QIAGEN exceeds outlook for Q4 2023, led by 8% CER sales growth in non-COVID products and improved operational profitability

Rhea-AI Summary

QIAGEN N.V. (NYSE: QGEN) reported Q4 2023 net sales of $509 million (+2% actual rates, +1% constant exchange rates, CER) and diluted EPS of $0.42, with an adjusted diluted EPS of $0.55. The company achieved its FY 2023 outlook for at least $1.97 billion CER sales and at least $2.07 CER adj. EPS, with 8% CER sales growth in the non-COVID portfolio and 27% adj. operating income margin. The 2024 outlook includes at least $2.0 billion CER net sales and adj. diluted EPS of at least $2.10 CER, reflecting adj. operating income margin gains but significant non-operating income pressure.

Insights

Financial Analyst

The reported financial results from QIAGEN N.V. for Q4 2023 and the full year of 2023 demonstrate resilience in their non-COVID-19 portfolio with an 8% CER sales growth, which is a strong indicator of the company's ability to diversify its revenue streams beyond the pandemic-driven demand. The slight increase in net sales and the adjusted diluted EPS beating the outlook indicate operational efficiency and effective cost management. However, the company's full-year sales decline of 8% underscores the challenges faced as COVID-19 related sales normalize.

Looking ahead to 2024, the minimum net sales outlook of $2.0 billion CER suggests cautious optimism, reflecting a modest total growth of at least 2% CER. The forecasted mid-single-digit CER sales growth in H2 2024 for the non-COVID portfolio points to expected continued diversification and growth in the core business. Nevertheless, the mention of 'significant non-operating income pressure' raises concerns about potential headwinds that could affect profitability, such as increased interest expenses or losses on foreign exchange due to market volatility.

Market Research Analyst

The 8% CER growth in QIAGEN's non-COVID portfolio indicates a strategic shift in the company's focus towards long-term sustainable products and services. This is a positive signal for investors, as it suggests that QIAGEN is not overly reliant on temporary market conditions caused by the pandemic. The company's ability to meet and exceed its EPS outlook despite a decline in total sales illustrates a strong command over its operational levers.

For investors, the forward-looking statements for 2024 offer a glimpse into the company's expectations for continued growth, albeit at a moderate pace. The mid-single-digit growth projection for the second half of 2024 could be indicative of new product launches or expansion into new markets. It's important to note that such projections are subject to various uncertainties, including market conditions and competitive dynamics, which can significantly impact the company's performance.

Economist

The company's performance in a post-pandemic environment, where COVID-19 related sales are normalizing, can be seen as a microcosm of the broader economic transition from pandemic-induced volatility to more stable growth patterns. The 2% increase in actual rates and 1% at constant exchange rates (CER) for Q4 2023 sales, along with the achieved outlook, suggests that QIAGEN is navigating currency fluctuations effectively, a key consideration for multinational corporations in the current economic climate.

The 2024 sales outlook, with expectations of at least 2% CER growth, is indicative of a conservative yet positive economic outlook for the company, reflecting broader industry trends of cautious optimism in the face of global economic uncertainties. Investors should consider the potential impact of macroeconomic factors such as inflation, currency exchange rates and global supply chain disruptions on QIAGEN's financial performance.

Q4 2023: Net sales of $509 million (+2% actual rates, +1% constant exchange rates, CER); diluted EPS of $0.42 and adjusted diluted EPS of $0.55 ($0.55 CER vs. $0.53 CER outlook) // FY 2023: Achieved outlook for at least $1.97 billion CER sales and at least $2.07 CER adj. EPS, +8% CER sales growth in non-COVID portfolio and 27% adj. operating income margin // 2024 outlook for at least $2.0 billion CER net sales; adj. diluted EPS of at least $2.10 CER, reflects adj. operating income margin gains but significant non-operating income pressure

Venlo, the Netherlands, Feb. 06, 2024 (GLOBE NEWSWIRE) -- QIAGEN N.V. (NYSE: QGEN; Frankfurt Prime Standard: QIA) announced results for the fourth quarter and full-year 2023.

