9/9/2021

speaker
Jamie
Conference Operator

Good morning, everyone, and welcome to the Trinity Biotech Q2 2021 Financial Results Conference Call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star and then one. To withdraw your questions, you may press star and two. Please also note today's event is being recorded. At this time, I'd like to turn the conference call over to Joe Diaz with Witham Partners. Sir, please go ahead.

speaker
Joe Diaz
Moderator, Withum Partners

Thank you, Jamie. And thanks to all of you for joining us today to review the financial results of Trinity Biotech for the second quarter of 2021, which ended on June 30, 2021. Joining us on today's call is Ronan O'Keefe, Chairman and Chief Executive Officer of Trinity Biotech, and John Gillard, Chief Financial Officer. At the conclusion of today's prepared remarks, we will open the call for a question and answer session. Before we begin, I must inform you that statements made in this conference call may be deemed forward-looking statements within the meaning of the federal securities laws. These statements are subject to known and unknown risks and uncertainties that may cause actual results to differ from those expressed or implied in such statements. These risks include but are not limited to those set forth in the risk factor section of our annual report on Form 20F filed with the Securities and Exchange Commission. We undertake no obligation to publicly update or revise these forward-looking statements to reflect events or circumstances after today or the occurrences of unanticipated events. With that said, I will now turn the call over to John Gillard, CFO of Trinity Biotech, for a review of the results of the quarter. And he'll be followed by Chairman and CEO Ronan O'Quive for an update on sales, marketing, and revenue. John, please proceed.

