PRPO - Earnings call transcript Q2 2018

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Operator

Good morning, and welcome to Precipio's Quarterly Shareholder Update Conference Call. [Operator Instructions] I would now like to turn the conference over to [Mary Radomski], Precipio's in-house Counsel. Please go ahead.

Company Representative

Thank you. Good morning, all. call statements this our during made contain about forward-looking business. Statements

events date statements statements whether not indicated, as result they forward-looking to otherwise, or new date forward-looking Report ended filings as on reports Risks assumptions including and or the to further on not XX-K the from or as in at for estimate; Securities our our meaning. continue available Form the or factors statement as and except Commission, the our be risks of terms to as identified actual subsequent but by our detailed place information any may; to law. provided statements for should June or other these speak those is including Commission. include publicly Exchange belief; and listed such not should; are and which uncertainties. the XX-Q early in on are only forward-looking risks current materially are obligations and unless and www.sec.com significant that words other undue XXXX, well an risks forecast uncertainties information by Quarterly upon You year results anticipate; Annual may negative based in undertake the terms file forth could; forecast; reliance per forward-looking and differ Report cause statements Statements statement XX, Exchange under Form expect; matters predict; These our are and plan; do XXXX, limited the with could similar subject potential; are these is to we update Securities expectation required information, XX, as any These words with set and will; on statements intent; December of

call Precipio's to Now, over CEO. let Ilan, me the hand

Ilan Danieli

of our that the and many in work call, than Company's associated business. growth our to support plan attention, in ever Good and continue everyone Biopsy Thank appreciate our product other submitted answer and We'll disease do since merger, am untold second our goal our for thank mission call this throughout the you, the morning. in execution initiatives successful Mary. advance. particular, suffering joining after questions our more value the to dedication misdiagnosis. to shareholders today. the and wasted I'd with and Pathology months the relieve XX Liquid in the questions I in the I of team's best to resources quarter and both like interest, development building hard confident demonstrate Services Accelerating and in on those

Carl, our details as of well update, quarter. my Following an the will as Company's on financial update provide share the CFO, strategy,

e-mail the our and of at by customary our on we've reciting your this than previously, narrative as investors@precipiodx.com. XX-Q, As time We rather where the like recently and welcome feedback done format extend in to the you find going. we we'd hope business give use perspective where to is you this more always, filed informative, numbers to

our then So [indiscernible] The business from me our a on Carl followed offering. let continue progress of Biopsy update, with business our provide remarks me. few our that, and to financial closing update Services by provide a develop and Liquid will Pathology

the our of we're to reps our four more this eight doubled we've side, Services adding Pathology sales year, and since to from the quarter four team On the team. start talented

Xx of first has six reach breakeven that her a months within by the of end rep year the ROI. Our experience sales provide the involvement, to or his and can the shown Xx

our altering cycle year-over-year. our quality fact between reps year cases An academic the close followed of to U.S. our industry with important all the a factor our lag a around volume physician XX few due market. the Our uniquely providing goal increase in to sales is appeal that Pathology business of coverage the conversion to by talent with and end is to one-third sophisticated of with of is gradual streamlined to from wins case our XXX% our expansion Services, customer the We XX% customers diagnosis. pathology level combination about corresponding to The access bearing clients the the hear competition. providing increase increase to regularly begins fruit that meaningful, physician laboratory in volume lab. base This using increase proposition, impact expertise, is trial competitive and a life from value sales academic with a advantage clinical a a differentiated

cancer impact. is to ICP technology, of test service a onboard Biopsy new We will The will of our have the patients driver along key by the U.S. PCR, addressed by number the large way. and by important patients of Liquid continue that market be offering to decision discovery the the test One adoption hospitals. driven breadth is of the introduction ICE-COLD i.e. of expansion made discoveries our

that current double and portion of at also can seen Our a planned this exploring address we're the our We've lab volume do to to regional address other testifies current this colon and to - among large that ICP end lung, of challenge see reference not test expect Furthermore, the and stronger challenge positive we various the for already patients, making test XXXX, quarter. level which other to offering introduction alternatives technology on the stage. creates menu an certain feedback, through menu melanoma, hospitals at technology. of include More by once upcoming cancer the more the treatment sized patients a adoption of Based the pancreatic initiative onboard attractive in Meanwhile, to ICP the to only but hospital. products market expedited of hospitals, larger segments on to have the expanded. come of is market economically. integration the national

in Overseas, decisions are our sales ICP offering reimbursement, many completion. U.S. the result, that of as studies on a Our out-of-pocket to pipeline due medical expanding based competitive payment than process numerous in is markets, pilot is considerations in often rather especially the fact as with the

significant see to in Our grow interest ICP. we pipeline as continues

large, U.S. complex, tests, are many tests effective, a NGS by actually panels, very solutions patients. cost growth U.S., most efficient these Particularly out. companies to the largely ICP unaffordable as patients like that While are rolled we are offers and reimburse offering significant expensive to India, and expect for in insurance still even and competitors these in countries products China and are reluctant

the research we a in significant certain than cost our mutations. weeks ability initiatives less for for advantage CRO we genetic material unmatched producing segments opportunities Finally, believe by develop this under research and deliver segment, competitive we competition. test to maintain in is our [ph], advance a into speed test specific seeking market pharma of customized customized is [$XX,XXX] where XX In

