GNMK GenMark Diagnostics Inc

Third Quarter Revenue of $8.5 Million, Up 34% Versus Prior YearXT-8 Installed Base Expanded by 25 to 616European ePlex™ Launch Now Expected in the First Quarter of 2016External ePlex Studies Recently Commenced at the First Customer Site

GenMark Diagnostics, Inc. (Nasdaq:GNMK), a leading provider of automated, multiplex molecular diagnostic testing systems, today reported third quarter 2015 financial results.

Revenue for the third quarter of 2015 was $8.5 million, an increase of 34% over the prior year period. During the quarter, 25 additional XT-8 analyzers were placed in end-user laboratories, resulting in a total installed base of 616 analyzers within the U.S. market.

Gross profit for the third quarter was $5.1 million, or 60% of revenue, compared with $3.7 million, or 59% of revenue in the same period of 2014.

“We are pleased with the continued strong performance of our XT-8 business and the progress we are making towards the European launch of our ePlex sample-to-answer system in the first quarter of 2016,” said Hany Massarany, President and Chief Executive Officer of GenMark. “We recently commenced external ePlex Alpha studies at the first customer site. We also tested numerous clinical samples on the ePlex system at GenMark and will be presenting results from these studies at The Association of Molecular Pathology Conference in Texas next week,” added Massarany.

Operating expenses for the third quarter of 2015 were $16.2 million compared to $14.0 million in the same period of 2014. The 16% increase was mainly driven by personnel related expenses across the organization as the Company prepares for the upcoming launch of the ePlex system.

Loss per share was $0.27 per share for the third quarter of 2015 compared to a loss of $0.23 per share in the same period of 2014.

The Company ended the quarter with $54.2 million in cash and cash equivalents and intends to continue utilizing its cash balances to invest in the global commercialization of the ePlex system.

Business Outlook

For full year 2015, the Company continues to expect revenue in the range of $38 to $40 million and gross margin of 57% to 59%. The Company now expects to place more than 90 XT-8 analyzers for the full year.

The Company will be hosting a conference call to discuss third quarter 2015 results in further detail on Tuesday, October 27, 2015 starting at 4:30 p.m. Eastern Time. The conference call will be concurrently webcast. The link to the webcast will be available on the GenMark Diagnostics, Inc. website at www.genmarkdx.com under the investor relations section and will be archived for future reference. To listen to the conference call, please dial (877) 312-5847 (US/Canada) or (253) 237-1154 (International) and use the conference ID number 62237999 approximately five minutes prior to the start time.

ABOUT GENMARK DIAGNOSTICS

GenMark Diagnostics (NASDAQ: GNMK) is a leading provider of automated, multiplex molecular diagnostic testing systems that detect and measure DNA and RNA targets to diagnose disease and optimize patient treatment. Utilizing GenMark’s proprietary eSensor® detection technology, GenMark’s eSensor XT-8TM system is designed to support a broad range of molecular diagnostic tests with a compact, easy-to-use workstation and self-contained, disposable test cartridges. The eSensor detection technology is also incorporated into GenMark’s sample-to-answer system, ePlexTM. For more information, visit www.genmarkdx.com.

SAFE HARBOR STATEMENT

This press release includes forward-looking statements regarding events, trends and business prospects, which may affect our future operating results and financial position. Such statements, including, but not limited to, those regarding the timely commercialization of our ePlex system and our future financial performance, are all subject to risks and uncertainties that could cause our actual results and financial position to differ materially. Some of these risks and uncertainties include, but are not limited to, our ability to successfully commercialize our ePlex system and its related test menu in a timely manner, constraints or inefficiencies caused by unanticipated acceleration and deceleration of customer demand, our ability to successfully expand sales of our product offerings outside the United States, and third-party payor reimbursement to our customers, as well as other risks and uncertainties described under the “Risk Factors” in our public filings with the Securities and Exchange Commission. We assume no responsibility to update or revise any forward-looking statements to reflect events, trends or circumstances after the date they are made.

