CSBR - Earnings call transcript Q1 2021 | Champions Oncology, Inc.

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Operator

Greetings and welcome to Champions Oncology First Quarter Fiscal Year 2021 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now turn the conference over to our host, Dr. CEO Oncology. and President Morris, of Champions Ronnie Thank you.

may begin. You

Ronnie Morris

am Morris, afternoon. Champions Oncology. Good of Ronnie CEO I

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

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

the available XX-K. end in for earnings that financial of I Additional results available today results six is measures weeks XX-Q and cause may pointing factors that our to we by discussed non-GAAP is comments relatively in be could provided the as the company our information A brief, update will and be Form on that differ to Forms start call reconciliation will financial just measures during ago. prepared year release. XXXX our recently out GAAP fiscal

been fundamental unchanged. for the and to progress in in last million achieved a continued the record for period. Revenue coming the update, fiscal the $X.X ago quarter $X.X first successes XXXX While the million to of jumped strategies and quarters have compared vision year remain

to Our strong, remained and will further which bookings expansion. revenue continue pipeline drive

demands our completed our During the operations business growing lab risks took the been economic in Despite overall the The all space, business. in consolidating to work to-date, affected. and February to quarter, mitigate remain of effect. have uncertain The we continued under space pandemic increased of move measures to capacity the early us and minimally our COVID active we meet new environment, and our additional roof. one will enable

services. R&D robust point to for a As of now, demand continued budgets oncology and indications all our

several that services our unique many capitalized times last led as based our services has Recently, and to As to and data, on introduce we ex-vivo our bank we over on was growth the our our unique years. in-vivo have PDX bank in have platform well. mentioned before,

Our total to contribute rapidly to grow continues platform and meaningfully our ex-vivo revenue.

and our offering by in expand the As with unique comprehensive drug development discussed investing to offering previously, to for efforts. we experience Strategically, a the we have data, pharmaceutical look year. platform, to on our ex-vivo and this capitalize plan working companies in end fiscal of continue to ways are internal their

regulatory Regarding our in this biomarker quarter. cytometry we our assays flow and first cytometry, specific clinical booked flow study

mentioned on studies. we we signed year regulatory As our call, flow end have several validation

signing validation change prior for will the guidance study year. reminder, a I the initial flow fiscal signing full caution As that the of to the regulatory work. studies current often and these does step statement the at expectations not revenue is the

the cautiously an taken However, has these be and turned future indication the longer recent will this desired offering corner generate results optimistic that we has than with product's that the which in more signings expectations. line to initial expected are are our

front, to service invest continue our our and models. in R&D the enriching the On we contained offerings data and expanding

pharmaceutical Specifically, course fiscal for off models. overall, and look of data additional offerings. customers, the be valuable We our XXXX quarters. models summary, over additional we and the and believe we in year We year. over coming revenue a had analysis spend quarter. with to our over obtain The expanded the the fuel the studies. In additional foundation and our on strong progress lays strong to of sustained providing We to our to characterization expanding quarters, of first further services growth combination the kicked revenue usage while continue both will bookings, bookings endpoint continued updates we forward strong coming will anticipate PDX on

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

David Miller

Ronnie. Thanks

SEC on later we results XX-Q, full the with filed Form Our today.

compared to out million percentage Our period, record first the It due that a worth increase in was XX%. $X.X high $X.X quarter the results. revenue QX part or is year an in pointing million ago million the low $X.X relatively XXXX growth of revenue was to

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

including expenses results. I non-cash stock depreciation totaled Our the company on focus for our $XXX,XXX now will cash-based quarter.

Our first period, was $X.XX year. was quarter gross to year ago in million. compared XX% of remaining period an to compared of flat same $X.X Cost million sales million the margin last the increase $X.X

with business new year revenue. growth. an the companies you continue drive studies. mismatch our and expand partnered sign cost is revenue effect is to to upon initial This an As service call, between upfront end we offerings these we and our incur other there discussed magnified and and signing In we've studies, costs as

the expense negatively impacted For our of of a increase expenses sales, total million and for such a increased last $X.X of accounting the to we quarter, cluster recognized margins. year. compared majority This gross

the Looking except these revenue associated we with recognize of ahead quarters, studies. over as a few more improving we margins

of strategic pressure. longer of to margin some of lower Additionally, which expense work greater provide as term alleviating we in our our million R&D leverage, plan, ago continued $X.X XX%. part work and expand to of some the the offering. this or and due intend will in-house was bring to increase The compared an product development increase $XXX,XXX the enhance to year period, is $X.X million costs

invest marketing invest our and to team continue we sales our -- to efforts. expanding sales expanding in in We team continue

a year. $XXX,XXX As and our result, compared to marketing $X.XX to last sales $XXX,XXX increased million expense

consisting sales to in expenses for year-over-year the cash sales period of $X.X approximately at and million, revenue $X of respective a million $X.X Our a the million $X.X our last cost on in and million approximately $XXX,XXX same increase jump expenses were $X.X In quarters. $X.X year, million XXXX, quarter the R&D and base in of million respectively. flat total, first increase for of G&A marketing remain an of fiscal compared

