SAN DIEGO, Feb. 9 /PRNewswire-FirstCall/ -- Biosite(R) Incorporated
(Nasdaq: BSTE) today reported that 2005 net income and diluted earnings per
share grew 30 percent and 21 percent, respectively, compared with 2004.
Revenue growth during that same period was 17 percent. The Company also
reported results for the fourth quarter of 2005, updated its 2006 financial
guidance and discussed expectations regarding research and development
objectives aimed at expanding Biosite's portfolio of innovative diagnostic
products. In addition, Biosite announced that it intends to repurchase up to
$30 million of Biosite common stock.
"We are pleased with our results, particularly in the area of year-over-
year gross margin and operating margin improvement," said Kim Blickenstaff,
Biosite chairman and chief executive officer. "Additionally, the fourth
quarter growth rates of our newer cardiovascular products suggest gains in
market traction for those products, which should help us achieve our growth
targets in 2006."
Fourth Quarter 2005 Financial Summary
* Total revenues for the fourth quarter of 2005 were $72.4 million, a
nine percent increase from $66.2 million in the comparable period of
2004. Cumulatively, sales of Biosite's Triage(R) Profiler products and
Triage D-Dimer Test accounted for approximately 53 percent of the
growth in product sales during the quarter, with sales of Triage BNP
test products largely contributing the remainder.
* Biosite's gross margin increased to 71 percent in the fourth quarter
compared with 67 percent in the fourth quarter of 2004. The rise
resulted in part from operational improvements resulting in lower scrap
and improved efficiencies.
* Operating income for the quarter totaled $20.3 million, a 23 percent
increase over operating income of $16.6 million in the comparable
period of 2004. The operating margin for the fourth quarter was
28 percent, compared with 25 percent in the like quarter of 2004.
* Net income in the fourth quarter was $13.7 million, up 13 percent from
$12.1 million in the fourth quarter of 2004. Diluted earnings per
share were $0.73, compared with $0.68 in the comparable period of 2004,
a seven percent increase. The Company noted that its fourth quarter
earnings in both 2005 and 2004 were favorably affected by decreases in
its effective income tax rate equivalent to $0.02 and $0.09 per diluted
share in the fourth quarters of 2005 and 2004, respectively.
* Cash and marketable securities at December 31, 2005 increased
83 percent to $132.4 million from $72.4 million at the end of 2004.
During this period, Biosite invested an additional $33.4 million in
construction of a new corporate complex.
Following are financial highlights for the quarter and year ended
December 31, 2005:
($ in 000's, except per share data and margins)
Three months ended Year ended
12/31/05 12/31/04 Chg. 12/31/05 12/31/04 Chg.
Triage(R) BNP
Test sales $46,893 $43,494 8% $189,614 $162,012 17%
Total product
sales 71,490 64,756 10% 282,772 240,607 18%
Total revenues 72,421 66,220 9% 287,699 244,942 17%
Net income 13,696 12,146 13% 54,029 41,448 30%
Diluted earnings
per share $0.73 $0.68 7% $2.92 $2.42 21%
Shares used in
calculating
diluted per
share amounts 18,773 17,824 5% 18,505 17,097 8%
Gross margin
on product sales 71% 67% 70% 67%
Operating margin 28% 25% 29% 26%
Cash flow from
operations $12,216 $229 NM $91,543 $52,492 74%
December 31, 2005 December 31, 2004 Chg.
Cash and
marketable
securities
balance $132,412 $72,410 83%
Financial Guidance Update
Commenting on expectations for 2006, Biosite management said that it
expects 2006 revenues of approximately $318 million. Non-GAAP diluted
earnings per share is expected to be approximately $3.12, while GAAP diluted
earnings per share is expected to be approximately $2.14.
Non-GAAP earnings per share expectations for 2006 exclude only the effects
of FAS 123R, Share-Based Payment, which is related to expensing of share-based
compensation, such as stock options. The Company adopted FAS 123R as of
January 1, 2006. See the guidance table included at the end of this release
for additional details regarding the Company's financial guidance data, a
reconciliation of non-GAAP financial guidance to GAAP financial guidance and a
description of certain factors that could affect the Company's actual
financial results. See also "About Non-GAAP Financial Measures" below.
"We expect continued gains in customer adoptions of our newer products to
contribute to growth in 2006, along with both higher utilization of our BNP
tests in hospitals and physician offices and expansion within international
markets," said Blickenstaff. "We believe Biosite is uniquely positioned to
build stockholder value through the creation of a balanced and diversified
portfolio of market-leading products that improve diagnosis. Therefore, we
will also continue to invest in both product development programs and newly
commercialized products to strengthen the infrastructure needed to achieve
success."
