NEW YORK (360Dx) – Oxford Immunotec reported after the close of the market on Monday that its fourth quarter revenues rose 22 percent year over year as product revenues spiked due in part to a new sales agreement with Quest Diagnostics.
For the three months ended Dec. 31, 2018, the Oxford, UK-based company tallied $15.4 million in total revenues compared to $12.6 million a year ago and edging analysts' consensus estimate of $15.1 million in revenues.
Product revenues jumped 29 percent to $14.5 million from $11.2 million while service revenues fell 36 percent to $916,000 from $1.4 million. On Nov. 6 Oxford Immunotec closed the sale of its US laboratory business to Quest Diagnostics for $170 million in cash, a deal originally announced in September.
As such, the company noted, total revenue and product revenue for the fourth quarter and full-year 2018 included sales to the former US lab business, while Q4 2019 revenues included T-SPOT.TB tuberculosis test kits and accessories sold to Quest after Nov. 6 as part of a long-term supply agreement.
In a conference call recapping the company's earnings, Oxford Immunotec CEO Peter Wrighton-Smith noted that global Q4 non-GAAP pro forma TB revenues were $15.6 million, representing year-over-year growth of about 14 percent, slightly ahead of internal expectations.
As previously reported, during the quarter Oxford Immunotec also terminated its blood donor screening service which had operated out of its Norwood, Massachusetts facility, near its main US office in Marlborough, Massachusetts. Excluding blood donor screening, pro forma revenue for Q4 was about $15.8 million, a 12 percent increase from Q4 2017 revenue of $14.1 million.
"2018 was a transformational year for Oxford Immunotec, and we exited the year a fundamentally changed company," Wrighton-Smith said during the call. "With dramatically simplified operations, improved top- and bottom-line profitability, and having significantly increased our financial and strategic flexibility with a markedly stronger balance sheet, we enter 2019 as a pure-play diagnostics products company focused on tuberculosis."
Oxford Immunotec's Q4 net income from continuing operations, excluding the divested US laboratory services business, was $33.7 million, or $1.25 per share, compared to $8.4 million, or $.31 per share in the year-ago period.
Total income for the recently completed quarter was $141.6 million, or $5.23 per share, compared to net income of $8.8 million, or $.33 per share, a year ago.
On a pro forma basis, Oxford Immunotec reported EPS of $.24 for Q4 2018. On average, analysts had expected EPS of $.19.
The company's Q4 R&D expenses fell 19 percent to $2.2 million from $2.7 million a year ago while its SG&A expenses fell 4 percent to $12.4 million from $12.9 million.
"Our R&D expenses have come down as we have exited the blood donor screening business and eliminated the expense associated with seeking [biologics license application] approvals for those tests," Oxford Immunotec CFO Rick Altieri said during the call. "Our R&D spend is now centered around our new cycle of product innovation in TB, as well as reducing TB kit manufacturing costs, so that we can continue our long track record of reducing costs of goods sold."
For full-year 2018, Oxford Immunotec's revenues grew 9 percent to $59.8 million from $54.7 million. Product revenues increased 12 percent to $54.7 million from $48.9 million while service revenues dropped 13 percent to $5.1 million from $5.8 million.
The company's 2018 net income from continuing operations was $13.6 million, or $.51 per share, compared to a net loss of $33.2 million, or a loss per share of $1.40 in 2017.
Total net income for 2018 was $121.3 million, or $4.56 per share, compared to a loss of $32.9 million, or $1.38 per share, in 2017. Pro forma net loss per share for 2018 was $.95.
Oxford Immunotec's full-year R&D expenses dropped 25 percent to $8.1 million from $10.8 million a year ago while its SG&A expenses fell 3 percent to $52.5 million from $54.4 million.
The company finished the quarter with $192.8 million in cash and cash equivalents.
For full-year 2019, the company expects revenues of between $69 million and $72 million, which would represent 5 percent to 9 percent year-over-year growth on a pro forma basis, or 8 percent to 12 percent year-over-year growth on a pro forma basis excluding blood donor screening revenue, Wrighton-Smith said during the call.