TECH - Earnings call transcript Q2 2022

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Operator

Good morning, and welcome to the Bio-Techne Earnings Conference Call for the Second Quarter of Fiscal Year 2022. [Operator Instructions] 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.

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

Before we begin, let me briefly cover our safe harbor statement.

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

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

Chuck Kummeth

last and quarter good call. The Thanks, conference for global executed once again continuing high for team growth the quarter morning, our an us milestone XX-month level, you Dave last at history. second Bio-Techne QX a fiscal and year. important our first trailing billion We revenue the as everyone. crossed our for $X Thank XX-year company's strategy the during exceeded the from in momentum time joining

our products grew of accelerate, our market gene user quarter proteins and second unique end this positioning continues high-quality portfolio XX% growth solutions, XX% Our north and customers of to self our XXX%. especially robust rate therapy with continued biopharma, and growing the end for GMP analytical reflects Within over base. biopharma with within demand

advance better and solutions and biomarkers of cell gene the therapy, impact biology, well innovative genetic patient of discoveries, and currently underway next-generation extremely develop to of and and delivered to enable facial as the was points This increased remain therapies drive and focus profitability enable incredibly basis therapeutics. scientists team continue on transformative driving like again necessary our as and proud portfolio QX I'm diagnostics technologies sequentially of adjusted that margin care research diagnostics and XX XX.X%. transformative and operating emergence once to a Our proteomic reagents, with in outcomes. to innovative ultimately technologies biologics our revolution positioned performance tools

our capital the remains pace high continue challenging, the current our of demand programs we remains to people in meet of organization talented make to levels human to support at for businesses. in all own adding future and While customer our demand each hiring growth and progress our

open the technical we During and our key commercial quarter, filled organizations. within several positions

growth and bonuses, leveraging in referral recognition fairs have level talent. attract most industry best be Human Will past Inc. Brenda as senior and over QX. Bio-Techne contributions retiring into like led our retain large Apple. at XX large transitioning of companies new of organizations, utilizing Resources, Brenda QX. the for HR be in career both are Will be made Dave Struan Brenda culture Robertson, who to years of functions Magazine's will including I'm extensive at and Vice also The Will the remainder experience eight the role and Geist business multiple created by will from of awards I the leadership is leading our to transitioning of into will decade with Struan At renew Bio-Techne's units It retiring as to great successfully have our role and team. the success. retirement. in him is recent employees leadership attract to to Prior our his Quanterix. is in well to company, list enabled to the best and of pleased And businesses such President lead Protein Dave largely most served new immeasurable. running of Thermo due our strong wish to talent Enzer who our recently Will’s been on that, Officer X,XXX positions the President Chief our a Senior in that legacy Scientific. held has have for Struan from years Fisher Sciences company Everson all new dynamic inaugural join We Dave as very and Operating

markets. territories and also for delivered led growth some to behind global another across team again was experienced the business with get of above quarter, around growth regions the performance let's and Now specifics with China Close the the where portfolio. in all spectacular XX% strength Europe the the north end organic Bio-Techne's US XX%. We yet quarter mid-teens. of our starting of once

occurred mentioned of funding earlier, bulk I slowing and as over very we by was QX, do clarity strong it don't quarters, for market momentum Omicron-induced shutdowns driven academic this been lack has BioPharma holidays than BioPharma, a that growth down. where lower to growth impacted the orders. As many and was larger Similar significantly see

size However, rate from the academic year finally reagent customers academic passed the and growth gradually accelerate the will indicating healthy most the We strong is remainder for a relative budget quarter, our as research of of academic in Congress. the low daily underlying peaks environment. and calendar run demand Omicron was anticipate spending the this

where in performance our XX% the of Protein with growth organic quarter. starting Sciences, the delivered growth of discuss we let's platforms, Now

I cell tools, the continue in As solutions my to improve analytical acceptance mentioned to opening gene reagents therapy the of innovative within and experience workflow. we efficiencies and our broad comments,

quarter, manufacturing this from are the manufactured shipping customers commercial actively state-of-the-art initiated During our to availability protein and facility. of proteins, GMP now we in our site GMP

proteins over continue We demand the scaling anticipated first the proteins the in with of GMP highest GMP to this on GMP manufactured our number of facility, within catalog expand protein. will focusing XX

extends growth. and our serum cell GMP beyond for far However, and business and proteins cell therapy media gene includes

as Our non-viral cloud technology technology. as well gene editing separation our polymer-B-cell

are products, uptake proteomic experiencing to a including tools therapy halo franchises. our addition analytical biology cell, Bio-Techne and core spatial our other we several gene In effect cell with on product lines, our and

continue struck St. efforts. this we Wolf rapidly an explore therapy cell to investment to Minnesota-based future also with Wilson opportunities to We expand December, addition growing company. eventual of our gene for and acquisition In agreement in and external our offering a organic Paul,

