Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2024 | May 02, 2024 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-39725 | |
Entity Registrant Name | Maravai LifeSciences Holdings, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 85-2786970 | |
Entity Address, Address Line One | 10770 Wateridge Circle | |
Entity Address, Address Line Two | Suite 200 | |
Entity Address, City or Town | San Diego | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92121 | |
City Area Code | 858 | |
Local Phone Number | 546-0004 | |
Title of 12(b) Security | Class A common stock, $0.01 par value | |
Trading Symbol | MRVI | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001823239 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 132,830,872 | |
Class B Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 119,094,026 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 561,691 | $ 574,962 |
Accounts receivable, net | 36,685 | 54,605 |
Inventory | 49,846 | 51,397 |
Prepaid expenses and other current assets | 16,818 | 17,830 |
Government funding receivable | 2,844 | 1,118 |
Total current assets | 667,884 | 699,912 |
Property and equipment, net | 161,628 | 162,900 |
Goodwill | 326,029 | 326,029 |
Intangible assets, net | 214,118 | 220,987 |
Other assets | 74,982 | 77,622 |
Total assets | 1,444,641 | 1,487,450 |
Current liabilities: | ||
Accrued expenses and other current liabilities | 35,405 | 60,237 |
Deferred revenue | 2,210 | 3,360 |
Current portion of long-term debt | 5,440 | 5,440 |
Current portion of finance lease liabilities | 672 | 633 |
Total current liabilities | 59,022 | 87,468 |
Long-term debt, less current portion | 517,893 | 518,707 |
Finance lease liabilities, less current portion | 31,714 | 31,897 |
Other long-term liabilities | 58,623 | 59,494 |
Total liabilities | 667,252 | 697,566 |
Commitments and contingencies (Note 6) | ||
Stockholders’ equity: | ||
Additional paid-in capital | 134,482 | 128,503 |
Retained earnings | 273,659 | 285,737 |
Total stockholders’ equity attributable to Maravai LifeSciences Holdings, Inc. | 410,659 | 416,753 |
Non-controlling interest | 366,730 | 373,131 |
Total stockholders’ equity | 777,389 | 789,884 |
Total liabilities and stockholders’ equity | 1,444,641 | 1,487,450 |
Class A Common Stock | ||
Stockholders’ equity: | ||
Common stock | 1,327 | 1,322 |
Class B Common Stock | ||
Stockholders’ equity: | ||
Common stock | 1,191 | 1,191 |
Nonrelated Party | ||
Current liabilities: | ||
Accounts payable | 8,226 | 10,729 |
Related Party | ||
Current liabilities: | ||
Accounts payable | $ 7,069 | $ 7,069 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Class A Common Stock | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000 | 500,000 |
Common stock, shares issued (in shares) | 132,655 | 132,228 |
Common stock, shares outstanding (in shares) | 132,655 | 132,228 |
Class B Common Stock | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 300,000 | 300,000 |
Common stock, shares issued (in shares) | 119,094 | 119,094 |
Common stock, shares outstanding (in shares) | 119,094 | 119,094 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||
Revenue | $ 64,179 | $ 79,025 |
Operating expenses: | ||
Cost of revenue | 38,335 | 33,676 |
Selling, general and administrative | 40,885 | 38,671 |
Research and development | 5,032 | 4,145 |
Restructuring | (1,212) | 0 |
Total operating expenses | 83,040 | 76,492 |
(Loss) income from operations | (18,861) | 2,533 |
Other income (expense): | ||
Interest expense | (10,864) | (11,833) |
Interest income | 7,210 | 6,045 |
Change in payable to related parties pursuant to the Tax Receivable Agreement | 0 | (1,436) |
Other income | 106 | 168 |
Loss before income taxes | (22,409) | (4,523) |
Income tax expense (benefit) | 271 | (3,175) |
Net loss | (22,680) | (1,348) |
Net loss attributable to non-controlling interests | (10,602) | (1,281) |
Net loss attributable to Maravai LifeSciences Holdings, Inc. | $ (12,078) | $ (67) |
Net loss per Class A common share attributable to Maravai LifeSciences Holdings, Inc., basic (in usd per share) | $ (0.09) | $ 0 |
Net loss per Class A common share attributable to Maravai LifeSciences Holdings, Inc., diluted (in usd per share) | $ (0.09) | $ 0 |
Weighted average number of Class A common shares outstanding, basic (in shares) | 132,333 | 131,739 |
Weighted average number of Class A common shares outstanding, diluted (in shares) | 132,333 | 131,739 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (22,680) | $ (1,348) |
Comprehensive loss attributable to non-controlling interests | (10,602) | (1,281) |
Total comprehensive loss attributable to Maravai LifeSciences Holdings, Inc. | $ (12,078) | $ (67) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY - USD ($) shares in Thousands | Total | Class A Common Stock | Class B Common Stock | Common Stock Class A Common Stock | Common Stock Class B Common Stock | Additional Paid-In Capital | Retained Earnings | Non-Controlling Interest |
Beginning balance (in shares) at Dec. 31, 2022 | 131,692 | 123,669 | ||||||
Beginning balance at Dec. 31, 2022 | $ 905,243,000 | $ 1,317,000 | $ 1,237,000 | $ 137,898,000 | $ 404,766,000 | $ 360,025,000 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Effects of Structuring Transactions (in shares) | (4,575) | |||||||
Effects of Structuring Transactions | (2,000) | $ (46,000) | (26,348,000) | 26,392,000 | ||||
Issuance of Class A common stock under employee equity plans, net of shares withheld for employee taxes (in shares) | 97 | |||||||
Issuance of Class A common stock under employee equity plans, net of shares withheld for employee taxes | (940,000) | $ 1,000 | (496,000) | (445,000) | ||||
Non-controlling interest adjustment for changes in proportionate ownership in Topco LLC | 0 | 122,000 | (122,000) | |||||
Stock-based compensation | 5,987,000 | 3,133,000 | 2,854,000 | |||||
Distribution for tax liabilities to non-controlling interest holder | (8,302,000) | (8,302,000) | ||||||
Net loss | (1,348,000) | (67,000) | (1,281,000) | |||||
Ending balance (in shares) at Mar. 31, 2023 | 131,789 | 119,094 | ||||||
Ending balance at Mar. 31, 2023 | 900,638,000 | $ 1,318,000 | $ 1,191,000 | 114,309,000 | 404,699,000 | 379,121,000 | ||
Beginning balance (in shares) at Dec. 31, 2023 | 132,228 | 119,094 | 132,228 | 119,094 | ||||
Beginning balance at Dec. 31, 2023 | 789,884,000 | $ 1,322,000 | $ 1,191,000 | 128,503,000 | 285,737,000 | 373,131,000 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of Class A common stock under employee equity plans, net of shares withheld for employee taxes (in shares) | 427 | |||||||
Issuance of Class A common stock under employee equity plans, net of shares withheld for employee taxes | (1,872,000) | $ 5,000 | (1,877,000) | |||||
Non-controlling interest adjustment for changes in proportionate ownership in Topco LLC | 0 | 1,510,000 | (1,510,000) | |||||
Stock-based compensation | 12,057,000 | 6,346,000 | 5,711,000 | |||||
Distribution for tax liabilities to non-controlling interest holder | 0 | |||||||
Net loss | (22,680,000) | (12,078,000) | (10,602,000) | |||||
Ending balance (in shares) at Mar. 31, 2024 | 132,655 | 119,094 | 132,655 | 119,094 | ||||
Ending balance at Mar. 31, 2024 | $ 777,389,000 | $ 1,327,000 | $ 1,191,000 | $ 134,482,000 | $ 273,659,000 | $ 366,730,000 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Operating activities: | ||
Net loss | $ (22,680) | $ (1,348) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Depreciation | 4,786 | 2,080 |
Amortization of intangible assets | 6,869 | 6,765 |
Amortization of operating lease right-of-use assets | 2,098 | 2,062 |
Amortization of deferred financing costs | 740 | 719 |
Stock-based compensation expense | 12,057 | 5,987 |
Deferred income taxes | 0 | (1,520) |
Revaluation of liabilities under the Tax Receivable Agreement | 0 | 1,436 |
Change in fair value of derivative instruments | (1,919) | 878 |
Other | 223 | (326) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 17,883 | 82,407 |
Inventory | 820 | (3,383) |
Prepaid expenses and other assets | 730 | (23,012) |
Accounts payable | (3,682) | (235) |
Accrued expenses and other current liabilities | (24,116) | 24,225 |
Deferred revenue | (1,150) | (1,058) |
Other long-term liabilities | (1,126) | (10,603) |
Net cash (used in) provided by operating activities | (8,467) | 85,074 |
Investing activities: | ||
Cash paid for acquisition of a business, net of cash acquired | 0 | (69,731) |
Purchases of property and equipment | (5,665) | (7,868) |
Proceeds from government assistance allocated to property and equipment | 1,421 | 8,028 |
Prepaid lease payments on finance lease yet to commence | 0 | (159) |
Net cash used in investing activities | (4,244) | (69,730) |
Financing activities: | ||
Distributions for tax liabilities to non-controlling interest holders | 0 | (8,302) |
Principal repayments of long-term debt | (1,360) | (1,360) |
Payments of finance lease liabilities | (145) | 0 |
Proceeds from derivative instruments | 2,378 | 492 |
Payment of acquisition consideration holdback | 0 | (9,706) |
Taxes paid for shares withheld under employee equity plans, net of proceeds from issuance of Class A common stock | (1,433) | (333) |
Net cash used in financing activities | (560) | (19,209) |
Net decrease in cash and cash equivalents | (13,271) | (3,865) |
Cash and cash equivalents, beginning of period | 574,962 | 632,138 |
Cash and cash equivalents, end of period | 561,691 | 628,273 |
Supplemental cash flow information: | ||
Cash paid for interest | 12,140 | 9,593 |
Cash paid (refunded) for income taxes, net | 197 | (521) |
Supplemental disclosures of non-cash activities: | ||
Property and equipment included in accounts payable and accrued expenses | 3,162 | 1,175 |
Prepaid lease payments on finance lease yet to commence included in accounts payable and accrued expenses | 0 | 20,552 |
Accrued receivable for capital expenditures to be reimbursed under a government contract | 2,844 | 616 |
Right-of-use assets obtained in exchange for new finance lease liabilities | 0 | 17,067 |
Right-of-use assets obtained in exchange for new operating lease liabilities | 0 | 3,931 |
Fair value of contingent consideration liability recorded in connection with acquisition of a business | $ 0 | $ 5,289 |
Organization and Significant Ac
Organization and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Significant Accounting Policies | Organization and Significant Accounting Policies Description of Business Maravai LifeSciences Holdings, Inc. (the “Company”, and together with its consolidated subsidiaries, “Maravai”, “we”, “us”, and “our”) provides critical products to enable the development of drugs, therapeutics, diagnostics, vaccines and support research on human diseases. Our products address the key phases of biopharmaceutical development and include complex nucleic acids for diagnostic and therapeutic applications and antibody-based products to detect impurities during the production of biopharmaceutical products. The Company was incorporated as a Delaware corporation in August 2020 and is headquartered in San Diego, California. We have two principal businesses: Nucleic Acid Production and Biologics Safety Testing. Our Nucleic Acid Production business manufactures and sells products used in the fields of gene therapy, vaccines, nucleoside chemistry, oligonucleotide therapy and molecular diagnostics, including reagents used in the chemical synthesis, modification, labelling and purification of deoxyribonucleic acid (“DNA”) and ribonucleic acid (“RNA”). Our core Nucleic Acid Production offerings include messenger ribonucleic acid (“mRNA”), long and short oligonucleotides, our proprietary CleanCap® capping technology and oligonucleotide building blocks, and custom enzyme development and manufacturing. Our Biologics Safety Testing business sells highly specialized analytical products for use in biologic manufacturing process development, including custom product-specific development antibody and assay development services. Basis of Presentation The Company operates and controls all of the business and affairs of Topco LLC, and, through Topco LLC and its subsidiaries, conducts its business. Because we manage and operate the business and control the strategic decisions and day-to-day operations of Topco LLC and also have a substantial financial interest in Topco LLC, we consolidate the financial results of Topco LLC, and a portion of our net loss is allocated to the non-controlling interests in Topco LLC held by MLSH 1. The accompanying unaudited interim condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and accounts between the businesses comprising the Company have been eliminated in the accompanying consolidated financial statements. Unaudited Interim Condensed Consolidated Financial Statements The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to Form 10-Q of Regulation S-X of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These unaudited condensed consolidated financial statements include all adjustments necessary to fairly state the financial position and the results of our operations and cash flows for interim periods in accordance with GAAP. All such adjustments are of a normal, recurring nature. Operating results for the three months ended March 31, 2024 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2024 or for any future period. The condensed consolidated balance sheet presented as of December 31, 2023 has been derived from the audited consolidated financial statements as of that date. The condensed consolidated financial statements and notes are presented as permitted by Form 10-Q and do not contain all information that is included in the annual financial statements and notes thereto of the Company. The condensed consolidated financial statements and notes included in this report should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 (“2023 Form 10-K”) filed with the SEC. Use of Estimates The preparation of consolidated financial statements in accordance with GAAP requires the Company to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, equity, revenue and expenses, and related disclosures. These estimates form the basis for judgments the Company makes about the carrying values of assets and liabilities that are not readily apparent from other sources. The Company bases its estimates and judgments on historical experience and on various other assumptions that the Company believes are reasonable under the circumstances. These estimates are based on management’s knowledge about current events and expectations about actions the Company may undertake in the future. Significant estimates include, but are not limited to, the measurement of right-of-use assets and lease liabilities and related incremental borrowing rate, the payable to related parties pursuant to the Tax Receivable Agreement (as defined in Note 10), the realizability of our net deferred tax assets, and the valuation of goodwill and intangible assets acquired in business combinations. Actual results could differ materially from those estimates. Significant Accounting Policies A description of the Company’s significant accounting policies is included in Note 1 of the Notes to the Consolidated Financial Statements included in the 2023 Form 10-K. There have been no material changes in the Company’s significant accounting policies during the three months ended March 31, 2024. Revenue Recognition The Company generates revenue primarily from the sale of products, and to a much lesser extent, services in the fields of nucleic acid production and biologics safety testing. Products are sold primarily through a direct sales force and through distributors in certain international markets where the Company does not have a direct commercial presence. Revenue is recognized when control of promised goods or services is transferred to a customer or distributor in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Distributors are the principal in all sales transactions with our customers. To determine revenue recognition for its arrangements with customers, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The majority of the Company’s contracts include only one performance obligation. