Quidel Corporation (NASDAQ: QDEL), a provider of rapid
diagnostic testing solutions, cellular-based virology assays and
molecular diagnostic systems, announced today financial results for
the third quarter ended September 30, 2021.
Third Quarter 2021 Highlights
- Total revenues increased 7% to $509.7 million, from $476.1
million in the third quarter of 2020.
- Total sales of COVID-19 products increased 7% to $402.6
million, from $375.7 million in the third quarter of 2020.
- Total sales of Influenza products were $13.8 million, compared
to $9.0 million in the third quarter of 2020.
- Reported GAAP EPS of $5.08 per diluted share in the third
quarter of 2021, as compared to $5.33 per diluted share in the
third quarter of 2020.
- Reported non-GAAP EPS of $5.36 per diluted share in the third
quarter of 2021, as compared to $5.78 per diluted share in the
third quarter of 2020.
- Resolved ongoing litigation with Beckman Coulter; substantially
completed transition of the BNP business to Beckman Coulter for
cash payments to Quidel of between $70.0 million and $75.0 million
per year from 2022 through 2029, and pro-rated for 2021.
- Received the CE Mark for Savanna® multiplex molecular analyzer
and Savanna RVP4 assay.
- Made QuickVue® At-Home OTC COVID-19 Test available to consumers
at CVS Pharmacy and online at cvs.com.
- Secured 12-month agreement with U.S. government worth over $500
million to supply QuickVue At-Home OTC COVID-19 Tests.
Results for the Third Quarter 2021
Total revenues for the third quarter of 2021 were $509.7
million, versus $476.1 million for the third quarter of 2020. The
7% increase in sales from the third quarter of 2020 was driven by
increased sales of COVID-19 diagnostic tests, led by QuickVue
At-Home OTC COVID-19 Test, and strong sales of Sofia® SARS and
Lyra® PCR COVID-19 tests. Currency exchange rate impact for the
third quarter of 2021 was favorable by $1.0 million. Excluding
COVID-19 and influenza products, revenue for the core business
increased 2% to $93.3 million in the third quarter of 2021, as
compared to $91.4 million in the third quarter of 2020.
Rapid Immunoassay revenue increased by $41.7 million in the
third quarter of 2021 to $378.7 million, driven primarily by
continued demand for our Sofia SARS and QuickVue SARS antigen
assays. Cardiometabolic Immunoassay revenue totaled $64.8 million
in the third quarter of 2021, equal to the third quarter of 2020.
Molecular Diagnostic Solutions revenue decreased by $8.2 million to
$54.8 million, due to a $14.3 million decline in sales of Lyra PCR
assays for COVID-19 diagnosis that was partially offset by
incremental revenue from our Solana® SARS-CoV-2 assay. Specialized
Diagnostic Solutions revenue increased 2% from the third quarter of
2020 to $11.4 million, driven by increased MicroVue™ specialty
products.
“We delivered strong top-line growth in the third quarter of
2021, meeting increased demand for our SARS category products due
to the sudden increase in COVID-19 cases associated with the Delta
variant,” said Douglas Bryant, President and CEO of Quidel. While
we are pleased to see COVID-19 cases trending down, we still see
the need for symptomatic and asymptomatic testing and anticipate
that a baseline level of demand will continue into early 2022. Our
expectations are bolstered by consumer, corporate and institutional
purchasing and the 12-month agreement to supply over $500 million
in QuickVue At-Home OTC COVID-19 Tests to the federal
government.”
Mr. Bryant added, “From a production capacity perspective, we
continue to build toward our planned capacity goals for our
QuickVue and Sofia diagnostic tests to support our institutional
and government partnerships, and further promote rapid testing to
minimize the spread of COVID-19 within our communities. In that
regard, I am particularly proud of our work with charitable and
sports organizations to democratize access to testing in minority
and underserved communities that have been hardest-hit by COVID-19
infections. Quidel is committed to expanding these efforts as we
scale.”
Mr. Bryant continued, “In addition to our commercial success, I
am incredibly pleased with the progress we’ve made on our R&D
projects during the quarter as we execute on our multi-faceted,
long-term growth strategy. In the quarter, we achieved a notable
milestone in obtaining CE Mark for our Savanna platform and
resolved a critical component shortage issue, and we are planning
to launch the Savanna platform in select markets outside the U.S.
