NeoGenomics Reports Record Revenue of $16.9 Million, Adjusted EBITDA of $2.2 Million and Net Income of $900K for the Third Quarter 2013 PR Newswire FT. MYERS, Fla., Oct. 23, 2013 FT. MYERS, Fla., Oct. 23, 2013 /PRNewswire/ --NeoGenomics, Inc. (NASDAQ: NEO), a leading provider of cancer-focused genetic testing services today reported its results for the third quarter of 2013. Third Quarter 2013 Highlights: oRevenue growth of 18.9% oTest volume growth of 19.1% oGross Profit Margin of 48.4% versus 41.5% last year oAdjusted EBITDA^(1) growth of 157% oNet Income of $0.02 per share versus a loss of $0.02 last year Revenue for the third quarter was $16.9 million, an 18.9% increase from third quarter 2012 revenue.Test volume increased by 19.1% year over year, while average revenue per test was largely unchanged. Average cost of goods sold per test declined by 12% as a result of continued productivity improvements, increased leverage from higher volumes, and other cost containment initiatives. As a result, gross profit increased by 38.7% from the prior year. Total operating expenses increased by 6.6% from last year's third quarter, primarily as a result of additional sales representatives and increases in billing and information technology expenses. This was partially offset by a decrease in stock compensation expenses related to the decline in the Company's stock price for the quarter. Net income for the quarter was $900,000, or $0.02 per share, versus a net loss of $(975,000), or $(0.02) per share, in last year's third quarter.Adjusted EBITDA^(1) improved by 157% to $2.2 million for the quarter from $842,000 last year. Douglas M. VanOort, the Company's Chairman and CEO commented, "We are pleased with our third quarter results. Solid growth in test volume was driven by continued success with new products and growth in the number of customer accounts.The productivity of our sales team improved with gains in all geographic territories across the country.In addition, we have added five sales representatives and two product managers since the end of the second quarter to further accelerate growth." Mr. VanOort continued, "We continued to improve productivity and increase our efficiency and effectiveness during the quarter. As a result, we realized strong reductions in average cost-per-test, which allowed us to drive 85% of the incremental $2.7 million of revenue to gross profit. We are in the process of redesigning and expanding our Fort Myers, Florida laboratory to incorporate lean workflow concepts and improved automation. We expect this new lab to be complete in the first quarter of 2014 and believe it will yield further process improvements." Mr. VanOort added, "As a result of our strategic focus on innovation and new product development, NeoGenomics is increasingly being recognized as a leader in cancer testing in this era of 'precision medicine'. We have now introduced over 30 new Molecular tests and profiles to our menu since the beginning of 2013 and we expect to launch several more tests and next generation sequencing for clinical use by early 2014. We believe we now have the broadest oncology-focused clinical testing menu in the country, and we are beginning to see increasing interest in our comprehensive genetic capabilities from the pharmaceutical industry." Fourth Quarter and Full-Year 2013 Financial Outlook: We expect revenue of $17.6-$18.1 million and earnings of $0.01 to $0.02 per share in Quarter 4. For the full year 2013, we expect revenue to be $65.7-$66.2 million with earnings per share of $0.03 to $0.04. The Company reserves the right to adjust this guidance at any time based on the ongoing execution of its business plan. Current and prospective investors are encouraged to perform their own due diligence before buying or selling any of the Company's securities, and are reminded that the foregoing estimates should not be construed as a guarantee of future performance. ____________________ (1) Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, amortization, non-recurring moving expense for the move of our facility in Irvine, California in 2012, and non-cash stock-based compensation expenses. See table for a reconciliation to net