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is defined as the unit of account for revenue recognition. The Company also recognizes revenue from other contracts that may include a combination of products and services, the provision of solely services, or from license fee arrangements which may be associated with the delivery of product. Where there is a combination of products and services, the Company accounts for the promises as individual performance obligations if they are concluded to be distinct. Performance obligations are considered distinct if they are both capable of being distinct and distinct within the context of the contract. In determining whether performance obligations meet the criteria for being distinct, the Company considers a number of factors, such as the degree of interrelation and interdependence between obligations, and whether or not the good or service significantly modifies or transforms another good or service in the contract. As a practical expedient, we do not adjust the transaction price for the effects of a significant financing component if, at contract inception, the period between customer payment and the transfer of goods or services is expected to be one year or less. Contracts with customers are evaluated on a contract-by-contract basis as contracts may include multiple types of goods and services as described below. The Company recognizes revenue from sales to customers through distributors consistently with the policies and practices for direct sales to customers, as described above. Nucleic Acid Production Nucleic Acid Production revenue is generated from the manufacture and sale of highly modified, complex nucleic acids products to support the needs of our customers’ research, therapeutic and vaccine programs. The primary offering of products includes CleanCap®, mRNA, specialized oligonucleotides, and enzymes. Contracts typically consist of a single performance obligation. We also sell nucleic acid products for labeling and detecting proteins in cells and tissue samples research. The Company recognizes revenue from these products in the period in which the performance obligation is satisfied by transferring control to the customer or distributor. Revenue for nucleic acid catalog products is recognized at a single point in time, generally upon shipment to the customer or distributor. Revenue for contracts for certain custom nucleic acid products, with an enforceable right to payment and a reasonable margin for work performed to date, is recognized over time, based on a cost-to-cost input method over the manufacturing period. Payments received from customers in advance of manufacturing their products is recorded as deferred revenue until the products are delivered. Biologics Safety Testing The Company’s Biologics Safety Testing revenue is associated with the sale of host cell protein, bioprocess impurity detection, viral clearance prediction kits, and associated products. We also enter into contracts that include custom antibody development, assay development, antibody affinity extraction and mass spectrometry services. These products and services enable the detection of impurities that occur in the manufacturing of biologic drugs and other therapeutics including cell and gene therapies. The Company recognizes revenue from the sale of kits and products in the period in which the performance obligation is satisfied by transferring control to the customer or distributor. Custom antibody development contracts consist of a single performance obligation, typically with an enforceable right to payment and a reasonable margin for work performed to date. Revenue is recognized over time based on a cost-to-cost input method over the contract term. Where an enforceable right to payment does not exist, revenue is recognized at a point in time when control is transferred to the customer. Assay development service contracts consist of a single performance obligation. Revenue is recognized at a point in time when a successful antigen test and report is provided to the customer. Affinity extraction, mass spectrometry and other analytical services, which generally occur over a short period of time, consist of a single performance obligation to perform the service and provide a summary report to the customer. Revenue is recognized upon delivery of the report to the customer. The Company elected the practical expedient to not disclose the unfulfilled performance obligations for contracts with an original length of one year or less. The Company had no material unfulfilled performance obligations for contracts with an original length greater than one year for any period presented. The Company accepts returns only if the products do not meet specifications, and historically, the Company’s volume of product returns has not been significant. Further, no warranties are provided for promised goods and services other than assurance type warranties. Revenue for an individual contract is recognized at the related transaction price, which is the amount the Company expects to be entitled to in exchange for transferring the products and/or services. The transaction price for product sales is calculated at the contracted product selling price. The transaction price for a contract with multiple performance obligations is allocated to the separate performance obligations on a relative standalone selling price basis. Standalone selling prices for products are determined based on the prices charged to customers, which are directly observable. Standalone selling price of services are mostly based on time and materials. Generally, payments from customers are due when goods and services are transferred. As most contracts contain a single performance obligation, the transaction price is representative of the standalone selling price charged to customers. Revenue is recognized only to the extent that it is probable that a significant reversal of the cumulative amount recognized will not occur in future periods. Variable consideration has not been material to our consolidated financial statements. Sales taxes Sales taxes collected by the Company are not included in the transaction price as revenue as they are ultimately remitted to a governmental authority. Shipping and handling costs The Company has elected to account for shipping and handling activities related to contracts with customers as costs to fulfill the promise to transfer the associated products. Accordingly, revenue for shipping and handling is recognized at the same time that the related product revenue is recognized. Contract costs The Company recognizes the incremental costs of obtaining contracts as an expense when incurred when the amortization period of the assets that otherwise would have been recognized is one year or less. These costs are included in sales and marketing and general and administrative expenses. The costs to fulfill the contracts are determined to be immaterial and are recognized as an expense when incurred. Contract balances Contract assets are generated when contractual billing schedules differ from revenue recognition timing and the Company records a contract receivable when it has an unconditional right to consideration. There were no contract asset balances as of March 31, 2024 or December 31, 2023. Contract liabilities include billings in excess of revenue recognized, such as customer deposits and deferred revenue. Customer deposits, which are included in accrued expenses and other current liabilities, are recorded when cash payments are received or due in advance of performance. Deferred revenue is recorded when the Company has unsatisfied performance obligations. Total contract liabilities were $4.2 million and $5.5 million as of March 31, 2024 and December 31, 2023, respectively. Contract liabilities are expected to be recognized as revenue within the next twelve months. Disaggregation of revenue The following tables summarize the revenue by segment and region for the periods presented (in thousands): Three Months Ended March 31, 2024 Nucleic Acid Production Biologics Safety Testing Total North America $ 26,278 $ 7,093 $ 33,371 Europe, the Middle East and Africa 4,740 4,625 9,365 Asia Pacific 14,911 6,225 21,136 Latin and Central America 87 220 307 Total revenue $ 46,016 $ 18,163 $ 64,179 Three Months Ended March 31, 2023 Nucleic Acid Production Biologics Safety Testing Total North America $ 33,415 $ 7,093 $ 40,508 Europe, the Middle East and Africa 4,421 4,571 8,992 Asia Pacific 23,551 5,821 29,372 Latin and Central America 64 89 153 Total revenue $ 61,451 $ 17,574 $ 79,025 Total revenue is attributed to geographic regions based on the bill-to location of the transaction. For all periods presented, the majority of our revenue was recognized at a point in time. Restructuring Costs Restructuring costs relate to a cost realignment plan implemented by the Company in November 2023 to optimize business operations and match them to current market conditions. Restructuring costs are comprised of severance and other employee-related costs, facility and other exit costs, professional fees and other restructuring costs. Employee separation costs principally consist of one-time termination benefits and other post-employment benefits. One-time termination benefits are expensed at the date the entity notifies the employee, unless the employee must provide future service, in which case the benefits are expensed over the future service period. Other post-employment benefits are expensed when the obligation is probable and the benefit amounts are estimable. Other costs associated with restructuring activities, including facility and other exit costs and professional fees, are expensed as they are incurred. Non-Controlling Interests Non-controlling interests represent the portion of profit or loss, net assets and comprehensive income or loss of our consolidated subsidiaries that is not allocable to the Company based on our percentage of ownership of such entities. In November 2020, following the completion of a series of organizational transactions (the “Organizational Transactions”), we became the sole managing member of Topco LLC. As of March 31, 2024, we held approximately 52.7% of the outstanding LLC Units of Topco LLC, and MLSH 1 held approximately 47.3% of the outstanding LLC Units of Topco LLC. Therefore, we report non-controlling interests based on the percentage of LLC Units of Topco LLC held by MLSH 1 on the condensed consolidated balance sheet as of March 31, 2024. Income or loss attributed to the non-controlling interest in Topco LLC is based on the LLC Units outstanding during the period for which the income or loss is generated and is presented on the condensed consolidated statements of operations and condensed consolidated statements of comprehensive income (loss). MLSH 1 is entitled to exchange its LLC Units of Topco LLC, together with an equal number of shares of our Class B common stock (together referred to as “Paired Interests”), for shares of Class A common stock on a one-for-one basis or, at our election, for cash, from a substantially concurrent public offering or private sale (based on the price of our Class A common stock in such public offering or private sale). As such, future exchanges of Paired Interests by MLSH 1 will result in a change in ownership and reduce or increase the amount recorded as non-controlling interests and increase or decrease additional paid-in-capital when Topco LLC has positive or negative net assets, respectively. For the three months ended March 31, 2024 and 2023, MLSH 1 did not exchange any Paired Interests. Distributions of $8.3 million for tax liabilities were made to MLSH 1 during the three months ended March 31, 2023. No such distributions were made during the three months ended March 31, 2024. Segment Information The Company operates in two reportable segments. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the Company’s chief operating decision maker (“CODM”) in deciding how to allocate resources and assessing performance. The CODM allocates resources and assesses performance based upon discrete financial information at the segment level. All of our long-lived assets are located in the United States. Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. The carrying value of these cash equivalents approximates fair value. Cash and cash equivalents consist of deposits held at financial institutions and money market funds. Accounts Receivable and Allowance for Credit Losses Accounts receivable primarily consist of amounts due from customers for product sales and services. The Company’s expected credit losses are developed using an estimated loss rate method that considers historical collection experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The estimated loss rates are applied to trade receivables with similar risk characteristics such as the length of time the balance has been outstanding, liquidity and financial position of the customer, and the geographic location of the customer. In certain instances, the Company may identify individual accounts receivable assets that do not share risk characteristics with other accounts receivable, in which case the Company records its expected credit losses on an individual asset basis. The allowance for credit losses was approximately $1.0 million and $1.4 million as of March 31, 2024 and December 31, 2023, respectively. There were $0.5 million of write-offs of accounts receivable during the three months ended March 31, 2024 and none during the three months ended March 31, 2023. There were no recoveries during the three months ended March 31, 2024 and $0.5 million of recoveries during the three months ended March 31, 2023. Net Income (Loss) per Class A Common Share Attributable to Maravai LifeSciences Holdings, Inc. Basic net income (loss) per Class A common share attributable to Maravai LifeSciences Holdings, Inc. is computed by dividing net income (loss) attributable to us by the weighted average number of Class A common shares outstanding during the period. Diluted net income per Class A common share is calculated by giving effect to all potential weighted average dilutive stock options, restricted stock units, and Topco LLC Units, that, together with an equal number of shares of our Class B common stock, are convertible into shares of our Class A common stock. The dilutive effect of outstanding awards, if any, is reflected in diluted earnings per share by application of the treasury stock method or if-converted method, as applicable. In periods in which the Company reports a net loss attributable to Maravai LifeSciences Holdings, Inc., diluted net loss per Class A common share attributable to the Company is the same as basic net loss per Class A common share attributable to the Company, since dilutive equity instruments are not assumed to have been issued if their effect is anti-dilutive. The Company reported a net loss attributable to Maravai LifeSciences Holdings, Inc. for the three months ended March 31, 2024 and 2023. Government Assistance The consideration awarded to the Company by the U.S. Department of Defense is outside the scope of the contracts with customers, income tax, funded research and development, and contribution guidance. This is because the awarding entity is not considered to be a customer, the receipt of the funding is not predicated on the Company’s income tax position, there are no refund provisions, and the entity is not receiving reciprocal value for their support provided to the Company. The Company’s elected policy is to recognize such assistance as a reduction to the carrying amount of the assets associated with the award when it is reasonably assured that the funding will be received as evidenced through the existence of an arrangement, amounts eligible for reimbursement are determinable and have been incurred or paid, the applicable conditions under the arrangement have been met, and collectability of amounts due is reasonably assured. Fair Value of Financial Instruments The Company defines fair value as the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. The Company follows accounting guidance that has a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of the asset or liability as of the measurement date. Instruments with readily available actively quoted prices, or for which fair value can be measured from actively quoted prices in an orderly market, will generally have a higher degree of market price transparency and a lesser degree of judgment used in measuring fair value. The three levels of the hierarchy are defined as follows: Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets; Level 2—Include other inputs that are directly or indirectly observable in the marketplace; and Level 3—Unobservable inputs which are supported by little or no market activity. As of March 31, 2024 and December 31, 2023, the carrying value of current assets and liabilities approximates fair value due to the short maturities of these instruments. The fair values of the Company’s long-term debt approximate carrying value, excluding the effect of unamortized debt discount, as it is based on borrowing rates currently available to the Company for debt with similar terms and maturities (Level 2 inputs). Contingent Consideration Contingent consideration represents additional consideration that may be transferred to former owners of an acquired entity in the future if certain future events occur or conditions are met. Contingent consideration resulting from the acquisition of a business is recorded at fair value on the acquisition date. Such contingent consideration is re-measured to its estimated fair value at each reporting date with the change in fair value recognized within operating expenses in the Company’s condensed consolidated statements of operations. Subsequent changes in the fair value of the contingent consideration are classified as an adjustment to cash flows from operating activities in the condensed consolidated statements of cash flows because the change in fair value is an input in determining net loss. Cash paid in settlement of contingent consideration liabilities are classified as cash flows from financing activities up to the acquisition date fair value with any excess classified as cash flows from operating activities. Changes in the fair value of contingent consideration liabilities associated with the acquisition of a business can result from updates to assumptions such as the expected timing or probability of achieving customer-related performance targets, specified sales milestones, changes in projected revenue or changes in discount rates. Judgment is used in determining those assumptions as of the acquisition date and for each subsequent reporting period. Therefore, any changes in the fair value will impact the Company’s results of operations in such reporting period, thereby resulting in potential variability in the Company’s operating results until such contingencies are resolved. Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and accounts receivable. The Company maintains the majority of its cash balances at multiple financial institutions that management believes are of high-credit-quality and financially stable. Cash is deposited with major financial institutions in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits. The Company believes it is not exposed to significant credit risk due to the financial strength of the depository institutions in which the cash is held. The Company provides credit, in the normal course of business, to international and domestic distributors as well as certain customers, which are geographically dispersed. The Company attempts to limit its credit risk by performing ongoing credit evaluations of its customers and maintaining adequate allowances for potential credit losses. The following table summarizes revenue from each of our customers who individually accounted for 10% or more of our total revenue or accounts receivable for the periods presented: Revenue Accounts Receivable, net Three Months Ended March 31, March 31, 2024 December 31, 2023 2024 2023 Nacalai USA, Inc. 14.8 % 20.5 % 24.5 % 27.3 % CureVac N.V. * * * 13.0 % ____________________ * Less than 10% For the three months ended March 31, 2024 and 2023, all of the revenue recorded for Nacalai USA, Inc. was generated by the Nucleic Acid Production segment. Recently Issued Accounting Pronouncements Not Yet Adopted In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which improves segment disclosure requirements, primarily through enhanced disclosures about significant expenses. ASU 2023-07 requires disclosures to include significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit or loss, an amount for other segment items by reportable segment and a description of its composition, any additional measures of a segment’s profit or loss used by the CODM when deciding how to allocate resources, and the title and position of the CODM and an explanation of how the CODM uses the reported measures of segment profit or loss in assessing segment performance and deciding how to allocate resources. The ASU also requires all annual disclosures currently required by Topic 280 to be included in interim periods. ASU 2023-07 is effective for the Company for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The amendments in this ASU should be applied retrospectively to all prior periods presented in the consolidated financial statements. The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements and disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures (“ASU 2023-09”). The amendments in this ASU address investor requests for more transparency about income tax information through improvements to tax disclosures primarily related to the rate reconciliation and income taxes paid information. The ASU also includes certain other amendments to improve the effectiveness of income tax disclosures. ASU 2023-09 is effective for the Company for annual periods beginning after December 15, 2024, with early adoption permitted. The amendments in this ASU should be applied on a prospective basis, with retrospective application permitted. The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements and disclosures. |
Restructuring
Restructuring | 3 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring In November 2023, the Company implemented a cost realignment plan (the “Cost Realignment Plan”) that included the termination of approximately 15% of the Company’s workforce, the termination of certain leases, and other actions to reduce expenses, all as part of a plan to optimize business operations and match them to current market conditions. The reduction in force was completed on January 5, 2024, following the end of the sixty-day notification period required by the Worker Adjustment and Retraining Notification Act. The Cost Realignment Plan was substantially completed during the first quarter of 2024 and most of the cash payments had been disbursed prior to March 31, 2024, with the remainder to be disbursed by the end of the fiscal year 2024. The Company does not expect to incur additional restructuring costs relating to the Cost Realignment Plan. For the three months ended March 31, 2024, restructuring charges primarily consist of the stock-based compensation benefit recognized for the forfeiture of stock awards upon the termination of certain impacted employees resulting from the Cost Realignment Plan. The Company’s restructuring charges by segment and unallocated corporate costs, which are recorded as restructuring expenses on the condensed consolidated statements of operations, were as follows for the three months ended March 31, 2024 (in thousands): Severance and Other Employee Costs (Reversals) Stock-Based Compensation Benefit Professional Fee Reversals and Other Total Nucleic Acid Production $ (15) $ (815) $ (20) $ (850) Corporate 68 (416) (14) (362) Total $ 53 $ (1,231) $ (34) $ (1,212) The following table summarizes the activity for accrued restructuring costs, which is recorded within accrued expenses and other current liabilities on the condensed consolidated balance sheets, for the period presented (in thousands): Severance and Other Employee Costs Stock-Based Compensation Expense (Benefit) Professional Fees and Other Total Balance as of December 31, 2023 $ 2,543 $ — $ 271 $ 2,814 Charges (benefit) 53 (1,231) (34) (1,212) Non-cash benefit — 1,231 — 1,231 Cash payments (2,106) — (226) (2,332) Balance as of March 31, 2024 $ 490 $ — $ 11 $ 501 |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following tables summarize the Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy as of the periods presented (in thousands): Fair Value Measurements as of March 31, 2024 Level 1 Level 2 Level 3 Total Assets Money market funds $ 404,202 $ — $ — $ 404,202 Interest rate cap — 8,100 — 8,100 Total assets $ 404,202 $ 8,100 $ — $ 412,302 Liabilities Current portion of contingent consideration $ — $ — $ 131 $ 131 Contingent consideration, non-current — — 1,872 1,872 Total liabilities $ — $ — $ 2,003 $ 2,003 Fair Value Measurements as of December 31, 2023 Level 1 Level 2 Level 3 Total Assets Money market funds $ 418,685 $ — $ — $ 418,685 Interest rate cap — 8,559 — 8,559 Total assets $ 418,685 $ 8,559 $ — $ 427,244 Liabilities Current portion of contingent consideration $ — $ — $ 131 $ 131 Contingent consideration, non-current — — 1,872 1,872 Total liabilities $ — $ — $ 2,003 $ 2,003 Contingent Consideration In connection with the acquisition of Alphazyme, LLC (“Alphazyme”), which was completed in January 2023, the Company is required to make contingent payments to the sellers of Alphazyme of up to $75.0 million, subject to achieving certain revenue thresholds. The preliminary fair value of the liability for the contingent payments recognized upon the acquisition as part of the purchase accounting opening balance sheet totaled $5.3 million. The preliminary fair value of the contingent consideration was determined using a Monte-Carlo simulation-based model discounted to present value. Assumptions used in this calculation are expected revenue, a discount rate of 17.8% and various probability factors. The ultimate settlement of the contingent consideration could deviate from current estimates based on the actual results of these financial measures. The contingent consideration has three performance payments spanning over three years beginning 2024. This liability is considered to be a Level 3 financial liability that is remeasured each reporting period. Changes in fair value of contingent consideration are recognized as a gain or loss and recorded within change in estimated fair value of contingent consideration in the condensed consolidated statements of operations. During the three months ended March 31, 2024 and 2023, the Company did not record any changes in the estimated fair value of contingent consideration. The following table provides a reconciliation of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the period presented (in thousands): Contingent Consideration Balance as of December 31, 2023 $ 2,003 Balance as of March 31, 2024 $ 2,003 |
Balance Sheet Components
Balance Sheet Components | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
Balance Sheet Components | Balance Sheet Components Inventory Inventory consisted of the following as of the periods presented (in thousands): March 31, 2024 December 31, 2023 Raw materials $ 17,070 $ 19,338 Work-in-process 12,525 12,680 Finished goods 20,251 19,379 Total inventory $ 49,846 $ 51,397 Accrued expenses and other current liabilities Accrued expenses consisted of the following as of the periods presented (in thousands): March 31, 2024 December 31, 2023 Employee related $ 9,855 $ 12,905 Accrued interest payable 8,960 9,202 Operating lease liabilities, current portion 6,970 6,780 Professional services 2,879 2,277 Customer deposits 1,974 2,156 Accrued property and equipment 1,602 632 Sales and use tax liability 852 1,001 Accrued restructuring costs 501 2,814 Accrued MyChem Retention Payments, current portion — 19,446 Other 1,812 3,024 Total accrued expenses and other current liabilities $ 35,405 $ 60,237 |
Government Assistance
Government Assistance | 3 Months Ended |
Mar. 31, 2024 | |
Government Assistance [Abstract] | |
