TECH - Earnings call transcript Q1 2022

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Operator

Good morning and welcome to the Bio-Techne Earnings Conference Call for the First Quarter of Fiscal Year 2022. At this time all participants have been placed in listen-only mode and the call will be open for questions followed by managements prepared remarks.

During our Q&A session, please limit yourself to one question and one follow up. I would now like to turn the call over to David Clair, Bio-Techne's Senior Director, Investor Relations and Corporate Development.

David Clair

Good morning and thank you for joining us.

me Jim are of Hippel, with Executive Kummeth, Bio-Techne. call and Officer Chief the this Chuck morning Chief On Financial Officer

statement. Before our me let Harbor we briefly begin, Safe cover

conference as factors company's of on statements and call its certain to beliefs Some during XXXX not SEC our other those could differ expectations Investor forward-looking company's new developments. within the materially operations well the projected available well from are XX-K update filings financial the year company's XX-K future results about to call. made identifies the potential comments in statements the during Relations does as the company the impact and maybe or forward-looking of company's forward-looking for of website any statements, or cause the fiscal considered information that made company's results including as as The because The section. future results. on this COVID-XX any this pandemic actual events undertake The

press morning call, business Corporation will During ongoing to issued at information available used provide measures measures to turn the be now this Bio-Techne call www.bio-techne.com. comparable may to are in company's financial Chuck. the these earlier GAAP Tables pertinent most on reconciling performance. to the non-GAAP measures I release website the over

Chuck Kummeth

our team as off for fiscal momentum you note, our Thanks, the experienced kicked conference XXXX very Thank The good joining our us we for Dave Bio-Techne everyone. last continued morning and first quarter on year. we call. during strong fiscal a

research geographies triple diagnostics future services the for and well growth growth for only and as analytical rate our for great organic demand broad our very reagents, start protein company the growth as our forefront but Investor ongoing proteomic forward recent Biologics, end longer the these adjusted deliver spatial at Western significant XX.X%. provided Day these growth. proud platforms our included especially this growth research biopharma on company the The our across markets strength our an Plex and within diagnostic with our and penetration drivers reagents, the of we strong and a focus under event. market. We were team's standouts namely high reagents, GMP quarter business. march portfolio, instrument quarter position performance across is strength tools our I'm first revenue targets Not term broad as to XX% digit biology operating execution offerings, in to and the and of of for Simple QX a margin during continued Our penetrated to global portfolio off the Simple burgeoning reflects remain profitability with molecular we quarter,

growth to During we the our made quarter, hiring plan. progress

From All organoids, development all a Although remained China XXXX will where are standout with technical reagents need the a pace. desired areas constraint of growth We growth us growth in strong of geographic The quarter. fiscal cells, labor and supplementing and government for record strongly geographies. especially medicine, have XX% anticipate in areas progress as regenerative over and authorities was the our tight our team enable to that the team plan. encouraging our teams we solutions. a delivered long-term continued stem of of robust hiring the market plans analytical a our organic commercial execution at there that building the experienced making across the perspective, unfolds, therapies immunology. a

in at annualized revenue. time business first our the over this quarter million For China in $XXX

believe we this realizing the important geography. innings potential in our is While remain early important in milestone, an this we of

very high biopharma solid overall strong quality end growth remain academic Turning Demand end our also with increasing markets in to approximately delivering users our unique growth our Performance be for XX%. end market. and within our continues organic for to the products revenue digits. solutions mid-single

Protein growth growth let's the in the where XX% Sciences quarter. led segment of Now starting the as therapy portfolio of growth initiatives for progress awareness We and XX% our to workflow we growing with and discuss delivered organic performance quarter. the our with in made our platform significant gene demand solutions over cell of organic

state are of qualification manufacturing from the in Minnesota, coming initial anticipate the lots and GMP grade protein facility out of process nearing the for of completion facility Saint the be orders of in We Paul, GMP proteins weeks. shipped art commercial to our

are reminder, therapies therapies GMP of make the and the demand through both we going way process. increasing anticipate cell for autologous as growing ingredients rich approval pipeline their critical proteins a As regulatory and allogeneic forward

of in cell our stem and for a Our to positioned GMP for we open in translational protein and critical ExCellerate cell therapy, isolation, iPSC The cell quarter. Medium, and culture or of meet over increased with on our pluripotent in business, and facility and Expansion with portfolio are workflows. products products launch new Medium expansion, well to XXX% a added workflows, cell Bio-Techne's anticipated manufacturing Expansion maintenance portfolio cells we in regenerative characterization. gene engineering, Continuing cell fits research iPSC genome business new our the induced And the for growing stem differentiation both offerings including medium these expansion seamlessly demand services builds GMP medicine reprogramming, use reagents. iPSCs especially for into for ExCellerate the

high natural for translational Expansion core This without and especially gene addressing using is cell best that businesses in our strategic continued efforts. an current B to reagents culture believe latest our cell our aware class killer relevant or therapies. cell builds a address customers' produce in ideally T to increasingly in continues our only Importantly, We manufactured new antibody based ExCellerate cell core XXs and that iPSC products of needs, portfolio also marketing quality in NK, capabilities customer and in research iPSC making from digital humans, growing success while or with Momentum derived quarter. very our components growth use needs is research a animals media. in through be on offering them our low of suited protein strong, development it Medium reflection making of our across the the research use

