Earnings call transcript Q2 2023

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Operator

Greetings. Welcome to the TOMI Environmental Solutions Incorporated Second Quarter 2023 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Later, a question-and-answer session will follow the formal presentation. [Operator Instructions]. is conference this note being recorded. Please

now John Nesbett will turn the host, your to over of conference I IMS Relations. Investor

begin. may You

John Nesbett

Good Dr. update and Officer, for TOMI you Executive E.J. Officer call afternoon, Shane; today of Chief TOMI's and the the Nick Chief Chairman for Officer, Board, is joining TOMI's Financial Environmental Shane; call. Jennings. TOMI's conference us investor Chief and On Halden today's Solutions thank Operating

E.J. an will you overview quarter on of performance Dr. will Shane highlights, latest Nick report any may Company's business and for will review and growth questions provide before addressing recent the recent financial have. the trends, most the

included issued available at A replay call August be telephone be XXXX, through today. will of press also www.tomimist.com. website, available will today's release which the A in Company's which webcast was the replay are TOMI's XX, details of

is of of of management XX, Please we're, no in this Private Certain within XXXX. constitute to from anticipated could that Litigation results differ time-sensitive information forward-looking TOMI statements actual time to the in of accurate presentation note longer should August results. oral and written recorded, as materially replay. only was may These be our day information at that XXXX. important Reform defined Act advised be it statements factors risk that may the relevant Securities the any therefore, forward-looking contained evaluated statements by And of made light cause any which

to of after The Company and call. is update upon obligation facts time. known conference circumstances at call this in no statements this this the these forward-looking provided based information The date undertakes the

included performance non-GAAP comparable believes financial these discuss Company that non-GAAP to will with could this GAAP by because measures dated in is measures. considered operating information the conjunction certain reconciliation the August they earnings XX, it TOMI in release measures during investors A about The measures measures the XXXX. GAAP of useful addition, be In non-GAAP call. provide uses

TOMI's Chairman will ahead. Dr. I Shane. Halden now Please turn Officer, Executive Chief call and to over go the

Dr. Halden Shane

prudent John, even and a and located. driven financial on XX% perspective The by expenses. you, consolidated made We upon profit increased quarter or EPS operating summer portion quarter afternoon evening of morning Thank our quarter XXXX second for second same management of financial of were for results results for joining revenue sales, results Thank improved the our for since from profit, you grew you're net gross we've a nice with we depending best XXXX even some afternoon small as by us the boost to of over operations. or The of our and quarter. statement are where an of on the proved spending good this and a strong the EBITDA broke your seen XXXX everybody. which the basis the

for June the months year revenue over XXXX, XX% up was Our period. six prior XX, the same ended

team's service to in the SteraMist to XXX% XX% SteraMist revenue revenue service revenue revenue second attributable growth consolidated and our of deliver reported and well iHP to and revenue basis, The Systems, as measured Engineered as our better in of known first second the was XXXX. for quarter During year, strong second ability quarter, in product when iHP product growth Custom revenue quarter our against second XX%. by our grew our was sequential to last compared our the by the a quarter up On quarter. execute grew CES for largely the net as

quarter-over-quarter XX% $XX,XXX, represents a a realized we net In of slight which the loss improvement. quarter,

the first in XX%, to loss compared by quarter the incurred improved of Our reported the operating second loss XXXX in from XXXX. operations of quarter

quarter period. second same share XXXX and prior to reported the which year per basic of was compared approximately same adjusted ended per represents improvement loss zero prior in earnings basic the diluted XXX,XXX share loss per compared EBITDA three a X,XXX a to year of was XX, XXXX, for share, EBITDA X% and Our the period. June months for the

we significant international progress domestic Year-to-date, have expanding distribution and our made partners.

partnerships recognize us take that significantly. partners that effectively. extend While we increasingly we firmly our to believe with and through market time it we to in expanding new train, sales onboard, capabilities these the work are But and partners will will these enable support reach our selective

adding We Africa, mission-critical XXXX, in with and domestic XXX far ended added North a leading representatives. in Avantor, independent products and a have tandem new manufacturing a of we agreement Fortune into new company, while recently six America, supplier services. Europe, Thus and distributors throughout distributor

agreement a activities and the distributor biopharma and and expect vital expand sales development our We advanced the research in channels industries. to space into material government, technologies room healthcare, clean production applied for

as To added Italy. international a our distributor in we in IBD expand presence business development Europe,

conference an with inter-effects during Our partnership this originated earlier IBD year.

