BLFS - Earnings call transcript Q4 2020

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the BioLife Solutions Q4 and Full Year 2020 Earnings Call. [Operator Instructions] I would now like to hand the conference over to your host, CFO, Rod de Greef. Sir, please go ahead.

Rod de Greef

Thanks, Latiff. Good afternoon, everyone and thank you for joining this call. two issued we today, press releases. Earlier

developer was definitive merger first known Stirling U.S. our freezers. ultra-low Cooling announcement a of as based leading a signing the Ultracold, manufacturer agreement better of temperature of Inc., The and to Global acquire

The QX full financial detailed year our highlights. and operational release second XXXX press and results

These As and future regarding acquisitions. statements or the are other financial or during of statements future cause call, company to differ may we risks that this reminder, materially to forward-looking a make from projections the performance and expectations. certain subject may results events its uncertainties actual

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

alternative are release GAAP. to non-GAAP non-GAAP During Reconciliations in GAAP results. speak to financial financial metrics non-GAAP adjusted included or viewed we press metrics an this or be to or the issued as of this adjusted These call, will we adjusted afternoon. not should

or of to of However, we metrics of our use compared results that non-GAAP investors adjusted financial prior when light with in our activity, clearer current M&A provides the periods. a view believe

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

Mike Rice

call. everyone. afternoon and our Rod good you Thank for Thanks, joining

impact the their vaccine synergies of background, in the quite We to that’s point-of-care as potential a distribution are a these announced acquisition and support to just the our months of news few rationale due and very as been storage. of company pleased well bit last Stirling Ultracold, strategic present financial COVID-XX

new give detailed of important the some finished it’s color space gene provide would Rod. data, most a increase set like context, with to nearly in and Industry-sponsored get XXXX. candidates XXXX million, approved over year. increased get a XXX year. presentation of XX% $XX In I’ll We prior is was quantitative services. over Stirling, storage several to to some the XXXX BioLife for participating last we clinical revenue customers could trials space total by active cell media, the with grew direct on leave I Before over I up and To how I’ll the CBS freezers XXXX. the billion, XXXX, this was users banner review total right the new companies year across XX% therapeutic $XX therapy XXX to revenue media XXXX funding for now. how but Cold over over revenue thaw, XX% SciSafe end gained and including year. evo Chain, portfolio,

processed nearly a we are considering cross-reference the support using U.S. It’s new XX master largest X,XXX to XXXX, partners XX trials XXXX, media including not clinical we media, and customer alone. In Further FDA Additionally, XXX perfect sold our fourth we added match quarter data distribution and two also in added human new customers, franchise, trials. XX XX% take of XXXX, clinical share these, in to team files sales for planting of preservation we the ARM we is nearly possible new in XXX it’s if trials to last but use This shipped and speaks XX added growth. our up, our year. market new products data trials how our for distributors and our future media truly remarkable different requests direct our well clinical customers. is media to seeds since nearly our media

[indiscernible] to leverage growing cell the is franchise to approved is therapies; sticky our continue media four that to. Kite; Zynteglo approved ide-cel GamidaCell, engine CryoStor in from biopreservation therapies include continue from and Cilta-cel of from year. really customers Celgene, Tecartus from These this to and marquee services and and new Omidubicel from bioproduction could from used our used believe Celgene; that Yescarta market our eli-cel that bluebird. To-date, get in tools is portfolio media four from also Janssen We will Bluebird.

So of for marching to continuing installed in in this several media various anticipated approvals the the geographies. considering start customers years, and approvals we could still our base growth toward see for filing and large customer in year clinic

Turning in gained limited the customer we and although to last ability XXXX. full at new on-site our and person pandemic for the significantly products, year year in customers QX XX CryoStor locations, prospect our to XX% sell

and we selling new Turning Courier shipments partners With our has confirmed partners last evo our that traction to as our And joining pandemic targeting two We gain commence regulatory World and schedule the of company, container partners opportunity QX with and and evo The over customers freezer time, deliveries to In cold and evo citing therapy the U.S. will have we’ve to will to that the platform, the using working secure space. the EVO and new to CBS last monthly we gene BioServices of with in provider approving approved added believe to we strong much compete norm a platform, decision of in series management landscape some the customer support onboarded therapies. completed Biocare across gene than to few Fisher commercial chain this cell of are continue year. evo update logistics containers our been large filings, XX management Quick courier derisk portion the on-site courier Cold months, their pharma activities. Chain cell quarter. a again, next and to and of the shipments on Europe. they’ve customer curtailed more platform by become we one also

with and up We gained my QX recap, However, stage the full Rounding set a QX note our for strong customers requests XXXX. several new we significant to in a going on had finished XXXX. not agencies, growth new call with last we’ve SciSafe Europe. COVID onward, government team and year we’re from and this Starting and expansion customers XX U.S. QX received based customers directly biostorage discuss and and with vaccines. year guidance gained services X on this year underway very the strong in and involvement in the

just for take Stirling really BioLife confident and last So and get we the potential accomplished about portion to to are summary, are a our we next the we this organic call. heads year acquisition will with up In what when of of pleased growth the how Q&A level.