year million revenue trailing or million for an or EBITDA background, cell leading fully and has EBITDA. industry in therapy As very million milestones to additional Wolf billion. culture of Wolf not device, in these trailing of line, by in Wolf upon a to devices right Wilson $XX each and the billion, product $XX gene cell XX-month cell X.X investment calendar set the total manufactures cell acquisition Wolf right Bio-Techne $XXX with include in single-use requiring immune upon for. $X.XX to by price rapid reached agreement is XX-month key Bio-Techne to company XX% purchase which scale culture Wilson quickly Wilson revenue Terms revenue. $X fit times representing a of bioreactors ownership growth. million are input Wilson of followed end the GRx synergistic for the XXXX, the This a agreement adoption has proteins the enjoyed a GMP make If an achieving is at $XXX a a a GRx multiple acquire is is becoming standard with

greater joint Wilson Kabi, and with annualized scale-ready reminder, venture. revenue already Wilson is $XX a Wolf growing partners than Wolf biotech Fresenius gene are Today, cell rapidly. in along million a therapy As and

the to of looking milestones off team. them around eyes are official With and opportunities, We core our and our RUO their and of all members taken excitement forward ball gene the the company, becoming hitting proteins haven't therapy eventually antibodies. the Bio-Techne cell we of

antibody businesses protein quarter. growing to research double-digits Our continued extremely well, only core in use the perform

Our of Systems quality, delivering as industry-leading portfolio bioactivity broad highest level proteins widely is catalog the and RUO lot-to-lot of our the with R&D brand recognized consistency.

created catalog over ago research have than category hundred we cytokines use a time fact, Bio-Techne. several proteins including XX more that of In are frame, a to over and amassed this exclusive of years X,XXX

Our into positions offering high-throughput adjacent development mRNA broadly emerging opportunities creates both and applications, and expertise and in engineered plasma including antibodies and proteomics Bio-Techne DNA proteins in-house manufacturing. us including participate to broad opportunities, of in the possibly expand to for proteins

cell the delivered solutions, all over Moving testing our AAV purity Recall immunoassay instruments, growing led characterize on namely instruments XX% Biologics and portfolio and and charge instrument once increased therapy Western biologics ability in and portfolio to novel capsid with analytical where robust once gene the across bioprocessing. way, year-over-year. enabling applications proteins and and XX% of the again our branded XX% proteomic enable grew stability testing. also identity Simple our the proteins again traction north Simple serotype Plex Maurice team ProteinSimple gaining identification, of leading Biologics, Maurice growth of is its analysis platform, our quarter. as to our tools, in

multiplexing the push to of Simple Western cell biopharma an messy, to button detection fluorescence therapy, also of great into of applications deliver launch medicine, three-hour gene-modified detection of regenerative targets, a Western multiple continues including Western Simple as solution, the process to Simple models alongside lane. stellar traction blotting resonate, gene system process cumbersome for and particularly continue with using full therapy protein and multicolor within Western of our stem Stellar the a unreliable research low the a we ability accurate gain abundance just empty capsid vector automated for the total cell gene enhancements on staining enable and community is identification, continues Western and detection blood its with western testing, the fully purity Simple viral customers. same cell Our to significant gaining this is acceptance recent therapy within detection. immunoassays and proteins convert customers for highly The all platform. our NIR/IR modules example versus therapy manual

now availability commercial fluorescence luminescence of offers Stellar channels. just sensitivity picogram chemical the and Following both low modules, in

also assay being the to the impurities. opportunity cell and wholesale-related Ella for with neurological its assays layer For potential. additional map remains stages biomarkers, applications road and demand reaching very experiencing instrument onto the with detect in Simple clinical are increasingly and untapped development believe gene assay The Ella the pipeline, gene the we Ella, immuno-oncology Plex, in full rich early of we in therapy increased cell this pipeline, therapy, and remains bioprocessing used

the and Now X% increased quarter. let's discuss organic the segment, Diagnostics where revenue for Genomics

increased branded quarter. spatial the business, XX% in Our biology ACD,

key exposure improvement QX. was and market While headwinds a open by this up long-term year-over-year same is QX, was a remain over commercial nice All a our in which impacted academic positions, to comp. softer not growth tougher higher those a expectations, to it

commercial some expect However, improves. members of filling new make the commercial in we and positions did progress as in environment team on the academic continued progress rates growth open and board for

capabilities. RNA our we targets reminder, portfolio spatial quantification the higher visualization for kits recent adding of as biology a scope, short quarters, As well have as RNA over plexing RNA and microRNA, expanded beyond DNA,

very traction fusion. of are to market with short circular with kit for XX school, and RNA variance XXX gene to base We splice encouraged the detection are also the a targets, continued the basis, experiencing of we detection RNA enabling

This for Our therapy Cell and that probes of cells. accelerate also diagnostic to fellow now of scope protein gene imaging uptake system. signatures, business being our demonstrating RNA targets the than cell new stratification on menu to health have understanding potential market genes ACD spatial run in this treatment ultimately with new with the multiomic and with assays many Akoya announced in growing platform. complex workflow is to and determine RNA publications VX cellular species Biosciences, Akoya's improve nonexclusive phenocyclar assay biology environment in interest patient spatial imaging interest single XXXX, cancer, therapeutic almost Akoya's of crossed has used improve partnership pairing and recently biology biomarker unlock fusion greater our a like over quantity a of scientific XX,XXX been We for and spatial diseases company, HiPlex gene track has outcomes. the human

HiPlex about by the excited assay partnership. RNAscope enabled are the Akoya the We VX automation of