Government Assistance | Government Assistance Cooperative Agreement In May 2022, TriLink Biotechnologies, LLC (“TriLink”) entered into a cooperative agreement (the “Cooperative Agreement”) with the U.S. Department of Defense, as represented by the Joint Program Executive Office for Chemical, Biological, Radiological and Nuclear Defense on behalf of the Biomedical Advanced Research and Development Authority (“BARDA”), within the U.S. Department of Health and Human Services (“HHS”), to advance the development of domestic manufacturing capabilities and to expand TriLink’s domestic production capacity in its San Diego manufacturing campus (the “Flanders San Diego Facility”) for products critical to the development and manufacture of mRNA vaccines and therapeutics. The Cooperative Agreement has since transitioned from the U.S. Department of Defense to the HHS as of January 2023. The Flanders San Diego Facility consists of two buildings (“Flanders I” and “Flanders II”), however, the Cooperative Agreement is exclusively involved in Flanders I. The Cooperative Agreement requires the Company to provide the U.S. Government with conditional priority access and certain preferred pricing obligations for a 10-year period from the completion of the construction project for the production of a medical countermeasure (or a component thereof) that the Company manufactures in the Flanders San Diego Facility during a declared public health emergency. Pursuant to certain requirements, BARDA awarded TriLink an amount equal to $38.8 million or 50% of the construction and validation costs currently budgeted for the Flanders San Diego Facility. The contract period of performance is May 2022 through January 2034, which is the effective date of the Cooperative Agreement through the anticipated expiration of the 10-year conditional priority access period. Amounts reimbursed are subject to audit and may be recaptured by the HHS in certain circumstances. During the three months ended March 31, 2024 and 2023, the Company received $1.4 million and $8.0 million, respectively, of reimbursements under the Cooperative Agreement, with equal offsets recorded to property and equipment on the condensed consolidated balance sheets. As of March 31, 2024, the Company has recorded a receivable of $2.8 million, with an equal offset to property and equipment. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Unconditional Purchase Obligations In the ordinary course of business, we enter into certain unconditional purchase obligations with our suppliers. These are agreements to purchase products and services that are enforceable, legally binding, and specify terms that include provisions with respect to quantities, pricing and timing of purchases. Amounts purchased under these obligations totaled $1.9 million for the three months ended March 31, 2024. Such amounts were not material for the three months ended March 31, 2023. As of March 31, 2024, future minimum commitments under these obligations totaled $3.6 million which relates to the nine months ending December 31, 2024. |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Credit Agreement In October 2020, Maravai Intermediate Holdings, LLC (“Intermediate”), a wholly-owned subsidiary of Topco LLC, along with certain of its subsidiaries (together with Intermediate, the “Borrowers”), entered into a credit agreement (as amended, the “Credit Agreement”), which provides for a term loan facility and a revolving credit facility. In January 2022, the Company entered into an amendment (the “Amendment”) to refinance the term loan and to replace London Interbank Offered Rate (“LIBOR”) with a Term Secured Overnight Financing Rate (“SOFR”) based rate. As amended, the Credit Agreement provides for a $600.0 million term loan facility, maturing October 2027 (the “Term Loan”), and a $180.0 million revolving credit facility, maturing October 2025 (the “Revolving Credit Facility”). As of March 31, 2024, the interest rate on the Term Loan was 8.31% per annum. The Credit Agreement also provides for a $20.0 million limit for letters of credit. As of March 31, 2024, the Company had a $0.5 million outstanding letter of credit as security for a lease agreement, which reduced the availability for letters of credit under the Revolving Credit Facility to $19.5 million. Borrowings under the Credit Agreement are unconditionally guaranteed by Topco LLC, together with the existing and future material domestic subsidiaries of Topco LLC (subject to certain exceptions), as specified in the respective guaranty agreements. Borrowings under the Credit Agreement are also secured by a first-priority lien and security interest in substantially all of the assets (subject to certain exceptions) of existing and future material domestic subsidiaries of Topco LLC that are loan parties. As of March 31, 2024, unamortized debt issuance costs totaled $1.2 million and are recorded within other assets on the accompanying condensed consolidated balance sheet as there is no balance outstanding related to the Revolving Credit Facility. Commencing with the fiscal year ended December 31, 2021, and each fiscal year thereafter, the Credit Agreement requires that we make mandatory prepayments on the Term Loan principal upon certain excess cash flow, subject to certain step-downs based on the Company’s first lien net leverage ratio. The excess cash flow shall be reduced to 25% or 0% of the calculated excess cash flow if the Company’s first lien net leverage ratio was equal to or less than 4.75:1.00 or 4.25:1.00, respectively, however, no prepayment shall be required to the extent excess cash flow calculated for the respective period is equal to or less than $10.0 million. As of March 31, 2024, the Company’s first lien net leverage ratio was less than 4.25:1.00. Thus, a mandatory prepayment on the Term Loan out of our excess cash flow was not required. The Credit Agreement contains certain covenants, including, among other things, covenants limiting our ability to incur or prepay certain indebtedness, pay dividends or distributions, dispose of assets, engage in mergers and consolidations, make acquisitions or other investments and make changes to the nature of the business. Additionally, the Credit Agreement also requires us to maintain a certain net leverage ratio if the outstanding debt balance on the Revolving Credit Facility exceeds 35.0% of the aggregate amount of available credit of $180.0 million. The Company was in compliance with these covenants as of March 31, 2024. Interest Rate Cap In the first quarter of 2021, the Company entered into an interest rate cap agreement to manage a portion of its variable interest rate risk on its outstanding long-term debt. The contract, which was effective March 31, 2021, entitles the Company to receive from the counterparty at each calendar quarter end the amount, if any, by which a specified defined floating market rate exceeds the cap strike interest rate, applied to the contract’s notional amount of $415.0 million. The floating rate of interest is reset at the end of each three-month period. The contract was set to expire on March 31, 2023. In May 2022, the Company amended the interest rate cap agreement, effective June 30, 2022, to increase the contract’s notional amount to $500.0 million and to extend the maturity date to January 19, 2025. Additionally, the floating rate option changed from a LIBOR-based rate to a SOFR-based rate. Other provisions remained unchanged as a result of the amendment. Premiums paid to amend the interest rate cap agreement were immaterial. The interest rate cap agreement has not been designated as a hedging relationship and has been recognized on the condensed consolidated balance sheet at fair value of $8.1 million within other assets with changes in fair value recognized within interest expense in the condensed consolidated statements of operations. Proceeds from the interest rate cap agreement are reflected in cash flows used in financing activities in the condensed consolidated statements of cash flows. The Company’s long-term debt consisted of the following as of the periods presented (in thousands): March 31, 2024 December 31, 2023 Term Loan $ 531,760 $ 533,120 Unamortized debt issuance costs (8,427) (8,973) Total long-term debt 523,333 524,147 Less: current portion (5,440) (5,440) Total long-term debt, less current portion $ 517,893 $ 518,707 There were no borrowing balances outstanding on the Company’s Revolving Credit Facility as of March 31, 2024 and December 31, 2023. As of March 31, 2024, the aggregate future principal maturities of the Company’s debt obligations based on contractual due dates, were as follows (in thousands): 2024 (remaining nine months) $ 4,080 2025 5,440 2026 5,440 2027 516,800 Total long-term debt $ 531,760 |
Net Loss Per Class A Common Sha
Net Loss Per Class A Common Share Attributable to Maravai LifeSciences Holdings, Inc. | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Net Loss Per Class A Common Share Attributable to Maravai LifeSciences Holdings, Inc. | Net Loss Per Class A Common Share Attributable to Maravai LifeSciences Holdings, Inc. Basic net loss per Class A common share has been calculated by dividing net loss for the period, adjusted for net loss attributable to non-controlling interests, by the weighted average number of Class A common shares outstanding during the period. In periods in which the Company reports a net loss attributable to Maravai LifeSciences Holdings, Inc., diluted net loss per Class A common share attributable to the Company is the same as basic net loss per Class A common share attributable to the Company, since dilutive equity instruments are not assumed to have been issued if their effect is anti-dilutive. The Company reported a net loss attributable to Maravai LifeSciences Holdings, Inc. during each of the three months ended March 31, 2024 and 2023. The following table presents the computation of basic and diluted net loss per Class A common share attributable to the Company for the periods presented (in thousands, except per share amounts): Three Months Ended 2024 2023 Net loss $ (22,680) $ (1,348) Less: loss attributable to common non-controlling interests 10,602 1,281 Net loss attributable to Maravai LifeSciences Holdings, Inc. $ (12,078) $ (67) Weighted average Class A common shares outstanding 132,333 131,739 Net loss per Class A common share attributable to Maravai LifeSciences Holdings, Inc.: Basic $ (0.09) $ 0.00 Diluted $ (0.09) $ 0.00 Shares of Class B common stock do not share in the earnings or losses of the Company and are therefore not participating securities. As such, a separate presentation of basic and diluted net loss per share for Class B common stock under the two-class method has not been presented. The following table presents potentially dilutive securities excluded from the computation of diluted net loss per share for the periods presented because their effect would have been anti-dilutive for the periods presented (in thousands): Three Months Ended 2024 2023 Restricted stock units 2,343 3,195 Stock options 4,142 4,528 Shares estimated to be purchased under the employee stock purchase plan 7 26 Shares of Class B common stock 119,094 131,789 Total 125,586 139,538 Shares underlying contingently issuable awards that have not met the necessary conditions as of the end of a reporting period are not included in the calculation of diluted net loss per Class A common share attributable to the Company for that period. The Company had contingently issuable performance stock units (“PSUs”) outstanding that did not meet the market and performance conditions as of March 31, 2024 and 2023 and, therefore, were excluded from the calculation of diluted net loss per Class A common share attributable to the Company. The maximum number of potentially dilutive shares that could be issued upon vesting for such awards was insignificant as of March 31, 2024 and 2023. These share amounts were also excluded from the potentially dilutive securities in the table above. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We are subject to U.S. federal and state income taxes with respect to our allocable share of any taxable income or loss of Topco LLC, as well as any stand-alone income or loss we generate. Topco LLC is organized as a limited liability company and treated as a partnership for U.S. federal tax purposes and generally does not pay income taxes on its taxable income in most jurisdictions. Instead, Topco LLC’s taxable income or loss is passed through to its members, including us. The following table summarizes the Company’s income tax expense (benefit) and effective tax rate for the periods presented (in thousands, except percentages): Three Months Ended 2024 2023 Loss before income taxes $ (22,409) $ (4,523) Income tax expense (benefit) $ 271 $ (3,175) Effective tax rate (1.2) % 70.2 % The Company’s effective tax rate of (1.2)% for the three months ended March 31, 2024 differed from the U.S. federal statutory income tax rate of 21.0%, primarily due to the valuation allowance recorded against the Company’s deferred tax assets. The Company’s effective tax rate of 70.2% for the three months ended March 31, 2023 differed from the U.S. federal statutory income tax rate of 21.0%, primarily due to loss income associated with the non-controlling interest and a change in tax (benefit) expense due to adjustments to the deferred tax asset for the Company’s investment in Topco LLC. Tax Distributions to Topco LLC’s Owners Topco LLC is subject to an operating agreement put in place at the date of the Organizational Transactions (“LLC Operating Agreement”). The LLC Operating Agreement has numerous provisions related to allocations of income and loss, as well as timing and amounts of distributions to its owners. This agreement also includes a provision requiring cash distributions enabling its owners to pay their taxes on income passing through from Topco LLC. These tax distributions are computed based on an assumed income tax rate equal to the sum of (i) the maximum combined marginal U.S. federal and state income tax rate applicable to an individual and (ii) the net investment income tax. The assumed income tax rate currently totals 46.7%, which may increase to 54.1% in certain cases where the qualified business income deduction is unavailable. In addition, under the tax rules, Topco LLC is required to allocate taxable income disproportionately to its unit holders. Because tax distributions are determined based on the holder of LLC Units who is allocated the largest amount of taxable income on a per unit basis, but are made pro rata based on ownership, Topco LLC is required to make tax distributions that, in the aggregate, will likely exceed the amount of taxes Topco LLC would have otherwise paid if it were taxed on its taxable income at the assumed income tax rate. Topco LLC is subject to entity level taxation in certain states and certain of its subsidiaries are subject to entity level U.S. and foreign income taxes. As a result, the accompanying condensed consolidated statements of operations include income tax expense related to those states and to U.S. and foreign jurisdictions where Topco LLC or any of our subsidiaries are subject to income tax. During the three months ended March 31, 2024, Topco LLC did not pay any tax distributions to its owners. During the three months ended March 31, 2023, Topco LLC paid tax distributions of $17.4 million to its owners, including $9.1 million to the Company. As of March 31, 2024, no amounts for tax distributions had been accrued as such payments, if any, are made during the period. