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, 2014.
Quarter 2 Results
Total revenues for Q2, 2014 were $26.0m compared to $21.3m in
Q2, 2013, which represents an increase of 22%.
Point-of-Care revenues for Q2, 2014 were $4.6m and broadly in
line with the comparative quarter last year. Clinical
Laboratory revenues increased from $16.7m to $21.4m, which
represents an increase of 27.9% compared to Q2, 2013. This
growth was achieved through a combination of acquisition revenues
and higher diabetes revenues as partially offset by slightly lower
Lyme and Fitzgerald sales.
Revenues for Q2, 2014 by key product area were as follows:
|
|
|
|
|
2013 |
2014 |
|
|
Quarter 2 |
Quarter 2 |
Increase |
|
US$'000 |
US$'000 |
% |
Point-of-Care |
4,586 |
4,615 |
0.6% |
Clinical Laboratory |
16,726 |
21,390 |
27.9% |
Total |
21,312 |
26,005 |
22.0% |
Gross profit for Q2, 2014 amounted to $12.5m representing a
gross margin of 48.1%, which is slightly lower than the 49.0%
achieved in Q2, 2013. This decrease is primarily attributable to
the impact of lower margins on Premier instrument sales, but also
due to additional costs associated with running two manufacturing
facilities in the UK. Production of blood banking products at
these facilities ceased at the end of June and was transferred to
other company facilities in the USA and Ireland.
Research and Development expenses have increased from $0.9m to
$1.2m when compared to the equivalent quarter last year. Meanwhile,
Selling, General and Administrative (SG&A) expenses have
increased over the same period from $5.5m to $6.4m. In both cases,
the increase was primarily due to the impact of the Immco and blood
bank screening acquisitions, both of which were undertaken in the
second half of 2013.
Operating profit has increased from $3.7m to $4.6m for the
quarter, which equates to an increase of 25% and represents an
operating margin of 17.7%.
Financial income was broadly offset by financial expenses
resulting in a negligible net expense for the quarter. This
compares to net financial income of approximately $0.4m earned in
Q2, 2013. This is due to lower funds being placed on deposit
following the utilisation of funds for the Immco and blood banking
acquisitions and lower prevailing deposit interest rates.
The tax charge for Q2, 2014 was $0.3m which equates to an
effective tax rate of approximately 6%.
Profit before tax increased from $4.1m to over $4.6m which
represents an increase of approximately 12%. Meanwhile, profit
after tax increased from $3.8m to $4.3m, an increase of 13%.
EPS for the quarter was 19.0 cents which compares to 17.7
cents for the equivalent period last year.
Earnings before interest, tax, depreciation, amortisation and
share option expense for the quarter was $6.0m. This compares to
$5.1m for Q2, 2013.
Recent Developments
Cardiac Update
In quarter 1, 2014 the company obtained CE marking for the
Meritas Troponin I test, our new high sensitivity Troponin
product. The product is currently undergoing clinical
evaluation in all major European markets in advance of commercial
rollout. Meanwhile, for the purpose of FDA approval, the
Meritas Troponin I test is undergoing clinical evaluation at
multiple trial sites across the USA. To date, six US trial
sites have been enrolling patients for the Acute Coronary Syndrome
(ACS) study and over the coming weeks we intend to increase the
number of trial sites to 10. We are currently recruiting ACS
patients at a rate of approximately 40 per week. With the
additional trial sites coming on line, we envisage that enrolment
rates will reach 80 to 100 patients per week. At this level of
recruitment, sufficient ACS data is expected to be available by
mid-Q4 2014, with clinical adjudication to follow immediately
thereafter and submission to the FDA targeted for the end of
2014. Meanwhile, enrolment for our Normals (99th percentile)
study is progressing according to plan at three trial sites and is
expected to be completed well in advance of the ACS trial.
Furthermore, Dr. Fred Apple (Medical Director at Hennepin County
Medical Center, Minneapolis and Key Opinion Leader in cardiology)
presented the results of an independent clinical evaluation he has
carried out on the Meritas Troponin I product at this week's AACC
annual meeting in Chicago. His results indicate that the
Meritas product has a diagnostic accuracy far in advance of any of
the existing point-of-care Troponin tests and indeed in many
cases is as good as, if not better than, some of the central
laboratory Troponin products currently available on the US market.
Dr Apple concludes that this study validates the Meritas Troponin I
test as an appropriate tool for both ruling in and ruling out
myocardial infarction in the emergency room setting.
Moreover, this study was constructed in a fashion that
mirrors the ACS trial required by the FDA. The results of Dr.
Apple's independent trial, in addition to the results of the trials
carried out for CE marking, provide us with a high degree of
confidence that the Meritas Troponin product has the necessary
performance characteristics to meet and indeed exceed the FDA's new
stringent performance specifications for Troponin testing.
During the quarter, significant progress has been made in
completing the development of our Meritas BNP product for detection
of heart failure. The clinical trials necessary to obtain CE
marking are virtually complete and we expect to submit for CE
clearance during the month of August. This will be immediately
followed by the commencement of US clinical trials, with FDA
submission expected before the end of 2014. Meanwhile,
development of our Meritas D-dimer product, a test for Pulmonary
Embolism and DVT (deep vein thrombosis) is progressing very well
and according to schedule.