income. Conference Call The Company has scheduled a web-cast and conference call to discuss their Q3 2013 results on Wednesday October 23, 2013 at 11:00 AM EDT. Interested investors should dial (877) 407-8035 (domestic) and (201) 689-8035 (international) at least five minutes prior to the call and ask for Conference ID Number 10000554. A replay of the conference call will be available until 11:59 PM on November 6, 2013 and can be accessed by dialing (877) 660-6853 (domestic) and (201) 612-7415 (international). The playback conference ID Number is 10000554. The web-cast may be accessed under the Investor Relations section of our website at www.neogenomics.com or http://www.investorcalendar.com/IC/CEPage.asp?ID=171755. An archive of the web-cast will be available until 11:59 PM on January 23, 2014. About NeoGenomics, Inc. NeoGenomics, Inc. is a high-complexity CLIA–certified clinical laboratory that specializes in cancer genetics diagnostic testing, the fastest growing segment of the laboratory industry. The company's testing services include cytogenetics, fluorescence in-situ hybridization (FISH), flow cytometry, immunohistochemistry, anatomic pathology and molecular genetic testing. Headquartered in Fort Myers, FL, NeoGenomics has labs in Nashville, TN, Irvine, CA, Tampa, FL and Fort Myers, FL. NeoGenomics services the needs of pathologists, oncologists, pharmaceutical firms, other clinicians and hospitals throughout the United States. For additional information about NeoGenomics, visit http://www.neogenomics.com. Interested parties can also access investor relations material from Hawk Associates at http://www.hawkassociates.com or firstname.lastname@example.org and from Zack's Investment Research at http://www.zacks.com or email@example.com. Forward Looking Statements Except for historical information, all of the statements, expectations and assumptions contained in the foregoing are forward-looking statements. These forward looking statements involve a number of risks and uncertainties that could cause actual future results to differ materially from those anticipated in the forward looking statements, Actual results could differ materially from such statements expressed or implied herein. Factors that might cause such a difference include, among others, the company's ability to continue gaining new customers, offer new types of tests, and otherwise implement its business plan. As a result, this press release should be read in conjunction with the company's periodic filings with the SEC. NeoGenomics, Inc. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited, in thousands) ASSETS September 30, December 31, 2013 2012 Cash, cash equivalents $ 4,929 $ 1,868 Accounts Receivable (net of allowance for doubtful 15,727 14,034 accounts of $4,355 and $3,002, respectively) Other Current Assets 3,171 2,679 TOTAL CURRENT ASSETS 23,827 18,581 PROPERTY AND EQUIPMENT (net of accumulated 8,592 8,607 depreciation of $13,404 and $10,289, respectively) INTANGIBLE ASSETS (net of accumulated amortization 2,633 2,800 of $349 and $182, respectively) OTHER ASSETS 178 83 TOTAL $ 35,230 $ 30,071 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES $ 12,246 $ 17,758 LONG TERM LIABILITIES 2,657 3,097 TOTAL LIABILITIES 14,903 20,855 STOCKHOLDERS' EQUITY 20,327 9,216 TOTAL $ 35,230 $ 30,071 NeoGenomics, Inc. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (unaudited) For the Nine-Months For the Three-Months Ended Ended September 30, September 30, 2013 2012 2013 2012 NET REVENUE $ 16,884 $ 14,202 $ 48,144 $ 44,973 COST OF REVENUE 8,713 8,310 25,570 24,571 GROSS PROFIT 8,171 5,892 22,574 20,402 OPERATING EXPENSES General and administrative 4,335 3,929 12,573 11,745 Research and development 340 808 1,791 1,833 Sales and marketing 2,336 1,839 6,239 5,809 Total operating expenses 7,011 6,576 20,603 19,387 INCOME (LOSS) FROM 1,160 (684) 1,971 1,015 OPERATIONS INTEREST AND OTHER (231) (291) (749) (837) INCOME (EXPENSE) - NET INCOME (LOSS) BEFORE 929 (975) 1,222 178 TAXES INCOME TAXES 29 - 46 - NET INCOME (LOSS) $ 900 $ (975) $ 1,176 $ 178 NET INCOME (LOSS) PER SHARE $ 0.02 $ (0.02) $ 0.02 $ 0.00 - Basic - Diluted $ 0.02 $ (0.02) $ 0.02 $ 0.00 WEIGHTED AVG NUMBER OF SHARES OUTSTANDING 48,933 45,175 48,007 44,944 - Basic - Diluted 53,173 45,175 52,599 48,226 NeoGenomics, Inc. