OraSure Technologies, Inc. (NASDAQ: OSUR), a leader in
point-of-care diagnostic tests, specimen collection devices, and
microbiome laboratory and analytical services, today announced its
financial results for the three months ended March 31, 2021.
“OraSure had another strong quarter, as the
Company delivered double-digit year-over-year revenue growth for
the third quarter in a row. Our sample collection devices for
COVID-19 molecular testing continue to make a significant
contribution to our revenues. Moreover, we have submitted our
COVID-19 rapid antigen test to the US Food and Drug Administration
for Emergency Use Authorization, and look forward to bringing a
prescription home test and a professional test for point of care
use to market,” said Stephen Tang, Ph.D., President and CEO of
OraSure Technologies.
Dr. Tang continued, “As coronavirus variants
continue to spread, we believe convenient, safe and accurate
COVID-19 testing will continue to play a key role in identifying
those who are infected and helping to safely reopen workplaces,
schools, and other places where people gather. We are confident in
the market potential for our COVID products, as well as the
resilience of our other business segments as demonstrated by the
strong first quarter performance of our commercial genomics,
microbiome, and domestic HIV testing business. Given the overall
strong financial performance of our business, the EUA applications
pending before the FDA and our solid financial foundation, we are
confident that OraSure is well positioned for continued
success.”
Financial Highlights
- Net revenues for the first quarter
of 2021 were $58.6 million, an 85% increase from the first
quarter of 2020. Net product and services revenues were $56.6
million, an 83% increase from the first quarter of 2020.
- Total product and service revenues
for the Company’s molecular business unit were $43.2
million during the first quarter of 2021, an increase of 227%
from the first quarter of 2020. This increase included $27.4
million in sales of sample collection devices for COVID-19
molecular testing.
- The Company’s genomics business
grew 32% year over year, driven by demand in the Disease Risk
Management, Companion Animal and Academic Research markets. The
Microbiome kits business grew 32% driven by sales to commercial
accounts.
- Domestic HIV revenues of $5.3
million grew 26% year over year, driven by HIV OTC test
sales.
- International HIV and HCV revenues
declined 42% over the prior year, due to several large distributor
orders which occurred in Q1 2020 and variations in timing as
compared to 2021 ordering.
- Net income for the first quarter of
2021 was $3.8 million, or $0.05 per share on a
fully-diluted basis, compared to a net loss of $7.3 million,
or $0.12 per share on a fully-diluted basis, for the
first quarter of 2020.
- Cash and investments
totaled $240.5 million at March 31, 2021.
COVID-19 Update
Antigen:
- OraSure has submitted an
Emergency Use Authorization (EUA) application to the U.S. Food and
Drug Administration (FDA) for its COVID-19 rapid antigen test for
both Prescription Home Use, and Professional Use in point of care
(POC) CLIA-waived settings.
- These lateral flow, rapid
diagnostic tests are designed to detect active COVID-19 infection
with a simple, easy-to-use workflow, using samples self-collected
from the lower nostrils. After users swab their lower nostrils, the
test stick is swirled in a pre-measured buffer solution. No
instrumentation, batteries, smart phone or laboratory analysis is
needed to read the result, which appears on the test stick a short
time later.
- Subject to receipt of EUA, the
Company intends to market the COVID-19 Prescription Home Test and a
Professional Test for use in POC CLIA-waived settings.
- With a simple design and
straightforward workflow, the Company believes its tests are well
suited for use by individuals at home, as well as by health care
providers, employers, pharmacies, universities, and for deployment
into underserved communities when prescribed by a healthcare
provider. The simple, user-friendly nature of the test can make
testing more accessible and convenient in areas where medical
personnel, infrastructure and supplies may be lacking.
- The Company has started
manufacturing the COVID-19 antigen tests as it awaits EUA.
- The Company also intends to pursue
an over-the-counter (OTC) indication for the rapid antigen
test.
Molecular/PCR:
- Sales of sample collection
devices for molecular/PCR COVID-19 testing in the first quarter
continued to grow sequentially.
- Use of DNA Genotek molecular sample
collection kits continued to grow in the first quarter of 2021,
with demand driven by both high-volume repeat orders from existing
customers and demand from new customers engaged in back-to-work and
back-to-school testing programs around the world.
