BOTHELL, Wash., Aug. 8, 2023 /PRNewswire/ -- BioLife Solutions, Inc. (Nasdaq: BLFS) ("BioLife" or the "Company"), a leading supplier of class-defining bioproduction tools and services for the cell and gene therapy (CGT) and broader biopharma markets, today announced financial results for the second quarter and six months of 2023 and updated guidance for the full year 2023. Management is also providing a first half 2023 financial profile of certain pro forma financial metrics excluding Stirling Ultracold (Stirling) and Custom Biogenic Systems (CBS) freezer assets, both of which management intends to divest by December 31, 2023.
Mike Rice, Chairman and CEO, commented, "Subsequent to the end of the second quarter 2023, after considering other strategic alternatives, management and the board of directors have determined that divesting our Stirling and CBS freezer assets would optimize the performance of our product portfolio by focusing on recurring higher margin streams and create the most shareholder value. We made significant progress to achieve this objective and based on the level of interest and the feedback we have received so far; we are fully committed to starting 2024 without the impact of the freezer product lines. We continue to appreciate the value of the related IP, products and teams, and believe a buyer or buyers will materialize that can continue to provide global access to these innovative products in a cost structure that fits their financial requirements."
Management anticipates reclassifying the freezer product lines as Assets Held for Sale and Discontinued Operations in the second half of 2023 when the accounting criteria are met.
To assist investors with understanding the positive impacts of these potential divestitures, the Company is now providing certain unaudited pro forma financial information had the divestitures occurred on January 1, 2023. This unaudited pro forma financial information is presented for informational purposes only and is not intended to represent or be indicative of the results had the divestiture occurred at an earlier date and should not be taken as representative of our future consolidated results of operations or financial condition. Preparation of this certain unaudited pro forma financial information required management to make certain judgments and estimates to determine the adjustments based on information currently available, which is subject to management's ongoing process as part of the divestiture transaction. Actual results may differ from the assumptions used to present this certain unaudited pro forma financial information.
The following table illustrates BioLife's financial results for the first half of 2023 excluding revenues and costs associated with our freezer assets.
Reported Results | Pro Forma Results Excluding Freezers | ||
Q2 2023 YTD | Q2 2023 YTD | ||
Revenue | $ 77,210 | $ 51,548 | |
Gross Margin | 32 % | 48 % | |
Adjusted Gross Margin | 35 % | 52 % | |
Adjusted EBITDA(1) | $ (2,247) | $ 8,216 - 9,216 | |
Adjusted EBITDA %(1) | 4 % | 16 - 18 % |
(1)\Adjusted EBITDA (non-GAAP) for the pro forma results excluding freezers was calculated utilizing certain estimates and judgments by management utilizing the most updated information available at this time. Given that estimated results may vary, a range of Adjusted EBITDA as a percentage of revenue was provided. Due to the level of estimation required, actual results may differ from assumptions used to present this pro forma information. |
Mike Rice, Chairman and CEO, further commented, "We are confident the portfolio of high value recurring products and services, and expected strong resulting financial profile, after the divestiture of the freezer businesses, will better align BioLife to the attractive growth and profitability opportunities for a key supplier to the CGT industry. We sell critical CGT products that are sole-sourced from BioLife. These are not one-time buys but rather consumables that need to be replenished. We have a strong brand and track record with limited competitive substitutes. Our CGT customers participate in an emerging class of therapeutic modalities that are just now becoming real, and we naturally expect demand for our products to increase as they progress their programs. The reality is just that right now, the economy is tighter, and the participants in this ecosystem all want to reduce cash burn."
Sustained catalysts that we expect to drive BioLife growth due to a significant increase in the number of manufactured doses include:
In the near term, results continue to be impacted by constraints pressuring the broader bioprocessing sector including the following factors:
Troy Wichterman, Chief Financial Officer, commented, "While near term results are disappointing, we remain confident in the mid- and long-term growth potential for BioLife and our ability to generate cash flows from operations post our freezer divestitures."
