CSBR - Earnings call 2 2024 | Champions Oncology, Inc.

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Operator

Greetings. Welcome to the Champions Oncology Second Quarter Fiscal Year 2024 Earnings Call. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to your host, Ronnie Morris, CEO.

You may begin.

Ronnie Morris

afternoon. Good CEO Morris, Champions of Ronnie Oncology. I'm

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

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

discussed Forms 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 on the our the reconciliation

as Overall, the our second we over quarter's continue been we've navigate results the of were some several quarters. mixed through highlighting past to challenges

results have than we were delivering. been financial weaker to Our accustomed

our positioned us core business However, were there that for future. in well several positive developments the have foundational

As and Champions markedly the discussed business our on approximately multiple ago, specifically year which the negative, in impacted sector headwinds X ultimately in we economic Oncology. customers environment, encountered fronts, turned we have past, our

R&D fewer studies As our and sales budgets longer encountered customers' signed. cycles we reduced, were

are the a revenue customers bookings cancel of part was or lower had propensity precursor The studies higher they the to Additionally, all the recently we net to decline signed. much currently have experiencing. resulting anticipated

towards I trends the results. identified tunnel as these remain revenue that trends, led optimistic of conversion at the Additionally, we external to reversing factors, the in operating a some light that conjunction made are slower on and pressure creating with we operational positive progress significant our end issues we further see have emerging. downward

greater and operations. internal restructuring changes with will improvement operational in receded key that lead to Cancellations the levels. back have in confident overall made historical hires have necessary We our we are efficiencies to some

year. and Our are fiscal continued bookings, half anticipating for we strong, long-term foundation are of are the this building second which acceleration for success fundamental the

our confident additional an profitability. in internal finally revenue a growth to to become expectations. As to quarters, quarterly we been platform, these our see with coming models and has revenue revenue Similarly, our our growth contributor ramps expectations, our long-term our the With This more lead specific has work clinical it that Ex a meaningful that as feeling Vivo have to more in services, Vivo area accordance we convert expand Ex to are but increasing the to we regard pipeline will coming we can adding offering, bookings. return increased higher uptick with bookings behind an lagged clinical up quarters. which to revenue over should initial our in continue biomarkers

are owned discovery regard lead programs With subsidiary, well lead stages to exhibiting our therapeutic Corellia, discovery our with programs our progressing development results. wholly X drug promising through

capital effort raise to continue in We and engaged investors our with be an to growth. actively support accelerate to

we a in Although our return we in and revenue given investment subsidiary. in revenue quarterly the to weakness are short profitability, reducing anticipate our growth recent some the term, the of

as expected. poised material us a In strong comprehensive bookings, trajectory. next for on continue back the was slowdown, anticipate improvements take team the targeted stellar We spend We do this hold short-term a on of reputation and we to stage have that platform, our growth. Despite robust a is and have in not effect quarter's reduction slowly our put will that will progress. summary, a performance anticipate the

profitability long that stronger revenue and term. confident the emerge will over are We we with

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

David Miller

Ronnie. Thanks,

filed on with the we December results full SEC on or Form XX. before Our XX-Q

XXXX. second the revenue of was Our $XX.X from a million, second quarter decline quarter of XX% fiscal

of half to lower specifically of cancellations QX and approximately loss for bookings On quarter XXXX. a second gradual year, was follow decline would the encountered GAAP the year. $X quarter quarters. believe will improvement million the the and in in the last over prior net led to of coming the basis, guiding our challenges prior the first been was low we've quarters, to As gain We lead several XXXX a the a $X,XXX customer revenue point a last over in compared

$X were comp Included noncash stock expenses approximately in totaling of and the $XXX,XXX. million loss depreciation

Excluding these $XXX,XXX an ago the million $X.X EBITDA noncash profit compared year our loss of items, adjusted was period. the to EBITDA quarter, in for approximately adjusted

compared supply in our year, a results. second to due was The to quarter year a our cash-based services lower revenue, the of XX%, gross was to was reduction a in XX% of quarter to same for the margin the sales year. focus the result cost million, to as same decline X%. the of million sales total lab of last decrease period cost compared in Turning our last decline line primarily relative period for top and $X.X last $X.X outsourced expenses. The the Despite of

quarters fixed of we our the expands, costs as against Our variable and a component at along improve our pace. margins coming the slower of cost to revenue leverage with begin increasing should cost sales over

expense ago $X.X compared in to period. R&D million, million the For was quarter, $X.X approximately the year

towards between spend core during R&D this discovery our supporting drug our split R&D drug our our business Approximately million platform. investing in $X.X traditional was quarter. discovery Our services is and invested efforts

sales flat the quarter, ago to $X.X million $X.X and year was in marketing period. relatively the million, a expense For compared

