NEW YORK (GenomeWeb) – Alere today reported its financial results for the fourth quarter and full year ended Dec. 31, 2015, and filed its Form 10-K, which may hasten a proposed acquisition by Abbott.
For the fourth quarter of 2015, Alere reported a 7 percent year-over-year dip in revenues to $623.0 million from $667.0 million. The firm said that the revenue decrease was primarily due to the negative impact of $26.0 million in foreign currency exchange, a $7.0 million decrease in revenues from its pain management segment, and lower revenues related to Alere’s divestiture in November 2015 of its BBI business, which provides products and services for the diagnostic, healthcare, research, defense and food industries.
Each of the company's business units reported a revenue loss in Q4 2015, including a 17 percent fall in consumer diagnostics revenues to $20.0 million from $24.0 million.
Net loss for Q4 2015 narrowed to $19.0 million, or $0.28 per share, from $31.0 million, or $0.43 per share in the prior-year period. During the same period, the firm recognized $43.0 million in pre-tax expenses related to the voluntary withdrawal from the market of its INRatio PT/INR anti-coagulation system.
For 2015, Alere reported a 4 percent revenue decrease, year over year to $2.46 billion from $2.58 billion in 2014. The loss was due primarily to the negative impact of $121.0 million in foreign currency exchange, the firm said.
The firm reported revenue losses for each of its business segments in 2015, including a 4 percent dip in its consumer diagnostics business to $85.0 million from $89.0 million in 2014.
In the same period, the company reported a net loss from continuing operations of $13.0 million, or $0.40 per share, compared to $172.0 million, or $2.33 per share in the prior year period.
Alere also said that it has finished analyzing certain aspects of revenue recognition for 2015, 2014, and 2013, and each of the quarters during those years. As a result of the review — and to correct errors in its previously issued financial statements, which the company said were immaterial — Alere has revised its financial statements for the interim periods of 2015 and the years ended Dec. 31, 2014 and 2013.
Alere recognized additional income tax expense of $8.0 million for the first three quarters of 2015, and a reduction in income tax expense of $7.0 million in 2014 related to the timing of recognition of certain tax-specific items. These tax-related revisions resulted in a decrease of $.09 in earnings per share in the first nine months of 2015, and an increase of $.07 in earnings per share in 2014.
None of these revisions affected Alere’s cash flow or cash balances, the firm said.
“We are pleased to announce the completion of a thorough and diligent review of our historical revenue recognition processes,” said CEO Namal Nawana in a statement. “We are in the process of implementing a remediation plan and remain committed to providing accurate and transparent financial reporting.”
Alere is in the process of being acquired by Abbott, which agreed earlier this year to pay $5.8 billion to buy the company. Uncertainty around the acquisition emerged because Alere delayed filing its 10-K report with US securities regulators. Abbott then requested termination of the deal, which Alere refused. Alere has also received a grand jury subpoena from the US Department of Justice over sales practices and dealings in Africa, Asia, and Latin America.
In response to an analyst question in July, during a conference call to discuss his company’s Q2 earnings, Abbott CEO Miles White said, "One thing I am certain of is that they are trying to do everything they can, their way, to address the challenges in the company…Whether it all works out the way it was planned or not, I don't know, I can't predict."
In July, Alere released what it said was "preliminary unaudited financial information" for FY 2015, and for the quarter ended March 31. Alere said it expects to file its Q1 2016 Form 10-Q by August 18, and its Q2 2016 Form 10-Q as soon as practicable.
Shares of Alere were up almost 2 percent at $33.26 in morning trading on the New York Stock Exchange.