Moving our diagnostics other of molecular on our diagnostics to genomics parts within portfolio and division.

test continued volumes have volumes test followers, improvement the for pre-pandemic testing a led and cancer cancer quarter, diagnostic or doctors make double strong continued progress by we begin returning patients strong to for prostate to as returned to volumes. digits ExoDx ExoDx to year-over-year test checkups prostate as in to routine QX. Our increase QX in the

prostate ExoTRU rejection kidney ExoDx advance to the of pipeline exosome-based assay, noninvasive In continue diagnostic tests, our to our we innovative including Kidney. transplant addition test,

patients that ExoTRU assay reminder, noninvasive health in urine-based patient provides to care. is decision-making a transplant As allograft information clinician kidney biopsy critical, a assist liquid optimizing multigene managing in

the regards We gain for legacy genetic with diagnostic ExoTRU surgeon continue BCR-ABL on steps continue to on our to launch, focusing to commercial FMRX commercial products, prepare portfolio for and products from the kits partners with oncology traction. own. for including leading work With the discussions a dual our of and potential business, potential pathway market commercialization to molecular and taking our

During AMPODEX-PCRC-CFTR offering than the kit assay. the fibrosis research-use-only the variants the disease by This coverage any quarter, CFTR Cystic is genetic life-limiting in of gene. of we commercially kit. available strengthened autosomal targeted the with our other caused kit broader diverse recessive launch a US testing population provides CFTR

conclusion, its Finally, position headwinds for single recent and the trends test our volumes, diagnostic revenue In reagents, lines. Improving the that blood diminish, favorable demand upper global of diagnostic quarter office business research this combined continued quarters are end with remain doctor product our growth tenth from our tools in QX experienced The launches gas business the increasing forward. chemistry, the the as penetration visit in execution and control consecutive team, new favorable proteomic reacceleration customers, trends Diagnostics with for additional in existing in hematology products pandemic-related portfolio strong. analytical we we market conditions OEM Reagents going delivered sustainable continue business impacted and resulting molecular in recent and product quarters robust within and to organic digits. experiencing and a this growth,

with Our translating products branded our protein cell are for GMP gene analytical cell resonating and are increasing and solutions. portfolio, particularly into across and culture for demand therapy media proteins, demand There's proteomic initiatives biopharma our our customers. simple our

purchase target agreement, billion sights confident signing and over Jim. even exceed hitting to We deliver goal. the I'm this our Wolf in firmly hand XXXX on I'll ability call of more our Wilson our have and With potentially the that, following focused revenue $X to the

Jim Hippel

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

the impacted than for other in operations, organic a negatively GAAP in EPS ChemoCentryx. business growth. contributed mid-teens was of the for was year-over-year strong, performance EPS, X%, EMEA an biopharma from unrealized market, very From the exchange $X.XX gains was XX% basis geographic the translation biggest $X.XX $X.XX. a to impact The remained on and had million, an immaterial and we the world Academia foreign investment basis. the revenue on XX%, Acquisitions in increased rest a on year-over-year. in Foreign growing experienced the to in compared and prior increase perspective, while revenue quarter. exchange quarter strong US XX% by GAAP year. XX% QX grew of balanced increase reported end the with our China and growing an $XXX.X and EPS for driver low-single-digits By increasing The upper-single-digits. over

XX.X% Adjusted of for over increase was an period to operating XX.X% volume gross growth. XX by the XX well decrease as acquisition support last the The but - increase fourth basis an year. P&L. in increase resulting was sorry, in prior The the revenue was long-term due the the a the was mix. the primarily SG&A surgeon basis adjusted our of to quarter and of as points year year, QX leverage XX.X% on of QX. driven compared prior in in and XX.X% points Total segment in quarter prior was to in margin from margin in prior made the while of R&D was to R&D The the SG&A details company of in of revenue, favorable Moving to of QX adjusted investments a compared I'm XX.X%, X.X% year with line increase expense year. QX strategic

adjusted Excluding line operating of the was prior with Asuragen impact the acquisition year. April, last made in margin the

compared year. operating at debt. to numbers the our QX continued below of $X.X million bank Looking prior was million, interest reduction our net was income, due to in decrease decreasing expense The a $X.X

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

includes tax investment other down from GAAP gains income effective ChemoCentryx. For our rate in the non-operating our unrealized was Further reporting, adjusted XX.X%. in P&L, QX

was net the Turning to quarter, $XX.X and of and the XX.X shares our in flow prior In shareholders million operations QX, dividends. million finished $XXX generated in diluted capital investment cash return cash million in million quarter way $XX.X QX, a buybacks $XX.X outstanding. million million, of and quarter. capital. in capital we from average expenditures the We to stock of was during $XX.X to by compared with in year returned

in Our balance and in to net strong sheet very short-term available-for-sale $XXX finished million investments, position our a position with QX bringing cash zero. debt near

of the Next, Within both QX compared broad-based million, growth reported year. XX% reported very Sciences all Protein sales to starting in revenue, $XXX performance nearly this assay segment. with the increasing strong with discuss inorganic reporting I'll instrument the were the and our segments, was platforms. segment, prior

timing the future for more Protein As leverage GMP grew Biologics low volume XXX% including of growth. offset therapy and Simple Chuck and points almost investments over products, a Western antibodies support mentioned, XX% strategic growth and all Simple year-over-year due over increased Plex cell was double-digits. favorable grew XX%, over in to increased Sciences both the basis of Operating decrease segment XX.X%, proteins to while our XX%, and protein than margin gene of primarily XXX by

acquisitions for growth increased the upper Diagnostics the and portfolio revenue to year-over-year another sequentially, were segment XX%. million, double-digit achieving and sales was $XX.X growth QX biology spatial quarter. segment, single-digits, Genomics in reported improved The business the Turning with ACD-branded X%, XX%. Organic increasing contributing Diagnostics Reagents reported with