Other Developments
Biosite's stock repurchase program is currently effective. The timing of
repurchases and the exact number of shares of common stock to be purchased
will depend upon prevailing market conditions and other factors. Repurchases
under this program will be made using the Company's own cash resources and may
be made in the open market, in privately negotiated transactions, or through
the use of derivative securities and similar arrangements.
"In 2005, we generated $91.5 million in cash from operations," said
Blickenstaff. "We believe the current market price of our stock combined with
our strong cash position presents an opportunity to strengthen stockholder
value through strategic repurchases of Biosite stock."
Also in the fourth quarter, as previously announced, Biosite and Roche
Diagnostics Corporation initiated discussions regarding a potential settlement
of pending litigation between them. The United States District Courts in the
Southern District of California and the Southern District of Indiana have each
granted stays of the respective cases through April 2006 to provide the
parties an opportunity to resolve the disputes.
Research and Development Update
As previously reported, in the fourth quarter of 2005 Biosite filed a
510(k) Premarket Notification with the U.S. Food and Drug Administration (FDA)
seeking regulatory clearance for diagnostic tests for myeloperoxidase (MPO), a
blood biomarker of vascular inflammation. MPO appears to be an indicator of
unstable atherosclerotic plaque, and has been shown to elevate earlier than
current markers of cell death. The Company licensed certain diagnostic rights
to MPO in 2004 under an agreement with The Cleveland Clinic Foundation and
Prognostix, Inc. Biosite is targeting the first half of 2006 for launch of
its MPO tests, subject to regulatory clearance.
The Company also noted that it continues development of its sepsis test
and has largely completed sample collection from its retrospective clinical
study. The Company intends to file a Premarket Approval Application (PMA)
with the FDA for the sepsis test in 2006.
In addition, Biosite reiterated that it is on track to submit additional
clinical data pertaining to its Triage Stroke Panel within the 180 day
extension granted by the FDA in October 2005. The data are intended to
broaden and further diversify the population analyzed in Biosite's initial
clinical study. Biosite's PMA application for the Triage Stroke Panel is
currently on hold at the FDA. The Triage Stroke Panel was launched in several
European countries during the third quarter of 2005.
About Biosite(R) Incorporated
Biosite Incorporated is a leading bio-medical company commercializing
proteomics discoveries for the advancement of medical diagnosis. The
Company's products contribute to improvements in medical care by aiding
physicians in the diagnosis of critical diseases and health conditions.
Biosite's Triage(R) rapid diagnostics are used in approximately 50 percent of
U.S. hospitals and in more than 50 international markets. Information on
Biosite can be found at http://www.biosite.com.
Investor Conference Call
Biosite will host an investor conference call to discuss financial results
and research and development progress. The call will take place today,
February 9, 2006, at 1:30 p.m. PST. A live webcast of the call can be
accessed via the Internet at http://www.biosite.com. The phone number for U.S. and
international callers is (617) 614-4929 and the conference call code is
54201653. The call will be archived on the Biosite website for at least
21 days. The phone replay number is (888) 286-8010. International callers,
please dial (617) 801-6888. Please reference the conference call code
13230156.
About Non-GAAP Financial Measures
This press release contains financial guidance that excludes the expected
effect of share-based compensation expense and is not in accordance with U.S.
generally accepted accounting principles (GAAP). The Company believes that
this non-GAAP financial measure provides meaningful supplemental information
to both management and investors that is indicative of the Company's core
operating results and facilitates comparison of operating results across
reporting periods. The Company uses this non-GAAP measure when evaluating its
financial results as well as for internal resource management, planning and
forecasting purposes. This non-GAAP measure should not be viewed in isolation
to or as a substitute for the Company's financial guidance in accordance with
GAAP. Assumptions regarding the valuation of stock-based compensation and the
timing of events, such as the issuance of new stock-based compensation awards
and the realization of tax benefits, may differ from actual results. For more
information, please see the guidance table included at the end of this
release.
