UNION CITY, Calif.,
Jan. 25, 2018 /PRNewswire/
-- Abaxis, Inc. (Nasdaq: ABAX), a global diagnostics company
manufacturing point-of-care blood analysis instruments and
consumables for the medical and veterinary markets worldwide, today
reported financial results for the third fiscal quarter ended
December 31, 2017.
Third quarter results include:
- Revenues of $59.7 million, up 13%
over last year's comparable quarter.
- Diluted net income per share of $0.18, compared to $0.30 in last year's comparable quarter.
Diluted net income per share for the third quarter of fiscal 2018
includes the effect of a one-time non-cash charge of $2.9 million as a result of the Tax Cuts and Jobs
Act ("TCJA") enacted on December 22,
2017. Excluding the effect of this non-cash charge, non-GAAP
diluted net income per share was $0.31 for the third quarter of fiscal 2018.
Revenues highlights:
- Medical market revenues of $10.2
million, up 18% over last year's comparable quarter.
- Veterinary market revenues of $48.4
million, up 12% over last year's comparable quarter.
- Revenues from sales of consumables, which include reagent
discs, hematology reagent kits, VSpro specialty cartridges,
i-STAT cartridges, rapid tests and urinalysis tests, of
$45.5 million, up 13% over last
year's comparable quarter.
- Total medical and veterinary reagent disc revenues of
$31.9 million, up 13% over last
year's comparable quarter.
- Total medical and veterinary reagent disc sales of 2.6 million
units, up 13% over last year's comparable quarter.
- Total medical and veterinary instrument revenues of
$10.5 million, up 12% over last
year's comparable quarter.
- Total medical and veterinary instrument sales of 2,836 units,
compared to 1,385 units in last year's comparable quarter.
- North America revenues of
$46.4 million, up 12% over last
year's comparable quarter.
- International revenues of $13.2
million, up 18% over last year's comparable quarter.
Other financial highlights:
- Gross profit of $32.2 million,
compared to $29.4 million, in last
year's comparable quarter.
- Cash, cash equivalents and investments as of December 31, 2017 of $185.0 million.
- Abaxis paid dividends of $3.6
million, or $0.16 per share,
during the third quarter of fiscal 2018.
Management Discussion
Clint Severson, chairman and
chief executive officer of Abaxis, said, "We are very pleased to
achieve revenues of $59.7 million in
the third quarter, an increase of 13% compared to the same period
last year. Driven by a strong growth in instrument and
consumable sales during the third quarter, revenues in our medical
and veterinary market segments increased by 18% and 12%,
respectively, compared to the same period last year. Year-over-year
revenue growth of medical and veterinary reagent discs was 17% and
12%, respectively, in the third quarter, over the same period last
year."
Mr. Severson continued, "Our new VetScan UA, a urine chemistry
analyzer, had a tremendous launch, as we sold over 1,300
instruments since its introduction in late September
2017. Additionally, during the third quarter of fiscal 2018,
we placed over 100 units of the VetScan FUSE, a bi-directional
connectivity system that provides integration between Abaxis
point-of-care analyzers and veterinary practice management systems
worldwide.
"We are excited about our outlook for the fourth quarter of
fiscal 2018 based on our expectations for growth in the core
business and several important new product launches. For
example, we plan to launch our new urine sediment analyzer which
targets a large veterinary market segment later this quarter.
Furthermore, the USDA, Center for Veterinary Biologics, recently
approved our VetScan FLEX4 Rapid Test, a combination test for
heartworm, lyme, ehrlichia and anaplasma. We are excited to
introduce and sell this product to veterinarians at the VMX
conference in early February
2018."
Mr. Severson concluded, "Looking to the future, we anticipate
making additional investments in new product development. With
our focus on innovation and an expanding field sales force we are
optimistic about our future."
Dividend Declared
Abaxis today announced that its Board of Directors declared a
quarterly cash dividend of $0.16 per
share of common stock, to be paid on March
15, 2018, to all shareholders of record as of the close of
business on March 1, 2018.
Results of Operations
Quarterly Results
For the fiscal quarter ended December 31,
2017, Abaxis reported revenues of $59.7 million, as compared with revenues of
$52.8 million for the comparable
period last year. Revenues from sales of instruments, which include
chemistry analyzers, hematology instruments, VSpro specialty
analyzers, i‑STAT analyzers and urinalysis instruments, increased
by $1.1 million, or 12%, compared to
the same period last year. Revenues from sales of consumables,
which include reagent discs, hematology reagent kits, VSpro
specialty cartridges, i‑STAT cartridges, rapid tests and urinalysis
tests, increased by $5.1 million, or
13%, over the same period last year.
