TOMZ - Earnings call transcript Q3 2024 | TOMI Environmental Solutions, Inc.

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Operator

Good day, ladies and gentlemen, and welcome to the TOMI Environmental Solutions, Inc.

Third Quarter 2024 Financial Results Call. [Operator Instructions]. Please note, this conference is being recorded. I will now turn the conference over to your host, Roslyn Christian from IMS Investor Relations. yours. is floor the Ma'am,

Roslyn Christian

forward-looking The differ the no our of the at light is to from may statements conference relevant in date Board, will be looking Thank will company Dr. be Joe therefore time. TOMI sensitive our factors for the you, written this any note oral www.steramist.com. Please to recorded the X, Certain this On upon time us for available will October management press of advised XXXX. highlights. TOMI's of and for call E. by all statements is business accurate that TOMI's this to that Private results you after October J. XXXX. risk recent forward information these Shane; provided of contained which obligation XXXX, on are will call. These will based information replay. thank circumstances Environmental provide and A evaluated that release facts Solutions provide important Litigation of be may Q&A. could the future call XX, XXXX, which XX, you be and plans. the replay Reform longer Chairman TOMI at company's and the statements undertakes A available time available known Call. Joseph TOMI's joining Halden Investor constitute update TOMI's Shane; is COO, Securities telephone results. in materially of call financials presentation are report be Rzepka. within the or today CFO, November at of The in this defined the statements webcast website, the CEO of forward-looking as and made included J Dr. Shane Update cause actual today's dated also the overview and replay anticipated no E. Conference today's only information date details through in an will Act of could

A reconciliation In Dr. included about considered addition, measures turn The over measures to XX, information that XXXX. the release TOMI measures company they operating the should will useful October non-GAAP will discuss Chairman Halden non-GAAP this investors and these because during GAAP performance call. it of in go Please provide CEO, conjunction now measures comparable be Shane. ahead. is GAAP dated in uses financial by to the I believes measures. earnings with call TOMI's non-GAAP certain

Halden Shane

afternoon, direction Thank on results. reductions performance joining third TOMI me achieved executed margins overview, milestone, its potential. quarter growth our second This am higher making gross report year. by expense. XXXX company's for who you, everyone. will strategic pleased Solutions' another and financial us discuss With today profitable operating Roz, the XXXX COO, update Shane, calendar our I to the improved good E.J. and in detailed carefully and that revenue, reflects with TOMI our CFO, quarter Joseph for followed consecutive Rzepka, is Thank provide a today Environmental financial you to

expenditures. we of addition, control through our stronger tighter outgoing quarter, turnover receivable In and management disciplined flow by positive this achieved accounts driven of cash cash

team, the strength Our long-term the and our of momentum are achievements continues as partnerships. direct our base agreements a we commitment new our the business These resilience broaden and model. of and support our and of secure customer strategic of result partners

$XXX,XXX demand increase representing equipment, million, was performance quarter IHP has XXXX a revenues record the for approximately driven Our quarter of primarily the revenue the of $X.X $XXX,XXX, was mobile to compared for per which division's service XXXX quarterly XX% approximately approximately in XX% of making for third growth revenue, to a historical recognized strong prior by and year. increased quarter. our compared which the averages This surpassing our by

year. see sales this for international continue strong We to

of The growth by when sales XXXX sales year-to-date. first XX% X Solution shows also at XXXX. international months have XX% increased And compared BIT to

our leveraging combined effectively business opportunities. to partnership the continues EMAQ announced accelerate second in to and with quarter While resources strengths grow, and development expand

these and Pfizer equipment through The the support key and relationships are engagements to customers, clients on recurring sales such drive and to Integra service further third quarter delivered while across industry the LifeSciences, IHP's reinforces with in within Thermo presence integrations. in is new These including soon markets. We February sector. solutions, our new times of our nearing clients safety successfully ongoing acceptance sustained addition valued both food growth contracted the be The as and capital Fisher The custom remain Scientific, track other and extending onboarding smaller science contracts. California-based expected life will leadership operational. Curia advanced for multiple decontamination company

