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Myriad Genetics (MYGN)
Q1 2014 Earnings Call
November 05, 2013 4:30 pm ET
Peter D. Meldrum - Chief Executive Officer, President and Director
Mark Christopher Capone - President of Myriad Genetic Laboratories Inc
James S. Evans - Chief Financial Officer, Principal Accounting Officer and Treasurer
Tycho W. Peterson - JP Morgan Chase & Co, Research Division
Sung Ji Nam - Cantor Fitzgerald & Co., Research Division
William R. Quirk - Piper Jaffray Companies, Research Division
Douglas Schenkel - Cowen and Company, LLC, Research Division
Isaac Ro - Goldman Sachs Group Inc., Research Division
Amanda Murphy - William Blair & Company L.L.C., Research Division
Derik De Bruin - BofA Merrill Lynch, Research Division
Previous Statements by MYGN
» Myriad Genetics Management Discusses Q4 2013 Results - Earnings Call Transcript
» Myriad Genetics' CEO Hosts Annual Day (Transcript)
» Myriad Genetics Management Discusses Q3 2013 Results - Earnings Call Transcript
Thanks, Mike. Good afternoon, everyone, and welcome to the Myriad Genetics First Quarter Fiscal Year 2014 Earnings Call. My name is Scott Gleason, VP of Investor Relations here at Myriad Genetics. During the call, we will review the financial results we released today. After which, we will host a question-and-answer session. If you have not had a chance to review the earnings release, it can be found on the Investor Relations section of our website at myriad.com. Presenting today for Myriad will be Pete Meldrum, President and Chief Executive Officer; Mark Capone, President Myriad Genetics Laboratories; and Jim Evans, our Chief Financial Officer. This call can be heard live via webcast at myriad.com. The call is being recorded and will be archived in the Investor section of our website. Please note that some of the information presented here today may contain projections or other forward-looking statements regarding future events or the future financial performance of the company. These statements are based on management's current expectations, and the actual events or results may differ materially and adversely from these expectations for a variety of reasons. We refer you to the documents the company files from time to time with the Securities and Exchange Commission, specifically the company's Annual Report on Form 10-K, its quarterly reports on Form 10-Q and current reports on Form 8-K. These documents identify important risk factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements. With that, I'll now turn the call over to Pete.
Peter D. Meldrum
Thank you, Scott. To begin, I am pleased to provide highlights of our first quarter results. The revenues for the first quarter of our 2014 fiscal year increased 52% year-over-year to a record $202 million. As expected, we benefited from increased publicity during the quarter. However, even with that benefit, first quarter revenues rose 25% compared to the same period in the prior fiscal year, representing continued strong growth in our core markets.
Every one of our products contributed to this excellent performance, and I am pleased to note that our international division made excellent progress, with revenues increasing 125% year-over-year. Our investments and efforts in Europe are paying dividends, and looking ahead, we see 2 potential major catalysts in this market. First is the European approval of AstraZeneca's PARP inhibitor, which represents a $100 million companion diagnostic market opportunity. The second catalyst is the European launch of Myriad myRisk Hereditary Cancer test, which will occur during the second half of this fiscal year. Net income for the first fiscal quarter was $55 million, compared to $30 million in the same quarter of the prior fiscal year, an increase of 84%.
Finally, diluted earnings per share grew 89% to $0.68, compared to $0.37 in the first fiscal quarter of 2013.
Given these strong results, I am pleased to increase our financial guidance for fiscal year 2014. We are now projecting revenues of $700 million to $715 million, representing 14% to 17% growth, and earnings per share of $1.92 to $1.97, representing 9% to 12% growth. These results speak to the dedication of the Myriad team, and I'm especially proud of the hard work and diligent efforts of each one of our employees for delivering this excellent performance in the face of new direct competition. The company has aggressively repurchased its stock and has recently exhausted the current board repurchase authorization. To date, we have repurchased $700 million worth of Myriad's stock, representing over 30% of the company. We are committed to this long-standing policy of returning cash to the shareholders. And so I am pleased to announce that the board has approved a new stock buyback authorization of $300 million. This brings our total share repurchase authorizations to $1 billion. We will continue to build on these strong results by executing on our 3 major strategic directives of growing our existing markets, expanding internationally and launching new innovative products. Underlying these strategic directives is our commitment to improving patient health care through the development of transformative molecular diagnostic tests across multiple medical specialties, which address pressing clinical needs. We are also committed to reducing cost in the health care system by providing patients and their physicians with critical information to assess risk of disease, accurately diagnose disease, guide treatment decisions and predict disease recurrence. Myriad is making substantial progress in the field of PARP inhibitors, and collaboration with our pharmaceutical partners are ramping up in terms of activity. Myriad recently expanded its companion diagnostic agreement with AstraZeneca on olaparib, a novel PARP inhibitor. On September 30, the European medicines agency, which is equivalent to our FDA, accepted AstraZeneca's market authorization application for olaparib as a treatment for BRCA positive patients on ovarian cancer. Olaparib has a potential of being the first commercially available PARP inhibitor, and may be on the market in Europe as early as January 2015. Additionally, in October, the FDA granted orphan drug status for olaparib. We also recently announced that BioMarin Pharmaceuticals will use our BRACAnalysis test for their pivotal Phase III clinical study for BMN 673, an orally active PARP inhibitor. The BioMarin PARP inhibitor has exhibited strong potency, possibly due to its ability of trapping PARP onto the DNA, which is lethal to cancer cells. As required by the FDA, Myriad has submitted an Investigational Device Exemption, or IDE, for BRACAnalysis that will allow it to be used as a companion diagnostic to stratify breast cancer patients for BioMarin's Phase III studies.