BLFS - Earnings call transcript Q4 2017

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Operator

Good day ladies and gentlemen and welcome to the Q4 and Full Year 2017 BioLife Solutions Incorporated Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to introduce your host for today's conference, Chief Financial Officer, Mr. Greef. de Roderick begin. may Sir, you

Roderick de Greef

quarter and Thank you, joining to issued release thank three is of the Relations months afternoon, available for the everyone for we the summarizes our Earlier of Good for results the afternoon XXst, fourth page for us biolifesolutions.com. press results on call and a and full BioLife year operating XXXX. you financial this ended Daniel. website and Solutions review which December release our the XX This at XXXX. conference Investor

this broadcast days. through XX reminder, of the website. a the call on replay for link As is being and A available same live recorded webcast be will our

call, future uncertainties we statements cause statements make other to get forward-looking or company. of many and events risks will I and that Before to we remind this started, projections regarding future like subject to These the differ expectations. could would financial the are materially performance from results everyone during actual that

a on the affect and forward-looking to law. forward-looking filings and subject with the required any statements the public as and as projections only that Company refer obligation qualify discussion therefore, company’s statements uncertainties that other of of company For projections call, based date The to except to our as business I filed or you statements periodic the and SEC. by they factors are update this that risks these on detailed no are assumes of and forward-looking change statements speak are given.

CEO Rice, the like to turn of Mike I'd to Now, over BioLife. call

Mike Rice

and stronger sheet. report and for strong are cash the appreciate successfully year record positive year, the We year QX increased operating full key XXXX. throughout very your revenue, with and afternoon balance pleased Good for BioLife Rod. XXXX the a adoption, results areas Thanks and performance from interest executed product full flow closed We and operations financial everyone. continued to in

are we our secure in is growth progressed as XXXX of to trials well-positioned We approvals. strong off starting and report XXXX very product regulatory pleased customers more medicine clinical regenerative I'm for a continued through $X.X record our that X% and the forward with XXth QX sequential results. of at XX% XXXX. revenue consecutive our to fourth look sales quarter million growth and growth QX of XXXX quarter reporting over marked

more that clinical that growth we markets applications strategic X,XXX regenerative year cell companies, number Most full $X Sangamo, Asterias, of to over customers organizations. of in Today, customer that approved Cellerant, the Kolon, manufacturing X the I'll Bluebird, transplant was higher January of distributors medicine is WuXi. than over use listeners ApCeth, we at more biopreservation if customers new on segment these have segment annual For range scale, in XXXX market complete include TxCell, regenerative due CMOs XXXX. most in success Adaptimmune, than estimate health that products and Recall total revenue a they year direct trials. with more review we believe such cell therapy since revenue the This To-date, increase each source shipping of was collections the full hospital-based XX Immatics, Regen visibility CAR two media and in products the trials. customers, viability Phase manufactured proprietary regen revenue IOVANCE, this including strong med and storage Sotio, manufacturing proprietary an and embedded represents approved XX also XX XXXX. very Capricor, we likely a during products in to in growth clinical cell have T and of With been Kite, end centers, stem Caladrius, other reagents and comprised applications, material XXXX to XXX customer than Celyad, used revenue segment contract clinic. development regen our indication, media our XX% suppliers, clinical with of indirectly also users, our of remind Lonza, our is clinical gain record in important and so is biopreservation of reach. GamidaCell, new distributors, directly we channels. and clinical XXXX. full demonstrated through with maintain from getting or and products supplying med start our bulk are segment. Bellicum, a cell more don't growth to distributors. our medicine their our the the and than we have of network estimate I'll XX% with the the and million. Key distribute HemaCare, $XXX,XXX million half $XX [Indiscernible] XXXX, and starting would the ship international to as XXX and med And customers high the to XX% Hitachi,

injected freeze patient. every critical of remind customers customers. media received HypoThermosol and year. media and the also the used I In solution our should or profile marking is quality certification XXXX means to you passed customer successfully maintain ISO the approvals. to cells cases, numerous our CryoStor quality infused and regulatory many XXXX, products and that our This be we audits in Specifically, or into as the storage vehicle carrier are for safety two