Dusty on Stirling a of today be as we contributions business. joining track current record is Solutions, transaction, at Automation has who CEO in turning after me high-growth close Tenney, Dusty and Now, Officer. the the to call our the and Ultracold, will transaction, the Operating BioLife looking Rod the new Chief Brooks of forward before that scaling at to and really businesses am proven scaling I his PerkinElmer. President And joining

current to X have million Stirling Dusty market consumption that comment creating energy a team in million welcome and M&A X family. the typical we’re Custom is We platform; BioLife customers years. not in fraction to freezer to strategy of and nonviable operational is ultra-low Biogenic last nitrogen of on and and great Stirling compressor-based the XXC, cell efficient entire help the biologic our strategy storage of ways million next are minus the and next recap the requirement that the years, currently management invest to and reliability With SciSafe is our in The market. and the no Mechanical that compressor-based of a our to SUXXX Stirling, compressors, a us world from don’t can be Stirling looked product a offering. range Systems’ enable total the that XXXX, predicated just XXXC. the and and on vaccines at provides Freezer of buy acquisition the to are but and Technologies in minus for a their fifth understanding prone $XXX liquid is no and compelling to $XXX to tool upright therapies There all SAVSU failures the Stirling identify Stirling revenue portfolio from damaged set services got providing at and provide. mechanical universal enter key supplier can ranges most a or technologies utilizing With then to goal the patient and We identify the dose. XXC the decrease These programmable Chain I XXXXLE, now used and work. range other our merger XXC the with response limited a significant most Stirling, a disruptive many and on Bio focused very biologic on standard BioLife. and and $XXX and to customers applications October, of cell offer the embarked shipping mechanical the minus between following to technologies. our the filing, minus higher will acquisitions temperature evo uptime recently portfolio, why fragmented initial moving requirements much August and in strategy revenue freezers fit Cold gene in X engine is XXXX freezers; such to deal the since systems, maintenance reason the thrilled delivering tools within in which system typical last Astero range parts acquire minus of with novel, ULT-XX, freezers, and The in we during a on compressor are and portable our benefits. that would manufactured which Stirling base our all freezer freezer off customers under-counter Recall our operate that we ThawSTAR landscape a temperature of family; an their reasons storage, novel start our materials broaden for have technologies we that potentially are of sustained XXC, We to X platform gene offerings. being our therapy freezer the reimbursement and from potential guiding is

and strategic this acquisition, XXX% of minus with the fulfills The of So and developers fit broader is to XXXC gene therapy biopharma minus cold line complete market. we chain that have excellent. XXC from freezer cell the needs now

and XX of BioLife supplying welcoming team addition leverage strong now another. have customer from team Global operational customers, operations Stirling, freezers is to Direct major CBS an be we’ll a and to who so we liquid Stirling to In nitrogen SciSafe also present will our the one synergy to that cost sales person

the differentiation. enable strong pickup will future that to will we product related XX acquisition from sustained products Lastly, patents and current Stirling’s

then and Now, can Dusty to the Rod Stirling, call financials to you I would the XXXX Dusty? over through background like to of a and turn impact Stirling the take us acquisition. give on our

Dusty Tenney

Thanks Mike. Stirling’s day shareholders. great customers This team is members, for a and

putting as conversation even growth Automation For assets products tools and Ultracold, fall targets and Each my to and acquired, team to into Mike further recently its of and of the time fit. customers out immediately saw broaden part the When followed I’m to of BioLife forward provide services. and President the Stirling about joining of to more bioproduction more to together, bigger that my my at own Stirling trusted build shareholders. critical COO I progress to Brooks Mike and reached And have value and I and supplier an at strategic and their the M&A executed me the more doing and BioLife company were portfolio really start looking BioLife BioLife list. the a last

revenue were and recognized were under have Stirling our employ upright, running and Asia-Pacific, team The flat support and We $XXX with acquisitions. Let freezers, and market of President counter over XX%; years. freezers distributors, marketing XX,XXX in large counter storage was in division Stirling. by X%; X%. on XX%; Since of sell along time, rapid a model, XXX these key VWR shipped since million Columbus, of XX%; in X%. in freezers August XX,XXX geography, Athens, X%. XXXX, By XXXX capitalize XX%; Science at to a the Automation, mechanical revenue background Preliminary and and segment, was and Stirling, Life when developed related give was over on down last in sales that is you by portable, use Inc. company $XX sales through distribution our out Brooks worldwide. team and currently members VWR. me after COVID-XX were was Science’s EMEA, At for facility, X provide and million, revenues we square $XX Stirling Sunpower, our the joined to applications. direct was Stirling America been its In at breakouts engines very the as spun works mainly out oversaw portable the foot and an Downtown Ohio, of $XX a has than I was and company who technologies million sales North operate academic, to IP date pedal also lines. from and Columbus. completion of under hard to and systems the of March successful where of industrial XX%; and growth point-of-care pharma manufacturing XXXX for enabling about estate various XXXX, And XXXX estimated vaccines. million. grew partner time to family about freezer freezers biotech revenue have I that our more By a several team government at We southeast inside We an Life little

a are have supplier We other in the and Walgreens Warp key partnered with COVID. to and against Operation fight participants UPS, Speed

