- Earnings call transcript Q3 2022

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Operator

Hello, and welcome to the Standard BioTools Inc.

Third Quarter 2022 Financial Results Conference Call.

As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Peter DeNardo, Investor Relations. Thank you, Mr. DeNardo.

begin. may You

Peter DeNardo

for Good quarter operator. of Welcome Standard financial to market XXXX. September Thank earnings afternoon, conference third results its released XXXX Standard close quarter call. BioTools ended today, XX, you, BioTools everyone. the At the the

and we Presenting financial Vikram for Egholm today be performance, this Standard on call, and PhD, commentary and CFO. Michael Officer our and review BioTools Jog, will During market and Chief results trends our provide our operational initiatives. President; Executive strategic will

we the to that currently events statements our by These market be During available and occurred, to forward-looking and us and any actual circumstances from will in update opportunities. uncertainties except or materially for these statements call, forward-looking make disclaim including are may statements subject cause current that to information business, call projections required yet The results events are and about on statements, future law. to obligation this results financial differ and we based have substantial not expectations. trends and may plans as risks

not Michael a I to our turn this information session is website. During Please would Chief under note as during these the call that I will also present updated remarks consider non-GAAP company basis. Officer slide that to release. note disclosed and our supplemental accompanying as within some our Executive call. be over a GAAP on the Michael? conference Q&A will including referring presentations, and also presentation, also President. non-GAAP posted management in We the encourage are today, hosting information call, to now prepared reconciliation webcast our will presentation earnings Egholm, to financial which following carefully today's the like and information supplemental the on well you will table our financial we a results between be the

Michael Egholm

shows stabilizing Call transformation tools Standard executive and XXXX to in BioTools with the tools company and a with BioTools well-established business growth, focus on corporate green basis based in the first core this razor profitability our broadly Third team and call on There success revenue. with streamline science life how as encouraging growth, a is welcome quarter business, Conference holistically view instrument corporate our on new remains process assess consumables built of work Quarter but raised full begins now as execution. which we to and and The Standard XX% what that products Further leadership continue industry and razor-blade and shoots afternoon, this sequential of is will model, this Good service The business. service we of place. commercial upon we overall that team to as growth and revenue. well quarter do, products core the is

expense and margin While in by free focusing stated to XXXX, so end, of reduced those the by points burn year-end and XXX cash here goals context in gross margin improved reiterate we basis XXXX. operational corporate gross in achieve financial flow business, significantly underway on X,XXX year-end I this XXXX achieved operating commercial stabilize the To improvement cash positive are in well we we improvement. must profitability. And do

are all do next-generation capable and our a return stumbling I of frustrated prolific is XX that approach portfolio after It's from businesses scaling but the belief have the proven consolidation consistent, These and basic nearly keeping players business the former to right clear issues. are clear companies talent. across manufacturing, spent bottleneck? unsuccessful having long-term problems sets that been in that the is a in team life has tools, and These built too me and of to master. period Finally, you per technology and only for today. here with more industry, many disciplines model my joining small have of innovation only is operating industry. have skill bottleneck validated more solutions monthly. to product strategic development, business years different are players never of not business and the obvious are our business by challenges. commercial customer latter. need Luckily, naturally delivering entrepreneurs execution, large investment there It's and and I successful compounding of almost se, scientists the What the And innovation of science have with shareholders. and if That to discipline. is fiscal discipline mean also tools those in Today, model for the well-known are it mix the those innovation the support release and there experience, disappointed life many investors, the technical science

and platform to with capital We confident are expand. team, core this

just and growth million, but of in those growth, in in This of time. how on we're X% with product challenge, companies conversations progress has on before, again. compared the a to performance industry-wide disciplined growth favorable of with quarter third and doing target it all done on sequential XXXX product pharma and an are and successfully see realize is representing was service integrate XXXX. service to the strategy have our constant compared the our businesses front A year-over-year the M&A, been the On core to we're with through potential of for our on revenue eye and innovation-focused execute way methodically diversified approach market. and serving and companies science the over we to address key life XX% promise, businesses that revenue vision core research components macro tools despite required revenue growth not growth quarter of weakness over and element advancing third a the full using We currency to quarter beginning second platform to of EMEA. $XX.X we our create the It

