GlobeNewswire Inc | Mar 25, 2021 09:28AM EDT

March 25, 2021

DUBLIN, Ireland, March 25, 2021 (GLOBE NEWSWIRE) -- Trinity Biotech plc (Nasdaq: TRIB), a leading developer and manufacturer of diagnostic products for the point-of-care and clinical laboratory markets, today announced results for the quarter ended December 31, 2020 and fiscal year 2020.

Fiscal Year 2020 Results

Total revenues for fiscal year 2020 were $102m versus $90.4m in 2019, an increase of 12.8% year on year and were broken down as follows:

Full Year Full Year Increase/ 2019 2020 (decrease) US$?000 US$?000 %Point-of-Care 11,393 9,215 (19.1%) Clinical Laboratory 79,042 92,765 17.4% Total 90,435 101,980 12.80%

Point-of-Care revenues decreased from $11.4m in 2019 to $9.2m in 2020, which represents a decrease of 19.1%. This was driven by lower HIV sales in both the USA and Africa. The decline in the USA was attributable to the decision to exit this market in 2019, which had been in decline for a number of years, whilst African sales were lower due to logistical and testing constraints arising from Covid-19 in the second and third quarters, with normal trading patterns only being restored in Q4 2020.

Clinical Laboratory revenues increased from $79.0m in 2019 to $92.8m, which represents an increase of 17.4%. The increase is mainly due to strong sales within our Covid-19 related portfolio of products, with our PCR Viral Transport Media product being the most significant contributor to revenue within that portfolio.

Due mainly to the impact of Covid-19, revenues for Haemoglobins, Autoimmune and Infectious Disease products all recorded decreases in 2020 compared to 2019. In our Haemoglobins business, revenues were affected by the deferral of Diabetes instrument purchases as healthcare resources were stretched by the pandemic. Our Autoimmune business was also impacted by Covid-19, experiencing lower testing volumes at its New York reference laboratory. Infectious Diseases revenues were impacted not only by pandemic factors but also by lower Lyme sales attributable to the continued migration away from Western Blot to other testing formats.

The gross margin for the year was 47.6% compared to 42.2% in 2019. This increase was largely due to the impact of strong sales within our Covid-19 related portfolio of products, fewer instrument placements, lower depreciation and a range of cost saving measures put in place during the year.

Other operating income increased from $0.1m in 2019 to $1.9m in 2020. The $1.9m income in 2020 mainly relates to funding received under the U.S. governments Cares Act, principally its Paycheck Protection Program. Two out of six Paycheck Protection Program (PPP) loans received by the Company were forgiven during the year. We are in the process of seeking forgiveness for the remaining four PPP loans totalling $2.9m and we expect them to be forgiven in 2021. These four remaining loans are treated as short term liabilities at December 31, 2020.

Research and Development expenses showed a slight reduction from $5.3m to $5.1m year on year. Meanwhile, Selling General and Administrative (SG&A) expenses decreased from $26.9m to $24.2m, a decrease of 10.0%. The decrease in SG&A expenses was mainly driven by cost saving measures which were implemented in response to the pandemic, and included the furloughing of some employees, reduced travel costs and cancellation of trade shows and other marketing activities. These savings were partially offset by increased performance-related pay due to higher revenues and profits.

Operating profit (before the impact of once-off items) for the year increased from $5.3m reported in 2019 to $20.3m in 2020. This increase was mainly attributable to higher revenues and gross margin, a reduction in indirect costs and the receipt of government financial aid.

The net financing expense for the year increased from $4.5m to $4.9m mainly due to lower deposit interest income on account of lower amounts held on deposit and lower prevailing interest rates.

Profit before tax (before the impact of once-off items & non-cash financial expense) for 2020 was $15.5m, an increase of $14.7m versus the $0.8m reported 2019. In 2020 the Company recorded an overall tax credit of $0.2m due to the impact of R&D tax credits in USA, Canada and Ireland.

Meanwhile, there was a profit after tax (before the impact of once-off items & non-cash financial income) of $15.7m in 2020 compared to a reported loss of $4.1m in 2019.