speaker
John Gillard
Chief Financial Officer, Trinity Biotech

Thank you, Joe. Good morning, everyone. Thank you for joining. As Joe mentioned, I will now take you through the results for Q2 2021. You will notice from our press release that a non-cash impairment charge has been recognized this quarter and is discussed in the press release. I will give further details on that charge later in the call. The income statement metrics I will quote, exclude the impact of that impairment charge. Starting with revenues, total revenues for the quarter were $25.8 million, compared with $16 million in Q2 2020. As Joe pointed out, and is our typical approach, Ronan will discuss revenues in further detail later on the call. As such, I will move on to discuss other aspects of the income statement. Gross margin for the quarter was 42.7%, which is broadly similar to the 42.9% achieved in Q2 2020. The small decline in overall margin is driven by a lower comparative margin from VTM products, partially offset by a higher margin from our core products in Q2 2021 when compared to Q2 2020. As ever, our gross margin remains susceptible to product mix changes, geographic spread, currency fluctuations and product level variations. Other operating income increased from $2,000 in Q2 2020 to $2.9 million in Q2 2021. This income relates to loan funding received in 2020 under the U.S. government's Paycheck Protection Program. Four Paycheck Protection Program loans received by the company in 2020, totaling $2.9 million, were forgiven during quarter two 2021 and have therefore been recognized as income this quarter. These four loans were treated as short-term liabilities at March 31st, 2021. Moving on to R&D expenditure, this decreased slightly to $1.1 million compared to $1.2 million in Q2 2020. Meanwhile, SG&A costs have increased from $5 million in Q2 2020 to $6.3 million in Q2 2021. It is important to note that SG&A expenses were unusually low in Q2 2020 due to the furloughing of employees as a result of the pandemic. Government payroll supports related to COVID-19, which are not available in 2021, and other cost savings. In addition, Q2 2021 SG&A costs reflect increased professional fees, plus additional sales and marketing team costs reflecting the expansion of our international sales and marketing team. These result in an operating profit for Q2 2021 of $6.3 million compared to $500,000 reported in Q2 2020, an increase of $5.8 million. This increase in operating profit is primarily driven by increased revenues and the forgiveness of the Paycheck Protection Programme loans, partially offset by higher SG&A expenses and a slightly lower margin. Moving on to financial expenses. This includes the quarterly cash interest cost for exchangeable notes of $1 million and $200,000 relates to notional finance charges associated with lease facilities. These notional finance charges are required by the relevant accounting standards IFRS 16. You will note that there is also non-cash financial net income of $900,000, which is made up of accretion interest of $100,000 in the accounting carrying value of the exchangeable notes less than 1 million fair value adjustments to derivatives embedded in the exchangeable notes as required by the relevant accounting standard. Profit after tax, before impairments, one-off items and non-cash financial expenses was $4.4 million compared to a loss of $800,000 in Q2 2020. As in prior and as set out in the press release, we quote earnings per edior, effectively our equivalent of EPS, on standard basis, and also before the impact of impairments, one-off charges, and non-cash financial items. Using that modified measure, earnings per ADR have increased to 21.2 cents from a loss of 3.6 cents in Q2 2020, while diluted earnings per ADR have also increased, in this case, to 20.3 cents from 1 cent in Q2 2020. I will now provide you with more information on the aforementioned impairment charge of $6.1 million. This charge results from the accounting standard-driven impairment review we are required to carry out under IFRS. There are a number of factors taken into account in calculating the impairment, including the company's period end share price, calculation of the company's cost of capital, and future projected cash flows from individual cash-generating units in the business. In addition, the company examines individual project costs for indicators of impairment. The non-cash impairment charge of 6.1 million has been recognized against the following assets. Intangible assets, $3.9 million, property, plant, and equipment of $1.9 million, and current assets of 300,000. I will now move on to talk about the significant balance sheet movement since the end of March 2021. There was a decrease in property, plant, and equipment of $2.1 million Additions in this quarter were $400,000, and this was offset by depreciation of $600,000 and the aforementioned impairment charge of $1.9 million. In the same period, our intangible assets decreased by $2.3 million. This was made up of additions of $1.8 million, offset by an amortization charge of $200,000 and an impairment charge of $3.9 million. Moving on to inventories, you would have seen we have decreased These have decreased by 2.9 million and now stand at 34.7 million. In Q1 2021, we reduced the level of production of our PCR viral transport media, VTM, in line with projected demand, and this is the main reason for the reduction in retreat this quarter. Meanwhile, trade and under-receivables have increased by 0.5 million to 15.4 million, reflecting slightly lower cash collections. Our trade and other payables reduced by 9.6 compared to March 2021. This reduction was mainly driven by the aforementioned forgiveness of the PPP loans and a reduction in trade creditors and accruals that the company paid VTM suppliers for previously supplied raw materials. By reducing the level of purchases of raw materials to reflect the reduced demand for new VTM orders as the quarter continues. You will see from the balance sheet that we have presented the exchange of a note's liability and the related embedded derivatives within current liabilities. Previously, this has been recorded within non-current liabilities. The reason for the change this quarter is because the notes have a put option on 1 April 2022. As the company does not have an unconditional right to defer settlement of the liability for at least 12 months after the reporting period, the accounting standards require us to show the exchange note as a current liability as at June 2021. Finally, I will discuss our cash flows for the quarter. Cash generation from operations during the quarter was $1.3 million. Non-operating cash outflows during the quarter included capital expenditure of $2.2 million and payments for property leases of $0.7 million. In addition, the company paid $2 million of interest on exchangeable notes. Overall, this resulted in a cash balance of $28.6 million at the end of Q2 2021. Thank you. I will now hand over to Ronan who will bring you through our revenues.

