×

Trinity Biotech Announces Results for Q3, 2017

DUBLIN, Ireland, Oct. 26, 2017 (GLOBE NEWSWIRE) -- 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 September 30, 2017.

Quarter 3 Results

Total revenues for Q3, 2017 were $25.6m which is broken down as follows:

2016
Quarter 3
2017
Quarter 3
Increase/
(decrease)
US$’000US$’000%
Point-of-Care4,9034,598(6.2%)
Clinical Laboratory21,22421,006(1.0%)
Total26,12725,604(2.0%)

Point-of-Care revenues for Q3, 2017 decreased from $4.9m to $4.6m. This was primarily due to lower sales of HIV products in Africa.

Meanwhile, Clinical Laboratory sales for the quarter were $21.0m versus $21.2m for the corresponding period last year, thus representing a decrease of 1.0%. However, when the impact of recently culled products is taken into account, underlying Clinical Laboratory sales increased by approximately 2.6%. This growth was mainly driven by higher Premier revenues, including the impact of Premier Resolution, as well as higher autoimmune sales largely driven by strong laboratory services revenues.

The gross margin for the quarter was 43%, which compares to 44.7% in Q3, 2016. This decrease is largely due to lower high margin point-of-care revenues and foreign exchange factors, including the impact of exchange rates on distributor pricing. Whilst the gross margin is lower than in the comparative period it continues the trend of sequentially improving gross margins witnessed in recent quarters.

Research and Development expenses increased from $1.3m in Q3, 2016 to $1.5m in Q3, 2017. Meanwhile, Selling, General and Administrative (SG&A) expenses increased from $7.5m to $7.8m in Q3, 2017, an increase of approximately 3%. This increase was due to normal inflationary pressures and higher discretionary sales and marketing expenses such as trade shows and travel costs.

Operating profit for the quarter decreased from $2.7m to $1.5m. This was due to the combined impact of the lower revenues and gross margin and the higher indirect costs incurred during the quarter.

Both financial income and interest payable for the quarter remained static at $0.2m and $1.2m respectively. The interest payable arises mainly on the Company’s exchangeable notes. A further non-cash expense of $0.1m was recognised in this quarter’s income statement, again in relation to the exchangeable notes. This was due to a non-cash interest charge of $0.2m partially offset by a gain of $0.1m arising on a decrease in the fair value of the derivatives embedded in these notes.

Overall, the Company recorded a profit of $0.4m for the quarter, which equates to earnings per share of 2.1 cents. However, excluding non-cash items the profit for the quarter was $0.5m or an EPS of 2.4 cents. Fully diluted EPS for the quarter was 6.3 cents compared to 9.7 cents in Q3, 2016.

EBITDA before share option expense for the quarter was $3.1m.

Share Buyback

During the quarter, the Company repurchased 281,000 ADRs at an average price of $5.49 and with a total value of $1.5m. This brings the total purchased since the beginning of the program to approximately 2.1m shares with a total value of $15.8m.

Comments

Commenting on the results, Kevin Tansley, Chief Financial Officer, said “This quarter we demonstrated continued progress from a financial perspective. As well achieving underlying growth in our Clinical Laboratory revenues, we also reported an increase in gross margins for the third quarter in a row. However, this has not immediately translated into higher profits as our indirect costs were slightly higher this quarter, due to increased investment in both R&D and sales and marketing activities as we seek to drive future revenue growth. Another positive aspect was that we generated positive free cash flows this quarter, thus reflecting the improved cash flows of the Company following the suspension of the Meritas project in late 2016.”

Ronan O’Caoimh, CEO of Trinity said “This quarter underlying growth in our key Clinical Laboratory segment was driven by higher haemoglobin and autoimmune revenues. Our haemoglobin revenues are now being boosted by new sales of our recently launched Premier Resolution instrument, which specifically targets the haemogloblin variant market. This instrument is building on the continued success of our Premier 9210 Diabetes instrument, which is now the market leader in a number of countries. Meanwhile, our autoimmune revenues are increasing as we grow our laboratory services business through a combination of increased testing menu and the ongoing development of key commercial relationships. We continue to retain our pre-eminent position in the confirmatory HIV testing market in Africa and whilst revenues were down this quarter, year to date sales are in line with last year. Future growth opportunities in the HIV market will come from our forthcoming entry into the HIV screening market in Africa.

We believe that the current strength of our product portfolio and the growth opportunities inherent in our business are not fully reflected in our current share price. Consequently we remain committed to buying back a significant number of Trinity shares at these levels.”