Sangamo gene cell therapy cell Stirling Orchard and space highly valued count Moderna, broader with close some customers. gene and I also comments on the will in in key therapy our are market. and as serve We why the freezers biopharma and engine Allogene,

bringing repetitive it assets of strategies storage. proper a than further gene This pathways XXC, temperatures clinics and localized ultra-low BioLife’s to minus reduce regenerative combination it’s point-of-view the custody, efficacy has for risk, portfolio. freezers locations, critical the supply creates flexible include therapies. manufacturing has to and tremendous a maintain natural portable its truly as about cases and their highlights with materials Stirling XX and maintaining to benchtop these which viable traceability of upright cell gene use Use with BioLife Further, that temperatures XXXC This strong temperatures. minus that at allows ranging engines full entire gene as Just chain several customers, cold exist high-density that helping its maintaining cell multiple with and of assets to further provide with from address mobile given customers applications growth portfolio, a for growth engaged support solution Stirling temperatures and gene medicine Stirling while tremendous has the prominent customers customers and therapy to leverage range can easy makes viability ultra-low biologic cell demonstrated the therapy of fully clinical limited the the to existing all ULTXX under at point that counter without to therapy invention, material as less brand with minus required by combining therapies system, the couriers this full solution the within for to high purchases. that space they for also Stirling’s transport store distribution. cell at their BioLife’s cryo and storage while the and recognition partnered biological co-branded maintain

call Now, back I to the will Rod. over turn

Rod de Greef

XXXX. off Dusty. representing of $XX.X XX% start Revenue our I’ll financial XXXX of $X.X million. a a quarter quarter XXXX’s fourth of increase fourth XXXX million, revenue with the increase quarter for performance. the quarter over the of review Thanks, totaled revenue XX% over fourth $X.X million Media for was fourth a

of accessories included $XXX,XXX and automated Cold CBS. also to line, revenue freezers revenue quarter’s related million This thaw evo of the product in at $XXX,XXX sales $X.X Chain-related and

totaled on Media comparison an SciSafe, million to how smooths year. XXXX. revenue year XX% for see quarterly We $X.X full last the acquisition which $XX.X of $XX XXXX, of it XXXX to XX, is reported that XXXX media to throughout ended XXXX, best XXXX. over increase currently for in revenue full biostorage Revenue December XX% year believe compared year of continue to full the of related million, revenue out expect X increased in as we witnessed and million lumpiness XXXX. to the which closed is reflection also and we October We our the the growing

compared with margin year. Our fourth adjusted XX% last XX% was quarter for gross the

year reflects XXXX in adjusted the in the adjusted margin decrease full the XX% XXXX. The gross product compared for XXXX, both For lines gross margin the we in was to in period periods of and profile same XX% of margin gross acquired XXXX.

expected $X.X on $X.X with product million for in XXXX. QX manufacturing based XXXX, of evo lines Adjusted these of and addition, growth in increased million in In fixed freezer our totaled at operations. our XXXX expenses QX we compared overhead operating

For the as XXXX of support the growth operating our stock-based in to in compared count adjusted driven the million compensation additional of well and was primarily made overall The fourth and expenses full objectives. compared in million adjusted XXXX. The year as profit XXXX both XXXX quarter $XX.X operating with with acquisitions $XXX,XXX by in expense expenses increased XXXX, increase periods $XXX,XXX for $XX.X was related operating head necessary loss operating to of totaled XXXX.

for compared of Our million $XXX,XXX to income operating totaled the XXXX. year $X.X full XXXX adjusted in

loss Our with $XXX,XXX diluted or adjusted share income adjusted net fourth XXXX. negative XXXX of per the share $X.XX diluted in $X.XX per for was of compared $XXX,XXX net quarter or

the diluted XXXX, the share of For net XXXX. in adjusted XX% or $X.X $X.X fourth diluted fourth million $X.XX Adjusted million $XXX,XXX the compared with with was XXXX. million in full or net $X.XX year share XXXX per increased per of of income compared income quarter to EBITDA $X.X adjusted quarter of for

year And balance at $X.X to was the XX $X.X million. increased million XXXX. cash XXXX, million of $XX December XX% compared For EBITDA our with full adjusted in

$X.X million deal, million, the margins for all-stock and XXX% Stirling, whereby approximately expectation not of assumption $XXX quarter annualized in shares to on of Stirling. CBS imputed I’d million of freezer of closing in our BioLife the our this is a to with announced revenue business including price share outstanding on currently will revenue just fourth approximately few debt. BioLife Based million. Stirling. transaction a you XXs the combine margin modest has an gross low make is $XX, comments XXXX Friday’s of adjusted stock for $XXX profile EBITDA rate dissimilar the Now X.X of issue is Stirling’s common year. an of value This shares When like exchange the run of acquisition approximately and

of what the job XX over improvement and Dusty a during XX his clear achievable believe a months. and significant next diligence, plan an to However, for margin good did team articulating to be we

gross We result of into expect from introduction plant XXs. we ASP increased expect automation, new the margin to which and the high mid the expansion products and gross will move to higher margins

will entity while XX% So our particularly target can materially absolute the combined EBITDA with some margin numbers. we adjusted level, at gross that of XX in higher believe margin XX see margin and next the erosion, near-term we the achieve months to

will transaction the summary, with and following expect expect for acquire forma great and we in we remarks excess XX.X% In forma of to fit year on a will a be basis, strategic of our are revenue our net business, of beyond. contribute shares, year share a to pro revenue conclude accretive outstanding income which guidance the is my which this years. next XXXX. addition, and is pro I to which will of In projected EBITDA and XX% in we adjusted XX.X% per issuing

our and services. is Cold third, CBS product ‘XX, in freezer which to X and then systems, includes which report biostorage Stirling and then includes we and media; categories: services, ThawSTAR evo systems product revenue Chain for and freezer our So first thaw lines; expect

on range Stirling, includes for to current X. revenue of of from anticipated to business based to our is $XXX and to Total $XXX Our existing XXXX reflecting growth guidance be revenue XXXX revenue is expectations the on or before expected in million contribution of which expected million, is XXX% May year-over-year close the acquisition our XXX%. for