and Reckitt, is designed with TOMI phase. the multiple collaborations Additionally, in system to plc. has strides through is the Stermist's enabling industry Edgewell industries, as versatility accepted in laboratory Care highlight Group us Personal unlock manufacturing markets for services leader making care core new June the support leaders continuing the of the been advanced Benckiser such to segments. contracted and while These our across consumer into technology health now in market global partnerships significant

strengthened the organic we carefully international programs managing sustainable and ahead, I'll remain approach This forward. growth, delivering this turn now on committed performance new over growth Joe. remain to we has and profitability launching disciplined accelerating to moving quarter, products our call Looking and expenses. focused and

Joe Rzepka

of the financial Thank year you, Dr. of provide afternoon, period. third a results and everyone. same I'll for to Shane, prior good our the quarter compared XXXX overview brief

sales current attributable to the million gross The to profit representing $X,XXX period. attributable gross profit profit XX% of and higher compared The consolidated in equipment. our $XXX,XXX compared increase XX%. to of XXX%. and the was revenue operating mobile million compared loss $XXX,XXX, XX.X% in an consolidated sales a was profit to Our million, or Consolidated margin increase was was our mix year $X,XXX increased increasing our $X,XXX, product for net to demand approximately and

Our or $X.XX or a $XXX,XXX $X per net consolidated basic of loss share. was net profit of share and diluted loss compared a $XX,XXX basic to per

the balance sheet. to on Moving

As for was cash of approximately capital $X.X cash and was press shareholders' TOMI mentioned our Xth QX, was positive reduction equity our in flow cash XXXX, driven by million. million, and the equivalents were September revenue the efforts $XXX,XXX, XX, release. June $X.X cost working increased and

E. Now provide call I company to on insight to turn over activities. the current J.

Elissa Shane

everyone. afternoon, Thank you, good Joe, and

such As references. part resources towards of have and referrals activity on back generation show we reallocated scaled optimization, effective lead trade budget our as client strategies and more

of strong and general valuable engages effectively hybrid. attract builds decontamination outreach partners to building base. shows, both business enabled products. incorporate our and launched existing room and sectors, project networking This clean the on us domestic health to targeted a trade and like reputation While has prospects custom events into firms including upcoming focused AALAS bids the construction new customer their expand offer system mobile and companies we of clean manufacturers design campaign opportunity, rooms, prefabricated campaign for across our awareness engineered new care our construction Recently,

fresh customers as states, Organic, These Soli the iHP United organic of projects through the such in optimistic acceptance, and current contracts of ITH are the CES currently of new extending Kingdom beginning a Pharma various year year-end. and contracts national securing QX are in installations XXXX. about and stages at automated produce for expanding Our hybrid are on scheduled additional and with In with collaborating grower in parallel, leading manufacturing SteraMist QX additional we before on existing and and we CES are the hybrid systems.

technology provides While discussions are developments in still value customers. our to early stages, these the highlight iHP the

such As proposals, on waiting and lines strategies we and million remain focused projects current in build proactive mentioned contractors to on of Efforts for channel outreach and active close lines. contacts to designers reach our sustaining these estimated time are with continue product targeted the our with as in maintaining our $X momentum to pipeline. maturity, instrumental partner customer installation relationship decisions key and the

call, international continue growth the iHP of Shane which solid to this been we strong achievement both Service has of we a year on this today's Dr. year. as out As demonstrate revenues, and performance key close our Corporate highlighted

these include in amount Further, service iHP fulfilled and $X which we year have opportunities pipeline display exceeds sales of Our initial an not relationships, XXXX XXXX million, this with will restart and contracted cycle. the typically revenue our $XXX,XXX. does for currently shorter value

scheduled pipeline deployments early several remain track are on in to close for the some QX, While opportunities year-end. by