represent quality for Encouragingly, to for seeing these and grew the purity, on and continues the during of of of full now and instruments use instrument, see proposition and for CDMOs pharma across solutions. where lead Western be also control Abby over XX%. a on existing Moving In sold a XX% consumable quarter accounts protein generation to Demand reproducible reproducibility enable portfolio qualities all to cell our prior with to several large effective proteomic fast led QX first with very strong pull our instruments we biopharma strong Maurice analytical we tools, our productivity that way Reflective and continue new tools, our strong we applications. market. the quantitative are environment, and of are our growth gene in CROs, homogeneity, adoption compelling demand to through namely over related ease growing results, XX%. and significant the our of Biologics seeing therapeutic therapy identity, year. now compared continue analytical instruments also These Simple nearly systems analysis cost its

this technology automated further view in a and As chemiluminescence western untapped is academic real a therapy lower to market our is April we robust significant and Simple into Separately, Western going gene fully platform cost reminder, this and customer Western that we introduced adoption, cell for of penetrate base. largely Simple saw Abby technology within forward. opportunity a

Our comparison increased had quarter the than amino where is Simple the Plex multiplexing a more Simple XX% acid XX%. Ella, in year-over-year system result Plex year also This growing challenging given impressive prior especially period. strong over

or in requiring NFL experiencing specifically and are using accounts for a for light platform NFL neuro be of applications We and heavy the customers to detection and significant the speed. continues Ella platform neurofilament choice sensitivity in assay chain or uptick or evaluating for neurofilament serum Ella excellent neuro plasma. chain degenerative

and diagnostics the revenue where segment X% in genomic organic Now discuss increased let's our quarter.

from sizes reorder business therapeutics the our offset Our increased was in therapy gene biopharma, over business a when ACD XX%. business created in biology digits has in the in custom continued academia ACD an from making order for little branded increasing would design the especially CROs mid-single academic animal biopharma customers. year lumpiness probe RNAI toward biology and emergence prior our of I lower especially projects, partially business. and or spatial larger more the our market Within faced RNA challenging demand driving our shift as the interface model based note spatial projects comp by a rates quarter increased customers, a and

platform. interest species many over the targets XX,XXX crossed approaching now XXXX academic publications is process the over continued demonstrating of menu Our and have in

launches, our the upper of reagents Encouragingly, accelerated in experiencing existing impacted ninth in and lines. consecutive beginning growth, single The customers, the penetration organic starting delivered business diminishing that are this increasing glucose product OEM growth hematology business to headwinds are the related business. recent digits. diagnostics controls diminish his the headwinds new Next, just in pandemic additional with quarters we are a reacceleration at and and in its chemistry, quarter we combined of product revenue within with believe

molecular and Exosome diagnostic excellence business. based Exosome to we diagnostics test, During as led within designed former being innovation changes segment, our of engine, some recent organizational based This developmental Asuragen the biopsy biopsy Diagnostics the the well products. is across legacy as highlighted and the new McManus, combination Matt diagnostics and and synergies Day, Exosome our division an developed of lab diagnostics structure businesses. business, products developing The CEO center by molecular is opportunities Exosome kitted our our liquid within new as companion genomics Investor division acquisition and realize fully liquid a includes of Asuragen

Asuragen our channel leverage as these well as CLIA will established commercialize products. the We to labs two

market. make test continues with ongoing urology Our ExoDx prostate progress challenges the despite to cancer

dramatically patients volume continues risk since to urologists COVID meetings forward. that their ExoDx our events diagnostic checkups This the is annual patients a person and with sales not for and tool or prostate and QX to hosting recover to are expect show our home in improvement follow the of checkups patients' test onset seeing their by to the would which the strong return continuing were QX. getting educational During was community, be the routine highest of impetus our market note pandemic testifying primary or going used increasingly and With ups, urologists. also to physician early to and beginning cancer test appropriate reps doctors the the I for in identify potential we ExoDx analysis awareness encouragingly for PSA to the leaving reduced biopsy. to do volume

to contracts reimbursing expanding added made multiple and also ExoDx of network We regional a front reimbursement men private with to payers test. for during access covered payers We progress on ExoDx quarter. the both with

are to the Care during opportunity Fall and at science makers the very supporting Forum. and of community. The Events medical excellent this national XXXX directors from Managed regional the opportunity an drive payer are and We confirmed important awareness XXX largest present among excited to this and reimbursement publication week an and policy this audience payers. overview of to ExoDx private decision Live about includes NAMCP's eventually representatives like test the acceptance

avoided cutoff biopsies of of demonstrated biopsies publication and grade, score pooled cancer. high ability benign with of prostate ExoDx's XXXX of unnecessary prostate have predictive of over Using journal between patients the XX.X grade recent negative a XX% diseases discriminate cancer and would prostatic analysis and value all to low prostate ExoDx's a in Our XX% validated of XX%.

forward. publications drive have of cadence and additional pipeline and a studies anticipate going We reimbursement adoption to steady of a

we kidney the diagnostic to pipeline tests, addition ExoDx our continue transplant advance of rejection Exo Exosome including TRU to In non-invasive innovative assay prostate based our tests Kidney.