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions MLSH 1’s majority owner is GTCR, LLC (“GTCR”). The Company’s Executive Chairman of the Board, Chief Financial Officer (“CFO”) and General Counsel are executives of MLSH 1 and MLSH 2. Payable to Related Parties Pursuant to the Tax Receivable Agreement We are a party to a Tax Receivable Agreement (“TRA”) with MLSH 1 and MLSH 2. The TRA provides for the payment by us to MLSH 1 and MLSH 2, collectively, of 85% of the amount of certain tax benefits, if any, that we actually realize, or in some circumstances are deemed to realize, as a result of the Organizational Transactions, our initial public offering (“IPO”) and any subsequent purchases or exchanges of LLC Units of Topco LLC. The Company expects to benefit from the remaining 15% of any cash tax savings that it realizes. We recognize the amount of TRA payments expected to be paid within the next 12 months and classify this amount as current. This determination is based on our estimate of taxable income for the year ended December 31, 2023. As of March 31, 2024, the current liability under the TRA was $7.1 million. As of December 31, 2023, the Company had derecognized the remaining $665.3 million non-current liability under the TRA after concluding it was not probable that the Company will be able to realize the remaining tax benefits based on estimates of future taxable income. The estimation of liability under the TRA is by its nature imprecise and subject to significant assumptions regarding the amount, character, and timing of the taxable income in the future. If the Company concludes in a future period that the tax benefits are more likely than not to be realized and releases its valuation allowance, the corresponding TRA liability amounts may be considered probable at that time and recorded on the consolidated balance sheet and within earnings. As of March 31, 2024 and December 31, 2023, our liability under the TRA was $7.1 million, payable to MLSH 1 and MLSH 2, representing approximately 85% of the calculated tax savings based on our estimate of taxable income for the year ended December 31, 2023. During the three months ended March 31, 2024 and 2023, no payments were made to MLSH 1 or MLSH 2 pursuant to the TRA. Contribution, Exchange and Forfeiture Agreement with MLSH 1 In connection with the Company’s acquisition of Alphazyme, which was completed in January 2023, the Company undertook a series of structuring transactions (the “Structuring Transactions”), including: • On January 18, 2023, the Company acquired all of the outstanding membership interests in Alphazyme. • On January 19, 2023, the Company entered into a contribution agreement (the “Contribution Agreement”) with Alphazyme Holdings, Inc. (“Alphazyme Holdings”), a wholly owned subsidiary of the Company, pursuant to which the Company contributed all such membership interests in Alphazyme (the “Alphazyme Membership Interest”) to Alphazyme Holdings. • On January 22, 2023, Alphazyme Holdings entered into a contribution and exchange agreement (the “Contribution and Exchange Agreement”) with Topco LLC, pursuant to which it contributed all of the Alphazyme Membership Interests to TopCo LLC in exchange for 5,059,134 newly-issued LLC Units of Topco LLC at a price per unit of $13.87, which was equal to the 50-day volume-weighted average price of the Company’s Class A common stock as calculated on January 18, 2023 (the “Contribution and Exchange”). • Immediately following the Contribution and Exchange, the Company entered into a forfeiture agreement (the “Forfeiture Agreement”) with Alphazyme Holdings, TopCo LLC and MLSH 1, a related party, pursuant to which each of the Company (together with Alphazyme Holdings) and MLSH 1 agreed to forfeit 5,059,134 and 4,871,970 LLC Units, respectively, representing 3.7% of the Company’s (together with Alphazyme Holdings) and MLSH 1’s respective LLC Units of Topco LLC, and an equal number of shares of the Company’s Class B common stock, par value $0.01 per share, were forfeited by MLSH 1, in each case for no consideration. Topco LLC Operating Agreement MLSH 1 is party to the LLC Operating Agreement put in place at the date of the Organizational Transactions. This agreement includes a provision requiring cash distributions enabling its owners to pay their taxes on income passing through from Topco LLC. During the three months ended March 31, 2023, the Company made distributions of $8.3 million for tax liabilities to MLSH 1 under this agreement. No such distributions were made during the three months ended March 31, 2024. |
Segments
Segments | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Segments | Segments The Company’s financial performance is reported in two segments. A description of each segment follows: • Nucleic Acid Production : focuses on the manufacturing and sale of highly modified nucleic acids products to support the needs of customers’ research, therapeutic and vaccine programs. This segment also provides research products for labeling and detecting proteins in cells and tissue samples. • Biologics Safety Testing : focuses on the manufacturing and sale of host cell protein, bioprocess impurity detection, viral clearance prediction kits and associated products. This segment also provides services for custom antibody development, assay development, antibody affinity extraction and mass spectrometry that are utilized by our customers in their biologic drug manufacturing spectrum. The Company has determined that adjusted earnings before interest, tax, depreciation and amortization (“Adjusted EBITDA”) is the profit or loss measure that the CODM uses to make resource allocation decisions and evaluate segment performance. Adjusted EBITDA assists management in comparing the segment performance on a consistent basis for purposes of business decision-making by removing the impact of certain items that management believes do not directly reflect the core operations and, therefore, are not included in measuring segment performance. The Company defines Adjusted EBITDA as net loss before interest, taxes, depreciation and amortization, certain non-cash items and other adjustments that we do not consider in our evaluation of ongoing operating performance from period to period. Corporate costs, net of eliminations, are managed on a standalone basis and are not allocated to segments. The following schedule includes revenue and adjusted EBITDA for each of the Company’s reportable operating segments (in thousands): Three Months Ended 2024 2023 Revenue: Nucleic Acid Production $ 46,016 $ 61,451 Biologics Safety Testing 18,163 17,574 Total reportable segments’ revenue $ 64,179 $ 79,025 Segment adjusted EBITDA: Nucleic Acid Production $ 10,088 $ 27,873 Biologics Safety Testing 13,926 13,746 Total reportable segments’ adjusted EBITDA 24,014 41,619 Reconciliation of total reportable segments’ adjusted EBITDA to loss before income taxes Amortization (6,869) (6,765) Depreciation (4,786) (2,080) Interest expense (10,864) (11,833) Interest income 7,210 6,045 Corporate costs, net of eliminations (16,219) (17,821) Other adjustments: Acquisition integration costs (2,498) (2,464) Stock-based compensation (12,057) (5,987) Merger and acquisition related expenses (30) (3,291) Acquisition related tax adjustment 113 173 Tax Receivable Agreement liability adjustment — (1,436) Restructuring costs (1) (19) — Other (404) (683) Loss before income taxes (22,409) (4,523) Income tax (expense) benefit (271) 3,175 Net loss $ (22,680) $ (1,348) ___________________ (1) For the three months ended March 31, 2024, stock-based compensation benefit of $1.2 million related to forfeited stock awards in connection with the restructuring is included on the stock-based compensation line item. There was no intersegment revenue during the three months ended March 31, 2024 and 2023. Any intersegment sales and the related gross margin on inventory recorded at the end of the period are eliminated for consolidation purposes. Internal selling prices for intersegment sales are consistent with the segment’s normal retail price offered to external parties. There was no commission expense recognized for intersegment sales for the three months ended March 31, 2024 and 2023. The Company does not allocate assets to its reportable segments as they are not included in the review performed by the CODM for purposes of assessing segment performance and allocating resources. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) Attributable to Parent | $ (12,078) | $ (67) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 shares | |
Trading Arrangements, by Individual | |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Kurt Oreshack [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On March 1, 2024, Kurt Oreshack, our Executive Vice President, General Counsel and Secretary, adopted a Rule 10b5-1 trading plan that is intended to satisfy the affirmative defense Rule 10b5-1(c) for the sale of up to 25,000 shares of the Company’s Class A common stock prior to the expiration of the plan on February 28, 2025. |
Name | Kurt Oreshack |
Title | Executive Vice President, General Counsel and Secretary |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | March 1, 2024 |
Arrangement Duration | 364 days |
Aggregate Available | 25,000 |
Organization and Significant _2
Organization and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The Company operates and controls all of the business and affairs of Topco LLC, and, through Topco LLC and its subsidiaries, conducts its business. Because we manage and operate the business and control the strategic decisions and day-to-day operations of Topco LLC and also have a substantial financial interest in Topco LLC, we consolidate the financial results of Topco LLC, and a portion of our net loss is allocated to the non-controlling interests in Topco LLC held by MLSH 1. The accompanying unaudited interim condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and accounts between the businesses comprising the Company have been eliminated in the accompanying consolidated financial statements. |
Unaudited Interim Condensed Consolidated Financial Statements and Non-Controlling Interests | Unaudited Interim Condensed Consolidated Financial Statements The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to Form 10-Q of Regulation S-X of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These unaudited condensed consolidated financial statements include all adjustments necessary to fairly state the financial position and the results of our operations and cash flows for interim periods in accordance with GAAP. All such adjustments are of a normal, recurring nature. Operating results for the three months ended March 31, 2024 are not necessarily indicative of the results that may be expected for the full year ending December 31, 2024 or for any future period. The condensed consolidated balance sheet presented as of December 31, 2023 has been derived from the audited consolidated financial statements as of that date. The condensed consolidated financial statements and notes are presented as permitted by Form 10-Q and do not contain all information that is included in the annual financial statements and notes thereto of the Company. The condensed consolidated financial statements and notes included in this report should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 (“2023 Form 10-K”) filed with the SEC. Non-Controlling Interests Non-controlling interests represent the portion of profit or loss, net assets and comprehensive income or loss of our consolidated subsidiaries that is not allocable to the Company based on our percentage of ownership of such entities. In November 2020, following the completion of a series of organizational transactions (the “Organizational Transactions”), we became the sole managing member of Topco LLC. As of March 31, 2024, we held approximately 52.7% of the outstanding LLC Units of Topco LLC, and MLSH 1 held approximately 47.3% of the outstanding LLC Units of Topco LLC. Therefore, we report non-controlling interests based on the percentage of LLC Units of Topco LLC held by MLSH 1 on the condensed consolidated balance sheet as of March 31, 2024. Income or loss attributed to the non-controlling interest in Topco LLC is based on the LLC Units outstanding during the period for which the income or loss is generated and is presented on the condensed consolidated statements of operations and condensed consolidated statements of comprehensive income (loss). |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in accordance with GAAP requires the Company to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, equity, revenue and expenses, and related disclosures. These estimates form the basis for judgments the Company makes about the carrying values of assets and liabilities that are not readily apparent from other sources. The Company bases its estimates and judgments on historical experience and on various other assumptions that the Company believes are reasonable under the circumstances. These estimates are based on management’s knowledge about current events and expectations about actions the Company may undertake in the future. Significant estimates include, but are not limited to, the measurement of right-of-use assets and lease liabilities and related incremental borrowing rate, the payable to related parties pursuant to the Tax Receivable Agreement (as defined in Note 10), the realizability of our net deferred tax assets, and the valuation of goodwill and intangible assets acquired in business combinations. Actual results could differ materially from those estimates. |
Revenue Recognition | Revenue Recognition The Company generates revenue primarily from the sale of products, and to a much lesser extent, services in the fields of nucleic acid production and biologics safety testing. Products are sold primarily through a direct sales force and through distributors in certain international markets where the Company does not have a direct commercial presence. Revenue is recognized when control of promised goods or services is transferred to a customer or distributor in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Distributors are the principal in all sales transactions with our customers. To determine revenue recognition for its arrangements with customers, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The majority of the Company’s contracts include only one performance obligation. