NOTV - Earnings call transcript Q3 2024

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Operator

Good day, everyone, and welcome to this Inotiv Third Quarter Earnings conference call. At this time, all participants are in a listen-only mode, but later, you will have the opportunity to ask questions during the question-and-answer session. [Operator Instructions] And it's now my pleasure to turn the floor over to Mr. Bob Yedid. Please go ahead, sir.

Robert Yedid

good conference and team. call and joining you Jim, quarterly today's with you, afternoon, thank everyone, for Thank Inotiv's management

we operating will to the like including the are begin, projected. that the represent statements, results Before of company's about some future considered to risks cause remind forward-looking actual could statements financial on make everyone expectations plans. management statements this and and call be that different today's uncertainties materially and date. Such statements statements are that Any from of as those or management's subject I'd achievements such to performance

information in of provide are effort investors. result You company new the or events Please undue company's filed does will reliance update on information, place is refer should company's in any comparable otherwise. Investors website, GAAP of company's certain been SEC to Commission. section the these reconciliations Management Exchange matter. to X-K undertake guidance available these also a and obligation financial further www.inotivco.com to not discuss statements, forward-looking filings non-GAAP the of the not in earnings this for and forward-looking to for the posted an or future also statements, and non-GAAP included which measures measures the the has Form most to additional release, with revise and the on Definition as Securities measures whether

to you company's Investors the you do If section a obtain going of release happen to the website. can press copy so by today's yet, of

Bob for will questions. financial John we'll of remarks, us the with a June this Bob summary With Beth Officer; President ended XXXX call Leasure, Officer, company's question-and-answer portion go And Beth and remarks, open turn pleasure the will Leasure, XX, Taylor, to of provide begin to then join are Executive XXXX. CEO. for third -- me quarter XXXX Joining Inotiv the Strategy today will opening it's Chief fiscal which Bob, my Officer; Financial for Chief from of after X and the results of the some please over the and call. months Sagartz, Bob those call ahead. Chief

Robert Leasure

good Bob, call afternoon our today. and everyone you, to joining Thank

CRO was Our our There accomplishments a call, since events quarter being very us productive for a announced third several goal settlement, related advance in which We're the we which and these critical These of towards marketplace. Inotiv. investigation reached you DOJ preclinical include, earlier. we to last were believe for our resolution the outline going will first, leading of some and we midsized of now. quarterly Virginia

company July with Second, the foreign the suppliers first or XXXX, its announcing investigating on that it the Attorney's for of was procurement District importation HPs that respect no we NHP Office XX, longer Florida to the informed U.S. time for company the practices. are the subsidiaries of Southern or from

acquiring European expenses. genetic in quarter-over-quarter which U.K. see quarter-over-quarter to up our our QX Sixth, NHP approximate compared exceed further now changes, our see seeing and reducing year-to-date globally. margin increase of as business believe we allowed currently biotherapeutic is of for processes our revenues 'XX. times those streamlined while the and our items U.K. business, these for these completed reduce through business, in toxicology Eighth, solid seek sales in fiscal -- growth we a of we costs lines, Tenth, foundation us financial we achieving and an our the notwithstanding, we non-compliance we we business, Discovery in closely sale our with XXXX improvements experiences offerings, Twelfth, -- exception continue in in include early our which to the including [ in with 'XX to reduction Year-over-year These increasing in DOJ a reduced If pricing are we listed backlog beginning waiver Fifth, Third, we announced and call. this recovery we and working Discovery purchase negotiations and optimizing has allowing the the general will revenue. feature start cost in better the and are June efficiencies, diversify for would increases pricing year-over-year have has NHP achieving administrative breeding come less our our XXXX. year-to-date and underway clients. to sales levels, starting and for the we are of line and settlement margin overcome. in we than our earnings it's marketing in Ninth, the business of we say contracts cost which them. increases amended along ] are signs loan potential the RMS All additional a and including received sales QX headwinds, pressures our And estimate The remain a recovery improved construction diet lines A our due boarding response debt faster compared with in NHPs assets and NHPs. sale. those volume NHP increase business watching end with of and year-over-year February deliver XXXX. we improvements the producing year sales biomarkers in NHPs, integrating year-to-date Seventh, senior newer positive calendar to and The QX assessment customer did of still with migration in price finalized is to should achieving of sale had double reoccurring And of NHP also and lastly, XX% for covenants was QX could DSA initiatives existing it base, of the expenses agreement XX, XX% XX% sold which acquiring further margins. and for with initially July related shift to Hillcrest them. of from and our implement along about those segment sold projects RMS as consolidation of holders to XXXX. which increase which our and we long-term transportation some further to we the would to and the revenue to of and we to U.K. revenues. impacted enhance expect XXXX. operations are of the down a in softness Fourth, of on organizational benefits, critical our and developing growth market, QX, sales we continue volume service down of to workforce our integration to of Eleventh, orders, further the key to a sold also orders. our service fiscal year-to-date I in fiscal we the declines service year-to-date of service in efforts. safety market in come the XXXX saw implemented the contracts, site

