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Marty Chilberg
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I'm a retired CPA who spent the majority of his working career in technology companies. My work included management stints at Atari Inc, Daisy Systems Corp, Symantec Corp and Visio Corp. My last position at Visio (VSIO) was as CFO and VP Finance and Operations.
  • Sequenom Q2 2014 1 comment
    Jul 29, 2014 10:57 PM | about stocks: SQNM

    Pretty confusing release with some missing disclosures. I won't be able to fully analyze until 10Q is filed and I have a chance to chat with cfo.

    Initial read:

    1) Revenues weak for international NIPT and domestic other LDT's. Hard to understand why cystic fibrosis is down given the increase in govt accessions and progress with 15 state agencies. Need to better understand trends.

    2) No read on MaterniT21 domestic. Accessions were "ok" but without the breakdown of intl/dom I'm simply guessing the weakness was more international than domestic.

    3) Govt accessions were up but no disclosure of MaterniT21 or revenues so again hard to get a read.

    4) Gross margin showed very nice improvement but until we hear about out of quarter collections it's unclear how much is real and how much is accounting.

    5) Loss from continuing ops was about right if you take out the tax benefit and add back the G&A costs for CEO retirement and the higher legal costs. Not sure why litigation costs were up this quarter.

    6) Cash burn from ops. Looked like nice improvement sequentially. Biggest positive takeaway in quarter.

    Bottom line: more Qs than answers. Don't like the reduced disclosure or continued reticence to provide substance to help understand business trends. That is frequently a sign of weakness. In this case I'll hold off until I talk to CFO given the segment sale. Company had a lot to worry about this quarter but still a concern. Cash improvements from cost controls look very positive but test/revenue trends are concerning.

    Disclosure: The author is long SQNM.

    Themes: NIPT, reproductive health Stocks: SQNM
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  • Marty Chilberg
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    Comments (379) | Send Message
     
    Author’s reply » Company provided update during Morgan Stanley breakout that Intl M21 accessions were 12% of total. That was up nicely from Q1 so the issue was domestic rather than Intl
    9 Sep, 06:59 PM Reply Like
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