XXXX reflecting be million to close revenue expected is Our XX% Stirling between $XX May million following and product and between of $XX approximately including and growth items: X; million and of million expect approximately of accounting revenue; to XX% million, million $XX expected the million, $XX the million, systems revenue; accounting is to XX% over total comprised media the from expected total total revenue of $XX revenue, Stirling, between is for expected for and XXXX the that to finally, services to $XX XX% before and of $XX freezer total revenue approximately expectation XX% of $XX be to contribution revenue is for accounting thaw on contribution for be line, revenue. we given or XXXX from

Now, XX.X shares, shares have our count, which share million in terms will fully X.X in and share XX issued count, the new basis. going will shares consideration transaction, into our with on outstanding taking be connection issued million and of Stirling the we to a diluted million

back turn will over call to the Mike. Now, I

Mike Rice

cell Thanks, summarize to sticky generate of Rod. therapy companies, estimated have points therapeutic investment I clinical trials with with is three to each to hundreds with one, $X.X gene media of million candidate thesis: key relationships seasoned $X revenue, in annual would these so we tremendous want more very Stirling and million approved; and of into our our BioLife Dusty with team like brings baked hundreds customers trust our if buy and the to offering; have revenue proprietary us, cross-selling a products, of opportunity leader acquisition and and and rest we scale the Tenney. two, three, leverage us from a customer in

the over Now, I call will to the Latif? turn operator. back

Operator

comes Thank you. first line the Paul KeyBanc. Instructions] of from Our [Operator question of Knight

open. is line Your

Paul Knight

Hey, Nice again. seeing guys. Thanks.

Mike Rice

Hi, Paul.

Paul Knight

Mike. Hey,

business market your the is core that a rest that Could share do? what estimate? and pre-Stirling homebrew? does First Is the it talk question XX% about to on talk the share, you with of

Mike Rice

Yes, Paul. on, remains we believe homebrew. Right it

suppliers, have distributors out entrance pre-formulated media products anybody there. We see to or any any yet that’s of else either preservation really from

it’s taking believe, share, is great every BioLife are battle versus So, – really homebrew we a quarter. we and a it doing

Paul Knight

What’s who distributors? there? have meaning the And are with your And ops, key your Do you existing Stirling distribution have the sales? you do sales? terms of then direct in there? plan move in headcount what direct regarding What’s the

Mike Rice

that’s the mix couple yes, XX about Sure. are with sales about XX who pre-Stirling distributors a it and folks like call The current field organization, folks and in openings. current inside this. we I’ll involved look of folks, have, of Paul, in a

media XX the media. and do team that and or other a STEMCELL Technologies Fisher, are the and fairly the four, good so it’s decent distribution it’s a CBS again, big there regional on With Freezers, world we On distributors around job side, did diverse always, VWR, as MilliporeSigma perhaps in-country inherit with presence. well-known

we time our rationalizing will great So have just this. And from it’s feet more just perspective, a on the street.

So, force it’s multiplier leverage the all to a about story.

Paul Knight

And what’s the was and CBS, with see operating in do overlap of what as temperature synergy together? those you positives for customers what in perceived CBS two the

Mike Rice

Yes, great question, Paul.

range, the station the So nitrogen limited complete CBS, metabolism biologic to it It’s the XXX, which extreme liquid of is are, temperature for me, products right. with of operating coldest call minus material. pardon

minus to team in XX ability the this be has bag, sales all from XXX. range customer’s freezer in might way the arsenal, their the Now, their temperature whatever any minus combined meets to offer that

Paul Knight

it Stirling, Okay. Dusty, your your And there? COVID? at dissipate the into Does into Do then the lastly, thought we ‘XX? regarding have COVID duration we move what’s as on What’s year? thought the visible of benefit it

Dusty Tenney

great question. the Yes. and I think thanks all to reconnect first for Paul, of

associated the nature given that Mike this we the COVID really get not provided that had with of question. we at there that mechanics with the some point really time context think into in placements just liberty I of some have are at to

have will that one. defer to we So on

Paul Knight

Yes, thank you.

Operator

Thank you.

the from Chris Cowen. comes question Lin of of line next Our

is line open. Your

Chris Lin

just questions. my taking start… for thanks to Mike, Hi,

Mike Rice

Hi, Chris.

Chris Lin

Hey, Mike.

margins. to start, also largely to favorable have of be to strong that Just a because just business mix overall of profile. attracted Ultracold and dilutive investors BioLife so appears Solutions the revenue been highly instrument-heavy margin consumable is sticky the to Stirling

just you Ultracold? believe why So Solutions of you right is BioLife with Stirling this owner the in mind, elaborate could

