BLFS - Earnings call transcript Q3 2018

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Operator

Good day, ladies and gentlemen, and thank you for standing by, and welcome to the Third Quarter 2018 BioLife Solutions, Inc. Earnings Conference Call. [Operator Instructions].

As a reminder, today's conference may be recorded. I would now like to turn the conference over to Chief Financial Officer, Roderick de Greef. yours. is floor the Sir,

Roderick de Greef

release quarter Thank you, joining to a biolifesolutions.com. thank September for the page the ended summarizes our The everyone, the of this Investor Relations release Good for the afternoon, third for us results is call and our afternoon, X press and results XXXX. X BioLife Earlier operating you financial at and Hughui. we which issued of the website Solutions months review XX. for available conference on

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

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

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

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

Michael Rice

than Once gene is and there customers to XXXX, segment. We quarter to gained filings, companies used of million, QX of engaged $XX the your distributors. through and note stock QX last BLA non-optimized losing QX and to includes sales in new clinical we over last in billion profitable cross-reference cell joining driven cell domestic increase regenerative medicine Therapeutics, some that of interest regenerative by include XXXX were income on typically of gene market of being business our therapy Sigilon over new candidates our $X IND to I'd network XX in report revenue by third or Bio, stayed FDA continue continue products robust over clinical the cell for million. products. from with year. I'll look our the therapy growth. commercial QX noteworthy increase therapy Continuing manufacturing adoption therapy segment. new process, of Flask Thank file To on cell to very another cells in typically are of and quarter several we $X.X future for trend international from Med appreciate funding I'm this customers data orders product quarter its XX% used XX% XX report The the an to and and report. in record also our consecutive funding, reached should relationships opportunity. growing to customer QX. profitable. customers. with and most in domestic a revenue recently We the Medicine cocktails. with billion concurrent biopreservation network high-growth, customer The Regen and detail progress XX% Revenue I follow clinical which issued our see pleased and customers for we the customers. regenerative with nearly support Thank This quarter master alliance good our preservation representing we third track, products QX international total cell to distributors. direct of directly are very that in for second and you, validated new is Regenerative sales no indirectly our clinical XXXX. Med the Total growth Of to of nearly net approved our and these or with proprietary Rod, our and very citation In are forward we quarters, was Elo-Plex that new Notably, customers everyone. gain in Regen safety strategic and customers trials call. Today, medicine names to you year-to-date. provide Wrap-up more of a sticky you our the Fat anticipate segment a customer and was market and gained medicine supplying growth some preclinical $X.X revenue afternoon, million was we Therapeutics. don't Sorrento our QX, Therapeutics, med and therapy of additional cells, trials of like remind was thousands continue BioLife strong media previously homebrew regent glad CCRM, customers and with customers. we and the and developed Therapeutics gene trial Eurfins, disclosures contrary, products are XX Works, and potential $X in on

they believe used applications, several case respectively and their our two our believe of who XXX approved in more our customer and We annual customers several freeze exceed at to STEMCELL the to comes a complete It's annual especially each every have distributors end distributions, Gilead visibility in range that XXXX. if more we customer also important and our range of in on have growth to guiding been portion we at of throughout This XXX had we very products are call our we're clinical to in our manufactory drive scale, CryoStor smaller date, and To proprietary remind XX% don't cell point on in approved really customer dose with total media dependent this this than the customer X distribute confirmation year. know, ship note Technologies potential is reach. to $XXX,XXX the have largest media. is you of XX% we is that cell than small term. current portion Regen bulk cell other plan YESCARTA is approved our end revenue and revenue XXXX. We outliers estimate revenue complete. our clinical and of KITE growth being, even that the represents that material distributors distributed revenue near revenue greatly biopreservation applications $X this as an revenue clinical million MilliporeSigma, full him I'll for We in range. our additional The in we XXX products segment unique on the a update users and listeners therapies therapies. with not growth QX so of the We cell approved frozen outreach most in from after will current don't in therapies clinical from used KITE's year we or to this total CryoStor XXXX a years. trials. to Med over revenue X from application have to example, impact For