Premier Update
Sales of our diabetes instrument, Premier, continue to perform
strongly. During the quarter, 106 instruments were sold or placed
with customers. This compares with 80 instruments for the
equivalent period last year. This brings the total sales or
placements of instruments for the first half of 2014 to
207. On this basis, we are in line to achieve our target of
460 for the year as a whole.
During the quarter, we also formally launched our new Premier
Resolution instrument. This version of the instrument has been
specifically designed for the detection and identification of
haemoglobin variants as opposed to A1c (diabetes) testing which is
currently undertaken by the existing Premier instrument. Prior to
this Trinity had only limited presence in the variant market, being
largely concentrated in the high throughput end of the US market
with the Ultra instrument. Going forward Premier Resolution,
which will act as a companion instrument for the Premier, will
provide greater access to this segment of the market. Following its
launch the first instruments have already been placed in the United
Kingdom.
Immco Update
The Immco acquisition has been performing well and has now been
fully integrated into the Trinity group. We are particularly
pleased with the opportunity that Sjö™ , Immco's test for the early
detection for Sjögren's syndrome, represents. Towards the end of
the quarter, in conjunction with our partner, Nicox, this test was
rolled out nationally in the USA. Prior to this, it has only
been available in a number of selected US markets – where initial
indicators had demonstrated that the product was well received and
for which there was strong demand. Since then, we have
extended Nicox's rights to this product to cover all healthcare
practitioners in North America – previously it had been limited to
the ophthalmic segment of the market.
Sjögren's syndrome is a very prevalent though widely
under-diagnosed debilitating condition of which dry eye is one of
the primary symptoms. Immco's Sjö™ test is the only approved
test for Sjögren's syndrome in the USA.
Dividend
Shareholder approval for payment of a dividend of 22 US cents
per ADR, was granted at the company's AGM, which was held on 6
June, 2014. This represents an increase of 10% compared with
20 US cents per ADR paid in 2013. Payment of the dividend was
made in July 2014.
Comments
Commenting on the results, Kevin Tansley, Chief Financial
Officer, said "This quarter we achieved impressive profitability
growth with operating profit growing by 25% and profit after tax
rising by almost 13%. This was achieved notwithstanding
increased marketing costs for our new cardiac product range and
increased placements of Premier instruments which tend to have
lower margins. In addition, this quarter's results were impacted by
running duplicate facilities in the United Kingdom for our blood
bank screening business. Production at these facilities has
now ceased and they will be fully vacated by the end of this month
resulting in cost savings from quarter 3 onwards."
Ronan O'Caoimh, CEO, stated "The clinical trials for our new
Troponin I test on the Meritas platform are now well
underway. To date these trials have been progressing more
slowly than we would have wanted. This has been solely attributable
to slower than expected recruitment of patients for the trials due
to the nature of the testing protocol that we are required to
adhere to. In order to avoid any delay in submitting the
results to the FDA, we have increased the number of trial sites
from the six existing sites to 10 sites in total. Recruitment at
the new sites will commence imminently. Meanwhile, we were
very pleased with the performance of the test in Dr. Apple's
Troponin trial results, which were published yesterday at the AACC
annual meeting in Chicago. These results, we believe,
demonstrated the unparalleled specificity and sensitivity of the
product in the point-of-care environment, thus reinforcing its
capability as both a rule in and rule out test.
Meanwhile, our BNP test on the same platform is nearing the
completion of its CE marking trials. The results of these
trials have been showing excellent performance and consequently we
expect to announce European regulatory approval in the coming
weeks. Once this has been achieved we will immediately
commence our FDA trials. By their nature these trials will be
more straight forward than the Troponin trials and thus we expect
to be in a position to submit this product to the FDA for approval
by the end of 2014.
I am also pleased to report that our Immco product line
continues to perform very well. In particular, we believe the
company's Sjö™ test for the early detection of Sjögren's syndrome
represents a significant growth opportunity for the
company. The product has already been well received in a
number of test markets in the USA. Consequently, in
conjunction with our partner, Nicox, it has now been rolled out
nationally in the USA where we believe it will gain significant
traction."