For by pharma, pre-pandemic growth compared the Diagnostics with was projects to companion prior Exosome surpassing the counts test almost improved revenue but timing importantly, of levels. hampered XX% big now cancer prostate period, diagnostic year

are sales community. return force gets for We continued patients with encouraged physicians more interaction trend to the their with and as our improvement anticipate checkups and physician in-person volume the

markets basis Moving The the XX.X%, to margin prior to summary, mix, product increased of and volume investments segment, impact to diagnostics growth. by reflects operating and improve. end leverage In continues the the impact future on end at the operating market partially strategic margin, compared strong segment's XXX offset year. favorable the of Diagnostics research-oriented increase the to and our Genomics points support remain

research QX our our in markets. analytic are we remain executing in serving performance shows, As demand, reagents high and these tools extremely and well

half the comps second increasingly the rebound COVID more before. from this occurred Our year become reflect fiscal the last they in year year the as massive of challenging that lows

rate However, that, our in prepared line my concludes fiscal to the achieve for confidence to organic overall Lisa the over given performance we half first strong of XXXX, have for And our That mid-teens comments. back open I'll call full XXXX. the fiscal growth turn the we during can the increasing questions. that an with

Operator

comes Our the Instructions] of SVB with Leerink. with question Souda Puneet from your line first [Operator question. proceed Please

Puneet Souda

thanks Chuck, for Hi, Jim, question. the taking

we growth to tougher already despite as clarify, year the within one, for on hiring the the somewhat Jim think to year really hiring - we So op wanted mid-teens and that throughout you side, covered here expect should how this given the the I that context? for first that's should how through just account performance I op margin really, expect Jim, hiring comps. delayed, of some margin the year been

Jim Hippel

it the into at the hiring less continue margin? of expect how translates been. said year or operating the the that beginning that more at We adjusted has pace But to We we margin of to the operating and we end see case. the at fiscal in QX expected being ended that same QX last relative the we year as still that that year,

about really So only we from where points XX higher that's basis QX. ended

towards So we that continued gradual see a mark.

Puneet Souda

a deployment, you And million capital wanted placed. new understand. you have Obviously, $XXX buyback to just that I on the

the to a takes through If buyback? has remain balancing Bio-Techne how you this traditionally, just I that the puts - understand But to year? you and that Given growth trying versus and just me continues could prioritized walk priority. are M&A, think

Chuck Kummeth

I'll take that, Puneet.

we'll never the been So two we've we never they're valuations public be to we've which gone tends dilution, eight XX, that. wait for and to do until Currently, this times and years, beyond months few still today, buybacks know with settling we even up But might in quite remain point, we've but very auctions, stock leverage. high. private to and XX more more they done getting doing things We've be minor. option tend been the able last them high, We've is acquisitions done but to. which for a And well smaller. never cheaper,

our anyway. especially was So that - we of it have stock the Board, an undervalued. given and since we make that price, we status probably we our or X We very never that message thought extra to thought feel X.X use was appropriate

So Jim some as here time work. It's do got something put pointed debt and - act and zero. we've to leverage out, we're net to

Puneet Souda

Got super it. helpful. That's

Chuck Kummeth

priority really probably - you to leverage plan, M& still us We that - X going is likely. A. changing not not our capital important our high times understand It's not we're but guys a X.X, on

still we've number room It's So here. one though. got

Puneet Souda

from and in overall we've the Okay. is a GMP proteins that - That sense. in about investors Thanks space. for demand the Yes. demand Chuck, makes acquisition in been that. question getting recent

cytokine acquisition there of one you As by saw, was GMP peers. larger of an your manufacturer

it GMP Given by proteins that to the business going of the likely peer. that scaling is be for interest appears that be valuation paid asset, to going and

market that wanted your do competitive that you as the position to in overall potential scaling competitor just well? one in market So you're the up with understand, and how Thanks. see demand seeing now

Chuck Kummeth

been very fourth out to they're list on the with hasn't work, we're fifth for That think up or ahead like we their starters. Well, and years date entity there.

two lot have trying expansion years, I of assets been been been Their in doing they mean, They haven't real issue. they've don't one has that's So place. the be for last much. a to slow. sold

quality, the drift be in has would over even drift in can't - they proteins of consistency, et like hundreds proteins and like GMP make. time RUO We towards have been the bioactivity, lot proteins think cetera. We

that even we're in we'll use already the able say, we that more these to I years We've as five and think proteins probably best industry, think nobody different things. well on think else for have positioned the uniquely have and in, even the industry more Wilson I position can we that matures the IL-XXs this or now. years this have make We years We're likely. to you go X, XX - going to been. Wolf for proteins than bioreactors four the IL-XXs, be get and strengthens been think just than people And again, proteins embedded beyond to can move position that solutions at be sterilely. because we'll full smarter

we're and workflow. a these cell not to concepts And whole help therapy have improve it's gene actually landlord for going going novel innovative to again, to guys, So the new them.

no So space knowledge they have domain beginning. in the

behind us, all are years to there but them they feel. money we with, have again, help So

Puneet Souda

it. Got

on questions. And Wolf Okay. the Super for deal, my Wilson Thanks congrats taking helpful. guys.

