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 fiscal
year 2013 and the quarter ended December 31, 2013.
Fiscal year 2013 Results
Total revenues for fiscal year 2013 were $91.2m versus $82.5m in
2012, thus representing an increase of 10.6% year on year.
Point-of-care revenues increased by over 3% from $19.2m in 2012
to $19.8m in 2013. This growth was due to the continuing strength
of HIV sales in Africa.
Meanwhile, Clinical Laboratory revenues grew by almost 13% and
this was due to a number of factors as follows:
- higher Diabetes sales driven by increased Premier
placements;
- the impact of the Immco and blood bank screening acquisitions
made during the year; and
- higher sales of infectious diseases products in China.
This was partly offset by lower Lyme sales due to the impact of
adverse weather conditions in eastern USA, particularly in the
first half of 2013.
Revenues for Q4 and fiscal year 2013 by key product area were as
follows:
|
2012 Quarter 4 |
2013 Quarter 4 |
Q4 2013 vs Q4 2012 |
Full Year 2012 |
Full Year 2013 |
Full Year 2013 vs 2012 |
|
US$'000 |
US$'000 |
% |
US$'000 |
US$'000 |
% |
Point-of-Care |
4,872 |
5,088 |
4.4% |
19,154 |
19,754 |
3.1% |
|
|
|
|
|
|
|
Clinical Laboratory |
15,952 |
20,367 |
27.7% |
63,356 |
71,462 |
12.8% |
|
|
|
|
|
|
|
Total |
20,824 |
25,455 |
22.2% |
82,510 |
91,216 |
10.6% |
The other key financial results for 2013 were as follows:
- Operating profit grew by 4.1% from $17.2m to $17.9m. This
represents an operating margin of 19.6%.
- Profit before Medical Device Excise Tax (MDET) and once-off
charges increased from $17.3m to $17.8m, representing an annual
growth rate of 3%.
- EBITDA and before share option expense for the year increased
from $21.7m to $23.5m.
The above items are before the impact of once-off charges
associated with taking a HIV-2 licence and restructuring costs
associated with the blood bank screening business acquired from
Lab21.
Overall the profit for the year was impacted by a number of
factors:
- Prior to the launch of our new cardiac products, the company
has started to put in place a sales and marketing function
dedicated to the launch and support of these products. To date the
cost of this function has not been offset by any associated
revenues, which are only due to commence in 2014;
- Higher running costs associated with the two blood bank
screening manufacturing facilities in the UK. These facilities will
be closed in mid-2014, following the transfer of manufacturing to
Trinity's facilities in Ireland and New York; and
- Integration and transaction costs incurred in Immco in the
period post acquisition.
The tax charge for the year was 6.75% which compares favourably
to the 10.4% reported in 2012. This low taxation rate reflects the
advantage of the low corporate tax rates and R&D tax credits
which apply in Ireland.
Key Achievements in 2013
Cardiac
2013 was a key year for the development of our new point-of-care
products on our Meritas platform. In particular, we achieved
design freeze on our Troponin I test during quarter 2, which was
then followed by CE marking trials during the second half of the
year. The results demonstrated in these trials were excellent
and consequently CE marking (effectively EU regulatory approval)
was obtained in early 2014. The Meritas Troponin test demonstrates
unrivalled sensitivity and precision in the point-of-care
environment making it the only test on the market capable of
detecting heart attacks in accordance with all of the performance
guidelines issued by the world's leading cardiac
organisations. FDA trials for this product are now about to
commence in the USA. Based on its high clinical and guideline
compliant performance, we are confident of meeting and indeed
exceeding the stringent requirements for FDA approval. FDA
submission is targeted for the second half of 2014 with approval
anticipated in early 2015.
In addition, we made significant progress on the second test to
be launched on the Meritas platform, BNP – a test for determining
risk of heart failure. We are anticipating obtaining CE Marking for
this product in mid-2014 with FDA submission to follow in Q4 2014.
We have now identified D-dimer as the next product to be launched
on this platform and have already commenced the development
process. Trinity will take advantage of the high precision
testing, which this unique technology is capable of, to develop a
range of other point-of-care tests on this
platform.
Premier
It was another very successful year for our new diabetes
instrument, the Premier. We achieved our target for
instruments shipped during 2013 with strong sales in a wide range
of markets including USA, Europe, China, South-East Asia and South
America. The most important development during 2013 was
obtaining regulatory approval for the instrument in China, a market
in which we believe we can sell in excess of 100 instruments
p.a. We are also very pleased to announce that we have just
obtained regulatory approval in Brazil and are expecting to make
our first sales of Premier instruments in Q1, 2014. We also
completed development of the ion exchange version of the Premier,
which will have particular applicability in certain geographic
areas, such as the Mediterranean region.