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 |
Six Months |
Six Months |
|
Ended |
Ended |
Ended |
Ended |
|
June 30, |
June 30, |
June 30, |
June 30, |
|
2014 |
2013 |
2014 |
2013 |
|
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
|
|
|
|
|
Revenues |
26,005 |
21,312 |
51,030 |
41,640 |
|
|
|
|
|
Cost of sales |
(13,496) |
(10,865) |
(26,360) |
(21,026) |
|
|
|
|
|
Gross profit |
12,509 |
10,447 |
24,670 |
20,614 |
Gross profit % |
48.1% |
49.0% |
48.3% |
49.5% |
|
|
|
|
|
Other operating income |
98 |
85 |
248 |
195 |
|
|
|
|
|
Research & development expenses |
(1,155) |
(924) |
(2,192) |
(1,779) |
Selling, general and administrative
expenses |
(6,417) |
(5,502) |
(12,730) |
(10,535) |
Indirect share based payments |
(442) |
(440) |
(897) |
(938) |
|
|
|
|
|
Operating profit |
4,593 |
3,666 |
9,099 |
7,557 |
|
|
|
|
|
Financial income |
42 |
466 |
84 |
943 |
Financial expenses |
(44) |
(26) |
(64) |
(52) |
Net financing income /
(expense) |
(2) |
440 |
20 |
891 |
|
|
|
|
|
Profit before tax |
4,591 |
4,106 |
9,119 |
8,448 |
|
|
|
|
|
Income tax expense |
(276) |
(278) |
(391) |
(452) |
|
|
|
|
|
Profit for the
period |
4,315 |
3,828 |
8,728 |
7,996 |
|
|
|
|
|
Earnings per ADR (US cents) |
19.0 |
17.7 |
38.6 |
36.8 |
|
|
|
|
|
Diluted earnings per ADR (US cents) |
18.2 |
16.9 |
36.8 |
34.9 |
|
|
|
|
|
|
|
|
|
|
Weighted average no. of ADRs used in
computing basic earnings per ADR |
22,703,261 |
21,665,259 |
22,584,889 |
21,732,983 |
Weighted average no. of ADRs used in
computing diluted earnings per ADR |
23,686,336 |
22,711,752 |
23,720,056 |
22,935,565 |
|
|
|
|
|
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, |
March 31, |
Dec 31, |
|
2014 |
2014 |
2013 |
|
US$ '000 |
US$ '000 |
US$ '000 |
|
(unaudited) |
(unaudited) |
(audited) |
ASSETS |
|
|
|
Non-current assets |
|
|
|
Property, plant and equipment |
14,784 |
13,841 |
12,991 |
Goodwill and intangible assets |
137,848 |
133,881 |
128,547 |
Deferred tax assets |
9,082 |
7,570 |
7,044 |
Other assets |
1,222 |
1,131 |
1,162 |
Total non-current
assets |
162,936 |
156,423 |
149,744 |
|
|
|
|
Current assets |
|
|
|
Inventories |
33,109 |
30,864 |
29,670 |
Trade and other receivables |
27,163 |
24,130 |
24,268 |
Income tax receivable |
88 |
493 |
487 |
Cash and cash equivalents |
15,153 |
17,008 |
22,317 |
Total current assets |
75,513 |
72,495 |
76,742 |
|
|
|
|
TOTAL ASSETS |
238,449 |
228,918 |
226,486 |
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
Equity attributable to the equity
holders of the parent |
|
|
|
Share capital |
1,202 |
1,187 |
1,170 |
Share premium |
12,097 |
9,731 |
8,842 |
Accumulated surplus |
179,137 |
174,023 |
168,670 |
Other reserves |
3,672 |
4,073 |
4,329 |
Total equity |
196,108 |
189,014 |
183,011 |
|
|
|
|
Current liabilities |
|
|
|
Income tax payable |
1,036 |
998 |
770 |
Trade and other payables |
16,106 |
15,679 |
20,131 |
Provisions |
75 |
75 |
75 |
Total current
liabilities |
17,217 |
16,752 |
20,976 |
|
|
|
|
Non-current liabilities |
|
|
|
Other payables |
4,665 |
4,634 |
4,596 |
Deferred tax liabilities |
20,459 |
18,518 |
17,903 |
Total non-current
liabilities |
25,124 |
23,152 |
22,499 |
|
|
|
|
TOTAL LIABILITIES |
42,341 |
39,904 |
43,475 |
|
|
|
|
TOTAL EQUITY AND
LIABILITIES |
238,449 |
228,918 |
226,486 |
|
|
|
|
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 Months |
Three Months |
Six Months |
Six Months |
|
Ended |
Ended |
Ended |
Ended |
|
June 30, |
June 30, |
June 30, |
June 30, |
|
2014 |
2013 |
2014 |
2013 |
|
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
|
|
|
|
|
Cash and cash equivalents at
beginning of period |
17,008 |
73,095 |
22,317 |
74,947 |
|
|
|
|
|
Operating cash flows before changes in
working capital |
5,919 |
4,887 |
10,911 |
10,064 |
Changes in working capital |
(4,309) |
(2,793) |
(9,571) |
(5,344) |
Cash generated from operations |
1,610 |
2,094 |
1,340 |
4,720 |
|
|
|
|
|
Net Interest and Income taxes received |
611 |
367 |
614 |
799 |
|
|
|
|
|
Capital Expenditure & Financing
(net) |
(4,076) |
(5,019) |
(9,118) |
(9,929) |
|
|
|
|
|
Free cash flow |
(1,855) |
(2,558) |
(7,164) |
(4,410) |
|
|
|
|
|
Dividend payment |
-- |
(4,373) |
-- |
(4,373) |
|
|
|
|
|
Cash and cash equivalents at end of
period |
15,153 |
66,164 |
15,153 |
66,164 |
|
|
|
|
|
|
|
|
|
|
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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