Illumina, Inc. · NASDAQ:ILMN
Illumina — Q4 2016 Earnings Presentation
17 slides from Illumina's earnings presentation, Jan 31, 2017
Slide 1: Illumina Q4 and Fiscal Year 2016 Financial Results
Illumina Q4 and Fiscal Year 2016 Financial Results January 31, 2017 © 2016 Illumina, Inc. All rights reserved. Illumina, 24sure, BaseSpace, BeadArray, BlueFish, BlueFuse, BlueGnome, cBot, CSPro, CytoChip, DesignStudio, Epicentre, ForenSeq, Genetic Energy, GenomeStudio, GoldenGate, HiScan, HiSeq, HiS
Slide 2: Safe Harbor Statement
Safe Harbor Statement This communication may contain statements that are forward-looking. Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected o
Slide 3: Q4 2016 Overview
Q4 2016 Overview Revenue exceeded expectations Q4’16 Q4’15 Δ Revenue1 $619 $592 5% Gross Margin2 69.9% 71.7% (180 bps) Operating Margin2 29.5% 33.4% (390 bps) EPS3 $0.85 $0.81 5% ● Revenue growth driven by sequencing consumables and microarrays ● Increased investments in manufacturing, headcount, GR
Slide 4: Q4 2016 Revenue Growth Rates
Q4 2016 Revenue Growth Rates Sequencing consumables and microarrays fueled growth Q4 YoY% Sequencing2 Microarray2 Total Instruments (23%) N/P1 (23%) Consumables 20% 9% 18% Service and Other N/P1 N/P1 <1% Total 3% 14% 5% ● Consumables accounted for 66% of total revenue ● Sequencing consumable revenue
Slide 5: 2016 Revenue Growth Rates
2016 Revenue Growth Rates Sequencing consumables and microarrays fueled growth 2016 YoY% Sequencing2 Microarray2 Total Instruments (22%) N/P1 (21%) Consumables 23% 10% 21% Service and Other N/P1 N/P1 11% Total 6% 19% 8% ● Consumables accounted for 64% of total revenue ● Sequencing consumable revenue
Slide 6: Q4 2016 Consolidated Non-GAAP P&L
Q4 2016 Consolidated Non-GAAP P&L $ in millions, except % and per share data Q4’16 Q4’15 Δ Revenue $619 $592 5% GM%1 69.9% 71.7% (180 bps) R&D%1 19.5% 17.5% 200 bps SG&A%1 20.9% 20.9% 0 bps OM%1,2 29.5% 33.4% (390 bps) Stock Based Compensation $27 $35 (23%) Tax Rate3 28.5% 26.5% 200 bps Consolidated
Slide 7: 2016 Consolidated Non-GAAP P&L
2016 Consolidated Non-GAAP P&L $ in millions, except % and per share data 2016 2015 Δ Revenue $2,398 $2,220 8% GM%1 71.7% 72.4% (70 bps) R&D%1 19.3% 16.2% 310 bps SG&A%1 20.8% 19.8% 100 bps OM%1,2 31.6% 36.4% (480 bps) Stock Based Compensation $129 $133 (3%) Tax Rate3 26.1% 27.1% (100 bps) Consolida
Slide 8: Balance Sheet / Cash Flow
Balance Sheet / Cash Flow Strong cash position $ in millions, except DSO Q4’16 Q3’16 Cash & Investments $1,559 $1,536 Inventory $300 $312 Accounts Receivable (DSO) $381 (56) $382 (57) Principal Amount of Convertible Notes Outstanding $1,150 $1,150 Operating Cash Flow $280 $150 Free Cash Flow $199 $9
Slide 9: 2017 Guidance
2017 Guidance Double-digit revenue growth in FY’17 Q1’171 20171 Revenue Revenue2 $580M–$595M 10%–12% GAAP EPS4 GAAP EPS3,4 $0.51 - $0.56 $3.25 - $3.35 Non-GAAP EPS4,5 Non-GAAP EPS3,4,5 $0.60 - $0.65 $3.60 - $3.70 1. Guidance given via 8-k and press release on January 31, 2017 2. Assumes constant cur
Slide 10: Q1 2017 Non-GAAP EPS Guidance
Q1 2017 Non-GAAP EPS Guidance Q1 EPS guidance driven primarily by Q1 revenue given the NovaSeq launch1 2 3 4,5 2,6,7 1. The revenue and EPS figures are based on mid-point of the guidance range 2. Non-GAAP EPS attributable to Illumina stockholders 3. Includes gross margin impact 4. SBC is stock based
Slide 11: 2017 Non-GAAP EPS Guidance
2017 Non-GAAP EPS Guidance EPS guidance driven by higher FY’17 revenue and expense increases1 5 2 4 3 2,6,7 1. The revenue and EPS figures are based on mid-point of the guidance range 2. Non-GAAP EPS attributable to Illumina stockholders 3. Includes gross margin impact 4. “Other” includes small non-
Slide 12: Appendix: Non-GAAP Reconciliations
Appendix Non-GAAP Reconciliations 12
Slide 13: Reconciliation Between GAAP and Non-GAAP Earnings Per Share
Reconciliation Between GAAP and Non-GAAP Earnings Per Share Attributable to Illumina Stockholders: Three Months Ended Years Ended January 1, January 3, January 1, January 3, 2017 2016 2017 2016 GAAP earnings per share attributable to Illumina stockholders - diluted $ 0.84 $ 0.70 $ 3.07 $ 3.10 Amorti
Slide 14: Footnotes to the Reconciliation Between GAAP and Non-GAAP Measures
Footnotes to the Reconciliation Between GAAP and Non- GAAP Measures: (a) Non-cash interest expense is calculated in accordance with the authoritative accounting guidance for convertible debt instruments that may be settled in cash. (b) Contingent compensation (gain) expense relates to contingent pay
Slide 15: Reconciliation Between GAAP and Non-GAAP Results of Operations as a Percent of Revenue
Reconciliation Between GAAP and Non-GAAP Results of Operations as a Percent of Revenue: Three Months Ended Years Ended January 1, January 3, January 1, January 3, 2017 2016 2017 2016 GAAP gross profit $ 419,439 67.7 % $ 410,359 69.4 % $ 1,666,448 69.5 % $ 1,549,290 69.8 % Stock-based compensation ex
Slide 16: Footnotes to the Reconciliation Between GAAP and Non-GAAP Results of Operations
Footnotes to the Reconciliation Between GAAP and Non- GAAP Results of Operations: (a) Non-GAAP gross profit, included within non-GAAP operating profit, is a key measure of the effectiveness and efficiency of manufacturing processes, product mix and the average selling prices of the company’s product
Slide 17: Reconciliation of Non-GAAP Financial Guidance
Reconciliation of Non-GAAP Financial Guidance The company’s future performance and financial results are subject to risks and uncertainties, and actual results could differ materially from the guidance set forth below. More information on potential factors that could affect the company’s financial r