- First quarter revenue of $846.1 million decreased by 16% as reported with non-respiratory revenue up 5% on a supplemental combined basis (up 7% in constant currency) and respiratory revenue down 72% on a supplemental combined basis
- Growth in non-respiratory revenue for the first quarter was driven by the Labs business unit, primarily due to heightened instrument delivery and testing demand
- First quarter GAAP EPS of $0.73; adjusted EPS of $1.80, a 78% decrease from prior year on a supplemental combined basis, largely reflecting the strength of respiratory revenue in the first quarter of 2022
SAN DIEGO, CA - QuidelOrtho Corporation (NASDAQ: QDEL) (“QuidelOrtho”), a global provider of innovative in vitro diagnostic technologies designed for point-of-care settings, clinical labs and transfusion medicine, today announced financial results for the first quarter ended April 2, 2023.
The Company reported total revenue for the first quarter of 2023 of $846.1 million, compared to $1,002.3 million for the first quarter of 2022. GAAP diluted earnings per share (EPS) for the first quarter of 2023 decreased to $0.73, compared to $11.31 for the first quarter of 2022. GAAP operating income for the first quarter of 2023 was $99.6 million, compared to $620.7 million for the first quarter of 2022, and GAAP operating margin was 12% and 62% for the first quarters of 2023 and 2022, respectively. The first quarter 2023 results include significant one-time charges related to the integration.
In addition to the Company’s GAAP results, the Company is providing supplemental combined first quarter 2022 revenues and adjusted operating results as if Quidel Corporation (“Quidel”) and Ortho Clinical Diagnostics Holdings plc (“Ortho”) had been combined for the applicable periods. The following discussion of financial results is based on supplemental combined information:
First quarter 2023 total revenue of $846.1 million decreased by 44% in constant currency, compared to $1,502.4 million for the first quarter of 2022. Foreign currency translation negatively impacted sales growth by approximately 10 basis points for the first quarter of 2023. Adjusted diluted EPS for the first quarter of 2023 decreased to $1.80, compared to $8.03 for the first quarter of 2022. Adjusted EBITDA for the first quarter of 2023 was $245.3 million, compared to $780.8 million in the first quarter of 2022. Adjusted EBITDA margin for the first quarter of 2023 was 29.0%, compared to 52.0% for the first quarter of 2022.
“We’re off to an excellent start to the year with strong results across all geographic regions, double-digit growth in our Labs business, and better-than-expected Point of Care sales, demonstrating the power of our newly created scale and breadth of offerings across the diagnostics continuum,” said Douglas Bryant, President and Chief Executive Officer of QuidelOrtho. “The strength of our Labs business was particularly notable, with solid demand for both consumables and instruments, including standalone and integrated, as well as automation, setting us up for a stronger second half of the year.”
“With the integration on track and now entering the final phase, our macro headwinds dissipating, and demand across all geographies reaching normalized post-pandemic levels, we are focused on the execution of our key growth drivers and confident in our ability to deliver sustainable high-single-digit growth over the coming years,” Mr. Bryant concluded.
Conference Call Information
QuidelOrtho will hold a conference call today at 2:00 p.m. PT / 5:00 p.m. ET to discuss its financial results for the first quarter ended April 2, 2023. Interested parties can access the call on the “Events & Presentations” section of the “Investor Relations” page of the Company’s website at https://ir.quidelortho.com/. Presentation materials will also be posted to the “Events & Presentations” section of the “Investor Relations” page of the Company’s website at the time of the call. Those unable to access the webcast may join the call via phone by dialing 833-470-1428 (domestic) or 404-975-4839 (international) and entering Conference ID number 036290.
A replay of the conference call will be available shortly after the event on the “Investor Relations” page of the Company’s website, under the “Events & Presentations” section.
About QuidelOrtho Corporation
QuidelOrtho Corporation (Nasdaq: QDEL) unites the power of Quidel Corporation and Ortho Clinical Diagnostics behind a shared mission of developing and manufacturing innovative technologies that raise the performance of diagnostic testing and create better patient outcomes across the entire healthcare continuum.
Ranked among the world’s largest in vitro diagnostics (IVD) providers with more than 120 years of collective experience, we combine industry-leading expertise in immunoassay and molecular testing with a global footprint in clinical labs and transfusion medicine.
Our company’s comprehensive product portfolio delivers accuracy, speed, automation and access, providing critical information when and where it is needed most. Inspired by a spirit of service, QuidelOrtho is committed to enhancing the wellbeing of people worldwide and happy in the knowledge we are making a difference. For more information, please visit QuidelOrtho.com.
