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Edited Transcript of TRIB earnings conference call or presentation 19-Jul-18 3:00pm GMT

Q2 2018 Trinity Biotech PLC Earnings Call

Bray, Co Wicklow Jul 21, 2018 (Thomson StreetEvents) -- Edited Transcript of Trinity Biotech PLC earnings conference call or presentation Thursday, July 19, 2018 at 3:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Joe Diaz

* Kevin Tansley

Trinity Biotech plc - CFO, Secretary & Director

* Ronan O’Caoimh

Trinity Biotech plc - Co-Founder, Chairman and CEO

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Conference Call Participants

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* Elizabeth M. Lilly

* James Philip Sidoti

Sidoti & Company, LLC - Research Analyst

* Paul Nouri

Noble Equity Funds - Founder, MD, and Portfolio Manager

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Presentation

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Operator [1]

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Good day, and welcome to the Trinity Biotech Second Quarter and Fiscal Year 2018 Financial Results Conference Call. (Operator Instructions) Please note, this event is being me recorded.

I would now like to turn the conference over to Joe Diaz at Lytham Partners. Please go ahead.

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Joe Diaz, [2]

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Thank you, Brian, and thanks all of you for joining us today to review the financial results of Trinity Biotech for the second quarter of 2018, ended June 30, 2018. With us on the call representing the company are Ronan O’Caoimh, Chief Executive Officer; and Kevin Tansley, Chief Financial Officer. At the conclusion of today's prepared remarks, we'll open the call for a question-and-answer session.

But before we begin with those prepared remarks, we submit for the record the following statement: Statements made by the management team of Trinity Biotech during the course of this conference call that are not historical facts are considered to be forward-looking statements subject to risks and uncertainties. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for such forward-looking statements. The words believe, expect, anticipate, estimate, will and other similar statements of expectation identify those forward-looking statements. Investors are cautioned that such forward-looking statements involve risks and uncertainties including, but not limited to, the results of research and development efforts; the effect of regulation by the United States Food and Drug Administration and other agencies; the impact of competitive products; product development; commercialization and technological difficulties; and other risks detailed in the company's periodic reports filed with the Securities and Exchange Commission. Forward-looking statements reflect management's analysis only as of today. The company undertakes no obligation to publicly release the results of any revision to these forward-looking statements.

With that said, let me turn the call over to Kevin Tansley, Chief Financial Officer, for a review of the results. After Kevin's remarks, we will hear from Ronan O’Caoimh on his review of the quarter, after which we'll open the call for your questions. Kevin?

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Kevin Tansley, Trinity Biotech plc - CFO, Secretary & Director [3]

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Thank you, Joe. And today, I'll take you through the results for quarter 2, 2018. Beginning with our revenues. Total revenues for the quarter were $25 million, this compares to $25.4 million for quarter 2, 2017. Ronan will provide more details on revenues for the quarter later in the call, so I'll move on now and discuss the other aspects of the income statement. Our gross margin this quarter was 43.2%, which represents an improvement on the 42.5% achieved in quarter 2 last year. As you'll have noticed, part of this improvement was attributable to cost savings that we implemented during the quarter. I will say more about these savings later in the call.

I will point out that this quarter is marginally slightly lower than in quarter 1 of this year, but you might recall that in the last earnings call that I did point out that there are a variety of factors which impact our margin each quarter such as sales mix, currency and production levels and that we could expect some fluctuations in the quarters ahead, and this is what you're seeing here. What is important, however, is that overall this year's gross margin is over 1% ahead of where we were at this time last year, and we'll be looking to continue this trend throughout this year. I will now move on to our indirect costs.

Our R&D expenses increased slightly from $1.3 million to $1.4 million, whilst our SG&A expenses decreased slightly from $7.6 million to $7.4 million. Meanwhile, our share option expense increased from $100,000 to $300,000, and this was due to an unusually low charge in quarter 2 of last year. This factor alone, in fact, has resulted in the overall increase in our indirect costs this quarter from $9 million to $9.1 million. However, if you're to remove the impact of the share option increase, which is obviously noncash in nature, the remaining indirect costs would have actually fallen from $8.9 million to $8.4 million. Whilst this isn't a particularly large reduction in itself, it is worth pointing out that it arose due to cost-saving measures, which were undertaken during the quarter.

