CSBR - Earnings call 2 2021 | Champions Oncology, Inc.

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Operator

Greetings, and welcome to Champions Oncology Second Quarter Fiscal Year 2021 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Ronnie Morris.

Ronnie Morris

Good afternoon.

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

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

dynamic on measures cause results factors to release. Overall, discussed the that financial on the may is to quarter and reconciliation XX-K. A GAAP measures could a very and available had is call several second XX-Q for million. to be Form successful Form that of earnings information significant differ Revenue we available on the Additional jumped accomplishments record our with $XX.X a in non-GAAP fronts. financial during quarter

will It drive coming tired continue over the Our not a we is expansion to our remained bookings record which levels, revenue quarters. at message repeating. get and do but repetitive of one robust, pipeline remains

exciting launch SaaS Champions, This significant for which quarter, proprietary our milestone Bioinformatics, the and was platform. Lumin a announced we of

to a leverage computational sets, Over have built programs. services. characterized these sets combined the through through biologists valuable for available to highly center To analytics the Lumin. team with development large years, strategically we these highly publicly to our oncology have in and of tools established visualization sets leverage data way that been other cancer practical for assembled Data and data effective discovery build scientists data we services bank tumors computational along personalized have of provide a personalized form a

its over increasing along and still extremely stage, the we're forward While coming its initial to capabilities in increasing quarters. Lumin response positive, launch customers early by with adoption been is looking the has

ex to revenue contribute platform. vivo to expand our our and continues to Turning growth. meaningfully It

vivo launching platform This our quarter, unique hematology vivo ex continued of a by offering. CLL the ex unique expansion we

The system of vivo use from assay provides a tumor autologous This centers a immune have is the in immuno-oncology value and of perform platform which immuno-oncology. that enhances of of patient, to We novel which autologous is greatly assay. the study our on announced it repeat the launch studies, uniqueness performed. the ability also same autologous ex the uncommon the

our them the relevant perform Our tools therapeutics. more to better customers with to and equip enable develop studies will platform

worked fiscal target tumor While we to work have to over are the past with we by year. the partners of on most our vivo year of bring in-house this perform end studies, ex solid this

unique Our to comprehensive well to a we platform ex meaningfully and ex vivo to as services will that and offer and be set received differentiated continues vivo revenue our of platform continue expand growth. our contribute

offering assays expand this we our biomarker and continue regulatory that flow quarter, signings booked cytometry we are remain quarters. recent over additional an studies specifically indication cautiously flow coming the optimistic cytometry, this these that Regarding regulatory to and will

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

investments As by additional quarter, is this services. to the and products these have evident led achievements

models. invest both over our fuel and anticipate spend point analysis our and customers additional of coming The characterization additional previously, PDX we stated end studies. we will in greater As models to as the usage we in valuable our data be quarters, continued on will

bookings foundation This the growth combination launched strengthens of including We our new an will offerings. quarters. the over our revenue we expanded quarter expanding be products to be enabling for our we for powerful software second summary, successful as bookings, work vibrant while will the on Additionally, performed. In running We cylinders. both all services strong tool platform investment enrich that on progress data and extremely a will the become to that coming strong revenue even platform, analytic are data had greater added anticipate software and continued we and a sustained had to customers. we

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

David Miller

Ronnie. Thanks,

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

Our period, a second year-over-year was quarter compared million robust XX%. of increase to in $X.X or ago revenue year a million $X.X the million record $XX.X

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

Our and cash including our $X,XXX. quarter, basis. focus comp GAAP will stock now resulting I on income for $XXX,XXX depreciation, noncash a in expenses, totaled on the of results

sales second were down quarter or XX%. to last the from a year, in the in the Cost year. gross last was XX% margin period compared $X.X $X.X $X.X increase Our XX%, million quarter same million million year-over-year of of

partnered our ex call, top on the continue service we expedite to to platform expansion As we've previous line of discussed our growth. vivo with to companies other specifically our offerings, drive

effect us accelerate have to customer sign short-term we is business, to incur and was revenue. and new revenue some have we these While these and This studies, cost demand, In continue our meet as mismatch between we upfront margin. rate growth costs initial enabled magnified studies. there partnerships upon the an signing an sacrificed

Additionally, costly this than in were perform our we work to it lab. if own more is

of of sales. for the expense placed increased margin. a cost on $X.X quarter, This recognized we a such in majority our of accounting For gross our of expenses, million total the downward increase pressure

our fourth plan work strategic to beginning is bring quarter. Our in-house this in

XX%. million XX%. was fourth expense marketing we was expenses as year, lift expand work million enhance data to increase and platform. Sales in and $X.X product offerings, marketing of or ahead fiscal year. R&D $XXX,XXX an as compensation-related $XXX,XXX to is of and to our sales do, a $XXX,XXX continue compared in the quarter the increase ago and sales our we The look deeper marketing due The expect development expense we mainly As increase invest continued including to characterization last our enhance to in period, due of or increase a $X.X to in compared to team efforts. we our expanding to TumorBank was our and an $X.X million year to margins see next