event, Integration existing TOMI in the the collaborating SteraMist Currently, are of of opportunity acquaint manufacturers equipment early During IBD and customers at Italy. clean the TOMI's and of stages potential with multiple System evaluated room had of subsequently IBD using our the or efficacy one for themselves to SIS. with SteraMist its in

market. presence with around XX% the more in in the acute GPO Vizient the group nation's a academic we quarter, Incorporated, industry, in contract billion U.S. than annual largest increasing Vizient is and of XXX XX% of volume. also medical ambulatory the organization, purchasing healthcare system. serves second serves the the more of our healthcare During Vizient entered supplying nation's XX% than health approximately system, nation's centers, care member purchasing the

including Systems range providers centers, health a enables academic medical and contract facilities, network. to community wide SteraMist pediatric of splice Vizient's to healthcare through nationwide us This providers,

course, presented initiatives our brand Vizient this and our remained quarter. second intending attended be will products of different We SteraMist active first nine with shows in trade during later the marketing at year. and our We, of conference

with the company's objectives over to you, to and Shane, will plans hand like I'd an point, provide Elisa of the COO, for the the TOMI's this Thank year. overview call E.J. upcoming rest of At you who

E.J. Shane

opportunity appreciate share will Biotechnology collaboration growth on during by matters good the active. CES, the with some Thank discussed The and which everyone. several continues German to is to our to you, begin I progress, for Dr. on developments to Shane, call. call. previous providing upcoming orders today's Company, updates lead and I TOMI's afternoon set very trends, be our

foster partnership universal long-term with Disinfection, TOMI. Our to partner, this continues directly

of expansion In SteraMist their brand Europe. across to addition continued in areas iHP

of scheduling Consistent orders, for it especially once to the timelines. is customer larger anticipate year that calendar large this of for few worth in orders units, noting our our flexible custom the and previous the We with opportunities. communications, closure within these remains some a response again

to crucial remains it's robust very and pipeline our However, promising. emphasize that

we the second additional bringing call, successfully our last our during systems, anticipated quarter to XX count installing systems. concluded by custom-engineered installed As SteraMist

to close operational projects qualification Our by to and are revenues quarter set the remain facilities production readiness variable timeline end and be the operational user's of solutions this from to undergo of first upon moving forward. of services Naturally, contingent the the leading XXXX. recently installed is associated bit

USDA. their now enterprise farming include the actively partnering with Our the continues in engage indoor we prominent qualification which comprehensive as solutions procedures, collaboration up with

occasion allocated has securing all structures to organization utilization Notably, food a final partnership stands versatility applications. the efficacy construction within resources SteraMist expansion of partner growth the to and demonstrate of development and SteraMist for TOMI this as approval, This potential substantial. The pivotal of dedicated to remains and extending reveal initiated farming or across on for facilities. this Upon publicly new we entity the upcoming iHP for this realm intend safety. indoor through

ongoing dialogues our by custom-engineered potential last systems Since XX. with interested in call, our XX has to earnings expanded clients

Our strengthened this trend our confidence interest. in of fully continues automated iHP to the prospects grow, positive of by system

conversations CES $XX for equates to product proposals ongoing and the Our collectively million. line approximately

attests the Some of to in years. are for engagements potential to be conventional few demand technology over and installed are our some the game-changing near-term significant projected replacing practices. next these This and

Notably, design automated and of new for is mentioned Integration Shane for earlier. SteraMist roster chambers, Six from considerable collaborating known these the has the consultants been is product partners solution module seven an clean in rooms. traction. gaining contamination. washers, impressive This our Our of introduced to iHP of Dr. manufacturers interest turnkey All cage integrated or TOMI key System cabinets, expanded to solution iHPB and decontamination keen as this From through or of have implementation partners on expressing which an manufacturing assisting with adopting distributor, XX. our equipment. European new SIS

is relationship earlier that Solaris a multi-billion-dollar particularly Cell quarter announced very manufacturing therapy growing industry quickly. is The exciting. this we

worldwide recognition keep other as our technology Our advantages environment is sterile a manufacturing And aspect strategy. therapy we'll this pivotal for offered to into our cell continue their system. commercially and Maintaining integrated updated available decontamination Ensuring methods. product progresses. critical relationship a you over Solaris, of will remains be