As a strategy. recently India, key announced, successfully into focus SteraMist growth entered TOMI's of

and technology We region. partner, will already have STS from be our end trials demonstrations building in the November with this pipeline and a via exhibiting our users Technocrat with new

solutions room deployments locations. Switzerland, needs growth into Pacific marks data full of SteraMist a the in the Fresniance. Brazil, in to We an a partnership awareness for SteraMist following trust over milestone This and the and global a In and location by also organization's a date specializing device and in environments. with we operations adopting our Fresenius This And their Asia centers. Portugal expanded integrated sciences reached they in clients sales room We life international in the meet iHP Kabi South new totaling that Europe. year-end, our to clean technology, company many firm of growing in and with controlled the of further with diverse successful for our to use million in continents. multiple to across other spans Americas, a implementations fourth SteraMist expect equipment business These continue Chile, across including reflect presence to $X ability facility fogging in be increase iHP international semiconductors, anticipate major among Africa. Africa core South

are partner a Korea partner emergency Additionally, South services. second to on in we a discussions in Australia, third in focused onboard early

and United Caribbean safety Rico for and industries. with food We in and validation the territory conversations in projects islands leading the equipment States pharmaceutical productivity the have neighboring distributor with also and working the Hungary are revised the of company occupational Puerto

collaboration rated $XXX,XXX. the we similar our amount. for devices, sciences, Integrated and of well successfully success. product available capabilities System, the and award manufacturer across We working valuable our standalone as combination and and the manufacturing receiving meet the our recently end by this but in applications optimistic product and with SIS, region full SteraBox, up now isolator highest SteraMist enclosure SIS is manufacturers is well, SIS gaining year. pending for The SISSA, have a four the new to with announced at market refurbished items. of specific proposals this Virginia standalone currently and aligns alone application size team offering. including product The in ongoing the of interest the to deployed end with customized and closely securing to the in National become user or order approximately and Malaysia the an The life As committed versatility of generated in is is may quarter, Italian line by delivery with commercial support next other budgets University, system long-time first of TOMI's about Institute SIS anticipate the a The standalone SteraBox our for of remain to technology. Forensic year line has Commonwealth a the Medicine deliver are partners We for to streamlined sale sensors material medical iHP needs sectors for sets also our traction. customer the it key which the the or strong

partnered and In our and The equipped to tailored sustainability. ensuring Pro designed and to response, market. health, in is various to highlight fully program during their SPC industry focus want support, ensure times awareness the players safety with SteraMist challenges Certified environmental disinfection and on contamination. of we and also proactively researchers decontamination prevent critical evolving to order certified services a needs to provide with food NCs affecting deliver currently we are or solutions public meet have We the

food to proactive new As shift, current by this decontamination the on-demand longer Together management now iHP, our and launched With sectors, in available to biohazard four everything maintain transformative we markets. with critical in from our health enhance continue partners across practices. we the and we border serves TSN SPC, care safety industries, and TOMI's key to experts, will Network of global with complex to drive control validation operations, along footprint. strategic part brand routine structure. room approach including customers and life all initiative reflects program care, of and contamination an TOMI industry This technology health commercial offer its a or educational cleaning SteraMist sciences, patient and control expertise relationships key Instead, Service and no have that supporting innovation our we clean harnessing platform. expand environments,

in broadening providers international for advancing our Our crucial worldwide this network a across iHP. and role list service impact plays of available diverse mission and markets a domestic of

position sustained turn expanded and call Dr. you, for Shane for product very X solutions closure. Thank to well divisions. all us Our and our offerings the scalable growth I of back everyone, across will over

Halden Shane

Thank BIT reflect And particular diversity you, growth as across to all platform. continues the our grow. Elissa good leverage we patented and quality internationally, strength Joe. all in driving products an operating businesses TOMI's that business opportunity drive mobile considerable of or service in-house performance our our driven our had with by are to We iHP products. see and the we and

of ahead, going positioned Looking we well next into phase remain growth and execute beyond. on XXXX our to

don't confidence thank and Tuesday. Good Environmental Operator, also want you I and As open everybody. the can luck TOMI to questions. innovate to go next in you continued to for TOMI continues world, your And safer support to forget Solutions. out call vote a for to