this initial best the TRU positive and versus Society of we value predictive in year was reminder, data a Exo Journal performance view the value a the a Nephrology, of Kidney of of as class XX.X%, predictive showing American earlier negative published As competition. which in XX.X%,

to US with track publication based With preparing traction additional assay Asuragen regards fiscal studies year. non-invasive this launch business, continue position This products portfolio of potential we and remain performance, the for markets. to the European US and are leading Exo initial these for have for market outside today diagnostic Bcr-Abl. urine business TRU We including kits products significant centric the is products, assay legacy our later penetrate and oncology we from our molecular and largely to in on our taken steps to and see FMRX on to business gain genetic the the

carrier expected this FMRX, launches well combines panel, to pipeline, in opening my and do business including and very is expansion, X assays CFTR to for cystic a geographic 'XX friendly fiscal SMAX comments, to the a great as or of conclude which user has kit CFTR the full In kit. addition screening a as a To off one hard fibrosis our start.

remain markets and strong, products reagents of are our penetrated tools and portfolio in customers electrodiagnostic our growing end and meeting of Our differentiated the proteomic under needs markets.

gene acceptance of biopharma with customers, deepening in end Our from therapy the our driving continue users our cell relationships to adoption proteins, assays portfolio. and these other media, instrumentation, and antibodies offerings gain initiatives are and

recent target X our laid team strategy company billion next revenue $X of out Bio-Techne leadership to and our is in to I During Investor the City, over billion five and York years. from Day New today the a it bring vision

and excited a start off this come. over vision With share are we the the to in call many realize journey, I'm that hand we to as this end over Jim. quarter quarters first to I'll to Our progress our great

Jim Hippel

provide year. versus $X.XX overview of over adjusted the was the company, increase XXXX Thanks, performance provide segments financial fiscal of year and of total one some our with ago, QX overall performance quarter EPS performance, our an Chuck. give on on financial I'll fiscal remainder each the the additional Starting XX% the thoughts an details for $X.XX some of year. of last first

EPS $X.XX. Foreign in revenue organic year gains this QX an $X.XX in than on on biggest an of the compared EPS exchange by compared increase was year. a basis for the driver our $X.XX business unrealized to in from prior to positively and XX% prior EPS quarter basis. loss the year operations, impacted was in XXX.X was ChemoCentryx the unrealized GAAP The million, period. an increase XX% GAAP for ChemoCentryx reported on investment year-over-year other

year-over-year growth. over the and growth a biopharma market had Foreign exchange revenue of end for year-over-year. over X% digits upper impact growing impact both followed by By remained one strong EMEA All had the favorable very XX% rest growing had XX% academia mid-single quarter, favorable grew the world in the geographies near while X% a led China XX% acquisition the and for strong and translation by growing increase teens. US

a The by sciences protein details the within XX.X% gross was decrease in to points volume was of prior product R&D favorable total XX was primarily P&L, mix point was by X.X% of the Moving Adjusted company on offset QX to the than XX.X% compared of the in compared driven basis adjusted quarter to margin basis XX unfavorable in revenue, leverage. partially year, decrease SG&A the the year. XX.X% the prior prior while year. higher segment QX expense revenue, in

all at engineering allow year, especially both additions prior and fill more increase anticipated, SG&A originally labor adjusted spend the and and technical, us to a sequentially to Life in pace tight scientific While we R&D the market not compared fields. planned the Sciences team headcount to the

in will we plan the XX.X%, increase margin to year continues hiring points position The a This adjusted quarter. the of capital to in of XX going basis result our for from critical and investment make second forward. growth operating QX in pace for human was our fiscal decrease However, prior period. company additional progress

year. excluding impact operating over the increased last April, prior the However, acquisition of Asuragen points margin XX made basis the adjusted

million X.X compared a Looking to debt to period. bank expense of QX blended rate. decrease at reduction interest year was due The in lower as interest a net prior decreasingX.X operating well was numbers our million, below as income, the continued

prior primarily cash of as related Our impact expense QX compared adjusted the million was of year, income in foreign the X.X stood Other the million. X.X quarter balance the arrangements. XXX.X for exchange sheet reflecting million to bank pooling debt in to our in at end non-operating the

non-operating GAAP investment gains income For reporting, and although includes ChemoCentryx. unrealized from our

down QX adjusted further rate XX%. the P&L, in Moving our effective tax was

of non-controlling As was well providing formulation second media focused loss a investment The portion Eminence P&L fiscal lines market. on do China a reflects result the biopharmaceutical Eminence immaterial of company to of consulting strategic as cell $XXX,XXX from during development quarter of own. media we made services impact reminder, interest based line line Chinese a The the XXXX, other in we custom and QX. as the not item a equity Eminence, a in the as of