Chuck Kummeth

Thanks.

Operator

Thank you.

question the Please line comes Our with proceed Stifel. with your of question. next from Dan Arias

Dan Arias

for is GMP Good should that bulk sort an it Or menu? it's Or up lever about? just then or make now? Thanks of growth a more both, this sure I'm that? think question. ones driving like related months relatedly, I'm a many morning, so proteins critical XX-XX of bigger demand? but just are on is mean, I think about Is make proteins you looking when it last and it on point than the on your you curious the scaling for just more next that scaling each is diverse over expanding growth, for we the And that you guys. is there, XX one to how year? I'm factor the rule what's the Chuck, to important there the

Chuck Kummeth

for to in XX. question. a We went trying early started have protein. It's to beyond Yes. good GMP and largest breadth Thanks one. expand very the We the catalog

right We a a have embryonic dozen nascent demand very and There sold, that's XX, And that you're literally a to isn't being lot there's back moved are of since that about industry. XX. It's right, just roughly really now. it. and now made

launched the XX, got X are lots, the lot them is audited them having middle in of our in XX, three a have We These by selling verified coming. multiple first and totally IL-X, and consistency customers. also

have a soon. We vent coming

to lot fashion, that's that that's in for. It us, been So will. how everyone, and this so probably. I beyond And across board is ever RUO are which now an make for I after we And what deal size what matures workflow looking years, double us. multiple doubt the differentiate lot-to-lot we're they're how focus then on how in XX first I perfect. And plus XX, lots we're for, with come. an for these for consistency, we'll has where that's the probably RUO going in XX, at years - anyone first to year to known go doubt the to or what guess. that the will two industry is near extreme depend and at factory. to make course, big sizable we've the to think is that of going been. and how able The scale what and That's replicate level, we're good to to

at the far, can the blown our input lots of so And They're stellar. consistently customer have frankly, for the see a lot lots ability and audits of quality the and away, size been - what quite they we single in of assured that. millions clinicals, if a And near dollars they produce. that consistency. They we're to they come able into of to and protein do want buy out a perfect go they therapeutics, can be of

Dan Arias

Yes.

I pretty mean, us you with I were a slightly Okay, what I just trending rebound. you quarter, think little but this how bit help you I we looking ACD. you you saw on were the for. for, across quarter softer guess appreciate what which year? that of, than And just Last see in that. confident was maybe Can then had business a looking been

zone So, of help you number one, growth given one for the is wing force two, this quarter factors? saw our model, market of in just related how to landing And sales kind what you was us maybe then list the can like year, that much versus this the in of with segments?

Chuck Kummeth

Well, last we quarter, double-digits. we were were mid-single-digits and

for was when of and factor. So The near while. on a that of top like account that and that's softer. there is the comp that an taking XX% Omicron academic we academic an There's this into recovery, especially tenancy franchise. customers continuing was There to is lot a

rage, So, biggest the right - as this we're right? go and year biology is now. it out is rest the there a of business in sales the of and course, we then the all spatial force, through of last, There's lot

shape So, target. is in Bay - this quarter, back. We're the of guess pretty we've market bit especially And we've that covered I when is last comp in located up-and-comers had results half where reflect for also especially mentioned good mentioned a account had we've you kinds other little that area But Area, conditions. in even now. have Academia And that softer in some attrition. and take the that, of the same over still. business another

continued XX% always stand had year, of have still for We by this the that. is growth. of always periods brief XX% many XX% years. said a throughout XX% we've to we see rest improvements. we And the We've improvements, grower So, said and still

be I think we're way worried back and to to our not It's kind plan. of too that, on we're on honest.

Operator

Thank you.

from question. comes question Inc. Johnson proceed Please of Jacob with Stephens with next your Our the line

Jacob Johnson

opening I occur? in candidates X Are you cell media those comments, focus day? of so. proteins opportunity market. therapy your understandably think as and gene a for mentioned GMP and could manufacturing that lot And when serum an Chuck, on GMP and But

Chuck Kummeth

right expanding working Atlanta now. BME We're on facility our for

out the because We have and exploding we're growth of tripped business. leader of finding primarily so market is recently kind there,

We on expanding be We're probably GMP we're bit there. adjacency but regular the And that that workflow. putting and into we'll the parallel, proteins. little and over going do a proteins in here, online. getting to the some of GMP to factory But antibodies headquarters, that year, So, next at media current will GMP some see now now. yes, the a natural GMP probably GMP as probably part all be media

few - So you all facility type kind are can't just GMP to selling asking, - make We're scale GMP research we we the were we're itself. do do being proteins some. and doing are too? quarters, of last of in So our this It's Customers and in like years. why doing and have we this, asked.

scale to factory it room. we in put is GMP way the the So, our have to where

Jacob Johnson

of for last will Chuck. you allocation. public the do of see to year Obviously, maybe then that question think think do flowed and be the on are And act. as some maybe rise I going and markets. side? some Puneet's at seen in up Chuck, that out point on following would Thanks play think you And on ready result that more to private it's But interest rates you this? we've through a you come multiples - point, come you to some capital down this opportunities at you'll

Chuck Kummeth

Do you terms in of think M&A?