Operator

question Instructions] with Joshi coming [Operator from Our Wainwright. first H.C. is Sameer

Sameer Joshi

Joe land see congratulations here. just good good the the of on -- of business. overview cash Yes, bit really progress providing little and the Good the front. positive and And for that It positive was very net thanks a Yes. to income flow lay a diving on helpful. quarter.

long you you know On mentioned contracts this? starting What and But do what that you of in pipeline how us like do like of know is next the $XXX,XXX the have visibility like are? iHP have? from the -- these revenues, let see you recurring visibility can how year. just repeatability I you kind

Elissa Shane

Certainly.

solution knowing and will for that to $XXX,XXX build I on that the ones be X using facilities, installations that use. will easier our their lines. that model, systems. year. CES solution that we'll long-term then engineered is alone that real will our times it start production terms would projected custom next So and changer a is in be day in the waiting depend be that the Merck, And fresh will two so or of much to projecting that we've continue we now continue for latest at as say And some upon been that game become it that a

So change instance, in drug. for partner they use on will their system every new the production ICH time a

on on based the model, business that their So but that solution. is varies

Sameer Joshi

your repeatable the to is I think few during expected the we how quarters? Or line XXX at next is So grow bottom probably that this should and it? quarter over look

Elissa Shane

on service, that On absolutely. contracts we the That will reoccurring. continue to grow do

again, shutdowns was get the those we PR on did Now that, for XXX,XXX for I on twice-a-year ones contracted the for them. a required solution CES. to are the referring

So as maintains well. that

X got So you answers.

Sameer Joshi

repeatable higher to your this contracts, quarters. increase you is No, as few and to are Yes. installed base, you likely are good so speak, get higher kind because of the more next which over

Elissa Shane

Correct.

Sameer Joshi

that see to good efforts safety, that. food the your ongoing are On on

industry that do In see you for potential during in revenue say, during, terms developing how XXXX, of you?

Halden Shane

last What part? was the

Sameer Joshi

industry for XXXX as a for your qualitative far outlook maybe safety as like the food outlook products? in -- Just

Halden Shane

about we're engaging the safety food this network excited food forward. our a we for going move to professionals. product we're believe with University. market. this increase in a with conferences industry the And many including industry industry to and the huge continuing And ready-to-eat our organizations, is really as And industry. Purdue FDA at be I end, We're USDA, significant Yes. food There's the

quite increased it we've So a since XXXX. bit

is for comparison it the other it's lot, Sameer. very I XXX%, not also markets. was if but to our like But think as looks us, I in much bright right, as remember percentage which a

Sameer Joshi

in revenues get increase of to $X.X maybe this Should quarter. levels, sort quarter for to June we just then million already sequential fourth we the the the in from expect fourth level And back are near-term the quarter?

Halden Shane

$XX to we year. but should. over for I hoping hard tell, believe We're It's do the to million

Sameer Joshi

Okay.

came good. -- working is How terms around $XXX,XXX, then process? I that how that And questions accounts the are are it's saw rephrase, days Sounds do on from balance few terms let And the think The recovery AR looking I a $XXX,XXX hand? the just or of sheet. like nicely me it's what at you receivables, the in on capital. see in you

Halden Shane

Joe?

Joe Rzepka

XX The progress. majority the payments The as orders. equipment like projects regular for of custom-engineered our X customers systems are orders, net have

Sameer Joshi

Okay. does is inventory also, is And And mostly? include solution? last or it equipment levels, in one, this the progress? Or finished goods mostly work it

Joe Rzepka

mostly It's inventory. bit equipment and in solution

Sameer Joshi

And meaning that it is right? mostly finished goods,

Joe Rzepka

Yes.

Operator

a investor. next private Our coming question is who John from Nelson, is

John Nelson

progress results the And you've team, excellent congrats wonderful made the the over and again last on of couple that quarters.

