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Luminex's (LMNX) Q3 Earnings and Revenues Miss Estimates
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Luminex Corporation reported third-quarter 2018 earnings of 5 cents per share, which fell short of the Zacks Consensus Estimate by 37.5%. The bottom line also plummeted 61.5% on a year-over-year basis.
Revenues in Detail
In the reported quarter, revenues came in at $72.4 million missing the Zacks Consensus Estimate of $74 million. On a year-over-year basis, the top line dipped 2.3%.
Total sample-to-answer molecular product revenues grew 15% from the prior-year quarter to $13.6 million.
However, per management, revenues in the reported quarter were negatively impacted by the LabCorp departure.
Luminex’s MDx franchise revenues also declined by 10%, year over year.
Luminex Corporation Price, Consensus and EPS Surprise
Revenues at this segment totaled $10 million, up 1.2% from the year-ago quarter.
Consumable Sales
This segment accounted for $11.6 million of revenues, up 9.5% year over year. The upside can be primarily attributed to higher bulk purchases by a large HLA partner.
Royalty Revenues
Royalty revenues summed $12.1 million, up 9.8% on a year-over-year basis.
Assay Revenues
This segment posted revenues worth $33.7 million, which decreased 11% on a year-over-year basis.
Service Revenues
Revenues in the segment grossed $3 million, which inched up 4.2% from the year-ago quarter number.
Other
Other revenues came in at $1.9 million, up 8.2% from a year ago.
Business Details
Per management, this Texas-based company secured 81 sample-to-answer molecular systems under contract in the quarter under review. Active sample-to-answer customers were about 560 by the end of the third quarter.
Sample-to-answer utilization per VERIGENE customer grew 7% to $104,000, while the same for ARIES grew 28% to $55,000 from the year-ago quarter level.
The company also shipped 284 multiplexing analyzers, comprising MAGPIX systems, LX systems and FLEXMAP 3D systems.
Last month, Luminex entered into a definitive agreement with EMD Millipore Corporation to acquire the latter’s flow cytometry portfolio valued at $75 million.
Margins
Gross profit in the reported quarter was $44.3 million, down 3.4% year over year. Gross margin was 61.1%, which contracted 70 basis points (bps).
Operating expenses totaled $40.5 million, reflecting an increase of 3.1% on a year-over-year basis.
Adjusted operating income amounted to $5.9 million, down significantly by 31.2% from the previous year number.
As a percentage of revenues, operating margin was 8.2%, down 340 bps on a year-over-year basis.
Research and development expenses grossed $12 million, up 12.4% year over year.
Selling, general and administrative expenses in the third quarter were $26.3 million, down slightly by 0.4% year over year.
Guidance
Luminex anticipates fourth-quarter 2018 revenues to be within $77-$79 million. The Zacks Consensus Estimate is pegged at $77.7 million, within the guided range.
For 2018, the company expects revenues to be within its guidance of $310-$316 million. The Zacks Consensus Estimate is pinned at $313.9 million, within the projected range.
Our Take
Luminex exited the third quarter on a dull note, with both earnings and revenues missing the consensus mark. However, the company continues to gain from its flagship ARIES and VERIGENE platforms that currently have a strong customer base. The company’s System, Consumables and Royalty revenues also improved significantly in the quarter under review. These apart, Luminex’s efforts in controlling operating expenses are noteworthy. Management also remains optimistic about the recent EMD Millipore acquisition, which is expected to contribute significantly to the company’s top line in 2019.
On the flip side, year-over-year declines in Luminex’s revenues and earnings are worrisome. The company’s assay revenues also declined in the third quarter. Per management, the departure of LabCorp in the quarter has significantly impacted Luminex’s top-line performance. Additionally, the company’s MDx franchise revenues fell significantly. Contraction in gross and operating margins add to the woes.
Earnings of MedTech Majors at a Glance
Some stocks from the broader Medical space that delivered robust earnings this season are Intuitive Surgical (ISRG - Free Report) , Stryker Corporation (SYK - Free Report) and Merit Medical Systems, Inc. (MMSI - Free Report) .
Intuitive Surgical reported third-quarter 2018 adjusted earnings per share of $2.83, which exceeded the Zacks Consensus Estimate of $2.65. Revenues totaled $920.9 million, which outpaced the consensus mark of $918.6 million.
Stryker posted third-quarter 2018 adjusted earnings per share of $1.69, which came ahead of the Zacks Consensus Estimate by a penny. Operating margin was 17.8%, up 30 bps.
Merit Medical reported third-quarter 2018 adjusted earnings per share of 47 cents, which trumped the Zacks Consensus Estimate of 42 cents. Revenues of $221.6 million edged past the consensus mark of $218 million.
