Biosensors' Q1 profit dips 4% on forex factor, lower revenue

But operating income jumps 21 per cent as cost cutting reduces operating expenses

The first-quarter financial showing of Biosensors International Group took a hit owing to foreign exchange factors as well as falling licensing and product revenue.

Net profit for the period ended June 30 fell 4 per cent to US$9.46 million (S$13 million) as revenue slumped 16 per cent to US$67 million.

A negative foreign exchange impact was the main cause of the fall in revenue, which consisted of both licensing and royalty revenue and product revenue, said the company. Licensing and royalty revenue declined from a year earlier, and product revenue fell to US$60.5 million from US$70.5 million.

Product revenue declined on lower revenue from cardiac diagnostics, interventional cardiology products and critical care products.

Cardiac diagnostics revenue fell to US$3.3 million from US$4.4 million owing to some hospital installation delays on the company's products.

  • AT A GLANCE

  • NET PROFIT (FOR THE QUARTER):
    US$9.463 million (-4%)

  • REVENUE (FOR THE QUARTER):
    US$67.027 million (-16%)

Although net profit was down, operating income jumped 21 per cent to US$18.3 million. This was mainly because operating expenses fell 27 per cent to US$32.7 million, owing to cost-reduction initiatives, the company said.

Earnings per share for the quarter was 0.56 US cent, down from 0.58 US cent in the same period last year after exceptional items were taken into account.

Net asset value a share was 61.13 US cents as at June 30, up from 60.36 US cents as at March 31.

The company said it "still aims to achieve revenue growth for this fiscal year", although it continues to expect market competition, pricing pressure, and unfavourable currency impact to remain as headwinds.

Licensing income from its partner could continue to fall, it added.

Revenue growth would likely be largely driven by sales of the product BioFreedom, the cardiac diagnostic business, and further expansion in Japan and emerging markets, it said

The better performance in the past three quarters in operating income growth demonstrated the company was heading in the "right direction", Biosensors said.

It would continue to work towards improving its operational efficiency and productivity, it said.

In the longer term, it would "continue to enhance its competitiveness and increase its market share in the global cardiovascular markets, while also seeking new growth businesses and other attractive opportunities".

The company's shares fell 5.5 cents, or 7.91 per cent, to 64 cents.

A version of this article appeared in the print edition of The Straits Times on August 04, 2015, with the headline 'Biosensors' Q1 profit dips 4% on forex factor, lower revenue'. Print Edition | Subscribe