Qiagen NV (
Q2 2011 Earnings Call
July 26, 2011 9:30 AM ET
Dr. Solveigh Mähler – Director, IR
Peer Schatz – CEO
Roland Sackers – CFO
Quintin Lai – Robert W. Baird
Bill Quirk – Piper Jaffray
Brigitte de Lima – Bank of America Merrill Lynch
Holger Blum – Deutsche Bank
Tycho Peterson – JP Morgan
Peter Welford – Jefferies
Ladies and gentlemen, thank you for standing by. Welcome to the QIAGEN NV Investor and Analyst Conference Call on the Q2 Results 2011. Throughout today’s recorded presentation all participants will be in a listen-only mode. The presentation will be followed by a question-and-answer session. (Operator Instructions)
I would now like to turn the conference over to Dr. Mähler, Director, Investor Relations. Please go ahead ma’am.
Dr. Solveigh Mähler
Yeah. Thank you very much, Jason; and hello, everybody. Welcome to QIAGEN’s second quarter 2011 earnings conference call. I am Solveigh Mähler, Director of Investor Relations at QIAGEN. With me on the call are QIAGEN’s CEO, Peer Schatz; and QIAGEN’s CFO, Roland Sackers.
We issued a press release last night announcing QIAGEN’s financial results for the second quarter ending June 30, 2011, describing the Company’s recent business highlights. A copy of this announcement, as well as the presentation we will be using during this conference call can be downloaded from the Investor Relations section of our homepage at www.qiagen.com. This conference call will cover 30-minutes presentation followed by a Q&A session. The time of the conference call is set at one hour. We, therefore, would like to ask you to please limit yourself to only two questions during the Q&A session. The call will be archived on our website.
Before I turn over to Peer Schatz, please keep in mind that the following discussion and the responses to your questions reflect management’s view as of today, July 26, 2011. As you listen to the call, I encourage you to have our press release and presentation in front of you, since our financial results and the detailed commentaries are included and will correspond to the discussion that follows.
As we share information today to help you better understand our business, it is important to keep in mind that we will make statements and provide responses in the course of this conference call that state our intentions, beliefs, expectations, or predictions of the future. These constitute forward-looking statements for the purpose of the Safe Harbor provision. These forward-looking statements involve certain risks and uncertainties that could cause QIAGEN’s actual results to differ materially from those projected. QIAGEN disclaims any intention or obligation to revise any forward-looking statements.
In addition, certain statements contained in this presentation are based on company assumptions including, but not limited to, revenue allocations based on business segments. For the description of such risks and uncertainties please refer to the discussions and reports that QIAGEN has filed with the U.S. Securities and Exchange Commission. Additionally, we will be discussing GAAP and non-GAAP measures. A full reconciliation of the non-GAAP measures to GAAP can be found in the press release on our website.
With this, I would like to hand over to Peer Schatz. Peer?
Yeah. Thank you, Solveigh. I would like to welcome all of you to our conference call and the opportunity to discuss our results for the second quarter 2011. The progress we’ve been making on our strategy and our perspectives on the second half of the year. As we outlined 2011 is a transition year with difficult comps. At the same time, it is also year for us to build up our portfolio of molecular content and rollout our new automation platforms that we believe will create substantial growth opportunities in 2012 and beyond.
As you saw in the press release issued last night, results in the second quarter improved over the second period of 2010. We delivered higher net sales and earnings along with the significant increase in our free cash flow. Those results were also an improvement on the soft start to the year that we saw in the first quarter. At the same time, we are clearly not growing at a level that we believe is satisfactory. However, we are making broad progress in our strategic initiatives to expand in 2011 in order to accelerate growth in 2012. This progress is reflected in the milestone that our teams have achieved. The global rollout is going well for QIAsymphony. We have now reached installed base of 475 systems worldwide.
QIAsymphony is a highly versatile, modular automation platform that we believe will play a key role in the dissemination of molecular technologies, and in particular will be the driving force for the expanding use of our molecular assays. Every placement creates an opportunity for annual consumable sales or so called pull-through of anywhere between 30,000 and $300,000.
Demand remains strong for the full QIAsymphony RGQ version. This was launched in late 2010 and incorporates the Rotor-Gene Q real-time PCR cycler along with the SP or sample preparation and AS for asset set of modules that were launched in recent years.
In personalized healthcare we reached an important milestone by completing the landmark regulatory submission of the KRAS biomarkers, a companion diagnostic paired with the anti-cancer medicine. This is the most significant achievement today from our more than 15 co-development projects underway with major pharmaceutical companies.
In fact we will complete our second separate PMA submission in the U.S. this week. It involves the use of KRAS biomarker with another anti-cancer medicine, also for patients with colorectal cancer. In addition, we are very actively expanding our projects of co-development projects and I’ll talk to that later.