Second Quarter 2023 Customer Highlights
New Customer Acquisition
Platform/Solution | Q1 2023 | Q2 2023 | 1H2023 | FY2022 |
Biopreservation Media | 9 | 19 | 28 | 69 |
Sexton Cell Processing | 8 | 10 | 18 | 33 |
SciSafe® Storage Services | 22 | 21 | 43 | 99 |
Thaw | 5 | 6 | 11 | 35 |
evo® Cold Chain | 17 | 17 | 34 | 43 |
Cryogenic Freezers | 15 | 13 | 28 | 82 |
ULT Freezers | 121 | 102 | 223 | 461 |
TOTAL | 197 | 188 | 385 | 822 |
Second Quarter 2023 Financial Results
BioLife Solutions is presenting various financial metrics under U.S. Generally Accepted Accounting Principles (GAAP) and as adjusted (non-GAAP). A reconciliation of GAAP to non-GAAP metrics appears at the end of this news release.
REVENUE
GROSS MARGIN
OPERATING EXPENSE
OPERATING LOSS
NET LOSS
LOSS PER SHARE
ADJUSTED EBITDA
CASH, CASH EQUIVALENTS, AND MARKETABLE SECURITIES
2023 Revenue Guidance
BioLife Solutions is updating 2023 revenue guidance, which is based on expectations for its existing business.
Total revenue for 2023 is expected to range from $144 million to $158 million, reflecting a year-over-year decrease of 11% to 2%. Excluding COVID-19-related revenue, this range reflects a year-over-year decrease of 3% to an increase of 6%.
Expectations for 2023 total revenue include the following platform contributions:
Conference Call & Webcast
Management will discuss the Company's financial results, provide a general business update and answer questions during a conference call and live webcast today at 4:30 p.m. ET (1:30 p.m. PT).
To access the webcast, log onto the Investor Relations page of the BioLife Solutions website at https://www.biolifesolutions.com/earnings. In addition, the conference call will be accessible by dialing toll-free (800) 715-9871 for domestic callers or (646) 307-1963 for international callers. The conference ID number is 4014878. A webcast replay will be available approximately two hours after the call ends and will be archived on https://www.biolifesolutions.com/ for 90 days.
About BioLife Solutions
BioLife Solutions is a leading supplier of class-defining bioproduction tools and services for the cell and gene therapy and broader biopharma markets. Our tools portfolio includes our proprietary CryoStor® and HypoThermosol® biopreservation media for shipping and storage, the ThawSTAR® family of automated, water-free thawing products, evo® cold chain management system, high capacity cryogenic storage freezers, Stirling Ultracold mechanical freezers, SciSafe biologic storage services, and Sexton Biotechnologies cell processing tools. For more information, please visit www.biolifesolutions.com, www.scisafe.com, www.stirlingultracold.com, or www.sextonbio.com and follow BioLife on Twitter.
Cautions Regarding Forward Looking Statements
Certain statements contained in this press release are not historical facts and may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "plans," "expects," "believes," "anticipates," "designed," and similar words are intended to identify forward-looking statements. Forward-looking statements are based on our current expectations and beliefs, and involve a number of risks and uncertainties that are difficult to predict and that could cause actual results to differ materially from those stated or implied by the forward-looking statements. A description of certain of these risks, uncertainties and other matters can be found in filings we make with the U.S. Securities and Exchange Commission, all of which are available at www.sec.gov. Because forward-looking statements involve risks and uncertainties, actual results and events may differ materially from results and events currently expected by us. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. We undertake no obligation to publicly update these forward-looking statements to reflect events or circumstances that occur after the date hereof or to reflect any change in its expectations with regard to these forward-looking statements or the occurrence of unanticipated events.
Non-GAAP Measures of Financial Performance:
To supplement our financial statements, which are presented on the basis of U.S. generally accepted accounting principles (GAAP), the following non-GAAP measures of financial performance are included in this release: adjusted gross profit and gross margin, adjusted operating expenses, adjusted operating income/(loss), adjusted net income/(loss), earnings before interest, taxes, depreciation and amortization (EBITDA), and adjusted EBITDA. A reconciliation of GAAP to adjusted non-GAAP financial measures is included as an attachment to this press release.
We believe these non-GAAP financial measures are useful to investors in assessing our operating performance. We use these financial measures internally to evaluate our operating performance and for planning and forecasting of future periods. We also believe it is in the best interests of investors to provide this non-GAAP information.
While we believe these non-GAAP financial measures provide useful supplemental information to investors, there are limitations associated with the use of these non-GAAP financial measures. These non-GAAP financial measures may not be reported by competitors, and they may not be directly comparable to similarly titled measures of other companies due to differences in calculation methodologies. The non-GAAP financial measures are not an alternative to GAAP information and are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures. They should be used only as a supplement to GAAP information and should be considered only in conjunction with our consolidated financial statements prepared in accordance with GAAP.