Forward-looking statements in this release are made pursuant to the "safe harbor" provision of the Private Securities 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
Ended
September 30,
2017
(unaudited)
Three Months
Ended
September 30,
2016
(unaudited)
Nine Months
Ended
September 30,
2017
(unaudited)
Nine Months
Ended
September 30,
2016
(unaudited)
Revenues 25,604 26,127 74,588 75,931
Cost of sales (14,606)(14,460)(42,889)(42,316)
Gross profit 10,998 11,667 31,699 33,615
Gross margin % 43.0%44.7%42.5%44.3%
Other operating income 25 70 73 211
Research & development expenses (1,469)(1,296)(4,119)(3,711)
Selling, general and administrative expenses (7,761)(7,487)(22,341)(22,245)
Indirect share based payments (265)(236)(644)(971)
Operating profit 1,528 2,718 4,668 6,899
Financial income 212 212 584 657
Financial expenses (1,168)(1,179)(3,506)(3,545)
Net financing expense (956)(967)(2,922)(2,888)
Profit before tax & non-cash financial income / (expense) 572 1,751 1,746 4,011
Income tax expense (56)(148)(331)(462)
Profit for the period before non-cash financial income / (expense) 516 1,603 1,415 3,549
Non-cash financial income / (expense) (71)(2,120)1,178 (3,308)
Profit / (loss) after tax and once-off items 445 (517)2,593 241
Earnings per ADR (US cents)
2.1 (2.3)11.9 1.0
Earnings per ADR excluding non-cash financial income (US cents) 2.4 7.0 6.5 15.4
Diluted earnings per ADR (US cents) 6.3* 9.7* 18.0* 24.6*
Weighted average no. of ADRs used in computing basic earnings per ADR 21,379,422 22,797,208 21,773,874 23,032,885
Weighted average no. of ADRs used in computing diluted earnings per ADR 26,636,857 28,379,444 27,031,396 28,452,580

* Under IAS 33 Earnings per Share, diluted earnings per share cannot be anti-dilutive. In a reporting period where it is anti-dilutive, diluted earnings per ADR should be constrained to equal basic earnings per ADR.

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
September 30,
2017
US$ ‘000
(unaudited)
June 30,
2017
US$ ‘000
(unaudited)
March 31,
2017
US$ ‘000
(unaudited)
Dec 31,
2016
US$ ‘000
(unaudited)
ASSETS
Non-current assets
Property, plant and equipment15,191 14,462 14,163 13,403
Goodwill and intangible assets92,185 90,438 88,996 87,275
Deferred tax assets15,074 15,352 14,669 14,556
Other assets904 873 828 870
Total non-current assets123,354 121,125 118,656 116,104
Current assets
Inventories32,711 33,620 32,659 32,589
Trade and other receivables24,603 24,856 22,683 22,586
Income tax receivable1,427 1,220 1,290 1,205
Cash and cash equivalents62,529 63,977 69,851 77,108
Total current assets121,270 123,673 126,483 133,488
TOTAL ASSETS244,624 244,798 245,139 249,592
EQUITY AND LIABILITIES
Equity attributable to the equity holders of the parent
Share capital1,224 1,176 1,176 1,224
Share premium16,077 16,122 16,122 16,187
Accumulated surplus89,878 90,977 93,171 93,004
Other reserves(792)(1,409)(1,193)(1,688)
Total equity106,387 106,866 109,276 108,727
Current liabilities
Income tax payable502 582 181 175
Trade and other payables22,923 22,572 20,893 25,028
Provisions75 75 75 75
Total current liabilities23,500 23,229 21,149 25,278
Non-current liabilities
Exchangeable senior note payable95,316 95,245 95,462 96,491
Other payables582 640 698 735
Deferred tax liabilities18,839 18,818 18,554 18,361
Total non-current liabilities114,737 114,703 114,714 115,587
TOTAL LIABILITIES138,237 137,932 135,863 140,865
TOTAL EQUITY AND LIABILITIES244,624 244,798 245,139 249,592

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
Ended
September 30,
2017
(unaudited)
Three Months
Ended
September 30,
2016
(unaudited)
Nine Months
Ended
September 30,
2017
(unaudited)
Nine Months
Ended
September 30,
2016
(unaudited)
Cash and cash equivalents at beginning of period63,977 84,920 77,109 101,953
Operating cash flows before changes in working capital3,672 5,164 9,679 12,950
Changes in working capital313 393 (2,262)(3,469)
Cash generated from operations3,985 5,557 7,417 9,481
Net Interest and Income taxes (paid)/received86 (171)324 (263)
Capital Expenditure & Financing (net)(3,727)(5,555)(10,559)(16,982)
Free cash flow344 (169)(2,818)(7,764)
Share buyback(1,543)- (6,472)(6,026)
Payment of HIV-2 licence fee- - (1,112)(1,112)
30 year Exchangeable Note interest payment- - (2,300)(2,300)
Once-off items(249)- (1,878)-
Cash and cash equivalents at end of period62,529 84,751 62,529 84,751

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

Source:Trinity Biotech plc