During the last number of months, we have carried out an extensive review of our cost base, and I am pleased to announce that we've identified close to $3 million of cost reductions.

Savings in question are made up of internal sundry costs and overheads as well as some third-party costs and will impact both the income statement and the balance sheet through reduced CapEx.

You're already seeing some of the impact of these savings through the improvement in SG&A as well as it being part of the reason why our gross margin improved this quarter. However, as the costs were only implemented part of the way through the quarter, the full effect will only be seen from quarter 3 onwards.

As you will have seen from our press release, these savings reflect our determination to achieve an overall cash flow neutral position for the financial year 2019.

Returning to the income statement, our operating profit for the quarter was $1.7 million, which is a slight reduction on the $1.8 million reported in quarter 2, 2017. This reduction is due to the increased share option charge I mentioned earlier as the impact of lower revenues was offset by the improved gross margin this quarter.

Our financial income for the quarter remained constant at $200,000, whilst our financial expenses for the quarter were just under $1.2 million, which is consistent with quarter 2 last year, and the vast majority of this relates to the cash interest element of the exchangeable notes.

The noncash financial expense of the quarter, which is disclosed further down the income statement was immaterial this quarter, and this was due to a gain of approximately $200,000 on the change in fair value of the derivatives embedded in the notes being effectively offset by noncash interest of approximately the same amount.

Our tax charge for the quarter was $158,000 and this reflects an effective rate of 9.2% of operating profits, which is a slight improvement compared to last year. The net result is that we earned a profit of $600,000 for the quarter.

Basic EPS, excluding noncash financing items for the quarter, was $0.029 compared to $0.031 in quarter 2, 2017. Meanwhile, fully diluted EPS was $0.067 for the quarter compared to $0.068 in the equivalent period last year. And diluted EPS for the first half of the year is close to $0.14 and this compares to $0.12 for the first half of last year.

Finally, on the income statement, earnings before interest, tax, depreciation, amortization and share option expense for the quarter was $2.9 million. I will now move on to talk about the significant balance sheet movements since the end of March 2018.

Property, plants and equipment increased by over $700,000 and this was due to additions of $1.3 million being offset by depreciation of $300,000 and retranslation movements of $300,000.

The same period, our intangible assets increased by $1.8 million and this was made up of additions of $2.4 million, offset by amortization of $600,000. Meanwhile, inventories for the quarter increased by just under 2% to $34.8 million and this was mainly due to seasonal factors.

Trade and other receivables have increased by $1 million to $23.1 million and this increase is due to the higher sequential revenues and a moderate increase in debtor days.

Meanwhile, our trade and other payables including both current and noncurrent have decreased from $22.2 million to $20.8 million and the majority of this decrease is attributable to the lower level of accrued interest on the company's exchangeable notes due to the semiannual timing of such payments.

Finally, I will discuss our cash flows for the quarter. Cash generated from operations for the quarter was $1.7 million and this was impacted by the increased inventory and debtor balances.

CapEx in the quarter was $3.9 million, which represents an increase over the same quarter last year, largely due to the timing of some equipment purchases.

Finally, there was a fixed monthly interest payment of $2.3 million in the quarter and the net result is that we had a decrease in cash for the quarter of approximately $4.5 million, bringing the quarter end balance to $49.4 million.

You will recall that earlier in the call, I referenced a determination to get to a cash flow breakeven position for 2019 and this was part of the rationale identifying the cost savings, which we are announcing today.

I do want to point out that we expect that our cash will drop somewhat between now and the end of the year as we have a number of cash outflows that we're required to address.

Firstly, we are addressing over 2 -- investing over $2 million in a new facility in Buffalo for our autoimmunity business.

This business has been growing consistently since we acquired it in 2013 with its revenues at the time of $12.5 million increasing to today's run rate of $20 million, and we plan to continue growing this significantly in the years ahead. Consequently, we need to invest in premises which can support this level of growth.

In addition, we have a number of what can be described as working capital items, such as the final payments in relation to our HIV-2 license, a settlement payment for the license dispute we announced in quarter 4 last year and a number of other historic obligations, which fall due in the second half this year. Finally, there will be some costs associated with implementing the savings program that I spoke of earlier on.

