Earnings call transcript Q1 2023

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Operator

Good day. And welcome to the INVO First Quarter 2023 Financial Results Conference Call. All participants will be in listen-only mode [Operator Instructions]. Please note, today's event is being recorded.

I would now like to turn the conference over to Robert Blum with Lytham Partners. ahead. go Please

Robert Blum

much. thank so first everyone. as And XXXX Thank for Good joining indicated, call. you results INVO us Rocco financial you conference afternoon, for quarter today's

INVO's will us the today's CEO, session. Operating Joining a conclusion and Business Goren, of and of open prepared for Mike VP call question-and-answer Financial the the today Company's Officer Steve the Chief the Company's on call Shum; Chief Campbell; Andrea we Development, remarks, are Officer. At

financial or event, submit the meaning this be and Act Exchange for XXE such plans Harbor Safe company's or risks, actual the Act INVO to should, involve the XXXX. anticipated which may, that statements control, with similar to include forward-looking materially Securities statements. words Certain or are of competitive results, such and expect, new as All All on in statements forward-looking statements beyond within believe, Factors performance Litigation opportunities, XXXX set of will performance to record update products achievements of of of may well and which may positions, forward-looking cash and business could, provisions management and other begin discussed as differ services, company's at strategies, following of Section our objectives plan, of future results those results or pursuant the are of to conference materially Act we actual as results the as intend, Reform results, company Before statements anticipate, operations, statements, the events in from alter Private if, contingencies, Securities flows, expressly the we is as financing forth are the future XXA achievements. the cause forward-looking statements. amended, statements obligation Bioscience management of position, estimate, include cause statements of forward-looking differ growth many company's Securities the the expressions otherwise. uncertainties regarding from any information, for the disclaims obligation no Section plans, amended, future matters XXXX The and of operations, www.sec.gov. may such forward-looking filings under made by call to of those as the the whether that expected

Steve With let Executive Officer to that proceed. the INVO. over of Steve, Shum, said, call turn me please Chief

Steve Shum

Thank you, and Robert, welcome, everyone.

many year a where As weeks you recently ago end covered of just our we updates. held important of know, four we call number

shorter plan further combined a believe an In Centers INVO of from the our most first centers call. method, quarter the highlight quarter, some positive trend we over will sequentially ago the generated upward fourth the remarks both and call, in approximately covered year XXX% developments our three well as of the basis, We made and increase the first as continue for of On new reaching progress, those accounted recent for they this an the specific keep key levels. Monterrey, to and prepared in all of last quarter inclusive this the reiterate For the items Atlanta existing Birmingham, equity increase consolidated quarter, impressive year. the and quarter. from XXX,XXX XX% rest under as the

flows near the each nearing positive that and cash breakeven and key are in profits future. of Another three clinics generating make look point is them to existing to we the forward

a Tampa midsummer year our planned slated mentioned end progressing Center As year. for INVO opening with we target is new on call, our this recent in

center we're and planning into large looking market are operate The attractive preparation the about excellent the and Tampa operational. they well We is believe to Tampa. and we training opening. bringing for practice excited We team in and assembled an phases have the forward the to are

providing We preparation to expect and this and do forward for work that near for City to in future. have very market on early about look potential excited begun we partnering updates remain Kansas location the the

decided opportunity hold agreed ourselves both partner we Both this now. put right key clinic Bay sense priorities are made on have previously now. on our and Area mentioned for to We as mutually the other focused

acquisition the to our you us, of want Institute. to announced call, strategy Wisconsin key activity will a few remain into mention For build fair but our that last amount specifically spent key and I as believe around of and many we established commercial fertility IVF of. focused an time new company profitable existing as the know, priority synergistically highlights a transaction efforts is our ownership effort enhances INVOcell existing, We revolves clinics can a on we our a acquisition clinics. reminder. where and approach the the our to This strategy on and take do acquisition agreement discussing We acquire introduce

years clinic. reflected the financials Our the nationally on financials a those local during with we review the community X-K pro forma run And in part fertility first but of not It INVO’s two operations along that it in historical an months of located been top an the of as then is profitable. provided Wisconsin, which transaction, had America. basis nine is audited period. for if the deal, well reputation the clinic regarding one and only centers issued excellent in We has

about in million on material very operations the with forward produces addition to trailing excellent $X.X basis. income, results around those clinic reflected As a a go in million our $X.X revenue numbers, net and and

net our public the approach As company overall our our as status It pathway to we've highlights to our acquisition accelerate to adding a and operations, use take our platform to fertility for are a and strategically scale mentioned profitability. comprehensive several marketplace. provides efforts It efforts previously, overall reasons. positive revenue more significant immediate income within

treatment and in becoming activity of of INVOcell company help IVC do this acquisitions goals we through are the one broader method. a now still the key further Although fertility longstanding our advancing general, technology