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Thanks, John. I'm now going to review the revenues for quarter two and for the corresponding quarter in 2020 before opening the question and answer session. Revenues for quarter two were $25.8 million compared with $16 million in the corresponding quarter, which is an increase of 61%. Point of care revenues in quarter two were $2 million compared with $1.3 million in the corresponding quarter, which is an increase of 55%. Despite this increase, our HIV revenues are lower than normalised levels due to delays in the issue of HIV rapid test orders from Africa as a result of COVID-19 and that is further exacerbated by difficulty procuring air freight transport into Africa. However, we are seeing evidence of these COVID-19 driven delays abating and we expect that point of care HIV revenues will quickly return to normalised levels. In March 2021, we announced that we had submitted our Trinscreen HIV product to the World Health Organization for approval. This product, once approved, will allow the company to enter for the first time the HIV screening market in Africa, which at 170 million tests annually is a 12-fold bigger market by value than the confirmatory test market, where Trinity Biotech has for many years had a dominant market share with our product Unigold. During the last week, the company received an update from the WHO on the approval process, where the WHO confirmed that the final assessment phase is now well advanced. The company is confident of receiving an approval over the next number of months and then quickly leveraging the quality of its product, given its advantages over the competition, given also its experienced sales and marketing team on the ground in Africa, given also our reputation for excellence with UniGold, and also given our high volume automated production capacity capability in Ireland. And we believe that all of these factors will enable us to quickly take market share in screening HIV African market. Moving now onto our clinical laboratory business, our revenues for quarter two were 23.9 million compared with 14.8 million in the corresponding quarter 2020, which is an increase of 62%. This increase is primarily explained by strong COVID-19 related product revenues with our PCR viral transport media product being the most significant contributor. We have developed and continue to develop a strong suite of COVID-19 related products. As just mentioned, our FDA approved PCR viral transport media product performed well during the quarter. It's a sample collection device for COVID-19 PCR molecular testing, which is used to store the nasopharyngeal swab, which contains the patient sample, allowing it to be transmitted in a stable environment. The transport medium stabilises the sample and prevents bacterial growth and maintains its integrity until such time as the test is run in the laboratory. In addition, the company has developed a COVID-19 ELISA automated antibody test, which is available for sale in the United States, which sells in modest volume. The company also developed another antibody test, which is a COVID-19 point-of-care antibody test, and in June it made an emergency use authorization application to the FDA for the test. However, disappointingly, the FDA informed the company that given the volume of EUA requests that it is not prior to prioritizing this type of test for review. Given the rapid adoption of COVID-19 vaccines and the focus on using evidence of vaccination rather than the presence of antibodies as proof of immunity, we believe that the use of antibody tests in this pandemic would be very limited and we will therefore make no further investment in antibody testing. Moving on then, as previously announced, the company is well advanced in the development of a COVID-19 rapid antigen test. Now, that's an antigen test as opposed to an antibody test. It uses a nasopharyngeal swab which will run in 12 minutes. The test will be manufactured in our automated manufacturing facility in Ireland with the cassette, which is virtually identical to that of both HIV Unigold and HIV Trinscreen. The test, which is largely developed, is demonstrating excellent analytical results, and the focus for the remainder of the development process will be on transfer to automated manufacture and to clinical validation. We now expect that we will have achieved CE mark during quarter two 2022, thereby enabling sale of the product throughout Europe. While we do expect to launch the product in the US, The regulatory path for such products remains fluid, and thus the company will continue to assess what may be the most appropriate regulatory approval pathway to allow a US launch of the product. However, we do expect that that will be achieved within a short number of months after European approval. Given the evidence of breakthrough infections for those vaccinated and a continuing threat, given the evidence of breakthrough infections for those vaccinated, and a continuing threat of new variants, we believe that rapid antigen testing will have a continuing place in the overall public health response to COVID-19, and that this will be a significant market for Trinity into the future. As previously stated, our increase in revenues is mainly due to strong revenues from our COVID-19 PCR viral transport media product. The company noted a significant reduction in demand for new orders of VTM during quarter one and quarter two of 2021, And despite a fluid situation, given delta and the fact that over the past few weeks we are seeing increased interest in the product, we believe that our VTM sales in quarter three will be significantly lower than the prior quarters. And now moving back to our core business. Comparison between this year's revenues and quarter two of 2020 is meaningless, given that there was a virtual total shutdown during quarter two of 2020. Moving to our haemoglobin A1C business, we continue to have low instrument placements with just over 30 instruments placed during the quarter, which is less than 50% of normal placement levels. This was expected as hospitals and clinics are unlikely to purchase new capital equipment during the pandemic. However, we are confident that these placements will fully recover in a post-pandemic environment. Meanwhile, haemoglobin reagent revenues and by this I mean the number of tests being run in our diabetes business are running at about 90% of normal, again due to the fact that patients are less likely to perform discretionary tests during the pandemic. Meanwhile, we anticipate launching our new midsize hemoglobin A1C instrument in early 2022. This instrument will enable us for the first time to target thousands of smaller hospitals and diabetes clinics around the world, mostly outside of the US and the EU. we had been unable to service this market as the processing capability of our premier instrument and also with its cost was too large for their requirements. Although we have designed and developed the instruments in Kansas City, it will be manufactured in China, thereby enabling us to make the instrument available in the market at a very attractive price. And lastly, our autoimmune business generated revenues approximately 7% lower than in the pre-pandemic environment with reference laboratory volumes down approximately 10% and product revenues marginally down. We believe that this is entirely due to the pandemic, as many patients defer doctor visits, and that's absolutely necessary, and we are confident that these revenues will fully recover post-pandemic. Could I now open the call to a question and answer session, please?

