AZTA - Earnings call transcript Q4 2024

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Operator

Greetings, and welcome to the Azenta Fourth Quarter 2024 Financial Results. [Operator Instructions] As a reminder, this conference is being recorded on Tuesday, November 12, 2024.

I will now turn the conference over to Yvonne Perron, Vice President, FP&A and Investor Relations.

Yvonne Perron

Thank you, operator, and good afternoon to everyone on the line today. We would like to welcome you to our earnings conference call for the fourth quarter of fiscal year 2024.

in press today issued our be and website at earnings of the Investor used quarter supplementary located market the remarks the is investor.azenta.com, during fourth the release that today. after was close Relations PowerPoint prepared Our slides to will addition available on

Securities many are be or differ the Form everyone PowerPoint meaning of update data various those make the number forward-looking statements. occur our within presented harbor the I XX-K reports There safe including remind the We the earnings forward-looking the XXXX. of may results no and today. identified release a that financial to future that XX-Q. forward-looking would for presentation our our statements on like actual financial slide to you the making annual factors other aforementioned course the Act titled filings on obligation Private and cause Litigation such of during or with differ to section our website refer call, of we will events from SEC, statements of from Statement, Harbor I the quarterly to would on in our on on that report Form events these Safe statements

non-GAAP business. the measures provide understanding exclusion and in measures, with the to upon not with believe when results reconciliation but operations results of an may are of Non-GAAP accordance viewing provide of non-GAAP and GAAP more GAAP. aspects number addition way a of of We to be conjunction should our they We considered the used presented relied performance, refer even financial and an measures measures, to in complete themselves. the of the Azenta which financial with additional in measures GAAP GAAP

Chief President John Chief our with Herman On Officer, Cueto. our the is today Executive Financial call and Officer, you and Marotta;

will with and provide then call for our remarks a detailed from outlook the into Herman financial results John, look XXXX. our open will We year fiscal

your at end take then remarks. the will the prepared of We questions

I that, call turn the to John with And to our would Marotta. CEO, like over

John P. Marotta

afternoon, fiscal and Thank Thank I'm us share and results. behalf Azenta joining you, have honored we year lead our quarter full phase our you, for Steve. employees shareholder opportunity and to to everyone, you employees success. its Yvonne. for On XXXX customers, fourth today in the delivering to of and thank Good company's next of Azenta shareholders. value [indiscernible] as the

for very also working first in-depth thank our reviewing the I to want X,XXX global many My focused our portfolio. meeting and on sessions warm XX to days welcome. our have teams, having at Azenta been locations, customers, associates almost our traveling our

and a We long are of already tackling busy opportunities list sense urgency. a with identifying of

week, our strengths. our briefly Quentin these Alan Koffey we Last that about skills diverse recent to of complement who of or Independent bring want William Directors, announcements. Board and the additions Malus. a excited set X to Board's appointment discuss new I announced Bill existing Cornog, I'm

allocation in and driving a that value including established and cost long-term committee growth, also value the Board We assist initiatives. new creation will capital creation through advise

with KKR by Today, Lawrence of the decade invested we is equity Lawrence CFO and at known I've returned Xx management company. for Stabilization company, new of and equity-owned of announced that he the Lawrence private team a was part tremendous Most recently, executive a was GEO where International, KKR. also a nearly the the Lin PHC, as work appointment our KKR who CFO. a closely Danaher

to thrilled precise implementing. principles team phase the move him I'm we join possesses into a In model He exceptional performance and to we addition to next all his the he skill operating Lawrence know of extremely to lean we agreed has better. business well excited is CFO, versed the need systems as Azenta. get the set in for are as and that

his helped the already some to to which Azenta. opportunity the contributions I'll progress transition. his on I made adviser Cueto the us for on and achieve company, us benefits. many foundation [indiscernible] he'll thank take significant Herman yielding notably, at which build on at acknowledge Herman during margin work program, as this also an has smooth with developing including a ensure with time will XXXX to time although continuing to tangible him, want he is most for a leave great us be

the market. and share in depressed the Moving business. delivered and life in quarter I'm pleased to on to sciences uncertain the despite year Azenta strong results

line Our full on basis. were million, we of down $XXX revenue XXXX reported results year-over-year as organic an in year with guidance our X%

combined the Management core Multiomics Medical, year. for X% revenue and by B grew Excluding Sample Solutions the

