as well
as higher sales and marketing costs. However, when compared
to Q1 this year, operating profits and EPS have increased by
approximately 30%, with the key factor being the growth in revenues
this quarter.”
Ronan O’Caoimh, CEO, stated “We were very
pleased with the revenue growth of 10% achieved this quarter. This
was due to higher HIV sales in Africa and strong growth in our
diabetes and autoimmune product lines.
In terms of our cardiac products we have made
very significant progress. We have almost completed the patient
enrolment to support the additional data requested by the FDA
following its initial review of our Troponin submission. This
data will form part of a full and comprehensive response document,
which will be submitted to the FDA in August, in order to address
all of its queries. Meanwhile, we are on the verge of completing
our clinical trials for our BNP product and remain on target to
make our 510(k) submission to the FDA by the end of Q3, 2016. Both
of these products are key to our strategic development and we are
very pleased to be reaching these regulatory milestones on the road
to obtaining FDA approvals.”
Litigation Reform Act of 1995. Investors are
cautioned that such forward-looking statements involve risks and
uncertainties including, but not limited to, the results of
research and development efforts, the effect of regulation by the
United States Food and Drug Administration and other agencies, the
impact of competitive products, product development
commercialisation and technological difficulties, and other risks
detailed in the Company's periodic reports filed with the
Securities and Exchange Commission.
Trinity Biotech develops, acquires, manufactures
and markets diagnostic systems, including both reagents and
instrumentation, for the point-of-care and clinical laboratory
segments of the diagnostic market. The products are used to detect
infectious diseases and to quantify the level of Haemoglobin A1c
and other chemistry parameters in serum, plasma and whole blood.
Trinity Biotech sells direct in the United States, Germany, France
and the U.K. and through a network of international distributors
and strategic partners in over 75 countries worldwide. For further
information please see the Company's website:
www.trinitybiotech.com.
|
|
|
|
|
|
Trinity Biotech plc |
Consolidated Income Statements |
|
|
|
|
|
|
(US$000’s except
share data) |
|
Three
MonthsEndedJune
30,2016(unaudited) |
Three
MonthsEndedJune
30,2015(unaudited) |
Six
MonthsEndedJune
30,2016(unaudited) |
Six
MonthsEndedJune
30,2015(unaudited) |
|
|
|
|
|
|
Revenues |
|
|
26,288 |
|
|
|
24,257 |
|
|
|
49,804 |
|
|
|
49,267 |
|
|
|
|
|
|
|
Cost of sales |
|
|
(14,472 |
) |
|
|
(12,864 |
) |
|
|
(27,856 |
) |
|
|
(25,869 |
) |
|
|
|
|
|
|
Gross
profit |
|
|
11,816 |
|
|
|
11,393 |
|
|
|
21,948 |
|
|
|
23,398 |
|
Gross profit % |
|
|
45.0 |
% |
|
|
47.0 |
% |
|
|
44.1 |
% |
|
|
47.5 |
% |
|
|
|
|
|
|
Other operating
income |
|
|
72 |
|
|
|
72 |
|
|
|
141 |
|
|
|
150 |
|
|
|
|
|
|
|
Research
& development expenses |
|
|
(1,267 |
) |
|
|
(1,269 |
) |
|
|
(2,414 |
) |
|
|
(2,267 |
) |
Selling, general and