QX cash capital. income return in cash dividends. average QX, in operations million by shareholders XX.X In was other from year to investment net generated XX.X capital million returned Turning period. QX, million, timing the million flow compared driven and in to of capital accounts expenditures shares payments and payroll, during cash finished of The to We million was payable. the XX way taxes with outstanding. the was our decrease we prior X.X of of diluted quarter by and primarily for XX.X in

million total a investments, with cash XXX.X well balance available sale finished and leverage for EBITDA. Our under short-term of QX very strong position sheet in a times one in and ratio

increased XX% performance revenue instrument the assay year. increasing on with discuss sales reporting Within broad reagent prior of this segment, to with segment. all of XX% Protein growth XXX.X strong having a Sciences was with platforms. in Organic were the based segments I'll revenue reported compared Next, exchange X% favorable QX and reported nearly million, foreign impact growth. starting our growth the very

and favorable offset future points was investments products, Western, Simple cell XXX% therapy due at growth least XX.X%, basis grew mentioned, over XX% support Operating year-over-year while in increased primarily biologics strategic for margin increase Sciences including XX%, to gene XX%. our an and volume GMP Plex, largely and Chuck to As by all growth. grew of over the almost protein antibodies XX segment our proteins Protein Simple leverage,

QX exchange on impact having segment, was segment a X%, upper digits, increasing Genomics reported the Organic with growth sales revenue reported mid-single digits. XX% and favorable X% spatial diagnostics portfolio acquisitions million, and revenue. increased XX%. with translation The this contributing biology Diagnostics ACD business reagents foreign and branded the single to XX for increased Turning worth

year-over-year had within capitalize quarter, biology challenging this unit multi-omics on are science this this as a comparable positioned being extremely tools, and portfolio. business growth spatial with to Although life area we in a view high our product well growth

volume lower of revenue change projects the cash Exosome customers was mostly For year negatively due patients. to revenue but Medicare Diagnostics, counts continues prostate ramp prior QX see patients physicians. for continuing recognition we with test biopharma in growth back Timing XX% year-over-year increased the was cancer also Test accrual diagnostics and more accounting this with year-over-year, are quarter. companion Exosome to improve now their to to QX. Diagnostic enter as going for impacted in to

on executing In tailwind Moving summary, our markets. of Diagnostics QX well serving decreased XXX prior impact markets our to well And extremely year. margin support and forward. going to research to operating future oriented XX.X% acquisition. will at to a strategic continue strong. segment's as performance on basis end indicated, are operating market growth is the also Asuragen as as end believe we segment these The diagnostics improving decrease be margin, remain points compared reflects investments and Genomics the the the The we

Our challenging rates our the become have of increasingly quarter march end the proportionately crisis This tempered the more and markets comps our be means of likely been term. growth XXXX. in on fiscal fourth depths near the an in will upward since COVID our

achieve two year growth increasing fiscal given end XXXX. confidence year rate that we XXXX of the than fiscal strong can our CAGR gate our at out QX, we in a greater that the have in However, year is performance of

by line the before end sequentially term, questions. back QX. in the year comments. returning pressure concludes in levels plans. prior to adjusted to As there to order progress to our That mentioned hiring our our hiring open call to operating to the on turn our anticipate despite of in near continued our Chuck executing put plan, the in fiscal our that, growth support do my prepared with We long-term is downward And margins the objectives and more prior I'll operator progress I commentary, for

Operator

Please question-and-answer conducting will a first Thank of Our question. [Operator your proceed Leerink. with you. from this At be is time, SVB Puneet question we session. Souda Instructions]

Puneet Souda

questions thanks, here. Hi, Thanks Chuck, the Jim. for

one first on strong. clearly GMP So proteins,

if new seems qualifications really XXX% parse last orders sustainability that could annualized out is for Just strong growth that to obviously the how it's additional But you and due maybe in wondering out like coming the it of think GMP trying XXXX? an year. was off orders quarter. or shipping of sort and of in comparisons GMP here understand of we just rate should of proteins to about small the growth

Chuck Kummeth

that couple probably been we've clear rate past level. is XXX% growth pretty the at Yeah, of next for years in their

- for and and open we're of we're lot of an gaining qualified today, of The still ahead as we're I business. products been guess, more So material, But factory that. we've has actually inventory customers. more,

potential about partners dramatically of the a investor from of already. slides we're a increase couple lot getting scale saw And we're You to talk in the the got help ready deck our dozen domain customers, that.

So we're getting more we're customers, existing scale getting customers. more and for

of So run over transitioning the we're orders the to ready We're kind just a We're our as Puneet, into can well track. $XX therefore is we much lift. new start of as so million on beginning factory. rate, right the which really

and proteins, handful the in largest type still a catalogue. so of lot have just we under you factory, product capacity at in GMP we in We for have the lots. we only really new there for know, catalogue right of XX but majority businesses headquarters, up XX of set in As versus now we're or small a know out the back in the it's - our

guidance clinicals, I we to products largely the it'll the for and put into continue. So cetera. a being that I see growth think of rates go And bigger ready are important with consistent for et are asked on few to be our lots the more being

Puneet Souda

for Chuck. Thanks details, great. that Okay,

wondering for there's quarter. to keep second we ACD, on something need mind in of if So sort

- trying dynamics continue historically to think this happen the just were of, to digit you comments that traditionally just XX% that sort first and/or should we this mid-single of than more And seems understand competitive it aware leadership been change that's the the we're lumpiness time to Just seeing business. around made any there in business trying just need is to is But ACD. lumpiness. growth the here about in the year we for is full expect be number to here after