speaker
Jamie
Conference Operator

Ladies and gentlemen, at this time, we'll begin the question and answer session. To ask a question, you may press star and then 1 using a touch-tone telephone. To withdraw your questions, you may press star and 2. If you are using a speakerphone, we do ask that you please pick up your handset before pressing the keys to ensure the best sound quality. Once again, that is star and then 1 to join the question queue. Our first question today comes from Jim Sidotti from Sidotti and Company. Please go ahead with your question.

speaker
Jim Sidoti
Analyst, Sidoti & Company

Hi, good afternoon, Ronan and John. Can you hear me?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Hi, Jim. Yep. Hi, Jim.

speaker
John Gillard
Chief Financial Officer, Trinity Biotech

Having care?

speaker
Jim Sidoti
Analyst, Sidoti & Company

Great. Great. So it sounds like you're in the final stages with the WHO for Trinscreen. Is the WHO similar to the FDA in that you're not allowed to talk about the test with potential customers until the approval is is received, or can you start to market the device now ahead of the approval?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

You could start to market the device ahead of the approval, but, you know, I don't think you'd be taken very seriously in the individual countries without the approval being in place. So, I mean, you can kind of warm people up a little bit, but you can't really seriously market it as such.

speaker
Jim Sidoti
Analyst, Sidoti & Company

So how should we think about the ramp in sales for this new test? Is this something that's going to take a couple quarters to get going? Do you think you'll be able to get orders within the first quarter or so after you receive the approval?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Jim, unfortunately, it's not as simple as that. In order to have any meaningful sales, we will have to basically be – be put onto the algorithm for a particular country. So basically each individual African country, despite the fact they don't actually pay for the test themselves, they actually decide what products they'd like to use. And after that, then the Americans and the Europeans actually make the payments. So basically what happens is that the individual countries will decide what test, normally just one test would be the screening test, although they cancel it, And then they'll also decide what test will be the confirmatory test. And some countries review that every year, but typically it's every two years, right? And so, but it's not a kind of end of year, December thing. It's the varying times they review it. So in order to really, in order to actually basically sell in meaningful volume, you need to basically be put on the algorithm as the screener of choice for a particular individual country. So that will take time. But those algorithms have been reviewed all the time. So there's always algorithms in the melting pot and whatever. And in each individual country, we have a distributor and we are involved with opinion leaders and we have technical people on the ground. So we'll be working the system all the time as each algorithm comes up for review. But it's not a straight out of the park. It's not a straight, it's not like a, 100-meter race. It's not like you're straight out of the blocks.

speaker
Jim Sidoti
Analyst, Sidoti & Company

Understood. And then how will you handle ramping up production? Have you started to build some inventory yet, or are you going to wait until you actually receive some of these orders before you build up your inventory?

speaker
John Gillard
Chief Financial Officer, Trinity Biotech

Primarily, Jim, we'll wait until we receive orders or at least have, I suppose, a significant line of sight. As Ronan suggested, It's a relatively long sales process, but we're lucky to have a very experienced team, both from Unigold and also some kind of key people we've got on board. So we have the team that are able to make those kind of judgment calls in terms of how solid orders are. What we have been spending a lot of our time is optimizing our manufacturing process here in Ireland, to make sure that we can efficiently reach the levels of volume that we expect. So to Ronan's point earlier, the screening market is a much larger market. It's a much, much larger volume market. So in terms of our efficiency and the level of volumes for our plants here, it's really a step change for us, and that's really where we're putting our focus, to make sure that when those orders are ready, we are ready to be able to fulfill them.