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is defined as the unit of account for revenue recognition. The Company also recognizes revenue from other contracts that may include a combination of products and services, the provision of solely services, or from license fee arrangements which may be associated with the delivery of product. Where there is a combination of products and services, the Company accounts for the promises as individual performance obligations if they are concluded to be distinct. Performance obligations are considered distinct if they are both capable of being distinct and distinct within the context of the contract. In determining whether performance obligations meet the criteria for being distinct, the Company considers a number of factors, such as the degree of interrelation and interdependence between obligations, and whether or not the good or service significantly modifies or transforms another good or service in the contract. As a practical expedient, we do not adjust the transaction price for the effects of a significant financing component if, at contract inception, the period between customer payment and the transfer of goods or services is expected to be one year or less. Contracts with customers are evaluated on a contract-by-contract basis as contracts may include multiple types of goods and services as described below. The Company recognizes revenue from sales to customers through distributors consistently with the policies and practices for direct sales to customers, as described above. Nucleic Acid Production Nucleic Acid Production revenue is generated from the manufacture and sale of highly modified, complex nucleic acids products to support the needs of our customers’ research, therapeutic and vaccine programs. The primary offering of products includes CleanCap®, mRNA, specialized oligonucleotides, and enzymes. Contracts typically consist of a single performance obligation. We also sell nucleic acid products for labeling and detecting proteins in cells and tissue samples research. The Company recognizes revenue from these products in the period in which the performance obligation is satisfied by transferring control to the customer or distributor. Revenue for nucleic acid catalog products is recognized at a single point in time, generally upon shipment to the customer or distributor. Revenue for contracts for certain custom nucleic acid products, with an enforceable right to payment and a reasonable margin for work performed to date, is recognized over time, based on a cost-to-cost input method over the manufacturing period. Payments received from customers in advance of manufacturing their products is recorded as deferred revenue until the products are delivered. Biologics Safety Testing The Company’s Biologics Safety Testing revenue is associated with the sale of host cell protein, bioprocess impurity detection, viral clearance prediction kits, and associated products. We also enter into contracts that include custom antibody development, assay development, antibody affinity extraction and mass spectrometry services. These products and services enable the detection of impurities that occur in the manufacturing of biologic drugs and other therapeutics including cell and gene therapies. The Company recognizes revenue from the sale of kits and products in the period in which the performance obligation is satisfied by transferring control to the customer or distributor. Custom antibody development contracts consist of a single performance obligation, typically with an enforceable right to payment and a reasonable margin for work performed to date. Revenue is recognized over time based on a cost-to-cost input method over the contract term. Where an enforceable right to payment does not exist, revenue is recognized at a point in time when control is transferred to the customer. Assay development service contracts consist of a single performance obligation. Revenue is recognized at a point in time when a successful antigen test and report is provided to the customer. Affinity extraction, mass spectrometry and other analytical services, which generally occur over a short period of time, consist of a single performance obligation to perform the service and provide a summary report to the customer. Revenue is recognized upon delivery of the report to the customer. The Company elected the practical expedient to not disclose the unfulfilled performance obligations for contracts with an original length of one year or less. The Company had no material unfulfilled performance obligations for contracts with an original length greater than one year for any period presented. The Company accepts returns only if the products do not meet specifications, and historically, the Company’s volume of product returns has not been significant. Further, no warranties are provided for promised goods and services other than assurance type warranties. Revenue for an individual contract is recognized at the related transaction price, which is the amount the Company expects to be entitled to in exchange for transferring the products and/or services. The transaction price for product sales is calculated at the contracted product selling price. The transaction price for a contract with multiple performance obligations is allocated to the separate performance obligations on a relative standalone selling price basis. Standalone selling prices for products are determined based on the prices charged to customers, which are directly observable. Standalone selling price of services are mostly based on time and materials. Generally, payments from customers are due when goods and services are transferred. As most contracts contain a single performance obligation, the transaction price is representative of the standalone selling price charged to customers. Revenue is recognized only to the extent that it is probable that a significant reversal of the cumulative amount recognized will not occur in future periods. Variable consideration has not been material to our consolidated financial statements. Sales taxes Sales taxes collected by the Company are not included in the transaction price as revenue as they are ultimately remitted to a governmental authority. Shipping and handling costs The Company has elected to account for shipping and handling activities related to contracts with customers as costs to fulfill the promise to transfer the associated products. Accordingly, revenue for shipping and handling is recognized at the same time that the related product revenue is recognized. Contract costs The Company recognizes the incremental costs of obtaining contracts as an expense when incurred when the amortization period of the assets that otherwise would have been recognized is one year or less. These costs are included in sales and marketing and general and administrative expenses. The costs to fulfill the contracts are determined to be immaterial and are recognized as an expense when incurred. Contract balances Contract assets are generated when contractual billing schedules differ from revenue recognition timing and the Company records a contract receivable when it has an unconditional right to consideration. There were no contract asset balances as of March 31, 2024 or December 31, 2023. |
Restructuring Costs | Restructuring Costs Restructuring costs relate to a cost realignment plan implemented by the Company in November 2023 to optimize business operations and match them to current market conditions. Restructuring costs are comprised of severance and other employee-related costs, facility and other exit costs, professional fees and other restructuring costs. Employee separation costs principally consist of one-time termination benefits and other post-employment benefits. One-time termination benefits are expensed at the date the entity notifies the employee, unless the employee must provide future service, in which case the benefits are expensed over the future service period. Other post-employment benefits are expensed when the obligation is probable and the benefit amounts are estimable. Other costs associated with restructuring activities, including facility and other exit costs and professional fees, are expensed as they are incurred. |
Segment Information | Segment Information The Company operates in two reportable segments. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the Company’s chief operating decision maker (“CODM”) in deciding how to allocate resources and assessing performance. The CODM allocates resources and assesses performance based upon discrete financial information at the segment level. All of our long-lived assets are located in the United States. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. The carrying value of these cash equivalents approximates fair value. Cash and cash equivalents consist of deposits held at financial institutions and money market funds. |
Accounts Receivable and Allowance for Credit Losses | Accounts Receivable and Allowance for Credit Losses Accounts receivable primarily consist of amounts due from customers for product sales and services. The Company’s expected credit losses are developed using an estimated loss rate method that considers historical collection experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The estimated loss rates are applied to trade receivables with similar risk characteristics such as the length of time the balance has been outstanding, liquidity and financial position of the customer, and the geographic location of the customer. In certain instances, the Company may identify individual accounts receivable assets that do not share risk characteristics with other accounts receivable, in which case the Company records its expected credit losses on an individual asset basis. |
Net Income (Loss) per Class A Common Share Attributable to Maravai LifeSciences Holdings, Inc. | Net Income (Loss) per Class A Common Share Attributable to Maravai LifeSciences Holdings, Inc. Basic net income (loss) per Class A common share attributable to Maravai LifeSciences Holdings, Inc. is computed by dividing net income (loss) attributable to us by the weighted average number of Class A common shares outstanding during the period. Diluted net income per Class A common share is calculated by giving effect to all potential weighted average dilutive stock options, restricted stock units, and Topco LLC Units, that, together with an equal number of shares of our Class B common stock, are convertible into shares of our Class A common stock. The dilutive effect of outstanding awards, if any, is reflected in diluted earnings per share by application of the treasury stock method or if-converted method, as applicable. In periods in which the Company reports a net loss attributable to Maravai LifeSciences Holdings, Inc., diluted net loss per Class A common share attributable to the Company is the same as basic net loss per Class A common share attributable to the Company, since dilutive equity instruments are not assumed to have been issued if their effect is anti-dilutive. The Company reported a net loss attributable to Maravai LifeSciences Holdings, Inc. for the three months ended March 31, 2024 and 2023. |
Government Assistance | Government Assistance The consideration awarded to the Company by the U.S. Department of Defense is outside the scope of the contracts with customers, income tax, funded research and development, and contribution guidance. This is because the awarding entity is not considered to be a customer, the receipt of the funding is not predicated on the Company’s income tax position, there are no refund provisions, and the entity is not receiving reciprocal value for their support provided to the Company. The Company’s elected policy is to recognize such assistance as a reduction to the carrying amount of the assets associated with the award when it is reasonably assured that the funding will be received as evidenced through the existence of an arrangement, amounts eligible for reimbursement are determinable and have been incurred or paid, the applicable conditions under the arrangement have been met, and collectability of amounts due is reasonably assured. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company defines fair value as the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. The Company follows accounting guidance that has a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of the asset or liability as of the measurement date. Instruments with readily available actively quoted prices, or for which fair value can be measured from actively quoted prices in an orderly market, will generally have a higher degree of market price transparency and a lesser degree of judgment used in measuring fair value. The three levels of the hierarchy are defined as follows: Level 1—Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets; Level 2—Include other inputs that are directly or indirectly observable in the marketplace; and Level 3—Unobservable inputs which are supported by little or no market activity. As of March 31, 2024 and December 31, 2023, the carrying value of current assets and liabilities approximates fair value due to the short maturities of these instruments. The fair values of the Company’s long-term debt approximate carrying value, excluding the effect of unamortized debt discount, as it is based on borrowing rates currently available to the Company for debt with similar terms and maturities (Level 2 inputs). |
Contingent Consideration | Contingent Consideration Contingent consideration represents additional consideration that may be transferred to former owners of an acquired entity in the future if certain future events occur or conditions are met. Contingent consideration resulting from the acquisition of a business is recorded at fair value on the acquisition date. Such contingent consideration is re-measured to its estimated fair value at each reporting date with the change in fair value recognized within operating expenses in the Company’s condensed consolidated statements of operations. Subsequent changes in the fair value of the contingent consideration are classified as an adjustment to cash flows from operating activities in the condensed consolidated statements of cash flows because the change in fair value is an input in determining net loss. Cash paid in settlement of contingent consideration liabilities are classified as cash flows from financing activities up to the acquisition date fair value with any excess classified as cash flows from operating activities. Changes in the fair value of contingent consideration liabilities associated with the acquisition of a business can result from updates to assumptions such as the expected timing or probability of achieving customer-related performance targets, specified sales milestones, changes in projected revenue or changes in discount rates. Judgment is used in determining those assumptions as of the acquisition date and for each subsequent reporting period. Therefore, any changes in the fair value will impact the Company’s results of operations in such reporting period, thereby resulting in potential variability in the Company’s operating results until such contingencies are resolved. |
Concentration of Credit Risk | Concentration of Credit Risk |
Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Issued Accounting Pronouncements Not Yet Adopted In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which improves segment disclosure requirements, primarily through enhanced disclosures about significant expenses. ASU 2023-07 requires disclosures to include significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit or loss, an amount for other segment items by reportable segment and a description of its composition, any additional measures of a segment’s profit or loss used by the CODM when deciding how to allocate resources, and the title and position of the CODM and an explanation of how the CODM uses the reported measures of segment profit or loss in assessing segment performance and deciding how to allocate resources. The ASU also requires all annual disclosures currently required by Topic 280 to be included in interim periods. ASU 2023-07 is effective for the Company for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The amendments in this ASU should be applied retrospectively to all prior periods presented in the consolidated financial statements. The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements and disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) - Improvements to Income Tax Disclosures (“ASU 2023-09”). The amendments in this ASU address investor requests for more transparency about income tax information through improvements to tax disclosures primarily related to the rate reconciliation and income taxes paid information. The ASU also includes certain other amendments to improve the effectiveness of income tax disclosures. ASU 2023-09 is effective for the Company for annual periods beginning after December 15, 2024, with early adoption permitted. The amendments in this ASU should be applied on a prospective basis, with retrospective application permitted. The Company is currently evaluating the impact of adopting this standard on its consolidated financial statements and disclosures. |