unchanged XXXX at Our XX, expense XXXX. $X.X also and million was for the quarters October G&A ended

the quarter sheet $X.X of Now balance cash ended the with turning cash. no million to debt. and We on

working a change from $XXX,XXX, from modest the in lab and $XXX,XXX, in revenue. generated from was equipment $XXX,XXX, from in cash exercises. in of activities activities new an financing resulting generated these approximately stock quarter, increase cash was course business. and was Investment approximately option collections ordinary the in accounts receivable deferred For uptick capital was operating The an primarily

next a fiscal cash towards generally a XXXX X next in year. end or remaining the position neutral acceleration the anticipate with into gradual We for quarter of and

results believe we directionally, to were our as improve, are sound. mostly cash As expected. financial expected position second our In information, quarter remains operational results our

was conversion is However, expectations. our This completion bookings timing to below uncertainty a study revenue on process. mostly due to in the bit revenue

second anticipation revenue despite revenue be last reacceleration fiscal of and the revising compared result, we As are half full generally year. XXXX, will guidance growth in flat the revenue a expect to year that our of

look bookings, steady report cancellations, short-term a update strength our but However, our slow in a of leading mid-March effect within in which revenue results. to our revenue and anticipate including next confident We long-term indicator third and We ultimately quarter operational are the in beginning with operational results, quarters. growth obstacles, take prospects improvement are made, reduction couple to forward continued next of with despite we we that our with the the when corrections our are the profitability positive. we

We will call now to questions. open the

Operator

Matt Craig-Hallum. from Hewitt [Operator Instructions] first The question with comes

Jack Christopher Siedow

Jack is on This Matt. for

then commented represented rate large so are you spoke And if well. a this prepared consistent the you we're hearing you industry delta? you're that's to quarter? And cancellations, cancellations in curious Were there far hearing? then what from of are As the to things as is or follow-up the cancellations have others elevated declining, X Or looking in that that your this remarks, broad-based? X how is I

Ronnie Morris

Yes.

couple it's with as just kind of much saw industry-wide cancellations. we from started X it X pretty a lot a exercise that So or necessarily I broad-based that of broad-based don't And would it a a now. blushing quarters see out customers. of say ago that's effect We

again, was question sorry, second second me Your remind your what, question.

Jack Christopher Siedow

things How if from in you're that industry this rate what hearing. are quarter, far declining. others we're curious looking of hearing are so that's the just cancellations the We're

Ronnie Morris

the we're ago. way seeing. I with we consistent totally come started down a a The what say year was yes, year it -- maybe back before. what to Yes, historical cancellations a our would over norms, it have little about call

way seeing get consistently cancellations strong We're gives which the short are remain profitability bookings seeing going So things and to in the to with that normal coming term. back optimism they were to that. back we growth down, and the we think us the are

Jack Christopher Siedow

And in you planning. hearing midst And will of do them my biotech business? a are your that then for and year? next of as What how lot for are a far companies think budget as you expectations from follow-up, impact pharma

Ronnie Morris

Yes.

So we're feelings. some mixed hearing

the companies, with the some I think budgets been a confident their we've that larger we're companies optimistic. opposed year. planning for lot biotech and them very of of about discussions in feel to pharmaceutical healthy, generally smaller we are Certainly, as next

still. able years holding holding really and cash as worried ago, to everyone on and it about going in as money. tightly. they're what bad budgets a to was where think back So don't were a we're ago bag mixed years I I think amount there the way of don't things I a year, X.X was do raise a where think where to it's knew biotech. was was But And it's to to be couple of tremendous investment nobody

way were. years So the I back couple were things don't ago. of a better think we're we're think I we than to

But there strategies. are certainly different

to more some the strategies focus on budgets our and into large smaller One than of the more who have R&D biotechs. I think of their visibility is pharma

Operator

[Operator Instructions] Okay.

turn no over have to We call I'd to closing questions the now like for queue. remarks. further back management in

Ronnie Morris

and drug to development everybody, the for with the to lines, last our continued endeavor. that all and also the information ago, clinical the Clearly We're looking that effort we call. we newer Vivo the a based us not carved subsidiary service years see growth. joining the including the lot but growth. not in We're We're over have we biomarkers generally you, terms something some platform. for us out quarter front about back about forward expected couple certainly that Certainly, excited had excited of Ex that expected of we Thank in quarterly of quarter quarter our getting of our a expected. we of on

everybody everybody, look come, a a Thank quarterly joining. couple of forward promising next on for news and of to our months. So you, lot updating in call Bye. to we

Operator

this This you for participation. at you concludes time. your lines today's Thank may conference, and your disconnect

Champions Oncology (CSBR) 12 Dec 232024 Q2 Earnings call transcript