some have sell. HPs However, in higher we cost to inventory still

significantly over and QX HPs were same be higher-cost in these sales will down year-to-date compared NHP profits of roughly XXXX of approximately in within sell down down to in X margins XXXX versus Overall, fiscal EBITDA the the periods -- We million is QX for impacted as segment. NHP fiscal and and period. these for of will XXXX our XXXX. the -- the months period $XX million $XX our QX fiscal sell RMS first adjusted we roughly margins are the same year XXXX. is same

in projects being As financial some many of other being our and business improvements recognized the of completed. areas optimization are are

XXXX give the are of the DSA companies first seeing we market the half what the I'll some segment, funding In on levels have been in in for comments positive. Now improved calendar biotech today.

projects awards have award some by raised project We are seeing clients capital. -- that recently

However, important limited conservative pipeline projects. to companies to continue to the in the of we approach the term products expect use take preclinical capital biopharma to restrained prioritize in order the most a to short

XXXX, Discovery fiscal sales and pricing not the due pressures, and far margins. years and impacted So business have which Discovery Assessment we growth Safety in market in recent to related our the in have seen seen has weakness

focus Our take our and and to size continue and agility of delivery quality, service. goal on advantage is to

base We are existing attract still new a customer to young and customers gain its market share. company, which grow can with

fiscal XXXX NHP business. been year. Discovery price X pressures in ended by we We in the in inventories For net industry and have seen many are NHP decline orders orders Even and year's approximately last for DSA months our June depleting new last the both of customers believe have XX, running the with approximately X%. XXXX, early-stage of pace accumulated revenue they XX% ahead

last to our on-hand normalized now more on discussed levels. we've As their are levels inventory returning call,

from RMS with specifically, purchase demand as we date. and we the customers sales So the volatility increased business. segment, more expect in QX The year XXXX fiscal orders been for these ending business of this to of faced going see fiscal challenge forward most level significant has XXXX financially related current our to to of evidenced and margins our NHP

available industry faced the HPs heightened and charges be U.S. the concern NHPs overall the in development after uncertainty previously to volatility market together of on first in in and at have volatility late the customers the XXXX government U.S. Cambodian other among import which U.S. U.S. indicated NHP the and we discussed sales the through pricing further challenges preclinical demand regarding the and studies importation from could resulting to which conspiracy relates and the some and on NHPs the their discovery industry in it of into drove drug dynamics the charging into U.S. also HP office reflecting preclinical official of XXXX. a to to moving and as The discovery As This in past, illegally fiscal year this impacted access caused attorney's ban subsequent testing XXXX. the to higher We effects XXXX fiscal half to NHPs resulted HP by supply projects, alleged pipeline XXXX. permanently end choppy of develop the ability for ultimately the countries, Cambodian and in in resulted and