Abaxis reported income from continuing operations before income
tax provision of $9.5 million and net
income from continuing operations of $4.2
million for the fiscal quarter ended December 31, 2017, compared to $10.8 million and $6.9
million for the fiscal quarter ended December 31, 2016, respectively.
Abaxis' effective tax rate in the fiscal quarter ended
December 31, 2017 was 55%, compared
to 36% for the same period last year. During the third quarter
of fiscal 2018, Abaxis recorded a one-time non-cash charge of
$2.9 million due to a reduction in
deferred tax assets as a result of the reduction of the federal tax
rate from 35% to 21% effective January
1, 2018.
Abaxis reported diluted net income per share of $0.18 (calculated based on 23,044,000 shares) for
the fiscal quarter ended December 31,
2017, compared to $0.30 per
share (calculated based on 22,789,000 shares) for the same period
last year. Excluding the effect of the non-cash charge of
$2.9 million, non-GAAP diluted net
income per share was $0.31 for the
third quarter of fiscal 2018.
Nine-Month Results
For the nine-month period ended December
31, 2017, Abaxis reported revenues of $176.8 million, as compared with revenues of
$169.0 million for the comparable
period last year. Revenues from instruments sales decreased by
$0.9 million, or 3%, compared to the
same period last year. Revenues from consumables sales
increased by $7.3 million, or 6%,
over the same period last year.
Abaxis reported income from continuing operations before income
tax provision of $29.4 million and
net income from continuing operations of $17.2 million for the nine-month period ended
December 31, 2017, compared to
$39.5 million and $25.2 million for the nine-month period ended
December 31, 2016,
respectively. Abaxis' effective tax rate in the nine-month
period ended December 31, 2017 was
42%, compared to 36% for the same period last year. During the
nine-month period ended December 31,
2017, Abaxis recorded a one-time non-cash charge of
$2.9 million due to a reduction in
deferred tax assets as a result of the reduction of the federal tax
rate from 35% to 21% effective January
1, 2018.
Abaxis reported diluted net income per share of $0.75 (calculated based on 23,021,000 shares) for
the fiscal period ended December 31,
2017, compared to $1.11 per
share (calculated based on 22,753,000 shares) for the same period
last year. Excluding the effect of the non-cash charge of
$2.9 million, non-GAAP diluted net
income per share was $0.87 for the
nine month period ended December 31,
2017.
Other Reported Information
Non-cash compensation expense recognized for share-based awards
during the three months ended December 31,
2017 and 2016 was $3.6 million
and $2.4 million,
respectively. Abaxis paid $3.6
million in cash dividends to shareholders during the third
quarter of fiscal 2018.
Following the recent enactment of the TCJA on December 22, 2017, Abaxis expects its effective
income tax rate to decline by 200 to 300 basis points in fiscal
2018 compared to fiscal 2017, excluding a one-time non-cash charge
described above. Abaxis estimates its effective income tax
rate in fiscal 2019 will be lower by 1,000 to 1,200 basis points
compared to fiscal 2017. The actual impact of the TCJA on the
Company's effective income tax rates may differ from the estimates
due to changes in interpretations and assumptions made by the
Company. The Company anticipates subsequent regulations
associated with the TCJA will be forthcoming and will continue to
analyze the tax legislation to determine the full effects of the
new law on Abaxis' consolidated financial statements.
Conference Call
Abaxis has scheduled a conference call to discuss its financial
results at 4:15 p.m. Eastern Time on
Thursday, January 25, 2018. Participants can dial (844)
855-9498 or (412) 317-5496 to access the conference call, or can
listen via a live Internet webcast, which is available in the
Investor Relations section of the company's website at
http://www.abaxis.com. A replay of the call will be available
by visiting http://www.abaxis.com for the next 30 days or by
calling (877) 344-7529 or (412) 317-0088, confirmation code
10116166, through February 1,
2018. This press release is also available prior to and after
the call via Abaxis' website or the Securities and Exchange
Commission's website at http://www.sec.gov.