Jacob Johnson

in M&A. of Yes, terms

Chuck Kummeth

value. and going I I take price mean I no current think size matter is month every human. doubt company. - say of our versus Nobody where is are that's today what humans ago the will, their anyone a to of it

things come this deal your points the interest with is they that mean They're try shaving there. our multiple, have acquirers it affects upset new world it. with probably DCS to off rates to foolish anyway. And XX your probably effectively target. it the well, go yield, up, like The if settle then out wait deal their that going But probably too, be to have. we treasury aren't model that, the all we'll check But down, we'll always if as even just it affects knowing going So out. and it's

capitalize well. up I'm During forward There's of that It's money, believe rates, we're acquiring double-digit of well. we're this a - a quality don't-catch-a-falling-knife in scenario, a times our just people And carrying all know a get as lot - there's makes we little and bit price at a reasons a we'll of tag but company a of of ready M&A of kind interest. we will and There XX to a all this being that we're Trump, too. be growth, I interested me, So do company end flight was stable at lot for things we right? mean to is hoping unicorns. lot be - a to think and I X% better multiple. looking things were there as to X.X%, settle. Right now, in when winner still interest

anything want to add else? you do Jim, So

Jim Hippel

Yes.

with think M&A about I favorable do IPO the private might option what be being owners for big hasn't only might more been I going if thing market we're think viable a environment would the And it volatility twice now, other add the make and competitors of years make accessible. deal X.X that companies, our that that make a would this more anything, in IPO. is one been it's the particularly in experiencing past

Chuck Kummeth

into actually they've To had and inquiries more called honest, you an IPO said that potential be inbound some they were targets back. from

Operator

comes Patrick with with question the Citi. proceed Donnelly next Please of your line question. Our from

Patrick Donnelly

Thanks the demand, that. the a IPO of about high-growth how a you earlier GMP. just the pretty of growth about biopharma the areas. of some general people on feeling eye for your those kind on you're market, to sustainability really of things from Chuck, question. Analyst like demand areas obviously, mentioned more close like at biologic years maybe funding on Curious of questions some of and expand talked Obviously, keep strong taking kind the few Day, kind

conversations So just some confident curious, Or of do still those of all? really sustainability at from you if changed markets? feel strength have

Chuck Kummeth

Can time? better I feel growth I one ever. say more XXX%

Patrick Donnelly

Yes.

Chuck Kummeth

instruments gene to We inferred an kept incredible positioning AAV of the in gene XX%. exciting of applications. ground enough. is rest transcript, And way All all going we - off of specked - being our and the we're keep growing the the that It's lot we It's the TAMs well our beyond extra be And platforms and from gene isn't and a thing get specked cell saw actually. are therapy around are Biologics we're at can't - stuff. portfolio. can't We put the fast the this you you purity being killing continue being therapy beginning. in growth. applications cell our therapy it. most we're We're supposed digging, on in finding throttled the this happening? detail are and why up, cell used for X having the all these applications instruments and in for being

in So $X yes, you our guess was cell see of years. bigger we target And being and therapy. add it. for lot this revenue XXXX, what? when Wilson to the juggernaut gene a And there that out Wolf It's largest a component billion just gotten

So - beyond well then, by the too. take it's a roughly going billion or be company $X more which it could half be should to

we're the to definitely things coming, And ,yes. definitely going antibodies. do media. So We're new doing

because doing broad. more things We are pony-type antibodies in is these it's demand of right that the it's This have a one-trick areas years well. and more effect with than I did for starting - as approach. think we four all And ago being used more halo

We well. are affect give cell workflow the get, really quite Wilson and those have about in therapy. Both And we couldn't to and JV things gene channel the the doing Fresenius and created power XX entities of more us different of products then can that we working. it's the Wolf

Patrick Donnelly

spite been blackouts. talk speaking then maybe a things then and again, this dislocations again this maybe Can that minor some strength to That's China And Okay. quarter great of a Yes. continue And as even about just growth. in XX% for the helpful. throughout you the expectations for there? rolling next? guys, year again, over sustainable we spot with go like you has

Chuck Kummeth

at, it's some we and this the yes. there is repeat. for only $XXX It in it's - year, range, and going which We'll was think, our to rinse for company million XXXX, million XX% cross is $XXX great we're time. in China for China China. size XX%, be but is and that

that it's at company, or more. plus going when So $X as we're out a there billion to twice be

the the of and change the unless but blip, things, us. with before all Trump nothing to town. We're - and aren't just if too, be China the like I They I down see a stopping suppliers up stoppages didn't it long - game product and country going shuts term. And may local nothing the entire don't - locks in momentary there So era, stuff is only - there. geopolitical stuff, the the affect in growth

they're buy going continue do in want China, our going to So to stuff. to then have forward. research they'll they now knew They if that,

So no issues.