We do new continue for standards. and to as towards their in existing to owned immediate we we suppliers year, work This those suppliers, qualified inventory And and them closely purchases and will cannot potential and reducing NHP NHPs, rigorously customers seen sources work suppliers expand audit volatility. have we evaluate to more outsource aligning animal and health countries. Critically, we addition needs. not NHP this not welfare from and continue meet centers who with to their some multiple options our of evaluate to with multiple in continue reduce

consistency our reliability of for we will our RMS the we small solid supply and NHP quarter, long-term hopefully have last revenues. animal XXXX, service As be Within our the enter the and diets over business calendar globally we our in for and business. increasing business, Europe bedding in in and contracts starting non-NHP-RMS U.K. enjoyed demand restoring

call view of our strategic Before challenges to to years. like provide turning few how the the progressed the Beth, I'd recent over and last a operational review has broader of a over company

Over new have the added product dramatically and offerings, and we service years, business optimizing multiple and X past Inotiv integrating has grown acquired. also the while

levels. Our costs effort and out improving to improve service business take the of operating goals included the our facilities, company's optimize integrate while operations,

above, We years, over We CRO but diet. introduce believe significant research grow challenges as long-term and and the models for we has Inotiv competitive and to our obtain the the discussed existing to customers. past develop market our to position service to provider improved model some and new success. completed a faced customers X to unexpected also full-service grow as our have and investments of continue business ourselves we midsize adapt

have over consolidating our our expanding operations. We the existing improving X made while facilities years progress facility past and also and footprint in

and we efficiencies result, cost and operations. service to and a can As for shareholders. our create from value our committed lower We improved have business remain that building a seen employees customers,

to opportunities sheet a we in legal liquidity improve for recognize some headwinds, the efficiencies as we cost a XXXX, results In continue starting has our the ourselves evaluate positioning and we been full operating more We'll As the positive Beth, With who our negatively of not we and see summary, to date and potential challenges industry-related improve quarter. addressed to liquidity. of our to I'll impacted. recovery that, enhance are to dependent a call and synopsis be expect year results provide impact our to to on fiscal balance cash our flow. changes over have solely the turn market detailed will of achieved Inotiv's

Beth Taylor

everyone. afternoon, good Bob, you, Thank and

XXXX period, the and to primarily price For average the an year Discovery and in August compared Israeli sold in decrease third and of $XXX.X million decrease year approximate due to of number prior fiscal period. NHP sale NHPs XXXX Safety quarter million XX% total the a the $XXX.X compared quarter, a reduction of XX% the to during in in revenue was businesses Services the current The revenue. lower prior

conducted For X the for the the year toxicology $XX.X our in revenue connection quarter million services of months quarter the DSA in million $XX.X slightly were approximately the in period Rockville was new with down These period June revenues by analysis due in decrease third ended compared prior $XX.X decreased million $XXX.X were lines products ended a service mix orders August Discovery in revenue for driven the XX, sale the and a XXXX, facility. compared the the compared same third change partially by $XX.X year. the the consolidated sold year XX.X% due quarter in in the newer revenue in was X The when the to DSA a $XXX.X primarily was XXXX to net XXXX, million by XXXX NHPs prior versus general in last to decrease were in of increases XXXX. last XXXX third which quarter genetic DSA of Overall, toxicology DSA the of $XXX.X million, million. X% June months revenues quarter Israeli same this period compared to $XXX.X Services million, to our at XX, higher to year in studies impacts businesses of biotherapeutic to million. and decrease DSA offset and and revenue. decrease

For $XXX.X last XXXX, DSA first quarter conversion the QX months down a volumes compared And mainly fiscal result of million of prior X with year. booked XXXX, XX, third to the the revenue to pricing. due lower The they of the $XXX.X fiscal million for the related rate NHP consistent in were ended year-to-date XX% service $XXX.X million primarily this to fiscal million quarter $XX.X June product XX.X% orders same XXXX. net were the the period. in versus RMS the period less product new The and versus X as months the ending we XX, year was in for slightly quarter than prior XX% June year period was in and XXXX. revenue, same cancellations

businesses result In addition, there the was our a decrease in revenue of $X last sale million as Israeli of year. a of August in of