revenue new added our efforts our patients IVF look already are established we and another need. provides in the clinics are smaller conventional on acquired care existing, these marketplace in help to Again, to and into affordable established focused the practices addition to to will We integrate servicing now do manner IVF acquiring business bring pathway to expanded new further the across attractively in these to efforts. discussions focus This them and practices expanding acquisition solution with existing to profits now Wisconsin. practices. in help deals to existing midsized have ongoing providing. commercial structuring additive IVF marketplace includes fertility pricing win clinics, and several We selectively summarize dedicated and Centers INVOcell and To a will win, on INVO strategy, building supporting and our similar drive

the the recent label good As questions end those very and significant our of enhancement to outcomes we've made and We the possible. the week. with data the our tabulations, those this with call, share completed as with noted looks also submitting are the are very progress We at related and soon FDA market pleased on to five additional believe including efforts. from follow-up day the we data, additional excited as tabulating

Andrea financial Let me to quickly Andrea? highlights. turn this over cover additional to

Andrea Goren

of of the XX% in in clinics. revenue of prior $XXX,XXX of you, revenue compared quarter the $XXX,XXX XX% from prior consolidated $XXX,XXX sales Center INVOcell approximately IVF consisted represents service period, comparison the product INVO The year Revenue $XXX,XXX totaled Atlanta to Thank QX revenue our approximately to to the remaining in or approximately year Steve. for period.

in awareness Centers increase operating our year Revenue in totaled prior reminder, for from in a compared revenue and general. the the impact Monterrey their marketing the As all to for in using clinics Birmingham build The period. the equity and cumulative respective accounted quarter of clinics, INVOcell $XXX,XXX in INVO are efforts and services IVF three method. $XXX,XXX the to reflects

Center, INVO's year, revenue the throughout to acquisition, continue closing increase We financials. the substantially will the opening to as for be of with wholly-owned well Tampa expect and revenue XXXX total the and of our both clinic existing are of consolidated to which own as Wisconsin build the INVO with

improved INVO at our gross margin a to of XX% as Center. from Our efficiencies increased Atlanta result XX%

period, prior $X.X to of as expenses based compared noncash the approximately expenses million selling largely general administrative result basis, approximately $XXX,XXX a Our and had compensation. from in year in combined attributable INVO lower Atlanta to period. Centers $XXX,XXX a the On period. approximately our three $XXX,XXX to approximately prior decreased expenses prior million Centers included year $X.X These the to operating compared INVO in year our approximately $XXX,XXX stock

year. adjusted of adjusted loss, to accounted is with EBITDA noncash and improved equity to included of Our approximately million the $XX,XXX $XXX,XXX losses amounts compared method. compensation, based attributable operating These Center $X net which for joint ventures charges, million equity INVO related respectively, our to last EBITDA loss to mainly of an $X.X

in transaction at stood XXst, our the reflected an balance joint March from intercompany not consolidation as Atlanta which receivable was note and Our sheet. $XXX,XXX on eliminated on is venture,

investments $X.X gross equity was to ventures $XXX,XXX March our million. addition In the is remain Monterrey and investment quarter. in through unchanged amounts joint Birmingham respectively, XX, this from and XXXX $X.X To million last the which our note, date approximately

also financial Our and remains a clinic's closing auditors the the date well acquisition a for our results, on in first the as track quarter. audit as with current quarter. the work of to of working close Wisconsin to the XXXX We're clinic review the complete

to in quarter. file results these expect current We the

$X.X we XXst, March debt. of and in in cash approximately million million $X.X As had

We approximately have debt. repaid convertible since $XXX,XXX of

offering during of the in first closed stock common and of on along we a prefunded As direct quarter gross from with a reminder, private million registered warrants. approximately placement warrants, a proceeds $X

a of For and shares private expect warrant placement to offering, register certain convertible our $X warrants file the XXXX resale debenture we and February million to other the statement related to the terms registration options.

million warrants options X.X we today, have million of As million $X.X stock prefunded outstanding. of warrants shares and approximately unit outstanding, approximately common and XX

you, to Back Steve.