Taking all these payments into account and assuming a moderate level of growth between now and the end of the year, we estimate that our year-end cash balance will be of the order of $43 million plus or minus a million or so. At, which point, we will enter 2019, during which we expect to be cash neutral overall thus maintaining this cash balance.

I will now hand over to Ronan.

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [4]

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Thanks, Kevin. I'm going to review our revenues for quarter 2 before opening the call to the question-and-answer session. Our revenues for quarter 2 were $25 million compared with $25.4 million in the corresponding quarter last year, which is a reduction of 1.8%. Point-of-care revenues were $4 million compared with $4.35 million in the corresponding quarter last year, which is a decrease of 8%. Clinical Laboratory revenues were $21 million compared to $21.1 million in the corresponding quarter last year, which is a decrease of 0.6% or $100,000.

Moving back to point-of-care, our revenues decreased this quarter by 8% when compared with the corresponding quarter. Our U.S. HIV revenues decreased by 12%, and this is explained by the fact that public health spending in the U.S. on HIV testing continues to decrease.

In Africa, our HIV sales decreased by 7% when compared to the corresponding quarter. However, we do not believe that the market or indeed our market share has diminished, we believe that this movement is consistent with the haphazard nature of NGO purchasing.

Over the past 15 years, our Uni-Gold product has dominated the confirmatory HIV market in Africa with approximately 90% market share and during that time, we have not participated in any way in the much larger HIV screening market in Africa, a market that is at least 10x greater in volume terms.

Over the past 3 years, we have developed HIV screening product for the African market, which demonstrates performance characteristics that equal performance -- the performance of our Uni-Gold product and matches or exceeds the performance of the market leaders in African HIV screening. And the product is currently undergoing independent trials in the African market and will be submitted to the WHO for approval towards the end of this year.

We believe that we can take a significant share of the African HIV screening market, and given the quality of our products and our longstanding reputation for providing the gold standard confirmatory product to the market.

Moving on to clinical chemistry. Our revenues at $21 million were $100,000 left in the corresponding quarter or half of 1%, however, currency headwinds for the quarter approximated the same number of $100,000.

In Infectious Diseases, our revenues declined 11% compared with the corresponding quarter last year.

Approximately 50% or half of this reduction is explained by the gradual decline of our U.S. ELISA Infectious Diseases business, as the 5 biggest diagnostic companies continue to add more and more of our product offering onto the menu of their large immunoassay instruments.

The other 50% of the decline arises due to reduced Lyme confirmatory testing revenues, which arises due to the severe weather conditions experienced last winter.

Meanwhile, our diabetes and hemoglobin variant business performed strongly during the quarter, with revenues increasing 6%.

We had total instrument placements of 81 instruments during the quarter, and all of our principal markets performed strongly with the exception of Brazil, where we made modest placements during the quarter despite strong demand for the product. This arises due to the weakness of the Brazilian real, which in fact has continued to weaken. However, we have now completed the development of our new factory in Brazil and expect to be in production there by year-end following the receipt of the necessary regulatory approvals. At that point, savings that arise on import duties and sales taxes will enable us to recommence the placement of instruments into the Brazilian market.

Meanwhile, our premier resolution instruments, which serves the hemoglobin variants market for sickle cell anemia and thalassemia has performed strongly.

This is a high-value market with few competitors, and we believe that with our best-in-class instrument that we can take significant market share.

Moving then on to autoimmunity. This business performed well during the quarter with a 7% revenue increase.

The reference laboratory business has been the best-performing part of the business with significant growth coming from our Sjogren's test and from the growth of our business with the 2 U.S. mega labs. However, the great potential in our autoimmune business is in the product revenue side.

We believe that we have the best in class immunofluorescence product offering, which we continue to broaden.

During the quarter, we received 2 further FDA product approvals for HEp-2 DFS70, and also for our RNA polymerase III product.

However, in order to better leverage the quality of this product range, we are currently developing a new instrument. This instrument will be completed by the end of 2019 and is an automated integrated immunofluorescence processor and reader, which will eliminate the requirements for the use of microscopes in most instances.

We believe that the impact of this on our autoimmune business will be transformational.

I now hand back to Brian for a question-and-answer session.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question today comes from James Sidoti with Sidoti & Company.

