CSBR - Earnings call transcript Q1 2020 | Champions Oncology, Inc.

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Operator

Please stand by. Good day, ladies and gentlemen, and welcome to your Champions Oncology First Quarter Fiscal Year 2020 Earnings Conference Call. All lines have been placed on a listen-only mode and the floor will be open for your questions and comments following the presentation. [Operator Instructions].

At this time, it is my pleasure to turn the floor over to the CEO Dr. Morris. Ronnie is floor yours. the Sir,

Ronnie Morris

afternoon. Good

Joining me Officer. call. our Financial David you is for earnings Miller, Thank quarterly joining Chief our today us on

I could differ be from that what today's remind in I materially and forward-looking those described statements. call results statements during Before we'll actual that is begin, will making you

discussed Form to financial that XX-K. A Form financial factors on to measures information available earnings and may cause results in call differ release. of XX-Q non-GAAP during is measures is Additional could available GAAP that be in the our the reconciliation

our I brief will start prepared provided results by comments just weeks we updates today pointing our relatively out ago. be company XXXX year-end that and will recently fiscal for as six

the While coming there last for and remain fundamental quarters was the strategies vision a the high since activity update, unchanged. level of

first Revenues of to period. by (sic) more million [XXXX] million X% XXXX in grew fiscal compared to the year-ago $X.X $X.X for than the quarter

a stock-based loss Excluding Champions compensation $XXX,XXX. of and depreciation, had

was looking remains high fluctuations the bookings confidence the our In at discussed but of past, below quarter, our we expectations, have trends. that increased because to in normal due mostly revenue

While with of and in accounting trend for continued regard we capabilities the there's way product changes to this quarter, the we the specifically, for new accrue investing expenses, commissions.

little Although be will which important to those my context expected, than company's focus a results view, long-term put of are it's worse them the in today. the

our Champions the results for quarterly coming While is revenue pursuit growth important, for story profitability years. the sustained and over are

for financial greater successes. future will We near-term quarterly results sacrifice

ultimately, numbers. the place This future profitability. us confident A to but and unfamiliar operational prospects as is expenses we and, our not were insight breakeven propel that our visible few we outpaced longer-term the our territory. always Our not investment justify in saw into quarterly revenue, in then would catalyst is in years ago, the

today. a in similar position are We

We in continue our strength services. to see core

over revenue will those are in an quarterly drive expenses increase the well outpacing year. and bookings bookings Our

As setting Last expanding we been on cytometry and us have on we discussing, our flow focused service to up GLT our enable have focused clinical offer services. offerings. we lab been year, to

quarter, and discussions have potential level promising. several to the and front deals is customers hope near active with announce We're the us. in During begun able aggressively we have future. in of be deal We a the current selling to in interest of

fiscal launched first vivo the We platform, evolve of to also ex continue have this which our year. part and expand will over

footprint product and to ex In our expanding addition international have monetizing to our data we bank. line, flow platform, clinical and vivo to adding an services exploring our plans continue

of to operationalize, Each to these contribute has potential but of opportunities the company. takes to long-term the time growth the meaningfully

As these provide opportunities will an update. materialize, we

The for and the revenue hope in the to our quarters demand message reinvest drive sustained growth. I opportunity the coming is is revenue will in will core higher offerings and additional which strong clear. to services support lead

raise to are in more focused to profitability, need where a growth we're fund a a than we going operations. eye situation we the capital While close cash put not revenue on keeping and we're ourselves on will long-term short-term

and be long-term should fluctuations prospects our Quarterly the viewed remain of context both. we in strategy confident in and

let for review results. Now, Miller detailed of the David call our more to turn a me financial over

David Miller

Thanks Ronnie.

be Our SEC filed Form results today. on will full XX-Q with the later

XXXX increase an for to on revenue last fiscal levels. decline was our million, $X.X in year. million of from $X.X expected was period revenue call, of the first the QX same compared to X.X% quarter discussed As QX year-end Total

of to recognized a we depreciation, a $XXX,XXX and gain loss compensation stock-based $XXX,XXX year-ago the of in Excluding compared period.