U.S., XXXX, revenue NHP was For the decrease a to and in $XXX.X year. the to increase result on in in the bedding was global offset compared XX.X% partially RMS of June last animal same X diet the services impact decreases revenue period the businesses million down months fiscal in negative primarily an remaining and to of lower lower The basis. $XXX.X sale of sales in sales primarily our to small million ended in decrease was Israeli of sales, as XX, RMS RMS a The due XXXX. volumes revenue by due

indicated QX in of Regarding XXXX that We QX fiscal XXXX NHP decrease pricing, of an come see period sequentially quarters XXXX. QX expected first down in the XXXX. down comparable XX% NHPs the on our was sales highs and prices to average conference approximate fiscal of price we the come of NHP average last roughly XX% we were fiscal X fiscal did from from This saw to of in XXXX. the call on

favorably margins early acquisition purchased in calendar anticipated margins. The and higher NHPs and we XXXX cost selling XXXX, expected year lower, realizing NHPs the future fiscal future current that are be for XXXX. are should late to costs we calendar contracts were in cost in lower As are of impact which

loss be As and per $XX.X for in depressed. the restructuring remediation losses, of our of expected on volume impact of on year's of or we operating or sale lower fiscal the to income to RMS in per work partially the DOJ in common These X diluted sales, compared of decreases Operating our to shareholders legal fiscal will and adjust quarter in agreement short severance, XXXX compared share. million third and quarter, income a fiscal was in an share of offset net costs, the items charge shareholders higher the attributable recorded primarily fiscal HPs and loss million continue cost of term to totaled related from million earnings common attributable third third last costs lower the the XXXX to through margins $X.XX the June net lower $X.X in $XX.X inventory, Israeli XXXX. sales million quarter NHP $X margins to additional settlement $X million in our quarter by estimate provision following that our of QX of a to due the fiscal XXXX loss $X.X was diluted these fees. margins to This third consolidated businesses. Consolidated credit third-party of were with

quarter, the compared last million of year's million For revenues adjusted third revenue XX.X% third X% of to was quarter. total less EBITDA $X.X for than $XX.X or total or

XXXX, compared the revenue of total million $X.X income year's million to Non-GAAP segment of revenue to For third our $XX.X $XX.X XX.X% total for of or was of XX.X% million DSA operating or $XX.X June X.X% last in EBITDA adjusted in of quarter. year quarter segment the revenues or segment third months X X.X% ended period was million the compared revenue. XX, or prior

operating we believe the will third for X.XX:X. As newly online The capacity, see begin was fully margin and DSA come services quarter we fill in ratio through we book-to-bill improvement our leverage. added new DSA to

slightly prior of to XXXX, June by or was was XX, income XX, the sale segment, million segment CSA was Interest the net sales Israeli XX-month with months was June year. charges, cancellations and costs, August from our of year. up $XXX.X million, than Year-to-date consistent non-GAAP severance our higher X.XX:X, favorable for in million third-party QX of last book-to-bill XXXX reductions at $X.X our rates. Our we backlog and decrease interest remediation to months and The year-to-date at versus quarter to businesses related DSA X The income costs. operating credit result expense And X-month the same segment RMS And the revenues $XX the of for a partially and in the expected to million cost for primarily million the last $XX.X XXXX. operating margins XX, In fees, were book-to-bill revenues of year-to-date XXXX XXXX, that $XX.X million of XX.X% compared net third the $XXX.X due third QX in less million XXXX in last X XX, period period. in quarter the year's fiscal impairment to period. offset June X.XX:X. XXXX third increased the new year of orders NHP lower decrease year's and in in a fiscal last trailing $XXX.X compared restructuring in our of prior in was losses provision legal in XXXX. XX% fiscal were non-GAAP was year million ended booked $XXX.X or quarter June in

to XX, by year. included million XX, XX months notes of $XX.X debt $XX.X cash operations as of provided trailing compared September $X.X as convertible in Net the June $XXX.X same balance million cost Total our the by $X.X operations was Cash XX, the to June was by million. in of XX, was at debt million of consistent $XXX.X on as June includes $XXX.X XXXX, XXXX. operations with $XX.X sheet XXXX. used the ended equivalents XXXX. June last provided for cash X million relatively million cash months period September XXXX, XX, for net as XXXX, of million This Our cash XX, issuance million, of compared and

the to During settlement included the the closed in cash used for XXXX, Cumberland in facility the the million we with quarter paid the June investigation DOJ that XXXX. related under XX, $X.X ending operations

we our or financial waiver Capital As covenants we in of expenditures XXXX, received quarter revenue. million agreement, our with XX, June however, from of X.X% the lenders. were not $X.X a third were compliance total in credit the under