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited, in thousands) For the For the Nine Nine Months Months Ended Ended September September 30, 2013 30, 2012 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES $ 2,732 $ (493) NET CASH USED IN INVESTING ACTIVITIES (1,486) (3,300) NET CASH PROVIDED BY FINANCING ACTIVITIES 1,815 3,203 NET INCREASE (DECREASE) IN CASH AND CASH 3,061 (590) EQUIVALENTS CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 1,868 2,628 CASH AND CASH EQUIVALENTS, END OF PERIOD $ 4,929 $ 2,038 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Interest paid $ 715 $ 809 Income taxes paid $ 19 $ - SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: Purchase of licenses $ - $ 1,945 Equipment leased under capital lease and $ 1,815 $ 2,845 equipment loans NeoGenomics, Inc. RECONCILIATION OF GAAP NET INCOME TO NON-GAAP EBITDA AND ADJUSTED EBITDA (Unaudited, in thousands) For the Three-Months For the Nine-Months Ended September 30, Ended September 30, 2013 2012 2013 2012 Net income (loss) (Per GAAP) $ 900 $ (975) $ 1,176 $ 178 Adjustments to Net Income (Loss): Interest expense (income), net 231 291 749 837 Amortization of intangibles 56 56 168 126 Income tax expense 29 - 46 - Depreciation 1,063 944 3,114 2,549 EBITDA 2,279 316 5,253 3,690 Further Adjustments to EBITDA: Non-recurring costs - 170 - 170 Non-cash stock-based (116) 356 530 699 compensation Adjusted EBITDA (non-GAAP) $ 2,163 $ 842 $ 5,783 $ 4,559 Non – GAAP Adjusted EBITDA Definition "Adjusted EBITDA" is defined by NeoGenomics as net income from continuing operations before (i) interest expense, (ii) tax expense, (iii) depreciation and amortization expense, (iv) non-cash stock-based compensation and warrant amortization expense and (v) other extraordinary or non-recurring charges. NeoGenomics believes that Adjusted EBITDA provides a more consistent measurement of operating performance and trends across reporting periods by excluding these cash and non-cash items of expense not directly related to ongoing operations from income. Adjusted EBITDA also assists investors in performing analysis that is consistent with financial models developed by research analysts. Adjusted EBITDA as defined by NeoGenomics is not a measurement under GAAP and may differ from non-GAAP measures used by other companies. There are limitations inherent in non-GAAP financial measures such as Adjusted EBITDA because they exclude a variety of charges and credits that are required to be included in a GAAP presentation, and do not therefore present the full measure of NeoGenomics recorded costs against its net revenue. Accordingly, investors should consider non-GAAP results together with GAAP results in analyzing NeoGenomics financial performance. NeoGenomics, Inc. Supplemental Information on Customer Requisitions Received and Tests Performed (Unaudited, in thousands, except test and requisition data) For the For the For the For the Three-Months Three-Months Nine-Months Nine-Months Ended Ended % Inc Ended Ended % Inc (Dec) (Dec) September September 30, September September 30, 2012 30, 30, 2013 2013 2012 Requisitions Rec'd 21,737 18,307 18.7% 63,216 53,802 17.5% (cases) Number of Tests 33,723 28,315 19.1% 98,330 84,093 16.9% Performed Avg. # of Tests / 1.55 1.55 0.3% 1.56 1.56 (0.5)% Requisition Total Testing $ 16,884 $ 14,202 18.9% $ 48,144 $ 44,973 7.0% Revenue Avg. $ 777 $776 0.1% $ 762 $ 836 (8.9)% Revenue/Requisition Avg. Revenue/Test $ 501 $ 502 (0.2)% $ 490 $ 535 (8.5)% Total Cost of $ 8,713 $ 8,310 4.8% $ 25,570 $ 24,571 4.1% Revenue Avg. $ 401 $ 454 (11.7)% $ 404 $ 457 (11.6)% Cost/Requisition Avg. Cost/Test $ 258 $ 293 (11.9)% $ 260 $ 292 (11.0)% SOURCE NeoGenomics, Inc. Website: http://www.neogenomics.com Contact: NeoGenomics, Inc., Steven C. Jones, Director of Investor Relations, (239) 325-2001, firstname.lastname@example.org; Hawk Associates, Inc., Ms. Julie Marshall, (305) 451-1888, email@example.com
NeoGenomics Reports Record Revenue of $16.9 Million, Adjusted EBITDA of $2.2 Million and Net Income of $900K for the Third
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