CDMO - Earnings call transcript Q1 2025

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Operator

Good day, and thank you for standing by. Welcome to the Avid Bioservices First Quarter Fiscal Year 2025 Financial Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to turn the conference over to your speaker for today. Tim, please go ahead.

Tim Brons

you. Thank thank us. and for you afternoon, joining Good On CEO; Officer; and we have and President and Nick Green, Dan Officer. Kwietniak, Chief today's Avid's call, Matt Commercial Hart, Chief Financial of we Avid business, Today, updates activities quarter for corporate financial on providing XXXX. ended be an July including Bioservices development XX, and will contract manufacturing results the and overview After our prepared remarks, we will welcome your questions.

update the today, certain begin, comments risks Securities Act made the and which conference today. of matters. within call I that any these forward-looking uncertainties. and Private all like could results contain encourage statements, you during assumptions, the number will to company differ company's Securities caution obligation and September of to I'd no and XXXX, Litigation the review Before of we the X, filings with from the these other or statement of undertakes XXXX. company, meaning the statements current Exchange made a Actual revise concerning this Commission Reform involves Concerning belief to

press release includes non-GAAP earnings of discussion information. certain a Our

earnings release, You our on press website, find including reconciliations relevant our can corporate non-GAAP avidbio.com.

I will Avid's and call over turn to President Nick Green, the CEO. that, With

Nicholas Green

solid everybody participating reporting what the I you, Tim, and 'XX quarter. are to be via a we first delighted a thank you from good webcast. can Building to Thank describe on quarter off today to momentum is fiscal X start, as and only

our business results. fiscal improve operations quarter continue financial will margins. the I are development build We Matt strong the and on overview 'XX following and an for additional signings encouraged by our and details of period provide to business first revenues our backlog new which and

to the that, call Dan. for And turn I'll over

Daniel Hart

Thank you, Nick.

issued addition with filed additional on release I to the on in to call in our which overview, financial the brief was this today today, XX-Q, provide Form our and our results details press included prior call the begin, financial are I'll in Before SEC.

$XX.X period Revenues an first quarter provide of from increase representing XXXX in financial to revenues first same and to period. for fiscal manufacturing the prior material was and the development gross quarter the period. now for during primarily and gross increase for Gross X% XX% revenues of revenues increases The used the fiscal expense. XX% of increase overview margin to other an lower our in million, million, XXXX, results fiscal prior ended first to benefit-related The the related increase expenses, increased operations compared XXXX. offset primarily process quarter quarter same customer a $XX.X compared by programs, driven attributed as expenses the first profit the XX, of million margin by XXXX compared I'll the the XX, in was of XXXX. $X.X recorded July partially million ended depreciation was $X.X or July quarter for were for profit and in in compensation gross year costs year facility,

compared benefit-related quarter same was increases XX% the audit, XXXX, XXXX and first of XXXX. period the to primarily an fiscal quarter of first recorded $X.X consulting for the expenses year compensation due July fees. first ended prior in compared to legal and XX, other in in of the for increase expenses fiscal $X.X to million, SG&A increase quarter SG&A million were in The

$X.XX and per share loss the $X.X basic was basic During per or first million a the XXXX. first or of net quarter $X.XX compared diluted share of company's quarter fiscal diluted loss $X.X net million the for XXXX, of and to fiscal

$X had adjusted an For million. of the quarter XXXX, fiscal company of first the EBITDA

XX, July XXXX. million million to April XX, on cash equivalents were compared and $XX.X on cash Our XXXX $XX.X

during Matt the to my turn commercial activities the now for update I'll quarter. concludes financial over call overview. on This an

Matthew Kwietniak

backlog and Thanks, fiscal was the new in company third the wins million. for high for the net project with highly new a and another XXXX. agreements quarter quarter the a are the highest backlog record Dan. team ended $XXX XXXX we since quarter $XX as QX net million of our productive The signed sets of