Chuck Kummeth

this then - ever as bullish flows. just and lumpiness the off as in it's had of, lot you service just remember, a kind coming we that got area. We're was platform, of But do on part the they ebbs was and of comp primarily work. amazing to the custom And balances, - were we

combined our is XXX XXX with that the So ahead, - which last people of we like net rest even I as we there. XXX, average you quarter, right know, better couple the world. than we're we're a mean, just XX people plan, in hiring added out lost and

So really Bay especially Bay area. in the in the where crazy, and guess area, ACD lives it's been

units. we than there So we are other shorter business are most

We also the there. largest business are spatial out

it and we're of issue, the why we're now. reps of all on. and It's better our three to scope focus than It's as wasn't in those well, issues on ever. target XX no reps, So there's this But kind that. a DNA it's there. put are is mid-single coming - especially digit XX. and it And we've one, for correcting actually growth looks definitely why our additional two the was shorthanded we're

coming on. We have X-Plex

lot some especially now. and and and half comps, It's an right a probably pretty automation. with going we of And do with have of with in The beast That's done area, get Leica. ago, SPD. a We're reps hot we'll more year, forward other lumpiness, year We're a refilled. issue leadership of in But getting of with services, ever Antenna. than in generally, handful ideas need are it's key the areas changes we that. to stronger we'll partnership sales We a well. made movement kind do spatial that short so of nature working

win, we'll don't So worry.

Puneet Souda

number, we the China this last current at the think what how could. you to now of in in that And great how obviously I before? just Thank long-term, there you. about sustainability do China one of scale year? do terms XXX couldn't really you million You Got but can quickly growth about but And should should highlighted, it. on in we see if just China? strong versus think

Chuck Kummeth

We're over not it saying and boat.

inventory. So

it's grow China So goal can. as forever that's And can more the We in of rate a my in. years being in ship The getting much talked this We And to they much XX%. good earnings can XX% as We my about - to and It's ship told growth over sell. is impossible as they that for need company. we've it roughly there sell we've growth thing. as - you call is in about over to consistently, it's China. this just than XXth my today been remind just hard. here rate

also all knock is ecstatic that out and now we're But of are So just Big our regions. park the it it's we cylinders in just instrumentation just flying. part it. of

all on we're cylinders. So

levels. We our are inventory increasing

they chain schedules. issues quarter supply shipment We help them problems. we're that trying and all the supply We're on have at looking about need. talking didn't are Everyone's going giving last work forward. any We to

wood safely trying it's can. we great on careful this We when out just but future. we're at I would growth future, a broad SPD pretty is a we way. haven't had XX, better, one I the It's be as have there. say just knock now, it's start any we year for And to strong you us in looks be year, which XX% love in at always over would said better to good sign or XX, this XX we've good XX. of to see for growth by based. And the XX. had but or China, as It small, to date, won't was the

Puneet Souda

helpful super Great, Chuck. Thanks.

Chuck Kummeth

numbers this peer seen China. so having far, think in any don't I I've as great good

definitely to we're antibodies, sharing taking see. is we're And in areas. So the which right great

Puneet Souda

Thanks. Great, the growth congrats on there.

Operator

is next proceed Our Dan with Stifel. with Arias question your Please question. from

Dan Arias

the think about for Western sort what's attracting And at questions. relative half talk system should how portfolio, of look love than then you can about on there Thanks the growth when take the curious Biologics utilization first where Simple guys. that per calendar more year? just . Plex, looks Chuck, like instrument to pull this of It you hear think you year. for Good instrument the in to easier on I'm morning like Plex, it's your quarter to envision and through we but I'd Simple if anywhere feels consumables Simple the

Chuck Kummeth

You're way, congrats. right, the And by Dan.

predictions quarter I our like for within think are X%. your

So - you often using be staff more but on our we maybe, should

Dan Arias

I couldn't agree more Chuck.

Chuck Kummeth

Flex the is Simple of bunch. the Yeah. lumpiness

Plex, system, Now it's Biologics, roughly cartridge to assay. use customer we through made customers on per less, XX figure start to have and the for we instrument have we Simple Simple Western, open their some it's pull a an it's especially $XX,XXX a on which on cartridge, out closed is huge. XX the This

So growth makes in actually lumpier it had XX% by instruments that We this quarter. definition. that over

we're for with getting all instrument track And So deployment. on through, pull it's out kind of about there. boxes that well

coming one thing. So we're off huge from just a very is It's bullish. year comp last

studied So sitting We're that. we pretty good. all

studies. think, I the a large of in lot of use

of so cartridge and very lumpy. what - instruments the And then it the some some that's large of makes orders get somewhat

quarter, front. XX%. And finish quarter. us whole back still turnaround to new this down every a sudden, much of right to in from have, the was road the just against of really XX% we're XX%, wasn't trying out the because to we've rail having a growth. growth much instrument different, instrument orders factory Arad. quarter our We're complete build didn't know, Because in cartridges could and all then we help next been So you It

be done a in year that. will We with

but cartridge strong fill I we've that's up last which did running. take And a of off got year. still back couple think XXX manufacturing and of up week, then forgiveness a this hopefully it's very will year-on-year. quarter last So We

It's more full So size the things And them and over ahead. still better run there. $XX steam of traction out on aside, million rate a or now than all gaining probably and we're half it's plus Quanterix. think others I

Dan Arias

the sounds Yeah, right. comps Jim, at about I I'm correctly, right? confidence Investor the getting getting thinking in comments All if okay. obviously that helpful. you it talked XX% Day, the you the And Thank above but that are that then you're that your is last hearing you. That's on, like And is higher. you're out alluded the calling harder, historical number believe is outlook average the about to on that average

Jim Hippel

correct. That is

Dan Arias

a thanks Okay, bunch.