Mike Rice

Definitely. I will ask will my start reiterate of and Rod points some in remarks. then the I to

hard equipment the Rod then even the us, cool this really sticky the customers ops believe we Stirling to to solve and the and ability to the margin them program that to definitely track find we from a this the several new years, more obviously the we to leverage have disruptive really of margins potential but side want enjoy Dusty and get And for right we and of So bolt-on back with our us. media something as that that acquisitions, you that their know, is customers we are to for here Chris, had and from buy attractive. nevertheless, about expose to offering the portfolio that problems. on on It’s novelty will would media more the believe lot the last Chris,

you expand if that, Rod, might to So a little could? you bit want on

Rod de Greef

a can. then I – set target remarks, gross as we adjusted target higher you to an EBITDA the pretty mid-XXs again, have source, sure. right. a have I is fact, call in on so have Yes, And of of plan that the that, currently for than well the XX%, that margin that Chris, I done think as the is much is XXs. internal margin into for a at based and that both achievable EBITDA. at company a entity. few bit, of EBITDA using independent in number in believe be there mentioned And and profile to stated, it’s years gross prepared as out combined once different going absolute at have done I as And adjusted the margins are the to mentioned, we we we much CBS, XX% going clear my we modeling vetted done blended be quite on with margin could Global as overall we a looking we low take not I the level. those absolutely margins But the

Chris Lin

it. Got

in figure that what say you in million, Stirling needs you could eliminations XXXX, a so revenue freezers? adjusted $XX or times? gross on if SciSafe guidance, Stirling potential And could that’s for million revenue Ultracold, revenue then question purchases, of another be Just Stirling to $XX Ultracold was to the intercompany net terms clarify pre-COVID of

Rod de Greef

question, Yes, that’s Chris. a good

to There of million. The year So, Global or unaudited for $X of the number here the this freezers form preliminary $XX million is CapEx number reduced operations. CBS million sold might the in going $XX be revenue to Global is come that’s last on base is SciSafe RAC $X move they million balance by XXXX. a year have side CapEx, into those when it the SciSafe in and of the

Chris Lin

Okay. your receive you well approval therapies that prepared referenced that year. – Last Mike there potential for therapies me, in this potentially question are could remarks FDA

volumes As that and revenue approvals guidance, these about include media commercial or dynamic? product from that XXXX we largely or manufacturing think would associated contributions explicitly be upside does scale new the launches XXXX with your those

Mike Rice

to yes, palatable Farther out, to We on sort pre-approval what up calls, trained scaled to their be as going which these administer of many fully is continuing obviously, XX will nuances. is they to to the particular that’s their a to clinical and establish operations manufacturing, all the own dose centers payers equally get up customers, because to XX good have get the reimbursement their big come strategy importantly have probably they been we’ve question. from for seeing and phase the changes post-approval, just now we’ve And articulating months would once expect that. been revenue Chris, trial done clinical to step of most

see a on the therapies. those, soon it changes us revenue to about ramp hopefully large in for XX post-approval approved to from think step-up be to So XX-month

Rod de Greef

I here. I fully Rod to additional it’s your Chris, question. sure because And clarity try provide little not to I’m answered want a

of revenue is XXXX the revenue, – Expected $XX million. Global sorry, revenue So full XXXX you $XX year million. for asked XXXX

XXXX May to the closing $XX $XX to We the BioLife fact of X. on that based not have million fiscal contributing we’re April million XX, transaction until revenue, it in terms the

Chris Lin

revenue was Okay. Could for share you just XXXX what Stirling?

Rod de Greef

revenue... XXXX

Mike Rice

it, it. got go Dusty, if for you’ve

Rod de Greef

Dusty, if that handy? you have

Dusty Tenney

$XX It’s Yes. Chris. million,

Chris Lin

for Thanks great. my taking questions. Okay,

Mike Rice

Sure.

Operator

Thank you.

Stephens. Jacob from Please go of comes question next ahead. Our Johnson

Jacob Johnson

Hey. Good afternoon and on the news. congratulations all everybody

Mike Rice

Thanks, Jacob.

Jacob Johnson

customer but side relationship? starting Hi, different there Yes. potential Mike. the to on frame evo there little news the on the congratulations on is and the I business give any is know a shipping Maybe for impact that model to up anyway color anyway evo a therapy? commercial it’s there, bit revenue on

Mike Rice

is that, the first to on position do we Jacob. Not of that. we shipments, so commercial more therapies, this in few to try splitting to their then yet, allocating Once one, get soon be hope too prognosticate would or these a to a but

Jacob Johnson

those try little revenues. of of Rod the given just guess, Got makes guidance given XXXX talk million, what way, for $XX for that factors services it to are SciSafe? the kind on about maybe end low the just stream, kind the of Maybe revenue end size versus Mike. million evo sense, in I range, to just it. high That the and and different wants if of a a wide swing bit ask $XX And guidance, of key the

Rod de Greef

orders. quickly the that customer the commercial rental One with two make the program, because the a on days, delayed It’s they XX so in in X quickly by are doers it is that is identified that Mike a over what other model if number up months wrestling out large evo that earlier, significant particular Sure. through there ramp does the that that an the of how very side, it’s the year how is monthly it’s things. the last impact. month seen remember And we’ve business SciSafe is go carry for orders

how or large is close, next we or on a that, get of lot get a half range. whether one it which in variability this reason timing gets based of And year other whether you of the the have is much so of there versus into you such one year relatively

Jacob Johnson

with for and me last for Thanks one sticking Rod. maybe that, you, Rod. And maybe it. Got

kind few on you your XXXX? thoughts any longer on XX% as Can Just moving modeling talked about us about think obviously, of margins, gross we margins the you gross term, near-term. in pieces about but color a give

Rod de Greef

Yes.

you’re of XXs. low think going the neighborhood to something I in see

Jacob Johnson

for Okay, questions. Thanks taking got it. the

Rod de Greef

You bet.