XXX% Korea Kolon better where supporting XXXX could and over gene frozen a dose media. proprietary In have is see in Science we up customers year. for last and knee revenue Korean XXXX, sales was mediator that XXXX Each XX% INVOSSA cell in in approved The to growth osteoarthritis. to CryoStor therapy visibility continued Korea growth with freeze increased INVOSSA, distributors on of forecast first over last cell was we July Life a

conducted Yescarta now freeze of used Kite CryoStor enable media large U.S. was lymphoma. approved customer on B-cell of numerous with in storage is frozen last our continued by in expect XXXX, for file and CryoStor the also clinical cell XXXX proprietary at growth other being was Kite types Yescarta Yescarta revenue their as and Kite to them other The their certain clinical for to to more trials Each center five clinic. the FDA customer ramps two Gilead least In Pharma, clinical and trials expected are manufacturing October approvals. part regulatory customers and up. in top we partners. of by dose a progress is in distribution XXXX

would ATIRXXXcell in for of EMA ATIRXXXcell transplantation the publicly First, year. track in storage proprietary for European launch and stated marrow Kiadis in their cell bone have next Pharma which on uses second this QX make intended to HypoThermosol effective. approval obtain our safer They more conditional half they're media potentially to therapy allow year,

progresses U.S. early early you storage, engagements new The in the customers year. can cell Glycostem, early confirm [Indiscernible]. in year therapy we other Batu and they the capturing the [Indiscernible], candidates and and this they bring distribution more have of adoption been our XXXX, these as a cell half startups of of products stage Denali, new companies invested also to their enabling company to $X look We're new manufacturing, a approval publicly second Orchard, our development billion leading confidential is the to and We've customer successful that the stage updating CRISPR, file possible by processes. include end clinic. forward cell Over in Biologics, Car therapy space. for stated with customers could with segment T the in their customers in Notable approval and in was

City very Stanford, stating In therapies commercial customers, space realize including Anderson, the the which this Mayo med my influential UTI upstream used Hope, of NIH, in Health our regen it's commercial to limited note illustrates manufacturing Hutch, base, of wrap-up a marquee leading strong supply we're Fred competition, phenomenal with and cancer cell will that centers-of-excellence me cell we're at supplier UCSF, in to reagents by customers continue feed the continues centers sole and approvals summarize believe we addition pipeline. regen we and a proprietary Science growth to our comments Johns Hopkins, M.D. position med This grow. how gain of to a critical let development as corporate as opportunity To in Center. therapy customer to that also segment, a important in Dana-Farber, engaged the Clinic,

Fujifilm, Thermo by I'll throughput frozen screening high our in Fisher, induced discovery the include drug companies segment. technologies Lonza. drug Quidel, pharma Pinnacle pluripotent includes AbbVie using Labs our Dynamics of new adoption hepatocytes BioreclamationIVT, segment the Next, Hybrids of Research This Triangle Key cells Common and products review fresh the of by Diagnostic cell Transplant acquired by acquired market and LifeNet live Stemcentrx, of into compounds. leading Technologies, suppliers life of cardiomyocytes. types and and acquired division through Health, Cellular acquisition customers

total fresh use use In so segment biobanking to cell will banks, cell inventory they and drug PerkinElmer. surgeons. with high in revenue customers this StemCyte, screening. contingent on segment over XXXX adult growth is our cells XX% throughput non-transplantable include was private transplant with of market or in viable be Key customers Our products preservation stem survival in revenue Cord acquired suppliers XX% this hepatocytes case various the Blood isolated. critical and libbers XXXX. segment, In from over hepatocytes, was ViaCord these tissue biorepositories, AMAG, for the this total blood enable preserve of types, our availability by X% from which Ticeba in In functional and public application. Cell include Registry customers segment acquired our of This products of and are Care, of performance by XX% is cord yield growth banks, means improved the XXXX, revenue hair XXXX. banks, Cbr and the

domestic XXXX indirect our Turning sales year. strong distributors, lastly very was and international a banner of channel to

having revenue XXX customers In customer strong well of different part and our distributors Thermo grew XXX sales CryoStor about than research from in agreement channel STEMCELL that XX% very Technologies, a significant partners. Based MilliporeSigma, Merck. we over shipped This and to HypoThermosol is and Key the we partner. leverage to more now over of indirect expect include the our and Recently, done DC. and customers than performed our Vancouver, total OEM have clear marketing distributors announced X,XXX years five in different execution teams products a MilliporeSigma. Fisher, based our worldwide long-term great Our Their valued highly revenue the different Other sales largest cobranded driving more XXXX, we VWR, to in a include last forecast, distributors on of are products It's channel. distributor in and contributed with private growth XXXX. sales distributed they marketing continued customers. a has XXXX of adoption channel. and community. from this job STEMCELL company XX% our

full the I'll XXXX Now, year guidance back and turn over financial to Rod present for to highlights the XXXX. call and our our QX for