Jim Hippel

Dan. Thanks,

Operator

Our from question. your with Johnson next Please of Stephens. question Jacob is proceed

Jacob Johnson

a something some up changed pickup there in just gene and good put end your quarter, from there. a kind in an chuck Or opportunity you the think I clear GMP? seems others this you this Is you've and that efforts cell kind on that's saw internal therapy activity Maybe for market of quarter. Hey, was lot it side, and function markets end of of end performance But of like morning. and some yourself, the market? initiatives that the been that maybe

Chuck Kummeth

Yeah.

I can that. think critical so. Yeah, I answer fashioned plain old mass. It's

bigger bigger. So this is getting and

tsunami the all to yet and they're size going and we be hallway think of, doing and the aren't already of to agents four but their solutions for visibility stay past or a this, are I word it's there the is it's better more and top And are on be is it's that years. and be market. this, even It's this getting just I've hard out in Our pregame within embedded sizable. couple to size, to partners a getting I ready in ups mentioned more scale and this clinicals. orders The the better mean, warm up providing two, going just just more preclinicals of our three, to to in additional reorders. more we're clinicals, going five traction,

lot this us past - in or in the for gene we've to it We million like being therapy don't or we've the dramatically future than that. flywheel stops of larger cell here the be division so, about five and So got our talked might catching XX XXX years, doing workflow. and total workflow, we're see with up people on doing of a in

I we as position, to being are think proteins, off our course, on have everything customers and the then to and unstoppable. all in nearly expect leader fully able else the we're who a we amazed things world, lead GMP we And the going to follow be of are first, at that with already. capitalize protein

but as of factory they customer, stop now and tour call full and our a audit, audit away. a were I it's our portfolio. So blown We one new it shop partial a a wouldn't great had first

Jacob Johnson

that about follow to me cell well? capabilities? to and therapy seems Got just efforts it. today. maybe guess, that sense. inorganic to That makes organically got gene adding do to talk there up add you Can at on that point. thoughts natural capabilities some thoughts your the But The potential and you as maybe on you guess you've probably to it have Chuck, I I like the

Chuck Kummeth

cell NK. side, to antibody Well, just the medium. we're going are to We're out. there's of I build looking launch continue talked T beyond the and think definitely about We the

So just in the expansion side. there's a of lot therapeutic

shape. type to over instrumentation wise, for and therapy. Simple being call in We've as think of revenue a great in we're quarter expected. cell QC purity Maurice And Plex be $X designed this applications going gene I and amazing. It's million of into is used had

will point have lot a that everything. have mean, the future part this ubiquitous. There, we're at do not got be an partner using we we've So use trying non-viral of we're there. don't of going to electroporation we're I kind electroporation. We

our but an than there's area. out be have one We That'd there. more favorites,

I spatial think for there's room more always interrogation.

think side with sides. that, into we we I think the right but can of used, And have automation, get I QC that'll production be probably scope. RNA the

Fresenius, we we new Wilson covered and there's a few fronts. we're it all lot competition from which hundreds looking like So on and a at. out who partners of the platform cube the customers But bioreactors great does have spots with got think of Wolf

and millions. be amazing just I going we'll not revenue talking hundreds a hopefully years, future to think it's few about of billions be an in in

Jacob Johnson

Thanks, leave on Chuck. I'll point. that it Alright,

Operator

of question. from with Our Alex is Nowak next Please Craig-Hallum. question your proceed

Alex Nowak

of the everyone. slowdown as hearing the these to as are what Great. life a Good thinking next China we budgets end budget about specifically morning, are year reached reason strong the ever? US as science you year, calendar any beyond Chuck, Europe and suspect

Chuck Kummeth

an warehouse seen Europe going us. country to growth to savings new kind We're entirely We're be of tax that hearing by other opening and We're be numbers, Dublin. good the mean, through We're seems over changes facility yet. Europe will country. help in forward negative probably not mainland you type working up some of XX% anything saw really I all the stuff. Brexit

spend well, for looks hell in. growing And for on dramatically about Japan fronts charts. is all a is except just so couple years, back their in India. next numbers into a now good Asia should still plan, China on of in we'll big the be which India, of talked Southeast is while. And again, second track stable. here, good spending they're they're been the really Korea's really off we is We're better going Asia with five even kind trouble China's the year in than see. year big it China. the it's

Alex Nowak

changes the Eco Abby team ExosomeDx TRU. kid McManus recommended this that's unit, to pipeline or - or Asuragen just the good. Matt focus? diagnostics upcoming then has new you the him that sales any ExosomeDx. business the been or Yeah, him to now has either strategy And tests the And changes the any push to Any molecular with now had those under through really

Chuck Kummeth

one which mentioned regulatory provide mentioned CLIA they incredible labs, as us mean, I have they on too. as No, really one saw saw Not side well to you you kidding, that and not because us the for help

that partners. the You saw is so implying mention really us excellence, of center

one to other some So going And we're we're call be different to going them ourselves going parallel because to to partners a tests, on is other and platform more pony. in doing channels. be this lot indications, a focus be with going trick able we're and not a

those forming And guy. new about, are and right these the think it's going ones well negotiations, all of lot happen. relationships in I and to of There's amazing be So and interest talking things we're underway a those that's future.