- The ORAcollect®·RNA saliva
collection device has been used in more than two million COVID-19
tests developed by DNA Genotek customer Quadrant Biosciences in
partnership with SUNY Upstate Medical University, up from the one
million administered tests SUNY announced in February 2021. This
test has been used extensively by State University of New York
campuses since the start of the fall 2020 semester.
Antibody:
- OraSure has collected
all the data necessary to resubmit the two requested EUA
applications for its oral fluid antibody test. At
the FDA’s request, the Company plans to submit separate EUAs for
the ELISA microplate assay and the OraSure Oral Antibody Collection
Device.
- To date, no oral fluid antibody
tests have received EUA; OraSure’s test has the potential to be the
first.
- With this test, individuals would
use the OraSure Oral Antibody Collection Device to self-collect an
oral fluid sample under the observation of a healthcare
professional. The sample would then be placed into the buffer vial
for storage and transport, and then later dispensed onto the
OraSure Sars-CoV-2 ELISA microplate for testing in a
laboratory.
- This lab-based antibody test can
aid in identifying individuals with an adaptive immune response to
SARS-CoV-2, indicating prior infection.
- OraSure continues to sell its
antibody test for research use only.
Manufacturing:
- OraSure’s initiative to
increase manufacturing capacity to meet demand for COVID-19 sample
collection kits and tests continues.
- The Company is expanding installed
manufacturing capacity for the rapid antigen test to 70 million
tests per year in the third quarter of 2021 (including tests for
HIV, HCV and Ebola).
- OraSure plans additional expansion
of 50 million rapid antigen tests, bringing installed capacity to
120 million tests per year (including tests for HIV, HCV and Ebola)
by the second quarter of 2022. The Company expects this additional
capacity to support sales outside of the U.S.
- Capacity expansion for the
Company’s molecular sample collection kits has increased beyond its
original projections. The Company is expanding installed capacity
of its molecular sample collection devices to a rate of
approximately 80 million units annually in the second quarter of
2021, ahead of the 75 million annual units previously communicated,
and further to 105 million units annually by the end of 2021,
including non-COVID kits.
- Installation of new lines for the
oral-fluid antibody test will bring total capacity to 20 million
units per year by the end of the year, including existing
products.
Financial Results for
the Three Months Ended March 31, 2021
Net revenues for the first quarter of 2021 of
$58.6 million increased 85% from the comparable period of 2020,
primarily as a result of strong sales of molecular sample
collection kits for COVID-19 testing, higher genomics product sales
and increased sales by the Company’s domestic HIV testing business,
partially offset by declines in revenues of our international HIV
products due to order timing and risk assessment products due to
the impact of COVID-19 on the overall risk assessment testing
market in the US.
Gross profit percentage was 65% for the three
months ended March 31, 2021 compared to 51% for the three
months ended March 31, 2020. Gross profit in the current quarter
benefited from an improved product mix associated with higher gross
profit percentage product sales.
For the three months ended March 31, 2021,
operating expenses were $27.9 million, an increase
of $3.7 million from the $24.2 million reported
for the three months ended March 31, 2020, largely due to
increased investment in the development and sale of the Company’s
COVID products. Operating expenses were also impacted by a benefit
of $806,000 representing the change in the estimated fair value of
acquisition-related contingent consideration compared to an expense
of $1.1 million recorded the same period of 2020.
The Company generated operating income
of $10.4 million in the first quarter of 2021 compared to
an operating loss of $8.1 million in the first quarter of
2020.
During the first quarters of 2021 and 2020, the
Company recorded income tax expense of $6.5 million and
$712,000, respectively.
Second Quarter 2021
Guidance
The Company expects second quarter 2021 net
revenues to range from $55 million to $60 million.