Halden Shane

John. Thanks,

John Nelson

from kind the an about can what to sales? The to sales me as times -- Questions. give bit talking hardware lag you of we're idea solution

Halden Shane

question. that Joe ask I'll

I XX% which know, that far model sales, to solution our Joe, in our good I think you don't give do service. for increase as going some we've is the blade. razor-razor include had Hardware like little? on a want as sales forward color a

Joe Rzepka

up sales Solutions XX% year-over-year. was equipment reported were up and Food as Yes. mobile XX% we

John Nelson

Right.

I some get is sales? hardware use far the far resulting your in percentage amount as I percentage percent what in So calculations at as increases. Is solution X I'm Those there correlation sales? equipment sales my of x trying guess to should as increase as

Halden Shane

and that Yes, systems it's do sometimes and like integrate them their of functional to a take sell be hard piece a it to it into hardware, for year will we'll and because operational.

great. be would it mean, I So

have soon, of companies. something makes that the us at probably our it year, relationships that pharmaceutical bigger some in we'll next But And I think that, should moment, have will sense. to like KPI give a we

John Nelson

to have? increase products has opinion, potential market best details the that Okay. on product -- the the customers increasing how you specialty educate moving more awareness Any Great. And and the -- markets. on at on my least servicing the various in the TOMI you're

Halden Shane

When and you marketing vertical. or and any from industry moving in of in your markets. a forward it is in this be about available, the applied technology, think close bright to mean, just we're eyes it's so I application many relationship what standpoint, So almost can

a with a many relationship need it's at we're going to So the personally billion working want that. going the food And We're focusing And in large believe say, be the our we're terrific. that. to $XX for I market. processing for is We're we're on to doing market for It's, that. studies size working company, huge. $XX lower-hanging billion fruit. of advertising I to There's be it.

coming in using So start companies on some once studies the have good news that. really then these we'll and it, start larger

John Nelson

your Would for somebody and and useful the the be Okay. TreeHouse Foods product like suppliers McDonald's Boar's the Heads?

Halden Shane

new Yes. It there and a just reach I equipment And on, be. of out piece it and and/or need of reopen. to SteraMist social that's process out are lots or disinfect mean, going long -- go We've recalls many all them we going them I'm it's use it and working properly would. and to their down Yes, shut to through media are soon. realize wipe companies we're buy plants. to on -- for these they a go to would

hear response, many getting it's as as we process, we go federal involved doing them them. And service and news a we're organizations So try we're this with educate soon but as about and it. out to and

John Nelson

North there's areas applied? kind a Carolina And an just by would in I it Great. will what plant decontamination the the real-world SteraMist efforts Okay. hurricane. used was be as How would that damaged guess be of how example, or in IV

Halden Shane

that little to answer on I color EJ. think going have maybe. that a let I'm we E.J. because

Elissa Shane

our and before last in first We to reconstruction commission touch be get to to but services, do can damaged in using of kind Carolina. were step the hurricane them own some their We're will They come X the we due with on back in actually have North production. for plants into to us calling they are in. that

John Nelson

there's phase. know production I then GLP-X SteraMist? are an that number plants Is in that for that And Great. opportunity a working of towards Okay. huge that the you're

Halden Shane

sciences could hormone plants, to it's big another use it's a It use plants into our thing that we it's vertical and definitely type and production type life the product market, use of all could should in makes the complete be. another forward sense go these that product. phase Again, to and look and our ahead SteraMist. going It's

John Nelson

And trying media position on and and the issues? disinfection are Okay. TOMI social you other queue for using of then searches, on like the to top answers AI and things the Perplexity Google at

Halden Shane

EJ?

