Myriad Genetics (MYGN) Beats Estimates

Myriad Genetics Inc. (MYGN) recorded an EPS of 54 cents in the fourth quarter of 2010, surpassing the Zacks Consensus Estimate of 33 cents and 24 cents in the year-ago period. For the full year 2010, the company recorded 79% growth in EPS to $1.54, beating the Zacks Consensus Estimate of $1.32 per share.

Results in the fourth quarter included a $14.6 million one-time income tax benefit as a result of recording a deferred tax asset and booking additional research and development tax credits. The results of the fourth quarter 2009 included a loss from discontinued operations of $13.1 million.

Myriad Genetics reported revenue of $93.9 million, up 9% compared with the year-ago quarter’s $86.1 million. However, revenues missed the Zacks Consensus Estimate of $94.0 million marginally. For 2010, revenues were $362.6 million, up 11.1% from 2009, while marginally beating the Zacks Consensus Estimate of $363.0 million.

The fourth quarter total revenue included a major contribution of $82.5 million from BRAC Analysis (comprehensive predictive medicine test for breast and ovarian cancer). The remaining $7.3 million came from Colaris and Colaris AP (predictive medicine test for hereditary colorectal endometrial cancer and uterine cancer) and $4.1 million from Other Products (Melaris, Theraguide 5-FU, OnDose, Prezeon, Prolaris, single site testing and license revenue).

Gross profit (representing 88% of revenue) increased 10.4% year over yearto $82.7 million in the fourth quarter 2010. Operating expenses increased 11.6% year over year during the quarter. The increase was driven by a 10% rise in selling, general and administrative expenses ($39.8 million) and a 20% increase in research and development (R&D) expenses ($5.3 million due to an increase in clinical studies conducted by the company for the molecular diagnostic products). Operating margin was consistent with the year-ago quarter at 40%.

Myriad Genetics generated cash flow from operations of $46 million in the fourth quarter 2010 and repurchased approximately 4% of the Company’s shares. The Company exited fiscal 2010 with cash and cash equivalents of $488.4 million, up 25% from $392.2 million at the end of June 2009.


For the fiscal 2011, Myriad Genetics expects the total revenue and EPS to be in the range of $380 million ─ $400 million and 95 cents─$1.00, respectively. Gross profit margin is expected to be 88% and tax rate is
expected to be 38%. For Fiscal 2011, the Company also expects to generate cash flow from operations of $170 million, up 10% from $155 million generated in fiscal 2010.

Myriad Genetics is a diagnostics company focused on the development and commercialization of novel molecular diagnostic products. The company aims to understand the relationship between genes and human diseases in order to develop the next generation of molecular diagnostic products.

MYRIAD GENETICS (MYGN): Free Stock Analysis Report

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