XXXX of slower-than-anticipated growth cell point or home, therapies materially drive our expected not will approved XXXX. affect adoption the the to in So revenue

have stage product when yet customers The pull-through are base we have marquee revenue broad regulatory is we of cell significant first after as trial a obtain products generating a see they cell number revenue with as and therapies and gene therapy that approval. come. approved still I clinical follow-on to We use. embedded strong our growth demand And mentioned, and upside and in are phase customers clinical of trials gene before

over international of In contributed sales QX, or about $X.X our distribution revenue, our last QX and year. in XX% I'll this and of Next brief distributors. some domestic make million nearly comments grew total revenue indirect channel partners XXX%

and worldwide We for activities many nearly Millipore leverage continue customers our our and are Key worldwide distributors seeds believe VWR. end channel growth. of are future We indirect to partners. STEMCELL Technologies, so distributors marketing planted X,XXX being Thermo Fisher teams include, serving Sigma, sales

their nitrogen key design sniffing and Now reason deficiencies design management. enhanced SAVSU and also to is into containers and therapy assured to their users companies. and couriers for the service support to at have connected and CapEx and months. supplies SAVSU therapy here the and know, market suffering to as SAVSU's in depots, to pending manufacturing partners. on payloads state-of-the-art following addition regional and service sensitive. requirements more app aggregated innovations by will capabilities end gene temperature support data. lab you through clinicians, interest treatment that combined nitrogen customers OpEx team products progress cloud of performance, have SAVSU's generic robotic a and an the for leveraging the materials hope software rental family of profiles. management as offer It's specific ready has Courier, World several valued go-to-market market to and and and all time containers during that hardware over is users the platforms the orchestration back so containers are highly provide becoming who gross team containers. supplying opportunity, teams SAVSU of SAVSU of is data are innovative might numerous next technical customize I as generation a couriers, include depots. is the chain will growth in each has specific a traditional then, that as at emerge the ability Marken Other user ongoing include data XX% gene will compared they manufacturing gene of in shipping protect much The cancers ease-of-use strategy smart, clear approach envision BioLife customers, to use. and the courier data-sharing of ready shipment for and the and an other model. the The To payload very cloud-based app is doers leverageable and are sales to Rod the companies, JV A relative [indiscernible], made better owns couriers world-wild with also are are SAVSU couriers very is be of are I'm year on cell partnerships update and BioLife and other to thermodynamics patent such and been and corporate in investments the I'd final from other option monitoring evo. therapies comprised many tools supported a company biologic build-outs all the we through showcase specialty and platforms to the SAVSU hardware to prospective of office software Quick, number shipping say diseases and SAVSU differentiator SAVSU a drive of SAVSU's that that to personalized really their under offerings. insurers cell and key and SAVSU such for of. interest to cell These basically regulators you design partner and dependent The cell benefits is their competing accessories data of not like starting temperature in container latest containers shipping configurations to suppliers looked the cases manufactured products an biologic recap worldwide and whom Technologies, new the emerging are specialty SAVSU's over their market introduced current a revolutionary cold made liquid SAVSU best-in-class the the glad gene shipment to fleet disorders. or ecosystem differentiated for shipping on of innovations apheresis expertise, to a innovations preference SAVSU. to market. by containers. the leading fabrication There in expertise next of traditional from helping and that damage them bringing collections is previous in evo.is and testing enhanced and and SAVSU to shipping dev last built medicines can by patients methods its point partners the or over and and board the both are get liquid better The as reuse was thermal knowledge significant infrastructure These structure and and other therapy cell and tools Many market and branded SAVSU's facility

will validation it interest for significant in introductions week, courier this industry SAVSU leading front, cell partnerships today, SAVSU's announcing supplying technologies be and to are profit XX therapy release earlier SAVSU Novartis company press these earlier are a customers, leverage for therapy adoption technical year of is providing companies issued our media acquired by customer nearly $X products the a this and AveXis, Many support its SAVSU On gene by evaluations that SAVSU. billion. evo and we to proprietary relationships companies. gene of and to make continue BioLife generating

additional SAVSU We adoption expect Med in next segment announcements product during to few by the the related Regen quarters.

Finally, regarding a call, more our QX few revisit strategy, our valuable vision to like enterprise. we create take to M&A an the announced on minutes to I'd even

growth. highly manufacturing accelerate material and tool have therapy various is the offer For manufacturing to preserve time media gene services tools and cell manufacture side been now, we we and fragmented. supplier some in or biopreservation additional continuum, space acquire of to Med gene to Regen workflow cell and companies Today cell evaluating source therapies. The technologies gene therapy and used the opportunities

share share cost $XXX. spend requisition consolidation in We're Xx and sales Executing leverage, scale. evaluating or of updated tools you by profit marketing opportunities acquire believe process opportunities XXx. and Our our appropriate. including synergies the manufacturing several technologies per-dose of keep We to of $XXX when provides spend our benefits, tool the increases, ranges complementary to companies increase several revenue project from could we'll and to per-dose about the and and

months X XXXX. QX Rod to ask in first I'll our highlights the of financial for Now share