We composition these majority with are large signings significant addition customers, are as also a pleased projects pharma the with customer. new another the including of of

showcasing companies cycle with service, and throughout proud skill and previously, professionalism discussed our we've showed team Avid's of involved. As long generally the process. I'm quality they this is sales big very pharma in the and exceptional

exposure large our As we large build pharma our new reputation we over to for the on capitalize time. we clients, more deliver and pharma to increase expect

Our and the in first early both of successful during more have we quarter, new weighted late-stage, development Though programs. to bringing of also spectrum. signings were at late-stage ends programs towards in a continue we the good be mix

grow a PPQ As we've balance to the the as programs, with With our existing and newest earnings provide and programs between X revenues our respect discussed and on late-stage very of to well as prior calls, the mix programs. new late-stage we to pleased are early customers. longer-term report opportunity near-

III of a currently market. the product and advancing the on Phase commercialization approved which program towards commercially One is is the other

toward commercial the caution discussed we've in a PPQ journey we X- will future a only pre-commercialization that on and they capacity approval in the is a the the increase And manufacturer, we utilization as in that revenues, a particularly underestimate As attractive have of importance may we believe such requirement. potential now past, they while an the as margins. are drive growth campaign execution expect cannot ultimately, programs our subsequent and and PPQ our X-year are to beginning we of programs

of quarter. the quarter call for overview are concludes year looking fiscal now am pleased first to over achievements will operations the forward the performance great during with our and to XXXX, the In optimism. an balance of and update of conclusion, other I This turn with activities. back extremely we the Nick commercial on I my during

Nicholas Green

Matt. Thanks,

continue marks robust expansion continue a improving the of business our few last backlog facilities, infrastructure, time the of for a both business important attract company several to including of drive new achieved and investments revenues, wider we of capabilities margins. capacity and opportunities. quarter, the new the in and range strong During which to years The signings,

to Our better now look organization project excited have of diversification our and the same as We're the that provide and to are the past. customer of laid just with equipped forward has companies. infrastructure pharma excellence our support to to we out to agility and we we unfold needs base commercialization. large in from new early our biotech programs with stage And pipeline continued that story the continued key smaller

in Avid their all strategy. part thank I'd at executing And this Bioservices like for to colleagues my

is primary remaining ahead, focus our our Looking filling capacity. on

generating As stronger to continue to execute we and we and expect to growth backlog, and on sign strong achieve new going utilization Avid positioning capacity margins forward. our business revenues increase,

call This open concludes for my questions. can we prepared the for remarks Operator? now today, and

Operator

our moment question. first question be And from One the will Instructions] [Operator coming of for Markets. Dodge first Sean today Capital RBC

Sean Dodge

quarter. current Congratulations so we there this on contributors over shouldn't backlog, late-stage the different about early-stage what's affect makes including already On bookings X of similar to it that mentioned mix and call accelerate your there, the compare will is if the of stuff makeup commercial. stuff, backlog conversion, think customers, those lots really bookings, quarters? it Or decelerate of sense? I and new Matt progressing some this guess X strong these it, towards in so burn or to or backlog next, million the new $XX your if wins, backlog rate pretty then

Nicholas Green

going fact it we have to Sean, quarters. is got in dramatic phase going the it's I Yes, to proportion be than sense. the accelerating we've due than more prior have that clients to I make effect, think, a decelerating, does better it quarter of but don't a probably slightly the think early in just

As know, weren't watermark. quarters the prior you high the

I to a as think but -- there's So it nice balance nice signing. -- the of to was see to articulated a think Matt I see sort

accelerating, wouldn't but that it say was I worth notable regard. slightly in with being So

Sean Dodge

Okay. on X another be terms contribute those? kind annual you serving of share secondary in CDMO. what those detail the they something any mentioned ramped, more I a you you any as fully bookings to Are these And these you get in can Great. in roughly took of going you And then could won guess PPQ quarter. from can away campaigns are Or what on cases? then revenue? share supplier detailed things you

Nicholas Green

terms product manufacturer. We forward in too But Yes. future of where of much being the from is one forecasting terms a outsourced really from, came of them interestingly don't internal that is in revenues. go they actually commercial

approved, already quite which it's exciting. is So

it's a probably little market. I as than one say, already on that more regard most in So the advanced

else. somewhere III, and in, obviously, other is by it's fact II of the The virtue in CDMO coming it and that I Phase Phase been coming have in manufactured from another one

as so I aware. a degree. second And No far that's I'm of, to kind win as guess, some suppliers

Sean Dodge

Okay. Congratulations again. Got it.

