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Abaxis Reports Financial Performance For The Fourth Quarter And Fiscal 2013
Date:4/25/2013

UNION CITY, Calif., April 25, 2013 /PRNewswire/ -- Abaxis, Inc. (NasdaqGS: ABAX), a medical products company manufacturing point-of-care blood analysis systems, today reported financial results for the fourth quarter and fiscal year ended March 31, 2013.

Record fourth quarter and fiscal 2013 results include:

  • Revenues of $50.0 million for the fourth quarter, up 17% over last year's comparable quarter, and $186.0 million for fiscal 2013, up 19% year-over-year.
  • North America revenues of $41.9 million for the fourth quarter, up 18% over last year's comparable quarter, and $152.8 million for fiscal 2013, up 18% year-over-year.
  • Veterinary market revenues of $42.9 million for the fourth quarter, up 25% over last year's comparable quarter, and $150.5 million for fiscal 2013, up 23% year-over-year.
  • Total medical and veterinary reagent disc sales of $27.0 million for the fourth quarter, up 14% over last year's comparable quarter, and $99.3 million for fiscal 2013, up 13% year-over-year.
  • Other fourth quarter and fiscal 2013 highlights include:

  • International revenues of $8.1 million for the fourth quarter, up 10% over last year's comparable quarter, and $33.3 million for fiscal 2013, up 20% year-over-year.
  • Total medical and veterinary instrument revenues of $10.6 million for the fourth quarter, up 8% over last year's comparable quarter, and $46.0 million for fiscal 2013, up 31% year-over-year.
  • Total medical and veterinary instrument sales of 1,485 units for the fourth quarter, up 13% over last year's comparable quarter, and 6,173 units for fiscal 2013, up 30% year-over-year.
  • Total medical and veterinary reagent disc sales of 2.0 million units for the fourth quarter, up 11% over last year's comparable quarter, and 7.5 million units for fiscal 2013, up 11% year-over-year.
  • Diluted net income per share of $0.30 for the fourth quarter, up 43% over last year's comparable quarter.
  • Service revenues from Abaxis Veterinary Reference Laboratories (AVRL) of $1.8 million for the fourth quarter, up 31% over the third quarter of fiscal 2013.
  • Quarterly Results:  For the fiscal quarter ended March 31, 2013, Abaxis reported revenues of $50.0 million, as compared with revenues of $42.7 million for the comparable period last year, an increase of 17 percent.  Revenues from sales of instruments, which include chemistry analyzers, hematology instruments, VSpro specialty analyzers and i-STAT analyzers, increased by an aggregate of $0.8 million or 8 percent, over the same period last year.  Revenues from sales of consumables, which include reagent discs, hematology reagent kits, VSpro specialty cartridges, i-STAT cartridges and rapid tests, increased by an aggregate of $5.0 million, or 16 percent, over the same period last year.  Abaxis reported net income of $6.7 million for the fiscal quarter ended March 31, 2013, compared to $4.7 million for the same period last year, an increase of 42 percent.  Abaxis' effective tax rate in the quarter ended March 31, 2013 was 25 percent, compared to 32 percent for the same period last year.  Abaxis reported diluted net income per share of $0.30 (calculated based on 22,486,000 shares) for the three-month period ended March 31, 2013, compared to $0.21 per share (calculated based on 22,070,000 shares) for the same period last year. 

    Fiscal 2013 Results:  For the fiscal year ended March 31, 2013, Abaxis reported revenues of $186.0 million, as compared with revenues of $156.6 million for the prior year, an increase of 19 percent.  Revenues from instruments increased by an aggregate of $10.9 million, or 31 percent, over the prior year.  Revenues from consumables increased by an aggregate of $13.7 million, or 12 percent, over the prior year.  The company reported net income of $27.5 million, including gain from the company's litigation settlement in the second quarter of fiscal 2013, compared to $13.1 million for the prior year.  The company's effective tax rate in fiscal 2013 and 2012 was 35 percent.  The company reported diluted net income per share of $1.23 (calculated based on 22,381,000 shares) for fiscal 2013, compared to $0.58 per share (calculated based on 22,462,000 shares) for fiscal 2012. 

    Other Reported Information:  Total sales in the medical market for the fourth quarter of fiscal 2013 were $6.3 million, a decrease of 18 percent compared to the same period last year.  Medical sales worldwide, excluding sales to the U.S. government, during the fourth quarter of fiscal 2013 were $5.7 million, a decrease of 20 percent compared to the same period last year.  Total sales in the veterinary market for the fourth quarter of fiscal 2013 were $42.9 million, an increase of 25 percent, compared to the same period last year.  Total medical and veterinary reagent disc sales for the fourth quarter of fiscal 2013 were $27.0 million, an increase of 14 percent compared to the same period last year.  Non-cash compensation expense recognized for share-based awards during the fourth quarter of fiscal 2013 was $1.8 million, compared to $1.5 million for the same period last year.