speaker
Jim Sidoti
Analyst, Sidoti & Company

So is it reasonable for us to assume that you'll have some level of orders in 2022, assuming you get the approval in 2021?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Well, absolutely. Absolutely. We believe we will get moving very quickly. And we believe there's a couple of the bigger countries may actually decide to split the algorithm, as in for the screening, you know, to basically put us in alongside Abbott.

speaker
Jim Sidoti
Analyst, Sidoti & Company

Okay. And then similar question for the hemoglobin device, the new A1C tester. Do you think you'll have some revenue from that product in 2022, or is that going to be further out?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Yeah, that will be. But, I mean, it's difficult to estimate when we'll have the instrument fully approved. But, I mean, I think mid-2022 would be optimistic, you know, at that order of time frame.

speaker
Jim Sidoti
Analyst, Sidoti & Company

Got it. And then the last one for me, can you tell us – I'm sorry.

speaker
John Gillard
Chief Financial Officer, Trinity Biotech

Sorry, go ahead, Joe.

speaker
Jim Sidoti
Analyst, Sidoti & Company

Okay, can you tell us what the VTM sales were in the second quarter and how they compared to a year ago?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Well, I mean, I think our total COVID product sales would have been around seven and change in this quarter.

speaker
Jim Sidoti
Analyst, Sidoti & Company

Uh-huh. And where were you a year ago with that product? Were there any sales in June 2020?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Yeah, I think about $3.5 million. Okay. $3.5 million.

speaker
Jim Sidoti
Analyst, Sidoti & Company

All right, thank you.

speaker
Jamie
Conference Operator

Thank you. Once again, if you would like to ask your question, please press star and then 1. To withdraw your questions, you may press star and two. Our next question comes from Paul Norrie from Noble Equity. Please go ahead with your question.

speaker
Paul Norrie
Analyst, Noble Equity

Hey, good afternoon.

speaker
John Gillard
Chief Financial Officer, Trinity Biotech

Hi, Paul.

speaker
Paul Norrie
Analyst, Noble Equity

Did you say toward the end of your formal remarks that the COVID sales would be down for the third quarter?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Yeah, I did, Paul. Yeah, yeah. I mean, I think you're seeing this right across, I think you're possibly seeing this right across all diagnostic companies that basically more and more people are vaccinated. I mean, despite the fact that, you know, the Delta variant is proving very problematic, the reality is that the total volume of testing is actually dropping. And what you'd also seen, I think we've signaled, is that there was almost like panic buying towards the end of last year of PTMs and in general of COVID products. And so there was an element of, as an element of stockpiling that had to be kind of washed through a system. So having said that, on a positive, so despite the fact that we said that, I also indicated that we were seeing renewed levels of interest just in the last short number of weeks. Again, so a very fluid situation, but yeah, we have said that quarter three will be down.

speaker
John Gillard
Chief Financial Officer, Trinity Biotech

Paul, I think what you've seen is, you know, obviously towards the end of the quarter, as Ronan said, we're seeing increased interest. To what extent that interest manifests itself into significant orders towards the end of this quarter is just unclear at this point. But we clearly don't have a full quarter of that renewed interest.

speaker
Paul Norrie
Analyst, Noble Equity

Okay. And then for the autoimmune panel that you guys are running out of the lab. Is that posting any significant sales yet?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Oh, you mean actual COVID sales, like long COVID sales? No, that's only at the commencement stage, Paul. And then just remember I said to you that in general terms, our autoimmune laboratory volumes are probably down about 10%. And that's just because, again, you know, if people have a choice, they're going to stay away from a hospital or a doctor, you know. So the problem is pressing. They tend to get deferred. Go ahead. I was going to say, the long COVID products, we have a very interesting range of products, but they're very much just being rolled out as we speak, you know.

speaker
Paul Norrie
Analyst, Noble Equity

Yeah, what's going to be your strategy in terms of, creating awareness about it among physicians. I mean, it seems like the type of physician that could order, or that might order this kind of panel is just so wide ranging. So how might you go about marketing it?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Well, I mean, we have a US sales team involved in marketing those products. I mean, what we do is we do papers on it. We, academic papers, we try and talk to opinion leaders, get them interested, direct sales efforts as well. That's the kind of message we're using.