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James Philip Sidoti, Sidoti & Company, LLC - Research Analyst [2]

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Can you repeat the -- how the diabetes business did in the quarter?

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [3]

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Yes. I said that it grew 6% and that we placed 81 instruments.

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James Philip Sidoti, Sidoti & Company, LLC - Research Analyst [4]

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Okay, great. And the screening -- the HIV screening test, is there any change from the last quarter or is that still on track?

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Kevin Tansley, Trinity Biotech plc - CFO, Secretary & Director [5]

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Still on track, more or less identical to before, and the African trial is close to completion. Submission to the WHO probably December, into the market hopefully February, March.

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James Philip Sidoti, Sidoti & Company, LLC - Research Analyst [6]

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Okay. And the Lyme disease, you indicated that weather was a factor in the quarter. Do you expect that business to bounce back in the third quarter?

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [7]

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Typically, if you actually have a hard winter, you have a slower start to the season, but you are -- basically incidents of Lyme in that year will be lower. So I think we're going to have a quiet season.

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James Philip Sidoti, Sidoti & Company, LLC - Research Analyst [8]

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Okay. Right. And then longer term, in the past calls you've indicated you think you can get back to mid-single digit revenue growth in '19. Do you still think that's reasonable?

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [9]

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Yes. Jim, absolutely. Yes.

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James Philip Sidoti, Sidoti & Company, LLC - Research Analyst [10]

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Okay. And it sounds like the cash burn will start to subside as well over the next couple of quarters so, by 2019, you expect to be a mid-single top line growth and then probably by 2020 to be a cash gainer? Is that...

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [11]

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Well, in fact, I mean, what we've done now is we've arrested our burn, and so basically, we are in a situation where we're satisfied that even at this level of sales with no growth in current levels that we would be at cash flow break even. So obviously, we expect to do a lot better than that and be cash flow positive. And when I say cash flow positive, I mean, I'm talking about everything, the interest, the capital payments. Kevin referenced the fact that we have -- we have to pay another $1 million to BIO-RAD, and we have various amounts to pay, but that's basically, they are just working capital movements, but we're taking them into account as well. So what we're saying is that even -- we have a couple of issues like that to pay off, and we also basically are completing the factory in Buffalo. But after the completion of those, we feel that we're basically all in, paying interest including capital work -- including all movements that there will be no reduction in our cash flows from the January 1, '19 and it would be about $40 million-- so we basically we'd bottom out at $43 million, and with anything over 2% growth, you'll see the cash flows improving.

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James Philip Sidoti, Sidoti & Company, LLC - Research Analyst [12]

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Okay. And then last question for me, you talked about the new instrument for the autoimmune business, can you tell me where you are now? Is that a prototype at this point? And how long do you think the approval process for that will be?

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [13]

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The approval process will be relatively short, I think that will be like 4 or 5 months with the FDA. So basically, we're a long way through it. I mean, we are 1.5 years into this project. We have sell through our partners, we have a hardware partner in Italy working on it with us, so we are well advanced. So we would -- it would take -- the kind of timelines we're giving will be fairly solid, we would expect by the end of '19 to be into the market.

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Operator [14]

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(Operator Instructions) Our next question comes from Paul Nouri with Noble Equity Funds.

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Paul Nouri, Noble Equity Funds - Founder, MD, and Portfolio Manager [15]

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On malaria, can you get into a little detail about the timing, and what you expect the competitive environment to be when you enter the market?

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [16]

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The timing is, is we probably expect not to be into the market until the start of 2020. By the time we perform the trials, finish the trials and submit to the WHO, get approval, and meanwhile also transfer production of the product out of our R&D facility in Carlsbad and move it into Ireland, and so all of that I think, makes it a 2020 product. I mean, the market is monstrous. I mean, just as by way of example, Nigeria used $120 million tests last year just that one country alone. So the market is huge, but it's a very, very price sensitive market, and so pricing is going to be in the $0.25 to $0.50 region typically, and that would compare with sort of HIV, where we're selling at $1.50 now, where the market leader screening is done at sort of $0.85 to $0.90. So it's an extremely price competitive market. And towards the higher level of the numbers I mentioned, we can operate at a modest profit. So it's -- what we do have, we believe, is the best product in market. We believe that we're just ahead probably of the market leader, but the market leader which was doing like sort of 150 million tests -- maybe somewhere 150 million to 200 million tests a year, is experiencing difficulty in terms of the pricing. So there's competition out there, out of India and China, very low cost off, in some instances not as great quality. It is taking the WHO time to kind of weed through them because what -- some of them would have had existing approvals. So basically pricing is an issue and a concern. So we would be operating at the kind of higher level of that market.