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Luminex's (LMNX) Q3 Earnings and Revenues Miss Estimates
Luminex Corporation reported third-quarter 2018 earnings of 5 cents per share, which fell short of the Zacks Consensus Estimate by 37.5%. The bottom line also plummeted 61.5% on a year-over-year basis.
Revenues in Detail
In the reported quarter, revenues came in at $72.4 million missing the Zacks Consensus Estimate of $74 million. On a year-over-year basis, the top line dipped 2.3%.
Total sample-to-answer molecular product revenues grew 15% from the prior-year quarter to $13.6 million.
However, per management, revenues in the reported quarter were negatively impacted by the LabCorp departure.
Luminex’s MDx franchise revenues also declined by 10%, year over year.
Luminex Corporation Price, Consensus and EPS Surprise
Luminex Corporation Price, Consensus and EPS Surprise | Luminex Corporation Quote
Segmental Analysis
System Sales
Revenues at this segment totaled $10 million, up 1.2% from the year-ago quarter.
Consumable Sales
This segment accounted for $11.6 million of revenues, up 9.5% year over year. The upside can be primarily attributed to higher bulk purchases by a large HLA partner.
Royalty Revenues
Royalty revenues summed $12.1 million, up 9.8% on a year-over-year basis.
Assay Revenues
This segment posted revenues worth $33.7 million, which decreased 11% on a year-over-year basis.
Service Revenues
Revenues in the segment grossed $3 million, which inched up 4.2% from the year-ago quarter number.
Other
Other revenues came in at $1.9 million, up 8.2% from a year ago.
Business Details
Per management, this Texas-based company secured 81 sample-to-answer molecular systems under contract in the quarter under review. Active sample-to-answer customers were about 560 by the end of the third quarter.
Sample-to-answer utilization per VERIGENE customer grew 7% to $104,000, while the same for ARIES grew 28% to $55,000 from the year-ago quarter level.
The company also shipped 284 multiplexing analyzers, comprising MAGPIX systems, LX systems and FLEXMAP 3D systems.
Last month, Luminex entered into a definitive agreement with EMD Millipore Corporation to acquire the latter’s flow cytometry portfolio valued at $75 million.
Margins
Gross profit in the reported quarter was $44.3 million, down 3.4% year over year. Gross margin was 61.1%, which contracted 70 basis points (bps).
Operating expenses totaled $40.5 million, reflecting an increase of 3.1% on a year-over-year basis.
Adjusted operating income amounted to $5.9 million, down significantly by 31.2% from the previous year number.
As a percentage of revenues, operating margin was 8.2%, down 340 bps on a year-over-year basis.
Research and development expenses grossed $12 million, up 12.4% year over year.
Selling, general and administrative expenses in the third quarter were $26.3 million, down slightly by 0.4% year over year.
Guidance
Luminex anticipates fourth-quarter 2018 revenues to be within $77-$79 million. The Zacks Consensus Estimate is pegged at $77.7 million, within the guided range.
For 2018, the company expects revenues to be within its guidance of $310-$316 million. The Zacks Consensus Estimate is pinned at $313.9 million, within the projected range.
Our Take
Luminex exited the third quarter on a dull note, with both earnings and revenues missing the consensus mark. However, the company continues to gain from its flagship ARIES and VERIGENE platforms that currently have a strong customer base. The company’s System, Consumables and Royalty revenues also improved significantly in the quarter under review. These apart, Luminex’s efforts in controlling operating expenses are noteworthy. Management also remains optimistic about the recent EMD Millipore acquisition, which is expected to contribute significantly to the company’s top line in 2019.
On the flip side, year-over-year declines in Luminex’s revenues and earnings are worrisome. The company’s assay revenues also declined in the third quarter. Per management, the departure of LabCorp in the quarter has significantly impacted Luminex’s top-line performance. Additionally, the company’s MDx franchise revenues fell significantly. Contraction in gross and operating margins add to the woes.
Earnings of MedTech Majors at a Glance
Some stocks from the broader Medical space that delivered robust earnings this season are Intuitive Surgical (ISRG - Free Report) , Stryker Corporation (SYK - Free Report) and Merit Medical Systems, Inc. (MMSI - Free Report) .
Intuitive Surgical reported third-quarter 2018 adjusted earnings per share of $2.83, which exceeded the Zacks Consensus Estimate of $2.65. Revenues totaled $920.9 million, which outpaced the consensus mark of $918.6 million.
Stryker posted third-quarter 2018 adjusted earnings per share of $1.69, which came ahead of the Zacks Consensus Estimate by a penny. Operating margin was 17.8%, up 30 bps.
Merit Medical reported third-quarter 2018 adjusted earnings per share of 47 cents, which trumped the Zacks Consensus Estimate of 42 cents. Revenues of $221.6 million edged past the consensus mark of $218 million.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
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