Abaxis Reports Financial Performance for the Third Quarter of Fiscal 2009
Posted on: Thursday, 29 January 2009, 15:00 CST
UNION CITY, Calif., Jan. 29 /PRNewswire-FirstCall/ -- Abaxis, Inc.
(Nasdaq: ABAX), a medical products company manufacturing point-of-care blood
analysis systems, today reported financial results for the fiscal quarter
ended December 31, 2008.
Highlights for the third quarter of fiscal 2009 include:
* Revenues of $27.0 million, up 5% over last year's comparable quarter.
* Medical market sales of $7.2 million, up 19% over last year's
comparable quarter.
* Medical reagent disc sales of 467,000 units, up 48% over last year's
comparable quarter.
* Record sales of Piccolo chemistry analyzers of 242 units, up 2% over
last year's comparable quarter.
* Sales of VetScan chemistry analyzers of 403 units, up 18% over last
year's comparable quarter.
* Total medical and veterinary reagent disc sales of $15.6 million
compared to $14.3 million in the same period last year, up 9% over last
year's comparable quarter.
* Operating income of $4.8 million, up 9% over last year's comparable
quarter.
* Net income of $3.4 million, up 5% over last year's comparable quarter.
* Diluted EPS: $0.15 versus $0.14 in the same period last year.
* Cash, cash equivalents and short-term investments as of December 31,
2008 of $74.6 million, compared to $55.8 million as of December 31,
2007.
Quarterly Results: For the fiscal quarter ended December 31, 2008, Abaxis
reported revenues of $27.0 million, as compared with revenues of $25.7 million
for the comparable period last year, an increase of 5 percent. Instrument,
reagent disc and hematology reagent revenues increased by an aggregate of $1.0
million, or 4 percent, for the quarter ended December 31, 2008, over the same
period last year. The company reported net income of $3.4 million, compared
to $3.2 million for the same period last year. The company's effective tax
rate in the quarter ended December 31, 2008 was 34 percent, compared to 35
percent for the same period last year. The company reported diluted net
income per share of $0.15 (calculated based on 22,264,000 shares) for the
third quarter of fiscal 2009, compared to $0.14 per share (calculated based on
22,359,000 shares) for the same period last year.
Nine Month Results: For the nine-month period ended December 31, 2008,
Abaxis reported revenues of $79.2 million, as compared with revenues of $73.8
million for the comparable period last year, an increase of 7 percent.
Instrument, reagent disc and hematology reagent revenues increased by an
aggregate of $5.5 million, or 8 percent, for the nine-month period ended
December 31, 2008, over the same period last year. The company reported net
income of $9.4 million, compared to $9.2 million for the same period last
year. The company's effective tax rate in the nine months ended December 31,
2008 was 36 percent, compared to 37 percent for the same period last year.
The company reported diluted net income per share of $0.42 (calculated based
on 22,325,000 shares) for the nine months ended December 31, 2008, compared to
$0.41 per share (calculated based on 22,208,000 shares) for the same period
last year.
Other Reported Financial Information: Reagent disc and hematology reagent
revenues for the third quarter of fiscal 2009 were $16.8 million, up 9 percent
over the $15.3 million reported in the same period last year. During the
quarter, the company sold a total of 1,300,000 units of medical and veterinary
reagent discs, an increase of 7 percent compared to a total of 1,212,000 units
of medical and veterinary reagent discs sold during the same period last year.
Medical sales in North America, excluding sales to the U.S. government, during
the third quarter of fiscal 2009 were $4.7 million, an increase of 10 percent
over last year's comparable quarter. Total sales in the medical market for
the third quarter of fiscal 2009 were $7.2 million, an increase of 19 percent
over last year's comparable quarter. Total sales in the veterinary market for
the third quarter of fiscal 2009 were $17.9 million, a decrease of 1 percent
over last year's comparable quarter. Additionally, the company sold $11.3
million of veterinary reagent discs during each of the third quarters of
fiscal 2009 and fiscal 2008.
The company ended the quarter with $74.6 million in cash, cash equivalents
and short-term investments. As of December 31, 2008, the company had a total
of $14.5 million in short-term investments, consisting entirely of
certificates of deposits. During the third quarter of fiscal 2009, $28.4
million of the company's auction rate securities were redeemed at 100 percent
of par value.