A non-cash financial expense of $1.9m was recognised in relation to the Exchangeable Notes. This was due to a non-cash interest charge of $0.7m and a non-cash charge of $1.2m arising due to an increase in the fair value of the derivatives embedded in these notes.

The basic earnings per ADR (our equivalent to EPS) (excluding once-off charges & non-cash financial items) for the year was 75.0 cents versus a loss per ADR of 19.4 cents in 2019. Meanwhile, there was an unconstrained diluted earnings (excluding once-off charges & non-cash financial items) per ADR of 74.9 cents compared to a loss per ADR of 0.3 cents in 2019.

Earnings before interest, tax, depreciation, amortisation and share option expense (EBITDASO) for the year was $24.2m. This is made up as follows:

$mOperating Profit (before non-cash and once-off items) 20.3Depreciation 1.7Amortisation 1.4Share option expense 0.8EBITDASO 24.2

The above measures exclude the impact of an impairment charge of $17.8m net of tax, more information about which is provided below and a provision of $2.4m relating to the closure of our Carlsbad, CA facility in Q2 2020.

Quarter 4 Results

Total revenues for Q4, 2020 were $32.8m, which compares to $21.3m in Q4, 2019 and were broken down as follows:

2019 2020 Increase/ Quarter 4 Quarter 4 (decrease) US$?000 US$?000 %Point-of-Care 2,172 2,548 17.3%Clinical Laboratory 19,146 30,217 57.8%Total 21,318 32,765 53.70%

Point-of-Care revenues in Q4, 2020 were higher than Q4, 2019 and in both quarters are largely comprised of sales of our Unigold HIV test in Africa. There was a strong recovery in HIV revenues in Africa this quarter following two successive quarters that were adversely affected by Covid-19 restrictions.

Clinical Laboratory revenues increased from $19.1m to $30.2m, which represents an increase of 57.8% compared to Q4, 2019. This increase is mainly due to strong sales within our Covid-19 related portfolio of products, with our PCR Viral Transport Media continuing to be the most significant contributor to revenue within that portfolio. The recovery in the Companys other product lines that we reported in Q3 2020 continued into Q4 2020. However, as expected revenues in Q4, 2020 did not return fully to pre-Covid levels mainly due to lower testing volumes at our Autoimmunity reference laboratory in New York and lower demand for some infectious disease testing outside of Covid-19.

Gross profit for Q4, 2020 amounted to $15.7m equating to a gross margin of 47.8%, which represents an improvement compared to the 43.5% reported in the equivalent quarter last year. This increase was largely due to the sales mix (more Covid-19 related revenues and fewer instrument placements) and cost saving measures.

Other operating income increased from $0.02m in Q4 2019 to $1.9m in Q4 2020. The $1.9m income in 2020 mainly relates to funding received under the U.S. governments Cares Act, principally its Paycheck Protection Program. Two out of six Paycheck Protection Program (PPP) loans received by the Company were forgiven during the year. As mentioned above, we are in the process of seeking forgiveness for the remaining four PPP loans totalling $2.9m and we expect them to be forgiven in 2021. These four remaining loans are treated as short term liabilities at December 31, 2020.

Research and Development expenses remained stable at $1.3m whilst Selling, General and Administrative (SG&A) expenses were higher for the quarter at $6.9m, which represents an increase of just under $0.5m compared to Q4, 2019. The increase in SG&A expenses was mainly driven by higher performance-related pay and unrealised foreign exchange losses on non-US Dollar denominated lease liabilities.

Operating profit (before the impact of once-off items) increased from $1.4m to $9.1m for the quarter, representing more than six times the operating profit for the same period last year. This was due to the impact of higher revenues, improved gross margin and Paycheck Protection Program loans forgiven, partially offset by higher indirect expenses during the quarter.

Financial income for the quarter showed a reduction due to lower average cash on deposit and interest rates. Meanwhile, Financial Expenses amounted to $1.2m, which was broadly in line with Q4, 2019. Of this, $1.0m related to interest payable on the Companys Exchangeable Notes, with the remaining $0.2m representing notional financing charges arising on leased assets. A further non-cash expense of $0.8m was recognised in this quarters income statement, again in relation to the Exchangeable Notes. This was due to a non-cash interest charge of $0.2m and a loss of $0.6m arising due to an increase in the fair value of the derivatives embedded in these notes.