Organization and Significant _3
Organization and Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Revenue by Geographic Areas and Segment | The following tables summarize the revenue by segment and region for the periods presented (in thousands): Three Months Ended March 31, 2024 Nucleic Acid Production Biologics Safety Testing Total North America $ 26,278 $ 7,093 $ 33,371 Europe, the Middle East and Africa 4,740 4,625 9,365 Asia Pacific 14,911 6,225 21,136 Latin and Central America 87 220 307 Total revenue $ 46,016 $ 18,163 $ 64,179 Three Months Ended March 31, 2023 Nucleic Acid Production Biologics Safety Testing Total North America $ 33,415 $ 7,093 $ 40,508 Europe, the Middle East and Africa 4,421 4,571 8,992 Asia Pacific 23,551 5,821 29,372 Latin and Central America 64 89 153 Total revenue $ 61,451 $ 17,574 $ 79,025 |
Summary of Concentration of Revenue | The following table summarizes revenue from each of our customers who individually accounted for 10% or more of our total revenue or accounts receivable for the periods presented: Revenue Accounts Receivable, net Three Months Ended March 31, March 31, 2024 December 31, 2023 2024 2023 Nacalai USA, Inc. 14.8 % 20.5 % 24.5 % 27.3 % CureVac N.V. * * * 13.0 % ____________________ * Less than 10% |
Restructuring (Tables)
Restructuring (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | The Company’s restructuring charges by segment and unallocated corporate costs, which are recorded as restructuring expenses on the condensed consolidated statements of operations, were as follows for the three months ended March 31, 2024 (in thousands): Severance and Other Employee Costs (Reversals) Stock-Based Compensation Benefit Professional Fee Reversals and Other Total Nucleic Acid Production $ (15) $ (815) $ (20) $ (850) Corporate 68 (416) (14) (362) Total $ 53 $ (1,231) $ (34) $ (1,212) |
Schedule of Restructuring Reserve by Type of Cost | The following table summarizes the activity for accrued restructuring costs, which is recorded within accrued expenses and other current liabilities on the condensed consolidated balance sheets, for the period presented (in thousands): Severance and Other Employee Costs Stock-Based Compensation Expense (Benefit) Professional Fees and Other Total Balance as of December 31, 2023 $ 2,543 $ — $ 271 $ 2,814 Charges (benefit) 53 (1,231) (34) (1,212) Non-cash benefit — 1,231 — 1,231 Cash payments (2,106) — (226) (2,332) Balance as of March 31, 2024 $ 490 $ — $ 11 $ 501 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Assets Measured on Recurring Basis | The following tables summarize the Company’s financial assets and liabilities that are measured at fair value on a recurring basis by level within the fair value hierarchy as of the periods presented (in thousands): Fair Value Measurements as of March 31, 2024 Level 1 Level 2 Level 3 Total Assets Money market funds $ 404,202 $ — $ — $ 404,202 Interest rate cap — 8,100 — 8,100 Total assets $ 404,202 $ 8,100 $ — $ 412,302 Liabilities Current portion of contingent consideration $ — $ — $ 131 $ 131 Contingent consideration, non-current — — 1,872 1,872 Total liabilities $ — $ — $ 2,003 $ 2,003 Fair Value Measurements as of December 31, 2023 Level 1 Level 2 Level 3 Total Assets Money market funds $ 418,685 $ — $ — $ 418,685 Interest rate cap — 8,559 — 8,559 Total assets $ 418,685 $ 8,559 $ — $ 427,244 Liabilities Current portion of contingent consideration $ — $ — $ 131 $ 131 Contingent consideration, non-current — — 1,872 1,872 Total liabilities $ — $ — $ 2,003 $ 2,003 |
Schedule of Business Acquisitions by Acquisition, Contingent Consideration | The following table provides a reconciliation of liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the period presented (in thousands): Contingent Consideration Balance as of December 31, 2023 $ 2,003 Balance as of March 31, 2024 $ 2,003 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
Summary of Inventory | Inventory consisted of the following as of the periods presented (in thousands): March 31, 2024 December 31, 2023 Raw materials $ 17,070 $ 19,338 Work-in-process 12,525 12,680 Finished goods 20,251 19,379 Total inventory $ 49,846 $ 51,397 |
Summary of Accrued Expenses and Other Current Liabilities | Accrued expenses consisted of the following as of the periods presented (in thousands): March 31, 2024 December 31, 2023 Employee related $ 9,855 $ 12,905 Accrued interest payable 8,960 9,202 Operating lease liabilities, current portion 6,970 6,780 Professional services 2,879 2,277 Customer deposits 1,974 2,156 Accrued property and equipment 1,602 632 Sales and use tax liability 852 1,001 Accrued restructuring costs 501 2,814 Accrued MyChem Retention Payments, current portion — 19,446 Other 1,812 3,024 Total accrued expenses and other current liabilities $ 35,405 $ 60,237 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Summary of Long-Term Debt | The Company’s long-term debt consisted of the following as of the periods presented (in thousands): March 31, 2024 December 31, 2023 Term Loan $ 531,760 $ 533,120 Unamortized debt issuance costs (8,427) (8,973) Total long-term debt 523,333 524,147 Less: current portion (5,440) (5,440) Total long-term debt, less current portion $ 517,893 $ 518,707 |
Schedule of Maturities of Long-Term Debt | As of March 31, 2024, the aggregate future principal maturities of the Company’s debt obligations based on contractual due dates, were as follows (in thousands): 2024 (remaining nine months) $ 4,080 2025 5,440 2026 5,440 2027 516,800 Total long-term debt $ 531,760 |
Net Loss Per Class A Common S_2
Net Loss Per Class A Common Share Attributable to Maravai LifeSciences Holdings, Inc. (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Loss Per Share | The following table presents the computation of basic and diluted net loss per Class A common share attributable to the Company for the periods presented (in thousands, except per share amounts): Three Months Ended 2024 2023 Net loss $ (22,680) $ (1,348) Less: loss attributable to common non-controlling interests 10,602 1,281 Net loss attributable to Maravai LifeSciences Holdings, Inc. $ (12,078) $ (67) Weighted average Class A common shares outstanding 132,333 131,739 Net loss per Class A common share attributable to Maravai LifeSciences Holdings, Inc.: Basic $ (0.09) $ 0.00 Diluted $ (0.09) $ 0.00 |
Summary of Dilutive Securities Excluded from Computation of Loss Per Share | The following table presents potentially dilutive securities excluded from the computation of diluted net loss per share for the periods presented because their effect would have been anti-dilutive for the periods presented (in thousands): Three Months Ended 2024 2023 Restricted stock units 2,343 3,195 Stock options 4,142 4,528 Shares estimated to be purchased under the employee stock purchase plan 7 26 Shares of Class B common stock 119,094 131,789 Total 125,586 139,538 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The following table summarizes the Company’s income tax expense (benefit) and effective tax rate for the periods presented (in thousands, except percentages): Three Months Ended 2024 2023 Loss before income taxes $ (22,409) $ (4,523) Income tax expense (benefit) $ 271 $ (3,175) Effective tax rate (1.2) % 70.2 % |
Segments (Tables)
Segments (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Summary of Segment Reporting Information | The following schedule includes revenue and adjusted EBITDA for each of the Company’s reportable operating segments (in thousands): Three Months Ended 2024 2023 Revenue: Nucleic Acid Production $ 46,016 $ 61,451 Biologics Safety Testing 18,163 17,574 Total reportable segments’ revenue $ 64,179 $ 79,025 Segment adjusted EBITDA: Nucleic Acid Production $ 10,088 $ 27,873 Biologics Safety Testing 13,926 13,746 Total reportable segments’ adjusted EBITDA 24,014 41,619 Reconciliation of total reportable segments’ adjusted EBITDA to loss before income taxes Amortization (6,869) (6,765) Depreciation (4,786) (2,080) Interest expense (10,864) (11,833) Interest income 7,210 6,045 Corporate costs, net of eliminations (16,219) (17,821) Other adjustments: Acquisition integration costs (2,498) (2,464) Stock-based compensation (12,057) (5,987) Merger and acquisition related expenses (30) (3,291) Acquisition related tax adjustment 113 173 Tax Receivable Agreement liability adjustment — (1,436) Restructuring costs (1) (19) — Other (404) (683) Loss before income taxes (22,409) (4,523) Income tax (expense) benefit (271) 3,175 Net loss $ (22,680) $ (1,348) ___________________ (1) For the three months ended March 31, 2024, stock-based compensation benefit of $1.2 million related to forfeited stock awards in connection with the restructuring is included on the stock-based compensation line item. |
Reconciliation of Revenue | The following schedule includes revenue and adjusted EBITDA for each of the Company’s reportable operating segments (in thousands): Three Months Ended 2024 2023 Revenue: Nucleic Acid Production $ 46,016 $ 61,451 Biologics Safety Testing 18,163 17,574 Total reportable segments’ revenue $ 64,179 $ 79,025 Segment adjusted EBITDA: Nucleic Acid Production $ 10,088 $ 27,873 Biologics Safety Testing 13,926 13,746 Total reportable segments’ adjusted EBITDA 24,014 41,619 Reconciliation of total reportable segments’ adjusted EBITDA to loss before income taxes Amortization (6,869) (6,765) Depreciation (4,786) (2,080) Interest expense (10,864) (11,833) Interest income 7,210 6,045 Corporate costs, net of eliminations (16,219) (17,821) Other adjustments: Acquisition integration costs (2,498) (2,464) Stock-based compensation (12,057) (5,987) Merger and acquisition related expenses (30) (3,291) Acquisition related tax adjustment 113 173 Tax Receivable Agreement liability adjustment — (1,436) Restructuring costs (1) (19) — Other (404) (683) Loss before income taxes (22,409) (4,523) Income tax (expense) benefit (271) 3,175 Net loss $ (22,680) $ (1,348) ___________________ (1) For the three months ended March 31, 2024, stock-based compensation benefit of $1.2 million related to forfeited stock awards in connection with the restructuring is included on the stock-based compensation line item. |
Organization and Significant _4
Organization and Significant Accounting Policies - Description of Business (Details) | 3 Months Ended |
Mar. 31, 2024 segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of operating segments | 2 |
Organization and Significant _5
Organization and Significant Accounting Policies - Revenue Recognition (Details) - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Contract assets | $ 0 | $ 0 |
Contract liabilities | $ 4,200,000 | $ 5,500,000 |
Organization and Significant _6
Organization and Significant Accounting Policies - Geographical Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 64,179 | $ 79,025 |
North America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 33,371 | 40,508 |
Europe, the Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 9,365 | 8,992 |
Asia Pacific | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 21,136 | 29,372 |
Latin and Central America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 307 | 153 |
Nucleic Acid Production | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 46,016 | 61,451 |
Nucleic Acid Production | North America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 26,278 | 33,415 |
Nucleic Acid Production | Europe, the Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 4,740 | 4,421 |
Nucleic Acid Production | Asia Pacific | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 14,911 | 23,551 |
Nucleic Acid Production | Latin and Central America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 87 | 64 |
Biologics Safety Testing | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 18,163 | 17,574 |
Biologics Safety Testing | North America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 7,093 | 7,093 |
Biologics Safety Testing | Europe, the Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 4,625 | 4,571 |
Biologics Safety Testing | Asia Pacific | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 6,225 | 5,821 |
Biologics Safety Testing | Latin and Central America | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 220 | $ 89 |
Organization and Significant _7
Organization and Significant Accounting Policies - Non-Controlling Interests (Details) | 3 Months Ended | |
Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | |
Noncontrolling Interest [Line Items] | ||
Stock conversion ratio | 1 | |
Topco LLC | Tax Distribution | ||
Noncontrolling Interest [Line Items] | ||
Tax distributions paid | $ 0 | $ 17,400,000 |
Topco LLC | Tax Distribution | MLSH 1 | ||
Noncontrolling Interest [Line Items] | ||
Tax distributions paid | $ 0 | $ 8,300,000 |
Topco LLC | ||
Noncontrolling Interest [Line Items] | ||
Ownership percent by parent | 52.70% | |
Topco LLC | MLSH 1 | ||
Noncontrolling Interest [Line Items] | ||
Ownership percent by noncontrolling interest | 47.30% |
Organization and Significant _8
Organization and Significant Accounting Policies - Segment Information (Details) | 3 Months Ended |
Mar. 31, 2024 segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reportable segments | 2 |
Organization and Significant _9
Organization and Significant Accounting Policies - Accounts Receivable and Allowance for Credit Losses (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Allowance for credit loss | $ 1,000,000 | $ 1,400,000 | |
Write-offs | 500,000 | $ 0 | |
Recovery | $ 0 | $ 500,000 |
Organization and Significant_10
Organization and Significant Accounting Policies - Concentration Risk (Details) - Customer Concentration Risk | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Revenue | Nacalai USA, Inc. | |||
Product Information [Line Items] | |||
Concentration risk | 14.80% | 20.50% | |
Accounts Receivable, net | Nacalai USA, Inc. | |||
Product Information [Line Items] | |||
Concentration risk | 24.50% | 27.30% | |
Accounts Receivable, net | CureVac N.V. | |||
Product Information [Line Items] | |||
Concentration risk | 13% |
Restructuring - Narrative (Deta
Restructuring - Narrative (Details) | 1 Months Ended |
Nov. 30, 2023 | |
Cost Realignment Plan | |
Restructuring Cost and Reserve [Line Items] | |
Number of positions eliminated, period percent | 15% |
Restructuring - Restructuring C
Restructuring - Restructuring Charges By Segment And Unallocated Corporate (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||
Stock-Based Compensation Benefit | $ 12,057 | $ 5,987 |
Total | (1,212) | $ 0 |