businesses in performance. is focus then briefly the on my spend beyond. this first financial Herman more to speak on to Medical, community, and our will I'll into As investment and areas few key going the XXXX core B then about opportunity to touch go of minutes discussing perspectives I'm our and my detail a

our our where B a have tremendous we This core us action opportunity to high-quality decision Medical. and allow to margins. core businesses Today, we announced expand accelerate will sell to growth refocus

relevant. will sale We on updates as provide the process

on of to its my XX on businesses. today. excited now attractive portfolio to I company after job, We'll about even and businesses. core competitively Azenta advantaged turn was join more our the enthusiastic days And I'm of perspective because our

enjoys streams tailwinds business revenue Solutions and advantage, profitable and competitive highly significant Management services long-term recurring a its outsourcing subscription offerings. from Sample Our

and are cryogenic customers want requirements. the to site, store we unique customer's For who that cold on to customized differentiated sell products storage

bio to want we repositories. at outsource, our offer storage of X who customers For

to the efficient with automation and storage management workflow intelligent technology the sample our generated to It is That needs retrieve. software coupled warehouse solutions. both, automation manages and a enables it both functions core provides When customer and management at samples registration formatting, and retrieval. access a pinpoints scalable library For tool. highly timely solutions, digital growing our samples of the number as of and

in ultra-cold out unique more our products automation large-scale revolutionary new and our technology storage. invest a like BioArc-Ultra, sample building We'll and product enabling developing eco-friendly

its Multiomics data is which business and to research and that our performing for needs environment. offerings newest approach renowned to business, scientific evolving analysis a to develops embraces consultative This product discovery. collection the the meet now Moving scientific of research enables technology and rapidly impactful genomics in expertise customers

By way first of the business example, our was platform. NovaSeq among X implement next-generation Plus sequencing the to

will the first And U.K. customer with transition half of stabilize Genewiz, continue throughout we driving constrained, location capital adoption has of to earlier technology pricing Oxford it this it outpaced will in enabled investments combined continue to While benefit from our Funding increased the this R&D our XXXX. of has commercial outsourcing for growing with opened headwind. be pressure, which services, for pricing pricing brought trusted capabilities partners like new year. that expect our execution

include the market we have our In our technology our market XXXX, portfolio close workflows by shift since in we the to adoption Sanger in headwinds. our we'll demand. In investing to to we more Gene sequencing sanger growing of downstream the in and ongoing broadening with traditional and business, product synthesis created satisfy continue our met Synthesis expand offering capacity in intend business, are Sanger U.S. its to gap the launch

to we in relatively to opportunities even cash dollars, I expand investments flow, offer and thanks tremendous returns available mentioned we can the increase be attractive very absolute margins and have small are us. Importantly, efficiency growth as the made

optimization about We've a the I'll we in Next, ongoing for with talked capital spend XXXX excellence portfolio portfolio few beyond. key focused operational and areas about minutes optimization, allocation. are talking include of which Medical. value-enhancing sale B These and

achieve I system to impact performance build expect to our an become principles of at business business work and the the operating improvement ambitious help goals. model foundation with operational key tools and models impact positive way reduce other of culture. Continuous will our terms I've in In unify these excellence, firsthand have to system and priorities experienced use In time on high-performance us and have the my will the simplification identified performance. complexity. our performance driving outsized drive we the of organizations, exceptional lean had our we at Azenta that implementing helping strong

excellence focused KPIs with strategy. Operational align and profitability. indicators with our our begins daily broadly growth will These key revenue performance that identifying on are operating decisions

enable force profitability gross will optimization. continued expansion innovation. by We'll expansion geographic growth revenue improvement achieve and optimization, cost structure by We corporate sales margin and

and working management and internal customer-facing include quality delivery KPIs and cash capital like on-time like metrics, metrics Other and advancement. metrics turnover employee

The compensation first addressing step our is in our simplification programs. incentive process

structure core cash revenue KPIs. team our objectives, customers shareholders. strategic compensation working We capital. have members growth, organization be compensated and performance plans for This with and our our profit win make will operating our businesses on adjusted Each X. we down aligns new EBITDA our to X or clear align and help or directly it to flow us free drive improved how consolidated our will This from our structure with of

