Abaxis third quarter revenues increase 32% to $49.8 million

Abaxis, Inc. (NasdaqGS: ABAX), a medical products company manufacturing point-of-care blood analysis systems, today reported financial results for the third fiscal quarter ended December 31, 2012.

Record quarterly highlights include:

• Revenues of $49.8 million, up 32% over last year's comparable quarter.
• North America revenues of $41.8 million, up 31% over last year's comparable quarter.
• Medical market revenues of $9.0 million, up 10% over last year's comparable quarter.
• Veterinary market revenues of $39.9 million, up 40% over last year's comparable quarter.
• Total medical and veterinary instrument revenues of $14.0 million, up 54% over last year's comparable quarter.
• Total medical and veterinary instrument sales of 1,818 units, up 52% over last year's comparable quarter.
• Total medical and veterinary reagent disc sales of $26.7 million, up 31% over last year's comparable quarter.
• Total medical and veterinary reagent disc sales of 2.1 million units, up 29% over last year's comparable quarter.

Other quarterly highlights include:

• International revenues of $8.0 million, up 33% over last year's comparable quarter.
• Service revenues from Abaxis Veterinary Reference Laboratories (AVRL) of $1.4 million, up 28% over the second quarter of fiscal 2013.
• Diluted net income per share of $0.22, compared to $0.13 per share for the same period last year.

Quarterly Results:  For the fiscal quarter ended December 31, 2012, Abaxis reported revenues of $49.8 million, as compared with revenues of $37.9 million for the comparable period last year, an increase of 32 percent.  Revenues from sales of instruments, which include chemistry analyzers, hematology instruments, VSpro specialty analyzers and i-STAT analyzers, increased by an aggregate of $4.9 million or 54 percent, over the same period last year.  Revenues from sales of consumables, which include reagent discs, hematology reagent kits, VSpro specialty cartridges, i-STAT cartridges and rapid tests, increased by an aggregate of $6.0 million, or 22 percent, over the same period last year.  Abaxis reported net income of $5.0 million for the fiscal quarter ended December 31, 2012, compared to $2.9 million for the same period last year, an increase of 75 percent.  Abaxis' effective tax rate in the quarter ended December 31, 2012 was 38 percent, compared to 37 percent for the same period last year.  Abaxis reported diluted net income per share of $0.22 (calculated based on 22,341,000 shares) for the three-month period ended December 31, 2012, compared to $0.13 per share (calculated based on 21,990,000 shares) for the same period last year. 

Nine-Month Results:  For the nine-month period ended December 31, 2012, Abaxis reported revenues of $136.1 million, as compared with revenues of $113.9 million for the comparable period last year, an increase of 19 percent.  Revenues from instrument sales increased by an aggregate of $10.1 million, or 40 percent, over the same period last year.  Revenues from consumables increased by an aggregate of $8.7 million, or 10 percent, over the same period last year.  The company reported net income of $20.8 million, including gain from the company's litigation settlement in the second quarter of fiscal 2013, compared to $8.4 million for the same period last year.  The company's effective tax rate in the nine-month period ended December 31, 2012, was 38 percent, compared to 37 percent for the same period last year.  The company reported diluted net income per share of $0.93 (calculated based on 22,316,000 shares) for the nine-month period ended December 31, 2012, compared to $0.37 per share (calculated based on 22,579,000 shares) for the same period last year. 

Other Reported Information:  Total sales in the medical market for the third quarter of fiscal 2013 were $9.0 million, an increase of 10 percent, compared to the same period last year.  Medical sales worldwide, excluding sales to the U.S. government, during the third quarter of fiscal 2013 were $8.6 million, an increase of 15 percent, compared to the same period last year.  Total sales in the veterinary market for the third quarter of fiscal 2013 were $39.9 million, an increase of 40 percent, compared to the same period last year.  Total medical and veterinary reagent disc sales for the third quarter of fiscal 2013 were $26.7 million, an increase of 31 percent compared to the same period last year.  Non-cash compensation expense recognized for share-based awards during the third quarter of fiscal 2013 was $1.8 million, compared to $1.5 million for the same period last year.  

On December 6, 2012, the company's Board of Directors declared a special cash dividend of $1.00 per share on the company's outstanding common stock.  The dividend payment totaling approximately $22.0 million was made on December 28, 2012.

Clint Severson, chairman and chief executive officer of Abaxis, said, "The financial results of the third quarter of fiscal 2013 were very strong.  We are steadily executing on our strategic plan to drive sales and net income, as total revenues increased 32% and net income increased 75%, compared to last year's third quarter.  Overall we achieved record quarterly reagent disc sales and instrument sales increased at solid double digit rates compared to third quarter of fiscal 2012.  We are particularly pleased and encouraged with the development of our working relationships with our two new distributors, Abbott Point of Care, Inc. and MWI Veterinary Supply, Inc.  These new distribution channels give us entry into markets to which we previously had very little access and expand the universe into which we can embed Abaxis technology.  While we are still in the early stages of working together, we are developing the necessary chemistry between our respective organizations that will ensure long-term success."

"We are also pleased with the progress achieved in the international markets during the quarter," continued Mr. Severson.  "Sales in both Europe and Asia continued to improve and grew at a 33% rate compared to last year's third quarter.  Although macroeconomic conditions throughout the world continue to be challenging, our dedication to building these markets during these most difficult times is beginning to bear real fruit.  All in all, we had a very solid quarter and we look to finish the year on a strong note in both our veterinary and medical markets."