Acquisition of Immco
In Q2, 2013 we acquired Immco Diagnostics Inc. for
$32.9m. Immco is a Buffalo based diagnostics company, which
specialises in the development, manufacture and sale of autoimmune
products. The product line, which is fully FDA approved, is
complemented by a US reference laboratory business offering
specialised immunology, pathology and immunogenetics testing. The
company possesses the best range of IFA autoimmune products in the
world and an ELISA range of products that at least matches the
market leaders. Trinity expects to grow the business by 20%
p.a. This will be achieved by leveraging Trinity's sales force and
instrument base in the USA, using Trinity's established
international distributor network to reach new markets and by
exploiting the synergies between Trinity's existing infectious
diseases and Immco's autoimmune product ranges. In addition, at the
time of acquisition Immco was in the process of launching a number
of recently developed products including a new test for detecting
Sjogren's Syndrome.
Acquisition of blood bank screening business from
Lab21
In Q4, 2013 we announced the acquisition of the blood bank
screening business of UK based diagnostics company Lab21 Limited
for $7.5m. The business includes high quality TPHA and ELISA
products for screening blood banks with a particular emphasis on
syphilis and malaria testing. The syphilis products acquired
already have a market share of over 75% of the syphilis blood bank
markets in the UK, France, Germany, Netherlands, Switzerland,
Austria and Belgium. It is Trinity's intention to further grow the
business by expanding beyond its traditional markets in Western
Europe, by bringing its products to the USA and developing markets.
We are also in the process of transferring its manufacturing
operations from its existing UK plants to Trinity's facilities in
Ireland and the USA.
Rapid products
During 2013, we obtained CE marking for a number of our rapid
point-of-care tests being developed in our San Diego facility. We
now have nine new point-of-care tests which have been CE marked and
are being launched through a wide range of distributors within
Europe. In addition to having been CE marked, the tests for
Cryptosporidium, Giardia, Syphilis and HSV2 are also FDA approved
whilst our H-pylori test will be submitted to the FDA in Q3
2014.
HIV-2 Claim
Trinity obtained FDA approval for a HIV-2 claim for its
Uni-Gold™ platform Recombigen® HIV rapid product. Previously the
product had a claim for HIV-1 only. This had restricted the market
in which Trinity was able to compete as some health body tenders
required both strains to be detectable. Furthermore, Trinity
had been at a competitive disadvantage due to the more favourable
reimbursement rates paid in respect of HIV-1/2 testing versus HIV-1
only. Management believe that this new claim will enable this
product to grow in the years ahead following a 4-5% decline in
recent years due to reduced federal funding for HIV testing.
Dividend
The annual dividend was increased by 33% from 15 cents per ADR
to 20 cents per ADR. This follows an increase in the previous year
from 10 cents to 15 cents.
Quarter 4
Results
Total revenues for Q4, 2013 were $25.5m which compares to $20.8m
in Q4, 2012, an increase of 22.2%.
Point-of-Care revenues for Q4, 2013 increased by 4.4% when
compared to Q4, 2012. This increase reflects the growth in HIV
revenues in Africa.
Clinical Laboratory revenues increased from $16.0m to $20.4m,
which represents an increase of 27.7% compared to Q4, 2012. This
was partly due to the impact of acquisitions, increased Premier
revenues and higher sales of infectious diseases products in China.
Gross margin for the quarter was 50.4% which is slightly lower
that the 50.6% reported in Q4, 2012.
Research and Development expenses were $1.0m, which represents
an increase of 35% compared to the corresponding period last
year. Meanwhile, Selling, General and Administrative
(SG&A) expenses have also increased, from $5.2m to $6.5m. In
both cases, the increase was primarily attributable to the impact
of acquisitions undertaken during 2013.
Operating profit for the quarter was over $5.0m, which
represents an increase of approximately 15% over the $4.4m reported
in Q4, 2012. The operating margin for the quarter was 19.8%.
Profit before tax increased from $4.9m to $5.2m, while profit
after tax increased from $4.5m to $4.8m, an increase of over 8%.
Meanwhile, EPS for the quarter increased by 4% from 20.8 cents to
21.7 cents. Each of the above metrics is before the impact of the
Medical Device Excise Tax (MDET) which was introduced in 2013.
Comments
Commenting on the Q4, 2013 results, Kevin Tansley, Chief
Financial Officer, said "We achieved very strong operating profits
during the quarter. The increase from $4.4m to over $5m
represented an increase of 15% quarter on quarter, which equates to
an operating margin of approximately 20%. We have continued
our trend of growing profit after tax which increased by 8% for the
quarter. EPS for the quarter grew from 20.8 cents to 21.7 cents
versus the same quarter last year."
