PerkinElmer Reports Slight Revenue Gains for Q1

PerkinElmer reported after the close of the market on Thursday that total revenues for the first quarter of 2019 inched up a fraction of 1 percent year over year while revenues from its Diagnostics division grew 5 percent.
 
For the three months ended March 31, the Waltham, Massachusetts-based company posted revenues of $648.7 million, up from $644.0 million in Q1 2018. It beat analysts' average estimate of $645.1 million.
 
Diagnostics revenues grew to $259.9 million from $247.4 million in the year-ago period, but Discovery & Analytical Solutions revenues dropped 2 percent to $388.8 million from $396.5 million.
 
Organic revenue growth companywide was 5 percent year over year, PerkinElmer Chairman and CEO Robert Friel said on a conference call to discuss the financial results. In Diagnostics, he added, the year-over-year increase was fueled by the prevalence of infectious diseases, as well as autoimmune diseases, particularly in emerging markets.
 
"Increasing demand for early diagnosis and the rising demand for new technologies also is fueling growth across all three of our segments of reproductive health, immunodiagnostics, and genomics," Friel said.
 
PerkinElmer CFO Jamey Mock said on the call that reproductive health revenues were up organically in the high single digits year over year driven by the genomic testing business, where revenues remain on track to double for the year. Meanwhile, immunodiagnostics grew in the low double digits led by double-digit growth in both the Euroimmun and Tulip Diagnostics businesses, and applied genomics products grew in the high single digits.
 
Regarding its Vanadis NIPT system, PerkinElmer remains on track to have 30 total installations by the end of the year. PerkinElmer President and COO Prahlad Singh added that at the end of Q1 there were 13 installations. He noted that a study, which will provide data on Vanadis, has been submitted for publication in an unnamed journal, while discussions around the company's strategy for payor reimbursements have just started.
 
For Q1, PerkinElmer spent $48.0 million on R&D, up 4 percent from $46.0 million a year ago. Its SG&A costs were trimmed less than 1 percent to $198.9 million from $199.7 million.
 
Its net income for the recently completed quarter was $35.4 million, or $.32 per share, compared to net income of $26.0 million , or $.23 per share, in Q1 2018. Adjusted EPS was $.69 and beat the consensus Wall Street estimate of $.66.
 
PerkinElmer also announced today the acquisition of Cisbio Bioassays, a custom assay service provider based in Codolet, France for an undisclosed amount. Cisbio develops and manufactures kits and reagents for the life sciences and diagnostics spaces.
 
In 2018, Cisbio recorded about $50 million in revenues, Friel said, with about 25 percent of its revenues focused on in vitro diagnostics. The company brings strong technical capabilities in intellectual property in molecular and cellular biology and assay development, according to Friel.
 
The deal, PerkinElmer said, expands its offerings for life sciences researchers, and it noted that Cisbio's HTRF screening technology can be integrated into PerkinElmer's customers' upstream workflows, including target identification and characterization, as well as downstream applications, such as lead optimization and validation.
 
The acquisition also expands PerkinElmer's cell-based assay R&D capability, and the firm expects to leverage Cisbio's customer base in key growth geographies including the Americas, Europe, and China to expand its market reach for reagents.
 
PerkinElmer's board also declared a regular quarterly dividend of $.07 per share, payable on Aug. 9 to shareholders of record at the close of business on July 19.
 
For full-year 2019, the company raised its revenue guidance to a new figure of $2.93 billion, which includes a contribution of $35 million from the Cisbio acquisition. It had issued a prior guidance of $2.89 billion in late January.
 
PerkinElmer forecast EPS from continuing operations of between $2.85 and $2.90, while adjusted EPS is expected to be in the range of $4.02 to $4.07. It previously forecast EPS in the range of $2.93 to $2.98, and adjusted EPS of between $4.00 and $4.05.