About Abaxis
Abaxis, Inc. is a worldwide developer, manufacturer and marketer
of portable blood analysis systems that are used in a broad range
of medical specialties in human or veterinary patient care to
provide clinicians with rapid blood constituent
measurements. Our mission is to improve the efficiency of care
delivery to and the quality of life of patients in the medical and
veterinary markets. We provide leading edge technology and
tools that support best medical practices, enabling physicians and
veterinarians to respond to the health needs of their clients at
the point of care while operating economical and profitable
practices. For more information, visit
http://www.abaxis.com.
Non-GAAP Financial Measure
To supplement the financial statements presented in accordance
with accounting principles generally accepted in the United States of America (GAAP), Abaxis
uses the non-GAAP financial measure of non-GAAP diluted net income
per share. The presentation of this financial information is
not intended to be considered in isolation or as a substitute for,
or superior to, the financial information prepared and presented in
accordance with GAAP. Abaxis defines non-GAAP diluted net
income per share as net income per share on a diluted basis
excluding from net income the one-time non-cash charge due to a
reduction in deferred tax assets as a result of the TCJA enacted on
December 22, 2017. Abaxis uses
this non-GAAP financial measure for financial and operational
decision making and as a means to evaluate period-to-period
comparisons. Management believes that this non-GAAP financial
measure provides meaningful supplemental information regarding
Abaxis' performance and liquidity by excluding a one-time non-cash
charge resulting from changes to tax laws, that may not be
indicative of recurring core business operating results or
operating performance. A reconciliation from GAAP net income
and GAAP diluted net income per share to non-GAAP net income and
non-GAAP diluted net income per share, respectively, has been
provided in the financial statement tables included below in this
press release.
Forward Looking Statements
This press release includes statements that constitute
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 (the "Reform Act"),
including but not limited to statements related to Abaxis' outlook
for the fourth quarter of fiscal 2018, Abaxis' expected effective
income tax rates in fiscal 2018 and fiscal 2019, the launch of
Abaxis' urine sediment analyzer, estimated timing of introduction
of the FLEX4 Rapid Test to the market, Abaxis' anticipated
additional investments, further innovation and expansion of sales
force and their impact on Abaxis' future and Abaxis' payment of
quarterly dividends. Abaxis claims the protection of the
safe-harbor for forward-looking statements contained in the Reform
Act. These forward-looking statements are often characterized
by the terms "may," "believes," "projects," "expects,"
"anticipates," or words of similar import, and do not reflect
historical facts. Forward-looking statements contained in
this press release may be affected by risks and uncertainties that
may cause actual results to differ materially from those projected
or implied in such forward-looking statements, including, but not
limited to, risks and uncertainties related to Abaxis'
manufacturing operations, including the vulnerability of its
manufacturing operations to potential interruptions and delays and
its ability to manufacture products free of defects, Abaxis'
ability to compete effectively, market acceptance of Abaxis'
products, fluctuations in quarterly operating results and
difficulty in predicting future results, the performance of Abaxis'
independent distributors and Abaxis' ability to manage their
inventory levels effectively, expansion of Abaxis' sales and
marketing and distribution efforts, Abaxis' dependence on Abbott
Point of Care, Inc. for its U.S. medical sales, dependence on sole
or limited source suppliers, the effect of exchange rate
fluctuations on international operations, dependence on key
personnel, risks related to the protection of Abaxis' intellectual
property or claims of infringement of intellectual property
asserted by third parties. Readers should also refer to the
section entitled "Risk Factors" in Abaxis' Annual Report on Form
10-K, and subsequently filed quarterly reports on Form 10-Q filed
with the United States Securities and Exchange Commission.
Forward-looking statements speak only as of the date the statements
were made. Abaxis does not undertake and specifically
disclaims any obligation to update any forward-looking
statements.