Nicholas Green

Thanks very it. Appreciate Sean, much,

Operator

of Jacob our [Operator Instructions] next Johnson Stephens. from And be question will coming

Unknown Analyst

This is Mac Jacob. for on

a me. Just quick few questions for

how Just you noise large I months, I But there's pharma pruning been another large a addition from there strategy And strategy, some late? there. pharma in to around recent out as there's earlier-stage called some large guess as in given here. these pipelines know changes two, Is of questions pharma X on customers any your compared progressing your demand update expectations? is any internal

Nicholas Green

first, second them I'll changes answer question your as late. No from Mark.

that their getting wouldn't strategies of personally whether to us changed case. think have demand I your to their So issues the point than be seem or from

as strategy the whole, one long. strategies a of of that's terms it's in think I those

as has your cetera. There's And alluded audit lot Matt visits of establishing reputation, very involved. et to, a it's

for think we'd be I in general. where we're on like to track

some areas developed to accounts, some bit on are didn't I -- expect little think that like quicker necessarily moved accounts there we are to but quick. that a have as there develop are there we'd have other

patient we that being to assure is it that ourselves. would anything trying So faster you to though, be. we're I not rather be speed always not in could down want in individual, do however, it roughly the to whole, if than on though say I I'd line, can

Unknown Analyst

just the quickly side appreciate then of there. gene on I therapy And the cell things. color and

a early you last and the in seeing case? I of coming still bit terms in markets? quarter, those end phase is your comments, back biologics what was you mentioned think this traditional demand are behind Or this given

Nicholas Green

Yes.

be any think or I you is gene of at catch up the the to I is that case. think and continue certainly majority into that is the mammalian the the funding it. developing I but in that form driver or what cell flowing conversations the activity still I way, therapy the don't say of seen haven't nicely pretty sector in I yet. the shape wouldn't back in see do vast moment. any have

into conversations ahead anything hopefully, kind And conversations. we we in are but mammalian I up quarter. don't sure. X, we cell for orders, on last next some and at the can gene convert caught were from the or moment. interesting have where We start to think where So the that's of it's do quarter

Operator

And be our next of question Craig-Hallum will Matt Hewitt Capital coming Group. from

Matthew Hewitt

don't if or you're seeing know and hey, of vote I and what sign on to your Congratulations call the conversations be house But the possibly as going we're Maybe because I'm in act. on, curious coming quarter. Biosecure law, I'm to Act not up, say, are. were any I in strong customers the made that change that increase right your did we curious to just was happening but up. And potential it any But I first thoughts that always could tied hear. the this floor. apologize, just

Nicholas Green

compete the Chinese high from scratch ones say obviously that. and and get the I a think, there's numbers to a that we the try that we to in associated against and definition from basis. I of an Yes. through Matt, be of see element to to compete level, I day-to-day mean Asian China managed get competitors some that about are Biosecure that we've pipeline probably would half we we that competitor, of able in date, particular, very on regular marketplace

Some others Biosecure were won to or have that prior we've progress the of conversation them been any with that in already initiated. they

think with half that going the to that. up interesting. nothing to it's other want do How fairly builds I say safe be to So is

is elements definition fundamental there's in while I fees. about there's think no obviously concern the X ever that -- it,

decision-making. drive can that So

out do Although more might I and also of in absence can as past in that progress there's or we until also we in people who think the we the defined. do there's it's the feel law, can get

CDMO mean interesting going for say I with out. it's be So a U.S.-based to how are. see that bad to like pans we it's actually that thing it's difficult a capacity to

to certainly see So we'll out be how over term. that the pans interested near

Matthew Hewitt

second Got it. And then question.