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more inventory our our Improved be will prioritization timely focus areas. will and drive savings, improvement streamline better supply direct expenses material provide Indirect insights supporting systems information continuous optimize and of process across Enhanced chain. procurement key deployed judiciously. organization, will the and

we allocation. like capital make how think clear on Finally, about I'd to it

We allocation robust will and a make process. our consistent, returns-based decisions through capital

be outcomes. will accountable for We

organic gross growth expect logical investments increasing that new expand will drive profitable capacity evaluate by and potential improve productivity, tuck-in or developing inorganic margin, We M&A. to support through offerings growth

the stock. with always will We repurchasing compare these returns our investments for

detail competing management In to more the Day share how I'm the plan and in our host We'll our can an with Board to achieve investment refine we mid-XXXX summary, Analyst Azenta's we potential and findings full senior resources further community. our internally. to for in actively with view Value working it. Committee will Creation be of

like term. to Finally, thoughts on few offer I'd near the a

are has entering opportunities in started. While Azenta getting and XXXX, momentum tremendous we just

quarters, based on indicators several from upside today. on of recovers market the execute and for positive our is initiatives out we the guidance Our we've laid last with the as opportunity continuation the as

attractive and XXXX the second of We and store's NGS recovering profile have secured half the reoccurring date. the revenues, C&I our year backlog full in given confidence to in

that our I'm and message look of about After a employees the to to lot our to deliver in sustainable to you. and ground Azenta's our confident covering you a ability you potential, Thank progress. shareholders. excited long-term updated pleased our want on to to I'm I Herman. over leave turn keeping that, I customers, call With today, with value forward our I'm

Herman Cueto

the like guide the the John. words, Azenta finance Good alongside a and And been and teams be help from especially for incredible and afternoon, evolution. pleasure you to cheering will and kind everyone. have I'd its I the with by work sidelines. company worked start to thanking Azenta who for It's Thanks to dedication commitment IT

strong that is building his and all impact teams digest high-growth running companies days, customers, seen what it's in As to our XX an admire made John, serve to leading needs to just company and operational and well. life his John. is has excited welcome our to how proven information come extremely to in, In know, our John addition the clear death successfully I us got his will and I've global on record track already experience sciences run are do. to great of root shareholders his hands, in of employees company. hit get Azenta ability the simplify we the complex I've the ground we

issued we well executed As in saw results today, QX. from the you we

being pillars notable some March, get we I details, transformation to our fiscal Day XXXX. recapping in Ascend program financial this we and and want them. it the simplify launched identified sites for either enable we I which XX, additional bringing in rationalization, Before key area quarter, or XX% In and X total XXXX, Under Investor start of an company our year accomplishments in represents altogether site progress our sites of scale 'XX. the nearly to called At fourth impacted Ascend year closed X our growth. the rightsizing to into by

optimization system that we are and cost. IT goals month. successfully from by system partially us have enabled in described functional reduced transformations in we great capabilities our to improve towards simplification, give reduce journey Analyst substantial at initiative, operating XX designed X our have remarkable margin happy progress core confidence am organization where and have our Under made flight several is we This to progression achievements Day. announce this count These I to the our

optimization, Lastly, The portfolio intention assets exited And our under Solutions the we in Multiomics Systems. reshaping and of X capabilities core of announced non-core to lines. our quarter, our B Management portfolio on Medical we sell today, the umbrella and second product strategy. to our Sample pivotal is focus to

navigated down commitments. million, financial X% On expected as conditions down against Market the Focused our effectively results. XXX organic be revenue year-over-year to a line basis. growth above-market execution delivered segments on year and Multiomic and was basis us out SMS X% what to adjusted on points. deliver to approximately enabled we and our EBITDA great margin year, we reported $XXX macro Throughout execution continued a in our expand and played through environment. an basis by challenging top Fiscal 'XX the

second and with profitability in to finished the half we operating the improvement meaningful margin. returned In year, of a

those our sustainable We optimizing and and deliver into efficiency, structure considerable expect improving to operational beyond. made in 'XX cost expansion to year fiscal and progress continue we margin have efforts

I on to supplement the results that, our the With my full year. would the deck turn slide will remarks I available to to website. quarter today, in for refer our and like To

storage. market. organic contributors revenue down as to year-over-year million, stores, X% was for grew X combined an SMS down basis reported instruments X% and to to $XXX quarter performance outstanding growth Slide and on the on a next-generation as highlights. include and Most consumables Fourth and year-over-year basis. some organic Multiomics well X% sequencing, notable Turning relative cryogenic

