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Myriad Genetics, Inc. (MYGN)
F2Q 2014 Earnings Conference Call
February 4, 2014 04:30 p.m. ET
Scott Gleason - VP, Investor Relations
Peter D. Meldrum - President and Chief Executive Officer
Mark C. Capone - President, Myriad Genetic Laboratories
James S. Evans - Chief Financial Officer
William Hagstrom - President and Chief Executive Officer of Crescendo Bioscience
Bill Quirk - Piper Jaffray
Amanda Murphy - William Blair
Drew Jones - Stephens
Sun Ji Nam - Cantor
Isaac Ro - Goldman Sachs
Shannon - RBC Capital Markets
Dan Leonard - Leerink Swann
Previous Statements by MYGN
» Q2 2014 Myriad Genetics Inc Earnings Conference call (Webcast)
» Myriad Genetics Management Discusses Q1 2014 Results - Earnings Call Transcript
» Myriad Genetics Management Discusses Q4 2013 Results - Earnings Call Transcript
» Myriad Genetics' CEO Hosts Annual Day (Transcript)
I would now like to turn the call over to Scott Gleason, VP, Investor Relations. Please go ahead, sir.
Thank you, (Petra). Good afternoon everyone, and welcome to Myriad Genetics second quarter fiscal year 2014 earnings call. My name is Scott Gleason, Vice President of Investor Relations here at Myriad Genetics, Inc.
During the call, we will review the financial results we've released today, after which we will host a question-and-answer session. If you've not had a chance to review the earnings release, it can be found in the Investor Relations section of our website at www.myriad.com.
Presenting for Myriad today will be Pete Meldrum, President and Chief Executive Officer; Mark Capone, President, Myriad Genetic 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 its 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'd now like to turn the call over to Pete.
Peter D. Meldrum
Thank you, Scott. To begin the call, I am pleased to announce that Myriad will acquire Crescendo Bioscience for $270 million. Crescendo is a global leader in the autoimmune disease diagnostics area, with a very exciting rheumatoid arthritis product that accurately measures disease activity in RA patients.
We are fortunate to have Bill Hagstrom, President and CEO of Crescendo join us this afternoon. Bill will be providing an overview of Crescendo later on in the call.
I am also pleased to announce that Myriad delivered another exceptional quarter. Second quarter revenues rose to a record of $204 million, growing 37% year-over-year. All of our product groups experienced solid growth rates this quarter, reflecting continued strong demand from our physician and patient customers.
Net income was $50 million, an increase of 44% year-over-year, which resulted in earnings per share growth of 57% to $0.66 compared to $0.42 in the same period of last year.
Given these solid results, we are once again raising our financial guidance for fiscal year 2014. We are now projecting revenues of $740 million to $750 million, representing 21% to 22% growth, and earnings per share of $2.09 cents to $2.12, representing 18% to 20% growth. This guidance incorporates the impact of the Crescendo Bioscience acquisition, which we anticipate will close by the end of this fiscal year. Jim will provide more details surrounding our guidance later on in the call.
Today in my prepared remarks, I would like to highlight our strategic goals of continuing to deliver excellent performance and growing our business in the future. The first component of our strategy is well underway. As we are in the progress of transitioning and expanding our product portfolio to ensure that we maintain our current level of leadership position in the hereditary cancer testing market.
The second strategic initiative is to grow our business globally. We are seeing meaningful progress in the international market, and have a clear line of sight to several major growth catalysts.
Finally, we are at a point where our product pipeline will begin contributing meaningfully and will enable us to deliver and diversify our business over the coming years.
Let's look at each of these individual growth strategies in more detail beginning with the hereditary cancer market. As investors are aware we are in the process of transitioning our single cancer testing to myRisk, our new 25 gene hereditary cancer panel. I am pleased to announce that in the second fiscal quarter, myRisk generated $11.5 million in sales, representing approximately 6% of our total revenue. The initial reception for myRisk among key opinion leaders was extremely positive. And so we have commenced an expanded access launch to roll myRisk out to physicians across the country.
The myRisk test dramatically expands all of our barriers to entry. The analysis of 25 genes at Myriad's clinical accuracy is extremely difficult and complex for competitors to duplicate. Additionally, Myriad is able to leverage the economies of scale associated with our large testing volumes combined with decades of expertise and laboratory informatics and engineering to deliver myRisk at a price that is comparable to single cancer testing. We are also able to provide these results with a turnaround time and volume of less than two weeks, which is essential for cancer patients where the test may guide surgical decisions.