period that. of safe quarter and seasonality, and given expect going But is that, through kind you and the maybe the that that's Regarding And as a is thinking the facilities the that that quarter currently last to big isn't am -- shutdown be right? the you witnessed some normal this obviously, shutdown cleaning it is years? equipment, we're all in of normally lighter of this the this few the Is year you year. seasonality I than newness just if that will case, deal about

Nicholas Green

general say that is mean, think wouldn't right I got in just way We've it what I off I would terms, at for looking year this facilities the got the new I online. be -- we've bat.

do like we do up and calibrations sure are We any certain facilities. make done. those to do need to still and So everything to maintain activities to things is all need still that date

scope reduce that think that few a So able we are the we term, in be we'll shutdown. things to, longer the of trying

that I you basis year in that much effect, mean. I building what know it's first be too on the new I But wouldn't the our if facilities, with to --

Operator

Thank question. you. next the moment One for

next Markets. from KeyBanc Our question Paul Knight coming of is Capital

Paul Knight

Hi spell cell you therapy how and -- of gene much in area? you were new maybe Nick, were the Matt out did orders the

Nicholas Green

Paul, certainly material it's scheme but not proportion, we one of break overall the things. out, Small that don't in

yet, So just nothing segment don't two but [indiscernible]. those we

Paul Knight

as company kind Do in funding. ballpark? said the of A think market therapy in you kind in that's on lag expect X-quarter of medium a the cell they the

Nicholas Green

quite I'm We've depends it's not go difficult at. far on sure look X I'd some to quarters. way pickup. It a seen -- as as

back for at of November I below. mammalian October, of I look end side, think low beginning I think the was if was November looking -- the

gone we're not for So X quarters.

some in from the that we November the cell I level side. in certainly, But think activity side, the I've pickup gene and And say we data. mammalian conflicting it's in seen terms getting of our some at I in of even therapy. mammalian are wouldn't the saw sort accelerating

seeing they think reduction Charles I were early the indicated phases. that a River has in

So I coming think it's through.

more we I think for what from the I'd be but optimistic we've seen, overall bellwether little know industry. probably a certainly

might going So X not think. as that's see we it I'm X to are somebody easy moment, the we and at as I else argue at X, but quarters, where or

Paul Knight

indicated year. the of extend similar sometimes I'm it is is project? And what still a kind now the that, you Nick, previously even seeing? Or had in But backlog duration terms beyond assuming of you've it to would case. the more that stretched that's of been

Nicholas Green

late crook at than I little this think think that No, that the richer in of last the of of mix beginning but traditionally. of Still a question last on higher I signings was phase early number was quarters kind we've of are we the phase proportion the the Sean's of that got a or quarter had majority in the them X than are there's higher X are we seen the early a year. phase, than

bit maybe So if less accelerating a little reducing to anything, it's but and slightly from it not it material. it's XX

it not were. So definite but as it's a would say I extending

Paul Knight

States, here a a front there's puts that know I new anything Biosecure regulatory lastly, in but in in you there Europe of then And bit on better is the the position? United

Nicholas Green

I may No. definitive in some similar the people that I heard haven't suggests might believing take seen that, they that's to rumblings anything actions that going Europe. be I the case. mean that

all U.S. here is we really, as in act the in the I can Biosecure today, far horizon So the as immediate see have

Operator

for Max question our next Smock the moment next one Thank and Blair. be coming will from you question. William And of

Max Smock

Matt's before still material of companies are and of on a it happens their the have here terms to term? differences moving bookings are large the reacting biotech China. Biosecure, it any and the to away most waiting early you're up customers here picking that ask near echo behavior see sounds to conversations, how of quarter. talking fair to you follow-up just bill to moving wanted say But about pharma like your first on Biosecure? already And kind comments away from is in changing you congrats committed China of in Start plays currently what some are how from are playing it the that on Sean's and react I of the small or regardless nice out question on to quarter in

Nicholas Green

Good Max. questions,

talking us, the more view of problem. the are me biased people in and suggests think obviously guess, then if China already Biosecure I of are a get, when and to to Avid we you're caused you've to I you talking because impact about it, coming that you that

call me, I to So move won't looking their hear even the on person voice. isn't so even who

we're total what thinking or that judge are So little is to of obviously, of -- bit a they pipeline one difficult moving. the seeing, always are customers, on moving is