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Paul Nouri, Noble Equity Funds - Founder, MD, and Portfolio Manager [17]

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And then with the IFA instrument, what do you think the market size is for that?

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [18]

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Well, potentially the market for IFA instrumentation, you're talking about a market size of somewhere between $60 million and $80 million. It's -- potentially, I think, the size of the market. So very, very significant, dominated by the 2 market leaders, who would be Inova which is part of Werfen and BIO-RAD. And I believe that the integrated processor and reader that we're developing, would be significantly ahead of anything that either of those 2 competitors have at this time. So fundamentally what's happening largely at the moment is that when you're trying to diagnose things like Crohn's or celiac and lupus, and they're very tricky diagnoses, and that you typically end up with a doctor reading a microscope and making interpretations on it. And what this instrument is trying to do is basically trying to, in most cases, not all cases, eliminate the need for a doctor to actually make a reading himself, and so to automate that process. And so it's really out there, next-generation stuff, and I think it does say it can be transformational. There can be -- it can be a big game changer.

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Paul Nouri, Noble Equity Funds - Founder, MD, and Portfolio Manager [19]

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And I kind of tried to size your in-lab infectious disease market by looking at your presentation and taking out the other businesses. Is it about a $35 million business?

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Kevin Tansley, Trinity Biotech plc - CFO, Secretary & Director [20]

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No. Paul, it's way smaller than that, it's more like just barely over $20 million. By the way, it's good news because it's our problem child, it's a much smaller component of our overall business.

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Paul Nouri, Noble Equity Funds - Founder, MD, and Portfolio Manager [21]

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Yes, I mean, I guess, you knew that's where I was going with it. So over time, this business will be in decline. There's no new products updates that are going to stem the decline in this side of the business?

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [22]

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Not really. I mean, we do have a growing business in China, but I mean long term it's only a matter of time till the big immunoassay systems end up there as well. And so I mean, really the bottom line is that ELISA's days are really numbered, that's the bottom line, as more and more of the ELISA products menu is put onto the huge immunoassay systems. Just from a convenience point of view, reducing the number of vendors, reducing the number of instruments you have in your laboratory becomes more attractive for the labs to just to go with the big system. So if they have it -- they make a choice between kind of Roche, Abbot or Beckman and off they go. And so long term, ELISA's days are numbered, but it'll be a gradual decline. We felt we could contain it to 4%, 5% annually, that kind of thing.

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Paul Nouri, Noble Equity Funds - Founder, MD, and Portfolio Manager [23]

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Okay. And I mean, you've had the significant cash on your balance sheet for a while and haven't been able to make acquisitions in the past couple of years. Is there anything -- are you seeing any change in the market where multiples are becoming more reasonable on the private side? And if so, are you looking more towards labs because you've gotten into that a little bit, like a niche lab or still product based?

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [24]

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No, I mean, we don't see ourselves as a lab company at all. I mean, we're very much just a specialist reference laboratory for autoimmunity, that it kind of supports our product offering and whatever, but -- so we're very much not in the laboratory space. In terms of then, just in the general diagnostic space, I mean, broadly speaking, anything with -- exhibiting reasonable growth rates, and so anything approaching 10% is probably commanding a price of 4x revenue or even little bit more than that. So it's very hard to find value, but I think at this moment in time that we are also very conscious of the fact that we have a note out there, and so debt matures in 3 years and 8 months -- 9 months. And I think -- we -- so we're conscious of that as well and that -- and we're taking that equation into account as well, kind of cash balance versus note.

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Operator [25]

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The next question comes from Beth Lilly with Crocus Hill Partners.