Forward-looking Statements
Except for the historical information presented herein, matters discussed
in this press release are forward-looking statements that involve risks and
uncertainties that could cause actual results to differ materially from any
future results, performance or achievements expressed or implied by such
statements. Examples of forward-looking statements are financial targets and
growth objectives and also include but are not limited to statements that are
preceded by, followed by, or that include the words "will"; "believes";
"should"; "intend"; "anticipates"; "plans"; "expects"; "estimates"; or similar
statements. Forward-looking statements in this press release include
statements regarding the Company's expected financial performance for 2006,
such as anticipated growth in revenues and earnings per share, and the
Company's ability to meet other growth targets; expected continued gains in
customer adoptions of newer products and higher utilization of the BNP tests;
the Company's plans to launch new products, such as MPO tests and panels; the
Company's ability to file a PMA for a sepsis panel in 2006; the Company's
plans to submit additional data for the Triage Stroke Panel; the Company's
plans to repurchase up to $30 million of its common stock; and the Company's
ability to access potential markers of disease, identify proteins with high
diagnostic utility, and develop and commercialize products and educate the
medical community on new diagnostic approaches. Risks and uncertainties
include risks associated with Biosite's ability to obtain regulatory approvals
and complete other clinical and pre-market activities needed to launch new
products as currently planned, including the Triage Stroke Panel and its
potential MPO tests; Biosite's ability to effectively promote and market
acceptance of the Triage Stroke Panel and its potential MPO tests; Biosite's
ability to commence and complete clinical trials as currently planned for a
sepsis panel; the implementation of automated and semi-automated manufacturing
methods that maintain or improve product quality and manufacturing efficiency;
costs and expenses that the Company may incur in transitioning from a
distributor sales model to a direct sales model in selected international
markets; Biosite's ability to effectively promote the Triage BNP Tests, either
directly or through distributors, and acceptance of the Triage BNP Test in the
physician office market; the continued growth of the BNP market; and costs and
expenses that the Company may incur from moving its existing manufacturing
operations into its new corporate complex or as a result of any delays in the
planned move. Biosite also faces risks associated with pending litigation
between the company and Roche Diagnostics Corporation and certain of its
affiliates (collectively "Roche"), including whether discussions between
Biosite and Roche will lead to a settlement of the litigation or that any
settlement, if reached, will be on terms favorable to Biosite. Other risks
that should be considered include risks associated with changing market
conditions, the extent to which products under development are successfully
developed and gain market acceptance, risks associated with the introduction
of competitive products from companies with greater capital and resources, and
risks and expenses associated with litigation, contract disputes, patent
conflicts, product recalls, manufacturing constraints, backlog, delays or
inefficiencies, shipment problems, seasonal customer demand, the timing of
significant orders, changes in reimbursement policies, regulatory changes,
competitive pressures on average selling prices, changes in the mix of
products sold, and the other risks detailed in the Company's most recent
Annual Report on Form 10-Q, and other SEC filings. The Company disclaims,
however, any intent or obligation to update these forward-looking statements.
Copies of the Company's SEC filings are available from the Investor Relations
department.
Biosite(R), Triage(R) and New Dimensions in Diagnosis(R) are registered
trademarks of Biosite Incorporated. MultiMarker Index(TM) is a trademark of
Biosite Incorporated.
Biosite Incorporated
Unaudited Statements of Income Data
(in thousands, except per share data, margins and %'s)
Three months ended Year ended
December 31, December 31,
% %
2005 2004 Change 2005 2004 Change
Total revenues:
Product sales $71,490 $64,756 10% $282,772 $240,607 18%
Contract revenue 931 1,464 (36%) 4,927 4,335 14%
Total revenues 72,421 66,220 9% 287,699 244,942 17%
Gross margin on
product sales 71% 67% 70% 67%
Operating expenses:
Cost of product
sales 20,953 21,468 (2%) 85,108 79,388 7%
Selling, general
and
administrative 19,828 17,730 12% 74,758 65,394 14%
Research and
development 10,706 10,282 4% 42,215 35,694 18%
License and patent
disputes 637 178 258% 1,977 178 1011%
Total operating
expenses 52,124 49,658 5% 204,058 180,654 13%
Operating income 20,297 16,562 23% 83,641 64,288 30%
Operating income as %
of total revenue 28% 25% 29% 26%
Interest and other
income, net 1,053 814 29% 2,722 1,313 107%
Income before provision
for income taxes 21,350 17,376 23% 86,363 65,601 32%
Provision for income
taxes (7,654) (5,230) 46% (32,334) (24,153) 34%
Net income $13,696 $12,146 13% $54,029 $41,448 30%
Diluted net income
per share $0.73 $0.68 7% $2.92 $2.42 21%
Diluted shares used in
calculating per share
amounts 18,773 17,824 18,505 17,097
Biosite Incorporated
Unaudited Balance Sheet Data
(in thousands)
December 31, 2005 December 31, 2004
Unaudited
Assets
Cash, cash equivalents &
marketable securities $132,412 $72,410
Accounts receivable 30,303 36,867
Inventories 32,627 37,077
Other current assets 9,422 14,513
Total current assets 204,764 160,867
Property, equipment and leasehold
improvements, net 151,018 111,135
Patents and license rights, net 4,764 5,484
Other assets 7,380 6,029
Total assets $367,926 $283,515
Liabilities and Stockholders' Equity
Current liabilities $39,104 $46,073
Long-term liabilities 13,457 17,105
Stockholders' equity 315,365 220,337
Total liabilities and
stockholders' equity $367,926 $283,515
Biosite Incorporated
Guidance Data
(in thousands, except per share data, margins and %'s)
The financial guidance provided below is an estimate based on information
available as of February 9, 2006. The Company's future performance and
financial results are subject to risks and uncertainties, and actual
results could differ materially from the guidance set forth below. Some
of the factors that could affect the Company's actual financial results
are stated above in the section entitled "Forward-looking Statements" and
in the Company's filings with the SEC. The Company assumes no obligation
to update the guidance set forth below.