These developments, when combined with our global strategic
partnerships to increase brand awareness and expand access to high
quality, affordable diagnostic testing, make Quidel exceptionally
well-prepared to continue driving growth across our multiple
platforms and channels.”
Mr. Bryant concluded, “I would like to thank all our teams for
their unrelenting commitment to overcoming operational challenges
and making impressive progress against our growth roadmap. We are
excited about the opportunities that lie ahead as we continue to
advance our diagnostics portfolio and position Quidel for long-term
growth.”
Gross profit was $373.4 million, or 73% of revenue for the three
months ended September 30, 2021, compared to $383.6 million, or 81%
of revenue for the three months ended September 30, 2020. The
decreased gross profit was driven by lower selling prices for our
SARS products and a shift in product mix from Sofia to QuickVue
COVID-19 diagnostic products. Increases in supply chain and other
indirect manufacturing costs also contributed to lower gross profit
in the current period. Gross margin for the three months ended
September 30, 2021 declined as compared to the same period in the
prior year due to the same factors. R&D expense increased by
$2.2 million in the third quarter of 2021 as compared to the same
period last year, primarily due to increased spending on Savanna
instrument and cartridge development in support of U.S. clinical
trials. Sales and marketing expense increased by $9.4 million in
the third quarter of 2021 as compared to the same period last year,
primarily due to higher product promotional spend associated with
the launch of our QuickVue At-Home OTC COVID-19 Test, as well as
increased freight expense and higher compensation costs driven by
increased headcount and improved performance in the quarter.
G&A expense increased by $4.7 million in the third quarter of
2021 as compared to the same period last year due to increased
spend on IT projects and higher compensation costs driven by
increased headcount to support the growth of the business.
In the third quarter of 2021, Quidel recorded an income tax
expense of $65.7 million, as compared to $63.5 million in the same
quarter of the prior year. The higher tax expense for the three
months ended September 30, 2021 compared to the same period in the
prior year is primarily a result of an increase in state taxes owed
and a decrease in stock-based compensation proportionate to pre-tax
profits.
Net income for the third quarter of 2021 was $215.8 million, or
$5.08 per diluted share, as compared to net income of $232.3
million, or $5.33 per diluted share, for the third quarter of 2020.
On a non-GAAP basis, net income for the third quarter of 2021 was
$227.7 million, or $5.36 per diluted share, as compared to net
income of $252.0 million, or $5.78 per diluted share, for the same
period in 2020.
Results for the Nine Months Ended September 30, 2021
Total revenues for the nine months ended September 30, 2021 were
$1,061.7 million, versus $852.5 million for the nine months ended
September 30, 2020. The 25% increase in sales from the nine months
ended September 30, 2020 was driven by growth in Rapid Immunoassay
and Molecular Diagnostic Solutions product categories as a result
of relatively strong demand for both rapid antigen and PCR COVID-19
tests in 2021 versus the same period in 2020. Revenue growth in the
first nine months of 2021 also came from Cardiometabolic
Immunoassay products, the revenue of which increased 17% compared
to the same period in 2020. Specialized Diagnostic Solutions
revenue decreased 17% from the nine months ended September 30,
2020, driven primarily by a decline in demand for cell culture
respiratory products. Currency exchange rate impact for the nine
months ended September 30, 2021 was favorable by $5.9 million .
Excluding COVID-19 and influenza products, revenue for the core
business increased 6% to $274.7 million for the nine months ended
September 30, 2021, as compared to $259.5 million for the nine
months ended September 30, 2020.
Gross profit increased to $781.6 million, or 74% of revenue for
the nine months ended September 30, 2021, compared to $647.4
million, or 76% of revenue for the nine months ended September 30,
2020. The increased gross profit was due to higher sales volumes in
the current period, partially offset by unfavorable product mix,
lower selling prices for our SARS products and increased supply
chain and other indirect manufacturing costs. Gross margin for the
nine months ended September 30, 2021 declined as compared to the
same period in the prior year driven primarily by product mix and
lower selling prices. R&D expense increased by $10.8 million in
the nine months ended September 30, 2021 as compared to the same
period last year, primarily due to increased spending on the
Savanna system and clinical trials. Sales and marketing expense
increased by $23.4 million in the nine months ended September 30,
2021 as compared to the same period in 2020, primarily due to
higher product promotional spend associated with the launch of the
QuickVue At-Home OTC COVID-19 Test, higher compensation costs
driven by increased headcount and increased revenue. G&A
expense increased by $15.3 million in the nine months ended
September 30, 2021 as compared to the same period last year due to
increased spend on IT projects and higher compensation costs driven
by increased headcount to support the growth of the business.