The profit after tax, before impairment and non-cash financial expense, for the quarter was $8.6m compared to $1.3m for the equivalent period last year.

The basic earnings per ADR (our equivalent to EPS) (excluding once-off charge and non-cash financial items) for the quarter was 41.0 cents versus 6.1 cents in Q4, 2019. Unconstrained diluted earnings (excluding once-off charges & non-cash financial items) per ADR for the quarter amounted to 35.9 cents, which compares to 9.0 cents in the equivalent quarter in 2019.

Earnings before interest, tax, depreciation, amortisation and share option expense for the quarter was $10.1m. This is made up as follows:

$mOperating Profit (before non-cash and once-off items) 9.1Depreciation 0.5Amortisation 0.2Share option expense 0.3EBITDASO 10.1

The above measures exclude the impact of impairment charges amounting to $17.8m net of tax. More details on the impairment are provided below.

Cash generated from operations during the quarter was $17.3m. Meanwhile the Company paid $2m interest on the Exchangeable Notes. Other major cash outflows for the quarter included taxes and other interest of $1.1m, capital expenditure of $3.6m and payments for property leases of $0.7m. Overall, this resulted in an increase in cash from $19.9m to $27.3m, an increase of $7.4m during the quarter.

Impairment

In accordance with the provisions of accounting standards under IFRS, a company is required to carry out annual impairment reviews in order to determine the appropriate carrying value of its net assets. This years review has resulted in a non-cash impairment charge of $17.8m net of tax being recognised. A number of factors impacted this calculation including the Companys share price at 31 Dec 2020, cost of capital, cash flow projections and net asset values across each of the Companys individual main business lines.

New Product Update

HIV Point of Care Screening TrinScreen

Despite the impact of Covid-19 on HIV testing in Africa, the Company has successfully completed the necessary clinical trials for submission to the World Health Organisation (WHO) for pre-qualification of our HIV screening product, TrinScreen. This product, once approved, will allow the Company to build on its strong presence in HIV testing in Africa, with the Company having been the main confirmatory test provider over many years. The Company expects to submit the pre-qualification application to the WHO before the end of March 2021. While it is expected that the WHO will take several months to consider the approval, the Company intends to use that time to prepare for manufacturing of the test at our highly-automated facility in Ireland.

Covid-19 Rapid Antibody Test

Development of the Companys Covid-19 rapid anti-body test has been completed. The Company has begun to manufacture product for final validation in advance of an Emergency Use Authorisation (EUA) submission to the FDA. The Company expects to submit an EUA application to the FDA during quarter 2, 2021 to allow for its sale in the USA.

Covid-19 Rapid Antigen Test

The Company is developing a rapid Covid-19 antigen test. The Company intends to leverage its existing rapid infectious disease test design to expedite the development and validation timeframe and also generate scale efficiencies in manufacture & distribution.

Comments

Commenting on the results John Gillard, Chief Financial Officer stated, The Company delivered another strong quarter with an operating profit, excluding impairment charges, of $9.1m, compared to $1.4m in Q4 2019. Gross margin for the quarter increased to 47.8% compared to 43.5% in Q4 2019, with the company benefiting from a positive sales mix and cost control measures put in place during the year.

Commenting, Ronan OCaoimh, Chief Executive Officer stated, We are pleased to have such a profitable quarter with a 54% increase in sales compared to Q4 2019, largely driven by strong sales within our Covid-19 related portfolio of products. It is also encouraging to see the continued rebound of our core business into Q4 2020. This strong financial performance has translated into a closing cash balance of $27.3m, an increase of over $7m in the quarter. We are also excited to have completed the necessary clinical trials for our new HIV screening test, TrinScreen and look forward to an expected pre-qualification submission to the WHO by the end of this month. We expect that once the product is approved by the WHO, the Company is ideally positioned to take a significant share of the HIV screening market in Africa given the excellent clinical performance of the product and the Companys strong existing reputation in the HIV testing market in Africa, earned over many years.