$X.X increased to year to expense G&A the million period. in $XXX,XXX compared Our ago

period and XXXX compared expense XX%, to leverage the at G&A the greater expenses quarters. In in of fiscal of were As for last we flat million $X.X year, and our $X.X of remained and increase million respectively. sales a coming $XXX,XXX total, and of the consisting $X.X in G&A, increase $X.X of quarter in million revenue, marketing cash-based million anticipate approximately approximately R&D, a in percentage our an cost same sales

Now the the We of to quarter excess $X.X last ended million year. turning same million a to cash. compared balance in with in $X.X period

operating from quarter, was net generated approximately the For cash $XXX,XXX. activities

be While growth strength and in over should capital generated lead working operations from bookings disbursements on anticipated cash a operations to timing in receipts directionally, our our an basis underlying to increase revenue in of coming our quarters. due from and there quarterly as factors such overall can the variability cash accounts,

we and summary, successful quarter. debt. In a Our We have balance in no financial it above hit a new $XX sheet coming very revenue strong, was quarterly million. record remains for

full to our in call. questions. the you of your we the depreciation, above a net profit anticipate of raising forward The to growth core feel promising, year-end mid-March. the to our open on additional to XX% provided we and now revenue We new XX% for comp progress XX% look strength stock coming guidance like updating our We had would quarters. Accordingly, our call on we in Excluding and comfortable year the $XXX,XXX. business look underlying to for and XX% products revenue

Operator

Our [Operator first with Hewitt question Matt from Instructions] Craig-Hallum. is

Matthew Hewitt

anything quarters bit details or some Any year. up. on signed then to have the coming over to as that those little expand expect start strong along you far database off, years? the how on first in a could as provide these metrics you seats Maybe customers or from platform, new initial of I'd do like on the dig bit you're the the that you maybe hearing And to provide what a can and lines? feedback of Lumin that little platform number Congratulations if offerings. of

Ronnie Morris

Yes.

We So users couple first summer last had the soft have dozen couple towards months. the all, launch date. end a of of the a just and of we of to

So launch. days early the far, it's for

lot to the these it. We worked and So use and and biologists from using tools conceived people the this do biologists enable feedback of the and getting a specific visualize analyze far, help to really this positive to we plus on that proprietary users feeling computational research, be seem we far, benefit to out to -- really our what so what to seeing the databases using seem of we're the both have set the do. public From we own we're data.

platform, there it In think forms. expansion -- the of I in X different terms of the goes

they continue would different The data, of like to ways first feedback what the see form the our getting to the upgrade to expansion the is more the from functionality. to platform or lot we about visualize users and continue platform. of different tools analytical a just of We're

and bank of data. just in adding continuously terms add We characterizing of is are the our second data working continuously own on We sources The data. itself. different

years, from we're So data the the the couple evolution to going that's perspective, the where platform. the think all we that next but we platform over enhance within see also enhance of

Matthew Hewitt

helpful. really sure feedback then of kind some And ex beta services the as I'm couple on those you launched those. well but more not on are when in a side. if the maybe market, a vivo those That's hit launch initial

Ronnie Morris

Yes.

both we and hematology, So have ex a vivo successful in platform. very vivo

hematology CLL this which -- the vivo sense unique launched platforms We launched is there there. aren't quarter, platform. CLL, the out -- expand ex many a to which that continue is We in we

studying that one is if ours So platforms anyone's of unique disease.

that also There out ex aren't In as well. very platforms terms vivo of there that's autologous many like platform, the unique.

on we products. next call about growth, couple of going to our rely the about we So think on continue for some platform as innovate, vivo of vivo is we're really we've excited really something ex the ex -- lot the ex many that going times, spoken other of We over platform. including we're and to vivo to years think this be our a

Matthew Hewitt

then the last flow cytometry. your And order quarter. great. Obviously, you That's got first gears shifting to

X a rate one was announcing gotten how talk as as from that seeing that you're far more. Maybe couple floodgates? to the additional that Is get thinking sign about big on first flow guess is kind just it be getting one you're cytometry your that of getting hurdle wins? Now And you've should it deal about the how And signed? customers of belt. a that cadence really just that we quarters ago. is for the now I opening

Ronnie Morris

Yes.

about getting expertise think as the this I offering. before, encouraged think we're seems of soon space and still to we So us quarters it's really preclinically. Definitely than thinking into some cytometry start space, be the to and in call areas because been anything's and well. about both we there this have good some the little bit the of We've thought. over some for traction. a couple last we bookings having got that We slower been excited and we're have a on be signings, -- think with changed a mentioned as clinical we've I histology other way don't I think

that perspective, from changed. think So anything's I don't

I I slowed I bit think our has I that COVID, us the the opening; the we think, a slowed think trials; and seeing. down so don't the down time, that Matt. but progress I floodgates encouraged slightly. But that by that's regarding see little of are terms in yet anything's perspective, what think think we changed from same don't at perspective, from we're

Matthew Hewitt

up. last lockdowns an spike maybe and if for then coming right. little increased All Florida maybe a seeing me, Where we more another are you the in are one seeing hospitals any? besides obviously, COVID, varies of country, you seeing And impact but and it one across cases, just on. we're utilization brought

