BLFS - Earnings call 3 2023 | BioLife Solutions, Inc.

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Operator

Good afternoon, ladies and gentlemen, and thank you for standing by. Welcome to the BioLife Solutions Third Quarter 2023 Shareholder and Analyst Conference Call. [Operator Instructions]

I will now turn the call over to Troy Wichterman, Chief Financial Officer of BioLife Solutions.

Troy Wichterman

Thank you, operator. thank Call. the and Quarter XXXX everyone, Conference Earnings afternoon, you Solutions for Third Good off call, our start on back and To the Executive the to warm give Chief today. Rod welcome call a with de who Greef, Officer, recently me Chairman I'd appointed is like to

financial business release we today, available and full performance year XXXX, results guidance. and Earlier for announcing previous the the On this of highlights our on call, quarter issued at comments press a we our will cover for quarter highlights financial and reiterate operational biolifesolutions.com. revenue third is which

As be subject will to we as given, date formally a SEC undertake be make are uncertainties and These our that of can obligation the statements this them. reminder, we to risks update during and found statements forward-looking no These call, in statements. filings.

adjusted this to non-GAAP we in also issued speak or We financial non-GAAP the metrics adjusted to will Reconciliations included afternoon. are or of GAAP release press results.

Now turn over de BioLife. CEO Rod I'd like and to Greef, of Chairman to

Roderick de Greef

Thanks, BioLife's XXXX my to and Call rejoining Third call afternoon, Troy. since Conference company first and the Quarter in Good mid-October. welcome

several you think for of over know who call the While most those the and have capital senior on XX in don't, technology me, of I to financial, I with XXXXs of early and public and both I you rounds years back operating of experience the medical in dates when Board raised companies the life history science My through BioLife industries. joined XXXX. Board

I the customers management operations, last and and with understanding of and and XXXX, and trading I until became shareholders. relationships as rejoined bring year as company's December of operational strategic I early solid strong as experience when and CFO retired a key significant products well later In returned the Board. officer

how the opportunity. asked it is return build time potential the The leadership And positioned an to times simple comes gene I honestly cell role well to and be answer with and when The is growth BioLife I to made extremely decision organization therapy of to in the say been the critical this at a compelling, creates market down value. generate I've why combined several our chance operating BioLife. and growth back. opportunity shareholder to participate can throughout position was that lead it to unique should the market, on

a environment our the experienced headwinds consistent our macro uncertainties throughout on stated and peers, large economic related and last quarter. As both bioprocessing weakness call throughout and and have third China funding small, constrained global biotech pharma destocking, persisted industry with to the the

they've we're to While through these these see presented of adapt challenges dynamic have opportunities been stabilization, signs as and we also to unable, navigate beginning times. BioLife

processing on cell In conclusion and quickly my my renewed to platforms are the immediate to freezer progress this as spirit, process focus provide divestiture prepared continue I'll our bring later in brief our the there update to of as a a on possible. our remarks. biostorage and efforts business

longer-term to that a drivers clinical tailwinds further of and intact, These is second- include a take of thesis by multiple underlying market In These treatment company therapies. space. are of to trials, growth. expansion first-line jurisdictions the from and what pharma interest and growing in in existing drive growth migration very to of the therapies a long number positioned well growth underpinned growing the the approved geographic we additional still advantage in our and CGT is allogeneic believe CGT remains order of drivers approvals profitable term, the large the nascent and

globally. and embedded by of our therapies and clinical XX in a in industry cell relevant media products CAR-T become trials has approved the total therapy approved media Our XXX evidenced being hundreds gene cryopreservation of standard, and

trials. tools In well used well XX as XXX other biostorage incorporated being relevant therapies clinical gene addition, in are as over cell and cell our processing and in services

is In market expertise, therapy, reputation cell addition, achieved our small other to there product to to of knowledge, position the that core is commercially any tend the in industry but not team of our couple we and a scientifically another oriented available scientific media have focused drive with relevant processing relatively approved the cryopreservation portfolio. sellers adoption

our during say context, QX portion allowing revenue to of while his words the platforms detail more financial to in I'd few Troy that speak like our results on With call. a to

processing faced in for by others the products these the in impacted sequential compared QX. CGT to internal and quarter, cell in revenue a our platform, platform third decrease For XX% industry in the expectations headwinds for same were line resulting with this

processing compared non-biopreservation prior cell essentially product Within quarter. platform, sales flat were the to media the

large conditions balance larger attributable The However, is XX% the attribute account the $X.X approximately customers to split X/X found purchases of approximately million and sequentially. for the efforts decreased overall to media distributors felt make of media smaller we that we our up approximately this or million inventory or that revenue of lower revenue, QX between media total XX% direct was direct decrease general of being we XX% the revenue evenly we which decrease and industry-wide. $X macro customers, to our several data, reviewed When believe levels. that was related reduced customer by their to sequential