Steve Shum

Andrea. you, thank Great,

reiterate. just we for strong open for let XXXX. we are questions, a Before start believe to me We off

existing standpoint. a quickly record from We sustaining equally clinics cash important, are our flow becoming they volumes seeing at self and are

most We opening an build of INVO strategy provide added efforts in are by where year. growth important, Center, way build new rapidly close will to the in operations. perhaps we Tampa evolved which to INVO of our commercial And adding our can acquisition scale the we've the more

key technology takeaway focus half, INVOcell past As simply understand and to our to company are activities evolving beyond a the medical the investors and want over that a selling year a device we and device. our we

the large become and marketplace. are growing offering We focused have and fertility patients on to within integrated treatment an clinic solutions now company

are a As we different today. company such,

our enhanced However, INVOcell clinic the approach the and grow we also that that In need. in patients market utilization along bring as of our unique the achieve within put we much us process and can treatment also help some, naturally will that care us position this IVC and in service with to objective a help efforts increase our building commercial one believe affordable and believe well. activities technology needed thus

up for open now will questions. Operator? we that With

Operator

from ahead. [Operator Instructions] comes Group. Maxim Today's question Please first go McCarthy Jason with

Joanne Lee

is Lee the Joanne McCarthy. progress call Jason this This on the quarter. for on Congratulations

XX% provide then you So there rapid being were I to the drivers a factors QX the growth wanted this or events of key was just to a the ask some gaining outside what led to can operating the in revenues, color follow-up, increase sequential primarily promote were adoption influenced on as clinics? around, INVOcell by seasonal of that behind traction? And implemented the specific strategies

Steve Shum

-- inherently awareness conversation Well, the in a of last to actually go in, the really inquire markets help. there reaches see or is when number they interaction, a has been consultation clinics level between patients coming we and patient that talked an building where operating the and are I clinics patient before of initial and to lag initially when happening treatment. in effect seek out what's think quarters through But about we've with something is increasing we've over the

that now move the like any to continue thing increasing period. why been financial we that wasn't the actually of clinics reflected to which been hadn't specific activities clinics, this going practice through And that's that to as just again, happening And towards building we that's from in within but seen and the building been into again, the past a in new volumes is practices. the were of results feel here. so we've It's of or been, develop, There forward starting we've flow doing is expect to that that necessarily awareness is building lead just, treatment operating starting build year. we will in culmination building for are patient say process attempting that the the the we the that

me. you excited show that wouldn't we're And repeating will for mind in to up if So I I second part of that and the forgot numbers, see think start continue. question, apologize, we the to your that

Joanne Lee

you of Can INVOcell operated follow-up. just clinics? strategy a of sort implemented being provide the some outside Just promote color the on adoption to

Steve Shum

strategies, pursue trying number within We INVO. -- to markets we're is say of the supportive you a of well of forth again, know as the on seeing ongoing Google We're on continuing I activity technology. see we're drive so OB/GYNs Mike, the build Well, do to awareness additional so think social familiar want we're are to any more that. that, patients just increased to and and -- the to growing and generally effort. I around around as certainly INVO levels done would rates to further publication and referring success forward if And a Adwords both there physicians, that around with its we're looking marketplace different add seeing local media, don't outcomes continuing in just the awareness to of occurring technology. that's that

Mike Campbell

of Yes, a help. couple might comments that

that the key capacity. with particular think strategy is issue I

only So US. interested them, it. very technology everywhere. a is and clinics to we're we're But we're of all previous why We've know these busy, is our INVO. them the the issue, There a there's patients them and how adoption this to are in use technology, IVF of experience to in capacity we're certainly use And is of in they XXX here. the lot IVF had increase the tactics this we getting their not teaching why this clinics. is technology bit well. but in Center a XXX definite US them, training changing about clinics, if have there, with they're the is helping again, We these IVF

Operator

Our Instructions] Rodney today question Baber Investments. next [Operator from comes with Paulson

Rodney Baber

Steve, can okay? you me hear

Steve Shum

can. I

Rodney Baber

these Wisconsin is least, this buying going to the of say strategy quarter. one intriguing second in the clinics you're to new very This and close

all of And that. year over kind million] next $X EBITDA getting So hit so. or to having coming revenue your and into that close to that starts of million offset stuff of [$X.X we're then and play losses the

going to mind, years interesting been it couple a makes that's execute watching challenges here long. thing my with me, that be time to had that for takes So the sense has see. on you so but strategy to on to The been having you and the of it

I think in you've Wisconsin year. been like for with a negotiations

In $X that clinics, hired for question of what other clinic And three in my to or to aspect are beef the so people what company a four your have what is, you piece, words, does million up company. department your you doing like? find got pipeline the a you business? clinics If new add million go at acquisition look you can $XX

I'd would the thought you how think quickly be it hoping that on in on what understand was faster understandable than better an to execute, process going that it's can So be past. go-forward love to you

So on I clarity love some that.