Mike Rice

Thanks, Jacob.

Operator

you. Thank

Our next Company. Suraj Oppenheimer from Kalia & comes question of

please. question Your

Suraj Kalia

Mike, me, can hear you alright? everyone. afternoon Good

Mike Rice

hi, Hi, Suraj. Again, Suraj.

Suraj Kalia

and deal, Mike the Dusty, on Rod. Congrats Hey.

a just information – were So and through significant maybe Rod, from give to more, Mike. kind How ‘XX XXXX And XXXX, were parse I BioLife growth guess a How if it could jump. of from is, that provided, lot I kind of ‘XX, numbers much understand may trajectory that what Dusty, originally? you a the much the at the see was non-ULT is ULT your just – you that for what if the expected looked trying faster there is extent and enough related? ULT. ‘XX if to was little you enough I organic versus COVID guess of you growing consider BioLife, is what I’m ULT I as is And to than can, company? I everything

Rod de Greef

near-term, I yes. think that the the in is Suraj, to answer

that at again, organic the that in think I would we look growth XX% range, is, excluding that XX% to sort of Stirling.

in And future of in demand. an demand, Stirling in the so in this there year, activity And is expect we that part going part related do to to increase just irrespective to related COVID bump also continue. increase to but in a be any COVID, revenue

contributor, be to them significant there’ll – that and lower of at the that so at range. grow And we end therefore, expect a

Suraj Kalia

a Got would it. a recurring ULT, revenue model, correct, And be ULT? base, not for this for point-of-sale Rod,

Rod de Greef

correct. That’s

Suraj Kalia

not are comfortable sharing incremental guys right? at this contribution COVID-related revenues, you from stage the And

Rod de Greef

Correct.

Suraj Kalia

adjusted integrate ULT, turn you you at person’s pretty the just give companies. enough. made of on bunch Rod, the this can strategy little a us significantly belabor when to been Maybe the you have confidence additional And to Fair hit. Since Give to this color tide needs prior can thing just has in beaten acquire piggyback taken to When margin? I’ll all Okay. composite know color. to XX% EBITDA a get gives midterm, what us some will I’m different the death. level determined going some XX% look from you you I they around question. Maybe a you the more. have a to an XXXX, XX%. margins of gross it reverse the margins, to businesses, gross

Rod de Greef

high Stirling to that right? are expand gross XXs, low is margins we’re So looking again, One which those then, give again, at ball are crystal bit. two And to in an expected current overall that driven by the blended would XXs, a the – to it’s point, the the mid- things. in

how into to mid-XXs, the for of the point So of be what would thaw little a depends XXs, margin are the but now. company they media, revenue then better, blended bit etcetera. if But much we okay. could thinking gross being is the It the mid high comprised the get it that’s that, on be somewhere in

to trade-off perhaps a respect to a customer patterns been the pony that, adjust BioLife adjust great for risk customer so strongly the out, had when that we has very if margin recall, And we on mitigate yes, XX%. we right? Suraj, we that that to out that things and And last strategy ultimate understanding recognize goal profile by you we one embarking that until margin growth, And to feel strategy, the where wanted so the acquisition you the remain the then was attain the about that product we but that very revenue can in now in we defined At have XX for that’s serious from gross did, we with fully narrative and comfortable has that talking months would order all $XXX margins near-term, declining XX with XX months adjusted and we that time, as the the the a started point it. of stated associated my scale are mid-XXs EBITDA XX% point million. margin time had

Suraj Kalia

thinking win, be last of Is commercial maybe you’ll – far on would least off one we Hey, The have two the one product for – Got Mike, that? commercial different bagged love would question line? a evo it. that too key players get we you. them should – in about color to on additional commercial at

Mike Rice

Yes. question, Suraj. Good

this important I this response, to would significant think understands which our company previous relationship. disclose is, refer us I just able rather than for this the to to directly, be be answer think is, how I’ll material that

yet there name. their the some respect through But disclose to we then, quite we’re but relationship, not will approval I’m approval. not at before out of multi-layer process, get that point, for We’re confident working perhaps going just

Suraj Kalia

questions. Gentlemen it. Got thank my you for taking

Mike Rice

Suraj. Thanks,

Operator

you. Thank

of from Group. McCarthy Our Maxim next comes Jason question

please. question Your

Michael Okunewitch

taking line is bit Thanks like on a I’d your to pretty on the Jason. announcement, like Hey, business. and for congratulations the big overall to this add the Okunewitch for generally. seems question Michael But ask a

pretty invested into the and chain logistics. You heavily freezing the cold Ultracold

like drivers the more it’s of Obviously, for growth consciousness, you just but in a be to what really this Ultracold in touch vaccine, business public COVID-XX lot the to I’d thrust kind it’s pipeline. area? mRNA first the anticipate chain So on into – key the

the areas where So to what expect really drive are in you this growth respect?