] X% organic. Medical Multiomics a expectations, SMS year a $XX down XX% B was X% B basis. Medical an basis, year-over-year. down growth. million decline On for came and was organic of XX% and revenue representing in ahead delivering million a $XX X% revenue on [ combined revenue, and slightly which basis organic down in delivered was million, XXXX Fiscal on contributed $XXX reported

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reported our representing of results XXX a In X% quarter and is a to year-over-year. X% take the $XXX favorable EBITDA turn year-over-year. fourth decline product operational XX%, look of improvement at was largely quarter. Total revenue let's XX.X%, million, points Now points up up margin margin Slide X of Adjusted basis deeper was gross XXX was in $X.XX share. non-GAAP organic. efficiencies. in quarter, EPS a a to Again, the The and non-GAAP per result mix decline the basis was

grew XX%, The instruments, great which in QX segment in our SMS. quarter, in results, up the of revenue quarter compare offset and year which and XX% momentum fourth and SMS positive sales note, turn year-over-year the onetime we is to efficiencies a XX% and year-over-year. grew mix. the operational margin spite review $XX X% declined This SMS On in QX. recorded stores, million was slightly for X% of Slide in starting let's which X of a custom organic. cryogenic in gross of the items that, in consumables a non-GAAP up continue benefits reported see for With was with quarter. XX% stores, to prior favorable tough up impact

to reported on revenue growth Multiomics to $XX of X% QX Multiomics basis. year million, revenue a Turning next both which segment. quarter 'XX, the translated the fiscal organic delivered and since largest

Next-generation XX% and price year-over-year, a strategic sequencing combination like larger deals from of benefiting grew FinnGen stabilization.

saw growth year. markets critical our new such acceptance value an of compared down Sanger modest as in see we spending sequencing cycle XX% year-over-year to evolving are last we And good through continue to Gene while constrained Synthesis still Sanger to continue as pharma. offerings, was revenue seeing market. we

of gross China again XX.X%, market largely gains to productivity up growth revenue volume the year-over-year, driven pricing quarter that in organic outperforming as fourth helped XXX a offset X%, delivered growth with once was by non-GAAP in challenges. basis business macro well NGS margin Multiomics Multiomics points as Our headwinds.

million due year. B the was XXX XX.X% And gross organic basis quarter, reported Non-GAAP of both Revenue orders. last Medical. finally, basis down of on and the timing a up to in versus points $XX XX% margin was

Next, cash, a ended turn to securities. X had balance and cash with We the let's We $XXX review sheet. in equivalents outstanding quarter of million the Slide for debt. marketable no

statements consolidated cash our Regarding of flows.

the of by that currently changes of classification process, the cash part and reviewing the cash activities rate amounts we principally on and closing of operating effects consolidated line equivalents are year-end flows of exchange our statements cash in items cash flows included As cash provided of XXXX between not in we before and could items impact press flows issued quarterly fiscal cash year-end our earnings call. release XX, issued in our potentially statement have this line Therefore, those periods. for previously a statements September XXXX of the

$XX previously the September issued for million Multiomics on for cash ended and the are we in in about The impacted reclassification year Capital the businesses. changes million Solutions quarter invested full and year reflect report for the by approximately period. scale annual Form any fiscal for Sample not statement sheet $XX statements expects XXXX. balance its and XX, company income cash to growth and flows item XX-K the as were our consolidated flow any Our to Management of expenditures for

Turning to guidance X. on Slide

XX, sell is our announced business. As Therefore, reported reflecting recasted will forward. discontinued be before B The issue within our to XX-Q plan going the December discontinued we XXXX. you operations of it as are the B historical company its Medical release, intention actuals, Medical B XXXX saw Systems in excluding of filing press ended guiding operations the to the Medical

an evolving transformation As watch are a on of Medical, XXXX strategic grow we to year-over-year. environment, the in of revenue range B we exit guiding and continue complete macro efforts our X% focus X% organic to to

We Multiomics in mid-single by low combination a are automation digits digits. Growth forecasting Solutions and strategic single grow growth of excellence, contribution Sample investments to driven technology. will to commercial and vectors new be and from Management grow

We approximately of margin expansion to are adjusted basis XXX committing points EBITDA year-over-year.

we closing, performance pleased in are In very year with fiscal XXXX. our

the in about progress optimistic are made we We the business. noteworthy have

As our life questions. the to commitments, XXXX, our we we I turn our to operator remarks, prepared customers on and call concludes turn serving attention in and sciences delivering to faster. are for breakthroughs the will our over This executing committed now enabling