Acquisition and integration costs of $1.8 million and $3.2 million
for the nine months ended September 30, 2021 and 2020,
respectively, primarily related to the evaluation of new business
development opportunities.
For the nine months ended September 30, 2021, Quidel recorded an
income tax expense of $112.1 million, as compared to $84.6 million
in the same period last year. The higher tax expense for the nine
months ended September 30, 2021 compared to the same period in the
prior year is a result of an increase in state taxes owed and a
decrease in tax deductions from stock-based compensation
proportionate to pre-tax profits.
Net income for the nine months ended September 30, 2021 was
$412.9 million, or $9.72 per diluted share, as compared to net
income of $340.2 million, or $7.82 per diluted share, for the nine
months ended September 30, 2020. On a non-GAAP basis, net income
for the nine months ended September 30, 2021 was $450.4 million, or
$10.60 per diluted share, as compared to net income of $385.6
million, or $8.85 per diluted share, for the same period in
2020.
Non-GAAP Financial Information
Quidel is providing non-GAAP financial information to exclude
the effect of stock-based compensation, amortization of
intangibles, non-cash interest expense, foreign exchange gains and
losses and certain non-recurring items on net income and earnings
per share as a supplement to its consolidated financial statements,
which are presented in accordance with generally accepted
accounting principles in the U.S., or GAAP.
Quidel is providing the adjusted gross profit, adjusted
operating income, adjusted net income, adjusted net earnings per
share, and constant currency revenue information for the periods
presented because it believes these non-GAAP financial measures
enhance the comparison of Quidel’s financial results from
period-to-period and to that of its competitors. Constant currency
revenue is calculated by (i) translating current period revenues
using prior period exchange rates and (ii) excluding any hedging
effect recognized in the current period. The related constant
currency fluctuation rate (expressed as a percentage) is calculated
by determining the change in current period constant currency
revenue compared to prior period revenue.
This press release is not meant to be considered in isolation,
or as a substitute for results prepared in accordance with GAAP. A
reconciliation of the non-GAAP financial measures to the comparable
GAAP measures is included in this press release as part of the
attached financial tables.
Conference Call Information
Quidel management will host a conference call to discuss the
third quarter 2021 results, as well as other business matters,
today beginning at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time).
During the conference call, management may answer questions
concerning business and financial developments and trends. Quidel’s
responses to these questions, as well as other matters discussed
during the conference call, may contain or constitute material
information that has not been previously disclosed.
To join the live webcast, participants may click the following
link directly:
https://event.on24.com/wcc/r/3485847/878757FED3288D2F3FBAF8E692AD65DE,
or access the event via the Investor Relations section of the
Quidel website (http://ir.quidel.com).
The website replay will be available for one year. The telephone
replay will be available for 14 days beginning at 8:00 p.m. Eastern
Time (5:00 p.m. Pacific Time) on November 4, 2021 by dialing
929-458-6194 from the U.S., or by dialing +44-204-525-0658 for
international callers, and entering pass code 095213.
About Quidel Corporation
Quidel Corporation (Nasdaq: QDEL) is a leading manufacturer of
diagnostic solutions at the point of care, delivering a continuum
of rapid testing technologies that further improve the quality of
health care throughout the globe. An innovator for over 40 years in
the medical device industry, Quidel pioneered the first FDA-cleared
point-of-care test for influenza in 1999 and was the first to
market a rapid SARS-CoV-2 antigen test in the U.S. Under trusted
brand names Sofia, Solana, Lyra, Triage® and QuickVue, Quidel’s
comprehensive product portfolio includes tests for a wide range of
infectious diseases, cardiac and autoimmune biomarkers, as well as
a host of products to detect COVID-19. With products made in
America, Quidel’s mission is to provide patients with immediate and
frequent access to highly accurate, affordable testing for the good
of our families, our communities and the world. For more
information about Quidel, visit quidel.com.
View our story told by our people at
www.quidel.com/ourstory.
Forward-looking Statements
This press release contains forward-looking statements that
involve material risks, assumptions, and uncertainties.