Net sales results of $503 million at constant exchange rates (CER) for Q4 2023 achieved the outlook for at least $500 million CER, driven by 8% CER growth in the non-COVID-19 portfolio. Total sales for Q4 2023 rose 2% (+1% CER) to $509 million from Q4 2022, a period marked by significant COVID-19 sales. Adjusted diluted earnings per share (EPS) were $0.55 CER and above the outlook for at least $0.53 CER. Full-year 2023 sales declined 8% to $1.97 billion, achieving the outlook for $1.97 billion CER sales and were supported by 8% CER growth for non-COVID product groups. Adjusted diluted EPS were $2.09 CER and exceeded the outlook for at least $2.07 CER.

For 2024, QIAGEN has set an outlook for net sales of at least $2.0 billion CER. This reflects full-year total growth of at least 2% CER, with solid mid-single-digit CER sales growth in H2 2024 in the non‑COVID portfolio over the year-ago period. This outlook also includes about one percentage point of COVID-19 sales headwinds from 2023. Consumables and related revenues are expected to drive growth, while larger-scale instrument sales remain challenging. QIAGEN also continues to closely monitor dynamic geopolitical and macro trends around the world. Adjusted diluted EPS are expected to be at least $2.10 CER. This reflects at least one percentage point of improvement in the adjusted operating income margin to above 28% for FY 2024 compared to 2023 while supporting investments in the portfolio, in particular to accelerate growth in the QIAGEN Digital Insights bioinformatics business. Significant pressure is expected on non-operating income for FY 2024 due to anticipated lower interest income and a higher tax rate compared to 2023, more than offsetting benefits from the recently completed $300 million synthetic share repurchase.

“We closed 2023 with strong results in the fourth quarter as we delivered sales growth in the top tier of our industry along with solid profitability. Amid a dynamic macro-environment, our teams executed well to advance our strategy of “Balance and Focus” on areas offering the highest growth potential. Driven by 8% CER growth in our non-COVID portfolio, we made solid progress in driving growth of our consumables business, which accounts for over 85% of sales, while also expanding our installed instrument base,” said Thierry Bernard, Chief Executive Officer of QIAGEN. “These results demonstrate the power of our well-positioned portfolios to capture growth in dynamic applications across the Life Sciences and Molecular Diagnostics continuum. As we move into 2024, we are committed to delivering growth with sharpened focus and continued commitment to execution.”

Roland Sackers, Chief Financial Officer of QIAGEN, said: “QIAGEN has consistently implemented a disciplined capital allocation policy over the last decade thanks to a solid balance sheet and healthy cash flows. We are investing to support internal growth with a high level of R&D investments, while also increasing returns through a $300 million synthetic share repurchase that underscores our commitment to value creation. We are confident in our outlook to deliver growth in 2024 in both sales as well as operational profitability as we overcome significant non-operating income headwinds.”

Please find a PDF of the full press release incl. tables here.

Investor presentation and conference call

A conference call is planned for Wednesday, February 7, 2024 at 15:00 Frankfurt Time / 14:00 London Time / 9:00 New York Time. A live audio webcast will be made available in the investor relations section of the QIAGEN website, and a recording will also be made available after the event. A presentation will be available before the conference call at https://corporate.qiagen.com/investor-relations/events-and-presentations/default.aspx.