speaker
Paul Norrie
Analyst, Noble Equity

Okay. And I think you said earlier on the call that the sales team expanded. I was just wondering, is that in anticipation of the WHO approval or is that for your current product on the market?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

When we said that, we were referring only to Africa. So what's happened there basically is that Abbott, so the Allure, you know, had basically had a dominant position within African HIV screening, and they were acquired by Abbott a number of years ago, fairly recently. And basically what's happened is that we have managed to basically recruit the senior management team that developed the business for Allure. we have a really good team in place. So senior people off that team now work for us. And they're the people that basically, you know, managed to have a kind of, you know, who built that 85% market share for Allure, now Abbott. So that argument is that, you know, that we have a very, very experienced with the perfect, arguably the perfect marketing team. We have a good reputation with Unigold, the product itself, is performing excellently and is quicker than the Abbott test. I mean, the WHO ran their own trials, and they got 100% sensitivity and specificity on large sample sizes. And on top of that, we have this very sophisticated automated system in Ireland for manufacture, which can basically will be very easy, will respond easily to demand at any level. I think if you pull all those factors together, we're confident of taking I'm taking meaningful market share, but only the slightest kind of use of pricing. We'll only come in marginally below the number one there. All right, well, thank you. Thanks very much. Thanks, Paul. Thanks, Paul.

speaker
Jamie
Conference Operator

Once again, if you would like to ask a question, please press star and then one. To withdraw yourself from the question queue, you may press star and two. Our next question comes from Bill Lapp. Please go ahead with your question.

speaker
Bill Lapp
Analyst

Good morning. I got just several questions, Ronan. What is the pricing on the Allure product right now for the test in Africa?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

It recently moved from 80 cents to 90 cents. It's basically been 80 cents for about 12 years, and it moved in the last year to 90 cents.

speaker
Bill Lapp
Analyst

Okay. All right. Well, that sounds good. And you say there's 117 million of those tests a year?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Yeah, 170. Yep.

speaker
Bill Lapp
Analyst

Oh, 170, not 117. Better. Thank you for the clarification. I have another question on the COVID rapid antigen test. Now, you know, you've disbanded going forward for the antibody test, but you're still pursuing the antigen test. And it seems to me, you know, if you go to Target or some of these stores in the United States, you can get that test for $23 without going to the doctors. Now, they're talking about on TV yesterday at CNN about, you know, this guy from Harvard that's pushing vaccines. that you should get it quicker. And the United States, I believe, is going to really accelerate the testing. So, I mean, you have to go to a doctor to do your rapid test to get it done. And how are you going to compete? You're not even going to be in the ballgame until 2022. If you get there, you'll be in Europe, but you won't be in the United States. What's the thinking on this antigen test? I mean, you're already almost there, but your approval in the U.S. will be – at least a year away, correct?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Yeah, probably about a year away. I think by the time we get in, and the only reason, we can put a firm date on Europe because we know exactly what the regulatory pathway is. But, you know, in the USA, we're just being more cautious because, you know, the rules pertaining to the EUA, the emergency use authorization, and then the notification status have changed. and change and change regularly. And, for example, we're in a situation where on EUA notification basis we can sell our antibody test, but when we submitted the rapid antibody test, you know, they said that they didn't want to review it. So, you know, we're just being cautious when we say, we're just saying we're not certain of what the pathway is because the pathway is tending to change. But there's a huge market in Europe for it. for the antigen tests. And we believe, although we're coming late to market, we're coming with something of really high quality. In terms of pricing, we can manufacture it arguably in around 50 cents, you know, and therefore, you know, there'd be very strong margin on it. Whether the product is run by a doctor or individually, I think it's kind of almost like a sideshow. In some jurisdictions you can do some, but typically it doesn't have to be run by a doctor. But there are many instances where it can be run from home. As you know, many employers are doing it. My own daughter is working in London in Goldman Sachs. She's tested three times a week with an ancient test every week from month and end. So I think COVID is with us. We could debate the characteristics of COVID and how long it will endure. But I do believe, we believe within this company that antigen testing is going to be with us for an extended period of time. I extended that into years. And although we're coming to the party late, we believe that we have an excellent test.