Roderick de Greef

Thanks Mike.

you of record XX% fourth biopreservation quarter media fourth the revenue mentioned, reached XXXX. of As increase representing over XXXX a for million, quarter a $X.X the

the of the combination lower due of from sold, For to than media lower channel higher compared to average for gross gross both previous cost med of XXXX, to volume it XX% of year of higher quarter. revenue of was The well due realized quarters million periods in per the in carries both primarily the channels. grew regen XXXX. was for The XXXX. a $X.X and gross sales in quarter with primarily which leaders in million, biopreservation $XX margin higher fourth XX.X% revenue was up in mix our XX.X% XXXX, of in The for indirect to XXXX, resulted from result a increase margin. which production direct goods was lower than the more quarter our that The our margin lower as full with a ASPs of indirect fourth revenue margin average quarter liter customers, as quarter fourth fourth than quarter's a

XXXX. XXXX, year gross quarter overall million the million to was XX.X% to compared $X.X the higher for period For fourth XXXX same $X the XXXX, margin both of sold in year-over-year liters of ASPs. reflecting increase in expenses in in compared totaled and the XX.X% full Operating

quarter change R&D charges fourth SAVSU venture our The of vacation to from the to of performance-based a one-time $XXX,XXX resulting and in in XXXX. restructuring and policy. primarily reductions compensation incentive and compared with sales the XXXX, of G&A increase our increase quarter offset by marketing For related fourth in expenses G&A to attributable the a non-recurring were was joint

for was XX% joint a decrease XXXX. from the expenses XXXX. of fourth million operating decrease the year was million, the of For the result XX% full quarter XXXX $X.X in loss fourth $XXX,XXX, quarter in primarily $X.X a of quarter XXXX, venture restructuring XXXX. in operating improvement of fourth totaled the which of our from The $XXX,XXX This SAVSU was

our operating improvement XXXX, XXXX compared which for loss of The $X.X year $X.XX net an per quarter with the for of the loss and A full $X.X the respectively $XXX,XXX shareholders year fourth XXXX share full of to to to for out million or loss quarter the $X.XX year of period was $XXX,XXX preferred compared compared XXXX. attributable was XXXX million loss represents fourth for that common and loss share, of $X.X the with redeemable million. $X.X net attributable or per point same $X.X calculation stock shareholders XX% was million per in attributable share $X.XX XXXX charge net dividends loss net stock. of payable operating The our the a common holder full For of $XXX,XXX of common XXXX. EPS or for I'd per the with the preferred Series shareholders a million $X.XX or to share and like includes in to

fourth continue dividend begin will for to the ratably this a of for We projected we income positive end the as compared EBITDA on permit. redeem it decrease the $XXX,XXX horizon was to net basis incur stock negative resources quarter going a with although to of forward, preferred four-year over this as XXXX. start at cash of the $XXX,XXX charge will fourth Adjusted XXXX to quarterly year quarter XX%

say XXXX. cash XXXX. fourth we a in generated period year operations $XXX,XXX full with proud XXXX $XXX,XXX to cash XXXX, from with in the million in of adjusted of compared positive $X.X by the For that quarter flow in We're EBITDA positive operations of the was compared $XXX,XXX same negative of used