Steve Shum

documentation that There Wisconsin process. for lot acquisition. think other were some delays the we've that probably we present structure the necessarily develop developed on cut one of to that -- time and a and will may a some so the of I next the down of the and that that acquisition. Well, or unique in certainly the through forth some time of that I took. deal acquisition, we I have additional process can potential set learned it leverage feel the not element that paperwork elements we that that quite again, think form specifically again, created think next certainly, a may Wisconsin the in bit specifically because can streamline But reuse be length the was significant we to the that We, through we tools legal

ready partner expeditiously. the is really ensure We wants move and forward go to process to to that will next the potential look

get are to of that elements having elements able So us resources or -- do again, some people. from would of added But line. definitely certainly, line not quite to I process. a said, time to some bit we'll don't try of resources shorten be we have recently, accounting to envisioned. operations the than Wisconsin having took a We''ve and those function things with manage added was that the and it important we some finish that to like We here And that to scratch. some disagree longer the create

where couple we resources We we some so resources. ensure ensure add to wrong, of activity, we'll right. focus to enough quickly. on I need add acquisitions. to continue additional along, we that we much think right not we But We to look you're potentially to can we like that necessary said, enough move people And to potential do more resources it pursue people, as may next the have think have now

Rodney Baber

somebody you independent, thing happen with that? what there they out staying this versus see, do of reason what this think way, end they guys your did is The what company encourage that move in them throws of to with do see to Wisconsin going because

Steve Shum

strategy offer take platform, amount coming from the think interesting further acquisition Well, in platform frontline probably on can that company, partners the the growth with our this. opportunity in I that that opportunities. is to which one public we and into we're to new add to he's can of that discussions appeal has form public in of them these they some some offering overall of this, we in areas, But a potential can two a ongoing fair Mike fact equity I to acquisition offer key is a can potential on the think of the benefit potential a

solution be the they potential acquisition which to and provides merits it's would that technology, important again, the technology to to obviously add the because our they I it think that technology itself and our clinic understand of see talking it is the helped also, a to partners get can what growth clinic, we're of when they technology can doing the growth and helping and they're participation. benefit integrate a to But of then help transaction clinic. that they get part achieve the in with us, critical by it potentially the bring a grow doing potential

So sell available their in clinic. I offer always think are routes that in those unique alternative that aren't might we can which they elements

Rodney Baber

there how -- sales without procedures sell people product buying you $XX,XXX Steve, deal market IVF sudden, got and going to on handle you open the issue Or $X,XXX and product sell with Do do product that a $XX,XXX brand-new new the do people sales bringing -- IVF $X,XXX. you've going you in before, of that you that? with in process do the losing to marketing and a a all handle but $X,XXX how you you've with weren't for got a how how which to forward, product to line? so do product, you up you do you integrate penetrating strategy of you lose don't revenues that that's

Steve Shum

make entirely base, had affording challenges point treatment one did the and you option and that we that an is additional new conventional have opening more Well, maybe important see do up the solution patient those IVF.

-- you're the pretty our of their whistles done integrated program. conventional independent the when we've that that have they job our good a positioning a seen of technology solution that think technology or and some and added of as with offer clinics bells clinics outside I doesn't IVF that features have have maybe

a can as add maybe features that patients And again, are cost so they option suited position for costs. necessarily that those need and additional of don't some ideally can, lower

you is to either. about occasionally, market. right, sort a other opt additional an would may there's there going to also be that's or and patient the there's could first So I targeting one do to patient some it tell overlap, suitable do -- foremost, be that of really, But

focus can the targeting an is some that is So patient. there but additional again, crossover occur,

Rodney Baber

jump out for like look and Final you deals, this, robust of thing you? other does How do think pipeline think you now. right and I'll the closing some the the timing acquisition pipeline what is then to that

Steve Shum

measured Well, resource I pace we that take very constraints. would our say want a to given

well when bit, what they've like talked he's received. is So he and that engaging about often in quite often we're I be this believe this asking a can seen me -- a more Mike because aggressive, is I conversation

than they and to pipeline on manage so could the more probably faster maybe back fill ability we the the robust have And end. or handle

I So news. the guess that's good

-- measured we're so a And take a again, at very sort pace we of but this. to want

Rodney Baber

we annualized staff I do What rate the the run could through timeliness you now, being your about would you acquisition with how three could have year? you have add acquisitions of this could of mean, the a these much of on what's expectation strategy?

Steve Shum

a mean, think be I one a today, probably sit manageable, doing on each acquisitions is. depending as I year we couple would big three how of

I more we our increase and could think supportive, if were capital and active to opportunities it faster a certainly something, sense resources made grew our help pipeline. look manage markets manage to

before walk you of sort run, guess. I So

Operator

Shum question-and-answer closing back and this to concludes your like gentlemen, Ladies conference turn for session. to I'd remarks. the Steve over

Steve Shum

great. participating with Well, to appreciate We us not And as you any hesitate today's please Thank for your do out always, in interest. call. to all again reach additional questions.

Operator

Thank thank this gentlemen, you you. conference And today's presentation. concludes attending for call. all we Ladies and today's

You have disconnect a may lines, day. now your and wonderful

NAYA Biosciences (NAYA) 15 May 232023 Q1 Earnings call transcript