Financial Data (Unaudited)
|
|
|
Three Months Ended |
|
March 31, |
|
2021 |
|
2020 |
Results of Operations |
|
|
|
Net revenues |
$ |
58,582 |
|
|
$ |
31,596 |
|
Cost of
products and services sold |
|
20,256 |
|
|
|
15,465 |
|
Gross profit |
|
38,326 |
|
|
|
16,131 |
|
Operating
expenses: |
|
|
|
Research and development |
|
8,992 |
|
|
|
5,644 |
|
Sales and marketing |
|
9,530 |
|
|
|
7,369 |
|
General and administrative |
|
10,188 |
|
|
|
10,054 |
|
Change in fair value of acquisition-related contingent
consideration |
|
(806 |
) |
|
|
1,110 |
|
Total operating expenses |
|
27,904 |
|
|
|
24,177 |
|
Operating income (loss) |
|
10,422 |
|
|
|
(8,046 |
) |
Other income
(expense) |
|
(119 |
) |
|
|
1,430 |
|
Income
(loss) before income taxes |
|
10,303 |
|
|
|
(6,616 |
) |
Income tax
expense |
|
6,529 |
|
|
|
712 |
|
Net income
(loss) |
$ |
3,774 |
|
|
$ |
(7,328 |
) |
Earnings
(loss) per share: |
|
|
|
Basic |
$ |
0.05 |
|
|
$ |
(0.12 |
) |
Diluted |
$ |
0.05 |
|
|
$ |
(0.12 |
) |
|
|
|
|
Weighted
average shares: |
|
|
|
Basic |
|
71,878 |
|
|
|
61,927 |
|
Diluted |
|
72,766 |
|
|
|
61,927 |
|
|
Three Months Ended March 31, |
|
|
Dollars |
|
|
|
|
Percentage of Total Net Revenues |
|
|
2021 |
|
2020 |
|
% Change |
|
|
2021 |
|
|
2020 |
|
Market |
|
|
|
|
|
|
|
|
|
|
|
|
Infectious disease testing |
$ |
11,371 |
|
$ |
14,664 |
|
(22 |
) |
% |
|
20 |
% |
|
46 |
% |
Risk
assessment testing |
|
1,962 |
|
|
3,000 |
|
(35 |
) |
|
|
3 |
|
|
9 |
|
Molecular
solutions |
|
43,246 |
|
|
13,222 |
|
227 |
|
|
|
74 |
|
|
43 |
|
Net product and service revenues |
|
56,579 |
|
|
30,886 |
|
83 |
|
|
|
97 |
|
|
98 |
|
Other |
|
2,003 |
|
|
710 |
|
182 |
|
|
|
3 |
|
|
2 |
|
Net revenues |
$ |
58,582 |
|
$ |
31,596 |
|
85 |
|
% |
|
100 |
% |
|
100 |
% |
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
2020 |
|
% Change |
|
Infectious Disease Testing Revenues |
|
|
|
|
|
|
Domestic HIV |
$ |
5,293 |
|
$ |
4,216 |
|
26 |
|
% |
International HIV |
|
3,486 |
|
|
6,949 |
|
(50 |
) |
|
Net HIV revenues |
|
8,779 |
|
|
11,165 |
|
(21 |
) |
|
Domestic
HCV |
|
1,182 |
|
|
1,494 |
|
(21 |
) |
|
International HCV |
|
1,184 |
|
|
1,097 |
|
8 |
|
|
Net HCV revenues |
|
2,366 |
|
|
2,591 |
|
(9 |
) |
|
Other
product revenues |
|
226 |
|
|
908 |
|
(75 |
) |
|
Net product revenues |
$ |
11,371 |
|
$ |
14,664 |
|
(22 |
) |
% |
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
2020 |
|
% Change |
|
Molecular Solutions Revenues |
|
|
|
|
|
|
Genomics |
$ |
11,064 |
|
|
$ |
8,393 |
|
32 |
|
% |
Microbiome |
|
2,088 |
|
|
|
1,577 |
|
32 |
|
|
COVID-19 |
|
27,389 |
|
|
|
394 |
|
N/A |
|
|
Laboratory
services |
|
2,497 |
|
|
|
2,415 |
|
3 |
|
|
Other
product and service revenues |
|
208 |
|
|
|
443 |
|
(53 |
) |
|
Net product and service revenues |
|
43,246 |
|
|
|
13,222 |
|
227 |
|
|
Other |
|
790 |
|
|
|
582 |
|
36 |
|
|
Net revenues |
$ |
44,036 |
|
|
$ |
13,804 |
|
219 |
|
% |
Condensed Consolidated Balance Sheets
(Unaudited) |
|
|
|
|
|
March 31, 2021 |
|
December 31, 2020 |
Assets |
|
|
|
Cash and cash equivalents |
$ |
177,676 |
|
$ |
160,802 |
Short-term
investments |
|
29,080 |
|
|
48,599 |
Accounts
receivable, net |
|
36,391 |
|
|
38,835 |
Inventories |
|
40,348 |
|
|
31,863 |
Other
current assets |
|
8,913 |
|
|
8,794 |
Property,
plant and equipment, net |
|
64,943 |
|
|
51,860 |
Intangible
assets, net |
|
16,945 |
|
|