Clint Severson, chairman and chief executive officer of Abaxis, commented,
"Given the current economic conditions, we are pleased with the continued
growth in overall revenues and net income for the quarter. We remain focused
on improving operating efficiencies and aggressively managing operating
expenses. Gross margins improved to 56% for the quarter, an increase of 300
basis points, compared to last year's third quarter. Additionally, reagent
disc margins improved to 66%, an increase of 290 basis points, compared to
last year's third quarter. The company has a very strong balance sheet with a
total of $74.6 million in cash, cash equivalents and short-term investments
and no debt; and a solid recurring revenue stream, comprised of reagent discs
and hematology reagents, which represents 62% of sales for the third quarter.
Abaxis believes that it is well positioned for future growth."
Mr. Severson continued, "The quarter was highlighted by the continued
strength in our consumable business. Medical reagent disc unit sales
increased 48% compared to the third quarter of fiscal 2008. Medical sales
continued to grow during the quarter and accounted for 27% of total sales.
Also during the quarter we achieved another significant milestone, as we
received CLIA waived status from the United States Food and Drug
Administration on two additional medical panels -- the Renal Function and
MetLyte 8 -- bringing the total number of CLIA waived reagent disc panels in
our portfolio to 11."
Conference Call
Abaxis has scheduled a conference call to discuss its results at 4:15 p.m.
Eastern Time on January 29, 2009. Participants can dial (877) 356-5706 or
(706) 643-0580 to access the conference call, or can listen via a live
Internet web cast, which is available in the Investor Relations section of the
company's website at http://www.abaxis.com. A replay of the call is available
by visiting http://www.abaxis.com for the next 30 days or by calling (800)
642-1687 or (706) 645-9291, access code 82004441, through February 2, 2009.
This press release is also available prior to and after the call via Abaxis'
website or the Securities and Exchange Commission's website at
http://www.sec.gov.
About Abaxis
Abaxis develops, manufactures and markets portable blood analysis systems
for use in any veterinary or human patient-care setting to provide clinicians
with rapid blood constituent measurements. The system consists of a compact,
5.1 kilogram (11.2 pounds), portable analyzer and a series of single-use
plastic discs, called reagent discs that contain all the chemicals required to
perform a panel of up to 13 tests on veterinary patients and 14 tests on human
patients. The system can be operated with minimal training and performs
multiple routine tests on whole blood, serum or plasma samples. The system
provides test results in less than 12 minutes with the precision and accuracy
equivalent to a clinical laboratory analyzer.
Use of Non-GAAP Financial Measures
To supplement its financial statements presented in accordance with United
States generally accepted accounting principles (GAAP), Abaxis uses operating
income per share. This non-GAAP financial presentation is not a measurement
of performance under GAAP in the United States of America. Management uses
this measure in comparing Abaxis' operating results with historical
performance and believes it provides meaningful and comparable information to
management and investors to assist in their review of Abaxis' performance
relative to prior periods and its competitors.
This press release includes, and our conference call will include,
statements that constitute "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995 (the "Reform Act"),
including but not limited to statements related to Abaxis' financial resources
and potential for future growth. Abaxis claims the protection of the safe-
harbor for forward-looking statements contained in the Reform Act. These
forward-looking statements are often characterized by the terms "may,"
"believes," "projects," "expects," "anticipates," or words of similar import,
and do not reflect historical facts. Specific forward-looking statements
contained in this press release or in Abaxis' conference call may be affected
by risks and uncertainties, including, but not limited to, those related to
the market acceptance of the company's products and the continuing development
of its products, required United States Food and Drug Administration clearance
and other government approvals, risks associated with manufacturing and
distributing its products on a commercial scale free of defects, risks related
to the introduction of new instruments manufactured by third parties, risks
associated with entering the human diagnostic market on a larger scale, risks
related to the protection of the company's intellectual property or claims of
infringement of intellectual property asserted by third parties, risks related
to condition of the United States economy, risks involved in carrying of
inventory and other risks detailed under "Risk Factors" in Abaxis' Quarterly
Report on Form 10-Q for the fiscal quarter ended September 30, 2008 and
Abaxis' other periodic reports filed from time to time with the United States
Securities and Exchange Commission. Forward-looking statements speak only as
of the date the statements were made. Abaxis does not undertake and
specifically disclaims any obligation to update any forward-looking
statements.