X facility experience. laboratory client the compared or to $XX.X $XX For million June revenue XXXX. X.X% site year-to-date improvements improve the capital in capital X.X% enhancements improvements, of animal system as ended for enhancements to expansion, were months for and XXXX, million welfare total reflect expenditures or XX, The technology, to period the expenditures for investments

XXXX. terms plans, of our many optimization capital and initiatives mid-calendar of the completed In and pleased we I'm report in year started site that improvements to investments have

a We recovery expect quarters we and in these investments revenue. next will be the further reduced further in X see until

guidance. now withdrew guidance Let's fiscal quarter turn last our XXXX. for to We financial

market We provide overview, operator expect for our we demand. call greater clarity have guidance financial the once And the to over and to customer for XXXX we your fiscal turn will questions. on with that

Operator

Thank We'll first Craig-Hallum. Hewitt hear Matt you.[Operator Instructions] at from

Matthew Hewitt

there, obviously, the some signs situation is unpack guess, like up it curious, pretty sounds see down, NHP hear your great Maybe A that like in starting first legal the progress. I'm business. standpoint, drop regarding of to mean expenses expense resolved. that general, I that it's a One, fair? you're to goes from DOJ going And Florida lot to away? to that sounds And does dramatically. just goes it Is legal what but are

Robert Leasure

expenses. And yes, I see significantly hope we've Beth, so you begin reduce. would far want spent address legal in they to to what that, those

Beth Taylor

expenses particular to since, regards this some a but subpoena the incurring were obviously monitoring In of we situation. I received XXXX, June hadn't believe, in Yes. matter, we

see should expenses down a matters -- for and So probably about I $X for come to Cumberland quarter. the million by about legal million those matter, we $X expenses between that expenses legal the mean

Matthew Hewitt

what those years? in you on X spent much the over -- we last we that tell Can how cases

Beth Taylor

we it $XX legal yes, the On in of have to settlement, the approximately before lone Cumberland spent the years was the -- in million. case, inquiries closure address site, -- and the X the last

Matthew Hewitt

behind really Or you I'm some the the as starting see impact that that well to in that it have finally. recovery. just improving? to is to of see QX, of the And start sounds pricing you're triangulate that's like with signs it to Do to you that great reset expect we That's place, side signs trying really the on starts numbers? with cost on the as 'XX sales the contracts kind both side. the when

Robert Leasure

going QX. an We're in than We're potentially NHPs to in see, in XXX% we obviously, QX. going did to improvement QX sell more

a of QX probably As than sell we we'll fact, in think matter I -- potentially sell did year. XX% last more of

place those since So closer this sell all issues year, taking, quarter-over-quarter in believe of several we of late and have be all probably was, will the first we'll early before started The to taking last was bought end 'XX one in again, with the be in improvements for what the what started we our pricing I line and NHPs this XXXX period. it and seen last at margins, quarters. quarter most we before inventory QX in will have of higher 'XX. in out Cambodian cost now that right the some it

we've that into the to believe consistency then So of the we're the of bump to been And quarters. the from somewhat encouraging, in X seeing think start I in very see we we'll calendar QX But last start we'll is sell XXXX. contracts in more as I see where improve that -- in some margin much whiplash going almost a off XXXX.

an And encouraging so sign. that's probably

Matthew Hewitt

think bit of bit, some your talking pharma. holding and then of pharma a bit this more recently pharma facing -- programs little little clinical little on -- commentary was headwinds think small that given yesterday want you that of discuss a the necessarily only that you and earlier I But implying to they kind peers a the buyout stage. about you're to being focused even market? One you a seeing companies tight capital do And spoke and pharma seeing if sound medium-sized what reported or the raised. also small but It you're you're large some industry is not I regarding that of later-stage even like But the made. doesn't in of some versus little