XXXX, a of the from Primarily year facility flow result of of XXXX. in cash operations $X.X cash achieving year, in proceeds shares outstanding end For and a and with of for generated preferred and operations debt. A $X.X of in operations of and ended million into we balance positive XXXX used the at $X.X with of of compares $X cash converting cash a realizing balance Series $XXX,XXX XXXX full options by the exercise we from $X million from million as credit full positive million our This with debt warrants, million. cash the compared no

combined issued through resources we fund We XXXX positive With expect remains more generate are unchanged organic with in plan this than cash be our November of from company's confident flow existing XXXX, of and year. to early the January to the XXXX our that and regard beyond. again, cash what guidance will sufficient in it was operating to for XXXX, in

in XX% million, We of increase represents for $XX.X XXXX. million XXXX over expect revenue fall to which a to range $XX.X a XX% to

revenue. guidance will We continue One are start XXXX seeing strong and our year. a update comment to throughout other on to the

customers. year revenue in of like This timing while Given patterns safety stock it quarterly I positive highlight variability by the Said some a what increases quarterly differently, basis XXXX we throughout result would be on variability would some a quarterly revenue may see during sequential on year. greater certain the in customer is to year, basis, driven purchases possible and changes in anticipated year-over-year both we expect in in we ordering revenue negative that by at the this to compared the that may experience early XXXX. point

may to product gross previously in XX%. XXXX we our as year system. of $X.X a well of strategic quarter, of of the result objective our $X expansion between due previously and range, building for objective range strategic happened a this offsite gross of as operating As of than variability largely the when stated, as enhancing somewhat fluctuate above as inventory. Full timing an and higher full margin and continued margin year our XX% implementation to to we to XXXX stock channel the below quarterly XXXX and in On stated expenses safety the throughout management margin last expected mix million, XXXX, of stated million XXXX anticipate gross basis, range compared expected expect the quality are

we the profitability driven will achieve the GAAP year XXXX, by expect be full in We back results half will year. continue that which the operating likely of of operating to the for

Now, Mike. turn to over like back I'd to call the

Mike Rice

was In year growth. Thanks closing, BioLife Rod. for in XXXX again pivotal and a execution

leading your position critical growth our therapy supplier like proprietary of new and and the to of we for Solutions. to as BioLife long-term Our thank in reagents biopreservation shareholders and also cell support is We'd secure continue interest additional opportunities. used manufacturing analyze

Daniel? Now, take I'll to to the over turn operator questions. the your call

Operator

with [Operator Instructions] Knight Thank Janney Paul first comes question Montgomery. And from you. our

open. now Your line is

Paul Knight

my to more venture announced on is you type talk should about? recently we the Hi, And joint -- that? congratulations quarter. of like announcements Sigma-Aldrich what's Could that the expect

Mike Rice

Yes. Thanks question. Paul. Great

buying cobranded distributor, So, they last of with where we've several a we cobranded the OEM Sigma private BioLife growth we they're Paul, a an we formalized skew a more bit them. continued the been a And have give label label here of where relationship identity. are little in affixing announced their of to products, for meaningful brand the but agreement standard very years, CryoStor them but expect for more

something year other to announce for Forecast, while at do there interest we'd to be time, to are large this distributors may expect that. have this to. Nothing we potential a strong who be but and open certainly

Paul Knight

obviously, year. go at Thanks. growth this Are QX to business year QX was the full FDA the Can up? seeing wrapped than you more into your as rate more you higher of things customer activity wrapped talk point, the up; your tone this

Mike Rice

homes those strong. very community They don't. we and we're in we the there what channel good question the applications. be Paul, are QX of fine, from indirect in bullish cases, them that, end but the channel. finding demand some of really other phase great provide also that's Another of could to In both research was In potential more preclinical sales many feeling some products, visibility have was in for partnered the and we commercial the distributor users. support with the tech And and cases, the about to

Paul Knight

Thanks very much.

Mike Rice

Welcome.

Roderick de Greef

Thanks Paul.

Operator

Thank -- of not Group. questions question this the Jason Instructions] you. a with at Kolbert [Operator I'm from have And any do Maxim line we further showing

Your line open. now is

Michael Okunewitch

Okunewitch Kolbert. great Hi, you this Thank Jason my is on behalf quarter. the of on Again for taking Michael question. congratulations

Mike Rice

Thanks Michael.

Michael Okunewitch

this driver medicine exciting looking following has obviously, the wanted to are side towards regenerative the to growth in for quarter; indirect know key year? the just Or I be very sales? that expect if do distribution been you the more -- you in

Mike Rice

Yes, the years Michael. I'll regen reiterate question. Good a for and important, that most the and med the as the catalytic for strategic the base. out we that We've got thanks most growth driver is customer marquee year of segment sure. rest our see

We those many in those embedded have And products products. customers demand applications continue which of our will to approval, gain patient large many, should all for our drive have populations.

