GenProbe Inc. (GPRO) filed Quarterly Report for the period ended 2009-09-30.
Gen-Probe Inc. is a global leader in the development manufacture and marketing of rapid accurate and cost-effective nucleic acid testing (NAT) products used for the clinical diagnosis of human diseases and for screening donated human blood. Using its patented NAT technology Gen-Probe has received FDA approvals for more than 40 products that detect a wide variety of infectious microorganisms including those causing sexually transmitted diseases tuberculosis strep throat pneumonia and fungal infections. Genprobe Inc. has a market cap of $2.05 billion; its shares were traded at around $40.74 with a P/E ratio of 22.4 and P/S ratio of 4.3. Genprobe Inc. had an annual average earning growth of 10.7% over the past 5 years.
Highlight of Business Operations:
Product sales for the third quarter of 2009 were $119.0 million, compared to $108.3 million in the same period of the prior year, an increase of 10%. Total revenues for the third quarter of 2009 were $122.7 million, compared to $121.2 million in the same period of the prior year, an increase of 1%. Net income for the third quarter of 2009 was $22.2 million ($0.44 per diluted share), compared to $29.1 million ($0.53 per diluted share) in the same period of the prior year, a decrease of 24%.
Product sales for the first nine months of 2009 were $348.3 million, compared to $323.5 million in the same period of the prior year, an increase of 8%. Total revenues for the first nine months of 2009 were $359.4 million, compared to $363.6 million in the same period of the prior year, a decrease of 1%. Net income for the first nine months of 2009 was $67.8 million ($1.31 per diluted share), compared to $85.8 million ($1.56 per diluted share) in the same period of the prior year, a decrease of 21%.
Our total revenues, net income and fully diluted earnings per share in the first nine months of 2009 included $8.2 million of additional one-time revenue associated with the renegotiation of our collaboration agreement with Novartis, as well as Tepnel’s results of operations which were not included in the comparable prior year period. In contrast, the first nine months of 2008 included $16.4 million in royalty and license revenue associated with a third and final settlement payment from Bayer (now Siemens Healthcare Diagnostics) which was recorded in the first quarter of 2008, and a $10.0 million development milestone paid by Novartis, which was recorded in the third quarter of 2008.
In August 2008, our Board of Directors authorized the repurchase of up to $250.0 million of our common stock over the two years following adoption of the program, through negotiated or open market transactions. There is no minimum or maximum number of shares to be repurchased under the program. During the three months ended September 30, 2009, we repurchased and retired approximately 1,806,000 shares under this program at an average price of $38.35, or approximately $69.3 million in total. From its inception through September 30, 2009, we have repurchased and retired approximately 5,989,000 shares under this program at an average price of $41.72, or approximately $249.8 million in total. As a result, our stock repurchase program was substantially complete as of September 30, 2009.
As a result of our acquisition of Tepnel, we have a new category of product sales, which we refer to as “Research products and services.” These sales represent outsourcing services for pharmaceutical, biotechnology, and healthcare industries, including nucleic acid purification and analysis services, as well as the sale of monoclonal antibodies and food testing kits. These sales totaled $4.0 million and $7.6 million, respectively, for the three and nine months ended September 30, 2009.
Collaborative research revenue decreased 68% in the nine months ended September 30, 2009 compared to the same period of the prior year. This decrease was primarily due to a non-recurring $10.0 million milestone payment received from Novartis in the prior year period and $4.1 million of revenue received from 3M Corporation, or 3M, related to our healthcare-associated infection collaboration which ended in September 2008. These decreases were partially offset by increased reimbursements from Novartis for shared development expenses, primarily attributable to development efforts for the Panther instrument in the current year period.
GPRO is in the portfolios of Ron Baron of Baron Funds, Richard Aster Jr of Meridian Fund.
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