Financial Tables on Following Pages
ABAXIS, INC.
Condensed Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three Months Ended Nine Months Ended
December 31, December 31,
2008 2007 2008 2007
Revenues $26,964 $25,690 $79,224 $73,813
Cost of revenues 11,859 12,081 35,274 33,331
Gross profit 15,105 13,609 43,950 40,482
Operating expenses:
Research and development 2,037 1,629 6,116 5,104
Sales and marketing 6,061 6,056 18,382 17,666
General and administrative 2,241 1,571 5,855 4,760
Total operating expenses 10,339 9,256 30,353 27,530
Income from operations 4,766 4,353 13,597 12,952
Interest and other income (expense),
net 352 552 1,140 1,580
Income before income taxes 5,118 4,905 14,737 14,532
Income tax provision 1,762 1,700 5,308 5,341
Net income $3,356 $3,205 $9,429 $9,191
Net income per share:
Basic net income per share $0.15 $0.15 $0.43 $0.43
Diluted net income per share $0.15 $0.14 $0.42 $0.41
Shares used in the calculation of net
income per share:
Weighted average common shares
outstanding - basic 21,879 21,561 21,798 21,441
Weighted average common shares
outstanding - diluted 22,264 22,359 22,325 22,208
ABAXIS, INC.
Condensed Consolidated Balance Sheets
(Unaudited and in thousands)
December 31, March 31,
2008 2008
Current assets:
Cash and cash equivalents $60,158 $17,219
Short-term investments 14,489 6,991
Trade receivables, net 21,557 20,873
Inventories, net 17,104 18,657
Prepaid expenses 1,241 427
Net deferred tax asset - current 3,481 2,426
Total current assets 118,030 66,593
Long-term investments - 35,463
Property and equipment, net 15,130 14,599
Intangible assets, net 319 375
Other assets 29 5
Net deferred tax asset - non-current 3,874 3,868
Total assets $137,382 $120,903
Current liabilities:
Accounts payable $5,920 $6,421
Accrued payroll and related expenses 2,822 4,277
Other accrued liabilities 1,472 1,369
Deferred revenue 922 807
Warranty reserve 1,637 1,219
Total current liabilities 12,773 14,093
Non-current liabilities:
Deferred rent 183 286
Deferred revenue 1,516 1,146
Warranty reserve 748 729
Total non-current liabilities 2,447 2,161
Shareholders' equity:
Common stock 115,700 109,031
Retained earnings (accumulated deficit) 6,462 (2,967)
Accumulated other comprehensive loss - (1,415)
Total shareholders' equity 122,162 104,649
Total liabilities and shareholders' equity $137,382 $120,903
Non-GAAP Operating Income Per Share
(In thousands, except per share data)
Three Months Ended Nine Months Ended
December 31, December 31,
2008 2007 2008 2007
Shares used in the calculation of
operating income per share (non-GAAP):
Weighted average common shares
outstanding - basic 21,879 21,561 21,798 21,441
Weighted average common shares
outstanding - diluted 22,264 22,359 22,325 22,208
Non-GAAP operating income per
share - basic $0.22 $0.20 $0.62 $0.60
Non-GAAP operating income per
share - diluted $0.21 $0.19 $0.61 $0.58
Revenues by Geographic Region
(In thousands)
Three Months Ended Nine Months Ended
December 31, December 31,
2008 2007 2008 2007
North America $22,852 $21,628 $65,629 $61,868
International 4,112 4,062 13,595 11,945
Total revenues $26,964 $25,690 $79,224 $73,813
Revenues by Customer Group
(In thousands)
Three Months Ended Nine Months Ended
December 31, December 31,
2008 2007 2008 2007
Medical Market $7,175 $6,005 $19,719 $16,455
Veterinary Market 17,907 18,073 54,465 52,498
Other 1,882 1,612 5,040 4,860
Total revenues $26,964 $25,690 $79,224 $73,813
SOURCE Abaxis, Inc.
Source: PR Newswire
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