GNMK GenMark Diagnostics Inc

First Quarter Revenue Increased 13% Versus Prior Year to $12.5 million

Over 70 ePlex® Customer Agreements in Place Totaling More than 100 Analyzers

ePlex Blood Culture Identification Fungal Pathogen Panel CE Mark Achieved

GenMark Diagnostics, Inc. (Nasdaq:GNMK), a leading provider of automated, multiplex molecular diagnostic testing systems, today announced financial results for the first quarter ended March 31, 2017.

Revenue for the first quarter of 2017 was $12.5 million, an increase of 13% over the prior year period. Annuity per XT-8 analyzer was $72 thousand in the first quarter and in the mid-$70 thousand range over the last 4 quarters.

Gross profit for the first quarter was $6.2 million, or 49% of revenue, compared with $6.7 million, or 60% of revenue in the same period of 2016.

“Customer experience with ePlex has confirmed its superior ease of use and workflow efficiency, compared with other systems on the market. We designed ePlex to seamlessly integrate the entire diagnostic process from test order entry to reporting patient results,” said Hany Massarany, President and Chief Executive Officer of GenMark. “Customers are also very positive about our efforts to expand the ePlex menu, including our three panel approach to sepsis testing. We recently achieved CE Mark for the Blood Culture ID Fungal Pathogen Panel and expect the Gram Positive and Gram Negative Pathogen Panels to follow suit this quarter. Additionally, our Regulatory and Clinical Affairs teams have been working very closely with the FDA on our 510(k) submissions for the ePlex instrument and RP Panel. We have closed out all the questions raised by the agency during its review process and expect FDA clearance soon,” added Massarany.

Operating expenses for the first quarter of 2017 were $19.7 million compared to $19.4 million in the same period for 2016. The increase was mainly driven by Marketing and Sales expenses as the Company continues to expand its commercial organization in support of the global ePlex product launch.

Loss per share was $0.30 per share for the first quarter of 2017, which was equal to the loss per share in the first quarter of 2016.

The Company ended the quarter with $24.2 million in cash and cash equivalents. The Company's existing debt facility can provide up to an additional $20 million to support the launch of ePlex internationally as well as domestically.

Business Outlook

For full year 2017, the Company continues to expect revenue in the range of $65 to $70 million and gross margin in the range of 48-52%.

The Company will be hosting a conference call to discuss first quarter results in further detail on Tuesday, May 2, 2017 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 51141106 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-8® 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, ePlex®. 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 our future financial performance, the timely commercialization and regulatory clearance of our ePlex system, and the availability of future financing, 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. CONSOLIDATED BALANCE SHEETS (In thousands, except par value)   March 31, 2017 December 31, 2016 Current assets Cash and cash equivalents $ 13,178 $ 15,959 Marketable securities 11,007 25,607 Accounts receivable, net of allowances of $2,749 and $2,740, respectively 7,487 9,048 Inventories 9,019 6,633 Prepaid expenses and other current assets 1,419   1,202   Total current assets 42,110 58,449 Non-current assets Property and equipment, net 18,482 18,268 Intangible assets, net 2,546 2,670 Restricted cash 758 758 Other long-term assets 179   179   Total assets $ 64,075   $ 80,324   Current liabilities Accounts payable $ 5,696 $ 8,703 Accrued compensation 4,510 5,650 Loan payable 7,685 7,935 Other current liabilities 3,159   4,133   Total current liabilities 21,050 26,421 Long-term liabilities Deferred rent 3,524 3,652 Long-term debt 12,261 11,880 Other non-current liabilities 186   220   Total liabilities 37,021   42,173   Stockholders’ equity Preferred stock, $0.0001 par value; 5,000 authorized, none issued — — Common stock, $0.0001 par value; 100,000 authorized; 47,084 and 46,554 shares issued and outstanding at March 31, 2017 and December 31, 2016, respectively 5 4 Additional paid-in capital 396,217 393,322 Accumulated deficit (369,188 ) (355,270 ) Accumulated other comprehensive income 20   95   Total stockholders’ equity 27,054   38,151   Total liabilities and stockholders’ equity $ 64,075   $ 80,324       GENMARK DIAGNOSTICS, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (In thousands, except per share data)   Three Months Ended March 31, 2017   2016 Revenue Product revenue $ 12,470 $ 10,959 License and other revenue 65 105 Total revenue 12,535 11,064 Cost of revenue 6,352   4,375   Gross profit 6,183 6,689 Operating expenses Sales and marketing 4,693 3,709 General and administrative 4,011 3,419 Research and development 11,035   12,269   Total operating expenses 19,739   19,397   Loss from operations (13,556 ) (12,708 ) Other income (expense) Interest income 52 29 Interest expense (507 ) (277 ) Other income 95   33   Total other expense (360 ) (215 ) Loss before provision for income taxes (13,916 ) (12,923 ) Income tax expense 1   35   Net loss $ (13,917 ) $ (12,958 ) Net loss per share, basic and diluted $ (0.30 ) $ (0.30 ) Weighted average number of shares outstanding, basic and diluted 46,846 42,672 Other comprehensive loss Net loss $ (13,917 ) $ (12,958 ) Foreign currency translation adjustments 91 47 Net unrealized losses on marketable securities, net of tax (16 ) (17 ) Comprehensive loss $ (13,842 ) $ (12,928 )     GENMARK DIAGNOSTICS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands)   Three Months Ended March 31, 2017   2016 Operating activities Net loss $ (13,917 ) $ (12,958 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 1,217 900 Amortization of premiums on investments 19 16 Amortization of deferred debt issuance costs 151 92 Stock-based compensation 2,808 2,402 Provision for bad debt 9 29 Non-cash inventory adjustments 317 75 Other non-cash adjustments (85 ) (49 ) Changes in operating assets and liabilities: Accounts receivable 1,558 1,385 Inventories (3,118 ) 501 Prepaid expenses and other assets (216 ) — Accounts payable (2,821 ) 617 Accrued compensation (1,144 ) 989 Other liabilities (343 ) (42 ) Net cash used in operating activities (15,565 ) (6,043 ) Investing activities Payments for intellectual property licenses — (800 ) Purchases of property and equipment (1,888 ) (966 ) Purchases of marketable securities 13,896 — Maturities of marketable securities 12,708   (1,766 ) Net cash provided by (used in) investing activities 13,896 (966 ) Financing activities Principal repayment of borrowings (6 ) (5 ) Proceeds from borrowings — — Costs associated with debt issuance (20 ) (10 ) Proceeds from stock option exercises 88   345   Net cash provided by financing activities 62   330   Effect of exchange rate changes on cash 14 7 Net decrease in cash and cash equivalents (2,781 ) (7,472 ) Cash and cash equivalents at beginning of period 15,959   35,385   Cash and cash equivalents at end of period $ 13,178   $ 27,913   Non-cash investing and financing activities Transfer of instruments from (to) property and equipment into inventory $ (415 ) $ 38 Property and equipment costs included in accounts payable $ 183 $ 285 Supplemental cash flow disclosures Cash paid for income taxes, net $ 5 $ 13 Cash received for interest $ 108 $ 21 Cash paid for interest $ 347 $ 184

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