GenMark Diagnostics Reports Fourth Quarter and Full Year 2017 Results

CARLSBAD, Calif., Feb. 27, 2018 (GLOBE NEWSWIRE) -- GenMark Diagnostics, Inc. (Nasdaq:GNMK), a leading provider of automated, multiplex molecular diagnostic testing systems, today announced financial results for the fourth quarter and full year ended December 31, 2017.


  • Revenues for the fourth quarter of 2017 were $16.0 million, an increase of 8% over the prior year period
  • Revenues for the full year 2017 were $52.5 million, representing an increase of 7% over 2016
  • Placed 49 ePlex® analyzers in the fourth quarter of 2017
  • Exited the year with an installed base of 196 ePlex analyzers in U.S. and European labs
  • XT-8 installed base remained relatively stable at 620 analyzers in U.S. labs

“In 2017, we achieved several significant product launches that are fundamental to the continued growth and success of our business. We launched our FDA cleared ePlex system and Respiratory Pathogen Panel in the U.S. ahead of the current severe flu season, and we introduced our ePlex family of CE Marked BCID sepsis panels in Europe. We’re also very pleased with the recent launch of our ePlex NP system, which we designed to address lower test-volume sites and decentralized near patient settings,” said Hany Massarany, President and Chief Executive Officer. “Looking ahead, we are excited about the opportunity we have in 2018 and beyond, to drive ePlex commercialization with an expanded menu of test panels and a rapidly growing number of customers utilizing ePlex for routine clinical testing,” concluded Massarany.

Fourth Quarter Financial Results
Revenue was $16.0 million in the fourth quarter of 2017, an increase of 8% versus $14.9 million in the fourth quarter of 2016. Gross profit was $4.7 million, or 30% of revenue, compared with $8.6 million, or 58% of revenue in the same period of 2016, reflecting the increased proportion of ePlex revenues in the quarter.

Annuity per XT-8 analyzer was approximately $65,000 over the last 4 quarters. Annuity per ePlex analyzer was approximately $120,000 in the fourth quarter.

Operating expenses for the fourth quarter of 2017 were $18.7 million compared to $20.7 million in the same period for 2016. The decrease was largely due to reduced ePlex development expenses.

Loss per share was $0.26 per share for the fourth quarter of 2017, compared to a $0.27 loss per share in the fourth quarter of 2016.

The Company ended the quarter with $72.0 million in cash and investments, reflecting the impact of increasing inventory levels in advance of the flu season.

Guidance for Full Year 2018
GenMark projects revenue for the full year 2018 to range from $68 to $72 million. Gross margin is expected to be in the mid 30% range and operating expenses in the mid-$60 million range. The Company expects ePlex placements of 140-170 analyzers, and an annuity per ePlex placement in the range of $100,000 to $120,000.

Webcast and Conference Call Information
The Company will be hosting a conference call to discuss fourth quarter results in further detail on Tuesday, February 27, 2018 starting at 4:30 p.m. ET. The conference call will be concurrently webcast. The link to the webcast will be available on the GenMark Diagnostics, Inc. website at under the investor relations section and will be archived for future reference. To listen to the conference call, please dial (877) 312-5847 (US/Canada) or (253) 237-1154 (International) and use the conference ID number 3489404 approximately five minutes prior to the start time.

About GenMark Diagnostics
GenMark Diagnostics (NASDAQ:GNMK) is a leading provider of multiplex molecular diagnostic solutions designed to enhance patient care, improve key quality metrics, and reduce the total cost-of-care. Utilizing GenMark's proprietary eSensor® detection technology, GenMark's eSensor XT-8® and ePlex® systems are designed to support a broad range of molecular diagnostic tests with compact, easy-to-use workstations and self-contained, disposable test cartridges. GenMark’s ePlex: The True Sample-to-Answer Solution™ is designed to optimize laboratory efficiency and address a broad range of infectious disease testing needs, including respiratory, bloodstream, and gastrointestinal infections. For more information, visit

Safe Harbor Statement
This press release includes forward-looking statements regarding events, trends and business prospects, which may affect our future operating results and financial position. Such statements, including, but not limited to, those regarding our future financial performance, regulatory submissions and approvals, and the timely and effective commercialization and clinical impact of our ePlex system, are all subject to risks and uncertainties that could cause our actual results and financial position to differ materially. Some of these risks and uncertainties include, but are not limited to, our ability to successfully commercialize our ePlex system and its related test menu in a timely manner, constraints or inefficiencies caused by unanticipated acceleration and deceleration of customer demand, our ability to successfully expand sales of our product offerings outside the United States, and third-party payor reimbursement to our customers, as well as other risks and uncertainties described under the “Risk Factors” in our public filings with the Securities and Exchange Commission. We assume no responsibility to update or revise any forward-looking statements to reflect events, trends or circumstances after the date they are made.