Cost Realignment Plan | ||
Restructuring Cost and Reserve [Line Items] | ||
Severance and Other Employee Costs (Reversals) | 53 | |
Stock-Based Compensation Benefit | (1,231) | |
Professional Fee Reversals and Other | (34) | |
Total | (1,212) | |
Nucleic Acid Production | Cost Realignment Plan | ||
Restructuring Cost and Reserve [Line Items] | ||
Severance and Other Employee Costs (Reversals) | (15) | |
Stock-Based Compensation Benefit | (815) | |
Professional Fee Reversals and Other | (20) | |
Total | (850) | |
Corporate | Cost Realignment Plan | ||
Restructuring Cost and Reserve [Line Items] | ||
Severance and Other Employee Costs (Reversals) | 68 | |
Stock-Based Compensation Benefit | (416) | |
Professional Fee Reversals and Other | (14) | |
Total | $ (362) |
Restructuring - Schedule of Acc
Restructuring - Schedule of Accrued Restructuring Costs Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Restructuring Reserve [Roll Forward] | ||
Charges (benefit) | $ (1,212) | $ 0 |
Cost Realignment Plan | ||
Restructuring Reserve [Roll Forward] | ||
Balance as of December 31, 2023 | 2,814 | |
Charges (benefit) | (1,212) | |
Non-cash benefit | 1,231 | |
Cash payments | (2,332) | |
Balance as of March 31, 2024 | 501 | |
Severance and Other Employee Costs | Cost Realignment Plan | ||
Restructuring Reserve [Roll Forward] | ||
Balance as of December 31, 2023 | 2,543 | |
Charges (benefit) | 53 | |
Non-cash benefit | 0 | |
Cash payments | (2,106) | |
Balance as of March 31, 2024 | 490 | |
Stock-Based Compensation Expense (Benefit) | Cost Realignment Plan | ||
Restructuring Reserve [Roll Forward] | ||
Balance as of December 31, 2023 | 0 | |
Charges (benefit) | (1,231) | |
Non-cash benefit | 1,231 | |
Cash payments | 0 | |
Balance as of March 31, 2024 | 0 | |
Professional Fees and Other | Cost Realignment Plan | ||
Restructuring Reserve [Roll Forward] | ||
Balance as of December 31, 2023 | 271 | |
Charges (benefit) | (34) | |
Non-cash benefit | 0 | |
Cash payments | (226) | |
Balance as of March 31, 2024 | $ 11 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Recurring Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Liabilities | ||
Total liabilities | $ 2,003 | $ 2,003 |
Fair Value, Recurring | ||
Assets | ||
Derivative Asset | 412,302 | 427,244 |
Liabilities | ||
Current portion of contingent consideration | 131 | 131 |
Contingent consideration, non-current | 1,872 | 1,872 |
Total liabilities | 2,003 | 2,003 |
Fair Value, Recurring | Money market funds | ||
Assets | ||
Derivative Asset | 404,202 | 418,685 |
Fair Value, Recurring | Interest rate cap | ||
Assets | ||
Derivative Asset | 8,100 | 8,559 |
Fair Value, Recurring | Level 1 | ||
Assets | ||
Derivative Asset | 404,202 | 418,685 |
Liabilities | ||
Current portion of contingent consideration | 0 | 0 |
Contingent consideration, non-current | 0 | 0 |
Total liabilities | 0 | 0 |
Fair Value, Recurring | Level 1 | Money market funds | ||
Assets | ||
Derivative Asset | 404,202 | 418,685 |
Fair Value, Recurring | Level 1 | Interest rate cap | ||
Assets | ||
Derivative Asset | 0 | 0 |
Fair Value, Recurring | Level 2 | ||
Assets | ||
Derivative Asset | 8,100 | 8,559 |
Liabilities | ||
Current portion of contingent consideration | 0 | 0 |
Contingent consideration, non-current | 0 | 0 |
Total liabilities | 0 | 0 |
Fair Value, Recurring | Level 2 | Money market funds | ||
Assets | ||
Derivative Asset | 0 | 0 |
Fair Value, Recurring | Level 2 | Interest rate cap | ||
Assets | ||
Derivative Asset | 8,100 | 8,559 |
Fair Value, Recurring | Level 3 | ||
Assets | ||
Derivative Asset | 0 | 0 |
Liabilities | ||
Current portion of contingent consideration | 131 | 131 |
Contingent consideration, non-current | 1,872 | 1,872 |
Total liabilities | 2,003 | 2,003 |
Fair Value, Recurring | Level 3 | Money market funds | ||
Assets | ||
Derivative Asset | 0 | 0 |
Fair Value, Recurring | Level 3 | Interest rate cap | ||
Assets | ||
Derivative Asset | $ 0 | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) | 1 Months Ended | 3 Months Ended | ||
Jan. 31, 2023 USD ($) payment | Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent consideration | $ 2,003,000 | $ 2,003,000 | ||
Alphazyme | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value of contingent consideration | $ 5,300,000 | |||
Number of payments | payment | 3 | |||
Payment period | 3 years | |||
Change in estimated fair value of contingent consideration | $ 0 | $ 0 | ||
Alphazyme | Discount Rate | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent consideration liability, measurement input | 0.178 | |||
Alphazyme | SPA, Maximum Performance Payment | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent consideration | $ 75,000,000 |
Fair Value Measurements - Sum_2
Fair Value Measurements - Summary of Contingent Consideration (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Fair Value Disclosures [Abstract] | ||
Contingent Consideration | $ 2,003 | $ 2,003 |
Balance Sheet Components - Inve
Balance Sheet Components - Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 17,070 | $ 19,338 |
Work-in-process | 12,525 | 12,680 |
Finished goods | 20,251 | 19,379 |
Total inventory | $ 49,846 | $ 51,397 |
Balance Sheet Components - Summ
Balance Sheet Components - Summary of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Business Acquisition [Line Items] | ||
Employee related | $ 9,855 | $ 12,905 |
Accrued interest payable | 8,960 | 9,202 |
Operating lease liabilities, current portion | 6,970 | 6,780 |
Professional services | 2,879 | 2,277 |
Customer deposits | 1,974 | 2,156 |
Accrued property and equipment | 1,602 | 632 |
Sales and use tax liability | 852 | 1,001 |
Accrued restructuring costs | 501 | 2,814 |
Other | 1,812 | 3,024 |
Total accrued expenses and other current liabilities | 35,405 | 60,237 |
MyChem | ||
Business Acquisition [Line Items] | ||
Accrued MyChem Retention Payments, current portion | $ 0 | $ 19,446 |
Government Assistance (Details)
Government Assistance (Details) $ in Millions | 1 Months Ended | 3 Months Ended | |
May 31, 2022 USD ($) building | Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | |
Cooperative Agreement | |||
Gain Contingencies [Line Items] | |||
Priority access period | 10 years | ||
Expectation of reimbursement amount from government | $ 38.8 | ||
Percentage of reimbursable costs | 50% | ||
Government assistance received | $ 1.4 | $ 8 | |
Government contract receivable | $ 2.8 | ||
San Diego Facility Lease | |||
Gain Contingencies [Line Items] | |||
Number of buildings | building | 2 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Amounts purchased under these obligations | $ 1.9 | $ 0 |
Future minimum commitments | $ 3.6 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 | May 31, 2022 | Jan. 31, 2022 | Mar. 31, 2021 | Oct. 31, 2020 |
Debt Instrument [Line Items] | ||||||
Debt issuance costs | $ 1,200,000 | |||||
Interest rate cap | ||||||
Debt Instrument [Line Items] | ||||||
Derivative, notional amount | $ 500,000,000 | $ 415,000,000 | ||||
Interest rate cap | $ 8,100,000 | |||||
New Credit Agreement | Line of Credit | Term Loan | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit facility, maximum borrowing capacity | $ 600,000,000 | |||||
Debt interest rate | 8.31% | |||||
Leverage ratio covenant | 4.25 | |||||
Excess cash threshold amount | $ 10,000,000 | |||||
New Credit Agreement | Line of Credit | Term Loan | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Excess cash ratio percentage | 25% | |||||
Leverage ratio covenant | 4.75 | |||||
New Credit Agreement | Line of Credit | Term Loan | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Excess cash ratio percentage | 0% | |||||
New Credit Agreement | Line of Credit | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit facility, maximum borrowing capacity | $ 180,000,000 | |||||
Outstanding line of credit | $ 0 | $ 0 | ||||
Leverage ratio outstanding balance threshold, percentage | 35% | |||||
New Credit Agreement | Line of Credit | Letter of Credit | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit facility, maximum borrowing capacity | $ 20,000,000 | |||||
Letters of credit outstanding | $ 500,000 | |||||
Remaining borrowing capacity | $ 19,500,000 |
Long-Term Debt - Summary of Lon
Long-Term Debt - Summary of Long-Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 531,760 | |
Unamortized debt issuance costs | (8,427) | $ (8,973) |
Total long-term debt | 523,333 | 524,147 |
Less: current portion | (5,440) | (5,440) |
Total long-term debt, less current portion | 517,893 | 518,707 |
Term Loan | New Credit Agreement | Line of Credit | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 531,760 | $ 533,120 |
Long-Term Debt - Maturities of
Long-Term Debt - Maturities of Long-Term Debt (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Debt Disclosure [Abstract] | |
2024 (remaining nine months) | $ 4,080 |
2025 | 5,440 |
2026 | 5,440 |
2027 | 516,800 |
Total long-term debt | $ 531,760 |
Net Loss Per Class A Common S_3
Net Loss Per Class A Common Share Attributable to Maravai LifeSciences Holdings, Inc. - Summary of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Earnings Per Share [Abstract] | ||
Net loss | $ (22,680) | $ (1,348) |
Less: loss attributable to common non-controlling interests | 10,602 | 1,281 |
Net loss attributable to Maravai LifeSciences Holdings, Inc., basic | (12,078) | (67) |
Net loss attributable to Maravai LifeSciences Holdings, Inc., diluted | $ (12,078) | $ (67) |
Weighted average Class A common shares outstanding - basic (in shares) | 132,333 | 131,739 |
Weighted average Class A common shares outstanding - diluted (in shares) | 132,333 | 131,739 |
Net loss per Class A common share—basic (in usd per share) | $ (0.09) | $ 0 |
Net loss per Class A common share - diluted (in usd per share) | $ (0.09) | $ 0 |
Net Loss Per Class A Common S_4
Net Loss Per Class A Common Share Attributable to Maravai LifeSciences Holdings, Inc. - Summary of Dilutive Securities Excluded (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from computation of net income per share (in shares) | 125,586 | 139,538 |
Restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from computation of net income per share (in shares) | 2,343 | 3,195 |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from computation of net income per share (in shares) | 4,142 | 4,528 |
Shares estimated to be purchased under the employee stock purchase plan | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from computation of net income per share (in shares) | 7 | 26 |
Shares of Class B common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from computation of net income per share (in shares) | 119,094 | 131,789 |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income Tax Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | ||
Loss before income taxes | $ (22,409) | $ (4,523) |
Income tax expense (benefit) | $ 271 | $ (3,175) |
Effective tax rate | (1.20%) | 70.20% |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Tax Examination [Line Items] | ||
Effective tax rate | (1.20%) | 70.20% |
Assumed income tax rate | 46.70% | |
Assumed income tax rate when business income deduction is unavailable | 54.10% | |
Tax distribution payable | $ 0 | |
Topco LLC | Tax Distribution | ||
Income Tax Examination [Line Items] | ||
Tax distributions paid | $ 0 | $ 17,400,000 |
Topco LLC | Tax Distribution | Maravai LifeSciences Holdings, Inc | ||
Income Tax Examination [Line Items] | ||
Tax distributions paid | $ 9,100,000 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Jan. 22, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Related Party Transaction [Line Items] | ||||
Percentage of tax benefits paid | 85% | 85% | ||
Tax receivable agreement, remaining percentage | 15% | |||
Period used for weighted average price | 50 days | |||
Common unit forfeiture percentage | 3.70% | |||
Distribution | $ 8,302,000 | |||
Non-Controlling Interest | ||||
Related Party Transaction [Line Items] | ||||
Distribution | $ 0 | 8,302,000 | ||
Class B Common Stock | ||||
Related Party Transaction [Line Items] | ||||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 | $ 0.01 | |
Alphazyme Holdings, Inc | ||||
Related Party Transaction [Line Items] | ||||
Common units acquired (in shares) | 5,059,134 | |||
Newly issued shares repurchased (in usd per share) | $ 13.87 | |||
Maravai LifeSciences Holdings, Inc. and Alphazyme Holdings, Inc. | ||||
Related Party Transaction [Line Items] | ||||
Common units forfeited (in shares) | 5,059,134 | |||
MLSH 1 | ||||
Related Party Transaction [Line Items] | ||||
Common units forfeited (in shares) | 4,871,970 | |||
Related Party | ||||
Related Party Transaction [Line Items] | ||||
Accounts payable | $ 7,069,000 | $ 7,069,000 | ||
Related Party | Tax Receivable Agreement, Payments | MLSH1 and MLSH 2 | ||||
Related Party Transaction [Line Items] | ||||
Accounts payable | 7,100,000 | |||
Related party transaction amounts | 0 | $ 0 | ||
Liability payable | $ 7,100,000 | 7,100,000 | ||
Related Party | Tax Receivable Agreement, Non-Current Liability Derecognized | ||||
Related Party Transaction [Line Items] | ||||
Related party transaction amounts | $ 665,300,000 |
Segments - Narrative (Details)
Segments - Narrative (Details) | 3 Months Ended | |
Mar. 31, 2024 USD ($) segment | Mar. 31, 2023 USD ($) | |
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Number of reportable segments | segment | 2 | |
Revenue | $ 64,179,000 | $ 79,025,000 |
Intersegment eliminations | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Revenue | 0 | 0 |
Commission expense | $ 0 | $ 0 |
Segments - Reconciliation of Re
Segments - Reconciliation of Revenue and Adjusted EBITDA to Net Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Revenue | $ 64,179 | $ 79,025 |
Amortization | (6,869) | (6,765) |
Depreciation | (4,786) | (2,080) |
Interest expense | (10,864) | (11,833) |
Interest income | 7,210 | 6,045 |
Corporate costs, net of eliminations | (16,219) | (17,821) |
Other adjustments: | ||
Acquisition integration costs | (2,498) | (2,464) |
Stock-based compensation | (12,057) | (5,987) |
Merger and acquisition related expenses | (30) | (3,291) |
Acquisition related tax adjustment | 113 | 173 |
Tax Receivable Agreement liability adjustment | 0 | (1,436) |
Restructuring costs | (19) | 0 |
Other | (404) | (683) |
Loss before income taxes | (22,409) | (4,523) |
Income tax (expense) benefit | (271) | 3,175 |
Net loss | (22,680) | (1,348) |
Restructuring related compensation benefit included in equity based compensation | 1,200 | |
Nucleic Acid Production | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Revenue | 46,016 | 61,451 |
Biologics Safety Testing | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Revenue | 18,163 | 17,574 |
Operating Segments | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Revenue | 64,179 | 79,025 |
Segment adjusted EBITDA | 24,014 | 41,619 |
Operating Segments | Nucleic Acid Production | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Revenue | 46,016 | 61,451 |
Segment adjusted EBITDA | 10,088 | 27,873 |
Operating Segments | Biologics Safety Testing | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||
Revenue | 18,163 | 17,574 |
Segment adjusted EBITDA | $ 13,926 | $ 13,746 |