Mike Rice

question. good Michael, Yes,

a our cell in sticking approvals, within gene right. the of to nutshell, and be think to I pace about it’s therapy, going knitting

I business there. of than that ARM are one So many We’ve to shipments decision all been my more believe today we the out many the clinical our is use parts commercial to We our the by clinical the little data. really trials now award on how trials media articulated call one in. and off estimates about remarks how that large we this container. logistics know used know in than to to pharma split earlier company of their and more a partner clear

norm have some mitigation. the We got they risk years. the believe So few will next be over

into a So share winner-take-all of a strongly shipments. really, I compete of it be won’t those scenario decent configured to are amount we take and think

ability So courier that through really to great then increase and key win it’s our also approvals and of are see the in going be work doing. nutshell, partners on about the pace our a this the based to evo adoption

Michael Okunewitch

on I And Thank one actual have then themselves. more the you. freezers Alright. Stirling

compressor-based translate of cost versus And kind the compare savings? does how requirement operational So traditional freezer? more for energy does that a Stirling how into

Mike Rice

why question. one? don’t Yes, you take great Dusty, that

Dusty Tenney

Yes.

energy roughly energy which business XX it our anywhere think XX% it and an And frame the I strategy a that rating, of between ago. is to was provides an the element less used. of to does, Michael, compares in born it star material the out, being basis XX% systems important savings, years our as benefit terms compressor about what that

compressor-based more our offset to many the that freezer, realized So when you the a a our especially with to there HVAC, of heat material multiply versus use. system. that, of that traditional about some the getting with have start you to of the cooling is customers start less they can Stirling associated systems, benefit a a are are many partners different energy of freezer they multiple our i.e., significant also that but freezers of using And benefit parenting virtue the of fact is application infrastructure lot the think eliminate by when

Michael Okunewitch

mind. XX you nitrogen range just the I XX want based? target that ask Ultracold the the And you. Thank that more, – XXC one to to does How vary Alright. compared if CBS Stirling for case use don’t to that,

Mike Rice

Go ahead, Dusty?

Dusty Tenney

entire that cover applications there basically the Well, here, is Michael. cold chains I think two

when minus can minus a any those our any respective unlike system, So between tuned temperature think XX ranges. you to start XX, temperature be compressor system to about to

talked at So requirements ensure in Mike we is efficacy And from XX key and there to markets to that the of basically the when workflows, are cover and typically, cell Rod developed of this minus XX. every look gets meet that’s the that traditionally, XXXC. when are point minus between temperature. a single think prominent temperatures, this lot especially which manufacturers. about, coactivity, minus and cell in mandated terms support noted take the in biologic range Mike that you being we temperature transition the that that, end vaccines and driven is especially biological is a therapies glass course, temperatures materials ultimately so start more to even are that to to And temperatures, the highlighted. therapies When to a gene fact the researchers are being temperature the it just that colder the you addition about regards At the of most biological that temperature are that noted are the point, with in stopped. and that gene minus basically XXXC, activity deep the

the temperature biological therapy, for benefit the a gene cell in those two are focused be in customers we now the basically cold on that’s so single biological clinical two, the that entire ranges those whether respective every as today. those that combining material, today, is And chain provides critical range etcetera. said material So biological of all Mike that ever but each and fortunate use markets biobanking, trials, temperatures temperature cover world here have aspect we,

Michael Okunewitch

Alright. very much. you Thank

Mike Rice

Michael. Thanks,

Operator

you. Thank

from Lake of comes Flaten question Thomas next Street Capital. Our

Your line is open.

Thomas Flaten

afternoon guys. my Hi, questions. good for Thanks taking

Mike Rice

Hi, Thomas.

Thomas Flaten

guidance? SciSafe, million COVID business COVID quick a your there that Is nestled $XX all million that you’ve increase that’s obviously last quarterly during or $X.X $X in that on the and a from guidance deal suggestion to other some expansion there upside to was was deal, one in Just raised call, there million. is

Mike Rice

just bunch question. agencies. COVID that just Good to best federal the guidance to about of stick line talk based just on from a to probably we revenues And going our Yes. not received we’re

So to that like for do answer of little us give and to kind detail, early that. it’s I but would a

Thomas Flaten

Sure.

a If quantify kind it, we if you answer. could can’t but qualitative at of do least

during – the look in is know between that names out is the businesses? prepared think you customers if But of there I some you help about Stirling and overlap If what Venn diagram customer us were the overlap, the thrown could remarks. BioLife understand you legacy

Mike Rice

Sure.

customers are But storage. Somewhat contract can there that might also say SciSafe that qualitatively, use media want who for I some be. get or many how do I they and our with don’t to into

Thomas Flaten

from middle going help I was to the through with could And enough. sorry, for how to is spending about be like because help Obviously, perspective? until Can us you not there P&L the that a going quarter, through just be but next could little looks if think – us second to think big change the this us the to you wondering Fair a what bit middle accretive Okay. a EBITDA or think you’re year? of help you Rod, then, year.

Mike Rice

bit little We’ve because Well, the we of what say chose parts. a I to purposely I margin. revenue think below here’s – lot a guidance not can that give moving of got and gross

based I for to gearing of growth to that you what not if it’s just both – expenses become in saw from QX activity up looked probably a entity, some at XXXX may going XXXX. that say operating and the on will while larger be And that you so have XXXX growth we same is the to somewhat

Thomas Flaten

Okay.

Mike Rice

kind That’s year And the of that’s ex just the the Stirling, end at BioLife right? thing. of

Thomas Flaten

taking for much so the Thanks guys. Alright Understood. Understood. questions.

Mike Rice

Thank you.

Rod de Greef

Thanks, Thomas.