    Clint Severson, chairman and chief executive officer of Abaxis, said, "We are pleased with the operating results achieved in the fourth quarter and fiscal year 2013.  Instrument sales across the board, including both the veterinary and the medical markets, were up 31 percent for the year.  Reagent disc unit sales for the year were up 11 percent to a record 7.5 million units.  Additionally, we are gratified that the ten-year compounded annual growth rate in our total reagent disc unit sales is greater than 15 percent.  Sales in North America and internationally were up 18 percent and 20 percent, respectively.  One of the key strengths of the company is our higher margin consumable sales, which increased 16 percent in the fourth quarter and represented 72 percent of total fourth quarter revenue.  We remain firmly focused on maximizing this core component of our business which constitutes our recurring revenue stream."

    "Fiscal year 2013 marks the 12th consecutive year of profitability for Abaxis.  Given the challenging global macroeconomic conditions of the past five years, we are extremely proud of our ability to operate effectively and profitably in uncertain times," continued Mr. Severson.  "The financial underpinnings of the company are very strong.  We maintain a solid cash position, which provides us a level of stability during these difficult times.  During fiscal year 2013, we paid a special one-time dividend to our loyal shareholders.  Looking ahead, we are excited about our strategic initiatives and the opportunities with our new distributors, Abbott Point of Care, Inc. for medical products and MWI Veterinary Supply, Inc. for animal health products.  Our expectation is that as the medical market distribution channel becomes more developed in the coming quarters, medical market products will also become consistent double-digit growers.  We are excited with the possibilities ahead."

    Conference CallAbaxis has scheduled a conference call to discuss its results at 4:15 p.m. Eastern Time on Thursday, April 25, 2013.  Participants can dial (877) 317-6789 or (412) 317-6789 to access the conference call, or can listen via a live Internet web cast, which is available in the Investor Relations section of the company's website at http://www.abaxis.com.  A replay of the call will be available by visiting http://www.abaxis.com for the next 30 days or by calling (877) 344-7529 or (412) 317-0088, confirmation code 10027780, through May 1, 2013.  This press release is also available prior to and after the call via Abaxis' website or the Securities and Exchange Commission's website at http://www.sec.gov

    About AbaxisAbaxis develops, manufactures, markets and sells portable blood analysis systems for use in any veterinary or human patient-care setting to provide clinicians with rapid blood constituent measurements.  The system consists of a compact, 5.1 kilogram (11.2 pounds), portable analyzer and a series of single-use plastic discs, called reagent discs that contain all the chemicals required to perform a panel of up to 13 tests on veterinary patients and 14 tests on human patients.  The system can be operated with minimal training and performs multiple routine tests on whole blood, serum or plasma samples.  The system provides test results in less than 12 minutes with the precision and accuracy equivalent to a clinical laboratory analyzer.  The veterinary business also provides to the animal health and research market a line of hematology instruments for point-of-care complete blood counts (CBC), a specialty instrument to screen for and detect clotting disorders and to measure equine fibrinogen levels, a handheld instrument for the rapid assessment of certain critical care tests and rapid point-of-care tests for Heartworm infections, Parvovirus, Giardia and Lyme disease.  Abaxis, through its AVRL division, provides routine laboratory testing as well as specialty testing for veterinarians nationwide.

    Use of Financial MeasuresTo supplement the financial statements presented in accordance with United States generally accepted accounting principles (GAAP), Abaxis uses operating income per share, a non-GAAP financial measure. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. For more information on this non-GAAP financial measure, refer to the table captioned "Operating Income Per Share" included at the end of this release.  Abaxis defines operating income per share as operating income divided by the weighted average outstanding shares.  Management uses this measure in comparing Abaxis' operating results with historical performance and believes it provides meaningful and comparable information to management and investors to assist in their review of Abaxis' performance relative to prior periods and its competitors.

    Forward Looking StatementsThis press release includes, and our conference call will include, statements that constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Reform Act"), including but not limited to statements related to Abaxis' cash position, financial resources and potential for future growth, market acceptance and penetration of new or planned product offerings, and future recurring revenues and results of operations.  Abaxis claims the protection of the safe-harbor for forward-looking statements contained in the Reform Act.  These forward-looking statements are often characterized by the terms "may," "believes," "projects," "expects," "anticipates," or words of similar import, and do not reflect historical facts.  Specific forward-looking statements contained in this press release or in Abaxis' conference call may be affected by risks and uncertainties, including, but not limited to, those related to losses or system failures with respect to Abaxis' facilities or manufacturing operations, fluctuations in quarterly operating results, dependence on sole suppliers, the market acceptance of Abaxis' products and services, the continuing development of its products, required United States Food and Drug Administration clearance and other government approvals, risks associated with manufacturing and distributing its products on a commercial scale free of defects, risks related to the introduction of new instruments manufactured by third parties, risks associated with competing in the human diagnostic market, risks related to transitioning our medical sales to Abbott, risks related to the protection of Abaxis' intellectual property or claims of infringement of intellectual property asserted by third parties and risks related to condition of the United States economy.  Readers should also refer to the section entitled "Risk Factors" in Abaxis' Annual Report on Form 10-K, its most recent Quarterly Report on Form 10-Q and Abaxis' other periodic reports filed with the United States Securities and Exchange Commission.  Forward-looking statements speak only as of the date the statements were made.  Abaxis does not undertake and specifically disclaims any obligation to update any forward-looking statements.

