Quidel reports first quarter 2021 financial results

Quidel Corporation (NASDAQ: QDEL), a provider of rapid diagnostic testing solutions, cellular-based virology assays and molecular diagnostic systems, announced today financial results for the first quarter ended March 31, 2021.

First Quarter 2021 Highlights

• Total revenue increased 115% to $375.3 million, from $174.7 million in the first quarter of 2020.
• Total sales of COVID-19 products were $280.3 million, as compared to $1.0 million in the first quarter of 2020.
• Total sales of Influenza products were $5.2 million, as compared to $79.6 million in the first quarter of 2020.
• Cardiometabolic Immunoassay sales increased 23% to $66.6 million.
• Reported GAAP EPS of $4.09 per diluted share in the first quarter of 2021, as compared to $0.93 per diluted share in the first quarter of 2020.
• Reported non-GAAP EPS of $4.38 per diluted share in the first quarter of 2021, as compared to $1.22 per diluted share in the first quarter of 2020.
• Received EUA from the FDA for QuickVue® At-Home COVID-19 Test for prescription use and for QuickVue® At-Home OTC COVID-19 Test for serial at-home use without prescription and among asymptomatic persons.

First Quarter 2021 Results
Total revenue for the first quarter of 2021 was $375.3 million, versus $174.7 million for the first quarter of 2020. The 115% increase in sales from the first quarter of 2020 was driven by growth in Rapid Immunoassay and Molecular Diagnostic Solutions product categories, the result of strong demand for both rapid antigen and PCR COVID-19 tests. To a lesser extent, growth also came from our Cardiometabolic Immunoassay products. Revenue growth in the quarter was minimally offset by a decline in Specialized Diagnostic Solutions revenues. Currency exchange had a favorable impact of $2.1 million. Excluding COVID-19 and influenza products, revenue for the core business was $89.9 million, as compared to $94.1 million in the first quarter of 2020.

Rapid Immunoassay product revenue increased by $141.7 million in the first quarter of 2021 to $237.7 million, primarily due to $212.1 million in revenue for our Sofia® SARS Antigen test. Cardiometabolic Immunoassay revenue totaled $66.6 million in the first quarter of 2021, an increase of 23% from the first quarter of 2020. Molecular Diagnostic Solutions revenue increased $51.9 million to $60.3 million mostly due to sales of Lyra® PCR assays for COVID-19 diagnosis, as well as, to a lesser extent, sales of Solana® SARS-CoV-2 assays. Specialized Diagnostic Solutions revenue decreased 34% from the first quarter of 2020 to $10.9 million, driven by lower demand for respiratory testing.

“The first quarter of 2021 was both a commercial and operational success, as well as a foundation forming period for the transformational opportunities in the quarters and years ahead. Our team continued to deliver extraordinary performance with the introduction of breakthrough new products, expanded manufacturing capabilities, regulatory approvals and capital discipline. As a result, we delivered a 115% increase in revenues and an approximately 340% increase in net income and earnings per share year-over-year,” said Douglas Bryant, president and CEO of Quidel Corporation.

“We see tremendous opportunities ahead to leverage our rapidly expanding installed base of Sofia® analyzers leveraging the exponential rise of telemedicine to drive sales of our full array of Sofia® assays for flu, Strep and a host of other conditions. In addition, late in the quarter, we received pathbreaking EUAs from the FDA for serial screening with our Sofia® SARS and QuickVue® At-Home OTC COVID-19 Test technologies, which we believe represents a regulatory shift that extends well beyond the immediate addressable markets for OTC at-home and re-opening testing,” Mr. Bryant continued.

“Looking ahead, Quidel is exceptionally well positioned to grow its share across multiple platforms and channels. We are poised to introduce Savanna®, a multiplex molecular analyzer that enables professional customers to analyze up to 12 pathogens or targets, plus controls, in a single assay run in less than 25 minutes, which promises to disrupt and decentralize multiplex molecular testing. Further, we recently established crucial strategic partnerships with global distribution and retail leaders including McKesson and Walgreens that will give us unprecedented exposure to the OTC segment and fulfillment pathways to serve employers seeking a path to safely re-opening. Taken together, this powerful mix of products, partnerships and macro trends provide an exciting roadmap for Quidel’s continued growth and success in advancing diagnostics to improve human health,” Mr. Bryant concluded.

Gross Profit in the first quarter of 2021 increased by 163% from the first quarter of 2020 to $302.0 million, driven by the demand for both rapid antigen and molecular COVID-19 products. Increased spend, required to expedite the production ramp, was offset by higher absorption related to the increased production volumes. Gross margin improvement versus last year was due to the same factors. R&D expense increased by $6.9 million in the first quarter as compared to the same period last year, due primarily to increased spending on the Savanna instrument development project. We also incurred incremental labor and material costs associated with COVID-19 product development. Sales and Marketing expense increased by $3.5 million in the quarter, due primarily to higher compensation costs driven by increased headcount as well as product promotions. This was partially offset by reduced travel, meeting and trade show costs due to the COVID-19 travel restrictions. G&A expense increased by $5.2 million in the quarter due to higher compensation costs. Acquisition and integration costs of $0.7 million and $1.9 million for the three months ended March 31, 2021 and 2020, respectively, primarily related to the evaluation of new business development opportunities.

In the first quarter of 2021, the Company recorded an income tax expense of $43.7 million, as compared with $8.6 million in the same quarter last year. The higher tax expense for the three months ended March 31, 2021 as compared to the same period in the prior year is a result of higher pre-tax profits.

Net income for the first quarter was $178.1 million, or $4.09 per diluted share, as compared to a net income of $40.2 million, or $0.93 per diluted share, for the first quarter of 2020. On a non-GAAP basis, net income for the first quarter of 2021 was $190.5 million, or $4.38 per diluted share, as compared to net income of $52.7 million, or $1.22 per diluted share, for the same period in 2020.

Non-GAAP Financial Information
The Company is providing non-GAAP financial information to exclude the effect of stock-based compensation, amortization of intangibles, non-cash interest expense, foreign exchange gains and losses and certain non-recurring items on net income and earnings per share as a supplement to its consolidated financial statements, which are presented in accordance with generally accepted accounting principles in the U.S., or GAAP.

Management is providing the adjusted gross profit, adjusted operating income, adjusted net income, adjusted net earnings per share, and constant currency revenue information for the periods presented because it believes this enhances the comparison of the Company’s financial performance from period-to-period, and to that of its competitors. Constant currency revenue is calculated by translating current period revenues using prior period exchange rates, net of any hedging effect recognized in the current period. Constant currency revenue growth (expressed as a percentage) is calculated by determining the change in current period constant currency revenues over prior period revenues. This press release is not meant to be considered in isolation, or as a substitute for results prepared in accordance with GAAP. A reconciliation of the non-GAAP financial measures to the comparable GAAP measures is included in this press release as part of the attached financial tables.

Conference Call Information
Quidel management will host a conference call to discuss the first quarter 2021 results as well as other business matters today beginning at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time). During the conference call, management may answer questions concerning business and financial developments and trends. Quidel’s responses to these questions, as well as other matters discussed during the conference call, may contain or constitute material information that has not been previously disclosed. Business Wire