Operator

Your first comes from question Needham. David from Instructions] [Operator the of Saxon line

David Saxon

have So on on X I the then margins. and X, guidance X

at thoughts Analyst So from for, 'XX first, fiscal of next excluding be guiding this page. John, I understand might Medical. multi-part you target, Medical long-term the to question. a ex targets, But that's you're first started think would X% Day obviously? model on a X% Multiomics, your whether growth, so will B but next SMS I to they're I new year, I to was expected hear think achievable the an kind B be grow Or look question, hosting to love organic guess, the fiscal high singles, 'XX the If

relative into -- are that point? kind the And then the guidance a still 'XX in this fiscal baked Is market assumptions targets. lower to is the and of 'XX function of macro number is the X you execution at or

Herman Cueto

LRP. David, add start Why could John don't a and bit the color. little then and of it's jump I Herman. first Why let we don't I with start in

inside Day if you the the at back, LRP above-market progress fiscal we've year announced against So David, XXXX growth of considerable Investor and including 'XX. seen we margin achieving expansion step that

continue market are We revenue just that the we gave. by feel about illustrated good to that targets year also the above as fiscal 'XX

to in guide for third and does is also as X% current When [indiscernible]. at from John fiscal the a an maybe LRP look you some on X% And the peers. saw half of market being upside. hear back believe bit this the see pushed what margin second X%, we I we right year of If to certainly EBITDA of consistent the the fiscal 'XX. is think comes it by to achievable. out now, 'XX at XX% to environment recovery growth point year little And bellwether we assume starting of XXXX, XX% now of we this is of of that the X% But midpoint with think do maybe it the inside with X% we're

John P. Marotta

the confident to bottom capability. the is few -- struggled pretty in a as I uncertainty going Just working capability we our think look on demonstrating about question, right line, thoughts. We've the demonstrating be XX, some important. through I I and it's good Thanks mean feel there now. into in for we We guidance, think line you. and top with on at but We're really be enter it's But general, that. pretty to there's market. the as

David Saxon

probably And second Okay. Great. That's my for Herman. super then helpful. question,

So the margin, this quarter performance last. and good EBITDA really obviously,

fiscal So 'XX the the is of for half guidance to relative 'XX. fiscal implying second of flattish kind

of color play Or to of want of that margin? cadence Is just -- Medical any are for out dynamics there. I So there any B model? on of dynamics that other understand coming the kind kind the quarterly just EBITDA the kind

Herman Cueto

we're Investor and that even XX% said hitting now. pass in EBITDA to a of mentioned. going to look, if we're we we we we I margin XXX see highly guide do And Day, on Thanks, basis through, just at range better David, confident XX% get want of but to to do right course, we start year. to that in Look, start each David. to do expansion that come to points count -- we're along, expect it

to last we what over. When to need that to do have above to into XX%, at as year we we have that would I come were you the where items are quarters 'XX, some fiscal point some want make. look X we There I is think jump we investments

to we on and guiding we're a sure where point EBITDA come confidence. both the the I of that look ton Maybe you EBITDA way saw sales year at cadence. make have to an want 'XX. So in a EBITDA margin from the quarterly minute revenue a an we would fiscal of cadence, the view, consistent with

cadence that you've at similar year. look seen being what So to as this past

Operator

next from Jacob Stephens. Your Johnson of question comes the from line

from from Next Evercore. question Kumar comes Vijay

Vijay Kumar

Azenta. do [indiscernible]. heard that's the the call welcome [indiscernible] John, number. few if you And strong the don't a you say you've transition [indiscernible] to a earnings [indiscernible] quarter? it double-digit Azenta's completed I And strong in pretty guess, mind questions had expected now would growth? I I think I and on

Herman Cueto

was Yes, don't trend NGS count of the continuing, right, volume strong see in certainly We we grew a to up, this we fiscal saw that and now on to momentum continue as go XX%. it head -- year positive abate. -- Herman. positive but 'XX. we it want as is indicator price into right So Vijay, did you're is the really quarter. We

question last NovaSeq the on transition, And was? point at Plus running Yes, is those remind this what everything tools your in almost X me time.

Vijay Kumar

the Gene in Synthesis Sorry, quarter.

Herman Cueto

full in to I quarter mid- for it high single Synthesis digits, was say, would but the was, Gene low year, single the So, digits.

