Earnings Beat for ABAX, Sluggish Overall - Analyst Blog
27 4월 2013 - 12:00AM
Zacks
Provider of portable blood analysis systems for human and
veterinary patient-care, Abaxis Inc. (ABAX)
reported fourth-quarter fiscal 2013 earnings per share (“EPS”) of
30 cents, a beat of 3 cents over the Zacks Consensus Estimate. The
result also sailed past the year-ago EPS by 42.8%.
Considering a $17.5 million gain from the company's litigation
settlement in the second quarter of fiscal 2013, the annual EPS was
pegged at $1.23, compared with the year-ago 58 cents. The Zacks
Consensus Estimate for EPS in fiscal 2013 was 80 cents.
Revenues soared 17% year over year to $50 million, although
missing the Zacks Consensus Estimate of $51 million in the quarter.
For the full year, revenues came in at $186 million, recording
annualized growth of 19% and ahead of the Zacks Consensus Estimate
by a million.
Quarter in Detail
On a geographic basis, revenues from North America (accounting
for 84% of total revenues) were up 18% to $41.9 million, while
revenues from the international market (representing 16%) climbed
10% to $8.1 million. Even amid a challenging macroeconomic scenario
in Spain and Italy, international growth came as an encouragement
for the company.
According to ABAX, this was primarily on the back of growth in
its higher margin consumable sales that represented 72% of the
total revenue in the reported quarter.
Within the customer group, Veterinary market revenues witnessed
a significant upside of 25% on a year-over-year basis to $42.9
million, while sales in the Medical market declined 18% year over
year to roughly $6.3 million. Excluding sales to the U.S.
government, worldwide Medical sales decreased 20% year over year to
$5.7 million.
The overall disappointing performance in the medical business
during the quarter was primarily due to the transition from a
direct sales model to a distribution model with Abbott
Laboratories (ABT). However, sales from the Other customer
group declined 2.8% year over year to approximately $758
million.
Total consumable sales increased 16% from the prior-year
quarter, while instrumental sales increased 8% on a year-over-year
basis. Sales of medical and veterinary reagent discs surged 14% to
$27 million in the fourth quarter. Total medical and veterinary
instrument unit sales improved 13% to 1,485 units. Moreover,
service revenues from Abaxis Veterinary Reference Laboratories
(AVRL) maintained its growth momentum and recorded sales of $1.8
million, up 31% on a sequential basis.
Margins
Despite a 12% increase in the fourth-quarter gross profit to
$26.2 million, gross margin contracted 230 basis points (bps) to
52.5%. The decline was attributed to lower ASPs on medical products
sold to Abbott and higher sales of other low-margin products.
The company recorded higher research and development expenses
(up 2.5% to $3.2 million) and sales and marketing (up 1% to $11.3
million) expenditure and general and administrative expenses (up
3.2% to $2.7 million) on a year-over-year basis. Despite the
increase in operating expenses (up 1.5% to $17.2 million), income
from operations surged 39.5% to $8.9 million, leading to a
significant 292 bps expansion in operating margin to 17.9%.
Abaxis exited the fiscal with cash and cash equivalents and
short-term investments of roughly $78.3 million, up from $67.5
million at the end of fiscal 2012.
Our Take
In spite of number of positives including quarterly and fiscal
earnings beat, we are not so encouraged with quarter’s result of
Abaxis, which seems quite sluggish. The difficult economic
conditions in Europe are still taking a toll on the company’s
international performance.
In addition, the distribution relationship with Abbott is yet to
bring fruitful outcomes. Besides, we are wary about the company's
increasing reliance on distributors to boost sales and the
competitive landscape with larger players. However, we believe that
Abaxis serves a niche market and is well poised to maintain its
growth momentum.
Abaxis carries a Zacks Rank #3 (Hold). Medical products
companies such as Cyberonics Inc. (CYBX), and
Health Net Inc. (HNT), which carry a Zacks Rank #1
(Strong Buy) are worth considering.
ABAXIS INC (ABAX): Free Stock Analysis Report
ABBOTT LABS (ABT): Free Stock Analysis Report
CYBERONICS INC (CYBX): Free Stock Analysis Report
HEALTH NET INC (HNT): Free Stock Analysis Report
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Abaxis, Inc. (delisted) (NASDAQ:ABAX)
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부터 6월(6) 2024 으로 7월(7) 2024
Abaxis, Inc. (delisted) (NASDAQ:ABAX)
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부터 7월(7) 2023 으로 7월(7) 2024