The story has been updated to include comments from NeoGenomics' conference call on Tuesday.Â
NEW YORK (GenomeWeb) – NeoGenomics today reported a 5 percent year-over-year rise in revenues for the second quarter, driven by strong growth in clinical genetic testing.
For the three months ended June 30, the Fort Myers, Florida-based cancer genetic testing firm recorded $66.1 million in total revenues, up from $63.1 million in the year-ago period and beating the consensus Wall Street estimate of $63.0 million.
Clinical testing brought in $59.8 million in revenues, up 6 percent from $56.3 million in Q2 2016. Pharma service revenues slipped 7 percent year over year to $6.3 million from $6.8 million.
Clinical genetic testing revenues were up 7 percent year over to $58.1 million from $54.2 million, as the number of tests completed increased 16 percent to 163,620 from 140,822 a year ago. The firm said that among the highlights of the quarter, it achieved a 13 percent reduction in average cost per clinical genetic test.
NeoGeomics Chairman and CEO Douglas VanOort said in a statement that in Q2, clinical division test volume growth strengthened to one of its highest levels since 2015, and revenue per test stabilized.
He noted that "Virtually every measure of performance improved compared with the first quarter."
On a conference call following the release of NeoGenomics' financial results, VanOort said that its molecular diagnostic business and the immunohistochemistry tests acquired as part of its buy of Clarient at the end of 2015 were NeoGenomics' two top fastest growing areas during Q2.
Along with cross synergies, the deal provided cross-selling opportunities, and so far, "that is happening, and you can see that molecular and immunohistochemistry are growing faster than our other tests. … I think that we've got a lot of room to continue to grow that, particularly on the molecular side."
Asked about the company's appetite and capacity for M&A, VanOort said that while the focus is on growing NeoGenomics organically, "We're pretty actively looking at possibilities."
There are available opportunities, he added and the company has begun discussions. "I think at this point, we would be interested in maybe acquiring where there are quick synergies," he said.Â
In Q2 2017, the company's R&D costs dropped 27 percent to $947,000 from $1.3 million a year ago, while its SG&A costs grew 15 percent to $28.9 million from $25.1 million.
For the quarter, NeoGenomics posted a net loss of $43,000, or $.03 per share, compared to a net gain of $413,000, or a loss of $.07 per share, a year ago. Adjusted EPS for Q2 2017 was $.04, beating the analysts' average estimate.
NeoGenomics finished the first quarter with $10.9 million in cash and cash equivalents.
The firm also reiterated its financial guidance for fiscal year 2017 that it released with its Q1 earnings. Â
It had revised its revenue guidance then to a between $255 million and $265 million. Net loss per share is expected to be in the range of $.10 to $.06, and adjusted EPS is expected to be in the range of $.17 to $.21.