Illumina reports eighth beat in a row, raises profit forecast

Reuters

* Q3 adj shr $0.45 vs est $0.40

* Q3 rev $357 mln vs est $343.6 mln

* Sees FY13 adj shr $1.75-$1.77 vs est $1.72

* Shares up 6 pct in aftermarket

By Adithya Venkatesan

Oct 21 (Reuters) - Gene sequencing products maker IlluminaInc's results beat analysts' estimates for the eighthstraight quarter, and the company forecast higher-than-expectedearnings for the year.

Illumina shares, which have almost doubled this year, wereup 7 percent at $87.20 in extended trading on Monday.

The company which gets its revenues from government fundingto academic laboratories, as well as R&D spending bypharmaceutical and biotechnology companies, said it does notexpect the recent U.S. government shutdown to have a materialimpact on spending patterns in the fourth quarter.

The company's gene sequencing devices help read more than 3billion "letters" in the human genetic code which can help intracking food-related pathogens like salmonella outbreaks andother genetic disorders.

"The world needs to do more and more sequencing... thedemand for sequencing over the next 5 years is going to beabsolutely enormous," chief executive Jay Flatley said in aconference call.

Illumina valued at about $10 billion, was subject of a $6.8billion takeover from Swiss drugmaker Roche Holding AG which fell apart in April last year.

San Diego-California based Illumina has been shopping sincethe failed takeover from Roche, buying Verinata Health Inc forabout $350 million to gain access to Verinta's non-invasivetests for detecting chromosomal abnormalities in a fetus.

Illumina which offers a variety of sequencing instruments,kits, and data analysis solution for analyzing DNA in animals,plants and human beings raised its adjusted earnings forecastfor the year to $1.75-$1.77 per share. Analysts were expecting aprofit of $1.72 per share.

Illumina's high-speed gene sequencer HiSeq 2500 can sequencethe entire genetic code in about 25 hours helping doctorsidentify genetic diseases quick enough to make importanttreatment decisions.

"Sales were strong across all geographic regions, anddespite the uncertainty in the academic funding environment,they've shipped more than 100 HiSeqs as they continue topenetrate commercial and translational customers with both theirhigh-end and desktop instruments," Maxim Group analyst BryanBrokmeier said.

Bryan who has a "hold" rating on the stock said the marketdisruption caused by Thermo Fisher Scientific Inc's pendingtakeover of Life Technolgies Corp has also benefittedIllumina's strong quarter.

Typically, genetic testing on newborns using conventionalmethods takes four to six weeks, long enough that the infant haseither died or been sent home.

The company, which has life sciences and diagnosticsdivisions, is in the process of a restructuring to expand intonewer markets and expects to keep the restructuring expenses tobe minimal, it said in a conference call.

Illumina will align its business into five units - lifesciences, reproductive and genetic health, oncology, enterpriseinformatics and emerging markets. The changes will be effectiveJan. 1.

Third-quarter net income rose to $31.4 million, or 22 centsper share, from $29.7 million, or 22 cents per share, a yearearlier.

Total revenue jumped 25 percent to $357 million.

Analysts on average had expected a profit of 40 cents pershare, according to Thomson Reuters I/B/E/S.

Rates

View Comments (0)