Roderick de Greef

Mike. Thanks,

representing quarter biopreservation revenue of third for reached noted, XX% $X.X quarter over third you the year. million XXXX a As media a last record increase the of

in from the higher year. The to For sales in million for XX, third Med last third Regen of up the X indirect of the $X.X grew to quarter revenue channel. primarily increased in compared months XX% The the customers distribution result ended margin to was to quarter million, September XX% of increase our for XXXX and last our both space gross XX% revenue $XX.X to direct year. periods

this for primarily in of margin in totaled was in in $X.X compared XXXX. driven XXXX. months to blended XXXX same first product XX% in of gross the was ASPs. for Operating compared The $X.X both the year, reductions and million by of X cost compared periods higher million QX increase For gross to to XX% goods period sold margin QX expenses volume-related

XXXX, operating higher totaled periods operating quality in For to the increase the marketing compared is XXXX. primarily $X.X first and management million $X.X compensation X and first million months of of result enhancing of increase related months expenses X expense, increased to The cost in sales performance-based both expenses our systems. the managers for

$XX,XXX $X.X of to million quarter's of third was operating in compared operating third the The profit loss XXXX. an quarter

period. to operating profit $XXX,XXX For $X.X an the million period, of operating compared the X-month for same totaled loss

for to share. or of diluted For $X.X per XXXX $X.XX the third common of $XXX,XXX net million to attributable quarter, a shareholders loss $X.XX was or common share. net per income third the shareholders diluted This compares attributable quarter to

to of X first attributable million to share the diluted negative or period $X.X of in year. net the quarter XXXX, million or diluted shareholders the a compared common $X.X months to $X.XX compared for same third net share EBITDA last last million For was per $X.X year. positive was $X.XX $XXX,XXX per loss income

negative to provided $X.X months, $XXX,XXX million third by X first in million of third $X.X EBITDA X $XX,XXX totaled was compared the compared quarter of the quarter XXXX. months to the Cash the For for positive in XXXX. operations

operations, of compared was XX outstanding Casdin resulted previously $X.X provided proceeds the last full compared Capital, flow less at exercise affirm $XX cash X the XX, XXXX, this same of provided. have year an months, million million investment of of equity the for used December in the in to $XX.X SAVSU, by outlook from The million period our cash ending incremental respect the warrants, $X operations year XXXX. September cash we in investment at cash made to million $XXX,XXX our guidance balance $X.X we from communicating of With and to by year. the by million For operations

our XXXX. $XX representing to As preliminary $XX noted release expect and XX% million XX% we in growth million, in October, revenue between over range early we to revenue

We XX% operations. operating to the margin come are year income our expected to cash in XX% XXXX. XX% expect gross and for expenses million positive and from between to to operating full full in between $X.X million XXXX compared $XX range net we expect and profitability, flow year

shares I'd last my XXXX Capital the warrant million to we our count count. totaled of with for XX.X earnings warrants only X.X next diluted of provide outstanding. now and brings current on the number common year, been and million We overhang, year, our share outstanding. placed exercises our XX.X eliminated, non-affiliate the We Since these call. of insider share have million. Throughout the warrant and had has so year Casdin issued effectively to will shares current fully warrants options warrants guidance like which summary in beginning we've of this a now addition Adding in remarks the you have XXX,XXX

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

Michael Rice

Thanks, XXXX. strong And track, both The business negatively not in therapies. for closing, approved strong and be volume finish the and cell delivered profitable for robust setting and impacted is rates by Rod. our on revenue we frequency stage In are adoption QX growing. quarter a will order profitable another QX.

of consolidate our Our a market. we and supplier BioLife. new and I'd for shareholders. their thank shareholders long-term to therapy continues see to like We support BioLife, customers our M&A cell and and look tool as the interest complementary add businesses to activity accretive gene future in bright for

over questions. operator turn Hughui? take the I'll your Now the to to call back

Operator

McCarthy from Group. first will in queue it question with Jason line come of And Maxim Instructions]. [Operator the like our looks

Jason McCarthy

bit what provide are little detail base could development preclinical, what breakdown you was customers on like clinical of cetera. customer of a wondering electrical, and and early at, particular et in I if you rough of or if So just the more stage kind estimates is proportion could

Michael Rice

Sure. estimate. some I of you sort can give

there estimate are chunk chunk more equally Phase used in we III So trials large preclinical. I large In XX Phase there and or Phase an there a II, that products XX to is are in our probably in.

customers a and I at T so cell So of Jason, what well-funded high-profile, clip, done T second-generation faster sales good we've new much very year, therapy and down. the the the would cycle, job breaks been companies it call, a compressing and gene innovative throughout a including we have lot cell or really acquiring that's how CAR

Jason McCarthy

And relating logistics potential and SAVSU, choose purchase? to synergies to should of actually of then Okay. from can company offering the shipping discuss you option single a media to some the you exercise

Michael Rice

observation, Jason. our and commentary to so. eventually in do we driver clearly company to option investment Excellent incremental a the our acquire and Yes, should decide that's

amongst identical synergy While points the chain related all of decision-makers necessarily source gene the precious therapy very conversations, media, containers and manufacturing in there this final management and there call biologic cold material is preserving tools products. aren't the cell lot a they're and and to because

overlap other offering. of decision-makers us company synergy of the the and to leverage part a degree part and part related of in strong the to So existing than an another one leaderships opportunity for to identify

So yes, great comment.