Michael Okunewitch

very Thank All right. you much.

Mike Rice

you. Thank

Operator

[Operator you. Private we And the Jensen Investor. do from question Thank Instructions] [ph], line have of a Rory

is now open. line Your

Unidentified Analyst

on Good final job guys. for and Hey the quarter XXXX.

Mike Rice

Rory. Thanks

Roderick de Greef

Rory. you, Thank

Unidentified Analyst

Excellent. to a got I going are question, corporate about making going talking Rod, these is plan that the -- change -- So, [Indiscernible], at you we are all structure Can new forward? me does you tax any okay? hear your tax does numbers,

Roderick de Greef

from XX%. say next number certainly, we the it's we to But think to to rate three for years the built already of we're for many difficult XX% a next tax clearly, perspective, NOLS up. from exactly that going and would we to have I how benefit five, being years, able would reach going but anticipate use to from profitability the that the I Well, reduced as say

issues the years. really of So, any we for next number don't tax anticipate

Unidentified Analyst

got we've acquisitions finding you to and Excellent. and being there the out didn't Okay. you doors customers up up, avenues in CMOs the the recent the our fingers that all -- and your customer of with and before? have And opening gobbled demand now these to new customers are

Mike Rice

regen particularly our strategic med good that of activities are pretty of reach, in need good perfect, tissue we it's army participants, can therapy segment not realize more to have I would pretty so and and say, we of we the have thousands we an market leverage with and but direct like it's and sellers. reach. and the think Rory There CMOs that engineering. to it's cell to thousands the I hire distributors, not

the channels in focused trying are catching that's we optimize very Not getting So, on and really with the funnel spinoffs, the with very It's all that technologies companies, But working, success. projects. but important products yields to nevertheless, think all process, have executing, the it's reinforce It's why to we it, the over remarks stage which CMO early so names commercial now but the reduce mentioned think right potential working to smaller to will they the do the us, that pull-through all and we're I support we're I customers. drive that. early strategy on plans new team what go-to-market help direct fill for exposed now ordering that right. make indirect multiple to we're the call our really them to right and can cost how and my dev during very many we're so and startups to and

Roderick de Greef

Rory space, viewing demonstrates Car really the T, of bodes opportunity which that referred really companies the BioLife forward, solid also. well large think as regen obviously I going I that a add really some for med in strong buy-outs that to, validation recent you particular, would

Unidentified Analyst

I Very that. okay. with agree Okay, good.

So, and I good job look guys. XXXX. to Thanks forward

Mike Rice

you, Thank Rory.

Roderick de Greef

thank you. right, All

Unidentified Analyst

Sure.

Operator

have Knight from do question Montgomery. you. follow-up a Instructions] we Thank Janney And [Operator with Paul

Your line is now open.

Paul Knight

profitability at terms some mind where you of on are or thought you're, your you XXXX at when Rod, ETF what's kind cash, growing in lost Hey of, the XX%-plus? some showing burning for guys process -- of

Roderick de Greef

to have $XXX,XXX-plus. position XXXX fortunate and the of back really generated cash full a which of was half the actually in in particularly, about year, year in we're Well, the

into actually So, that move that bigger. will number see to get we XXXX continue we as

be a XXXX. general, flow operations a cash based but from anticipate, actually quarter during we perspective, cash. we expect on do don't in solid just There or from that we burning So, variability, cash any may two additional

basis. expect also GAAP for year profit a operating the on full full We

that so the may amount loss And a item, the line, it non-cash EPS. SAVSU's piece below things for for we item, while cash but does take be a is dividend that instance, is the hit but

to that rate looking not sort occur. like growth we're now you pretty we and comfortable, investments make ahead lot feeling that of a So, Paul, of mentioned make right to have

Paul Knight

Okay. Thanks much. very

Roderick de Greef

Thank you.

Operator

Thank you. And remarks. Rice, I'm turn questions further would this showing for not at further to call like the over Mike any now I CEO back to any time.

Mike Rice

everyone. speaking you, quarter We And Thank you Daniel. with look forward evening. thanks first to Good when we report results. our

Operator

Ladies today's wonderful and today's all a This gentlemen, have thank and you for conference. conclude program you disconnect. may does participating in Everyone, day.

BioLife Solutions (BLFS) 8 Mar 182017 Q4 Earnings call transcript