Quidel Reports Second Quarter 2008 Results

Year-to-Date Net Income Increased 159% on a 20% Increase in
Revenues
SAN DIEGO--(Business Wire)--
Quidel Corporation (NASDAQ:QDEL), a leader in point-of-care rapid
diagnostic tests, today announced financial results for the quarter
and six months ended June 30, 2008.

Second Quarter and Year-to-Date 2008 Highlights:

-- Global revenues were $21.9 million, an 18 percent increase
over the prior year's second quarter

-- Gross margins in the second quarter expanded to 53 percent
from 50 percent year-over-year

-- Net loss declined to $0.5 million from $1.7 million last year,
or to a loss per share of $0.02 from $0.05 year-over-year

-- Year-to-date global revenues grew 20 percent to $62.8 million
over the prior year

-- Year-to-date operating income increased 172 percent to $12.5
million

-- Signed agreement with Prodesse, Inc. for the joint promotion
of Prodesse's ProFlu+(TM) molecular diagnostic test

-- Began product shipments to new international distribution
partner, bioMerieux

Second Quarter 2008 Results

For the second quarter of 2008, total revenues increased 18
percent to $21.9 million, compared to $18.6 million for the second
quarter of 2007. The increase in revenues was driven in part by strong
international growth from the infectious disease QuickVue(R) product
family and a strategic sales initiative launched with several domestic
distributors. The net loss for the second quarter was $0.5 million, or
$0.02 per share, compared to a net loss of $1.7 million, or $0.05 per
share, for the prior-year second quarter.

Gross margin for the 2008 second quarter increased to 53 percent
from 50 percent for the same period in 2007. Improvement in gross
margin was primarily due to leveraging Quidel's automated web
manufacturing process on an increase in unit volume. Operating
expenses for the second quarter 2008 were $12.8 million, compared to
$12.4 million for the prior-year second quarter. Stock-based
compensation expense was $0.9 million for the second quarter of 2008,
compared to $1.2 million for the second quarter of last year.

"Quidel's solid second quarter results reflect our continued
ability to deliver revenue growth and margin expansion through the
global strength of our QuickVue brand. We have achieved meaningful
gross margin improvements by leveraging our manufacturing operations
and optimizing our Quidel Value Build-based marketing strategies. We
remain confident that our brand strength and market position have
never been stronger across our entire product portfolio," said Caren
Mason, Quidel's president and chief executive officer. "In addition,
as part of our longer-term strategy to bolster our leading position in
diagnostics, in the second quarter, we agreed to co-promote Prodesse's
ProFlu+ molecular diagnostic product for the upcoming flu season. Our
planning for the upcoming flu season is underway and we believe we are
well positioned to maximize our share of the available market."

Year-to-Date Results

Total revenues for the first six months of 2008 were $62.8
million, an increase of 20 percent over total revenues of $52.5
million for the first six months of 2007. Net income increased 159
percent in the first half of 2008 to $8 million, or $0.25 per diluted
share, from net income of $3.1 million, or $0.09 per diluted share, in
the first half of 2007. Gross margin was 61 percent, compared to 58
percent in the comparable period in 2007. Improvement in gross margin
is attributed to improved manufacturing efficiencies and higher
margins on flu products sold internationally. Operating expenses in
the first six months of 2008 were $25.9 million, compared to $25.7
million in the first six months of 2007. Stock-based compensation
expense was $1.9 million for the first six-month period in 2008,
compared to $2.4 million in the comparable period in 2007.

Liquidity

During 2008, Quidel has repurchased approximately 468,100 shares
of its common stock for $6.7 million under the Company's previously
announced share repurchase program. A total of $14.7 million remains
available for stock repurchase under the program. Even after the
effect of the stock repurchase, cash and cash equivalents as of June
30, 2008, were $61.1 million.

Conference Call Information

Quidel management will host a conference call to discuss these
topics as well as other business matters today beginning at 5:00 p.m.
Eastern time (2:00 p.m. Pacific time). During the conference call, the
Company may answer questions concerning business and financial
developments and trends, and other business and financial matters. The
Company's responses to these questions, as well as other matters
discussed during the conference call, may contain or constitute
information that has not been previously disclosed.

To participate in the live call by telephone from the U.S., dial
(888) 561-2601, or from outside the U.S., dial (617) 614-3518, and
enter the passcode 70192621. A live webcast of the call can be
accessed at www.quidel.com and the Web site replay will be available
until August 6, 2008. The telephone replay will be available for 48
hours beginning today at 7:00 p.m. ET (4:00 p.m. PT) by dialing (888)
286-8010 from the U.S., or (617) 801-6888 for international callers,
and entering passcode 88520531.