Alex Nowak

to chain, to stuff level you? at via I that's slowdown that But And thus, and slowdown obviously anything customers. labor is and cause to getting would push there I it. get a No, basic up guess customers the your supply shore maybe on understand customer your the the boat you're shipping not materials, see

Chuck Kummeth

seeing Well, we'd growth, up. It's growth few see. for we've first. But labor, which XX% made has last We're sure. And I been got in killer - the quarters, game plus we been we've hiring. that think love improvements. keep to in seeing in some to we've here our biggest made stay We've catching issue on the

In early word cars terms put here, making of not we're right. we out and on supplies, the

chain So it's a issues, aren't complicated. that supply

it's going into, Well, of like I certain something instrumentation, we've XXXXs. making a see think that? year, are to again chip we're looked per not we Our or a hundreds shortage instrument

in either. too instruments, tools great that are these million are deal. roughly to dollar that not it's a So big These not $XX,XXX, range. And $XXX,XXX are productivity

we're problem to promise mean, things chassis better no everything mundane getting problem staying next we and quarter. I if is it's All won't And last on else, had doable. and everything whenever, you but we a ease Not it. can a see paint see. say can But don't So issue labels this we say quarter. we'll foresee we quarter there's start don't and things like

Jim Hippel

sales Chuck, our we our year-over-year. were about is the of on eye XX% from an one add our reagents, core of if perspective, we antibodies I proteins, daily customers' could things our talked keep reagents. up And

of the our down. that's in a issues any so going supply customers are doesn't slowing labs, good chain indication appear activity that's So them it on though as

Alex Nowak

it. appreciate you Thank great. That's

Operator

Please question with Schulte proceed Baird. is next of Our question. Catherine from your

Catherine Schulte

decision for congrats there? I the first Exo versus your on a Hey, quarter questions. to then it thanks your the and 'XX. And commercialize guys, whether the have partner on TRU, previous you'll test target you on been finding in on had calendar a believe Is launch year made own

if that So plan what's the is delay there? not the still and driving

Chuck Kummeth

be year. to close going to calendar it's Yeah,

wise commit have all so the to is I anyone's really I regulatory working comes to NGS, with and LET which it's isn't it it's mean, there possible. to we now down think guess. anything

now. kind So to There's a all being study written have data is go. ready of we collected. we're The second the - been

need than data we're we So running on launch. to often more

front, partnership lot of been there's the On a interest.

business So we're the interest waiting through good as of could we're kind stay what here and kind from honest, us well seeing but wise, tuned. happen, it but chance of, makes be strategically, as sense to

Catherine Schulte

we've the the seen but and years, pharma biotech couple months. over financing we talked business you of in funding the volatility life side few the then last a science biotech but if And of think for research, robust government over about some last in bit about funding

on that your much for driven the is biotech what's by of financing we And market? outlook side? what end that So see how

Chuck Kummeth

was that's by quarters. quarter. And previous It tremendous a followed been up tremendous

general, because opportunities by makers everything a big of all roughly we're of all bioteches it's biotech, think, demand. that on We in investment biopharma we had COVID. been than there's good proof have But work levels and all that those coming further vaccine flat of in creating stuff off to there's and fundamental I XX% participating more that halo don't in from mean, of lot you than I it's growth us. all the is antibodies doesn't for been strong. proteins that, more just the and businesses, you any it's get food - chain look so funding

Catherine Schulte

thank you. Great,

Chuck Kummeth

I should make to a that. comment

traffic our increases. work pretty digital In are our our systems on and brand to taking why just had Novus traffic share. antibody XX% That's channels brand That's websites. XX% really We products our continuing in Our in also had amazing. work we're well. alone. year-on-year strategies increases year-over-year over We our premier R&D

Operator

with question. proceed is of question from Citi. Patrick your next Donnelly Our Please

Patrick Donnelly

of work pieces for Chuck, on labor, we was a make over et you touched again, and some of some the price the rising year wondering just that. kind of the you could costs, the guys, thanks through of between want questions. pushing obviously, moving side, again, just cetera. to you inflationary through some customers guys talk the sure on I margin if pressures, the taking bit Jim, little then to Hey, Exo that of the we as through rest the talk

Jim Hippel

Yeah.