Financial Tables to Follow
ABAXIS,
INC. Condensed Consolidated Statements of
Income (Unaudited) (In thousands, except per
share data)
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2017
|
2016
|
|
2017
|
2016
|
Revenues
|
|
$
59,670
|
$
52,772
|
|
$
176,782
|
$
169,020
|
Cost of
revenues
|
|
27,494
|
23,368
|
|
80,501
|
75,357
|
Gross
profit
|
|
32,176
|
29,404
|
|
96,281
|
93,663
|
Operating
expenses:
|
|
|
|
|
|
|
Research
and development
|
|
5,165
|
4,776
|
|
17,672
|
14,915
|
Sales
and marketing
|
|
13,657
|
10,629
|
|
38,642
|
33,707
|
General
and administrative
|
|
4,777
|
3,159
|
|
13,494
|
11,714
|
Total operating
expenses
|
|
23,599
|
18,564
|
|
69,808
|
60,336
|
Income from
operations
|
|
8,577
|
10,840
|
|
26,473
|
33,327
|
Interest and other
income (expense), net
|
|
878
|
(52)
|
|
2,962
|
6,197
|
Income from
continuing operations before income tax provision
|
|
9,455
|
10,788
|
|
29,435
|
39,524
|
Income tax
provision
|
|
5,229
|
3,929
|
|
12,278
|
14,288
|
Income from
continuing operations
|
|
4,226
|
6,859
|
|
17,157
|
25,236
|
Discontinued
operations
|
|
|
|
|
|
|
Loss from
discontinued operations, net of tax
|
|
-
|
(15)
|
|
-
|
(70)
|
Net income
|
|
$
4,226
|
$
6,844
|
|
$
17,157
|
$
25,166
|
|
|
|
|
|
|
|
Net income per
share:
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
Continuing operations
|
|
$
0.19
|
$
0.30
|
|
$
0.76
|
$
1.12
|
Discontinued operations
|
|
-
|
-
|
|
-
|
-
|
Basic net
income per share
|
|
$
0.19
|
$
0.30
|
|
$
0.76
|
$
1.12
|
|
|
|
|
|
|
|
Diluted
|
|
|
|
|
|
|
Continuing operations
|
|
$
0.18
|
$
0.30
|
|
$
0.75
|
$
1.11
|
Discontinued operations
|
|
-
|
-
|
|
-
|
-
|
Diluted net
income per share
|
|
$
0.18
|
$
0.30
|
|
$
0.75
|
$
1.11
|
|
|
|
|
|
|
|
Shares used in the
calculation of net income per share:
|
|
|
|
|
|
|
Weighted
average common shares outstanding - basic
|
|
22,695
|
22,535
|
|
22,663
|
22,508
|
Weighted
average common shares outstanding - diluted
|
|
23,044
|
22,789
|
|
23,021
|
22,753
|
|
|
|
|
|
|
|
Cash dividends
declared per share
|
|
$
0.16
|
$
0.14
|
|
$
0.44
|
$
0.38
|
ABAXIS,
INC. Condensed Consolidated Balance
Sheets (Unaudited and in thousands)
|
|
|
December
31,
|
March
31,
|
|
|
2017
|
2017
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
|
$
71,902
|
$
91,332
|
Short-term
investments
|
|
89,717
|
51,561
|
Receivables,
net
|
|
40,391
|
40,568
|
Inventories
|
|
42,498
|
39,010
|
Prepaid
expenses and other current assets
|
|
6,250
|
4,997
|
Net deferred
tax assets, current
|
|
-
|
5,644
|
Current assets
of discontinued operations
|
|
45
|
66
|
Total
current assets
|
|
250,803
|
233,178
|
Long-term
investments
|
|
23,333
|
22,171
|
Investment in
unconsolidated affiliates
|
|
2,732
|
2,850
|
Property and
equipment, net
|
|
34,902
|
34,260
|
Intangible assets,
net
|
|
1,056
|
1,171
|
Net deferred tax
assets, non-current
|
|
7,489
|
4,392
|
Other
assets
|
|
9,224
|
7,624
|
Total
assets
|
|
$
329,539
|
$
305,646
|
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
|
$
13,170
|
$
7,517
|
Accrued payroll
and related expenses
|
|
10,285
|
9,606
|
Accrued
taxes
|
|
47
|
2,151
|
Current
liabilities of discontinued operations
|
|
50
|
85
|
Other accrued
liabilities
|
|
15,648
|
11,006
|
Deferred
revenue
|
|
1,054
|
1,415
|
Warranty
reserve
|
|
2,129
|
1,663
|
Total
current liabilities
|
|
42,383
|
33,443
|
Non-current
liabilities:
|
|
|
|
Deferred
revenue
|
|
1,278
|
1,460
|
Warranty
reserve
|
|
2,864
|
2,695
|
Net deferred
tax liabilities
|
|
211
|
234
|
Notes payable,
less current portion
|
|
202
|
278
|
Other
non-current liabilities
|
|
1,544
|
1,312
|
Total
non-current liabilities
|
|
6,099
|
5,979
|
Total
liabilities
|
|
48,482
|
39,422
|
Shareholders'
equity:
|
|
|
|
Common
stock
|
|
143,640
|
135,932
|
Retained
earnings
|
|
137,481
|
130,304
|
Accumulated
other comprehensive loss
|
|
(64)
|
(12)
|
Total
shareholders' equity
|
|
281,057
|
266,224
|
Total
liabilities and shareholders' equity
|
|
$
329,539
|
$
305,646
|
Revenues by
Geographic Region and Customer Group (Unaudited and in
thousands)
|
The following table presents our revenues by source for the
three and nine months ended December 31,
2017 and 2016.