About Quidel Corporation

Quidel Corporation serves to enhance the health and well being of
people around the globe through the discovery, development,
manufacturing and marketing of rapid diagnostic solutions at the point
of care (POC) in infectious diseases and reproductive health. Marketed
under the leading brand name of QuickVue(R), Quidel's portfolio of
products currently includes tests that aid in the diagnosis of several
disease or condition states, including influenza, respiratory
syncytial virus, Fecal Occult Blood, Strep A, pregnancy, bacterial
vaginosis, H. pylori and Chlamydia. Quidel's products are sold to
healthcare professionals with a focus on the physician office lab and
acute care markets through leading medical distribution partners on a
worldwide basis. Quidel's Specialty Products Group (SPG) develops
research products in the fields of oncology and bone health with
potential future point-of-care applications. By building value in
rapid diagnostic tests, Quidel provides leadership to the industry and
among healthcare professionals allowing for the movement of patient
testing out of the central laboratory setting and into the physician
office, urgent care and other outpatient settings where rapid testing
and treatment have an impact on clinical outcomes and provide an
economic benefit. For more information, visit www.quidel.com,
www.colorectal-test.com or www.flutest.com.

This press release contains forward-looking statements within the
meaning of the federal securities laws that involve material risks,
assumptions and uncertainties. Many possible events or factors could
affect our future financial results and performance, such that our
actual results and performance may differ materially. As such, no
forward-looking statement can be guaranteed. Differences in actual
results and performance may arise as a result of a number of factors
including, without limitation, seasonality, the timing of onset,
length and severity of cold and flu seasons, uncertainty surrounding
the detection of novel influenza viruses involving human specimens,
adverse changes in the competitive and economic conditions in domestic
and international markets, actions of our major distributors and the
level of success in our recent distributor incentive programs,
technological changes and uncertainty with research and technology
development, including any future molecular-based technology, the
reimbursement system currently in place and future changes to that
system, manufacturing and production delays or difficulties, adverse
actions or delays in product reviews by the U.S. Food and Drug
Administration (the "FDA"), intellectual property, product liability,
environmental or other litigation, required patent license fee
payments not currently reflected in our costs, potential inadequacy of
booked reserves and possible impairment of goodwill, and
lower-than-anticipated sales or market penetration of our new
products. Forward-looking statements typically are identified by the
use of terms such as "may," "will," "should," "might," "expect,"
"anticipate," "estimate," and similar words, although some
forward-looking statements are expressed differently. The risks
described under "Risk Factors" in reports and registration statements
that we file with the SEC from time to time should be carefully
considered. You are cautioned not to place undue reliance on these
forward-looking statements, which reflect management's analysis only
as of the date of this press release. We undertake no obligation to
publicly release the results of any revision or update of the
forward-looking statements.

-0-
*T

QUIDEL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)

Three months ended Year to date
June 30, June 30,
2008 2007 2008 2007
------------------- -----------------
(unaudited) (unaudited)

Total revenues $ 21,916 $ 18,580 $62,781 $52,514

Cost of sales (excludes
amortization of intangible
assets) 10,242 9,316 24,369 22,268
Research and development 2,935 3,282 6,002 6,646
Sales and marketing 5,591 4,729 10,911 9,384
General and administrative 3,098 3,117 6,737 6,813
Amortization of intangibles 1,143 1,298 2,294 2,822
--------- --------- -------- --------

Total costs and expenses 23,009 21,742 50,313 47,933
--------- --------- -------- --------

Income (loss) from operations (1,093) (3,162) 12,468 4,581

Interest expense (169) (193) (344) (376)
Interest income 426 490 957 932
Other, net - 36 (15) (4)
--------- --------- -------- --------

Total other income 257 333 598 552
--------- --------- -------- --------

Income (loss) before taxes (836) (2,829) 13,066 5,133

Income tax expense (benefit) (323) (1,117) 5,029 2,028
--------- --------- -------- --------

Net income (loss) $ (513) $ (1,712) $ 8,037 $ 3,105
========= ========= ======== ========

Basic earnings (loss) per share: $ (0.02) $ (0.05) $ 0.25 $ 0.10
Diluted earnings (loss) per
share: $ (0.02) $ (0.05) $ 0.25 $ 0.09

Weighted shares used in basic
per share calculation 31,757 31,682 31,879 32,178
Weighted shares used in diluted
per share calculation 31,757 31,682 32,681 33,156

Gross profit as a % of total
revenues 53% 50% 61% 58%
Research and development as a %
of total revenues 13% 18% 10% 13%
Sales and marketing as a % of
total revenues 26% 25% 17% 18%
General and administrative as a
% of total revenues 14% 17% 11% 13%
Income from operations as a % of
total revenues N/A N/A 20% 9%

Condensed balance sheet data
(in thousands): 6/30/08 12/31/07
--------- ---------

Cash and cash equivalents $ 61,127 $ 45,489
Working capital 82,225 70,259
Total assets 132,630 133,838
Long term obligations 8,659 9,161
Stockholders' equity 112,142 107,703
*T

Quidel Corporation
John M. Radak, Chief Financial Officer, 858-646-8032
or
Porter Novelli Life Sciences
Shirley Chow, 212-601-8308
schow@pnlifesciences.com

Copyright Business Wire 2008