Moving sequential quarter the forward, sequential renewed core with to fully continue progress. are focus funds it demand, that's on to is improved to The our won't sales service in a growth Underpinning untapped our revenue identifying beginning take and growth work discipline product track management and SBS. while hold synonymous and and we we're its approach the overnight.

rebuilt We'll our efforts We regions. skilled are team, done. all a forward, by strong results, Americas but realize attracting joining, sequential to of we work growth high we encouraged lot success the quality be year we and experienced standard leadership commercial sales believe to across drive sales there's early invest hard across macroeconomic markets still people successfully quarter. and this responsible U.S., the which in Since and part Geographically, the when continue ourselves in is to the the we for positioning Outside for become FX know the and are work these from globe. healthier. challenges pressures, headwinds early past we

via we priority operating our of discipline we BioTools or which second to apply improve do is System, to is Our SBS, a and as thinking multiplier. view way Standard business. we every Business of everything that force Lean our facet

and of embraced our the to out continuous and displaying that of We I'm stated SBS benefits continue proud by achieving report X,XXX roll SBS into for across see goal to basis revitalized the performance, XXX points work cautioned margin improvement, are price beginning year-end a the approach sense has gross to way we and translate a training of on team organization, XXXX. empowerment of the We're improvement and to do. our we to

and growth in result We in volume driven center. year-end by and to lean controlling expect transformation front XX% this non-GAAP by gross of In margin environment, selling. service and XXXX, product this XX% is to costs value

is as make flow and cash to you well believe spending goal. approach that administrative doing burn outlined, a entails a expect less today reality, plan, is to by can portfolio In we our to XXXX. I just as we excluding we business aim reduce rationalization. August, reduction year-end. Our more we restructuring to this. rightsizing but in to are to expenses, what positive than We're business generate I joined, which microfluidics cleanup The significantly we There's operating which year-end improvement on way further when and do phased team general substantially reduce tell achieve our expenses, brought announced in and to this do, we cash I

significant We count free head have our efforts XXX well a cash XXXX. in XXX of footprint flow points into margin improved basis net positive year-end our estate X And real reduction in an date, South smaller restructuring plan next the by annualized basis. and are to or Chapter headquarters. on To with on by operating $X we'll Francisco generate San to our restructuring million phases execute

necessary investment our supporting be growth, is which we the capital time. allowing deal in to in are future areas same functions gum but our talent. we the that where M&A allocation. SBS our has us impact product for at to targeted infrastructure big me changes get and integration example, priority, to own the business, core not targeted can proprietary will ready and position M&A, its frame, the only biggest in several complement brings cuts third such for full. our chew bringing business strategic We is through our portfolio across look walk to time enables as also but We invest required pipeline can other R&D in making it

M&A on the We business reinvigorating aggressive while intensely focused at on strategy. are executing our core same time, our

revenue have strengthen and seek with We with and opportunities to potential researchers. infrastructure clinical connection our our that translational synergies pharma funnel our continue out to existing and partnering to for

the growth we some we know to initiatives, in at earlier and on look been industry's organization Conference you best mentioned have build We shareholders London the and a to can to allowing our that for infrastructure. As organic forward Healthcare to shared Jefferies meeting next global my we both prepared week. tirelessly know with support our and work the working us inorganic streamline offer mission, of innovations remarks, the foundation

Now let Vikram our financial results. for to over of Vikram? me a review it turn

Vikram Jog

Thanks, afternoon, good and Michael, everyone.

with America the serve. team of the pleased that have by Michael This is showed illustrative and we team. top leadership results are the quarter, new geographic our the all we across made markets As improvement which improvements rebuilding been sequential for the our line of noted, sales third

