Quidel

News Release

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Quidel Reports Second Quarter Results

Pre-tax EPS Betters Street Consensus Estimates;
Company Reports Year-to-Date Cash Flow Per Share of 15 Cents

SAN DIEGO, July 31 /PRNewswire/ -- Quidel Corporation (Nasdaq: QDEL), a leading provider of rapid point-of-care (POC) diagnostic tests, today reported results for the three months ended June 30, 2001.

Net sales for the second quarter of 2001 were $15.5 million, compared with net sales of $16.6 million for the second quarter of 2000. Net sales for the second quarter of 2000 were impacted by unusually high levels of distributor stocking associated with the withdrawal of a key competitor from the market. The Company reported a pre-tax loss for the second quarter of 2001 of $798,000, or $0.03 per share, compared with a pre-tax loss of $2,000, or $0.00 per share, for the second quarter of 2000. Net loss for the second quarter of 2001 was $866,000, or $0.03 per share, compared with a net loss of $61,000, or $0.00 per share, for second quarter of 2000.

Cash flow (earnings before taxes, depreciation and amortization) for the second quarter of 2001 was $1.2 million, or $0.04 per share, as compared with the second quarter of 2000 of $1.3 million, or $0.05 per share.

Gross profit margin for the second quarter of 2001 was 47%, compared with a gross profit margin of 51% for the second quarter of 2000. Total operating expenses for the 2001 second quarter, including increased amortization associated with the acquisition of Litmus Concepts, were $8.5 million, compared with $8.3 million for second quarter of 2000.

"Our second quarter results mark the third consecutive quarter that we have met or bettered consensus earnings expectations. Similarly, we expect the remainder of the year to develop according to our internal plan. We are particularly pleased to report better than breakeven pre-tax earnings for the first half of 2001, despite the fairly substantial integration and amortization charges associated with the Litmus Concepts acquisition. Importantly, our cash flow for the six-month period ended June 30, 2001 was $0.15 per share," said Andre de Bruin, Quidel's Vice Chairman and Chief Executive Officer.

"Looking forward, we anticipate a strong second half of the year, aided by the launch of our new CLIA-waived QuickVue(R) Dipstick Strep A test and implementation of the first stage of our manufacturing enhancements for our pregnancy test products," added S. Wayne Kay, Quidel's President and Chief Operating Officer. "Pending final government approval, we also expect to introduce our QuickVue Influenza product into the Japanese market, late in the third quarter of 2001."

Conference Call Information
Quidel management will host a conference call to discuss second quarter results today, beginning at 5:00 p.m. Eastern Time. To listen via telephone, please call (888) 328-2945. A telephone replay will be available for 48 hours following the conclusion of the call by dialing (800) 633-8284, and entering reservation number 19418818. The conference call will be broadcast live over the Internet at http://www.quidel.com. A replay will also be available on Quidel's Website for 14 days.

About Quidel Corporation
Quidel Corporation discovers, develops, manufactures and markets rapid point-of-care, diagnostic tests for detection of medical conditions and illnesses. These products provide accurate, rapid and cost-effective diagnostic information for acute and chronic conditions associated with women's health, in areas such as reproduction and diseases of the elderly. Quidel also provides point-of-care diagnostics for infectious diseases, including influenza A and B, strep throat, H. pylori infection, chlamydia, infectious mononucleosis, and bacterial vaginosis. Quidel's products are sold to healthcare professionals for use in physician offices, clinical laboratories and pharmacies, and to consumers through organizations that provide private label, store brand products. These tests provide diagnostic information to enable rapid treatment and improve health outcomes, lower costs, and increase patient satisfaction. For more information, please visit Quidel's Web site at http://www.quidel.com.

This press release contains forward-looking statements regarding Quidel's future activities within the meaning of the federal securities laws. These forward-looking statements involve material risks and uncertainties. Many possible factors could affect the future results and performance of Quidel's business, such that actual results and performance may differ materially. If Quidel's products fail to perform as expected, or if there is lower consumer demand for these products than expected, Quidel's financial condition and operating results may be materially and adversely affected. Quidel's financial condition and operating results may also be materially and adversely affected by a number of other factors, including, without limitation, seasonality, adverse changes (both domestically and internationally) in competitive and economic conditions, actions by the Company's distributors, manufacturing and production delays or difficulties and adverse actions or delays in product reviews by the FDA. Please see the discussion of these and other factors in Quidel's annual report on Form 10-K and subsequent quarterly reports on Form 10-Q.