I'm data would actually rely point. I much a not how as sure on So that

I with not say but But around increasing an number I think interest at I else that is be. getting pharma, one. would that seen they're Avid pharma to that of alternatives that of interest it rid think in all seen Avid looking is backups we've because Pharma at I the area. could easiest other looking be necessarily may emerging conversations or certainly Again, we've Big deal somebody big don't well more in

also, phase depends the what you're biotech on phase. that think I in it

there's region then you're view occurs, which in and phase, I in or get you that source a out think you before those case, then still could could in that people. from that if maybe early

more could outcome outcome In you becomes get the because obviously a have that the of whatever up regulatory concerning being. of caught later may in case a that the little the are phase, bit filing then ends

than attention industry. not the anybody that I I we larger hasten phase from would getting are out the what of later point we whole the probably concern bellwether the So else. candidates would to clinical see can more do be are I see probably think that But

microcosm that see. the So we it's

Max Smock

there. and to good trended in your us down unrelated Halozyme so X/X far But a up exactly in a lot about an obviously, revenues in following fiscal half fiscal or happened here Maybe enough key was that one. far stuff trended How Halozyme to of first just 'XX. XXXX? Can give Fair fiscal ask update about was in around you XXXX. what I revenue in wanted customer the quarter. on so over an which Yes.

XXXX what this revenue of overall in in level this fiscal got year revenue customer. visibility your just here from Halozyme you're You baking for and into key

Nicholas Green

know do form. in and it Yes. else's what particularly But any Again, on or way, public in shape environment any is somebody rather. between think ourselves business, try went on I of avoid obviously I I don't public a negative Halozyme. in to a commenting company

I So that is that strong. think say relationship can But is. I I one that as think the I'll leave what remains

that the positive think as see. on is far I over can I years what's few last as been going nothing but

possible supplier be can to best our we continue We standard we highest to the as and be other the that as that well possibly clients service can.

it I'd And revenues diversify business continue I've our publicly smaller past, said proportion of we customer and as to become remain in grow see grow, base. Halozyme much to our see same. to love a I'd the we love ourselves the continue the to and them pretty

think a with grow just that So along again, hope Halozyme. would we've think, it number years, in last the articulating. becoming I And continue last and that I year the smaller we of still is that's to the can we're been direction we were over growing out where to and is the compared what term, over take long I I that few

Max Smock

incremental margin the think margins modeling Yes. and you I adjusted on to the adjusted fiscal here jumping speaks here of a quarter give final kind us that a pointed again, terms something necessarily in EBITDA in about to me. I just XXXX? there. Maybe of any is good rate this revenue for XX% there's assuming point in to to can in color rest EBITDA of bad year one just not as it being thing, drop-through XX% perspective, about like the whether sneaking to a that base and a for customer And or expectations not the ask your from past? think rest you off Understood. right? for wanted reasonable of of And the strength or it

Daniel Hart

good of see of for seeing of that looking we where coming Max, last to off where QX increases was QX question. were It QX. built nice ended QX into and up we the we've and momentum off year,

margins to As to and continue the we far this margin year, the guide say, see through EBITDA as approach gross as down right I'd to as like continue we lumpy. EBITDA fall can of grow for to quarters But always be overall grow.

So continue have I'd to some and go minuses grow similar and But pluses something grow. we see to we like as forward. we as will

Operator

back Thank you. turn conclude And to next remarks. closing Q&A go session. Please to that does today's like over would call the I ahead.

Nicholas Green

and operator, on you, participating thank you call. Thank everyone to today's

the the progress thank during quarter, trust optimism. We their continue partnership, ahead are to recognize and with continued look our some we remainder who highly encouraged wish our their the fiscal success. to customers to first this and the by We and XXXX for of we drive support, exceptional for employees investors

for and of today participating for again you Bioservices. Avid your continued Thank support

Operator

This call. today's conference does conclude

disconnect. all may You

Avid Bioservices (CDMO) 9 Sep 242025 Q1 Earnings call transcript