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Luminex Corporation (LMNX)
Q4 2009 Earnings Call
February 04, 2010; 05:00 pm ET
Pat Balthrop - President and CEO
Harriss Currie - CFO
Mimi Torrington - Director of IR
Daniel Owczarski - Avondale Partners
Stephen Simpson - Northland Securities
Dan Leonard - First Analysis
Matthew Scalo - Canaccord Adams
Brian Weinstein - William Blair
Dana Walker - Kalmar Investments
Jim Stafford -Wells Fargo
Previous Statements by LMNX
» Luminex Corporation Q3 2009 Earnings Call Transcript
» Luminex Corporation Q1 2009 Earnings Call Transcript
» Luminex Corporation Q4 2008 Earnings Call Transcript
Thank you, Regina. Good afternoon and welcome to Luminex Corporation’s conference call for the fourth quarter and full year 2009 financial and operational results. During the call we will review our financial results released today after the close of the market. Today, Pat Balthrop, our President and Chief Executive Officer; and Harriss Currie, our Chief Financial Officer will discuss our fourth quarter and full year results highlights as well as the outlook and annual revenue guidance for 2010. Following our prepared remarks, we will have time to take your questions.
In addition to the audio portion of our conference call, we have prepared slide presentation that is available on our website at www.luminexcorp.com. To access this presentation, click on the company tab, access the Investor Relations link and then click on the live conference call link. Our presentation will be available on our website for six months.
I’d like to take this opportunity to remind you that certain statements made during the course of this presentation may not be purely historical and consequently maybe forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements speak only as of the date hereof and are based on our current beliefs and expectations and are subject to known or unknown risks and uncertainties, some of which are beyond the company’s control, that could cause actual results or plans to differ materially and adversely from those anticipated in the forward-looking statements.
Factors that could cause or contribute to such differences are detailed in our Form 10-K for the year ended December 31, 2008 and our Quarterly Reports on Form 10-Q for subsequent periods filed with the Securities and Exchange Commission. We encourage you to review these documents and the cautionary language we have included at the beginning of the slide presentation we are presenting today. We undertake no obligation to update these forward-looking statements.
Also certain non-GAAP financial measures as defined by SEC Regulation G may be covered in this presentation. To the extent that any non-GAAP financial measures are covered, a presentation of and reconciliation to the most directly comparable GAAP financial measures will be included in this presentation and/or available on our website at www.luminexcorp.com in accordance with Regulation G.
I’ll now turn the call over to Pat Balthrop, President and Chief Executive Officer of Luminex.
Thank you, Mimi. Welcome to our fourth quarter and full year 2009 earnings conference call. We’ll take 20 or 30 minutes to review our presentation and then take your questions. I’ll summarize the operating highlights and outlook for 2010, Harriss will read the financial data and then I’ll address the 2010 revenue guidance before we open the call for your questions.
Let me began by stating how pleased we are with our quarter and our year end results. We delivered 35% revenue growth for the quarter and 16% for the year. Under the market conditions that the industry faced in 2009, we’re very proud to deliver growth rates based on the data that we have seen appeared to be the highest in the industry and among our peers.
We delivered revenue growth in capital equipment sales and set a capital revenue record for the company in the tightest capital equipment market conditions in at least 30 years. Our quarterly instruments shipments were above our historical range at 253 and our cumulative instrument shipments now stands at 6767, the numbers that is many times the install base of any competitive multiplexing platform.
In 2009, we incurred some unique challenges and opportunity. One of these was the H1N1 outbreak and the resulting demand for our unique or RVP assay that in turn led to a record assay sales in the quarter of $12.9 million, more than double the prior year period. But in case you proceed with this RVP alone included in this reagent sales number is growth contributed by our other assay products which include our cystic fibrosis line our Ashkenazi Jewish Genetic Panel and others.
Our consumables in bead revenue as we predicted on last quarter’s call return to growth in the fourth quarter at $8 million, our fourth highest bead revenue quarter ever. And our royalties continue to be an important growth driver for the company. Our gross margins continue to be in the high 60s, as we have forecasted at 67% for the quarter and for the year
Last quarter, we discussed our investor share anticipate the release of the tax valuation allowance during the fourth quarter, Harriss will review this in detail later. Excluding the valuation allowance effect, net income for the quarter was $5.2 million or an EPS of $0.13. Luminex is a growth story. We track several metrics regularly revenue for each of our major revenue line items, included here our total revenue growth, system revenue growth, consumable revenue growth, assay revenue growth and royalty revenue growth.
And end-user assay sales are now approaching $350 million annualized and growing at a compounded rate of 38%. This expansion along with a continually growing install base of instruments on which these assays can run provide the great indictor for future growth. The company has set a strategic target of maintaining our gross margins above the mid 60s and we continue to achieve that strategic goal. The strategy is been to invest in product lines and channels where this level of profitability will be achievable and we have continued to deliver against that objective.