Ronnie Morris

Yes.

like spike, concerned vaccine to diligent. end the at perspective, continue are to tunnel. the our minimal the the we're from about awaiting of else So COVID. be see we from But and everybody certainly and light continue the impact anxiously we We

very lab. within be We the very, careful continue to

So from perspective, changed. our nothing has

workers in very, this diligent be it an been many essential next had our wave, hasn't rear there But we're soon. we're a really mirror the or major But very hoping us, watching outbreak there diligent. been we're being any that and and this just We for thing and with even hasn't change with impact. will really being have We're of COVID. haven't problems carefully, more

Operator

And Capital. question our with Scott from comes ROTH Henry next

Scott Henry

Congratulations strong results. on the

Ronnie Morris

Thanks, Scott.

Scott Henry

questions. of couple I just a had

First, how sequential about growth think sequentially Would expect go? top quarters revenues, any comments you it to line we on the a quarter for should in QX and QX continuing -- fiscally?

David Miller

say the half the that growth, to think for say, I of over second fair it's half of year, sequential let's the see year. first the you'll So

of and of to that, specific that the you But taking so just percentages going direction. can overall, guidance, think not we our the we're quarter-over-quarter can growth, do increased half terms sequential year. In provide overall we of you second that exact the piece kind sequential expect for -- growth together I

Scott Henry

think think we numbers, don't flow giving it should to the specific -- I'm the we should segment. Bioinformatics, Lumin if trying magnitude just And Perfect. I how that about cytometry. relative perhaps And revenue how to understand the potential without of about know

around could that what Just long trying arms to the it and get my mean run. in

Ronnie Morris

Yes.

say, our experience it So early way we the we still think so I very on very based it's the but that of is Lumin, excited have. would users on. We're based Lumin. on, far We about that early Scott, we're excited think on

the and of weren't is question the our to really certainly transformative, good huge that that's there definitely product gives to to us by this used for for biologists primarily it's use be to do by system and no if the do potential be it a continue is that's to that niche and services know too early capacity able impact I capabilities research widely is platform Champions. something platform just use or trajectory otherwise. that's and used a many, interesting, biologists, have think a of the So if because be many has by and it this that it's to something people we ease computational so they that's more and and could it's is going many going companies lot in this But a the used of people still a

mention early I the Obviously, biologists. lot So Not it's biologists of be there's think lot about really and a the in biopharma impact. companies. of to biotech a to talking other

X, and see platform how the certainly who's you holds give or be And over So a insight it using time. that. into over up our year think to able I more we'll have lot to next we'll

Scott Henry

a would Is fact, Okay. it, Fair business. enough. higher margins than that be that, current in And now I business? would expect your high-margin significantly

Ronnie Morris

Yes.

Scott Henry

business. a It's high-margin

of you kind of that And may how of on disclose size XXXX blend in the guess in fiscal progress by cytometry just flow trying would you there. depend expect basket? can everything I would get segment? But Or sense to it we the revenue would else a into just Okay. and year it. you Just a monitor

Ronnie Morris

Yes.

to that, currently But we segments. know, you just as out. It's break our don't certainly currently So things we break have see will. you time, We don't as segments. over we different out, out how do possible that, know, different shake the

Scott Henry

is that it be take gross like sounds And a enough. margins, comes the be that state upfront half gross guess But the guess, diminishing really this maybe question, would would hit color Or I is start good margins I point, good, until would can be impact on a higher provide ticking All second and doesn't of great. would fiscal overall it expect I year would at margins the impacted mean hit. is at final right. a to when it gross you margins. of or event? business that Fair when any again? I Just get upfront really kind year business XXXX? some When you we'd imagine steady

David Miller

could Yes. the start as But lot benefit of be I the is see weigh work. think we're in some that the to that, seeing -- you fiscal not XXXX, pretty some think of and marginal we're to spike gross year the in this dependent to but towards able again, opposed certainly nice the second I outsourcing quarter. in outsourcing strategy busy, fourth work of there quarter have the margin. our that, really take -- our we're first do a so there impact half just I third a we Sure. our this just it quarter to -- think to And some of could actually will we in-house. If a upon No,

if a work you'll our a gross you'll to you'll but margin this margin. bring see If that longer, on impact bit in-house, we're able So takes quicker little still see it bit of little a see pressure. revenue, the

the trying we're to that's So balance strike. that

Operator

session. end remarks. the Ronnie the to Morris for And back of to reached And ladies have we over the question-and-answer I'd like and now call gentlemen, closing turn

Ronnie Morris

Thanks.

Lumin We've we're good services. launch to But we're very quarters. well as this we're over to continuing of of at made We're products a of forward the So the very, next couple our other very excited on about as call We the of about excited specifically update quarter. look feeling progress. as about and lot everybody where a some company.

Thank with So all for call, thank you. for that, I the and you forward you of couple joining we months. look us updating a in to

Operator

This concludes today's conference.

you for participation, a at You this and have lines Thank time. great may guys. your day, your disconnect

Champions Oncology (CSBR) 14 Dec 202021 Q2 Earnings call transcript