Forward-looking statements typically contain terms such as “may,”
“will,” “should,” “might,” “expect,” “anticipate,” “estimate,”
“plan,” “intend,” “goal,” “project,” “strategy,” “future,” and
similar words. Various factors could cause our actual results and
performance to differ materially from the forward-looking
statements. Factors that could contribute to such differences
include: impacts of the COVID-19 pandemic; competition; our
development of new technologies, products, and markets; our
reliance on sales of our COVID-19 and influenza diagnostic tests;
our reliance on a limited number of key distributors; acceptance of
our products among physicians, healthcare providers, or other
customers; the impact of third-party reimbursement policies; our
ability to meet demand for our products; interruptions in our
supply of raw materials and other components; costs and disruptions
from failures in our information technology and storage systems;
international risks, including compliance with product registration
requirements and legal requirements, tariffs, currency exchange
fluctuations, reduced protection of intellectual property rights,
and taxes; worldwide economic, political, and social uncertainty;
our development, acquisition, and protection of proprietary
technology rights; intellectual property risks and third-party
claims of infringement; loss of our Emergency Use Authorization
from the U.S. Food and Drug Administration for our COVID-19
products; failures or delays in receiving regulatory approvals,
clearances, or authorizations, the loss of previously received
approvals, or other adverse actions by regulatory authorities;
performance, timing, funding and compliance risks relating to
government contracts; product defects; compliance with government
regulations relating to the handling, storage, and disposal of
hazardous substances; our ability to identify and successfully
acquire and integrate potential acquisition targets; our need for
additional funds to finance our capital or operating needs; and
other risks described in our periodic reports and registration
statements filed with the Securities and Exchange Commission.
Except as required by law, we undertake no obligation to update
these forward-looking statements for revisions or changes after the
date of this press release.
QUIDEL CORPORATION
(In thousands, except per share
data; unaudited)
Three months ended September
30,
Consolidated Statements of
Operations:
2021
2020
Total revenues
$
509,736
$
476,058
Cost of sales
136,328
92,439
Gross profit
373,408
383,619
Research and development
23,676
21,448
Sales and marketing
46,778
37,413
General and administrative
21,113
16,410
Acquisition and integration costs
—
389
Total operating expenses
91,567
75,660
Operating income
281,841
307,959
Other expense, net
Interest and other expense, net
(347
)
(1,797
)
Loss on extinguishment of debt
—
(10,384
)
Total other expense, net
(347
)
(12,181
)
Income before income taxes
281,494
295,778
Provision for income taxes
65,742
63,510
Net income
$
215,752
$
232,268
Basic earnings per share
$
5.17
$
5.52
Diluted earnings per share
$
5.08
$
5.33
Shares used in basic per share
calculation
41,728
42,105
Shares used in diluted per share
calculation
42,463
43,596
Gross profit as a % of total revenues
73
%
81
%
Research and development as a % of total
revenues
5
%
5
%
Sales and marketing as a % of total
revenues
9
%
8
%
General and administrative as a % of total
revenues
4
%
3
%
Consolidated net revenues by product
category are as follows:
Rapid Immunoassay
$
378,721
$
337,042
Cardiometabolic Immunoassay
64,790
64,810
Molecular Diagnostic Solutions
54,834
62,993
Specialized Diagnostic Solutions
11,391
11,213
Total revenues
$
509,736
$
476,058
Condensed balance sheet data:
9/30/2021
12/31/2020
Cash and cash equivalents
$
578,447
$
489,941
Accounts receivable, net
$
335,560
$
497,688
Inventories
$
196,976
$
113,798
Total assets
$
2,106,382
$
1,871,164
Short-term debt
$
272
$
238
Long-term debt
$
431
$
4,100
Stockholders’ equity
$
1,634,067
$
1,332,703
QUIDEL CORPORATION
(In thousands, except per share
data; unaudited)
Nine months ended September
30,
Consolidated Statements of
Operations:
2021
2020
Total revenues
$
1,061,684
$
852,465
