February 01, 2021

Omnicell Reports Fiscal Year and Fourth Quarter 2020 Results

Record 2020 Total Product Bookings of $1+ billion

Full Year 2020 Revenues of $892.2 million

Ended Year with 145 Long-Term, Sole-Source Agreements with the Top 300 U.S. Health Systems

Entered 2021 with Record Product Backlog of $924 million

Omnicell, Inc. (NASDAQ:OMCL), a leading provider of medication management solutions and adherence tools for healthcare systems and pharmacies, today announced results for its fiscal year and fourth quarter ended December 31, 2020.

This release is accompanied by a multimedia presentaion, which can be viewed here.

GAAP Results

Total revenues for the fourth quarter of 2020 were $249.2 million, up $0.9 million from the fourth quarter of 2019. Total revenues for the year ended December 31, 2020 were $892.2 million, down $4.8 million from the year ended December 31, 2019.

Fourth quarter 2020 GAAP net income was $16.4 million, or $0.37 per diluted share. This compares to GAAP net income of $22.1 million, or $0.51 per diluted share, for the fourth quarter of 2019.

GAAP net income for the year ended December 31, 2020 was $32.2 million, or $0.74 per diluted share. This compares to GAAP net income of $61.3 million, or $1.43 per diluted share, for the year ended December 31, 2019.

Non-GAAP Results

Non-GAAP net income for the fourth quarter of 2020 was $40.2 million, or $0.91 per diluted share. This compares to non-GAAP net income of $33.5 million, or $0.77 per diluted share, for the fourth quarter of 2019.

Non-GAAP net income for the year ended December 31, 2020 was $111.3 million, or $2.54 per diluted share. This compares to non-GAAP net income of $120.7 million, or $2.81 per diluted share, for the year ended December 31, 2019.

Non-GAAP net income for each period excludes, when applicable, the effect of share-based compensation expense, amortization expense of acquired intangible assets, acquisition-related expenses, restructuring and severance-related expenses, tax restructuring benefits and expenses, amortization of debt issuance costs, amortization of discount on convertible senior notes, and certain litigation costs.

Total product bookings for the year ended December 31, 2020 were $1.002 billion compared to $813 million for the year ended December 31, 2019, or an increase of 23% year-over-year. Total product backlog for the year ended December 31, 2020 was $924 million compared to $588 million for the year ended December 31, 2019, or an increase of 57% year-over-year.

“We had a strong fourth quarter and full year 2020, consistent with the preliminary results we announced last month. We are pleased to have exceeded our pre-pandemic bookings guidance and October 2020 guidance across nearly all key metrics, including total revenues, total product bookings, and non-GAAP earnings per share, and ended the year with record product bookings of more than $1 billion,” stated Randall Lipps, Chairman, President, Chief Executive Officer, and founder of Omnicell. “We made tremendous progress advancing the autonomous pharmacy as we continued expanding our portfolio and investing in developing a single, cloud-based platform that can connect nearly all of our devices. The pandemic highlighted the need for increased digitization and virtualization of processes throughout the healthcare system, underscoring the strategic relevance of Omnicell’s solutions. Pharmacy automation is becoming increasingly important, and that is reflected in the robust and growing demand for our offerings. Looking ahead, I believe we are well-positioned to continue driving growth in our business and delivering value for our shareholders as we support our healthcare partners on their journey to the autonomous pharmacy.”

2021 Guidance

For the first quarter of 2021, the Company expects total revenues to be between $243 million and $248 million. The Company expects product revenues to be between $171 million and $174 million, and service revenues to be between $72 million and $74 million. The Company expects first quarter 2021 non-GAAP EBITDA to be between $40 million and $43 million. The Company expects first quarter 2021 non-GAAP earnings to be between $0.64 and $0.69 per share.

For the full year 2021, the Company expects product bookings to be between $1.090 billion and $1.150 billion. The Company expects total revenues to be between $1.085 billion and $1.105 billion. The Company expects product revenues to be between $770 million and $785 million, and service revenues to be between $315 million and $320 million. The Company expects 2021 non-GAAP EBITDA to be between $228 million and $240 million. The Company expects 2021 non-GAAP earnings to be between $3.40 and $3.60 per share.

The table below summarizes Omnicell's 2021 guidance outlined above.

 

Q1'21

2021

Product Bookings

Not provided

$1.090 billion - $1.150 billion

Total Revenues

$243 million - $248 million

$1.085 billion - $1.105 billion

Product Revenues

$171 million - $174 million

$770 million - $785 million

Service Revenues

$72 million - $74 million

$315 million - $320 million

Non-GAAP EBITDA

$40 million - $43 million

$228 million - $240 million

Non-GAAP EPS

$0.64 - $0.69

$3.40 - $3.60

The Company does not provide guidance for GAAP net income or GAAP earnings per share nor a reconciliation of forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measures on a forward-looking basis because it is unable to predict certain items contained in the GAAP measures without unreasonable efforts. These non-GAAP financial measures do not include certain items, which may be significant, including but not limited to unusual gains and losses, costs associated with future restructurings, acquisition-related expenses, and certain tax and litigation outcomes.

2025 Targets

The Company has established a 2025 total revenue target of $1.9 billion to $2.0 billion, reflecting a 2021-2025 compound annual growth rate (“CAGR”) of 14%-15%. On an organic basis, the Company is targeting an 11%-12% revenue CAGR over the same time frame, with expected total organic revenue of $1.65 billion to $1.75 billion in 2025.

The Company is targeting a revenue CAGR of approximately 50% from 2020 to 2025 for Software-as-a-Service (“SaaS”), Subscription Software and Technology-Enabled Services, with revenues expected to reach 20%-30% of total Omnicell revenues by 2025.

Omnicell has also set a non-GAAP operating margin target of approximately 21% and a non-GAAP EBITDA margin target of approximately 25% by 2025. This represents a non-GAAP operating margin and a non-GAAP EBITDA margin expansion of approximately 400 bps from 2021.

The Company does not provide GAAP operating margin targets or GAAP net operating income margin targets nor a reconciliation of non-GAAP financial targets to the most directly comparable GAAP financial targets because it is unable to predict certain items contained in the GAAP measures without unreasonable efforts. These non-GAAP financial targets do not include certain items, which may be significant, including but not limited to unusual gains and losses, costs associated with future restructurings, acquisition-related expenses, and certain tax and litigation outcomes.

COVID-19 Update

Keeping in mind its role in the healthcare industry, the Company is continuing to closely monitor the COVID-19 pandemic. As a result of the COVID-19 pandemic, health systems have faced financial pressures which the Company believes led its customers to delay or defer purchasing decisions and/or implementation of the Company's solutions during the first half of 2020. However, starting in the third quarter of 2020, the Company began to see its customers returning to pre-pandemic purchasing patterns consistent with long-term strategic investments. Though the Company expects to continue to face challenges and opportunities brought on by the COVID-19 pandemic, it remains confident in the overall health of its business and in its ability to navigate through these unusual times.

Omnicell Conference Call Information

Omnicell will hold a conference call today, Monday, February 1, 2021, at 1:30 p.m. PST, to discuss its 2020 fiscal year and fourth quarter financial results. Interested parties can access the conference call by dialing 1-844-358-6756 within the U.S. or 1-216-562-0399 for all other locations. The Conference ID # is 9490367. The webcast of the conference call, along with related slides, will be accessible through Omnicell’s website at https://ir.omnicell.com/investor-relations and will be available for replay through Monday, March 1, 2021.

The conference call will include a multimedia presentation, which can be viewed here.

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