Patrick Donnelly

Okay. just That's a one helpful. on quick Maybe Exo. last

should... pre-pandemic on mentioned you side, and guess, quarters through, that's set at continuing the terms volumes, talk of You we board prostate coming the certainly there over just I in next Can to the catalyst encouraging. level ramp reimbursement payers what

Chuck Kummeth

sure. Yes,

total, like lives XX private and under million we're million payers. we're X So something for

private X/X away We're grind to purchasers. about seeing in repeat of payers. growth. continuing good our X,XXX-or-so We've urologists, we're touched which of So

way the So we're of through even out the of doctors one-third domain not the there.

issue. it's continual So a

now. and are We're our go seeing these ramp after. So expanding to we just starting results still to starting now without to sales force. We're get that

to Asuragen an have, and people effect. stay urologists. forget new know, after it's to on even a with got the new immediate a you've have We leadership, as going team fast to already got more on get putting you at in and with They be new place street purchasers. and But we repeat

total So XX,XXX sold. we tests are now across

sure, surprise bit it. little back we're a validated waiting this not drawing the with here platform. growth two before in don't that do it's, we're the have for all real got a have definitely that partnerships get blood able billion it seeing to on a NGS a we going board And so anyone become patients of the we've Omicron, have partnership. of a an starting actually ourselves. now. the it And get we're platform It's combination asks a to things are other for interest It's engines But that assays, to interest close ourselves. but one, again, yet. program. lot are I to reverse we in We're things ExoTRU And the We're the coming, with for very, very things to already And if strong not very shot, it's feel good we'll though. are And in entirely. we do wings talking one as very, others here. in $X or that now, very of a we lot a example. So and did way going and We

over in for it's Exo. best coming is the this and So year a quarter well

Patrick Donnelly

All right. Thanks those some to Chuck. Look announcements. of forward

Operator

Thank you.

Catherine Our your question. Schulte proceed from with of comes with question Baird. next the line Please

Catherine Schulte

just the Omicron the guess, that quantify questions. your for you're I has impact there? the academic And you Can seeing on on Thanks regional had on market. levels? any differences first activity comments end customer

Chuck Kummeth

a got I've question. very Yes. insightful

So we've double - to regions. ranged digit. flat the from on academic our it the isn't depends product. on depends had It It

and multiyear grants, some have We funded. They're there's fully accounts no academic are issue.

not, are they're and Some grants. waiting, and new waiting on they are

no but Christmas, They from there And was they budget company, no better doubt time because own people hard. home all back is pulling yet over back Some net-net and field It's a just back Omicron. everywhere. our people like and little last that, people dug and from back home we The our brought period we than significant We've answers of impact haven't come yet. because it the all send mid-single than send digits, are them longer roughly roughly a maybe like careful. again. in back got there's quarter, these they're all we've being

overall And macro regions then good. house So we're XX%. And environment that not are in passed And is budget of well. as It's pretty good the was worried. already the this looks is right? some on that top coming, the

XX% - You will add digits be and on get - be for - something top that's billion going the in $X to number. the million $X got they've you It's as it's double a great ARPA deadline, stuff where a and see. year late we'll it budget. to this but February we all getting done. and done Congress little a know, hear you've got But get We

any biopharma, going out academic is mitigating an biopharma by with result company of I than worked our hard swapping way So this from so, academia. totally It's This reason. are in segments And of this academic we'll forward. very uptick the we think start it’s now. smaller in effect the Even seeing risk. because design, we've

academia, quite not hopefully, to going it's - rest year, big be BAX, to concerned. few It's we not And we're everywhere snapback a forward, in think going months academia. deal, you'll And get improve I going or by at back the is get So of a summer there the normality to too see least here then personally. a off. and will big variance

Catherine Schulte

Sciences over that any or Okay, changes the in the got leadership? see there then And strategy taking Protein with it. Will in with change you segment, opportunities

Chuck Kummeth

one sparring knows there's know. strong got won't Dave's an has great and Well, edge them. the domain a knowledge, Will with Everyone Dave, in Dave you'll missed, pedigree. biology. He's there, thoroughly but all come as very He than miss I in them, to only not but we be with if stronger

spent couple great of individual understands right here start. retirement, California, in with us, long residing really He's that's still We weeks. looking the And few that but in a all quite I leadership a years and science for So search. been a He's way for just our critical the down. think and he's for up - found had Dave's here a I we them.

Catherine Schulte

Okay. you. Thank

Chuck Kummeth

do. changes all any made I'll be not It won't something they for have ask We long. yet.