year. $X.XX of the Cost an to gross XX%. $XXX,XXX same of sales period first XX% was margin increase to or $X.XX compared for Our was compared quarter million last XX% million,

in was recognition process due expense advance The reduction of in expenses of and the associated gross margin studies and revenue. and our the bookings in increase to in higher

or to increase R&D an our compared $X.X the $X.X continued product year-ago $XXX,XXX of increase was period, and to million offering. is in The development due enhance work XX%. million expand expense to the

Sales $XXX,XXX or of and to year, was $XXX,XXX $XXX,XXX compared an expense last marketing XX%. increase

mainly The two increase in factors. sales and marketing due was to

First, we capitalize the for have force on services. growing expand continued to sales demand to our our opportunistically

expenses Second has is the fourth we achieved. in over accrue Historically, led quarters. commission. and our course treatment to were not until of we higher of targets This the waited as commissions sales sales did year marketing our

and sales fiscal contributes a to team are sales combined impact we have achieved, confident commission but the be expansion year-over-year the our begun evenly of expense $XXX,XXX. lead that we accrual commissions was goals approximately more XXXX, sales throughout quarter's increase. and year Since should will to accruing marketing distributed This also quarterly. it The

cash-based period first to total, our year, $X million expenses compared million for the same last of quarter In increase in XXXX were the $X.XXX of approximately million. fiscal $X.X an

accruing result to total. the started The bonuses year-end quarter. $XX,XXX QX treatment in in mitigate our for spike our expense but to the should Similar added QX, XXXX first commissions, another approximately we annual in of it

increase In investments, and $XXXXX in and sales $XXX,XXX cost summation, marketing, accrual. bonus $XXX,XXX sales, in a in of $XXX,XXX we had R&D in additional

as quarters. While there expect to over certainly profitability baseline. cash-based fluctuation, current coming be the the the expenses revenues quarter's grow, are believe a achieve will we And good we

fiscal on quarter, to cash the of first end sheet. $X.X balance we turning the million had cash. Now of At the

in activities investing For the was and for activities. operating period, net $XXX,XXX $XXX,XXX cash used

fund and was equipment services. we confident activities. strength, With for sufficient on revenue for our hand our operating growth remain flow that investment our cash anticipated primarily lab underlying bookings to The our is

message, In open our while our for the look to of and now business summary, the company. We very call strength update like would mid-December. Ronnie's your forward core underlying are in the long-term call to there confident we in prospects fluctuations, questions. next We quarterly can for be echoing

Operator

[Operator you. Thank Instructions].

from comes question Please Janney. state question. first of your Knight Our Paul

Casey Woodring

I revenue get to growth XX% guide year. that revenue guess, on back the XX% And, Hi, still to high-end actually Casey XX% few guys. a to the reiterating that just outsized see This is Paul. you maybe you half Are range, in that of we'd gave weeks ago? growth for the

your Thanks. what's that, on any? visibility if Just

Ronnie Morris

Thanks, Yes. Casey.

the that QX, So, our pipeline, because discussed, pushed of we a QX have for reason the might confident range we're of what's terms we The get the gave as the don't and into range. is the as visibility, our have into of good And we've into services. quarters, what bookings, I demand we year. into still short-term next visibility good fall in into going into think visibility QX about

to these of quarters because than easier I but to So, just the it's we from done that volume from a times, many for picking get to year hard it predict predict said see will couple now is know as it's studies perspective, a precisely. think us us when from I up, for now

Paul Knight

then, Got just more. And you. one maybe

salespeople. On it, the you you last call, said XX about, what that was had

any expect maybe? you XX do still And end year? get the If by the you quarter XX then, to added to to in of the

Ronnie Morris

Yes.

and going we're we we think as we're So, add continue also internationally. now to about expand to XX

I next think, probably the or XX get XX. over that So, one up or two we'll to quarters,

Paul Knight

Got you. Thanks, guys.

Ronnie Morris

Welcome.

