CARLSBAD, Calif., May 01, 2018 (GLOBE NEWSWIRE) -- GenMark Diagnostics, Inc. (Nasdaq:GNMK), a leading provider of automated, multiplex molecular diagnostic testing systems, today announced financial results for the first quarter ended March 31, 2018.

Highlights

  • Revenues of $20.6 million, an increase of 65% over the prior year period
  • ePlex net new placements of 32 analyzers, expanding the global installed base to 228 placements
  • Five abstracts and posters on the benefits of ePlex BCID panels presented at ECCMID, the largest microbiology meeting in Europe

“We’re off to a solid start in 2018, with revenue growth in the first quarter driven by high respiratory testing volumes in an exceptionally strong flu season, as well as a growing number of customers utilizing ePlex for routine clinical testing.  As a result, ePlex contributed meaningfully to first quarter sales and for the first time, surpassed revenues from our XT-8 products,” said Hany Massarany, President and Chief Executive Officer. “We’re encouraged by the steady positive customer feedback we receive on the performance, ease of use and processing capacity of ePlex, and we’re very pleased with its strong market acceptance across all segments. We’re also excited about the potential for our uniquely differentiated BCID panels and look forward to accelerating future placements and revenue as we launch them in the U.S. market.”

First Quarter Financial Results
Revenue was $20.6 million in the first quarter of 2018, an increase of 65% versus $12.5 million in the first quarter of 2017.  Gross profit was $4.2 million, or 20% of revenue, compared with $6.2 million, or 49% of revenue in the same period of 2017, reflecting the increased proportion of ePlex revenues in the quarter, driven by extraordinary flu season demand.

Operating expenses for the first quarter of 2018 were $15.0 million compared to $19.7 million in the same period for 2017.  The decrease was largely due to reduced ePlex development expenses, partially offset by an increase in Sales and Marketing expenses.

Loss per share was $0.21 per share for the first quarter of 2018, compared to a $0.30 loss per share in the first quarter of 2017.

The Company ended the quarter with $65.5 million in cash and investments, reflecting the impact of reductions in operating expenses and the focus on minimizing working capital needs.

Guidance for Full Year 2018
GenMark is reconfirming prior 2018 revenue guidance of $68 to $72 million. Gross margin is expected to be in the 30% range. The Company continues to expect ePlex placements of 140-170 net new analyzers, and an annuity per ePlex placement in the $100,000 to $120,000 range.

Webcast and Conference Call Information
The Company will be hosting a conference call to discuss first quarter results in further detail on Tuesday, May 1, 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 www.genmarkdx.com 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 9384229 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 www.genmarkdx.com.

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   
ir@genmarkdx.com


GENMARK DIAGNOSTICS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except par value)

 March 31,
 2018		 December 31,
 2017
ASSETS:
Current Assets:   
Cash and cash equivalents$30,278  $26,754 
Short-term marketable securities35,185  45,236 
Accounts receivable, net of allowances of $52 and $2,754, respectively8,081  10,676 
Inventories10,452  10,949 
Prepaid expenses and other current assets1,490  2,216 
Total current assets85,486  95,831 
    
Property and equipment, net21,881  22,581 
Intangible assets, net2,475  2,624 
Restricted cash758  758 
Other long-term assets507  505 
Total assets$111,107  $122,299 
    
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:   
Accounts payable$9,688  $11,171 
Accrued compensation4,577  5,419 
Current portion of long-term debt13,428  7,927 
Other current liabilities2,912  3,226 
Total current liabilities30,605  27,743 
    
Deferred rent2,893  3,059 
Long-term debt14,868  20,099 
Other noncurrent liabilities187  241 
Total liabilities48,553  51,142 
    
Stockholders' equity:   
Preferred stock, $0.0001 par value; 5,000 authorized, none issued—  — 
Common stock, $0.0001 par value; 100,000 authorized; 55,412 and 55,066 shares issued and outstanding, respectively6  6 
Additional paid-in capital490,306  487,525 
Accumulated deficit(427,808) (416,383)
Accumulated other comprehensive income50  9 
Total stockholders’ equity62,554  71,157 
Total liabilities and stockholders’ equity$111,107  $122,299 



GENMARK DIAGNOSTICS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(In thousands, except per share data)

 Three months ended
 March 31,
 2018 2017
Revenue   
Product revenue$20,576 $12,470
License and other revenue69
 65
Total revenue20,645
 12,535
Cost of revenue16,480
 6,352
Gross profit4,165
 6,183
Operating expenses:   
Sales and marketing5,402
 4,693
General and administrative4,133
 4,011
Research and development5,420
 11,035
Total operating expenses14,955
 19,739
Loss from operations(10,790) (13,556)
Other income (expense):   
Interest income187
 52
Interest expense(788) (507)
Other income (expense)(12) 95
Total other income (expense)(613) (360)
Loss before provision for income taxes(11,403) (13,916)
Income tax expense20 1
Net loss$(11,423) $(13,917)
Net loss per share, basic and diluted$(0.21) $(0.30)
Weighted average number of shares outstanding basic and diluted55,205
 46,846
    
Other comprehensive loss:   
Net loss$(11,423) $(13,917)
Other comprehensive income/(loss):   
Foreign currency translation adjustments, net of tax(34) 91
Net unrealized losses on marketable securities, net of tax8 (16)
Total other comprehensive income/(loss)(26) 75
Total comprehensive loss$(11,449) $(13,842)

GENMARK DIAGNOSTICS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

 Three months ended March 31,
 2018 2017
    
Operating activities:   
Net loss$(11,423) $(13,917)
Adjustments to reconcile net loss to net cash used in operating activities:   
Depreciation and amortization1,740  1,217 
Net amortization/(accretion) of premiums/discounts on investments(42) 19 
Amortization of deferred debt issuance costs290  151 
Stock-based compensation2,724  2,808 
Provision for bad debt—  9 
Non-cash inventory adjustments449  317 
Other non-cash adjustments84  (85)
Changes in operating assets and liabilities:   
Accounts receivable2,566  1,558 
Inventories(526) (3,118)
Prepaid expenses and other assets760  (216)
Accounts payable(1,361) (2,821)
Accrued compensation(992) (1,144)
Other current and non-current liabilities(321) (343)
Net cash used in operating activities(6,052) (15,565)
Investing activities:   
Purchases of property and equipment(465) (1,888)
Purchases of marketable securities(7,900) — 
Proceeds from sales of marketable securities—  13,896 
Maturities of marketable securities18,000  700 
Net cash provided by investing activities9,635  12,708 
Financing activities:   
Principal repayment of borrowings(22) (6)
Payments associated with debt issuance(20) (20)
Proceeds from stock option exercises17  88 
Net cash provided by (used in) financing activities(25) 62 
Effect of exchange rate changes on cash, cash equivalents, and restricted cash(34) 14 
Net increase (decrease) in cash, cash equivalents, and restricted cash3,524  (2,781)
Cash, cash equivalents, and restricted cash at beginning of year27,512  16,717 
Cash, cash equivalents, and restricted cash at end of period$31,036  $13,936 
Non-cash investing and financing activities:   
Transfer of systems to property and equipment from inventory$569  $415 
Property and equipment costs incurred but not paid included in accounts payable$147  $183 
Supplemental cash flow information:   
Cash paid for income taxes, net$33  $5 
Cash paid for interest$508  $347 

 

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