Operator

from queue Our with line of Dupuis Dylan B. Riley. will come question next in

Dylan Dupuis

shares this potential equity the So in SAVSU the to the or comment was remaining SAVSU? outstanding a little how hoping bit on and might I guys deal decision just AveXis more influence you outstanding can acquire

Michael Rice

recap that perhaps that perhaps bit when Well the start And choose a what why AveXis' and Rod, made we geographic time. at about regulatory about could we will option do the approvals. and about and publicly we to I'll talk just potential might a know just you decision little

first MMA reading is information learned they in we month is U.S. and I they Japan. regulatory filed those X EMA, what of they or of half BLA the few if it a that The ago AveXis in of about the an net call, the or of at in all pending months in a of is, filed of each more, October. the So public believe, they June in or year. next the have geographies a in can current approved be by, filing end

those how once approvals might SAVSU in adoption insight we'll ramp. rate so to gained, And the have are better revenue understand colleagues with at Rod? working our

Roderick de Greef

So months the Dylan, I the recall, have we purchase XX from option was the we signed think you deal. day

left that we fixed so take a to So It away months changing us is worried advantage option. have XX that about of we're about any in or not price from or so moving way.

with respect timing very near-term what driver is so financial or immediately their accretive making of related to consolidating perspective. the the final So statements, the timing driver XXX% accretive the in the point at to, that's acquisition will the really from fundamental that

it adoption the on As the and clear in negotiated we'll if then what's little we're of - - shorter. are and board, then to than we statements, it's goes more bit a happening Mike longer, takes as very reflected revenue pull why an the think about that unfolding. things we're quickly XX-month said, anything and technology trigger And how their that's the or financial window If it do then. he we'll opposed

Operator

Instructions]. [Operator

in Our Janney. Knight from come line with Paul next queue of question will

Unidentified Analyst

for This is Mike Paul. on

First see is the you and your utilization operating further, question, what's when full where Seattle that facility do headed at capacity? margin at facility capacity

Michael Rice

Yes.

somewhere the XX% our XX% it's room X to fair opened say running have. of that we're that recently of here in at up capacity. So to we neighborhood I second the think clean just We

or the when operating mean margin to ladder say you do So capacity you there? gross margin climbing with respect

Unidentified Analyst

Both.

Roderick de Greef

Okay.

in neighborhood guide when don't possible. last XX the margin XX. said into the that demonstrate XXs, into think to were Mike, would in to want And see double the million of doing mid-XXs, we low that's we I quarters in two we XXs if far we $XX have we clearly too said could were think revenue doing we the that a I that, but future, we out the past what is So the

depending or it little $XX would the potentially $XX where me million, think the objective. bit margin asked overall I XX you is be higher. years out. of an mid-XXs on looking go of we a that That in million, I you'd couple From If have if the range million and achievable XX $XX level could we're think operating a to in perspective, revenue an be doing

Unidentified Analyst

Rod. Do Thanks, wave trials where point Phase you we're II II clinical bill Regenerative lastly, into trials seems see a could III? Mike, we Phase then, there in approaching a of III trials Okay. inflexion see And or Phase be of to a Medicine. an Phase move

Michael Rice

bio Mike. you on question, Don't do a What an to have approved good back at the I to as X refer market the visibility last on the his is conference remarks and Yes, and Hard we more say. that so. year from to far or or approvals interest just have complete as would accelerate good that. recently about by prognostication X within FDA Commissioner, next Gottlieb, could products the

so for but downstream again, science Phase It and of it's a approvals that's good And all III. help, anybody all fingers all I data-driven crossed. think will so

trial on indications, time so I at targeting the be many will any and or customers mitigated, clinical is of similar we'd same them another think we customers, where have shots have clinical the that indication. customers couple right behind have the because unique we BioLife targeting many goal failure same single opportunity because

Operator

comments. at I'd queue. like showing questions further no the [Operator program in Mike over back additional to time, currently I'm turn closing for Rice Instructions]. any the Gentlemen, to this

Michael Rice

afternoon. Good Thanks, Thank you, Hughui. everyone.

Operator

all us. to our your Thank today's for joining participants This does participation. conference. you conclude you Thank of for

day. You may now have wonderful and a disconnect

BioLife Solutions (BLFS) 9 Nov 182018 Q3 Earnings call transcript