Vijay Kumar

the of on Azenta tariff impacts. Fiscal in China. one hypothetical on just could on on any John, What would where from [indiscernible] [indiscernible] Understood. maybe in like? X. potentia is . And ways scenario you questions here you look China China I tariff importing comment did if guess guide what China 'XX? the And for a lot do analysis

John P. Marotta

Sure, Vijay.

couple comments. a of So

Let China. in Gene We're some the color positioned independent It's Gene to a give From are directly -- capabilities invest me the perspective, U.S. the Synthesis U.S., growth -- Synthesis. well high our capacity. we a markets. mean the I issue. around on single-digit it's it's In to in have U.S., we in capacity mirrored there capability serving both more and those just China in

are continue. business run, we that we to that's High So shorter higher have are margin and in came runs These Indianapolis. investing there. going we in in, think single that

of of U.S. China we don't tariffs, terms let an Regarding on impact. that regional how based -- to terms Herman comments think, today. for modeling going today, our and I we for that think not discuss China. briefly. don't manufacturer in for I'll see as in China we're regionality my U.S., sit We're here I

Herman Cueto

Yes.

the on China the year when company. the model. we you these in to in the don't we 'XX, And fiscal grew and X% year, total give how for XX%. and on considered were all grew guidance expect X% quarter Vijay, XX% regional So can But in that the factors we it macro things gave terms modeling all those us fourth about year, about full then full of

Vijay Kumar

sort X John, And level, of and but high early vision Understood. for you, I learning business maybe be last days, [indiscernible] for helpful? and X know it's the for still strategic would your you

John P. Marotta

Sure.

few share operational a really mean to thoughts. around You areas: X and, excellence focused course, happy portfolio optimization, allocation. capital we're bet, I of

be to in win. growth and We've There's revenue. reoccurring want good the good We I on trends got us end touch focused customers. our I me We're markets. for portfolio. an about secular right attractive and mean, you if Let quickly. really products for outsourced high-margin Medical mean, think to around got our pretty services -- easy businesses, strong capabilities. We've B is decision

around that that's lens there. and we're So portfolio the taking

B business, us the now, really to confident areas. moving focus Medical we going on right in think as our allowing I and businesses we feel -- sit portfolio and here SMS our business those forward, especially out today, of those Multiomics

R&D, capital this it levers there on a to for X that. organization and around clear We creation this around our allocation, to significant paths. around around; capacity third and and observations to we value strategic the criteria allocation capital taking earn following As some are investment, back The around be in other specific capabilities want I pertains meaning in pull demonstrate area. what's productivity very and increases, lines, gross tuck-ins. need some business is lens margin is in initiatives here. growth The M&A we're there's important on this and the rigor these improvements, other return way

and around We that's this the lastly, allocation. to but in the the think talk of of excellence, buybacks. then and well. I there's other but really, I Danaher capital terms operational And really lot discussed, basics the a from want be lens coming against about options lastly, always And I'll just here, compare biggest I And on around KKR. doing is share brief learnings learning

there's with opportunity real is and and around starts of past. I alignment think departure bit to I and prioritization, going here. drive an how This example alignment we're prioritization. want to from value. give It a of that's the a a

implementing ability drivers the business businesses Those core and how win going First, and plans and the in moving will off complexity we in the to go in teams value around really talked of be going is how drivers. to is with. will from X value cascade about we to these organization, win core the the we the understand we our important have down give compensation X. organization to The the simplification need

main means share that value specifically X here. in core areas What X but drivers, of really is stakeholders

that X metrics. around We and that centricity is around do the is quality First to drive delivery. customer these going here. We're through customers and on-time

operating internal That's that's employees we being how businesses. our And top promotion is and growth, capital working invested expansion, we that second third and look and and The on turnover capital. win return in shareholders. margin the our at. around line

opportunity that kind in call. a the Vijay, that's there's of but around right later gross leave really, G&A business margin So COGS, we'll of But our view in now. general, for and

Operator

line next Stephens. from question Jacob of the from comes Our Johnson

Jacob Johnson

a to and you. both off you I'm of maybe welcome. first with maybe has great the you freezers made. John, been Maybe you. [indiscernible] great of working start just on progress all us Herman for with to educate

the saw I'm the curious are there of I kind seeing stores headwinds kind were environment? was the from just you think in you down quarter. some Or capital equipment of timing? what

broadly it's obviously, of market of the word years, for on X-letter longer the now. the for your then for investors you And for last kind portfolio. kind of differentiation the in just And outlook is kind that thoughts term? about view of then, a your kind the for freezer freezers just market of been right given John, your background [indiscernible] difficult couple Can of talk market