                              QUIDEL CORPORATION
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                    (In thousands, except per share data)
                                 (Unaudited)

                             Three months ended          Six months ended
                                  June 30,                   June 30,
                              2001          2000         2001          2000

    Net sales              $15,524       $16,583      $35,068       $38,247
    Cost of sales            8,184         8,100       17,178        18,614

    Gross profit             7,340         8,483       17,890        19,633

    Research and
     development             1,751         1,497        3,343         3,289
    Sales and marketing      3,289         4,395        7,391         9,143
    General and
     administrative          2,402         1,929        4,623         4,137
    Restructuring               --            --          550            --
    Amortization of
     intangibles             1,044           433        2,088         1,065

    Total operating
     expenses                8,486         8,254       17,995        17,634

    Income (loss) from
     operations             (1,146)          229         (105)        1,999

    Research contract,
     license and royalty
     income                   (468)         (325)        (866)         (639)
    Interest expense           345           549          682           598
    Interest income            (30)           (1)         (41)           (9)
    Other                     (195)            8         (184)          358

    Total other (income)
     expense                  (348)          231         (409)          308

    Earnings (loss) before
     income taxes and cumulative
     effect of change in
     accounting principle     (798)           (2)         304         1,691

    Income tax expense          68            59          753           827

    Earnings (loss) before
     cumulative effect of
     change in accounting
     principle                (866)          (61)        (449)          864

    Cumulative effect of
     January 1, 2000 change in
     accounting principle for
     adoption of SAB 101        --            --           --        (1,068)

    Net loss                 $(866)         $(61)       $(449)        $(204)

    Earnings (loss) per
     share before income
     taxes and cumulative
     effect of change in
     accounting principle
     - basic                $(0.03)       $(0.00)       $0.01         $0.07
    Earnings (loss) per
     share before income
     taxes and cumulative
     effect of change in
     accounting principle
     - diluted              $(0.03)       $(0.00)       $0.01         $0.06

    Earnings (loss) per
     share before cumulative
     effect of change
     in accounting principle
     - basic                $(0.03)       $(0.00)      $(0.02)        $0.04
    Earnings (loss) per
     share before cumulative
     effect of change
     in accounting principle
     - diluted              $(0.03)       $(0.00)      $(0.02)        $0.03

    Cumulative effect of
     change in accounting
     principle per share
     - basic and diluted       $--           $--          $--        $(0.04)

    Net loss per share
     - basic and diluted    $(0.03)       $(0.00)      $(0.02)       $(0.01)

    Weighted shares used
     in basic per share
     calculation            28,177        24,638       28,151        24,518
    Weighted shares used
     in diluted per share
     calculation            28,978        26,636       28,952        26,517

    Cash flow (earnings
     before taxes, depreciation,
     amortization and change
     in accounting
     principle)             $1,210        $1,278       $4,487        $4,964
    Cash flow per share
     - basic                  0.04          0.05         0.16          0.20
    Cash flow per share
     - diluted                0.04          0.05         0.15          0.19

    Gross profit as a
     % of net sales            47%           51%          51%           51%
    Research and development
     as a % of net sales       11%            9%          10%            9%
    Sales and marketing
     as a % of net sales       21%           27%          21%           24%
    General and administrative
     as a % of net sales       15%           12%          13%           11%


    Balance sheet data:     6/30/01      12/31/00
                          (Unaudited)
    Cash and cash
     equivalents            $1,527        $1,901
    Working capital         11,697        10,024
    Total assets            77,025        82,032
    Long term obligations   10,565        10,729
    Stockholders' equity    57,613        58,307

CONTACT:
Bruce Voss, bvoss@lhai.com,
or Martin Halsall, mhalsall@lhai.com,
of Lippert/Heilshorn & Associates, +1-310-691-7100;
or Sharon Platt, Investor Relations Associate, +1-858-552-7955,
or S. Wayne Kay, President & COO,+1-858-646-8063,
both of Quidel Corporation