Use of adjusted results

QIAGEN reports adjusted results, as well as results on a constant exchange rate (CER) basis, and other non-U.S. GAAP figures (generally accepted accounting principles), to provide additional insight into its performance. These results include adjusted net sales, adjusted gross income, adjusted gross profit, adjusted operating income, adjusted operating expenses, adjusted operating income margin, adjusted net income, adjusted net income before taxes, adjusted diluted EPS, adjusted EBITDA, adjusted EPS, adjusted income taxes, adjusted tax rate, and free cash flow. Free cash flow is calculated by deducting capital expenditures for Property, Plant & Equipment from cash flow from operating activities. Adjusted results are non-GAAP financial measures that QIAGEN believes should be considered in addition to reported results prepared in accordance with GAAP but should not be considered as a substitute. QIAGEN believes certain items should be excluded from adjusted results when they are outside of ongoing core operations, vary significantly from period to period, or affect the comparability of results with competitors and its own prior periods. Furthermore, QIAGEN uses non-GAAP and constant currency financial measures internally in planning, forecasting and reporting, as well as to measure and compensate employees. QIAGEN also uses adjusted results when comparing current performance to historical operating results, which have consistently been presented on an adjusted basis.

About QIAGEN

QIAGEN N.V., a Netherlands-based holding company, is the leading global provider of Sample to Insight solutions that enable customers to gain valuable molecular insights from samples containing the building blocks of life. Our sample technologies isolate and process DNA, RNA and proteins from blood, tissue and other materials. Assay technologies make these biomolecules visible and ready for analysis. Bioinformatics software and knowledge bases interpret data to report relevant, actionable insights. Automation solutions tie these together in seamless and cost-effective workflows. QIAGEN provides solutions to more than 500,000 customers around the world in Molecular Diagnostics (human healthcare) and Life Sciences (academia, pharma R&D and industrial applications, primarily forensics). As of December 31, 2023, QIAGEN employed approximately 6,000 people in over 35 locations worldwide. Further information can be found at https://www.qiagen.com.

Forward-Looking Statement

Certain statements contained in this press release may be considered forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. To the extent that any of the statements contained herein relating to QIAGEN's products, timing for launch and development, marketing and/or regulatory approvals, financial and operational outlook, growth and expansion, collaborations, markets, strategy or operating results, including without limitation its expected adjusted net sales and adjusted diluted earnings results, are forward-looking, such statements are based on current expectations and assumptions that involve a number of uncertainties and risks. Such uncertainties and risks include, but are not limited to, risks associated with management of growth and international operations (including the effects of currency fluctuations, regulatory processes and dependence on logistics), variability of operating results and allocations between customer classes, the commercial development of markets for our products to customers in academia, pharma, applied testing and molecular diagnostics; changing relationships with customers, suppliers and strategic partners; competition; rapid or unexpected changes in technologies; fluctuations in demand for QIAGEN's products (including fluctuations due to general economic conditions, the level and timing of customers' funding, budgets and other factors); our ability to obtain regulatory approval of our products; difficulties in successfully adapting QIAGEN's products to integrated solutions and producing such products; the ability of QIAGEN to identify and develop new products and to differentiate and protect our products from competitors' products; market acceptance of QIAGEN's new products and the integration of acquired technologies and businesses; actions of governments, global or regional economic developments, weather or transportation delays, natural disasters, political or public health crises, and its impact on the demand for our products and other aspects of our business, or other force majeure events; as well as the possibility that expected benefits related to recent or pending acquisitions may not materialize as expected; and the other factors discussed under the heading “Risk Factors” contained in Item 3 of our most recent Annual Report on Form 20-F. For further information, please refer to the discussions in reports that QIAGEN has filed with, or furnished to, the U.S. Securities and Exchange Commission.

Source: QIAGEN N.V.
Category: Financial

FAQ

What were QIAGEN N.V.'s Q4 2023 net sales?

QIAGEN N.V. reported Q4 2023 net sales of $509 million at actual rates and $503 million at constant exchange rates (CER).

What was QIAGEN N.V.'s Q4 2023 diluted EPS?

QIAGEN N.V. reported Q4 2023 diluted EPS of $0.42 and adjusted diluted EPS of $0.55.

What was the FY 2023 outlook for QIAGEN N.V.?

QIAGEN N.V. achieved its FY 2023 outlook for at least $1.97 billion CER sales and at least $2.07 CER adj. EPS.

What is QIAGEN N.V.'s 2024 outlook for net sales?

QIAGEN N.V. has set an outlook for net sales of at least $2.0 billion CER for 2024.