MYGN

Myriad Genetics, Inc. (MYGN)

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Myriad Genetics (MYGN)

Q3 2014 Earnings Call

May 06, 2014 4:30 pm ET

Executives

Scott Gleason -

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

Analysts

William R. Quirk - Piper Jaffray Companies, Research Division

Derik De Bruin - BofA Merrill Lynch, Research Division

Eric Criscuolo - Mizuho Securities USA Inc., Research Division

Amanda Murphy - William Blair & Company L.L.C., Research Division

Sung Ji Nam - Cantor Fitzgerald & Co., Research Division

Daniel L. Leonard - Leerink Swann LLC, Research Division

Andrew L. Jones - Stephens Inc., Research Division

Isaac Ro - Goldman Sachs Group Inc., Research Division

Jonathan P. Groberg - Macquarie Research

Presentation

Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Myriad Genetics' third quarter 2014 financial earnings call. [Operator Instructions] As a reminder, this conference is being recorded, Tuesday, May 6, 2014. I'd now like to turn the conference over to Mr. Scott Gleason, VP of Investor Relations. Please go ahead, sir.

Scott Gleason

Thanks, Jamie. Good afternoon, everyone, and welcome to the Myriad Genetics' Third Quarter Fiscal Year 2014 Earnings Call. My name is Scott Gleason, Vice President of Investor Relations here at Myriad Genetics.

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 have not had a chance to review the earnings release, it can be found in the Investor Relations section of our website at myriad.com.

Presenting for Myriad today 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 Investors 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 the 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 report 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'll now turn the call over to Pete.

Peter D. Meldrum

Thank you, Scott. I'm pleased to announce that Myriad once again delivered double-digit top and bottom line growth this quarter. Third quarter revenues were $182.9 million, an increase of 17% year-over-year. Fully diluted earnings per share for the third quarter were $0.48, which included a one-time noncash charge associated with the acquisition of Crescendo Bioscience.

In order to facilitate a more complete analysis of the company's operating results and allow for comparison of results across historical reporting periods, we are providing additional information to investors that excludes the noncash acquisition expense. Therefore, our adjusted earnings per share for the third quarter were $0.60, an increase of 31% over the same quarter of the prior year.

Given our stronger-than-anticipated third quarter financial results, I am pleased to announce that we are once again increasing our financial guidance for the 2014 fiscal year. We are now projecting revenues of $770 million to $775 million, representing 20% -- 26% revenue growth over fiscal year 2013.

On the bottom line, we are projecting adjusted earnings per share of $2.37 to $2.40, representing 34% to 35% year-over-year growth. Jim will provide more details surrounding our financial guidance later on in the call.

I am very pleased with our strong financial performance in the third quarter, which supports our focus of growing and diversifying our business to achieve the goal of building a world-class leading molecular diagnostic company, providing exceptional patient care across all major diseases.

I will begin by focusing my remarks today on Myriad's efforts to advance our strategic initiatives of expanding our core hereditary cancer market, growing our international business and launching new life-saving products. We achieved a major milestone this quarter by signing a transformational payor contract with UnitedHealthcare for our myRisk Hereditary Cancer test. Mark will talk in more detail about the contract later on in the call, but we see this contract as a strong validation of the clinical importance of myRisk.

United is our second largest payor and is a leader in hereditary cancer testing and personalized medicine. This 3-year contract not only provides for myRisk coverage for all UnitedHealthcare members but also provides coverage for myRisk update testing for those patients who have been previously tested by one of Myriad's single cancer tests.

Our continued confidence in obtaining universal myRisk reimbursement stems from several key studies that we will be publishing over the coming months, including another clinical validation of myRisk, several clinical utility studies and the health economic model for myRisk. Armed with this extensive and persuasive data, we are optimistic that we will be announcing additional myRisk coverage decisions over the next few quarters.

I am also pleased to note that the Society of Gynecological Oncology recently updated their guidelines to include language highlighting the advantages of cancer gene panels. These advantages include a reduction in health care costs, an improvement in efficiency and an increase in sensitivity with a more informative test result.

Read the rest of this transcript for free on seekingalpha.com