remain segments. enterprises our prominent to market In engaged with that addition we Pfizer, other deeply collaboration our specialize with in global

has Kabi in Fresenius evaluating qualifying are spans other facility across which locations SteraMist the undergoing the product with and example, figures company, process. viability tandem, facility the countries. the many closely are we For key working In around Brazil globe, XX in equipment in procured

put to continue on organization effective onboarding, we and customer education, Finally, focus support. considerable on the

improve, repeat by number growing our orders the broadening to of continues reflected base. service existing customer customer Our from

will I Nick our turn to over the and you now Thank Jennings. call CFO,

Nick Jennings

same second I'll our you, provide overview the for and Thank to a compared hello prior everyone. period. the brief of year results E.J., financial XXXX, quarter

compared to our XXXX, June XX, mix decline gross to $X,XXX,XXX in For our or representing the of was compared Consolidated June our XX%. and XX%. months product was XX, sales. net X,XXX,XXX XXXX, was to due $X,XXX,XXX, revenue increase an XX%, three compared ended profit consolidated The gross to profit

or decline loss gross consolidating to $XX,XXX, sales attributable The of year period. The in higher in current compared the decrease and to representing was $XXX,XXX operations operating from our was profit a $XXX,XXX, loss XX%.

loss compared Adjusted table appropriate was or loss share. approximately included GAAP and basic a net $X.XX of A financial or with compared $XXX,XXX. press EBITDA diluted adjusted $XX,XXX EBITDA consolidated the Our $X.XX to share per to is today's to reconciling basic per $X,XXX, release. measure was $XXX,XXX

capital of cash XXXX, and was $XX.X million, shareholder's our the cash to Moving were equity as $X.X balance June million, on equivalents XX, million. $X.X approximately and sheet, working was

like turn I'd call Halden back Now Shane. the Dr. to to over

Dr. Halden Shane

in on a into all Thank and We Thank of you for believe may you, second us for and we time results your questions, open you half point back lot this to and followers of forget investors us have have Nick. beyond. believe Operator momentum don't website and company. given our support please. And the as support. to your us today the our your heading for www.steramist.com. fourth of second in joining new XXXX. quarter and obtain track our unwavering quarter we at that time, Thank At profitability review

Operator

first have from question we our And [indiscernible]. Instructions]. [Operator

Unidentified Analyst

question. taking for Thanks my

think we obviously, gross So about business. forward in should the the your was very are attractive. wondering business just gross scale you margin margins I going how as

Dr. Halden Shane

model, scale, equipment, installed So, as is really more drive we into solution as base is type raise, we our margins see which should blade basically of our we which particularly gross model. potentially the improve, a raise sales

gross I relatively our how to contributes a think have low that's question. for breakeven So Again, relatively margin, the and it and Thanks it's. we high point.

Operator

AGES Our next Felte Todd is Services. with Financial questionnaire

Todd Felte

Congratulations a look had I on on the forward and the, oxide. profitability. ethylene to I even future uh, to the return one break question quarters of

You had just was made. oxide there's on viable the progress that. for was that if with curious exposure, April XXth, release a SteraMist ethylene I been press know solution and a any dealing as

Dr. Halden Shane

a supplies, some doing oxide a that have regulatory It go medical prove sterilization. had that we again valuable is work and alternative processes very standpoint to currently, and to be ethylene And in and for through, results to that great from it. the we've medical through of we with will we're equipment

and very being to equipment to sterilization in able such the forward look future. it we to produce as So, market near

Todd Felte

some other that’s you've quick with entities. the validate, great. and HHS the runs Army know And you and getting I SteraMist that test Okay, one U.S. technology had other government question. been

used any Army think government I forward? or any other the labs going in be or you're moving on of infectious even or Africa. contracts one update in either to HHS there the Is

Dr. Halden Shane

for moving enough the forward. moment. at they do They quick don't but me, are things Not

real are for getting We fentanyl working in life. on validation

a we'll fentanyl that it. potential neutralize up feel and to open able be of unfortunately I that, us get lot should the laboratory SteraMist, So, those verification for We're just waiting to areas. doors of to which again