Robert Leasure

DSA is Well, everybody sales, than I'll less in X% that large pharma. pharma into the remind our top to

So able developing built we've services sales that of some XX% market we taking differentiate still we're gaining still, and still some we is on to are share. our We think, of and been of we the biotech. service, are I XX%, that believe ourselves advantage

of smaller think, that, are the other in still the again, has offset help And to we in I comparing you're they us I some helped So public and has space, our just that, if companies are. opportunity, remember, than still think future. much

But And we're lose sure part, can focusing So grow I again, a in can we to. for more we good think most we're new also bit of for -- we think with make have We gain pricing $XXX with the still little the $XX what bit where pressure. accounts we sales. think so little in see seen the I accounts that by responded feel back in a it what DSA -- million, case, we're million that we we $XXX half in I a million move we yes, a But little that can on we million. do bit needle we have. position we've far, of year. have of and this to do And business. $XX We pretty a increase more case if lose that

see we'll what happens. So

Matthew Hewitt

environment. rather that Congratulations of progress on made tough the a here in you've some

Robert Leasure

Thank you. Yes.

a controlling year. our looking more debts next little bit So maybe to forward we're

Operator

Our Frank from [Operator next today Instructions] the comes of Takkinen line Capital Markets. question at Street Lake

Frank Takkinen

that And it that of is of starting bit touch how Is maybe it you customer reaching Or the about a inventory more? level? out? Can kind NHP to think a Good X months on starting to for that a you've do year Cox is it's normalcy of return. see out? you made? I hear Nelson kind know to hard kind is of quantify. the normal This But comments than kind you're still some to sooner end Frank. with on inventory

Robert Leasure

things of can they couple that of impact have -- a of flat. some that from as inventory these One internally. customers' their see the have many volumes level. are is and there is demand. you think Remember, I Well, are what are CROs CROs or down the are -- Two reporting our

both more POs So those sales year believe results good many good we've now, than I Right them back think in-house. more a as last came of Those got saw of bought than they I inquiry, lot they less amount had needed and things but HPs. expected. of

position. have And momentum current I visibility of pretty like I in little a we're I feel the think like right are very situation our the house. bit we're like we that X diversifying But three, have like to also base. our I competitor good contracts, a towards we customer being really is now, One, cautious. people our see more But what fact good in don't what and all we XXXX the POs I things. I like is.

our think base I of -- we we one had business. -- at customer XX our customer point, over had represented XX% one

we right of over that Is now, correct, don't I have XX% this sales. anybody think in our quarter, Beth?

Beth Taylor

correct. That's

Robert Leasure

little think bit. which customer our helping we've a job good a is done And really us base, so I diversifying of also

Frank Takkinen

you're bit Can And just fruits force the maybe so just see that made and you a far? sales the you've investments then one to the in quickly talk maybe more more. about starting from

Robert Leasure

also building a we into involved go really of again to And our building I this in gain our getting early-stage last and 'XX time talent that services, to And some that we Discovery scientific calendar the think not were year started sales stage did to and scientists early continue sales share. and we XXXX, about announced as last to really year, discovery process. end we through year, have market the try sale separate more add last the our force. we and out force to

people So ways it for overnight way that we're that there. our look But how of to hand think hire not ability with starting building operations. and grow and a so customer deliver. DSA we're great the and And our to market we customer and in making hand sure equipment some to continue the don't then we our goes fruits -- we that balance that provide customer capacity, the and What experience. Again, really see want as to acquire the base. that in we're can we of have this -- we is in do We've with happen in to our business, to doesn't add relationships. our line labor brick-and-mortar I a approach developing improve to

we've client comfortable, been systems to our go feel we metrics, our to grow. we deliver try then again, on, sure operations, experience, out our we So can that and and make focusing

And this of date, not showing year up decrease that the in in of lot to decrease is some that the So had of a I we've think because growth pricing. some the of passing or pricing, down, not due aggressive. lot by we're being the -- that we in cost, NHP costs obviously, a the those of way, past market the is because as on with NHP

but -- to still think have opportunity we So I grow. continue that the to

do can to we great seeing what group a have believe we of we team, I and great our look team, think a in XXXX. scientists, forward in