Ronan O'Caoimh, CEO of Trinity said
"During 2013, we focussed on identifying, creating and
developing a range of growth opportunities. Of key importance was
the completion of our Meritas Troponin test – the only
point-of-care test capable of detecting heart attacks in the
point-of-care environment in accordance with the guidelines issued
by the world's leading cardiac organisations. Successful clinical
trials carried out in late 2013, demonstrated excellent results in
the emergency room environment and resulted in the granting of EU
regulatory approval. This will soon be followed by FDA
submission, which is targeted for the second half of 2014. FDA
approval will give us access to a $350m market with a unique and
best-in-class product. We also made significant progress with our
test for BNP, which will be the next test to be launched on the
Meritas platform, and one which has a market size of $300m. CE
marking for this product is expected in mid-2014, to be followed by
FDA submission in Q4 2014. These two tests, in addition to a
range of other tests which we intend to launch on this platform
will serve as a major revenue growth engine for the company in the
years ahead.
We were also successful in continuing to grow our diabetes
business particularly on our Premier platform. Of critical
importance was obtaining regulatory approval in China where we have
already made significant instrument sales. Similarly, I am
very happy to be announcing today that we have now received
regulatory approval for the Premier in Brazil, where we expect to
make immediate and significant inroads in to what is a very large
and growing market.
During 2013, we also completed two acquisitions – the Buffalo
based autoimmune diagnostics company, Immco Diagnostics, and the
blood bank screening business of Lab21 Limited in the UK. Both
of these have excellent quality products, making them ideally
suited to take advantage of the growing sectors of the diagnostics
markets in which they compete. This growth will be further
augmented by exploiting the many synergies which will come from
integrating these entirely complementary product lines into
Trinity's existing product offering and taking advantage of our US
sales force and international distribution network.
I believe that the company is now ideally positioned for a
period of strong growth across a range of product lines with a
particular emphasis on high growth geographic and product
markets."
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 Months |
Three Months |
Year |
Year |
|
Ended |
Ended |
Ended |
Ended |
|
Dec 31, |
Dec 31, |
Dec 31, |
Dec 31, |
|
2013 |
2012 |
2013 |
2012 |
|
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
|
|
|
|
|
Revenues |
25,455 |
20,824 |
91,216 |
82,510 |
|
|
|
|
|
Cost of sales |
(12,637) |
(10,290) |
(45,305) |
(40,257) |
|
|
|
|
|
Gross profit |
12,818 |
10,534 |
45,911 |
42,253 |
Gross profit % |
50.4% |
50.6% |
50.3% |
51.2% |
|
|
|
|
|
Other operating income |
247 |
93 |
532 |
468 |
|
|
|
|
|
Research & development expenses |
(1,035) |
(765) |
(3,691) |
(3,130) |
Selling, general and administrative
expenses |
(6,481) |
(5,159) |
(22,901) |
(20,750) |
Indirect share based payments |
(521) |
(314) |
(1,978) |
(1,675) |
|
|
|
|
|
Operating profit |
5,028 |
4,389 |
17,873 |
17,166 |
|
|
|
|
|
Financial income |
132 |
532 |
1,300 |
2,280 |
Financial expenses |
-- |
(26) |
(75) |
(88) |
Net financing income |
132 |
506 |
1,225 |
2,192 |
|
|
|
|
|
Profit before tax |
5,160 |
4,895 |
19,098 |
19,358 |
|
|
|
|
|
Income tax expense |
(328) |
(426) |
(1,290) |
(2,017) |
|
|
|
|
|
Profit for the period before MDET and
once-off charges |
4,832 |
4,469 |
17,808 |
17,341 |
|
|
|
|
|
Once-off charges |
-- |
-- |
(8,187) |
-- |
Tax credit on once-off charges |
-- |
|
716 |
|
Medical device excise tax (MDET) |
(191) |
-- |
(691) |
-- |
|
|
|
|
|
Profit for the period after MDET and
once-off charges |
4,641 |
4,469 |