Three months ended March 31, 2006
Non-GAAP Estimate Adjustments(a) GAAP Estimate
Triage(R) BNP product sales $52,000 -- $52,000
Total product sales $77,000 -- $77,000
Total revenues $78,000 -- $78,000
International revenue
as % of total revenues 14.0% -- 14.0%
Gross margin on product
sales 69.0% (1.0%)(b) 68.0%
Operating expenses
(excl. cost of sales)
as % of revenue 40.5% 6.5%(b) 47.0%
Operating income as
% of total revenues 29.0% (7.5%)(b) 21.5%
Diluted net income
per share $0.78 $(0.23)(b) $0.55
Income tax rate 37.5% 4.0%(b) 41.5%
Cash flow from operations 20,000 -- 20,000
Year ended December 31, 2006
Non-GAAP Estimate Adjustments(a) GAAP Estimate
Triage BNP product sales $201,000 -- $201,000
Total product sales $314,000 -- $314,000
Total revenues $318,000 -- $318,000
International revenue
as % of total revenues 14.5% -- 14.5%
Gross margin on product
sales 68.5% (1.0%)(b) 67.5%
Operating expenses
(excl. Cost of sales)
as % of Revenue 41.0% 7.0%(b) 48.0%
Operating income as
% of total revenues 28.5% (8.0%)(b) 20.5%
Diluted net income
per share $3.12 $(0.98)(b) $2.14
Income tax rate 37.5% 4.0%(b) 41.5%
Cash flow from operations $80,000 -- $80,000
(a) These adjustments reconcile the Company's non-GAAP financial guidance
to its GAAP financial guidance for the first quarter and full year
2006. See the section entitled "About Non-GAAP Financial Measures"
above.
(b) Reflects the estimated non-cash compensation expense attributable to
stock-based compensation awards including stock options and employee
stock purchase plan shares. This amount reflects the total estimated
expense from the application of SFAS No. 123R, which the Company
adopted as of January 1, 2006.
Biosite Incorporated
Selected Product Data
(in thousands, except margins and %'s)
Sales by Product:
Q1 2005 Q2 2005 Q3 2005 Q4 2005 FY 2005
Triage(R) Drugs of Abuse
Products $10,283 $11,341 $12,408 $11,018 $45,050
Triage Cardiac Panel 5,985 6,439 7,142 6,629 26,195
Triage BNP Tests 49,771 49,058 43,892 46,893 189,614
Triage Profiler Products 1,946 2,226 2,852 3,465 10,489
Triage D-Dimer Test 131 481 757 1,489 2,858
Triage Parasite Panel 255 283 355 269 1,162
Triage C. difficile Panel 1,349 1,377 942 988 4,656
Triage Meter 776 693 538 724 2,731
Triage Stroke Panel (EU) -- -- 2 15 17
Total Product Sales $70,496 $71,898 $68,888 $71,490 $282,772
International Sales:
Q1 2005 Q2 2005 Q3 2005 Q4 2005
International Sales as % of
Total Sales 13% 12% 12% 13%
BNP International Sales as %
of BNP Total Sales 10% 9% 9% 10%
Margin by Product Type (a):
Q1 2005 Q2 2005 Q3 2005 Q4 2005
Triage Drugs of Abuse
Product Line 82% 78% 82% 81%
Triage Cardiovascular
Product Line (incl. BNP) 72% 69% 69% 70%
(a) These margins do not include all products. The Triage Meter, Triage
Micro Product Line and Triage Stroke Panel are not included.
SOURCE Biosite Incorporated
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Related links:
http://www.biosite.com
Company News On-Call:
http://www.prnewswire.com/comp/116737.html
CONTACT:
Nadine Padilla, VP, Corporate & Investor
Relations, Biosite Incorporated, +1-858-805-2820,
npadilla@biosite.com
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