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include any statements contained herein that are not strictly historical, including, but not limited to, the benefits and results of the business combination of Quidel and Ortho (the “Combinations”) and integration of the businesses of Quidel and Ortho, and QuidelOrtho’s commercial, integration and other strategic goals, future financial and operating results, and future plans, objectives, strategies, expectations and intentions. These statements in this press release may be identified by words such as “may,” “will,” “would,” “should,” “might,” “expect,” “anticipate,” “believe,” “estimate,” “plan,” “intend,” “goal,” “project,” “strategy,” “future,” “continue” or similar words, expressions or the negative of such terms or other comparable terminology. Such statements are based on the beliefs and expectations of QuidelOrtho’s management as of today and are subject to significant known and unknown risks and uncertainties. Actual results or outcomes may differ significantly from those set forth or implied in the forward-looking statements. The following factors, among others, could cause actual results to differ from those set forth or implied in the forward-looking statements: the challenges and costs of integrating, restructuring and achieving anticipated synergies as a result of the Combinations; the ability to retain key employees; and other economic, business, competitive and/or regulatory factors affecting the business of QuidelOrtho generally. Additional risks and factors are identified under “Risk Factors” in QuidelOrtho’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “Commission”) on February 23, 2023 and subsequent reports filed with the Commission. You should not rely on forward-looking statements as predictions of future events because these statements are based on assumptions that may not come true and are speculative by their nature. QuidelOrtho undertakes no obligation to update any of the forward-looking information or time-sensitive information included in this press release, whether as a result of new information, future events, changed expectations or otherwise, except as required by law. All forward-looking statements are based on information currently available to QuidelOrtho and speak only as of the date hereof.
Supplemental Combined Financial Measures
This press release contains unaudited supplemental combined financial information (“Supplemental Combined Information”) that gives effect to the Combinations as if Quidel and Ortho had been combined for the applicable periods. Certain Supplemental Combined Information presented is based on the historical financial statements of Quidel and Ortho with reclassification adjustments only and do not include all of the pro forma adjustments required under Regulation S-X Article 11 or Accounting Standards Codification 805, Business Combinations (“ASC 805”). The Supplemental Combined Information is provided for illustrative purposes only, may be updated in the future, and is not necessarily, and should not be assumed to be, indicative of the Company’s expected results of operations or financial position that would have been achieved had the Combinations been completed as of the dates indicated or that may be achieved in any future period. The Supplemental Combined Information should be considered supplemental to, and not as a substitute for, pro forma financial information prepared in accordance with Regulation S-X Article 11 or ASC 805 and should be read in conjunction with the information contained in the sections entitled “The Combinations,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Ortho” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of Quidel” in QuidelOrtho’s joint proxy statement/prospectus (the “Joint Proxy Statement/Prospectus”) filed with the Commission on April 11, 2022 and the historical consolidated financial statements and related notes appearing elsewhere in, or incorporated into, the Joint Proxy Statement/Prospectus, and the Company’s subsequent reports filed with the Commission. The Company’s actual results of operations and financial position will differ, potentially significantly, from the Supplemental Combined Information reflected in this press release as a result of the methodology used to prepare the Supplemental Combined Information as well as a variety of factors, including but not limited to the effect of certain expected financial benefits of the Combinations (such as revenue and cost synergies), the anticipated costs to achieve these benefits (including the cost of integration activities), tax impacts, and changes in operating results following the date of this press release.
Non-GAAP Financial Measures
This press release contains financial measures, including but not limited to “constant currency” revenue changes, “adjusted net income,” “adjusted diluted EPS,” “adjusted EBITDA,” “adjusted EBITDA margin,” “supplemental combined adjusted net income,” “supplemental combined adjusted diluted EPS,” “supplemental combined adjusted EBITDA” and “supplemental combined adjusted EBITDA margin,” which are considered non-GAAP financial measures under applicable rules and regulations of the Commission. These non-GAAP financial measures should be considered supplemental to, and not a substitute for, financial information prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). “Adjusted net income,” “adjusted EBITDA” and “adjusted diluted EPS” eliminate impacts of certain non-cash, unusual or other items that the Company does not consider indicative of its ongoing operating performance, and the Company generally uses these non-GAAP financial measures to facilitate management’s financial and operational decision-making, including evaluation of the Company’s historical operating results and comparison to competitors’ operating results. The Company believes that “supplemental combined adjusted net income,” “supplemental combined adjusted diluted EPS,” “supplemental combined adjusted EBITDA” and “supplemental combined adjusted EBITDA margin” provide helpful Supplemental Combined Information to assist management and investors in evaluating the Company’s adjusted operating results as if Quidel and Ortho had been combined for the applicable periods. The Company’s definitions of these non-GAAP measures may differ from similarly titled measures used by others. These non-GAAP financial measures reflect an additional way of viewing aspects of the Company’s operations that, when viewed with GAAP results and the reconciliations to corresponding GAAP financial measures, may provide a more complete understanding of factors and trends affecting the Company’s business. Because non-GAAP financial measures exclude the effect of items that will increase or decrease the Company’s reported results of operations, management strongly encourages investors to review the Company’s consolidated financial statements and reports filed with the Commission in their entirety. Reconciliations of the non-GAAP financial measures, including the non-GAAP Supplemental Combined Information, to the most directly comparable GAAP financial measures are included in the tables accompanying this press release.