9,646 |
17,341 |
|
|
|
|
|
Earnings per ADR (US cents) |
20.8 |
20.8 |
44.0 |
81.0 |
|
|
|
|
|
Diluted earnings per ADR (US cents) |
19.2 |
19.8 |
41.2 |
77.3 |
|
|
|
|
|
Earnings per ADR excluding MDET and once-off
charges (US cents) |
21.7 |
20.8 |
81.2 |
81.0 |
|
|
|
|
|
Diluted earnings per ADR excluding MDET and
once-off charges (US cents) |
20.0 |
19.8 |
76.0 |
77.3 |
|
|
|
|
|
Weighted average no. of ADRs used in
computing basic earnings per ADR |
22,261,568 |
21,476,973 |
21,936,647 |
21,418,821 |
Weighted average no. of ADRs used in
computing diluted earnings per ADR |
24,218,493 |
22,563,207 |
23,428,174 |
22,443,404 |
|
Trinity Biotech
plc |
Consolidated Balance
Sheets |
|
|
|
|
|
Dec 31, |
Sept 30, |
Dec 31, |
|
2013 |
2013 |
2012 |
|
US$ '000 |
US$ '000 |
US$ '000 |
|
(unaudited) |
(unaudited) |
(audited) |
ASSETS |
|
|
|
Non-current assets |
|
|
|
Property, plant and equipment |
12,991 |
12,090 |
8,883 |
Goodwill and intangible assets |
128,547 |
126,324 |
73,046 |
Deferred tax assets |
7,044 |
5,935 |
4,073 |
Other assets |
1,162 |
1,011 |
908 |
Total non-current
assets |
149,744 |
145,360 |
86,910 |
|
|
|
|
Current assets |
|
|
|
Inventories |
29,670 |
27,387 |
20,757 |
Trade and other receivables |
24,268 |
23,119 |
14,457 |
Income tax receivable |
487 |
208 |
336 |
Cash and cash equivalents |
22,317 |
26,806 |
74,947 |
Total current assets |
76,742 |
77,520 |
110,497 |
|
|
|
|
TOTAL ASSETS |
226,486 |
222,880 |
197,407 |
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
Equity attributable to the equity
holders of the parent |
|
|
|
Share capital |
1,182 |
1,169 |
1,134 |
Share premium |
8,732 |
7,006 |
5,138 |
Accumulated surplus |
168,772 |
163,039 |
158,973 |
Other reserves |
4,325 |
3,916 |
4,135 |
Total equity |
183,011 |
175,130 |
169,380 |
|
|
|
|
Current liabilities |
|
|
|
Income tax payable |
770 |
1,347 |
1,092 |
Trade and other payables |
20,131 |
21,587 |
11,824 |
Provisions |
75 |
50 |
50 |
Total current
liabilities |
20,976 |
22,984 |
12,966 |
|
|
|
|
Non-current liabilities |
|
|
|
Other payables |
4,596 |
5,959 |
4,318 |
Deferred tax liabilities |
17,903 |
18,807 |
10,743 |
Total non-current
liabilities |
22,499 |
24,766 |
15,061 |
|
|
|
|
TOTAL LIABILITIES |
43,475 |
47,750 |
28,027 |
|
|
|
|
TOTAL EQUITY AND
LIABILITIES |
226,486 |
222,880 |
197,407 |
|
Trinity Biotech
plc |
Consolidated Statement
of Cash Flows |
|
|
|
|
|
(US$000's) |
Three Months |
Three Months |
Year |
Year |
|
Ended |
Ended |
Ended |
Ended |
|
Dec 31, |
Dec 31, |
Dec 31, |
Dec 31, |
|
2013 |
2012 |
2013 |
2012 |
|
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
|
|
|
|
|
Cash and cash equivalents at
beginning of period |
26,806 |
74,455 |
74,947 |
71,085 |
|
|
|
|
|
Operating cash flows before changes in
working capital |
3,877 |
5,973 |
19,764 |
22,285 |
Changes in working capital |
(915) |
(81) |
(8,657) |
(3,367) |
Cash generated from operations |
2,962 |
5,892 |
11,107 |
18,918 |
|
|
|
|
|
Net Interest and Income taxes
received/(paid) |
(74) |
83 |
599 |
1,138 |
|
|
|
|
|
Capital Expenditure & Financing
(net) |
(5,015) |
(4,236) |
(19,583) |
(12,920) |
|
|
|
|
|
Free cash flow |
(2,127) |
1,739 |
(7,877) |
7,136 |
|
|
|
|
|
Proceeds from sale of Coagulation product
line |
-- |
-- |
-- |
11,250 |
|
|
|
|
|
Cash paid to acquire Fiomi Diagnostics and
Phoenix Biotech |
-- |
-- |
-- |
(5,957) |
|
|
|
|
|
Cash paid to acquire Immco and Blood Bank
Screening Business |
-- |
-- |
(39,424) |
-- |
|
|
|
|
|
Payments for licence fees |
(2,362) |
-- |
(2,362) |
-- |
|
|
|
|
|
Net cash acquired on acquisition |
-- |
-- |
1,406 |
-- |
|
|
|
|
|
Dividend payment |
-- |
-- |
(4,373) |
(3,223) |
|
|
|
|
|
Repurchase of own company shares |
-- |
(1,247) |
-- |
(5,344) |
|
|
|
|
|
Cash and cash equivalents at end of
period |
22,317 |
74,947 |
22,317 |
74,947 |
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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