$X.X million cash, year. $X.X in to Now, compared at million the first last the fiscal of we same balance turning of the period quarter, on end sheet to cash the had

$XXX,XXX. operating highlighted business, was For by our the operations from of reduction in us our With our activities was overall cash cash expenses working and and an of in the increase flow normal negative our booking from accounts fluctuations over -- due accounts to accrued in course $XXX,XXX, of anticipate capital quarter of that course a in cashed primarily The increase receivable underlying our in the strength, growth year. an balance our revenue anticipated we XXX,XXX. and the payables and

quarterly looks new to and promising and underlying $X.X core our $XXX,XXX. debt In strength growth have additional stock revenue in no a depreciation, The plans we profit quarters. summary, above capital. anticipate We no the for million coming coming exceeded record and new of we comp and excluding net hit our revenue in products business and raise

to next As guidance year. mid-December. update of XX% in such, to like revenue call our we now We leverage to XX% the question. the look our forward call open your We for for growth

Operator

mind a session. with comes be First Matt to of will We Capital Instructions] conducting Craig-Hallum Group. [Operator question-and-answer question now Hewitt

You may question. your with proceed

Matt Hewitt

Thank you and congratulations on the strong quarter.

Ronnie Morris

Thanks.

Matt Hewitt

the on these us thinking wins, so how with about the I timing timing First Maybe a be the bulk or front us then up revenues through you've a one just associated win quarters, the this tapers is little understand the should maybe and investment we when off the next walk over few flow recorded? cytometry couple off help talked or but typically will be was a of for cost it questions year about costs think versus multiple of -- bit? the historically when about congratulations. of wins? the lag, And

Ronnie Morris

Yes.

come we components offer to we So in are as lag running costs And so we study sure study recognize transfer and the that the two Matt; can [ph], a regulatory that's shape the so come And samples don't in. separate investment was or to a then and there's to the want the the And that that those make of primarily of assay until that's work. longer that clinical to SoW samples and do can work. that generally, of in -- incur we one we Once time we a over there get the be period revenue do just get validation they going trial. bulk the where the the is book we the really labs up services. the study and the --

Matt Hewitt

was And the end you will. the wins, an of flow if to cytometry heard think I S because you helpful. add -- that's Okay, I it

of So, was there validation, multiple and is one still Or the you're waiting wins on others? just in it the quarter?

Ronnie Morris

had had doing we So, in actual [ph] were others for the we one SoW the that trial some validations. culminated currently and

Matt Hewitt

gears little a you. very here. bit helpful. Okay, then And shifting Thank

sales that's last quarter, you of I people, does XX I emphasis Where you. today? know been head a think were sales come sit to XX for So, point your at

Ronnie Morris

quarters two we in that are salespeople. one range. expand the or of by next same We're but over looking a -- still the to couple What

within past, We we're mentioned again, think little geographies expand geographies as I well bit we've the looking both deeper. to have as go the our a and -- in as

looking geographies we we're both of to areas. activities increase within So, the do that amount have also development and business expand those

Matt Hewitt

you. disruption you Great. coronavirus normal me, into maybe and or still as but year. Obviously, you or an those back on I'll queue. getting general, and could is on are adjusting there one clinical And your -- update I such track. see the hop are of causing not guess, pretty provide this own some and and then those new last whether problems, Thank companies this trials back earlier in one of for the out was some if things significant The kind where to there

Ronnie Morris

Right.

we're preclinical So, of in business, the terms on track. I back think

as back two or was normal March, bit it companies. on I from would we're we there clinical a And clearly a last I I like the -- medicine of of a hit, to I we're When line slowdown of to clinical but have -- first I say clinical of -- calls, comes -- think things would to think clinical and in new one February the the say, bookings. some in trials a trials, the mentioned with a feel when one do pharmaceutical of cadence pause when game we preclinical think our the kind we two trials. been it pause perspective, our sight And good to enrollment. has little

of in still a -- some And terms a with we little think the things have a validation our the bit where with now excited early I we're don't studies returning sit, bit long work the doing. that but and conversations, what see beginning different it's things having seeing delay, And conversations about of I little hopefully We're of a our think of I we're be good going shifted work normal. from think to different to is, -- of delay. perspective, the we pretty we're about So, a we're clearly validation pipeline.

Matt Hewitt

Thank much. That's very great. you

Matt Hewitt

Welcome Matt.