Operator

from a do We John Private hear now Investor. Nelson, Instructions]. [Operator

John Nelson

to Halden, the I questions. Hi, forward company. have look future and on profitability the congratulations several of quarter,

on had was The contracts. questionnaire regarding government first one the Todd prior U.S. military

bit You mentioned Could neutralization. little a fentanyl, role about SteraMist more that? you in explain

Dr. Halden Shane

of for would I open the all with believe you the in laboratory that, of backpack product. come exposed schools and or which in fumes country. police up hear be when and neutralize should that high what's to classrooms to junior up it That get around of when high occurring the and able lot studies same Especially, we avenues on they space, lockers a toxic fentanyl enclosed unfortunately to come some news fentanyl. in they open problems a occurring they schools in in even when the the

be prove locker be this once on where So, would area located. suspicious we're utilized fentanyl product to a any that of could that might able scene be

John Nelson

the in release business System Also, EMS? for prior Technimount And press could Canada with describe any mentioned you in progress there?

Dr. Halden Shane

She let account. I'll about E.J.? seems to that. the E.J. handling be talk

E.J. Shane

Dr. Certainly, Shane. Yes.

SteraMist shows emergency to correspondence basis. of They active getting equipment to be came services. are are us their Technimount on they earlier on They trained the attending seem word units and trade this the and pass and moving warehousing in out onboarded between do So surface year fully in very weekly area. just and a and their and and

So, them year. I'm excited progress throughout to the see

John Nelson

Have sales far in or marketing they are it? they made so still the and of it kind rolling any of out just process

E.J. Shane

a come our marketing have gaining and little with so bringing they onboarding with current them It's out their more it. attended the they in we're marketplace. very of already, few, definitely the But partners unique getting and a customer on mainly interest an they're a shows full sold process customers. list and I've into rolling they're educated it of in how

John Nelson

thank Okay, you.

FDA treatment? on, X% was believe any progress it the produce Next question for is solution the with I

Dr. Halden Shane

last from further it, my discussion Nothing to John. about my knowledge, than

John Nelson

And is the think any it on was, have there I treating call, then there for penetrating last progress powdery mildew? another, markets was been marijuana

Dr. Halden Shane

you add to Yes, have I believe that color we any are to do that? doing E.J. that.

E.J. Shane

up it's the to Yes. the and this some the also end our, we brand with industry, actually really by through We're traction, but it's on attending a members move the Again, TSM a coming industry, awareness of should good our our who podcasts, so putting technology of results. with and familiar some forward year. of getting see are new results gaining

John Nelson

a SteraMist the And their any a mildew. for Has been industry be kind of of sidebar, fungus, large the treating valuable with has just powdery wineries? same whether the any Okay. vines problems of there might wine for exploration seeing

Dr. Halden Shane

after, might have once definitely of this direct a purchases. to I since mold a I feasibility, to feasible application they don't we do, to believe the vine, prior have that a we areas from eradicating industry to prior interesting to them planting, seed of go be lot we're continuing to seeds in to store pathogens from packaging a work the standpoint fermented to lot But and it's it of Even from see it's on sell retail specifically different know would with how stuff. stuff. a companies

So, are again, the applications you as for I mean, the know, endless product.

able depending go So, verticals to be research areas. we'll as up is, obviously and grow, these in much the we as can, do as the we more keep on company size of we as more upon, into

John. good Thank a you. question, that's So

John Nelson

also, on forever Okay, And the further updates study? thanks. shield any

Dr. Halden Shane

going knew ask to you I that.

So, think mention edit and to reading my earnings and I not their publish calls anymore, they're desire this. I it to it on it's delaying try because

So, further them, part will have, I there's of early but nothing the that with be I meeting in September.

John Nelson

out. SteraMist, in on partnerships word if get that's Vizient we'll these, two but big good. certainly my and exposure that in particular, motivated, the congrats because, more least are they're for it And Okay, the to needs at players Avantor get and questioning, those opinion, will on

Dr. Halden Shane

for you, Thank you, John. thank support. your And

John Nelson

You're welcome.

Operator

Okay.

reached for remarks. over would the to management floor of the any to I end closing our As have like we back session, question-and-answer turn

Dr. Halden Shane

joining for Thank can August you you once again, I get. enjoyable again. hope and remaining that the have everybody you Just thank

Operator

This disconnect does conference you for call, conclude today's Thank may time. lines your you and participation. your at this

TOMI Environmental Solutions (TOMZ) 11 Aug 232023 Q2 Earnings call transcript