administrative expenses |
|
|
(7,797 |
) |
|
|
(6,713 |
) |
|
|
(14,758 |
) |
|
|
(12,905 |
) |
Indirect share based
payments |
|
|
(468 |
) |
|
|
(473 |
) |
|
|
(735 |
) |
|
|
(1,031 |
) |
|
|
|
|
|
|
Operating
profit |
|
|
2,356 |
|
|
|
3,010 |
|
|
|
4,182 |
|
|
|
7,345 |
|
|
|
|
|
|
|
Financial income |
|
|
223 |
|
|
|
93 |
|
|
|
443 |
|
|
|
94 |
|
Financial expenses |
|
|
(1,185 |
) |
|
|
(1,169 |
) |
|
|
(2,366 |
) |
|
|
(1,193 |
) |
Non-cash financial
income |
|
|
841 |
|
|
|
978 |
|
|
|
(1,188 |
) |
|
|
978 |
|
Net financing
expense |
|
|
(121 |
) |
|
|
(98 |
) |
|
|
(3,111 |
) |
|
|
(121 |
) |
|
|
|
|
|
|
Profit before
tax |
|
|
2,235 |
|
|
|
2,912 |
|
|
|
1,071 |
|
|
|
7,224 |
|
|
|
|
|
|
|
Income tax expense |
|
|
(131 |
) |
|
|
(218 |
) |
|
|
(313 |
) |
|
|
(522 |
) |
Profit for the
period |
|
|
2,104 |
|
|
|
2,694 |
|
|
|
758 |
|
|
|
6,702 |
|
|
|
|
|
|
|
Earnings per ADR (US
cents) |
|
|
9.1 |
|
|
|
11.6 |
|
|
|
3.3 |
|
|
|
29.0 |
|
|
|
|
|
|
|
Earnings per ADR excluding
non-cash financial income (US cents) |
|
|
5.5 |
|
|
|
7.4 |
|
|
|
8.4 |
|
|
|
24.8 |
|
|
|
|
|
|
|
Diluted earnings per ADR
(US cents) |
|
|
8.5 |
|
|
|
9.9 |
|
|
|
14.9* |
|
|
|
26.1 |
|
|
|
|
|
|
|
Weighted average no. of
ADRs used in computing basic earnings per ADR |
|
|
23,016,169 |
|
|
|
23,195,016 |
|
|
|
23,152,018 |
|
|
|
23,090,704 |
|
Weighted average no. of
ADRs used in computing diluted earnings per ADR |
|
|
28,409,024 |
|
|
|
28,812,187 |
|
|
|
28,526,486 |
|
|
|
26,285,071 |
|
* Under IAS 33 Earnings per Share, diluted earnings per share
cannot be anti-dilutive. Therefore, diluted earnings per ADR in
accordance with IFRS would be 3.3 cents (i.e. equal to basic
earnings per ADR).
The above financial statements have been prepared in accordance
with the principles of International Financial Reporting Standards
and the Company’s accounting policies but do not constitute an
interim financial report as defined in IAS 34 (Interim Financial
Reporting).
|
|
|
|
Trinity Biotech plc |
Consolidated Balance Sheets |
|
|
|
|
|
June 30,2016US$
‘000(unaudited) |
March 31,2016US$
‘000(unaudited) |
Dec 31,2015US$
‘000(audited) |
ASSETS |
|
|
|
Non-current
assets |
|
|
|
Property, plant and
equipment |
|
21,760 |
|
|
21,460 |
|
|
20,659 |
|
Goodwill and intangible
assets |
|
169,049 |
|
|
165,157 |
|
|
161,324 |
|
Deferred tax assets |
|
13,312 |
|
|
13,096 |
|
|
12,792 |
|
Other assets |
|
932 |
|
|
860 |
|
|
954 |
|
Total non-current
assets |
|
205,053 |
|
|
200,573 |
|
|
195,729 |
|
|
|
|
|
Current
assets |
|
|
|
Inventories |
|
39,253 |
|
|
35,709 |
|
|
35,125 |
|
Trade and other
receivables |
|
27,832 |
|
|
26,260 |
|
|
25,602 |
|
Income tax receivable |
|
712 |
|
|
664 |
|
|
550 |
|
Cash and cash
equivalents |
|
84,920 |
|
|
96,829 |
|
|
101,953 |
|
Total current
assets |
|
152,717 |
|
|
159,462 |
|
|
163,230 |
|
|
|
|
|
TOTAL
ASSETS |
|
357,770 |
|
|
360,035 |
|
|
358,959 |
|
|
|
|
|
EQUITY AND
LIABILITIES |
|
|
|
Equity
attributable to the equity holders of the parent |
|
|
|
Share capital |
|
1,221 |
|
|
1,220 |
|
|
1,220 |
|
Share premium |
|
15,575 |
|
|
15,521 |
|
|
15,526 |
|
Accumulated surplus |
|
197,588 |
|