Operator

Instructions]. [Operator

your of Matt Craig-Hallum. comes question question. state from next Hewitt Please Our

Lucas Baranowski

on This for Hewitt Lucas Yeah. Craig-Hallum. Baranowski is here at Matt

questions few a today. Just

signed still the First first it kind get there. off, sounds to you're on deal of like flow cytometry, your working

you could many maybe could us just think be you're first signed? about anything deal to tell So, you that customers how potential maybe when talking and

Ronnie Morris

Yeah.

the operational much be feel have our confident pretty us took these to services. whole able team to that the year very place. offer it to we right lab get We So, in

multiple talking one get the We to book and likely study should we're to in able be study. different place we within pharmaceutical we confident most we think, within to right – a quarter, going offer a have the we're able service, the operations – now able feel be actively to And be companies. to that to –

Lucas Baranowski

then, start Yeah. do study, And Thanks. book I would be guess work the customer? able that actually expect once quickly That's for a definitely to helpful. you to how you

David Miller

would So, it work to as quickly we've said really pretty for depending that start on study. we've the year work, times, the really But a from was the many now. come specific revenue so mentioned going we

they study, that the vary to are going by So, services on now we depending the provide.

year that be generally is company. we revenue, that potential by there could work the still our as some will that until the that it about But a pharma recognize year is guidance have but hit the patients getting fiscal XXXX. in starts you So, enrolled given it later of the are

Lucas Baranowski

Okay. very all you had. Thank That's much. I

Operator

Instructions]. [Operator

Our question from comes Pareto question. Please state your next George Ventures. Marema of

George Marema

Yeah. a on Hi, business? Can guys. you call. the ex Thank for the vivo little give taking color

Ronnie Morris

sure. Yeah,

heavy We a of or flow couple platform That to was vivo ago. platform the quarters our vivo of lift capabilities of we ex get think operational. differently the cytometry developing cytometry. labs clinical a do than now ex think to started flow the GLP we So,

of a more is The progress. ex platform vivo work-in

that We to have lot do differentiated types ex ex types And tumor certain to appropriate TumorBank. able not platforms. be of a vivo a platforms, are types different TumorBank of for we order vivo there's more large, there very want vivo but platforms. in ex And to are different well only screening. different But use of

is spheroids. a the types platform. There's of So, there's organoids, the XD screening. bunch different of There within whole assays

platform. we So, beginnings of out our the rolled have

and as we have the on ex complete call ex we maybe us our I revenue take describing a we vivo where that expanding have driver on the will timeline say a being a bit what term. complete longer have a a a major And long platform. platform we to working the about until for we think platform over team see previous were little a year, We vivo that

product product. to elements over to see, platform. the updates. different bookings platform, we and the So, right revenue elements doing And the are we're vivo as certainly our now, add ex we we'll vivo And we the recognizing with be giving for adding year, to are be we ex going

George Marema

is core going? business the how PDX And

Ronnie Morris

is nice comes and I and at most The business. the actually that business very of revenue a PDX our continue of grow our from very still say core the growth strong would core most PDX to we PDX business core rate.

George Marema

And a question. quick accounting

on made bonuses. So, how some commissions changes know you I handle and you accounting

now this total? due change the what accruals are So, the total that was for quarter in to

David Miller

$XXX,XXX. About

George Marema

in. All

Okay.

less didn’t it make would be $XXX,XXX So, this expenses quarter. you the if change,

Okay.

Okay. All thank right, guys. you.

Operator

for questions And there to this no further time. be remarks. back turn I over at closing to any appear now the management conference will

Ronnie Morris

future of to to I lot a very quarterly of But do reach excited what to able be on as for able our stretch wanted pharmaceutical for and expand excited joining the is for which Champions to be call. really the we're a interest Oncology. driving about us lot a and expand we're two, conference the you. profitability. us the building to just still for there's everybody this really road what the and three We to lighten There's up we remain demand putting and Thank bit doing of opportunity prospects. years little positive our down at blocks companies looking in about and thank

So, stay your updated you. tuned. appreciate today. We'll we time and keep everybody Thank

Operator

today's Thank your you. thank This for you participation. conclude teleconference. does We

time may and your lines a You have great at disconnect this day.

Champions Oncology (CSBR) 16 Sep 192020 Q1 Earnings call transcript