QIAGEN(US:QGEN)2022-04-28 20:15Financial Data and Key Metrics Changes - Net sales for Q1 2022 grew 15% at constant exchange rates (CER) to $628 million compared to the same period in 2021, exceeding the outlook of at least 7% growth CER [12][11] - Adjusted earnings per share (EPS) for Q1 2022 increased to $0.83 CER, surpassing the outlook of at least $0.72 [13][11] - Operating cash flow rose 61% to $207 million, while free cash flow more than doubled to $178 million compared to Q1 2021 [14][35] Business Line Data and Key Metrics Changes - Non-COVID product sales grew 14% CER, while COVID-19 related product sales saw an 18% CER growth, driven by Omicron outbreaks in Europe [12][18] - Consumables and related revenues increased 17% CER, representing 89% of total sales, while instrument sales rose slightly by 2% CER [19][20] - Sales in Diagnostic Solutions rose 21% CER, with QuantiFERON sales increasing by 41% CER to $78 million [23][12] Market Data and Key Metrics Changes - EMEA region sales grew 24% CER, with strong performance in Germany, Spain, the Netherlands, and the UK [27] - Asia Pacific, Japan region also saw a solid growth of 25% CER, with China growing above 10% CER [27] - In the Americas, sales rose 4% CER, with single-digit growth in the U.S. and Brazil, while sales in Mexico declined [28] Company Strategy and Development Direction - The company has increased its outlook for full-year 2022 sales to at least $2.12 billion, driven by double-digit CER growth from non-COVID products [15][49] - Focus remains on advancing non-COVID product groups while maintaining a conservative view on COVID-19 testing demand [15][16] - The company is exploring options for capital deployment, including bolt-on acquisitions, to create greater value for shareholders [39][88] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's robust strategy and execution despite international economic uncertainty [15][11] - The company anticipates a normalization of COVID-related business to pre-COVID growth rates in the second half of the year [70][50] - Management highlighted the importance of maintaining strong profitability and cash flow to support future growth [14][57] Other Important Information - Adjusted gross margin for Q1 2022 stood at 68.6%, largely unchanged from the previous year [29] - R&D investments declined as a percentage of sales to 7.4%, with a target rate of at least 8% to 9% [30] - The company completed a share repurchase program, buying back 1.9 million shares for $100 million [39] Q&A Session Summary Question: Can you discuss the margin performance and expectations going forward? - Management noted that pricing power helped maintain margins despite inflation-driven costs, and they are reinvesting some proceeds into R&D and marketing [64][66] Question: What is the outlook for QIAstat and its market share? - Management confirmed the target for QIAstat to capture at least 10% of the syndromic market, which is expected to grow at around 15% annually [78][79] Question: What is the capital deployment outlook regarding acquisitions and share buybacks? - Management indicated a balanced approach to capital deployment, focusing on bolt-on acquisitions while continuing share buyback programs [86][90] Question: What is the expected growth for QuantiFERON in 2022? - Management confirmed a double-digit growth expectation for QuantiFERON in 2022, with a strong start in Q1 [112][113] Question: How is the company addressing the decline in non-COVID sample tech? - Management acknowledged a tough comparison in Q1 but expects normalization in growth rates for non-COVID sample tech in the upcoming quarters [120][121]