Herman Cueto

Sure. -- don't that had , high of in record we in, year jump Jacob, it was stores the I we where quarter. fourth very the visibility a right, that growth first? business. the had had You're go very, why I that would remind were want everybody everybody fourth compare in have remind tough quarter, fiscal down to rate. in the quarter I 'XX, backlog we into it a very a

it. And visibility where to sit backlog. we now a of is We that right into XX% confidence have we in lot close have today,

feel for we year about stores So guide good our in 'XX. fiscal

John P. Marotta

our about feel is very very, I Jacob, market a in a freezer in here this few us. we thoughts business, conversion observations. good here mean for Around penetration capabilities the a market today. business

if general, a stores shift business, see you're freezer think about and I those going viability it's to a over term, you farms automated. natural highly to where of the think long in the I think

in organization. square competitive You are capabilities efficiencies The more look importantly, our these per are real. mean, at how situations. strongly meeting the opportunities, loss in we penetrate these feel think win about conversion we pretty samples And real but I foot. I

really capabilities pretty at got from good general, in advantaged point that freezer market, of bullish on in this. [indiscernible] here And So I space having view Azenta I we've understand specifically. we're around come the his think

Jacob Johnson

just That's NGS. it. Got And on one maybe helpful. then

Just first year. of what volume? stabilization in maybe versus of half Can terms you I I of talk that about you trends about in some continued the business? talk talk pricing can price heard seeing just think the you're you the there on about piece

Herman Cueto

Yes.

So and which QX benefited drive Jacob, helped from QX, nice we did that. to you space, Yes, the see that did do rate to increase, stabilization it's the saw. from really We price Herman. continue so we to in volume volume see growth

helped prepared We quarter. drive from deals we FinnGen, as also, which benefited said in like the rate we the some growth the in remarks, larger

Jacob Johnson

[indiscernible].

John P. Marotta

all Yes, to Jacob, each getting we're know other.

to to double this we're digit system, when now. I double digit. We why continue pretty remiss [indiscernible] around that's high this to of competitively our in in think we outlook. unique right area. So that a the single to make on terms There's terms here -- is I unique the I the comment in is going think continue. of to business. going this market LIMS on have based market this system growing wanted That's advantage And mean advantaged I was in we're penetration market a conversion. enjoy

Operator

the James. from from is Andrew Raymond Cooper question of line Next

Andrew Cooper

fiscal maybe it a periods of 'XX to you John, great just macro, the the Maybe you think Multiomics. do closed first comps some But about publicly here. bit connect X this though. about guide where pricing a some overly know ] I of different not you year, difficult little bit I [ to want we just little ask in be the when way. a should to in time we just growth. a mentioned talked have quick

can mind out that just we was right from us the fourth you've in seen quarter should that to what might of X% the than lay to terms you in being to bullish you keep with already? a core be maybe in what line given business items kind keep So the X% of with in deliver, some little that able of more

John P. Marotta

potential There think got a a is There's in to had turnover. territories. bit here, open about for some we've this things of transformation. Andrew, that distraction couple being XX the days, around of for We

it that a our at point helped that may directly around prudent in I've I time. And in the really out somewhat bit. in think the really this we're well, little how of comments, to guiding not have come we're being clarify hopefully, that's guide but organization this part

Andrew Cooper

X given probably uplift, the number near of helpful. and know, somewhere, guidance. the just more about ops breakeven probably we different then wonder you I do that's don't No, continuing Or I think the EBITDA sticking fiscal a 'XX? reported we of a base terms EBITDA just sure And in margins margin Medical when to what for bit was off just B from margins reported? being think little points, need the again dilutive with of to overall about base that is kind basis XXX the

Herman Cueto

Yes.

financials will all [ for that So we before recasted first basis the on that points information. the we'll XXX have the issue out quarter do the get you'll we Q, RemainCo]. you, But is Andrew, and

Andrew Cooper

an basis On apples-to-apples or?

Herman Cueto

Yes, it would be apples-to-apples, yes.

