CARLSBAD, Calif., Aug. 04, 2020 (GLOBE NEWSWIRE) — GenMark Diagnostics, Inc. (Nasdaq: GNMK), a leading provider of automated, multiplex molecular diagnostic testing systems, today announced financial results for the quarter ended June 30, 2020.
Second Quarter 2020 HighlightsTotal revenue of $40.1 million, an increase of 118% over the second quarter of 2019ePlex® revenue of $35.2 million, an increase of approximately 195% over the second quarter of 2019Average annuity per analyzer of $188,000, up 74% over the second quarter of 2019COVID-19 testing drove a material increase in placements and revenueGross margin of 40%, compared to 36% in the second quarter of 2019Cash and investments were $132.8 million as of June 30, 2020, an increase of $85.7 million over the first quarter Delivered $8.0 million in positive cash flows from operating activitiesGenerated $75.4 million in net proceeds from common stock offering in May Second Quarter 2020 Operational HighlightsPlaced net 71 ePlex analyzers, concluding the quarter with a global installed base of more than 650 ePlex analyzers, an increase of 48% versus the second quarter of 2019Submitted an Emergency Use Authorization (EUA) to the U.S. Food and Drug Administration (FDA) for the ePlex Respiratory Pathogen Panel 2 (RP2 Panel), one of the first rapid-result multiplex panel tests that can identify 21 respiratory pathogens, including SARS-CoV-2Launched RP2 Panel for U.S. commercial distribution and clinical use“While we could not have anticipated the depth and duration of this global health crisis, our team continued to deliver on our commitments for 2020, including delivering exceptional revenue growth and continued gross margin improvement. And, for the first time in the company’s history, we achieved positive cash flow. This performance reflects the tremendous demand we’ve seen from both existing and new customers for our ePlex platform, and our ability to address that demand in an increasingly efficient and cost effective way,” said Scott Mendel, President and Chief Executive Officer. “As we enter the second half of the year, I am more confident than ever that GenMark’s business has been positively transformed for the long term, and is positioned as a leading innovator in multiplex molecular diagnostic testing systems.”Guidance for Full Year 2020
GenMark increases its total revenue guidance for the full year 2020 to a range of $155 million to $165 million. This compares to the previously stated range of $120 million to $130 million. The Company increased its global ePlex placement to 230 to 250 net new analyzers with an increased annuity per analyzer of $175,000 to $200,000. Gross margin is expected to be in the 38% to 40% range. Operating expenses are now expected to be approximately $70 million to $75 million.Cash usage excluding financing activities is projected to be in the range of $10 million to $15 million.Webcast and Conference Call Information
GenMark will be hosting a conference call to discuss second quarter results in further detail on today starting at 4:30 p.m. ET. The conference call will be concurrently webcast. The link to the webcast is available on the Company website at www.genmarkdx.com under the investor relations section and will be archived for future reference. To listen to the conference call, please dial (877) 312-5847 (US/Canada) or (253) 237-1154 (International) and use the conference ID number 1067506 approximately five minutes prior to the start time.About Emergency Use Authorization
The GenMark ePlex SARS-CoV-2 Test and ePlex RP2 Panel have been made available under an emergency access mechanism called an Emergency Use Authorization (EUA). The EUA is supported by the Secretary of Health and Human Service’s (HHS’s) declaration that circumstances exist to justify the use of in vitro diagnostics (IVDs) under EUA for the detection and/or diagnosis of COVID-19. An IVD made available under an EUA has not undergone the same type of review as an FDA cleared IVD. However, based on the totality of scientific evidence available, it is reasonable to believe that this IVD may be effective in the detection of COVID-19. The EUAs for these tests are in effect for the duration of the COVID-19 emergency, unless terminated or revoked (after which the tests may no longer be used). An FDA cleared IVD should be used instead of an IVD under EUA, when applicable and available.About GenMark Diagnostics
GenMark Diagnostics (NASDAQ: GNMK) is a leading provider of multiplex molecular diagnostic solutions designed to enhance patient care, improve key quality metrics, and reduce the total cost-of-care. Utilizing GenMark’s proprietary eSensor® detection technology, GenMark’s eSensor XT-8® and ePlex® systems are designed to support a broad range of molecular diagnostic tests with compact, easy-to-use workstations and self-contained, disposable test cartridges. GenMark’s ePlex: The True Sample-to-Answer Solution™ is designed to optimize laboratory efficiency and address a broad range of infectious disease testing needs, including respiratory, bloodstream, and gastrointestinal infections. For more information, visit www.genmarkdx.com.Safe Harbor Statement