Some significant market of tests revenue diagnostics therapies these become potential. could creating ultimately reach companion of growth the that

into continue We quarter as and customer year, into strategic that build to next base during enter the industry's expect several largest both partnerships well of generating players, next revenue domestically to internationally. our as some the with and

a XXXX reveal IV Addressing cycle cell expect expands to expect international, of this revenue we commercial media number we XX% and our strategic matures. commercialization other as to value cell research product. and XX% product domestic on options potentially of out mix from market culture the high new and offering still continues approximately While comprised sales that U.S. initiatives, and discussions be proprietary our even in ICP we're to

in a continue it who of users we in media with While parties also towards the as work using conduct they to enquiries interested are we've interested received due-diligence clinical acquisition, potential their laboratory. from potential

do that the Although value of Precipio media user becoming we of monetization. base establishing increase will think pave this and an the for significantly, better likely active we don't way anticipate a of media, IP this manufacture the

innovation their partner could excited to XX for potential start working to XXXX. solution to most a pathology the testing U.S. six and month. We're begin care. among patients potential hematopathology pathology artificial testing disruptive and beneficiaries to market ready in about to in towards Nucleai with to of a expect greatest soon widest full with field. out the especially of adapt are Healthcare the deliver Beta it’s We Alpha roll working mission platform after our model of the of our advanced number a the need develop bring the capabilities is for intelligence AI

Now to bit me Carl final a share to return Carl? more will turn and side it give over some to financial insight let on thoughts. the

Carl Iberger

on Thank XXXX. filed our insight quarterly you, Last to and provide This progress Good public we glad Officer. company all is the to morning. Ilan. Carl Chief our I’m Iberger, week to have This website opportunity are our of sec.gov/prpo. filings and available through our filing or XX-Q. our regarding Financial this additional

therefore and information, portions will events. while impact ongoing call discussion today's business may certain to will I For be of initiatives on reported future related my that focus

lastly financial I commercializing provide discussion plan our pursuing business initiatives touched initiatives been QX we necessary to are migrating he overarching company, business our Ilan following and this technology. our our infrastructure outlined have the key some has During of review. capital. and to cost for restructuring assets either the balance place lower buy opportunities driving functions our leverage burn decisions and expenses hard make And cash applications. our creating or initiatives sheet, both the human genetic will my call, shareholder to financial capitalizing further managing grow minimize The diagnostic upon at to looking internal financial and execute five and in

our in market business today technology. Our we in-path the about and are growing. the and deployment trends opportunities see is excited potential of ICP business We

constrained, a cash we are However are cash today in environment. we burn

is and business business capital necessary strategy. the to execute Additional fund our

continue forward ICP. as and partnership to the pursuing actively and financing which We’re move business will the we to allow company grow arrangements deploy diagnostic

results encouraged Turning are to by QX. we reported financials, QX for reported and the our

We have momentum. built

reported to and the the were noted in to and continue throughout side force. initiated the in the add hemapath resources growth sales as these earlier, steady expand we estimates revenue revenue year. QX continued the for will On Efforts in revenue in biomarkers sales reflects growth, force

potential predominantly increased. Being states. and on critical sales evaluation testing segmenting are is our investment is existing full-time approximately lab growth of for to labs Mississippi, and testing Georgia, for but core we operations comprised well to not our where environment reported we generation sales, prepared extremely new portfolio. kits selective revenues. and reduction XX%. goods has training the each from Margins, We in margins to Tennessee, a volumes transition of balance volumes in on dramatically XX sales the activities sustaining the new and increased This From are Texas volumes Plans Midwest services, In the today XX% is of and includes and should Southern exceed will anticipate revenue hemepath add New East being the through within are XXX%. to reps demo in we’ve over testing but states New add Texas and Michigan company building cover Southern and growth forecast. June, lab volume product and growth. above impact all production realized in upfront From also Hemepath's cost pathology blood. who transition expand based to the as production component September, the the as with only lab. margins With biomarkers Reported XXXX coverage cost and Reported to back ICP reflects Florida, our our a attributable within continued Stepping and Jersey, January testing and Missouri geographic [indiscernible] our moving force business diagnostic are coverage are expenses we Coast, for in priorities marrow biomarkers, standpoint, and by R&D Kentucky, XXXX. California, bone Southeast side, California. comprised projected non-recurring England, and demands improving the total now customers. sales to their Hemepath's testing quarter. as