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2017
|
2016
|
|
2017
|
2016
|
Revenues by
Geographic Region
|
|
|
|
|
|
|
North
America
|
|
$
46,442
|
$
41,538
|
|
$
140,331
|
$
135,328
|
International
|
|
13,228
|
11,234
|
|
36,451
|
33,692
|
Total
revenues
|
|
$
59,670
|
$
52,772
|
|
$
176,782
|
$
169,020
|
|
|
|
|
|
|
|
Revenues by
Customer Group
|
|
|
|
|
|
|
Medical
Market
|
|
$
10,193
|
$
8,652
|
|
$
28,337
|
$
27,130
|
Veterinary
Market
|
|
48,424
|
43,198
|
|
145,328
|
139,219
|
Other
|
|
1,053
|
922
|
|
3,117
|
2,671
|
Total
revenues
|
|
$
59,670
|
$
52,772
|
|
$
176,782
|
$
169,020
|
The following table presents our calculation of non-GAAP net
income and non-GAAP diluted net income per share to exclude a
one-time non-cash charge of $2.9
million in the three and nine months ended December 31, 2017 due to a reduction in deferred
tax assets as a result of the TCJA enacted on December 22, 2017.
Reconciliation
from GAAP Net Income to Non-GAAP Net Income and GAAP Diluted Net
Income Per Share to Non-GAAP Diluted Net Income Per
Share
|
(In thousands,
except per share data)
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
December 31,
2017
|
|
December 31,
2017
|
|
|
GAAP
|
|
Non-GAAP
|
|
GAAP
|
|
Non-GAAP
|
|
|
Results
|
Adjustments
(1)
|
Results
|
|
Results
|
Adjustments
(1)
|
Results
|
Income from
continuing operations before income tax provision
|
|
$
9,455
|
$
-
|
$
9,455
|
|
$
29,435
|
$
-
|
$
29,435
|
Income tax
provision
|
|
5,229
|
(2,939)
|
2,290
|
|
12,278
|
(2,939)
|
9,339
|
Income from
continuing operations
|
|
4,226
|
2,939
|
7,165
|
|
17,157
|
2,939
|
20,096
|
Discontinued
operations
|
|
|
|
|
|
|
|
|
Loss from
discontinued operations, net of tax
|
|
-
|
-
|
-
|
|
-
|
-
|
-
|
Net income
|
|
$
4,226
|
$
2,939
|
$
7,165
|
|
$
17,157
|
$
2,939
|
$
20,096
|
|
|
|
|
|
|
|
|
|
Net income per
share:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
$
0.19
|
|
$
0.32
|
|
$
0.76
|
|
$
0.89
|
Discontinued operations
|
|
-
|
|
-
|
|
-
|
|
-
|
Basic net
income per share
|
|
$
0.19
|
|
$
0.32
|
|
$
0.76
|
|
$
0.89
|
Diluted
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
$
0.18
|
|
$
0.31
|
|
$
0.75
|
|
$
0.87
|
Discontinued operations
|
|
-
|
|
-
|
|
-
|
|
-
|
Diluted net
income per share
|
|
$
0.18
|
|
$
0.31
|
|
$
0.75
|
|
$
0.87
|
|
|
|
|
|
|
|
|
|
Shares used in the
calculation of net income per share:
|
|
|
|
|
|
|
|
|
Weighted
average common shares outstanding - basic
|
|
22,695
|
|
22,695
|
|
22,663
|
|
22,663
|
Weighted
average common shares outstanding - diluted
|
|
23,044
|
|
23,044
|
|
23,021
|
|
23,021
|
|
|
|
|
|
|
|
|
|
(1)
|
To exclude the effect
of a one-time non-cash charge of $2.9 million in the three and nine
months ended December 31, 2017 due to a reduction in deferred tax
assets as a result of the TCJA enacted on December 22,
2017.
|
View original
content:http://www.prnewswire.com/news-releases/abaxis-reports-financial-performance-for-the-third-quarter-of-fiscal-2018-and-declares-quarterly-cash-dividend-300588102.html
SOURCE Abaxis, Inc.