QuidelOrtho Reports Fourth Quarter and Full-Year 2023 Financial Results

Strong momentum in Labs business, with solid non-respiratory business growth and market share gains in industry-leading respiratory point-of-care portfolio.

Fourth Quarter 2023 Results and Highlights

• Revenue was $743 million, as reported:
  • Non-respiratory revenue increased by 9% as reported and in constant currency
  • Respiratory revenue decreased by 49% as reported and in constant currency
• GAAP net cash provided by operating activities was $80 million; adjusted free cash flow was $89 million
• Received 510(k) clearance for Savanna multiplex molecular platform and HSV/VZV PCR assay
• Received CLIA waiver for Sofia^® 2 SARS Antigen+ FIA

Full-Year 2023 Results and Highlights

• Revenue was $3.0 billion, as reported:
  • Non-respiratory revenue increased by 61% as reported (largely driven by the Combinations); supplemental combined non-respiratory revenue increased by 5% in constant currency
  • Respiratory revenue decreased by 61% as reported; supplemental combined respiratory revenue decreased by 62% in constant currency
• GAAP net cash provided by operating activities was $280 million; adjusted free cash flow was $270 million
• Paid down $227 million in term loan debt and completed $7 million in share repurchases
• Received more than 700 regulatory clearances in U.S., EMEA and China

SAN DIEGO, CA - QuidelOrtho Corporation (Nasdaq:QDEL) ("the Company" or “QuidelOrtho”), a global provider of innovative in vitro diagnostics technologies designed for point-of-care settings, clinical labs and transfusion medicine, today announced financial results for the fourth quarter and full-year ended December 31, 2023.

“In our first full year operating as a combined company, we successfully laid the foundation for building a broader-based diagnostics company poised for future growth. We are encouraged by the growth in our non-respiratory business, the market share gains we are seeing in our respiratory portfolios, and the U.S. launch of our Savanna molecular platform. Our competitive positions are strong across the globe, and we believe our pipeline of innovative new products and menu expansions will continue to strengthen pull-through across our growing installed base,” said Douglas Bryant, President and Chief Executive Officer of QuidelOrtho.

"We identified substantially greater synergies, while investing in the business and paying down debt. For example, we completed significant manufacturing upgrades to address instrument backlogs and meet market demand in our Labs business. In our Transfusion Medicine business, we are determined to continue investing in our Immunohematology portfolio and will begin winding down the U.S. Donor Screening portfolio,” he added.

“We have taken measures to reduce costs across the Company to lessen the impact of macro factors, such as inflation, the variability of the respiratory season and global supply chain constraints. Finally, we are accelerating our business efficiency initiatives, including our capital allocation strategy and portfolio management processes, to support durable long-term growth and generate shareholder value,” Bryant concluded.
 

Fourth Quarter 2023

The Company reported total revenue for the fourth quarter of 2023 of $743 million, compared to $867 million in the prior year period. Foreign currency translation did not significantly impact fourth quarter 2023 results. GAAP diluted EPS for the fourth quarter of 2023 was $0.10, compared to $0.45 in the prior year period. GAAP operating income for the fourth quarter of 2023 was $40 million, compared to $87 million in the prior year period, and GAAP operating margin was 5% in the fourth quarter of 2023, compared to 10% in the prior year period. Fourth quarter 2023 results included $33 million in integration-related charges.

Adjusted diluted EPS for the fourth quarter of 2023 was $1.17, compared to $1.76 in the prior year period. Adjusted EBITDA for the fourth quarter of 2023 was $195 million, compared to $245 million in the prior year period. Adjusted EBITDA margin for the fourth quarter of 2023 was 26%, compared to 28% in the prior year period. The year-over-year change in adjusted diluted EPS and adjusted EBITDA was primarily related to the decline in COVID-19 revenue compared to the prior year period, as anticipated.
 

Full-Year 2023

The Company reported total revenue for the full-year 2023 of $3.0 billion, compared to $3.3 billion in the prior year. Foreign currency translation did not significantly impact full-year 2023 results. GAAP diluted loss per share for the full-year 2023 was $0.15, compared to diluted EPS of $9.56 in the prior year. GAAP operating income for the full-year 2023 was $139 million, compared to $844 million in the prior year, and GAAP operating margin was 5% for the full-year 2023, compared to 26% in the prior year. Full-year 2023 results included $113 million in integration-related charges.

To facilitate a year-over-year comparison of the Company’s operating performance, all growth rates referenced below are presented on a supplemental combined basis as if Quidel Corporation and Ortho Clinical Diagnostics Holdings plc had been combined for the full-year 2022 and are referred to as “supplemental combined” information.

Adjusted diluted EPS for the full-year 2023 was $4.13, compared to supplemental combined adjusted diluted EPS of $13.80 in the prior year. Adjusted EBITDA for the full-year 2023 was $723 million, compared to supplemental combined adjusted EBITDA of $1.54 billion in the prior year. Adjusted EBITDA margin for the full-year 2023 was 24%, compared to supplemental combined adjusted EBITDA margin of 38% in the prior year. The year-over-year change in adjusted EPS and adjusted EBITDA was primarily related to the anticipated decline in COVID-19 revenue compared to the prior year.

Fiscal Year 2024 Financial Guidance

Based on its current business outlook, the Company is providing fiscal year 2024 financial guidance, as follows:

Conference Call Information

QuidelOrtho will hold a conference call today at 2:00 p.m. PT / 5:00 p.m. ET to discuss its financial results for the fourth quarter and full-year ended December 31, 2023. Interested parties can access the call on the “Events & Presentations” section of the “Investor Relations” page of the Company’s website at https://ir.quidelortho.com/. Presentation materials will also be posted to the “Events & Presentations” section of the “Investor Relations” page of the Company’s website at the time of the call. Those unable to access the webcast may join the call via phone by dialing 833-470-1428 (domestic) or 929-526-1599 (international) and entering Conference ID number 437438.

A replay of the conference call will be available shortly after the event on the “Investor Relations” page of the Company’s website, under the “Events & Presentations” section.