So you'll get a restated [indiscernible] number

Andrew Cooper

kind fiscal a for [indiscernible] the yet? you So, that pointing towards have us can't you're number give of don't fiscal 'XX, sense is 'XX given we what actual

Herman Cueto

basis the the above points to be Yes, want I neighborhood. will in it say would XX%. XXX be

Operator

question . from of next Matt Jefferies. the Your comes line from Stanton

Matthew Stanton

[indiscernible] the focused. were where I wonder helpful business what comments your you're for on vision

should how you your If kind you need go to talk be to a M&A, need there. maybe just and to you you of funnel looks that talked about into today? think Does Can of terms way the earn back rebuilt tuck-ins the or strategic inherited in leaning little [indiscernible]? changed at maybe metrics be such all? experience do strategic some on you your evolution there from as and any the as prior of key to And about financial those criteria tuck-ins, lend deals

John P. Marotta

margin here. sample Today, see to with to continue a in automation general, When there. we I short-term, think mean, automation, how you how mean mean, call here, point days little this dramatically. be we're of a if build capabilities cultivation is to have ability at And in will invest our I funnel, manual in the going to around I in both to SMS general, process Matt. business, to our capabilities. long-term view. it with registration, and when the it about we're early I we around have gross we thinking ability It's invest comes in invest in I more taking that Yes. surprised improve M&A our there, rigor about SMS our candid driving was specifically more out

business, future in take a a XX look that in keen it's are more years, pretty type business opportunity on margin, make where It's attractive. to But sense. an that's gross we're them lower lot in means we're for of again, really days is of in a that margin, area our contracts there's biorepository an a we automated at. and on putting our potentially there starting These What the and higher more bringing think early those there. M&A platform, gross biorepositories to X

I rigor very around ROIC criteria, expect and to clearing any of criteria that what to a be criteria mean would metric there's around the that Regarding going we're be got digits. double stringent that, I is. around

Matthew Stanton

for you, then maybe And X Herman. helpful. That's

dynamics, sounds of talk like about mix market X% there the the guide pricing standpoint what's pricing in kind NGS XXXX? a X% Just baked headwinds into for from baked to It year. [indiscernible] growth next

Herman Cueto

Yes.

that And being see to we through again, at to it anticipate price. continue But look want could as headwinds the very type but typically. a out. how is want comp. what So detailed to give of as continued it the Matt, on we do stabilize starts as give say to We don't information we NGS X explanation don't a in would pricing won't we could, cycle trend. We it play I quarter

Operator

question Markets. from from last Your . line of KeyBanc Capital comes Knight Paul the

Lucas Baranowski

at you whether Knight KeyBanc. second the on first closing half Paul half for can more One and Medical time in color for B signing of line transaction the Is be there transaction. Lucas likely is it's event? type This any provide on quick question that the or to

John P. Marotta

go question, ahead. It's a good Lucas

Herman Cueto

days, looking of we're that year. certainly of year think event, first at as a I type is expect something Lucas, I half Yes. do of sure. first this could half X would for we the It's but early within this inside the still

Lucas Baranowski

Great. CapEx, lower Medical Would the divestiture closing? B you the after And number said the over to I trend $XX that then switching million. CapEx quarter expect you believe for was to

Herman Cueto

you X%, this certainly stick But the down. to it right relative X% range. [indiscernible] to think in mean I to sales, come I you're probably will if No.

John P. Marotta

there's what again, We another pencil our into about business. double talked around that. the early opportunities And you to sharpen in deploy digit, building we lot But terms I growth and I are margin. to in at being looking couple at look specifically, thoughts think at of of how we're mean business. It's, are in general again, that We'll improvements that CapEx a I And let come so of initiatives. in capacity investment there. I productivity on capital our around now return we going there's initiatives. take we know allocation Lucas, a like. back We'll you days. we capital look and the looks what in right gross looking mean and think think

that want in matches allocation going Thank you think make forward. and strategic our sure I capital to our But we initiatives the question. general, CapEx for

Thank It's you. to with you good all. be

operator. go So you. Thank ahead,

Operator

There further are no at time. this questions

the over for back turn So Herman go I'd call Cueto Please sir. to to remarks. ahead, like closing

Herman Cueto

leadership world the for team, X,XXX support. of you. dedication like you, employees our Azenta I'd and continued everybody. the On behalf Thank their Thank around to thank

Operator

conference today's you, your for concludes everyone, call. participation. This Thank

disconnect. now may You

Azenta (AZTA) 12 Nov 242024 Q4 Earnings call transcript