speaker
Bill Lapp
Analyst

Okay. And is it 12 minutes faster? I mean, that's a pretty fast test. But it doesn't have to be administered in a doctor's office. Are you now telling me I could buy that kit and administer it at home or the employer can? You don't need a clinician to do it?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

It depends. It depends on the jurisdiction. It depends on the rules. I mean, you know, obviously there's lots of antigen tests available for home use. And then there's tests where you can take the swab and you post it. And then, you know, the result is run in a lab. So there's various ways of doing this. Suffice it to say, there's a very big market for antigen testing. I mean, they're selling millions and millions and millions.

speaker
Bill Lapp
Analyst

And are they currently selling antigen rapid tests in Europe? Quite a bit. They are, right?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Yeah. I mean, I was just interested in Goldman Sachs in London, 8,000 employees, and they're all tested three times a week. Right. There's 24,000. There's many employers doing that. Okay. But there's many examples.

speaker
Bill Lapp
Analyst

And what are they using for their antigen tests? Are they just – do you know what tests they're using? Is it a –

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Mostly Chinese tests. Mostly Chinese tests. Yeah. And remember, all flights in and out of the UK require antigen tests now. Okay. All right. Well... From the UK in and out of Europe requires an antigen test when you return back into the country. So, you know, there's lots... Believe me, there's endless antigen test requirements.

speaker
John Gillard
Chief Financial Officer, Trinity Biotech

I think the way we think about it, Bill, is, you know... the position has shifted again somewhat. Given the level of breakthrough infections, you know, vaccination is no longer the strong signal that it was expected to be in terms about somebody not having COVID. And that can be either in terms of, you know, comfort from yourself, comfort to your employer, comfort to your coworkers, comfort to your co-travelers around being free from infections. And I suppose the antigen test, we've seen, you know, lots of examples of employers pushing it, et cetera, is a way for people to get a level of comfort that they are not infectious or the people around them are not infectious. And I suppose, you know, just a short time ago, we thought that vaccination was probably going to give that level of comfort. But with the Delta variant and the level of breakthrough infections, That doesn't seem to be the case anymore. That's probably the key driver as to why we think there'll be greater longevity in this test, these types of tests, than we would have just a short while ago.

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Just some other examples, Bill, like, for example, in Dublin, Google and Facebook and Salesforce.com, as I understand it, are all testing their employees weekly. And, for example, also, I'm sure you're reading about this, I'm not so much on top of it, but, for example, in Europe, admittance to concerts and to all sorts of social events require an antigen test.

speaker
Bill Lapp
Analyst

Really? Okay. All right. Well, with that, so, I mean, it's still something that's more of a bonus, but your real excitement is the WHO. You said that's your most exciting thing you've got going. I mean, besides other things that could really make a change.

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

I think we're excited about both.

speaker
Bill Lapp
Analyst

Okay. Okay. Well, that's good. All right, and there's nothing you can say further on the refinancing of the $100 million loan at this point, right? Is there anything further you can add?

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Well, we've appointed professional advisors, and we're confident there are a number of options available to us to deal with the matter. But as you can imagine, it's very much in our thoughts and in the thoughts of the board, and we're working diligently on it.

speaker
Bill Lapp
Analyst

Okay. All right. Okay. Well, thanks so much.

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Thank you.

speaker
Bill Lapp
Analyst

Appreciate the quarter.

speaker
Ronan O'Keefe
Chairman and Chief Executive Officer, Trinity Biotech

Thanks, Bill. Lovely to talk to you. Thank you. Thank you, Bill. There appears to be no more questions, so I think maybe we'll close the call. And thank you, everybody, and thanks for your support and your interest, and talk to you soon.

speaker
John Gillard
Chief Financial Officer, Trinity Biotech

Thanks, everybody. Have a good day. Bye.

speaker
Jamie
Conference Operator

Ladies and gentlemen, the conference has now concluded. We do thank you for attending today's presentation. You may now disconnect your lines.

Disclaimer

This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.

-

-