Cost of sales
280,131
205,104
Gross profit
781,553
647,361
Research and development
69,594
58,797
Sales and marketing
119,111
95,718
General and administrative
61,758
46,421
Acquisition and integration costs
1,754
3,175
Total operating expenses
252,217
204,111
Operating income
529,336
443,250
Other expense, net
Interest and other expense, net
(4,352
)
(8,071
)
Loss on extinguishment of debt
—
(10,384
)
Total other expense, net
(4,352
)
(18,455
)
Income before income taxes
524,984
424,795
Provision for income taxes
112,075
84,638
Net income
$
412,909
$
340,157
Basic earnings per share
$
9.91
$
8.08
Diluted earnings per share
$
9.72
$
7.82
Shares used in basic per share
calculation
41,657
42,093
Shares used in diluted per share
calculation
42,471
43,582
Gross profit as a % of total revenues
74
%
76
%
Research and development as a % of total
revenues
7
%
7
%
Sales and marketing as a % of total
revenues
11
%
11
%
General and administrative as a % of total
revenues
6
%
5
%
Consolidated net revenues by product
category are as follows:
Rapid Immunoassay
$
676,461
$
513,578
Cardiometabolic Immunoassay
203,008
172,902
Molecular Diagnostic Solutions
149,553
126,533
Specialized Diagnostic Solutions
32,662
39,452
Total revenues
$
1,061,684
$
852,465
QUIDEL CORPORATION
Reconciliation of Non-GAAP
Financial Information
(In thousands, except per share
data; unaudited)
Three months ended September
30,
Gross Profit
Operating Income
Net Income
Diluted EPS
2021
2020
2021
2020
2021
2020
2021
2020
GAAP Financial Results
$
373,408
$
383,619
$
281,841
$
307,959
$
215,752
$
232,268
Interest expense on Convertible Senior
Notes, net of tax
—
107
Net income used for diluted earnings per
share, if-converted method
215,752
232,375
$
5.08
$
5.33
Adjustments:
Non-cash stock compensation expense
909
539
7,005
5,553
7,005
5,553
Amortization of intangibles
2,089
1,901
7,929
7,129
7,929
7,129
Amortization of debt issuance costs on
credit facility
101
101
Non-cash interest expense for deferred
consideration
957
1,414
Loss on extinguishment of Convertible
Senior Notes
—
10,384
Gain on other investments
(1,164
)
—
Acquisition and integration costs
—
389
—
389
Foreign exchange loss (gain)
265
(159
)
Income tax impact of adjustments (a)
(3,170
)
(5,210
)
Adjusted
$
376,406
$
386,059
$
296,775
$
321,030
$
227,675
$
251,976
$
5.36
$
5.78
(a) Income tax impact of adjustments
represents the tax impact related to the non-GAAP adjustments
listed above and reflects an effective tax rate of 21% for 2021 and
21% for 2020.
QUIDEL CORPORATION
Reconciliation of Non-GAAP
Financial Information
(In thousands, except per share
data; unaudited)
Nine months ended September
30,
Gross Profit
Operating Income
Net Income
Diluted EPS
2021
2020
2021
2020
2021
2020
2021
2020
GAAP Financial Results
$
781,553
$
647,361
$
529,336
$
443,250
$
412,909
$
340,157
Interest expense on Convertible Senior
Notes, net of tax
—
457
Net income used for diluted earnings per
share, if-converted method
412,909
340,614
$
9.72
$
7.82
Adjustments:
Non-cash stock compensation expense
2,068
1,232
18,679
14,561
18,679
14,561
Amortization of intangibles
6,121
5,764
23,437
21,232
23,437
21,232
Amortization of debt issuance costs on
credit facility
303
303
Non-cash interest expense for deferred
consideration
3,515
5,026
Loss on extinguishment of Senior Credit
Facility
—
10,384
Gain on other investments
(1,164
)
—
Change in fair value of acquisition
contingencies
101
848
101
848
Change in fair value of derivative
liabilities - Convertible Senior Note
—
1,084
Acquisition and integration costs
1,754
3,175
1,754
3,175
Foreign exchange loss
798
347
Income tax impact of adjustments (a)
(9,959
)
(11,962
)
Adjusted
$
789,742
$
654,357
$
573,307
$
483,066
$
450,373
$
385,612
$
10.60
$
8.85
(a) Income tax impact of adjustments
represents the tax impact related to the non-GAAP adjustments
listed above and reflects an effective tax rate of 21% for each of
2021 and 2020.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211104006228/en/
Quidel Contact: Quidel Corporation Randy Steward Chief Financial
Officer 858.552.7931
Media and Investors Contact: Quidel Corporation Ruben Argueta
858.646.8023 rargueta@quidel.com
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