Elissa Shane

top lot even certainly social Yes, on absolutely. contamination work it of the media. and the blast. the we seen do recalls and on urgency platforms. mostly And is media and social We we've of to of it on of We a Google routinely on via date, our some SEO stay

John Nelson

on see. the sales in the And additional me you is transport transport? is can Good. have had color And you let's of provide Okay. the how being with it much of way received? Any a

Elissa Shane

into of line, on unit, So we the make production round of but incurs. option kind received we'd the too initial bit in a It that powering redesigner feedback, model terms of like product our we're that second it. transport to did a good sure sell there's a of and going third it

that we're that their we the in up future. near So still contracts distributors coming working for our tandem in see on Canadian with providing

John Nelson

guessing I'm surface and line system, the you some sales longer and wondered for which of a product have both the gotten like COVID website for disinfection. decontaminates on tuberculosis? you and and airborne And than with The Okay. your I safe that air cycle is items. other air which in now environment dealing any effective #X orders killer, diseases have if that's the

Halden Shane

against the is to the are if because it that don't There's diseases events everything. for serious I States, for states. I there this if the any have of And to their certain lot Midwest. it's Ebola-type a one will effective clients Yes. parts almost show different happening a and the that the of of starting real use product deadly United know It's preventiveness problem, in but more our specifically the use And protect problem, the in people We Malburg continue that. it's and think timing U.S. pathogens issue a -- surface. starting in that or time very to I mean, use some are if just all it

and very So throw question us, lot a everything. they that there's no against at effective can we're

John Nelson

Great.

or progress, but wanted progress an And check Okay. may certification. replacement not the oxide I kind if market ethylene on and there's of that any just area may to

Halden Shane

We reaching are would detail any us, that have used me there be but for it. know out on that that are ethylene discuss it to companies premature oxide to

John Nelson

Got it.

website on Okay. had developed interesting that's case has mold that an that, it's case Serro. study into significant forward and study. Soma, thinking partnership also does The that in earlier a an to the a significant? remediation anything relationship company? move manner you just to Or about with Has And possibly have the potential a

Halden Shane

Yes. people the I TSN, program much or I specific mean, is program companies, Pro the remediators. I all our which not include into certified naming believe mean, them. SPC old modified SteraMist of top being from larger will X a

product. will these only we that really and outside these their product. toolkit But disasters have forward, hurricanes they're our of ideal. mold all a yes, is with product product they the hand of It's residential, especially So know going a should most or structures, there see it's be apply tremendous great and whether in we in potential commercial

John Nelson

partnership use been I've a them would to wondering your of not be out was for And I let discount useful to number to order you're customers. figure Okay. to to able that if them name you it give in name. their then customers a able members and

Halden Shane

it. don't I more but press John, just spend us I do. some mean, with time safety want it And trying name big don't best. We out pharmaceutical to product, we don't that's food they using companies. we why the now, been our But name go we when and delivering have product, doing they when just work people, report the selling to to. like release we their through ultimately, want than the a start building get will and seeing companies do do I the of the they

will to So large, lot probably large a endorse companies, and want they get is a their them of product. This nature. Again, public don't just it better. are

John Nelson

cabinets. biological stand-alone am SIS for out And safety impressed that come with Okay. you've the this finally, I really

I going with would you be think How fabulous come a that's just to that? market. up

Halden Shane

Well, I'm E.J that. going let to answer

but demand, was it think I ahead. go

Elissa Shane

was other It absolutely demand. a for and there enclosures, It product but And all our correct. that that BSCs just are you system market we It across industries. launched. a is exciting is for very ideal is

with It's if device our does commercial going Stair medical our initiative system. the XXX(k) to more even be not it's than all. items. fogger, it our environment one for popular, end for with So applicator on great as Box It's it refurbished and

been it's and very does. it excited... making, everything So in does the it says We're it

Halden Shane

Operator?

Operator

my mute, I do was line Apologies, on apologize.

Halden Shane

think No, no that the Is it? question answered. problem. I

Operator

Yes.

We on time, the at sir. this questions have no further line

to I'll for have. you you any hand remarks over back it may So closing

Halden Shane

Thank you all.

great decontamination Thank Just once great a continuing be want disinfection for beautiful I to and and its evening, investors talking and products team again, shortly. our to and we'll long-term our work wherever high-tech you. a you our and thank for in the believe company are, have wonderful day

Operator

much, and you time, may disconnect this This lines conference, conclude at you so and your does and your for participation. thank gentlemen. ladies you Thank today's we

TOMI Environmental Solutions (TOMZ) 30 Oct 242024 Q3 Earnings call transcript