Operator

you. Thank

proceed next the Alex Our Craig-Hallum with your from with comes line Capital question Please question. Group. of Nowak

Alex Nowak

business go the that Wolf, could we as you buy strong on what Just understand being of is. could that do how risk be? wrong company it all what direct On think to see out in guess But that from Wilson you're a bioreactor rocket figuring I business? ship track that I

Chuck Kummeth

type think, guy. who scientist is an you've of of I by Wilson, operations risk far, the KOL got R&D collaborator biggest is John more than an

level. tend to a million of that $XXX a not growing company him trouble run beyond finding So, getting partnership somewhere, these beyond the guys

ready already. street, they're scale already because JV right the integrated So down of they're

We've known for over a time been decade, since. I've ago. and So years ever friends Thermo XX tried Fisher first him buying

anywhere think, a already I XX thing he from this his have there don't - customers There clinical isn't remotely anything with annual out customer million over to has, over of purchases. of already even close of is that integration, level XXX, I base think I think, $X anybody.

it NK really, do wall cells So this? with and standard to things GRx to new gentle and It's about going the of cells Sure. it's the and works, thing Are there new beautiful the surface. Are it. stuff? there way to cats? going going doing the be really and there bags on de copycats? to crazy But be it's like T hard be copy there this people facto Are future. Are is ways

for people being. So aren't that going a just cells bioreactors well this in lot are very cells, they're and chasing NK for there technology of work fact with be simply to to going T -

So John years learned this ago.

he's got this, team. fail work We're It's head got They waiting a business. I've for with going team been And start. He's And here. crazy. to growing for our like a sure. be them years so it's not great great honest. - And a marvelous to let

we're So ecstatic.

Alex Nowak

saw And impairment then Eminence Yes. the just No, back in to going great. that's the P&L. China,

that a happened at the on what Just China of curious in impacts quarters? if couple next go or least there forward

Chuck Kummeth

Well, it's China.

going a two think lot picked big. to in this swing. looked Guess we We China. didn't and took walked know one. We wasn't other We of entities, cash We the a at what? have be stable. is away management was We management media from. We stable. The

definitely nice So it liquidation. it's it's going the spot There's at write-down. a a there. to park more We've do in not We It's all business a got point where loss. There's we're got immaterial. than covered, really the assets.

our we'll of and to what small at next responsible the regroup. all from are is later way just let step know we options we say with the go as the we're there assets. there's you and that But to this can - then need there's more see taking with we point, do impairment, that thing So

Alex Nowak

Okay.

Chuck Kummeth

Eminence, for As China. it has that So a Alex, we reminder, don't a from growth our on right? our China impact include in results material report anything

Operator

Rowe] Capital next from [Mike Instructions] line with KeyBanc [Operator proceed with your question. the Markets. question comes of Our Please

Unidentified Analyst

do there $XXX that have Wilson following to just up on of kind reach diligence, they Chuck, million Hi, that operations your in the the current think that and the capacity mean, expertise Wolf., the then level? due I you

Chuck Kummeth

couple give bought - over foot of for site. a bought - did dollar early square the year-and-a-half you asking a what that? He you a believe people, in he - site still Can XXX,XXX there on of a with it's out I decked just he wonderful its supply all-in, chain can a there’s facility positioning. airliners I he for you just the at they're park it's It's can wouldn't and for year, a space. empty supplies the beautiful. And - risk. his Even

at not we're all. worried So

I it multiples - crazy, of rate, had I guess get scale I think, if sure. know too revenue I but don't don't to would sure, for many want their I'm current to

Unidentified Analyst

just, following IL the what want, guess, a exactly And then what or I you other protein proteins. coming to GMP IL-X of up knowing IL-X, customers Are couple they around it's questions is? whether on there

Chuck Kummeth

Yes.

Unidentified Analyst

this process? are space, work the process? Or customers customers is protein it more given in best industry driving of a and their to with for experience consultative you And your other really the your in

Chuck Kummeth

Yes.

question. great Another

So therapy. here. going of gene a interest we as the talked our as we into mixed is answer lot and actually have well medicine lot regenerative products and a cell of - One, about are

So that collaborative very customer at site. our the is a effort with

work of going clinicals, And on type [Indiscernible] game. are other terms not one But the in doing we for I as So the proteins example. we're the kinds mentioned first of of well. T-cell classic is of

got clinicals, You've in up and, Meltani of we're And the right? coming most CellGenix there right now fast. out

lot us So a equivalency to looking testing. brand these U.S. supplier, to lot they consistency do and to want come customers looking R&D for equivalency, for systems looking for

just us, what you - So know the one they at and do and you'd of they the XXXs like which to all They're get least of using three when using start, all - They're and they learning four also or really already the want, get these, XXX, equivalently they three. out need by to the one people what one. want and they're - two of three because for way, seriously just is doing they a expect. IL-X no don't effort on can't

open now - been for getting into one that few on just So we because our started we've a but for working point months, we're of now, we're really just the inventory. at fourth

now getting that of level sense? lot that serious equivalency. make Does at we're So

Operator

Thank you. Kummeth any our Mr. session. the comments. and turn I'll gentlemen, that to for Ladies concludes floor final question-and-answer back

Chuck Kummeth

company for billion and have here. $X with call. - great really well our we of all we attending a to We and quarter, $X the us more and way billion we're love think on ahead thanks some a Well, being Okay.

Thanks. to you next So quarter. Bye. we'll talk

Operator

conference. concludes This you. Thank today’s

You this may disconnect Thank your time. participation. your lines you at for

Bio-Techne (TECH) 1 Feb 222022 Q2 Earnings call transcript