17,904 |
Goodwill |
|
40,493 |
|
|
40,351 |
Long-term
investments |
|
33,706 |
|
|
47,718 |
Other
non-current assets |
|
7,999 |
|
|
7,746 |
Total assets |
$ |
456,494 |
|
$ |
454,472 |
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
Accounts
payable |
$ |
20,731 |
|
$ |
17,407 |
Deferred
revenue |
|
4,580 |
|
|
4,811 |
Contingent
consideration obligation |
|
365 |
|
|
402 |
Other
current liabilities |
|
18,967 |
|
|
23,869 |
Non-current
contingent consideration obligation |
|
874 |
|
|
2,049 |
Other
non-current liabilities |
|
7,434 |
|
|
7,363 |
Stockholders' equity |
|
403,543 |
|
|
398,571 |
Total liabilities and stockholders' equity |
$ |
456,494 |
|
$ |
454,472 |
Additional Financial Data (Unaudited) |
Three Months Ended |
|
March 31, |
|
2021 |
|
2020 |
Capital expenditures |
$ |
11,061 |
|
|
$ |
2,595 |
Depreciation
and amortization |
$ |
2,489 |
|
|
$ |
2,165 |
Stock-based
compensation |
$ |
1,464 |
|
|
$ |
1,376 |
Cash
provided by (used in) operating activities |
$ |
(4,393 |
) |
|
$ |
2,499 |
Conference Call
The Company will host a conference call and
audio webcast for analysts and investors to discuss the Company’s
first quarter 2021 quarter results and certain business
developments, beginning today at 5:00 p.m. Eastern
Time (2:00 p.m. Pacific Time). On the call will be
Dr. Stephen S. Tang, President and Chief Executive
Officer, and Roberto Cuca, Chief Financial Officer. The call
will include prepared remarks by management and a question and
answer session.
In order to listen to the conference call,
please dial 844-831-3030 (Domestic) or 315-625-6887 (International)
and reference Conference ID # 1349536 or go to OraSure
Technologies’ web site, www.orasure.com, and click on the
Investor Relations page. Please click on the webcast link and
follow the prompts for registration and access 10 minutes prior to
the call. A replay of the call will be archived on OraSure
Technologies’ web site shortly after the call has ended and will be
available for 14 days. A replay of the call can also be accessed
until midnight, May 19, 2021, by dialing 855-859-2056
(Domestic) or 404-537-3406 (International) and entering the
Conference ID # 1349536.
It is recommended to dial-in at most 15 to 20
minutes prior to the call start to reduce waiting times. If a
participant will be listen-only, they are encouraged to listen via
the webcast on OraSure’s Investor Relations page.
About OraSure
TechnologiesOraSure Technologies empowers the global
community to improve health and wellness by providing access to
accurate, essential information. OraSure, together with its
wholly-owned subsidiaries, DNA Genotek, Diversigen, and Novosanis,
provides its customers with end-to-end solutions that encompass
tools, services and diagnostics. The OraSure family of companies is
a leader in the development, manufacture, and distribution of rapid
diagnostic tests, sample collection and stabilization devices, and
molecular services solutions designed to discover and detect
critical medical conditions. OraSure’s portfolio of products is
sold globally to clinical laboratories, hospitals, physician’s
offices, clinics, public health and community-based organizations,
research institutions, government agencies, pharma, commercial
entities and direct to consumers. For more information on OraSure
Technologies, please visit www.orasure.com.