    GENMARK DIAGNOSTICS, INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except par value)   September 30, 2015 December 31, 2014 Current assets Cash and cash equivalents $ 34,212 $ 36,855 Marketable securities 19,966 33,651 Accounts receivable, net of allowances of $2,702 and $2,702, respectively 4,332 4,889 Inventories 2,714 2,137 Prepaid expenses and other current assets 874 575 Total current assets 62,098 78,107 Property and equipment, net 11,557 11,052 Intangible assets, net 2,470 1,870 Restricted cash 758 758 Other long-term assets 184 183 Total assets $ 77,067 $ 91,970 Current liabilities Accounts payable $ 4,893 $ 5,126 Accrued compensation 4,885 5,172 Other current liabilities 1,695 1,995 Total current liabilities 11,473 12,293 Long-term liabilities Deferred rent 1,308 1,445 Long-term debt 9,794 — Other non-current liabilities 249 208 Total liabilities 22,824 13,946 Stockholders’ equity Preferred stock, $0.0001 par value; 5,000 authorized, none issued — — Common stock, $0.0001 par value; 100,000 authorized; 42,445 and 41,859 shares issued and outstanding as of September 30, 2015 and December 31, 2014, respectively 4 4 Additional paid-in capital 350,124 340,502 Accumulated deficit (295,887) (262,472) Accumulated other comprehensive income 2 (10) Total stockholders’ equity 54,243 78,024 Total liabilities and stockholders’ equity $ 77,067 $ 91,970         GENMARK DIAGNOSTICS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (In thousands, except per share data)   Three Months Ended Nine Months Ended September 30, September 30, 2015     2014 2015     2014 Revenue Product revenue $ 8,382 $ 6,233 $ 25,944 $ 20,593 License and other revenue 90 67 281 175 Total revenue 8,472 6,300 26,225 20,768 Cost of revenue 3,352 2,609 10,630 9,300 Gross profit 5,120 3,691 15,595 11,468 Operating expenses Sales and marketing 3,587 3,159 10,984 9,516 General and administrative 3,061 2,900 10,393 9,051 Research and development 9,589 7,904 27,292 23,297 Total operating expenses 16,237 13,963 48,669 41,864 Loss from operations (11,117) (10,272) (33,074) (30,396) Other income (expense) Interest income 30 45 99 206 Interest expense (289) (14) (607) (18) Other income (expense) (14) (33) 193 (34) Total other income (expense) (273) (2) (315) 154 Loss before provision for income taxes (11,390) (10,274) (33,389) (30,242) Income tax expense (benefit) 4 (616) 26 (591) Net loss $ (11,394) $ (9,658) $ (33,415) $ (29,651) Net loss per share, basic and diluted $ (0.27) $ (0.23) $ (0.79) $ (0.72) Weighted average number of shares outstanding, basic and diluted 42,312 41,446 42,061 41,273 Other comprehensive loss Net loss $ (11,394) $ (9,658) $ (33,415) $ (29,651) Foreign currency translation adjustments (1) — 8 — Net unrealized gains (losses) on marketable securities, net of tax (4) (3) (20) 6 Comprehensive loss $ (11,399) $ (9,661) $ (33,427) $ (29,645)     GENMARK DIAGNOSTICS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands)   Nine Months Ended September 30, 2015   2014 Operating activities Net loss $ (33,415) $ (29,651) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 2,500 1,870 Amortization of premiums on investments 157 577 Amortization of deferred debt issuance costs 199 — Gain on sale of investment in preferred stock (223) — Stock-based compensation 7,347 4,478 Non-cash inventory adjustments 567 517 Other non-cash adjustments 9 — Changes in operating assets and liabilities: Accounts receivable 557 151 Inventories (980) 209 Prepaid expenses and other assets (320) (691) Accounts payable (358) (318) Accrued compensation 575 1,757 Other liabilities (295) (1,131) Net cash used in operating activities (23,680) (22,232) Investing activities Payments for intellectual property licenses (550) (350) Purchases of property and equipment (2,868) (3,699) Purchases of marketable securities (14,797) (28,054) Proceeds from sales of marketable securities 223 7,497 Maturities of marketable securities 28,350 36,250 Net cash provided by investing activities 10,358 11,644 Financing activities Proceeds from issuance of common stock 427 373 Principal repayment of borrowings (15) (51) Proceeds from borrowings 10,000 — Costs associated with debt issuance (718) — Proceeds from stock option exercises 986 201 Net cash provided by financing activities 10,680 523 Effect of exchange rate changes on cash (1) — Net decrease in cash and cash equivalents (2,643) (10,065) Cash and cash equivalents at beginning of period 36,855 35,723 Cash and cash equivalents at end of period $ 34,212 $ 25,658 Non-cash investing and financing activities Transfer of instruments from property and equipment to inventory $ 165 $ 156 Property and equipment costs included in accounts payable $ 248 $ 364 Intellectual property acquisitions included in other current liabilities $ 800 $ 550 Supplemental cash flow disclosures Cash paid for income taxes, net $ 9 $ 27 Cash received for interest $ 256 $ 783 Cash paid for interest $ 607 $ 18

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GenMark Diagnostics, Inc.Hany MassaranyPresident/Chief Executive Officer760-448-4325