Meridian Bioscience Provides Sales and Earnings Guidance for Fiscal 2013 and Reaffirms Fiscal 2012 Guidance
<0> Meridian Bioscience, Inc.John A. Kraeutler, Chief Executive Officer, 513-271-3700 </0>
Meridian Bioscience, Inc. (NASDAQ: VIVO) today provided the financial community with guidance regarding the Company’s fiscal 2013 sales and earnings estimates. Based on the Company’s business planning and budgeting activities for the fiscal year ending September 30, 2013, management expects net sales to be in the range of $190 to $195 million and per share diluted earnings to be between $0.86 and $0.91. The per share estimates assume an increase in average shares outstanding from approximately 41.6 million at fiscal 2012 year end to 41.8 million at fiscal 2013 year end. Net earnings are expected to increase between 8% and 14% from fiscal 2012 to fiscal 2013 excluding reorganization costs in 2012. This includes the $0.03 charge to earnings for the Medical Device Tax effective January 1, 2013 and the $0.03 charge to earnings representing the incremental cost of clinical trials for an important new product over and above the cost of clinical trials for past products. The sales and earnings guidance provided in this press release is from expected internal growth and does not include the impact of any additional acquisitions the Company might complete during fiscal 2013.
On July 26, 2012, management revised guidance downward for fiscal 2012 and reaffirms that guidance of per share diluted earnings of between $0.78 - $0.81 on net sales of $171 million to $175 million.
John A. Kraeutler, Chief Executive Officer, stated, “Our expectations for fiscal year 2013 are realistic and are based, in part, upon where the Company expects its results to be for fiscal 2012, ending September 30. Revenue increases using the mid-point of guidance are 11%, and are expected to be driven primarily by contributions from our molecular technology platform, organic growth coming from our Bioline Life Science unit, continued expansion of our managed care collaborative efforts that are designed to motivate physicians to test patients for and, consistent growth from converting labs to testing with our rapid foodborne products. Beginning on January 1, 2013, the Medical Device Tax, part of the Affordable Care Act legislation, becomes effective. The majority of our US diagnostics revenue will be taxed at 2.3% resulting in a charge of over $2 million.
“Specifically, with regard to revenues, our guidance includes tests for disease, tests for Group B strep and tests for Group A strep which is expected to be FDA cleared for U.S. marketing around the start of the new fiscal year. Mycoplasma and Pertussis revenues are not included as these products are not expected to be available for sale until late in the first half of fiscal 2013.
“Our new product pipeline is robust and we plan to introduce two additional new tests later in fiscal 2013. These tests are in the category of common sexually transmitted diseases and they have large market potential. In addition, we expect to launch a rapid immunoassay that will be useful in the diagnosis of sepsis and, we plan to debut a device that greatly simplifies DNA extraction from human specimens. The tests in development offer significant opportunity however; we expect that clinical trial costs will be sizeable. We have allocated an incremental $2+ million for these trials and that expense is reflected in the guidance calculation. New revenues related to this incremental R&D investment will be realized in late fiscal 2013 or early 2014. The reduction in earnings from this incremental expense, along with the charge due to the Medical Device Tax, is expected to be $0.06.”
William J. Motto, Executive Chairman, commented, “We believe the guidance provided in this press release is realistic. During fiscal 2013, we will continue to introduce new products, including those for our molecular-based platform, maintain a strong balance sheet, continue to pay liberal cash dividends, and focus on cost efficiencies throughout the organization. As usual, we will actively look for accretive acquisition opportunities that fit well with our expanding business.”
FORWARD LOOKING STATEMENTSThe Private Securities Litigation Reform Act of 1995 provides a safe harbor from civil litigation for forward-looking statements accompanied by meaningful cautionary statements. Except for historical information, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, which may be identified by words such as "estimates", "anticipates", "projects", "plans", "seeks", "may", "will", "expects", "intends", "believes", "should" and similar expressions or the negative versions thereof and which also may be identified by their context. Such statements, whether expressed or implied, are based upon current expectations of the Company and speak only as of the date made. The Company assumes no obligation to publicly update or revise any forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized. These statements are subject to various risks, uncertainties and other factors that could cause actual results to differ materially, including, without limitation, the following:
Meridian's continued growth depends, in part, on its ability to introduce into the marketplace enhancements of existing products or new products that incorporate technological advances, meet customer requirements and respond to products developed by Meridian's competition. While Meridian has introduced a number of internally developed products, there can be no assurance that it will be successful in the future in introducing such products on a timely basis. Meridian relies on proprietary, patented and licensed technologies, and the Company’s ability to protect its intellectual property rights, as well as the potential for intellectual property litigation, would impact its results. Ongoing consolidations of reference laboratories and formation of multi-hospital alliances may cause adverse changes to pricing and distribution. Recessionary pressures on the economy and the markets in which our customers operate, as well as adverse trends in buying patterns from customers can change expected results. Costs and difficulties in complying with laws and regulations, including those administered by the United States Food and Drug Administration, can result in unanticipated expenses and delays and interruptions to the sale of new and existing products. The international scope of Meridian’s operations, including changes in the relative strength or weakness of the U.S. dollar and general economic conditions in foreign countries, can impact results and make them difficult to predict. One of Meridian's main growth strategies is the acquisition of companies and product lines. There can be no assurance that additional acquisitions will be consummated or that, if consummated, will be successful and the acquired businesses will be successfully integrated into Meridian's operations. There may be risks that acquisitions may disrupt operations and may pose potential difficulties in employee retention and there may be additional risks with respect to Meridian’s ability to recognize the benefits of acquisitions, including potential synergies and cost savings or the failure of acquisitions to achieve their plans and objectives. The Company cannot predict the possible impact of recently-enacted United States healthcare legislation and any similar initiatives in other countries on its results of operations. In addition to the factors described in this paragraph, Part I, Item 1A Risk Factors of our Form 10-K contains a list and description of uncertainties, risks and other matters that may affect the Company.
Meridian is a fully integrated life science company that manufactures, markets and distributes a broad range of innovative diagnostic test kits, purified reagents and related products and offers biopharmaceutical enabling technologies. Utilizing a variety of methods, these products and diagnostic tests provide accuracy, simplicity and speed in the early diagnosis and treatment of common medical conditions, such as gastrointestinal, viral and respiratory infections. Meridian’s diagnostic products are used outside of the human body and require little or no special equipment. The Company's products are designed to enhance patient well-being while reducing the total outcome costs of healthcare. Meridian has strong market positions in the areas of gastrointestinal and upper respiratory infections, serology, parasitology and fungal disease diagnosis. In addition, Meridian is a supplier of rare reagents, specialty biologicals and related technologies used by biopharmaceutical companies engaged in research for new drugs and vaccines. The Company markets its products and technologies to hospitals, reference laboratories, research centers, diagnostics manufacturers and biotech companies in more than 60 countries around the world. The Company’s shares are traded through NASDAQ’s Global Select Market, symbol VIVO. Meridian's website address is .