- Revenues of $655.5 Million Grow 4.9% on a Reported Basis, 7.2% in Constant Currency -
- Company Records GAAP EPS of $0.17, Non-GAAP EPS of $0.41 -
- Company Raises Full-Year Revenue and Earnings Guidance -
BEDFORD, Mass., /PRNewswire/
-- Hologic, Inc. (NASDAQ: HOLX) announced today the Company's financial
results for the second fiscal quarter ended March 28, 2015. Quarterly
revenues of $655.5 million increased 4.9%
on a reported basis, and 7.2% on a constant currency basis. Non-GAAP
earnings per share (EPS) increased 10.8%, to $0.41.
"We posted strong organic revenue growth across the board for a
second straight quarter, while profitability increased at an even faster
rate," said Steve MacMillan, Hologic's
President and Chief Executive Officer. "As a Company, we have come a
long way in a short period of time. While we focus on continuing to
improve our performance, we are increasingly confident in our people and
products, and are therefore further raising our financial outlook for
the year."
Key financial results for the second fiscal quarter are shown below.
Throughout this press release, all dollar figures except EPS are in
millions. Unless otherwise noted, all results are for the second
quarter of fiscal 2015, are on a reported basis, and are compared to the
prior year period.
Revenue DetailRevenues
grew in all four business segments in the second fiscal quarter, and
increased 7.2% on a constant currency basis.
Other
revenue highlights from the second quarter of fiscal 2015 include:
- U.S. revenues of $495.2 million increased 6.8%, while international revenues of $160.3 million declined (0.7%). On a constant currency basis, international revenues increased 8.0%.
-
In Diagnostics:
- In Breast Health, revenue from breast imaging products and related
service increased 11.4% on a reported basis, and 13.8% on a constant
currency basis, as customers continued to adopt Hologic's Genius 3D
mammography.
- Molecular diagnostics sales increased 6.4% on a reported basis, and
7.9% on a constant currency basis, driven mainly by Aptima women's
health products on the fully automated Panther and Tigris platforms.
- Cytology and perinatal sales declined (5.2%) on a reported basis,
and (1.5%) on a constant currency basis, as declines in ThinPrep sales
continued to moderate.
- Blood screening revenue from our partner Grifols increased 8.3%, mainly due to new business with the Japanese Red Cross.
- In GYN Surgical, MyoSure system sales increased by 33.9% on a
reported basis and 35.2% on a constant currency basis. NovaSure system
sales declined by (0.1%) on a reported basis and increased by 2.5% on a
constant currency basis.
- Approximately 61% of total revenues were from disposables, 22% were from capital equipment, and 17% were from service and other.
Expense DetailGross
margin was 51.3% on a GAAP basis, and 63.4% on a non-GAAP basis. On a
non-GAAP basis, gross margin improved mainly due to strong sales growth
in the U.S. market, and favorable product mix in the Breast Health
division.
Operating expenses were $226.2 million on a GAAP basis, and $195.9 million
on a non-GAAP basis. The 4.3% increase in non-GAAP operating expenses
resulted mainly from higher research and development investment in the
Diagnostics business, and increased marketing spending in the Breast
Health division. These increases were offset by lower general and
administrative expenses.
Adjusted non-GAAP earnings before interest, taxes, depreciation and amortization (EBITDA) were $238.6 million in the second quarter, an increase of 7.3%.
Balance Sheet and Cash Flows
Hologic continues to focus on reducing its debt. Total debt outstanding at the end of the second fiscal quarter was $3,939.8 million, a $327.9 million decrease from the end of fiscal 2014. The Company ended the quarter with cash and equivalents of $675.1 million.
Operating cash flow was $157.8 million, while free cash flow, defined as operating cash flow less capital expenditures, was $139.2 million.
Updated Financial GuidanceBased
on its strong performance in the second quarter of fiscal 2015, Hologic
is raising its full year 2015 revenue and non-GAAP EPS guidance, as
shown in the table below. The guidance for reported results is based on
recent foreign exchange rates. Percentage changes from the prior year
exclude the one-time benefit associated with amending the Roka license
agreement, which added
$20.1 million of revenue and
$0.05
of EPS to the fourth quarter of fiscal 2014.
Since Hologic last provided financial guidance on
January 28, 2015,
the US dollar has continued to strengthen. If the dollar were at the
same level today as it was in January, the Company's new revenue
guidance would have been approximately
$9 million higher, and its new EPS guidance would have been about
$0.01
higher.
For
the third quarter of fiscal 2015, Hologic now expects:
Use of Non-GAAP Financial Measures
The
Company has presented the following non-GAAP financial measures in this
press release: constant currency revenues; non-GAAP gross margin;
non-GAAP operating expenses; non-GAAP operating margin; non-GAAP net
income; non-GAAP EPS; and adjusted EBITDA. The Company defines its
non-GAAP net income, EPS, and other non-GAAP financial measures to
exclude, as applicable: (i) the amortization of intangible assets and
impairment of goodwill and intangible assets; (ii) acquisition-related
charges and effects, such as charges for contingent consideration,
transaction costs, integration costs including retention, and credits
and/or charges associated with the write-up of acquired inventory and
fixed assets to fair value; (iii) non-cash interest expense related to
amortization of the debt discount from the equity conversion option of
the convertible notes; (iv) restructuring and divestiture charges; (v)
debt extinguishment losses and related transaction costs; (vi)
litigation settlement charges (benefits); (vii) other-than-temporary
impairment losses on investments; (viii) other one-time, non-recurring,
unusual or infrequent charges, expenses or gains that may not be
indicative of the Company's core business results; and (ix) income taxes
related to such adjustments. The Company defines adjusted EBITDA as
its non-GAAP net income plus net interest expense, income taxes, and
depreciation and amortization expense included in its non-GAAP net
income.
The
Company believes the use of non-GAAP financial measures is useful to
investors by eliminating certain of the more significant effects of its
acquisitions and related activities, non-cash charges resulting from the
application of GAAP to convertible debt instruments with cash
settlement features, charges related to debt extinguishment losses,
investment impairments, litigation settlements, and restructuring and
divestiture initiatives. These non-GAAP measures also reflect how
Hologic manages its businesses internally. In addition to the
adjustments set forth in the calculation of the Company's non-GAAP net
income and EPS, its adjusted EBITDA eliminates the effects of financing,
income taxes and the accounting effects of capital spending. As with
the items eliminated in its calculation of non-GAAP net income, these
items may vary for different companies for reasons unrelated to the
overall operating performance of a company's business. When analyzing
the Company's operating performance, investors should not consider these
non-GAAP financial measures as a substitute for net income prepared in
accordance with GAAP.
Future Non-GAAP Adjustments
Future GAAP EPS may be affected by changes in ongoing assumptions and
judgments, and may also be affected by non-recurring, unusual or
unanticipated charges, expenses or gains, which are excluded in the
calculation of the Company's non-GAAP EPS guidance as described in this
press release. It is therefore not practicable to reconcile non-GAAP EPS
guidance to the most comparable GAAP measure.
Conference Call and Webcast
Hologic's management will host a conference call at
4:30 p.m. ET today to discuss its second quarter fiscal 2015 operating results. Approximately 10 minutes before the call, dial
877-675-4751 (US and
Canada) or
719-325-4802 (international) and enter access code 1755131. A replay will be available starting two hours after the call ends through
May 29, 2015, at
888-203-1112 FREE or
719-457-0820 for international callers, access code 1755131. The Company will also provide a live webcast of the call at
www.investors.hologic.com/investors-overview.
A PowerPoint presentation related to the conference call will be posted
to the same site.
Source credit:
Hologic, Inc.