Investor Relations Contact
Lynn Pieper Lewis or Leigh Salvo
(415) 937-5404

(In thousands, except par value)

As of December 31,
2017 2016
Current Assets:
Cash and cash equivalents$26,754 $15,959
Short-term marketable securities45,236 25,607
Accounts receivable, net of allowances of $2,754 and $2,740, respectively10,676 9,048
Inventories10,949 6,633
Prepaid expenses and other current assets1,792 1,202
Total current assets95,407 58,449
Property and equipment, net22,581 18,268
Intangible assets, net2,624 2,670
Restricted cash758 758
Other long-term assets192 179
Total assets$121,562 $80,324
Current liabilities:
Accounts payable$11,171 $8,703
Accrued compensation5,419 5,650
Current portion of long-term debt7,927 7,935
Other current liabilities3,226 4,133
Total current liabilities27,743 26,421
Deferred rent3,059 3,652
Long-term debt20,099 11,880
Other noncurrent liabilities241 220
Total liabilities51,142 42,173
Stockholders' equity
Preferred stock, $0.0001 par value; 5,000 authorized, none issued
Common stock, $0.0001 par value; 100,000 authorized; 55,066 and 46,554 shares issued and outstanding, respectively6 4
Additional paid-in capital487,525 393,322
Accumulated deficit(417,120) (355,270)
Accumulated other comprehensive income9 95
Total stockholders’ equity70,420 38,151
Total liabilities and stockholders’ equity$121,562 $80,324

(In thousands, except per share data)

Three Months Ended December 31, Twelve Months Ended December 31,
2017 2016 2017 2016
(unaudited) (unaudited)
Product revenue$15,947 $14,803 $52,260 $48,914
License and other revenue75 82 259 360
Total revenue16,022 14,885 52,519 49,274
Cost of revenue11,287 6,243 32,514 19,700
Gross profit4,735 8,642 20,005 29,574
Operating expenses:
Sales and marketing5,584 4,501 20,557 14,734
General and administrative4,651 3,841 16,205 14,363
Research and development8,463 12,358 42,760 49,458
Total operating expenses18,698 20,700 79,522 78,555
Loss from operations(13,963) (12,058) (59,517) (48,981)
Other income (expense):
Interest income208 77 561 176
Interest expense(771) (474) (3,042) (1,536)
Other income (expense)22 (168) 249 (160)
Total other income (expense)(541) (565) (2,232) (1,520)
Loss before provision for income taxes(14,504) (12,623) (61,749) (50,501)
Income tax expense32 55 101 100
Net loss$(14,536) $(12,678) $(61,850) $(50,601)
Net loss per share, basic and diluted$(0.26) $(0.27) $(1.21) $(1.15)
Weighted average number of shares outstanding basic and diluted54,910 46,458 51,169 44,100
Other comprehensive loss
Net loss$(14,536) $(12,678) $(61,850) $(50,601)
Other comprehensive income/(loss):
Foreign currency translation adjustments, net of tax(229) 86 (84) 77
Net unrealized losses on marketable securities, net of tax22 (13) (2) (11)
Total other comprehensive income/(loss)(207) 73 (86) 66
Total comprehensive loss$(14,743) $(12,605) $(61,936) $(50,535)

(In thousands)

Years ended December 31,
2017 2016 2015
Operating activities:
Net loss$(61,850) $(50,601) $(42,197)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization5,317 3,916 3,405
Net amortization/(accretion) of premiums/discounts on investments(39) 89 180
Gain on sale of investment in preferred stock (9) (223)
Amortization of deferred debt issuance costs1,132 388 285
Stock-based compensation12,170 9,236 9,995
Provision for bad debt14 13 25
Non-cash inventory adjustments1,323 134 594
Other non-cash adjustments(224) 145 186
Changes in operating assets and liabilities:
Accounts receivable(1,555) (2,250) (1,983)
Inventories(10,512) (3,450) (1,286)
Prepaid expenses and other assets(599) (613) (36)
Accounts payable2,557 4,105 (757)
Accrued compensation(263) 2,172 (458)
Other current and non-current liabilities(893) 1,088 355
Net cash used in operating activities(53,422) (35,637) (31,915)
Investing activities:
Payments for intellectual property licenses(500) (1,500) (550)
Purchases of property and equipment(4,815) (7,000) (3,756)
Purchases of marketable securities(70,989) (33,688) (22,646)
Proceeds from sales of marketable securities13,896 8,015 223
Maturities of marketable securities37,500 10,050 46,050
Net cash provided by (used in) investing activities(24,908) (24,123) 19,321
Financing activities:
Proceeds from issuance of common stock87,267 30,920 884
Costs incurred in conjunction with public offering(5,469) (1,143)
Principal repayment of borrowings(7,848) (40) (22)
Proceeds from borrowings15,000 10,000 10,000
Costs associated with debt issuance(187) (90) (718)
Proceeds from stock option exercises287 712 989
Net cash provided by financing activities89,050 40,359 11,133
Effect of exchange rate changes on cash75 (25) (9)
Net increase (decrease) in cash and cash equivalents10,795 (19,426) (1,470)
Cash and cash equivalents at beginning of year15,959 35,385 36,855
Cash and cash equivalents at end of year$26,754 $15,959 $35,385
Non-cash investing and financing activities:
Transfer of systems from property and equipment into inventory$4,885 $263 $225
Property and equipment costs incurred but not paid included in accounts payable$227 $1,159 $146
Intellectual property acquisition included in accrued expenses$ $ $800
Supplemental cash flow information:
Cash paid for interest$1,643 $1,130 $572
Cash paid for income taxes, net$61 $65 $10

Source:GenMark Diagnostics, Inc.