Important InformationThis press
release contains certain forward-looking statements, including with
respect to expected revenues, products, product development
activities, regulatory submissions and authorizations and other
matters. Forward-looking statements are not guarantees of future
performance or results. Known and unknown factors that could cause
actual performance or results to be materially different from those
expressed or implied in these statements include, but are not
limited to: ability to successfully manage and integrate
acquisitions of other companies in a manner that complements or
leverages our existing business, or otherwise expands or enhances
our portfolio of products and our end-to-end service offerings, and
the diversion of management’s attention from our ongoing business
and regular business responsibilities to effect such integration;
the expected economic benefits of acquisitions (and increased
returns for our stockholders), including that the anticipated
synergies, revenue enhancement strategies and other benefits from
the acquisitions may not be fully realized or may take longer to
realize than expected and our actual integration costs may exceed
our estimates; impact of increased or different risks arising from
the acquisition of companies located in foreign countries; ability
to market and sell products, whether through our internal, direct
sales force or third parties; impact of significant customer
concentration in the genomics business; failure of distributors or
other customers to meet purchase forecasts, historic purchase
levels or minimum purchase requirements for our products; ability
to manufacture products in accordance with applicable
specifications, performance standards and quality requirements;
ability to obtain, and timing and cost of obtaining, necessary
regulatory approvals for new products or new indications or
applications for existing products; ability to comply with
applicable regulatory requirements; ability to effectively resolve
warning letters, audit observations and other findings or comments
from the U.S. Food and Drug Administration (“FDA”) or other
regulators; the impact of the novel coronavirus (“COVID-19”)
pandemic on our business and our ability to successfully develop
new products, validate the expanded use of existing collector
products, receive necessary regulatory approvals and authorizations
and commercialize such products for COVID-19 testing; changes in
relationships, including disputes or disagreements, with strategic
partners or other parties and reliance on strategic partners for
the performance of critical activities under collaborative
arrangements; ability to meet increased demand for the Company’s
products; impact of replacing distributors; inventory levels at
distributors and other customers; ability of the Company to achieve
its financial and strategic objectives and continue to increase its
revenues, including the ability to expand international sales;
ability to identify, complete, integrate and realize the full
benefits of future acquisitions; impact of competitors, competing
products and technology changes; reduction or deferral of public
funding available to customers; competition from new or better
technology or lower cost products; ability to develop,
commercialize and market new products; market acceptance of oral
fluid or urine testing, collection or other products; market
acceptance and uptake of microbiome informatics, microbial genetics
technology and related analytics services; changes in market
acceptance of products based on product performance or other
factors, including changes in testing guidelines, algorithms or
other recommendations by the Centers for Disease Control and
Prevention (“CDC”) or other agencies; ability to fund research and
development and other products and operations; ability to obtain
and maintain new or existing product distribution channels;
reliance on sole supply sources for critical products and
components; availability of related products produced by third
parties or products required for use of our products; impact of
contracting with the U.S. government; impact of negative economic
conditions; ability to maintain sustained profitability; ability to
utilize net operating loss carry forwards or other deferred tax
assets; volatility of the Company’s stock price; uncertainty
relating to patent protection and potential patent infringement
claims; uncertainty and costs of litigation relating to patents and
other intellectual property; availability of licenses to patents or
other technology; ability to enter into international manufacturing
agreements; obstacles to international marketing and manufacturing
of products; ability to sell products internationally, including
the impact of changes in international funding sources and testing
algorithms; adverse movements in foreign currency exchange rates;
loss or impairment of sources of capital; ability to attract and
retain qualified personnel; exposure to product liability and other
types of litigation; changes in international, federal or state
laws and regulations; customer consolidations and inventory
practices; equipment failures and ability to obtain needed raw
materials and components; the impact of terrorist attacks and civil
unrest; and general political, business and economic conditions.
These and other factors that could affect our results are discussed
more fully in our SEC filings, including our registration
statements, Annual Report on Form 10-K for the year ended December
31, 2020, Quarterly Reports on Form 10-Q, and other filings with
the SEC. Although forward-looking statements help to provide
information about future prospects, readers should keep in mind
that forward-looking statements may not be reliable. Readers are
cautioned not to place undue reliance on the forward-looking
statements. The forward-looking statements are made as of the date
of this press release and OraSure Technologies undertakes no duty
to update these statements.
Investor Contact:Sam MartinArgot
Partners212-600-1902orasure@argotpartners.com |
Media ContactJeanne MellOraSure
Technologies484-353-1575media@orasure.com |
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