Revenue flat year-over-year that services his team to XX% the On able Richardson, deliver. Chief results new were Garrie biostorage masked the ex-COVID the Officer, strong of and our side, growth

look as on for sites in to Boston, biostorage well will financial skilling New in as We our Jersey capacity expansion. will new which further focus and at Amsterdam, results existing positive strategically continue XXXX generate

a result consistent and a confident robust profitability profile. these flow in [indiscernible] will cash revenue efforts are growth We that and

freezers. to Moving on

that to that effort a will the timely services biostorage product with May. committed divesting and We're intended drive freezer lines building CBS refocus the this the recall to review core on of recurring and out fully And hard You a it initiated products its company announced to processing last well platform. strategic in August, the to its businesses proceed as effort this working close. are high-margin cell as and sterling

working LOIs to I multiple the discuss of still through At October, can't involved, parties Due other and have received any dynamics competitive specifics. process. the we gene end

will the expect profile the by However, we believe the post the the financial divestiture by media of generated core benefit to company operating biopreservation of We in say freezer on revenue will 'XX. close that from the leverage products. transactions early provided I immediately high-margin recurring the product

I founded announced acquired done years like part delivering business forward contribution has job management on part ago, as and great commitments and large As track refocuses he's which our expanding and proven a that then, BioLife biostorage business he as a the biopharma Richardson his the processing of team the Garrie appointed Garrie XXXX. accounts. recently record team Since maintaining newly I'd revenue to sales platform. welcome Officer. on to changes, Chief our cell to XX look of Revenue then our in establishing we as of

Now to Troy I'd third over results. to review financial turn like to the call quarter the

Troy Wichterman

Rod. of a our processing decline. platform. headwinds noted also industry to sequential in destocking are applicable factors And decrease cell of was excluding and you, related representing year-over-year $XX.X We revenue those with QX same decline reported decrease XXXX, The decrease decline, XX%. year-over-year, earlier, broader Rod Thank the million, generally QX was a speaking, primarily XX% of the to as from a COVID-related of revenue XX% year-over-year

quarter the over Revenue decrease in of Turning to the was period million, third $X.X our same services biostorage XXXX. platform. a for XX%

revenue XXXX from XXXX, QX COVID-related QX in Excluding revenue XX%. increased

in same decrease and period million, XX% for $XX.X the Systems a platform Freezers of over Thaw revenue third XXXX. the was quarter

Excluding COVID-related revenue from QX QX in XXXX XXXX, X%. decreased revenue

with in due was Adjusted gross margin the revenue to XX% high-margin was for media. compared The biopreservation third the decrease from year. prior XX% quarter our lower primarily

and in headcount to anticipation nonfreeze rightsize our reduced of stock the comp in organization recognized our million $X.X accelerated QX. cash in divestiture freezer At severance XX% operations. September, the order end by of the of we cost We of corporate operations in $XXX,XXX

In eliminated expenses. discretionary marketing and addition, we travel

GAAP of The to impairment operating was $XX.X versus were noncash largely businesses QX increase the million a for freezer in due $XX.X expenses million. XXXX. on XXXX asset QX million $XX.X

costs. $XX.X totaled with million Adjusted to compared million increase in due in severance $XX.X largely operating the QX was $X.X million year. prior expenses for The 'XX

was million $X.X for Our of adjusted XXXX compared operating million loss the QX with XXXX. $XX.X in quarter third

loss platform CBS of processing $XX.X in in loss the million year. compared noncash net QX in $XX.X million increase and revenue million. was million The to impairment Our of our in Sterling lower $XX.X costs prior charge and GAAP was to net $X.X asset due to related severance

compared in million Adjusted EBITDA quarter $X.X million year. the was of with $X.X XXXX third positive for negative the prior

revenue. adjusted to decreased due lower Our primarily biopreservation EBITDA media

profile leverageable profile QX in has Our by to profitability operating high-margin due outweighted our impact our margin on decrease media which highly a and biopreservation for costs. impacted the financial revenue, was

growth. to due to and minimal business Our of well products, expenses sticky biopreservation positioned revenue requires SG&A our media is the nature support

to balance sheet. our Turning

$XX.X cash XX, Our balance with negative XX, at September into marketable million use compared of securities and cash at adjusted $X.X million was EBITDA 'XX $X material our June media XXXX. consideration million, due raw XXXX, Taking in our of timing deliveries million, working largely the primarily expenditures of to QX and related unfavorable capital to $X million was products. of capital to related $XX.X

an $XX.X existing a XXXX, with at million we XX, market shareholder. October On pipe closed

good self-registration registration We our and a will and Governance Corporate will of we filing registration SX housekeeping. statement, related the from financing believe X SX is the be other the shelf One SXs near is pipe term. the which replace in shares to expired be to

