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IRIS International Inc. Reports Operating Results (10-Q)

August 06, 2010 | About:
10qk

10qk

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IRIS International Inc. (IRIS) filed Quarterly Report for the period ended 2010-06-30.

Iris International Inc. has a market cap of $168 million; its shares were traded at around $9.2 with a P/E ratio of 24.8 and P/S ratio of 1.8. Iris International Inc. had an annual average earning growth of 14.1% over the past 5 years.IRIS is in the portfolios of Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Consolidated revenues for the second quarter of 2010 increased 19% to $26.7 million as compared to $22.3 million in the prior year period. IVD urinalysis segment revenues increased 19% to $22.8 million in the second quarter of 2010 as compared to $19.1 million in the prior year quarter. IVD instruments revenues increased 20% to $7.4 million in the second quarter of 2010 as compared to $6.2 million in the prior year quarter. The increase in IVD instrument sales is primarily driven by strong domestic sales versus a year ago as we have experienced an improvement in the U.S. medical capital equipment environment. Although we had strong international sales in the first half of 2010, we are anticipating softness in the European market mainly due to fiscal and monetary issues and the decline of the Euro as our distributors pay us in U.S. dollars.

Marketing and selling expenses increased to $4.8 million, or 18% of revenues, in the second quarter of 2010 as compared to $3.9 million, or 18% of revenues, for the second quarter 2009. The increase in expense is due to additional personnel and related costs of $427,000, higher commissions and GPO fees of $210,000 and increased travel and entertainment expenses of $189,000. The increase in personnel and related costs, including travel expenses, primarily results from the initiation of direct sales in the United Kingdom and Germany in order to support the long-term commercial strategy of our business. We expect to continue to invest in these areas to strengthen our global presence and support for the anticipated launches of our extensive product pipeline.

General and administrative expenses increased to $4.6 million, or 17% of revenues, in the second quarter of 2010 as compared to $3.4 million, or 15% of revenues, in the second quarter of 2009. The increase includes CFO severance and related transition expenses of $381,000, personnel and related costs from additions in IT, quality assurance and regulatory affairs of $437,000, recruiting and relocation expense of $128,000 and AlliedPath related acquisition expenses of $321,000.

Consolidated revenues for the first half of 2010 increased 20% to $52.7 million as compared to $43.9 million in the prior year period. IVD urinalysis segment revenues increased 22% to $45.0 million in the first half of 2010 as compared to $37.0 million in the prior year period. IVD instruments revenues increased 32% to $15.3 million as compared to $11.6 million during the prior year period. IVD consumables and service revenue increased to $29.7 million in the first half of 2010 as compared to $25.4 million, an increase of 17% over the prior year period. Revenues for our Sample Processing segment for the first half of 2010 increased 11% to $7.7 million as compared to $6.9 million in the prior year period. The increase is primarily attributable to increased sales of components and spare parts to OEM partners such as Abbott and IDEXX, the sales ramp of our new Ovatube fecal parasite specimen collection and processing device, partially offset by lower international sales through distributors.

Marketing and selling expenses totaled $9.2 million, or 17% of revenue, for the first half of 2010, as compared to $7.8 million, or 18% of revenue, for the prior year period. The increase includes additional personnel and related expenses of $848,000, travel related expenses of $249,000 from the initiation of direct sales in the UK and Germany, and commissions and GPO fees of $275,000 on higher revenues.

General and administrative expenses increased for the first half of 2010 to $8.3 million, or 16% of revenue, as compared to $6.5 million for the prior year period, or 15% of revenue. The increase includes CFO severance and related transition expenses of $381,000, personnel and related costs from additions in IT, quality assurance and regulatory affairs of $795,000, recruiting and relocation expenses of $217,000 and AlliedPath related acquisition expenses of $364,000.

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