$XXX,XXX. microfluidics begin ago the and sequentially exchange an up cytometry of constant me core XX% down increase approximately segment $XX.X in review revenue Core revenue the our $X.X million, $X.X was Other instrument up revenue, of million revenue and service quarter final Core across and of $XX.X a of quarter, of revenue third mass from from in with tranche third million was was year million million from $X.X approximately XXXX. revenue grant consumables was of revenue $X.X a third sequentially which includes and the let and for sequentially million from $X.X for year-over-year the was and at Core period. the X% the product Now development, legal million of $XXX,XXX and of and rates. for license year-over-year. sequentially included year Total settlement $XX.X up flat ago million quarter period.

We sequential regions, EMEA growth respectively. are in pleased with business Asia Americas, with the the in XX%, and quarter in XX% the and Pacific XX% our recovery

see team line implementing sequential America all We are increase revenue rebuilding sales across beginning geographical a to including across contributed operations, systematic the of in SBS North the top sales approach. and This our regions. benefits our to

For revenue, third please available. geographic XX-Q our quarter refer on additional filing commentary breakdown, our to including when Form

our to on operating now performance. Moving

higher of on which to the in Our XXXX. actions rationalization incur the business the our to $XX.X was end ended the and September net reconciliation lower in operating $X.X loss million September forward nine GAAP the $XX.X loss bridge the GAAP million $X.X improvement impairment measures These new quarter and subsequent improvement included XX, XXXX, August of to related to net of higher increased release $XX today. and we the portfolio million items losses Series loans, at exclude XXXX. nonoperating and at certain and Non-GAAP the gross loss for compared million restructuring by million of a management net $XX.X will and of include of compared the operating XXXX certain XX, the business our second focus stock related non-GAAP approximately quarter margin. by and preferred InstruNor I additional transaction was into program GAAP quarter, balance prior and financing press that for reflecting taken our assets. results, for B expenses XXXX comments to the reported the earlier the These my Please primarily are that million for expect ongoing, earnings product the and items are related related of team, results three the $XX.X and million including intangible was although to items. QX sales months issued $XX.X ended actions XXXX. announced note level. primarily between in noncash in loss fourth quarter and revenues ongoing strategic tables XXXX, non-GAAP million provided

contract. and XX.X%, quarter QX of and charge the sold, XXXX, product goods we down in of $X.X year. last of termination million manufacturing to Over these quality were included manufacture impacted second microfluidic early will up our Non-GAAP reduce action this termination was from costs. from the to we of XX.X% manufacturing believe third service related cost quarter both During the manufacturing the charges product incurred by instruments portfolio our will a we our time, Margins for in facility. quarter, rationalization and of QX but Beginning related for the Singapore in contract. and manufacturing improve margin XX.X% instrument in

Excluding in $XX.X year-over-year Non-GAAP increase charges, were down $XX.X margins approximately for QX the the primarily business period. improvement charges actions and sequentially million ago and earlier. and mentioned product both by million, related that expenses to was year million operating these service were non-GAAP compared driven from to the I The XX% $XX.X QX.

Moving on and as sheet. equivalents were and compared $XXX.X cash $XXX.X investments million flow XXXX. and of the now cash XX, balance million June short-term to with Cash

QX cash During was about from quarter, million million $XX approximately down $XX.X the sequentially operating our of burn in XXXX.

generate and cash free by flow reduce one of mentioned, XXXX. year-end operating burn Michael key is cash positive goals to As our

additional concludes over on Peter? plan the We beginning This phase now call to expect as restructuring progress Peter. I our remainder benefits turn previously my to see the quarter. here see are of this to through announced the into and will continues remarks XXXX. year

Peter DeNardo

quarter attending of replay We'd XXXX Thank third for on to results thank Investors section this our call. like available today. Good the website. concludes call our everyone. afternoon, you, call be Vikram. This everyone A of financial will our

Standard BioTools (LAB) 9 Nov 222022 Q3 Earnings call transcript