Our QX $XX which quarterly of million, million SVB of long-term beginning balance with repayments $X.X is interest-only in XXXX QX debt was through XXXX.

guidance. revenue XXXX to Turning

the sequential which As freezes of services platform was we possesses on million, comprised modest August previously expect issued $XXX which approximately and platform, we growth; of million, total come end $XX XX, to October processing have cell $XX of guidance in our biostorage at approximately revenue million; platform, flat assumes and approximately X, million. to $XX approximately stated, low

we shares and Finally, million a million fully our basis. XX.X of shares have in share terms today, and XX diluted outstanding on as of count, issued

operator the open I'll the to turn questions. Now back call to the call for

Operator

Stephen. Jacob first Our comes from Instructions] with line the [Operator of question Johnson

Jacob Johnson

distributors, pointing as back. kind alleviating those the the the those headwinds large think buckets in as direct I maybe buckets, look fourth year? additional those into some pressures to we across of how color these good customers, persisting But certainly to the about the have think you're quarter. Rod, we Thanks ones next maybe about should for of breakdown. and smaller media on you the guess we

Roderick de Greef

Jacob, think at we're point, good basis by media customer. the a comment. QX, at for on that weekly and revenue Yes, look I when Listen, we and looking thanks

buckets, customers as direct of opposed and expect the to And to in distributor comes X would be. direct those throughout would quarter that ratably lumpier. that of small much we so customers, say business both in much, ratably And which larger is the where them the I the are sort come

or but at better the is really analysis in our comment we're what and respect than make to and come slightly with to We So that respect larger that's room distributors weekly direct still seeing customers, QX seeing. up based to normal. on QX some have larger with

So say QX. relative the this I would in we've guidance good quarter, we about on feel at to the we are provided where point

hold to sense XX like things fourth by through we which quarter side, customer. perhaps I the we'd think are the moment, it's a on will us budgeting any of bottomed seeing, process our is think what through because back to that We're we're starting again, 'XX, have up. better commentary move get here give on at going to then media the of kind

put 'XX think in when So will in to that speak we guidance, out better a hopefully, year. position to be that I we're early ready much the to

Jacob Johnson

it. by Rod. haven't you, tried -- lost And fast that then just you sneak Got on ball. to one I your

headcount. strategy Just go-to-market some changes cut Garrie, Revenue and you freezer Officer, any to kind Can you talk sale? Chief but the about of just post now

Roderick de Greef

Yes.

freezers profile the So tools is profile I pretty related selling to sales think different. versus cell individuals of those of the processing the

sales small are are group Sexton from processing as team and selling for drive basically message members out that those AB well, picked the who other tools and basically And so going our the adoption to cell and and Warner, experts craft Dr. have and a Sean in-house strategy work we cell with Matthew go as the who we processing here scientific media. obviously, up of selling

which be more we to it's to processing to cell really is you which as and adoption of know, new opportunity in other you side, there's capturing X media addition already we the pretty them, most sellers, writing these are if tailwinds But well come those on companies as of will, And -- the on the focused. on tools. going they individuals, and equipment X are entrenched capital scientifically team, but the the increase sales those focused, about more have than it's out, they're of freezer or really the media

we're his and into that. expertise with table what optimistic to that next and the We're be. looking Thanks, that AB Jacob. efforts brings results So week. married see you forward to team, going Garrie see are to pretty putting Matthew the Sean really Dr. the about We'll

Operator

next comes Our Hewitt. line question Matt from of the

Matthew Hewitt

much first the kind and one, areas to How reprioritization it from has curious, slowing the that We're into or as it pipelines the small of break the and large and the preservation of that Maybe little hearing of much is capital? shifting tied very the I I'm and versus that ends priorities pharma, how spectrum, there appreciate just weakness maybe much segmentation of there of to both just being kind you provided. is headwinds, regarding some their the where of been just versus of much a faster? out how some market, projects. customers more that is two? potentially you But look way cautious pipeline budgetary some come the market of pipelines could a of and back bit of is

Roderick de Greef

Yes.