increases. through it, that On manage trying as as of the combination of well inflationary to selected aspect price productivity we're

margin necessarily So of a result as forecasting pressure that. not we're the

fiscal quarter, expected we for 'XX. talked a when We view sequential our that margins. initially, recall, margin the I You last to hit said may about

for had roughly And was strategic And make year. around acquisition hiring. due didn't point of to the Asuragen given QX. going the I go And think we to first point in We than of up better as didn't a percentage hire we a we that will be we I up half we and think our much And getting QX. us some in messaged would therefore, the caught for thought margin roughly catch growth. to as was did hiring planned. - impact percentage that in due internally successes we our it actually,

roughly message end think I get result other we half the get two margin rapidly I the as you point to by that So to of the comparable. year-over-year that year-over-year as expecting and a the in second the of we'll that by be surgeon the to think we're of percentage and a investments, same of as of the last one pretty with then recover so strategic of point of a growth result that'll the to down half we is we the time the year, be at fiscal first start QX, our left points, quarter end end the time this one year, -

Patrick Donnelly

Exo Okay, reps hear about the to recovery - on sales able that's the like docs. side, are Where get encouraging to there, Chuck, volume get the it's the And helpful. seems then just into lifts, in hopefully we on through I are that terms the the do from to you again, as want pandemic you think are customers, hearing just What front? expectations recovery? you of there talk

Chuck Kummeth

one this docs with fiscal back it's especially quarter. year rate. Well, quarter, about had mean, we're fast, already thirds year, and I XXXX. order two coming last this And XXXX this we over reorder a on year-to-date,

And the docs, it's reps seeing really get tests. it's simple. to we them it's the are just got that like have PSA orders, more just that hard in. back up touch, seeing the being be customer picking to reps steam. If patients the getting from and And aren't that So really see

something there's about. to So talk

all pretty So it's back coming quickly.

out So XX,XXX I XX,XXX, It's there's here. there. started. really just early we're like think getting still docs innings And in different

So we've been we've really XX%. addressed like

leverage as doing we're getting it's a going going really matter good job and are there's and of helping a Matt team So lot and of, And which be there. imagine just to it well. a dilution,

Exo that team technology really the stay way can McManus just discussions a cell and do. Got probably to We're more So an we're we in its come DNA there the improvement is doing already are bunch TRU by on also tuned. quarter more than more it's predictive that's in free a part amazing excited. ramping one upstream. and way of taking and And but out ready over,

Patrick Donnelly

Great, thanks, Chuck.

Operator

is [Operator Markets. Instructions] Our question Paul with KeyBanc Knight next of Please question. from proceed Capital your

Paul Knight

will see call you think customers protein maturity be? average your when you do the facility. let's at it Chuck, production What gain, GMP size

Chuck Kummeth

customer? a For

Paul Knight

Yeah.

Chuck Kummeth

you tell can now, hard to forecast. for it's I them right Well,

of our in And percentages. terms contracting so we've done

which place, So quite a put in few the at this point. deals are we

to always go of critical and to in XX% and backup are is volume come annualized requirements a clinicals into beyond going This have and to with from couple need. well. to as that's get get a year a the we're we they some get backups such between area. way production, they $XX As before the receive probably for But over per they contracted going started range they Most with million all protein XX of good. us the million. They're

of course clinicals forecasts, their sales is meeting magnitude surviving their for Of REO, through and is right. orders and this of them but beyond for this proteins getting course,

honest. you'll production to anything therapeutic than So million be for less protein, $X see in of probably I think per a a don't

Paul Knight

is starting what, Chuck? at cost these preclinical And out

Chuck Kummeth

at Most looked partners. a of preclinical, these this being are we're of at scale dozen our in, by at clinical we're ready we're in at couple but some point,

they're well actually the there there if reconstituted putting proteins becoming bioreactors encapsulated, and out from a Wolf couple just their in de choose deliver go you talking pressure ready in clinicals. accounts it's already them over be facto example, from in the XXX we an Bio-Techne, customers a about, to As different standard, bioreactor. to out can And

a for lighting off eyes bunch of risk, cost are bunch you. table So up. and a And their it takes of the

that's a have getting it'll ready. kind But that of going, process we're year by opportunity scale the or we of take part So two. being

Paul Knight

read feel mRNA see Number market? candidates, success? what's of or customer since Okay. And we've interest, vaccine whatever then on COVID you the had, the your metric obviously

Chuck Kummeth

are Well, mRNA, there'd if going be drugs at they are different land right. use to working on you that Moderna, XX

- been they've they've right a great IP the and Cap they've place and at to right technology got the get wise, product time premier landed great a around. in good have So

mRNA some in level. on these this is tougher science we're So the be I couple probably working for of read at that's stuff down plasmids our all per out think rest But se. a rocket years, we'll in all there It's is not then alley.

So a it's of going. investment matter just in

get the another were would But would talking and same IP vision the Now, that take size first, right. need we science to we get of to with we'll proteins, we some we kind investment. what have mRNA the we first factory need so large things products in do do. now, we're if We'll and to make about working have we the then to sure have around it

Paul Knight

Yeah, okay, thanks.

Operator

closing the We have over I for session. question-and-answer Chuck now reached Kummeth the will back turn end of the call to remarks.

Chuck Kummeth

hopefully keep and I'm as as can all everyone. quarter well. year. going. It thanks, Bye. seeing do you organic look forward Well, next we was start Love to great our to a over XX% it growth Thanks always. sure We again.

Operator

today's concludes conference. This

may Have You you your disconnect your day. great participation. a for lines this time. Thank at

Bio-Techne (TECH) 2 Nov 212022 Q1 Earnings call transcript