Once-off charges and some items included in income tax are non-GAAP accounting presentations. The above mentioned numbers are unaudited.

Certain statements made in this release that are not historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words estimate, project, intend, expect, believe and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties. Many factors could cause the actual results, performance or achievements of Trinity Biotech to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, but not limited to, the results of research and development efforts, risks associated with the outbreak and global spread of the coronavirus (COVID-19), the effect of regulation by the U.S. Food and Drug Administration and other agencies, the impact of competitive products, product development commercialization and technological difficulties. For additional information regarding these and other risks and uncertainties associated with Trinity Biotechs business, reference is made to our reports filed from time to time with the U.S. Securities and Exchange Commission. We undertake no obligation to update or revise any forward-looking statements for any reason.

Trinity Biotech develops, acquires, manufactures and markets diagnostic systems, including both reagents and instrumentation, for the point-of-care and clinical laboratory segments of the diagnostic market. The products are used to detect infectious diseases and to quantify the level of Haemoglobin A1c and other chemistry parameters in serum, plasma and whole blood. Trinity Biotech sells direct in the United States, Germany, France and the U.K. and through a network of international distributors and strategic partners in over 75 countries worldwide. For further information, please see the Company's website: www.trinitybiotech.com.

Trinity Biotech plcConsolidated Income Statements Three Three Year Year Months Months Ended Ended(US$000?s except Ended Ended Dec 31, Dec 31, share data) Dec 31, Dec 31, 2020 2019 2020 2019 (unaudited) (unaudited) (unaudited) (unaudited) Revenues 32,765 21,318 101,980 90,435 Cost of sales (17,108 ) (12,044 ) (53,400 ) (52,315 ) Gross profit 15,657 9,274 48,580 38,120 Gross profit % 47.8 % 43.5 % 47.6 % 42.2 % Other operating 1,841 24 1,860 91 income Research & (1,284 ) (1,332 ) (5,080 ) (5,325 )development expensesSelling, general andadministrative (6,872 ) (6,399 ) (24,234 ) (26,852 )expensesIndirect share based (276 ) (123 ) (780 ) (732 )payments Operating profit 9,066 1,444 20,346 5,302 Financial income - 88 36 464 Financial expenses (1,224 ) (1,239 ) (4,892 ) (4,945 )Net financing expense (1,224 ) (1,151 ) (4,856 ) (4,481 ) Profit before tax,non-cash & once-off 7,842 293 15,490 821 items Income tax credit/ 730 988 182 (4,887 )(expense) Profit / (loss) aftertax before non-cash & 8,572 1,281 15,672 (4,066 )once-off items Non-cash financial (820 ) (160 ) (1,859 ) (405 )expenseImpairment & once-off (17,776 ) (24,443 ) (20,201 ) (24,443 )items (net of tax) Loss after tax and (10,024 ) (23,322 ) (6,388 ) (28,914 )once-off items Earnings/(Loss) per (48.0 ) (111.6 ) (30.6 ) (138.3 )ADR (US cents) Earnings/(Loss) per 41.0 6.1 75.0 (19.4 )ADR (US cents)** Diluted earnings/ ) ) ) )(loss) per ADR (US (30.8 * (87.0 * (2.0 * (96.2 *cents) Diluted earnings/ )(loss) per ADR (US 35.9 9.0 * 74.9 (0.3 *cents)** Weighted average no.of ADRs used in 20,901,703 20,901,703 20,901,703 20,901,703 computing basicearnings per ADR Weighted average no.of ADRs used in 26,663,066 25,467,516 26,256,183 25,467,516 computing dilutedearnings per ADR

* Under IAS 33 Earnings per Share, diluted earnings per share cannot be anti-dilutive. Therefore, diluted loss per ADR in accordance with IFRS would be equal to basic earnings per ADR. ** Excluding impairment, once-off charges & non-cash financial items.

The above financial statements have been prepared in accordance with the principles of International Financial Reporting Standards and the Companys accounting policies but do not constitute an interim financial report as defined in IAS 34 (Interim Financial Reporting). Once-off charges and some items included in income tax are non-GAAP accounting presentations.