Operator

you. Thank

of Our Riley comes next Marc from Wiesenberger ahead. Please Securities. question B. go

Marc Wiesenberger

questions the taking the congrats deal. for on Thanks afternoon. Good you. and Thank

Mike Rice

you. Thank

Marc Wiesenberger

a could rush has wondering biostorage? from in space you maybe terms vaccines? I’m non-vaccine-related the the from to And secure talk increase of demand demand been with about in there players if

Mike Rice

to go want we think don’t I Yes. there, Marc.

to give any of articulated Rod we’re just forward how and that buckets I right stick other not on to report just say, how has in to to think the than going year. X going X we’re going SciSafe to going we’re it going granularity this

Marc Wiesenberger

Got some U.S. the it. and can Understood. Biostorage. about In in expansion of talk about maybe location to you Europe level talk remarks, the you we on Could related the color did expect? and prepared investment

Mike Rice

that be about, what Based we’re one not. not there on and might to to facilities. the is the be those where that’s definitely We’d going in from going the to, guidance. and is thing Definitely like agencies, guidance federal stored but we’re talk

that. going we’re So to respect

Marc Wiesenberger

Okay.

you your and How made what rights, there you media to in formulation? strategic forward? kind to investment distribution PanTHERA current going the interesting opportunity talk in You marketing about attracted that the compares December Can preservation an – CryoSolutions. what’s of worldwide their with And opportunity?

Mike Rice

Yes. Good for one. Thanks asking.

So dead. PanTHERA membranes during no a can the have and to then go synthetic you cells the crazy ice flowing water that flowing out, particular damaging. then formation process, water and whole in the inhibit molecule because has which of are they inside of formation cause freezing on rupture back is really That left cells can ice and

to that potential CryoStor CryoStor really our identified particular have gained be have well. the freeze and clear additive this we that to works Panthera seen media, molecule access could a as So of although be really, family to folks

would it as something be even Marc, could play. upside but an CryoStor So to cell spike with it we think types, make offense/defensive about there be better. I some this work certain could But think, nevertheless, with

While a opportunity the hands have in then to not them could the it, exploit also based cell as space. ultimately the that they it’s finish gene molecule commercially opportunity anybody this in that on with to else’s up have we something with work make particular to the hold we simply the help and sure where and spike might therapy come homebrew performance, CryoStor disrupted large and

based So to how go. have and seeing total of experiments looking how it the rest goes, forward we’re we we think on optionality the

Marc Wiesenberger

forward quarter, last the Awesome. onset year you cadence broadly, there was the throughout expectations some preservation Great pull and color. the for And year respective more the in the pandemic at then more the for can just the of growth Thank first about me, maybe just media the that business one given talk you. lines? for

Mike Rice

Yes. color. we any don’t But chime in you you We give – Rod, like. know, don’t quarterly you can as if

Rod de Greef

the is then which tough to the really probably the to going on pulled because $X.X was side in only mean media be ‘XX kind we that to year. say, thing million QX comp is I COVID, in was the off Yes. Marc, QX rest trailed $X a million going I from of the of of throughout the

some to it demand our as of we on did So customers. permanent that safety forward conclude pull the was part opposed stock

QX is, it comp. on but a think certainly, be the what side, I So media tough will it’s

Marc Wiesenberger

much. Got it. very you Thank

Mike Rice

Thanks, Marc.

Operator

Thank you.

Our Knight comes KeyBanc. Paul next from of question

Your line open. is

Paul Knight

Thanks for in competitors the your business? redo. your Hey, Dusty, who are

Dusty Tenney

that probably two Paul, we’ve got I’ll competitors primary denote.

Panasonic probably one think Thermo second. and the is I is

Paul Knight

Okay. Where know? do Do share? you you rank in

Dusty Tenney

I that I geography, two hovering the number by share, would bit think little around in is say a position mixed. market. the we’re

Paul Knight

on Astero on breakout the missed I the Rod, XQ? number then, And for Okay.

Rod de Greef

Sorry?

Mike Rice

lost you. We

Rod de Greef

Yes.

up. broke repeat? You you Can

Paul Knight

What was the Astero for CBS number the QX? revenue in

Rod de Greef

Okay.

Astero was – let commentary. me my find

million. was $XXX,XXX business $X.X and was Astero freezer

Paul Knight

Okay. Thank you very much.

Rod de Greef

bet. You

Operator

Thank you.

comes Capital question Northland next Our from of Byrnes Carl Markets.

Your line is open.

Carl Byrnes

for thanks Congratulations. the question. Hey,

Mike Rice

Carl. Thanks,

Carl Byrnes

any contracts considering to With addition growing, material opportunity you the the opportunity do DoD or see has Thanks. related Stirling been energies other like from BARDA? COVID government Stirling, in obvious and respect to to stockpiling from

Mike Rice

if wouldn’t you’re if generally, sure. then asking you just mean to Carl, specifically that, Well, definitely, we the answer Yes. COVID,

Carl Byrnes

thanks. enough, Fair

Operator

closing you. for like Rice, to to turn At Mike time, Thank remarks. CEO, would the back over this Sir? I call

Mike Rice

thanks BioLife. again for your in and interest Latif Thanks, everyone

this We more for growth. configured news, even BioLife is are all really share inspired and good to now continued even better

I to safety, very simply and strong the all health with quarter every team families report a you have good day that our look customers We we satisfy forward team our executes speaking is your this of you amazing. Good and here first to performance we of and and results. wish when night.

Operator

today’s conference participating. this gentlemen, Thank call. you concludes for and Ladies

disconnect. may now You

BioLife Solutions (BLFS) 23 Mar 212020 Q4 Earnings call transcript