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Elizabeth M. Lilly, [26]

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So I wanted to step back, and Jim Sidoti was asking a bunch of questions about the model. As we look out with the costs that you're taking out and the revenue growth that you hope to get in 2019, can you give us a sense Ronan, about what Trinity's business model looks like in terms of the financials, let's say 2 to 3 years from now. What -- we saw a little bit of gross margin expansion, but -- and you talk about getting to cash flow at breakeven -- but as you rejigger the cost structure and get the business growing again, on an operating basis, what do you think this business should be able to generate on an operating margin basis?

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [27]

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To answer your question another way, I would have said that basically, we believe now that we have with the cost cuts that we've made that basically we have achieved our -- literally on the cusp of achieving cash flow breakeven, and that we will have a cash balance of $43 million post basically the clearance of some creditors like BIO-RAD's HIV license and the completion of the Buffalo -- new Buffalo factory. And we believe that basically at a $99 million revenue basically is that we have that breakeven, and then any movement, any increase, every million dollars in excess of that amount, will give rise to probably $0.5 million of extra cash, and of course the same with our -- would be in the reverse. Now what we believe is that we had indicated that we would do low single-digit growth this year, but that we would do significantly better next year. So in that context, we would see our cash balance increasing through '19 and beyond.

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Elizabeth M. Lilly, [28]

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Okay. But what about your margin structure? As you look out, what's your goal in terms of operating margins or EBITDA margins for this business in 2 to 3 years?

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Kevin Tansley, Trinity Biotech plc - CFO, Secretary & Director [29]

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Yes. Beth, I mean, you're seeing a couple of things going on at the moment. Obviously, the fact that our gross margin is improving, the fact that we are keeping a sort of lid on our indirect costs that puts us in a good position to take advantage of any top line growth. As Ronan has referenced already, a lot of that is going to drop to the operating profit line pretty quickly. At the moment, we're kind of in the sort of the 7% range, we'd be ambitious to get up to the double digits which would be 10% in terms of operating margin. And then after that increasing thereafter. Obviously a lot will depend on where the top line ends up going, the extent to which we're for example, successful in relation to the HIV screening market penetration that we're planning, and growth in other areas. So you could quickly see us going from what will be low double digits, 10%, traveling up to the 12%, 13%, 14% depending how quickly that top line growth occurs, but the key number is what the revenues will be because of the factor Ronan referenced there, the speed at which it drops to the operating profit line and operating margin we've very much linked. So it's hard to discuss the 2 in isolation of each other, but in the shorter term, we'll be looking at getting -- try and get to the 10% and then moving beyond that again.

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Elizabeth M. Lilly, [30]

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Okay. So shorter term meaning 2 years?

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Kevin Tansley, Trinity Biotech plc - CFO, Secretary & Director [31]

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At some stage next year hopefully, towards the end of next year maybe, but certainly within 2 years.

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Elizabeth M. Lilly, [32]

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Okay. Okay. And then would you remind us about that debt? So when can you -- what's your intention in terms of the senior notes? Can you pay those off?

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [33]

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I don't think we're really in a position to -- Beth -- really to give a definitive determination on that at this moment.

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Elizabeth M. Lilly, [34]

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While the cash will start -- the cash is going to continue to build, if you are able to execute on the strategy and start to grow the top line and keep cash flow breakeven. So it seems to me that would be a good use of the cash.

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [35]

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Yes. I mean, I think, yes, I think, you're probably right there, and I think our strategy at this moment of time is when the note -- the note can be called in in 3 years 9 months, and we're very conscious of that. I mean, I think, our strategy at this moment of time is to arrest, to stop the decline in cash -- in our cash balances, to increase that cash balance to basically demonstrate strong growth, to move from low single-digit growth into double-digit growth, and presumably as that happens, basically the 2 strengthen our share price. And I think in those circumstances, with an enhanced cash balance and a stronger share price, I think we can address the issue of the note, in advance of it -- of its call date. I think beyond that, it's -- I think that's enough to say on it.

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Ronan O’Caoimh, Trinity Biotech plc - Co-Founder, Chairman and CEO [36]

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We don't appear to have any more questions. So if I could just say, thank you very much to everybody for your participation and support and we'll talk to you next quarter.

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Kevin Tansley, Trinity Biotech plc - CFO, Secretary & Director [37]

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Thank you.

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Operator [38]

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The conference is now concluded. Thank you very much for attending today's presentation. You may now disconnect your lines.