Trinity Biotech plcConsolidated Balance Sheets Dec 31, Sept 30, June 30, Dec 31, 2020 2020 2020 2019 US$ ?000 US$ ?000 US$ ?000 US$ ?000 (unaudited) (unaudited) (unaudited) (unaudited)ASSETS Non-current assets Property, plant and 8,547 9,462 9,297 9,290 equipmentGoodwill and intangible 33,860 47,876 46,751 43,654 assetsDeferred tax assets 4,185 5,981 6,613 6,252 Other assets 355 387 378 485 Total non-current 46,947 63,706 63,039 59,681 assets Current assets Inventories 30,219 29,607 31,473 32,021 Trade and other 22,668 21,658 17,048 20,987 receivablesIncome tax receivable 3,086 1,194 1,598 1,982 Cash and cash 27,327 19,910 15,570 16,400 equivalentsTotal current assets 83,300 72,369 65,689 71,390 TOTAL ASSETS 130,247 136,075 128,728 131,071 EQUITY AND LIABILITIES Equity attributable tothe equity holders of the parentShare capital 1,224 1,213 1,224 1,224 Share premium 16,187 16,187 16,187 16,187 Accumulated surplus 5,918 15,665 8,194 11,514 Other reserves (25,548 ) (25,994 ) (26,317 ) (24,212 )Total equity (2,219 ) 7,071 (712 ) 4,713 Current liabilities Income tax payable 154 765 373 48 Trade and other 26,488 22,281 22,327 19,351 payablesProvisions 416 50 50 50 Total current 27,058 23,096 22,750 19,449 liabilities Non-current liabilities Exchangeable senior 83,884 83,063 82,902 82,025 note payableOther payables 16,619 16,786 16,531 17,745 Deferred tax 4,905 6,059 7,257 7,139 liabilitiesTotal non-current 105,408 105,908 106,690 106,909 liabilities TOTAL LIABILITIES 132,466 129,004 129,440 126,358 TOTAL EQUITY AND 130,247 136,075 128,728 131,071 LIABILITIES

The above financial statements have been prepared in accordance with the principles of International Financial Reporting Standards and the Companys accounting policies but do not constitute an interim financial report as defined in IAS 34 (Interim Financial Reporting). Some items included in equity are non-GAAP accounting presentations.

Trinity Biotech plcConsolidated Statement of Cash Flows Three Three Year Year Months Months Ended Ended(US$000?s) Ended Ended Dec 31, Dec 31, Dec 31, Dec 31, 2020 2019 2020 2019 (unaudited) (unaudited) (unaudited) (unaudited) Cash and cashequivalents at 19,910 25,090 16,400 30,277 beginning ofperiod Operating cashflows before 7,103 2,703 20,604 12,198 changes inworking capitalChanges in 10,164 (321 ) 7,688 (796 )working capitalCash generated 17,267 2,382 28,292 11,402 from operations Net Interest andIncome taxes (1,142 ) (5,962 ) (886 ) (5,928 )received/(paid) CapitalExpenditure & (3,615 ) (2,325 ) (10,435 ) (12,295 )Financing (net)

Payments for (670 ) (787 ) (3,031 ) (3,060 )leases (IFRS 16) Free cash flow 11,840 (6,692 ) 13,940 (9,881 ) Payment of HIV/2 - - (1,112 ) - License Fee Once-off items (2,425 ) - (2,425 ) - 30 yearExchangeable Note (1,998 ) (1,998 ) (3,996 ) (3,996 )interest payment Proceeds receivedunder Paycheck - - 4,520 - ProtectionProgram Cash and cashequivalents at 27,327 16,400 27,327 16,400 end of period

The above financial statements have been prepared in accordance with the principles of International Financial Reporting Standards and the Companys accounting policies but do not constitute an interim financial report as defined in IAS 34 (Interim Financial Reporting).

Trinity Biotech plcContact: John Gillard (353)-1-2769800 E-mail: investorrelations@trinitybiotech.com