This press release includes forward-looking statements regarding events, trends and business prospects, which may affect our future operating results and financial position. Such statements, including, but not limited to, those regarding our ability to secure enduring revenue streams extending beyond the COVID-19 pandemic, regulatory submissions and approvals, and plans and objectives of management, are all subject to risks and uncertainties that could cause our actual results and financial position to differ materially. Some of these risks and uncertainties include, but are not limited to, disruptions to our supply chain, our ability to achieve our updated financial and operational performance guidance, our ability to successfully obtain regulatory clearance for our ePlex RP2 Panel and commercialize our ePlex system and its related test menu in a timely manner, constraints or inefficiencies caused by unanticipated acceleration and deceleration of customer demand, our ability to retain customers beyond the COVID-19 pandemic, our ability to successfully expand sales of our product offerings outside the United States, and third-party payor reimbursement to our customers, as well as other risks and uncertainties described under the “Risk Factors” in our public filings with the Securities and Exchange Commission. We assume no responsibility to update or revise any forward-looking statements to reflect events, trends, or circumstances after the date they are made.Investor Relations Contact
Leigh Salvo
(415) 937-5404
ir@genmarkdx.com GENMARK DIAGNOSTICS, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except par value)GENMARK DIAGNOSTICS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(In thousands, except per share data)GENMARK DIAGNOSTICS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)GENMARK DIAGNOSTICS, INC.UNAUDITED RECONCILIATION OF NON-GAAP FINANCIAL MEASURES(In thousands)1 Severance payments and stock-based compensation expense resulting from the elimination of certain positions within the Company. Stock-based compensation expense resulted from the acceleration of the vesting of restricted stock units awarded to certain individuals.2 Severance payments and stock-based compensation expense resulting from the departure of the Company’s former President and CEO. The Company will be making a $1 million severance payment to the Company’s former President and CEO on October 1, 2020 and will be providing reimbursement for group health insurance premium payments pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) for 1 year following the separation date. The Company recognized $3 million in stock-based compensation expense resulting from the acceleration of the vesting of the outstanding unvested portion of restricted stock units and market-based stock units.Use of Non-GAAP Financial InformationIn addition to results reported under GAAP, we provide certain non-GAAP financial measures consisting of adjusted non-GAAP net loss and adjusted non-GAAP basic and diluted net loss per share. Non-GAAP net loss consists of the net loss reported in our Unaudited Condensed Consolidated Statement of Comprehensive Loss adjusted for nonrecurring severance payments and stock-based compensation expense from the elimination of certain positions and the departure of our former President and CEO. Adjusted non-GAAP basic and diluted net loss per share reflects the net loss per share reported in our Unaudited Condensed Consolidated Statement of Comprehensive Loss adjusted for the loss per share resulting from nonrecurring severance payments and stock-based compensation expense from the elimination of certain positions and the departure of our former President and CEO.We believe that use of these non-GAAP financial measures can assist investors in understanding the results from our core operations by providing additional insight into the impact of nonrecurring activities on our GAAP financial measures. We believe that the use of these non-GAAP financial measures enhances the comparability of our current period results to our historical Unaudited Condensed Consolidated Financial Statements, as well as to the results of other public companies.The use of these non-GAAP financial measures are not measurements of financial performance under GAAP and have been included solely for informational and comparative purposes. Other companies may define these non-GAAP financial measures differently and, as a result, our non-GAAP financial measures may not be directly comparable to the non-GAAP measures of other companies. We reconciled non-GAAP net loss and adjusted non-GAAP basic and diluted net loss per share to GAAP net loss and GAAP net loss per share, respectively, which we believe to be the most directly comparable GAAP financial measures. Reconciliations of non-GAAP and GAAP financial measures should be considered together with our Unaudited Condensed Consolidated Financial Statements.
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