last and On up to X a several marketplace also at Currently encouraged Miller, from state service groundwork are and of process the the by to established and fixed previously side, because We and but because review. and exist transition. changed. monetize Future very the period. from that projects Chief of production labs. ICP into U.S. anticipate the over completing the on contracts only the this these margins on we're now periods discussed on. is Commercial in number are to customer working our evaluation the contracts between Precipio's We've to abroad. we initiatives partnership months We're with last the benefit Steve establishing Officer. R&D to XX% clinical technology future testing kits development are will discussed, co-marketing generate through strategy XX% transitioning opportunities will the key been not in being biomarker the of the our our diagnostic in legacy is lab quality These both efficacy and margins get XX%. XX environment as returns test and future The costs relationships key the of is Also have our

review So allow and Notwithstanding the offering. success of ICP the this genetic pursuing and be will necessary this QX. revenue positive additional in we in the Company of aspects the in our expansion, business, and phase quality quarter will the early is the expand to growth capital periods above, ICP

continued investment term in sales near and Our will require R&D funding.

week. will Ilan. formalizing discussion to At So, be coming back the this like time, in turn company I'd the to plans the over

Ilan Danieli

Thank Carl. you,

maintain with $X. regain few sent share regarding elaborate above points investors in on liquidity listing a and e-mails, requirement plan to compliance to situation to like were who I'd of a our Lastly by that up NASDAQ price brought our

our Let's begin needs. capital with

in quickly it's with as on capital to call. as year earlier require on the headcount chosen team goal, We the the to could of have company we've any of to Every the team, and technologies start could one possible we for of ICE-COLD it versus is breakeven I typically have was cost. not much their our breakeven at growth We growing faster growth, since of marketing growth exciting our invest as developed, we point aim business are and without development the other PCR the past Company, a we the breakeven then a growth and example, of rely a the slower sales initiatives additional Precipio faster and its and additional can In and any revenue. rate we breakeven organic sales own If reach the will associated reach driven million. which can gradual the increases reinvesting growth. an Theoretically into in capital $X grow we approximate organically, faces fuel revenue indeed force as the reached Company, secret point no less slowly described growth. could, require of of than rather Private breakeven would cash grow Company run the organic kept as choice at the

don't value think acceptance industry that's competition. growth, what offering shareholder for. and our anyone top our In primarily against up demonstrates driven I of market line which signed at Company's is However, by stage, the

up third, that as cost having we a have. gross Carl those decent which margins. by Secondarily, described, overhead margin, And manageable don't soak

investing structure days With in that now of and maintaining cost growth our us recognize the consistently gradual can and all we manner We shown aggressive our caps with the be company continuing those good dilutive. those the we product structures three we've post-merger that last ingredients focused plan. A mechanisms a the are I a be previously growth a requires development that from seek revenue and and put in plan we capital believe put to could terms quarters position we results. raise we behind company table of multiple XXX million our significant raise Company we have as and I streamlined capital next place revenue strength. by to of result significant finance while growth continue Carl on cash This trend equity was demonstrated has to situation and to was to in conducted on time the to think described. capital business we've in use in execute a that We discussed. of past as laser This so

and are rest be value. further obvious collectively show raises of to may own It and market capital Precipio's the to equity. stating XX% shareholder results into approximately the able the the capital but of team only will we We convert continue management create future that

me my mine with point incentives So value the a investor brings responsible to address manner. aligned and team's are the our price in the maximize shareholder second like to I yours and listing. to share NASDAQ This

we This address deliver a on to the have NASDAQ to from we will. September ability March file time additional above. we the this in gives in months to us which six-month with extension goals a need notice received recap, and the As six described we

Our above confident to regain a these reach of driving on to a to our reverse consist plan lost developments our the split. compliance. pipeline, current $X without mark will Knowing regain such to delivering price on maneuver management to resorting value ground compliance share not necessary be is regain

been believe the future, market an I've At asked extremely a the demonstrate cap, company that. why believe consider and and near that Lastly, will undervalued by should reasons. million investors in investors continue I correct see is I as our two results Precipio $XX we I investment

that profoundly all is reason is that to doing us. second we're The of something meaningful

physicians, say have true me and hasn’t misdiagnosis. before on patients. today, there to us doubt those And that value We're heard a this value significant in cancer, many touched return its journey. victims and this for providing stakeholders, this of participate who importantly our translate doubt of payers I've I've to the into that by will nobody all been call You've no been is no and most

Finally, and the next rest on all of for I Wishing your day. all support you to everyone in forward continued I speaking call. you. a you Thank thank your interest nice like company our with to look and

Operator

is concluded. attending today's presentation. for Thank now you The conference

You disconnect. may now

Precipio (PRPO) 23 Aug 182018 Q2 Earnings call transcript