Operator

question with ROTH comes Our next of from Henry Scott line the Capital.

may proceed with question. You your

Scott Henry

questions. couple A Thank you. results. Good afternoon. Very strong

press quarterly in record you gains think a leading year that revenue? in about First, release, mentioned for should the as the achieving indicator we sequential bookings, throughout

Scott Henry

actual Yes, we've in know, I I we've don't continuously think our to mentioned think trying see bookings, we think we're -- you before. Scott, I what But bookings. convey increase is as that we and that disclose our

we're And see And that's, I think it continue one think growth. bookings one what quarter is take another that after better to have the I continue to yeah, that's shows we -- So, we think have we that going where other. point I grow. home to after the

Scott Henry

the but Okay. the sequential Up, going stronger know would I to QX. be year-over-year, thinking growth stronger what expect QX is be growth QX, And than specifically, I numbers-- I should QX strong you there's more about as because well? guess, mean, than sequential I'm trajectory,

Ronnie Morris

this something think month we're working that these and systems. we've mentioned with we shift so. the that on when study a do, the will certainly type because work times that struggle with, this, calls, these times studies We've of whereas large biological is, many, we're we a that because think, I There I are -- of or are many

they the is we're with reason, take studies or engraft. well mice longer we're going to of a and mice, really doing for to the all wants the or to our working extend study pharmaceutical company want whatever So, time it, something, change

between next. sand the So, and quarter natural there's a of the one shifting

will harder quarters predict going member -- things out six roll or to a quarter-to-quarter. it are now now. into it's for when generally months how proximately, So, look at booking can But in couple us turn we of that from from we do exactly revenue bookings, to today,

bit. revenue So, a an can delayed study, to in-vivo sometimes that'll earlier. turn Go study be If little sometimes it's it it's a extra

higher still have yes, quarter we it's for going rule, growth. because quarter that higher general a and expecting we next think revenue. I we But single higher every So, why to mean to the revenue And we be as increased that's bookings. I say growth, too we're think every have have is guidance expect bookings to that early going quarter of the is

Scott Henry

on the revenue. release, becoming good for you doing talk thank a bigger think about how there same meaningful services, that that. Okay, to? more Could the Just highlight component is in picture, you're the business Shifting press customer and a know the a could of you base? you that about You And that grow a that ex-vivo trying segment? in color I you contributor meaningful little more. guess gears, word of big what contributor be? revenues to to How could of a specifically know,

Scott Henry

Yeah.

there. try So, questions remember different let to in Scott, me the all

higher time, Over now, a what we can our ex-vivo is would still have of put So, complete We say excited I over we only the it's climb business. about our certainly don't think we're even of foremost, end. platform ex-vivo our, and to percentage. first full to revenue. right certainly XX% going be still I'll it the in complement that

about over is at think over larger, broader very customers do array more and having we The look models. excited I can it about customers a in-vivo results and think what more it way ex-vivo this. then and targeted they could So, the pharmaceutical more for And play they allows role. of time, in seem hone work The the to a larger are screens work. then larger screening can

setting. using they they they've the extensive to in ex-vivo when actually the screened need an PBX So, that models do are work,

to excited even part of synergy -- We're a continue going our over larger lot think to see to of between or percentage vivo grow time, it. and in And a service about our vivo we lines. we larger and our continue ex be So, revenue. it's

Scott Henry

to we And margins, guess when improve fiscal that when expect that would Thank way? the great. question, half year decline, look is in the in as more I a of start XXXX? Okay, to continue at expect to see event? we Would the for gross XXXX then final you margins you meaningful a color. of revenues kind Or gross that second

David Miller

we will partners. means improving partners of And terms initially. a it in Again, increases outsource how we're second effect. our growing, a and of some more it we to think of continue but of will the these start in The it lot our so depend XXXX. -- half work work I to of much it also costs has compound signed that with some that upfront

at and expect of the downward will That So, improvement, impact half convert, still some I we do as does as more the more we'll but the more of this an impact see continue these to have have will pulling of on revenue second the same we year. direction margins, time, overall, studies. the something see but a -- opposite

Scott Henry

great. Okay, for Thank taking questions. you the

David Miller

Sure.

Ronnie Morris

Scott. Thanks

Operator

closing Ronnie session. gentlemen, today's would and Ladies Morris over question-and-answer floor Dr. Instructions] back for to I of the to [Operator we remarks. end like turn the reached have

Ronnie Morris

for I look to progress. in of QX everybody. everybody in We're call on forward call. our participating good And couple just Thank their Have a evening, want our next we to excited thank about you. months. updating a everybody

Operator

concludes today's conference. This

You time. a may disconnect lines you participation. your Thank your day. great at for Have this

Champions Oncology (CSBR) 14 Sep 202021 Q1 Earnings call transcript