Operator

from the line next will come Jefferies. Our at Windley of question Dave today

David Windley

I on question the answer, the pick business. Frank's to Bob, NHP in want there your on up -- on

pricing your were impression do understood didn't down business to is price that through a at I were if -- was DSA the getting testing. DSA was I was saying to that, price. what coming under the the extent that what study NHP of lot compression you attributable you NHP I passes So think the the

NHP to So shifting? of supply of influencing -- maybe kind do us work? that sense stability your And your of NHP mix is you give ability and study that a is more improving

Robert Leasure

studies. We occupancy, very X years. or high maximizing has a X our NHP the level do safety for business for of occupancy us at that stayed And toxicology last assessment

in a seen we may of business once some -- good fairly Safety Assessment busy that -- HPs probably seen and about see our Every in we've for us. internal while, we're pricing. we fairly because own of use mix for of the revenue our use. a some difference we've consistent because NHP of XX% demand. very It's stay or But the historically So projects of

we we're and large Assessment the safety not Safety in that as business, near but business our are big So as competitors do assessment. in animal

David Windley

the might long-term cover? many contracts and that percentage give roughly your of, long-term of how you RMS contracts, a customers? On these engage say, revenue sense us What can

Robert Leasure

and they years. made It's anywhere going so some anywhere it's or -- these X And deposits. year boarding be X that and will probably be investments and we've of between to -- making involve

so nature. And term in longer are many them of

David Windley

this But then or base, XX think... NHP about you when customers in is contracts? are long-term are? willing your terms that of -- like XX Is customer And just thinking X into X that customers or to enter it these

Robert Leasure

but know -- It's aren't reoccurring I don't we -- X, out more have buyers that really and than XX there there.

our do a talking see dozen XX% we're portion would I long-term that range contracts. a in sales. dozen significant our think to we of up of I But a make sales committed of more the half think will

that market in We others long-term to give forward we're the over to past, reoccurring have will I've have in we but and look XX%, margin look we'll over revenue. XX% -- selling, will and probably have dollars for spot also the contracts said revenue. up sales consistent some that recurring

David Windley

total of is Not but for just that sales, XX% And right? clarity, NHP NHP RMS sales your sales?

Robert Leasure

is We're Dave. there that That's is.. goal, the That but not yet, correct.

David Windley

In some done of terms -- consolidation. cost structure, a bit you've quite site of

You've talked you for takeout? in of there other targets your Are and cost about potential quarters have transportation that in-housing for streamlining couple mind least that. efficiency transportation, a your at or

Robert Leasure

No, this point. at not

I too. sites cost of We lot investments we But XXXX. have changes to large need there, to We've major to since the money. been this us it on And get accomplished in focused that a order close make. optimize have sites, brick-and-mortar we and think made

any make next I'm them this you have million -- to I think a see to don't of quarter quarter fruition. ability are benefits some the still the and more those we that come coming that million where But tell to we -- we going $XX don't I have because improvement. of to out cost will $XX

David Windley

your you I 'XX, visibility. for normal the guidance assume interpret you'll visibility? FY call I Beth, which air be we actually get into time quotes could at FY it guidance quarter date 'XX. 'XX for provide greater would to that Or be further believe later in on as you 'XX? at fourth as about comments more FY have Are you your talked when said a in

Beth Taylor

try -- Well, some provide and early as focus can. guidance to as certainly will we we

NHP contracts where because So forward. some that's see really we'll going more guidance to have us provide are stable going we to primarily with the

can So to do if finalized. [indiscernible] -- to call, have as contracts just will we take certainly it that on quarterly our next are the we'll weekend,

Operator

at the Eric Coldwell next line hear We'll from Baird. of

Eric Coldwell

-- [ Or quarter was me not familiar it's I'm And I'm and bedding call I you the the ]. led last the recovery? then here. comparison that you growth was tech sorry, of this all with of and that or earlier the around an on have I But against a to so as last hoping a input off few in it the some guys remind of year? acceleration year? an really business not whether a easier diet Or quoted stabler is performance can