do decrease large in they're direct large to past. to to think they several with those have with of the tighter customers, I manage really that that the part than I levels think trying internal the inventory respect has

what their And that, So truly any issues seen. to that. gets the see in I based products think or with of be it a customers. cleared really to phenomena, now is program cutback do opposed anything we're right remains end group for like whether QX concentration some that pretty pretty that subject it optimistic in their within transient or QX on But up demand demand, R&D that's we're transient any or as again, to high we

a them definitely of push some wanting back has an quarter repercussions inventory one out for for any us. hold material So and to order

to of other heck then, a of would that and the lot headwinds think lot the direct the referred you I in distributor largest where customers in you customers has our particular, see might small some of a be thousands. in a of basically who

a small are lot labs. of those research So labs, academic

had belt the more than larger be So that and respect and tightening the in both like tried much the might script we in that. those things with that affected so my press we to R&D, signal customers And in to commentary release.

Matthew Hewitt

And and to if early quarter, -- that? I'm divestiture, process super appears How at me of -- the it conversation That's year. how but maybe Got that helpful. end freezer it. that expected correct you you proceeding? then regarding looking now that appears wrong, the done by it you're is have the last targeting I are What's was the think

Roderick de Greef

the the do You bet. think entrants, really late to into It's more sort I And legitimate of proceeding. which delay buyers some with of are QX potential has company.

We've take X So up. got about. it's that's to so of what in forth mix them and the they we wanted have with, may come really whatever coming advantage holidays

know One it's speaking, likely it's happen just set in it's could -- but to or to both wanted people unlikely So and more level let QX. that early in I QX. practically possible,

Operator

line from Knight comes question KeyBanc. with next Paul the Our of

Paul Knight

When move event -- discontinued on to you what ops? this do need to

Roderick de Greef

a has Yes, Paul, in know since And basically, around It's we that's approved with test. ops. the much be need really things I've too discontinued very is been back, much In signed auditors able to ops. what spent short, gap too that I've the hand about discontinued complicated. time the into and put Board deal to

Paul Knight

this sterling? be burn the rate what your think view ex And the what's the rate company burn year? of And would you on

Roderick de Greef

our don't We're in into budgeting detail. I Paul. middle process, the of too much to get want Well,

as down EBITDA adjusted not have it And and of with better say that's think positive business fact much going would the BioLife business, media idea freezer was. that is to would here so as of be flow. I a had respect to non and adjusted was we're freezer been low what EBITDA I our QX irrespective in cash the we But that for it

Operator

of Our next TD Stephan the question comes from line Cowen. with Yan

Stephanie Yan

of ground already covered. Lot

two So just follow-ups.

of faster of could kind said as continue recover from of of on on line customers. Rod, some to maybe the direct larger they these So destocking. direct you questioning just customers that And back some these come

you headwinds. been give more gives companies Just of bit if we've bottom little on seeing confidence? to hearing you that a us can well what bioproduction maybe And from destocking regard some color other that that they're as with the a

what bit color love seeing little just a on out would So there. more to get you're

Roderick de Greef

last Sure. give an literally I'll into you that just situation anecdotal we ran week.

by do the much "Oh, to say, And of have back I'll a and minimize order then, they a specifics, later, we postponing what, the as delivery but for yet we'll try quarter, customer, didn't as So thought. call their we weeks them. large X and that us guess requested

the like the of far. to that suggests XX% that actually get order gone perhaps So too to kind we'd that's only year-end." that they've us of before one in-house that situation, it's and not So

mind, own It these management a need. from under umbrella. the corporate have shows their of about come operations in customers purchase Many lack of same large transparency multiple they that complete us, my they all but within certainly and what organization

store the they almost left open freezer as hand some at the the "Oh, they buy know not no, some." on. we has, So So see going is go hand and and and there's what that right better they doesn't enough it's cryo that say, if level,

but from seen. that's that's anecdotally, a so we're And And what we've reversal facing. what a bit again, of

Stephanie Yan

guys are to just the sure, guys in And going definitive when that's that signed? is said close that XXXX, helpful. a close you likely to super that then when disclose signing you that's No, that agreement? you will are process something to Okay. early divestiture And I question. freezer make last mean want does

Roderick de Greef

Yes, question. fair

announce signing a we're to the not think going definitive with I that agreement.

announce say a close sure appreciate obviously will -- we're transaction, you'll that. not competitive We the with parties. different I'd exactly rather where for the I'm but of are we reasons,

Stephanie Yan

Yes. fair enough.

