Post Earnings Coverage as Myriad’s Q2 Top-line Grew 2%; Topped Estimates

Upcoming AWS Coverage on INC Research Holdings Post-Earnings Results

LONDON, UK / ACCESSWIRE / February 27, 2017 / Active Wall St. announces its post-earnings coverage on Myriad Genetics, Inc. (NASDAQ: MYGN). The Company released its second quarter fiscal 2017 (Q2 FY17) results on February 07, 2017. The Salt Lake City-based Company’s total revenues reported a 2% y-o-y growth, outperforming market consensus estimates. Register with us now for your free membership at:

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One of Myriad Genetics’ competitors within the Research Services space, INC Research Holdings, Inc. (NASDAQ: INCR), announced on February 06, 2017, that it will release its Q4 and full year 2016 financial results on Tuesday, February 28, 2017, prior to its quarterly earnings call at 8:00 a.m. ET. AWS will be initiating a research report on INC Research in the coming days.

Today, AWS is promoting its earnings coverage on MYGN; touching on INCR. Get our free coverage by signing up to:

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Earnings Reviewed

In Q2 FY17, Myriad reported total revenues of $196.5 million, which came in above the $193.3 million reported in the year-ago same period. Total revenues numbers for the reported quarter beat market consensus estimates of $191 million. The year-over-year rise in the Company’s top-line was primarily due to sequential growth in hereditary cancer revenues and strong GeneSight results.

The molecular diagnostic Company posted GAAP net income of $5.9 million, or $0.09 per diluted share, in Q2 FY17 compared to $37.1 million, or $0.50 per diluted share, reported in Q2 FY16. The Company’s Q2 FY17 non-GAAP net income stood at $17.5 million, or $0.26 per diluted share, compared to $33.5 million, or $0.45 per diluted share, in the previous year’s comparable quarter. Wall Street had expected the Company to report non-GAAP net income of $0.24 per diluted share.

Operational Metrics

During Q2 FY17, Myriad’s gross profit came in at $152.1 million compared to $152.7 million in the prior year’s same quarter. However, the Company’s gross margin fell to 77.4% in Q2 FY17 from 79.0% in the year ago comparable quarter. The Company’s operating expenses increased to $138.9 million in Q2 FY17 from $107.5 million in Q2 FY16. Moreover, the Company’s operating income declined 71% during Q2 FY17 to $13.2 million from $45.2 million in Q2 FY16. The Company’s operating margin also fell to 6.7% of total revenues in Q2 FY17 from 23.4% of total revenues in the previous year’s corresponding quarter. In the reported quarter, non-GAAP operating income declined to $23.6 million, or 12.0% of total revenues, from $48.4 million, or 25.0% of total revenues, in the previous year’s same quarter.

Segment Results

During Q2 FY17, Molecular diagnostic tests reported total revenue of $183.9 million, up 1% from $182.6 million in Q2 FY16, primarily due to a 78% surged in EndoPredict testing revenues to $1.6 million and Prolaris testing revenues, which rose 63% to $3.1 million. However, in Q2 FY17, Hereditary cancer testing revenues fell 13% y-o-y to $143.9 million, Vectra DA testing revenues was down by 5% to $10.7 million, while other testing revenues remained flat at $2.9 million. Furthermore, the segment’s GeneSight testing revenue during the reported quarter stood at $21.7 million.

Additionally, Pharmaceutical and clinical service segment’s revenues rose 18% y-o-y during Q2 FY17 to $12.6 million.

Cash Flow and Balance Sheet

During Q2 FY17, Myriad reported GAAP cash flow from operations of $31.4 million compared to $40.9 million in the prior year’s comparable period. Furthermore, free cash flow during the reported quarter was $29.0 million versus $39.8 million in Q2 FY16. As on December 31, 2016, the Company had cash and cash equivalents balance of $108.1 million, compared to $68.5 million in as on June 30, 2016. Furthermore, the Company reported long-term debt balance of $204.0 million as on December 31, 2016.

Share Repurchase

During Q2 FY17, the Company bought back approximately 600,000 shares of its common stock, for $10 million and ended the quarter with approximately $161 million remaining under its share repurchase program.

Outlook

In its guidance for Q3 FY17, Myriad’s management expects revenues to be between $188 million and $190 million. For Q3 FY17, GAAP diluted EPS is projected to be in the range of $0.08 to $0.10, while adjusted EPS for the same period is forecasted to be in the range of $0.23 to $0.25.

For full year FY17, the Company anticipates revenue range of $745 million to $755 million. Additionally, GAAP diluted EPS for FY17 is forecasted to be between $0.31 and $0.36; whereas full year adjusted EPS is estimated to be in the range of $1.00 to $1.05.

Stock Performance

Myriad Genetics At the closing bell, on Friday, February 24, 2017, MYGN’s stock slightly slipped 0.37%, ending the trading session at $18.98. A total volume of 1.67 million shares were traded at the end of the day, which was higher than the 3-month average volume of 1.51 million shares. In the last month and previous three months, shares of the Company have surged 17.23% and 11.32%, respectively. Moreover, the stock rallied 13.86% since the start of the year. Shares of the company have a PE ratio of 19.08 and have a market capitalization of $1.30 billion.

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