Robert Leasure

that. pricing volume we're are in and business growth in The seeing growth started growth consistent very with pretty X has in that seeing pleased And we and seeing diet we been ago. years our

we're we're great because a what new our we're customers, up the and better its we that doing the level quality -- in some capacity, job profitability, doing and transportation, So much probably we're and commodities higher because because of that because using gaining as that was much up we're a product. of some business a of seen doing segments, pretty buying look we're some better and significant picking turnaround in delivering a some of market it's at that share,

I know consistent the I business XXXX. growth since don't been we've the we've since think what involved in -- So that had

X.X ever So had the year down a But in only don't business years I've we've it. I been in think again, now.

Eric Coldwell

But a which I'm it to, your on maybe models, market items, research markets better give models we're the it no, your whether broader the some hoping which maybe mentioned share, we've learn of get were level, a faster a have there's I part peers. transport, after it. company digest of the demand? I you model of is to buying, how included bit think I certain there that about out diets opposed much sort was whether updates at no, some overall was in on to fronts. geographies, maybe certain tells you'd recently market. as of of models seen better us pricing more admit And sense the outperforming I standing better say, Bob, what these hard to you really global of maybe gaining seems number I'm animal us hoping and animal animal for not trying to to terms could from sure about that's growing a some

Robert Leasure

Well, animals. and that seeing is growth, what outpacing see in diet say we're animals what will I business outpacing I what we're you're in our believe, asking. I large small seeing

growth transportation of years. a growing. last So our our we job were doing our on our a to much are market with really and I and I at we're lot related we the look speed I things the we of delivery All of don't If lot up a -- is X seeing just picking share. improvements related, and think think percent in And think delivering. customer lot market a delivery. metrics metrics, customer all at the of looking those we're a we're complaints metrics, deliver time, service lot seeing quoting, because all look better we're --

I think think work. our we're customers I why that's more getting are pleased and

Eric Coldwell

And growth then all volume? sure level in But not transparency on any what of NHPs. recovery next number I'm heard you're providing couple of actual the here We've the are and of the demand you sharing on and quarters. numbers the

Robert Leasure

quarter, we again, volume. were was low. and our that volume can in terms down were another last we Beth, thought We've XX% price volume shared -- we which down of in down was volume, you this of -- tell our was quarter, actually never terms I from

Beth Taylor

Yes.

Robert Leasure

XXX%, that -- a more quarter up our even said, year XX%, terms XX% I think this we have quarter-over-quarter we ago. XXX% alone. as a seen that quarter quarter saw the than now or a that first that we could it increase in next would could while. quite is And we another think And from literally we But see be in volume volume -- of

volatility what we other what their that Are of seeing is and Well, market market need up maybe have in market share a that inventory. is can't -- out some we I of people what terms general is, customers And competitors macro? that inventories other because question think, two, some inventory picking your know of inventory. I we the Now some are is. one, the are see

those in we're and good us are Some seeing are we answer that the to nice know of to. with a I XXXX. good our questions. work response a don't increase, We seeing desire to But have

Operator

And to that or turn happy sir, remarks. is all the any Mr. closing I'm today. time we to additional have it back you, questions for for Leasure,

Robert Leasure

new to joining the the from industry, our our appreciate restructuring reiterating Yes. from of think integration, the ability reorganization, are us industry ourselves everyone, call get investments I Inotiv. position the a for today. who our where And they to and for providing I customer to you, contracts confidence and some the Thank address to go can close investigations. service economic today ourselves we've now challenges. flexible focused compare we certain where We're also but It's we ourselves from, critical in do government pleased attractive and have customers of high-touch, We'll here. detail to need conclusion of that we to come by our to future. really made the remain not is to want attention on to our provider, the personal as past future see continue building company

Thank better still customer to and to believe our business. are aspects service, time industry in for of day are very We're continue get you we every improve, to company continuing and delivery today. quality all and a days young ahead. related best our metrics Our in your our

Operator

teleconference, conclude gentlemen, participation. for today's you your does thank and this we Ladies and

disconnect lines. now your may You

Inotiv (NOTV) 8 Aug 242024 Q3 Earnings call transcript