Operator

Our with next Thomas Lake question comes from of Flaten the Street. line

Thomas Flaten

Hey, help transaction [indiscernible] likely us understand transactions? push business but Rod, welcome far, if more will to don't questioning both back. be the X to or be freezer you too I or businesses for can single this want a

Roderick de Greef

what given And That's the do can both Thanks, Yes. dynamics say that are involved there is we're table. Thomas. on I the I in. best that competitive options the can

that want both, parties that there want parties So and there are are each.

Thomas Flaten

it. Got can maybe SciSafe review with share to you U.S., Europe, for potential Anything most starting mentioned most there likely And respect you locations new facility. a to location, even likely Asia?

Roderick de Greef

think be would U.S. in I the it

We have very in nice has site that some a Amsterdam still room.

well So very to positioned there next Schiphol Airport. it's

think, Europe. good, So I we're in

So new a identify when location tenant, which, which an that. fixed of sign has you the likely that it if been after to then fill it strategy very basically, we you facility, that cost strategic the transaction and U.S., will, covers that Garrie's will be in again, anchor agreement or

on relative locking down very so identifying places that that subject and the to conversations tenant. in different to several the And it's are states anchor in going

Thomas Flaten

then previously might. kind I for year, Got if a I of but lot more out next I know numbers midrange even interest of obviously one, a XXXX there's forecast it. the just the what And there. forecast. importantly, like final quick you one had know understanding looks maybe in

You to look midrange out, comfortable might map feel what enough forecast like? that that

Roderick de Greef

to of I'll time, [indiscernible] a but data piece a don't I specific have interesting. throw

and the in. the therapies. gene approvals currently from of when media embedded in data there's least were through XX in XXXX, approved And we another is, which process, So we at that is it's in XX that anticipated look cell potential the XX we're have embedded

in the So our of that 'XX, doubled. by media it's number that is possible has therapies of end the

and beyond good that's So that number inspiring very and us. 'XX for to looks us, would for bring -- what a

Operator

from comes Maxim line with Michael the question Group. Okunewitch Next of

Michael Okunewitch

able can So I have color do where smaller you opportunity your impacting access may being be of you I invest could therapy. therapy opportunity I'd readily with how how biopharmas to may more longer-term like challenging guess and gene longer-term and by guess within environment trouble to give the cell you larger biotech see biotechs, the who into much capital? on to driven see if versus any cell current be

Roderick de Greef

Yes.

cetera. I the what good of think a revenue think our it's labs, we R&D side that A from media XX% on et companies call small question. those comes very I

And to I our number is majority approved I that our comes have therapies. for say the through that gets a have to I approved we think in board, II of several that stage, level And media I the takes early on Phase any that preclinical as Phase as they our direct get line. go get XX% believe of the companies small of revenue, that total bigger bigger, revenue particularly to impact it should percentage addition a when company substantive revenue from therapies. years going revenue, fact on actually into into as revenue

So a that's the there the early all. our if if the perspective, while is a in us shakeout that's don't going -- to at of little more we impact from merrier, bit things, of believe stage much,

Michael Okunewitch

hop back up how more business the to sale then And just at a deploying the and freezer of you bit free that? me, I'll the capital, decent the for of be at queue. potential you're look Are you that you that When what return could do would looking profitability? in could you and be best believe additional this looking think to is that help could use there M&A? where look at of with areas to the you Or the be any do capital Do one just something at?

Roderick de Greef

profitability, be focus deployed, that one. on the to it's is segments, product deployed are we would lines that's the business be right, in profitable going Well, the you sure, where believe to respect will, number growth. With to capital if drive for going

very going Is it growth. it if possible, happen focus. be be was certainly a standpoint, to Sure, inorganic not that it it's it's an So core very, we some of technology. but invest current may inorganic? possible that from to our would want in to adjacent And our

over and we time. know the putting work the product capital grow about it's profitability lines really, can that to So against

Operator

call time. De further back this Greef, the There turn I'll Mr. to you. are over no at questions

Roderick de Greef

few Thank not opportunity weather enthusiastic do, more and while that ahead operating more have emerge success. of dig will we for The but weeks lies been the busy I storm about you, am BioLife I back And positioned I in, more the a it's stronger, that clear well closing, agile stepped since confident operator. into us. role. I'm it's In an work to the

I'd to and provider and our broader drive also their like tools to cell acknowledge the thank for services to mission BioLife's as commitment leading unwavering CGT and team forward a biostorage of members processing biopharma markets.

Thank you all Conference we forward some for updating week. with calls meeting you and the your time to and of today, at future next look on you Stephens

Operator

today's This concludes conference call.

You may disconnect. now

BioLife Solutions (BLFS) 9 Nov 232023 Q3 Earnings call transcript