FORT MYERS — Cancer-testing firm NeoGenomics swung to a profit in the second quarter, boosted by a 49% jump in revenues.
But the company warned that regulatory changes in Medicare billing for certain tests will affect sales and earnings in the third quarter.
NeoGenomics reported it earned net income of $551,000 in the second quarter compared with a loss of $293,000 in the same quarter last year. Revenues rose 49% to $15.6 million in the second quarter, fueled by a 57% jump in cancer-test volume. Profit margins grew as the company's expenses grew at a slower pace than test volume.
“We are very pleased with our industry-leading revenue growth rates of 49% in the second quarter and 60% on a year-to-date basis,” Douglas VanOort, NeoGenomics' chairman and CEO, says in a statement.
“We have also made huge strides in increasing the productivity and efficiency of our lab operations,” VanOort says. “The average number of tests completed per lab employee has increased 16%, and the average cost per test has decreased 9% since the end of last year.”
However, VanOort says changes in Medicare billing will translate into a 5% to 8% drop in price for certain tests it performs for hospitals. He forecasts the company's revenues will range from $14 million to $14.8 million and zero to 2 cents-per-share loss in the third quarter.
Headquartered in Fort Myers, NeoGenomics has cancer-testing labs in Irvine, Calif., Nashville and Tampa. The company's shares are publicly traded (symbol: NGNM; recent price: $1.95).