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Meridian Bioscience Fiscal Q1 Revenues Decline 5 Percent

NEW YORK – Meridian Bioscience reported on Friday that its fiscal first quarter revenues fell 5 percent year over year, down from record revenues in the first quarter of 2021.

For the three months ended Dec. 31, 2021, the firm reported revenues of $88.3 million, down from $92.9 million a year ago.

Meridian reported Q1 diagnostics revenues of $33.2 million, up 10 percent year over year from $30.3 million.

Within diagnostics, the firm reported molecular assays revenues of $4.8 million, up 4 percent year over year from $4.6 million, and immunoassays and blood chemistry assays revenues of $28.5 million, up 11 percent year over year from $25.7 million. Non-molecular assay revenues increased despite the negative impact of the firm's LeadCare product recall, which began in August, Meridian said in a statement.

The firm's gastrointestinal assays brought in the most revenue within diagnostics at $21.6 million, with CEO Jack Kenny saying on a conference call to discuss the firm's results that 45 percent of diagnostics revenue in the fiscal first quarter came from Helicobacter pylori testing. Meantime, respiratory illness test revenues totaled $6.4 million and blood chemistry assay revenues were $78,000. Other assays brought in $5.1 million.

Kenny also said that the company's Revogene SARS-CoV-2 test is being updated to work with the Omicron variant and that he is confident the test will ship by the end of the fiscal second quarter.

He noted that the firm does anticipate additional regulatory approvals for products from the US Food and Drug Administration this year but said that the agency has been dealing with backlogs from the COVID-19 pandemic and that he assumes it will take longer than normal to get those approvals.

Meridian's Q1 life science segment revenues were $55.1 million, down 12 percent year over year from $62.6 million. Molecular reagents revenues were $31.5 million, down 32 percent from $46.0 million in the previous year's quarter, while immunological reagents revenues were $23.6 million, up 42 percent from $16.6 million year over year.

Meridian said the life science segment "experienced a dramatic shift in net revenues mix from molecular products … to immunological products" that was "driven by the demand for COVID-19 rapid antigen tests relative to molecular test demand experienced in fiscal 2021."

Principal Accounting Officer Julie Smith said that while the company is no longer reporting the portion of reagent revenues that are COVID-19 related, the firm's year-over-year decline in molecular reagent revenues was related to decreasing molecular COVID-19 testing. She noted that in addition to the significant increase in COVID-19-related immunological reagents, non-COVID-19 immunological reagent revenues were up more than 30 percent compared to the previous year.

The company reported Q1 net earnings of $15.3 million, or $.35 per share, compared to $26.8 million, or $.61 per share in Q1 2021. Adjusted EPS was also $.35.

In Q1, the firm’s R&D costs rose 9 percent to $6.2 million from $5.7 million in Q1 2021, and its SG&A costs rose 18 percent to $22.4 million from $19.0 million.

Meridian had $72.7 million in cash and cash equivalents as of Dec. 31, 2021.

The company raised its full year 2022 guidance as a result of the fiscal first quarter. It now expects revenues between $315 million and $330 million, with life science revenues between $170 million and $180 million. Diagnostics revenue guidance is unchanged, with expectations between $145 million and $150 million. Meridian expects adjusted EPS in the range of $1.10 to $1.30.

The firm anticipates that its life science business will continue to see strong demand for reagents in the second fiscal quarter before COVID-19 infection rates decline and demand slows. It also said it expects demand for its undisclosed partner's SARS-CoV-2 rapid antigen test and the outperformance of the diagnostics segment during the just announced quarter to offset lost revenue from the delay in shipping its Revogene SARS-CoV-2 test.

In early morning trading on the Nasdaq on Friday, Meridian's shares were up nearly 7 percent at 22.77.