    Financial Tables to FollowABAXIS, INC.Condensed Consolidated Statements of Income(In thousands, except per share data)(Unaudited)Three Months EndedTwelve Months EndedMarch 31,March 31,2013201220132012Revenues

    $
    49,951

    $
    42,718

    $
    86,025

    $
    56,596Cost of revenues

    23,768

    19,337

    87,794

    71,493Gross profit

    26,183

    23,381

    98,231

    85,103Operating expenses:Research and development 

    3,229

    3,150

    13,577

    12,246Sales and marketing 

    11,296

    11,204

    46,943

    39,618General and administrative

    2,672

    2,588

    12,825

    13,782Gain from legal settlement

    -

    -

    (17,250)

    -Total operating expenses

    17,197

    16,942

    56,095

    65,646Income from operations

    8,986

    6,439

    42,136

    19,457Interest and other income (expense), net

    (65)

    451

    253

    710Income before income tax provision

    8,921

    6,890

    42,389

    20,167Income tax provision

    2,223

    2,184

    14,930

    7,076Net income

    $
    ,698

    $
    4,706

    $
    27,459

    $
    3,091Net income per share:  Basic net income per share

    $
    .30

    $
    .22

    $
    .25

    $
    .59  Diluted net income per share

    $
    .30

    $
    .21

    $
    .23

    $
    .58Shares used in the calculation of net income per share:  Weighted average common shares outstanding - basic

    22,081

    21,693

    21,946

    22,084  Weighted average common shares outstanding - diluted

    22,486

    22,070

    22,381

    22,462 ABAXIS, INC.Condensed Consolidated Balance Sheets(Unaudited and in thousands)March 31,March 31,20132012Current assets: Cash and cash equivalents

    $
    54,910

    $
    45,843 Short-term investments

    23,354

    21,689 Receivables, net

    40,005

    30,694 Inventories

    26,786

    19,597 Prepaid expenses and other current assets

    3,319

    5,423 Net deferred tax assets, current

    4,589

    4,151Total current assets 

    152,963

    127,397Long-term investments

    17,000

    23,442Investment in unconsolidated affiliate

    2,613

    2,626Property and equipment, net

    25,330

    24,296Intangible assets, net

    3,122

    3,990Net deferred tax assets, non-current

    643

    -Other assets

    92

    85Total assets

    $
    201,763

    $
    81,836Current liabilities: Accounts payable

    $
    8,123

    $
    ,381 Accrued payroll and related expenses

    6,261

    6,336 Accrued taxes

    440

    266 Other accrued liabilities

    2,838

    1,991 Deferred revenue

    1,362

    1,212 Warranty reserve

    995

    1,245Total current liabilities

    20,019

    17,431Non-current liabilities: Deferred rent

    729

    641 Net deferred tax liabilities

    -

    199 Deferred revenue

    3,750

    2,396 Warranty reserve

    389

    601 Notes payable, less current portion

    682

    783Total non-current liabilities

    5,550

    4,620Total liabilities

    25,569

    22,051Shareholders' equity: Common stock

    121,019

    110,063 Retained earnings 

    55,133

    49,697 Accumulated other comprehensive income

    42

    25Total shareholders' equity

    176,194

    159,785Total liabilities and shareholders' equity

    $
    201,763

    $
    81,836 Operating Income Per Share(In thousands, except per share data)Three Months EndedTwelve Months EndedMarch 31,March 31,2013201220132012Shares used in the calculation of operating income per share:  Weighted average common shares outstanding - basic

    22,081

    21,693

    21,946

    22,084  Weighted average common shares outstanding - diluted

    22,486

    22,070

    22,381

    22,462Operating income per share - basic

    $
    .41

    $
    .30

    $
    .92

    $
    .88Operating income per share - diluted

    $
    .40

    $
    .29

    $
    .88

    $
    .87Revenues by Geographic Region(In thousands)Three Months EndedTwelve Months EndedMarch 31,March 31,2013201220132012North America

    $
    41,898

    $
    35,429

    $
    52,774

    $
    28,969International

    8,053

    7,289

    33,251

    27,627Total revenues

    $
    49,951

    $
    42,718

    $
    86,025

    $
    56,596Revenues by Customer Group(In thousands)Three Months EndedTwelve Months EndedMarch 31,March 31,2013201220132012Medical Market

    $
    ,277

    $
    7,682

    $
    31,643

    $
    30,404Veterinary Market

    42,916

    34,256

    150,510

    122,253Other

    758

    780

    3,872

    3,939Total revenues

    $
    49,951

    $
    42,718

    $
    86,025

    $
    56,596 

     


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    SOURCE Abaxis, Inc.
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