|
199,453 |
|
|
201,951 |
|
Other reserves |
|
(3,721 |
) |
|
(3,723 |
) |
|
(4,809 |
) |
Total
equity |
|
210,663 |
|
|
212,471 |
|
|
213,888 |
|
|
|
|
|
Current
liabilities |
|
|
|
Income tax payable |
|
657 |
|
|
1,026 |
|
|
1,163 |
|
Trade and other
payables |
|
19,384 |
|
|
19,195 |
|
|
18,874 |
|
Provisions |
|
75 |
|
|
75 |
|
|
75 |
|
Total current
liabilities |
|
20,116 |
|
|
20,296 |
|
|
20,112 |
|
|
|
|
|
Non-current
liabilities |
|
|
|
Exchangeable senior note
payable |
|
99,232 |
|
|
100,073 |
|
|
98,044 |
|
Other payables |
|
1,986 |
|
|
2,057 |
|
|
2,096 |
|
Deferred tax
liabilities |
|
25,773 |
|
|
25,138 |
|
|
24,819 |
|
Total non-current
liabilities |
|
126,991 |
|
|
127,268 |
|
|
124,959 |
|
|
|
|
|
TOTAL
LIABILITIES |
|
147,107 |
|
|
147,564 |
|
|
145,071 |
|
|
|
|
|
TOTAL EQUITY AND
LIABILITIES |
|
357,770 |
|
|
360,035 |
|
|
358,959 |
|
|
|
|
|
|
|
|
|
|
|
The above financial statements have been prepared in accordance
with the principles of International Financial Reporting Standards
and the Company’s accounting policies but do not constitute an
interim financial report as defined in IAS 34 (Interim Financial
Reporting).
|
|
|
|
|
Trinity Biotech plc |
Consolidated Statement of Cash Flows |
|
|
|
|
|
(US$000’s) |
Three
MonthsEndedJune
30,2016(unaudited) |
Three
MonthsEndedJune
30,2015(unaudited) |
Six
MonthsEndedJune
30,2016(unaudited) |
Six
MonthsEndedJune
30,2015(unaudited) |
|
|
|
|
|
Cash and cash
equivalents at beginning of period |
|
96,829 |
|
|
|
|
5,744 |
|
|
101,953 |
|
|
9,102 |
|
|
|
|
|
|
Operating cash flows
before changes in working capital |
|
5,282 |
|
|
|
|
4,130 |
|
|
7,786 |
|
|
10,428 |
|
Changes in working
capital |
|
(3,234 |
) |
|
|
|
(2,906 |
) |
|
(3,862 |
) |
|
(7,225 |
) |
Cash generated from
operations |
|
2,048 |
|
|
|
|
1,224 |
|
|
3,924 |
|
|
3,203 |
|
|
|
|
|
|
Net Interest and Income
taxes (paid)/received |
|
149 |
|
|
|
|
(223 |
) |
|
(92 |
) |
|
(332 |
) |
|
|
|
|
|
Capital Expenditure &
Financing (net) |
|
(5,995 |
) |
|
|
|
(7,218 |
) |
|
(11,427 |
) |
|
(11,334 |
) |
|
|
|
|
|
Free cash flow |
|
(3,798 |
) |
|
|
|
(6,217 |
) |
|
(7,595 |
) |
|
(8,463 |
) |
|
|
|
|
|
Share buyback |
|
(4,699 |
) |
|
|
|
- |
|
|
(6,026 |
) |
|
- |
|
|
|
|
|
|
Payment of HIV-2 licence
fee |
|
(1,112 |
) |
|
|
|
- |
|
|
(1,112 |
) |
|
(1,112 |
) |
|
|
|
|
|
30 year Convertible Note
interest payment |
|
(2,300 |
) |
|
|
|
- |
|
|
(2,300 |
) |
|
- |
|
|
|
|
|
|
30 year Convertible Note
proceeds, net of fees |
|
- |
|
|
|
|
110,730 |
|
|
- |
|
|
110,730 |
|
|
|
|
|
|
Cash and cash
equivalents at end of period |
|
84,920 |
|
|
|
|
110,257 |
|
|
84,920 |
|
|
110,257 |
|
|
|
|
|
|
The above financial statements have been prepared in accordance
with the principles of International Financial Reporting Standards
and the Company’s accounting policies but do not constitute an
interim financial report as defined in IAS 34 (Interim Financial
Reporting).
Contact:
Trinity Biotech plc
Kevin Tansley
(353)-1-2769800
E-mail: kevin.tansley@trinitybiotech.com
Lytham Partners LLC
Joe Diaz, Joe Dorame & Robert Blum
602-889-9700
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