Media & Investor Relations
At the Company
Troy Wichterman
Chief Financial Officer
(425) 402-1400
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Investors
LHA Investor Relations
Jody Cain
(310) 691-7100
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BIOLIFE SOLUTIONS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited, amounts in thousands, except share and per share amounts) | |||||||
Three Months Ended | Six Months Ended | ||||||
(In thousands, except per share and share data) | 2023 | 2022 | 2023 | 2022 | |||
Product revenue | $ 33,037 | $ 34,170 | $ 64,630 | $ 64,558 | |||
Service revenue | 4,195 | 3,698 | 8,665 | 6,787 | |||
Rental revenue | 2,276 | 2,665 | 3,915 | 5,407 | |||
Total product, rental, and service revenue | 39,508 | 40,533 | 77,210 | 76,752 | |||
Costs and operating expenses: | |||||||
Cost of product, rental, and service revenue (exclusive of Intangible asset amortization) | $ 27,696 | $ 26,194 | $ 51,359 | $ 50,640 | |||
General and administrative | 15,402 | 11,652 | 30,241 | 23,182 | |||
Sales and marketing | 6,318 | 5,415 | 12,789 | 10,306 | |||
Research and development | 4,840 | 3,428 | 8,995 | 7,209 | |||
Intangible asset impairment charges | — | 69,900 | — | 69,900 | |||
Intangible asset amortization | 1,450 | 2,863 | 2,911 | 5,725 | |||
Acquisition costs | — | 5 | — | 16 | |||
Change in fair value of contingent consideration | (918) | (2,361) | (198) | (5,695) | |||
Total operating expenses | 54,788 | 117,096 | 106,097 | 161,283 | |||
Operating loss | (15,280) | (76,563) | (28,887) | (84,531) | |||
Other income (expense): | |||||||
Gain on settlement of Global Cooling escrow | 5,115 | — | 5,115 | — | |||
Interest expense | (419) | (32) | (829) | (216) | |||
Other income (expense) | 390 | (22) | 785 | 110 | |||
Total other income (expense), net | 5,086 | (54) | 5,071 | (106) | |||
Loss before income tax (expense) benefit | (10,194) | (76,617) | (23,816) | (84,637) | |||
Income tax (expense) benefit | (5) | 3,739 | (97) | 4,338 | |||
Net loss | $ (10,199) | $ (72,878) | $ (23,913) | $ (80,299) | |||
Net loss attributable to common shareholders: | |||||||
Basic and Diluted | $ (10,199) | $ (72,878) | $ (23,913) | $ (80,299) | |||
Net loss per share attributable to common shareholders: | |||||||
Basic and Diluted | $ (0.23) | $ (1.72) | $ (0.55) | $ (1.90) | |||
Weighted average shares used to compute loss per share attributable to common shareholders: | |||||||
Basic and Diluted | 43,441,219 | 42,460,189 | 43,235,558 | 42,238,355 |
BIOLIFE SOLUTIONS, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited, amounts in thousands) | |||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||
(In thousands) | 2023 | 2022 | 2023 | 2022 | |||
Net loss | $ (10,199) | $ (72,878) | $ (23,913) | $ (80,299) | |||
Other comprehensive income (loss) | 35 | (462) | 180 | (618) | |||
Comprehensive loss | $ (10,164) | $ (73,340) | $ (23,733) | $ (80,917) |
BIOLIFE SOLUTIONS, INC. CONDENSED CONSOLIDATED BALANCE SHEET INFORMATION (Unaudited, amounts in thousands) | |||
June 30, | December | ||
(In thousands) | 2023 | 2022 | |
Cash, cash equivalents, and marketable securities | $ 48,128 | $ 64,065 | |
Working capital | 80,724 | 93,870 | |
Current assets | 120,311 | 138,452 | |
Current liabilities | 39,587 | 44,582 | |
Total assets | 433,177 | 450,229 | |
Long-term obligations | 41,462 | 41,459 | |
Accumulated deficit | (270,828) | (246,915) | |
Total shareholders' equity | $ 352,128 | $ 364,188 |
BIOLIFE SOLUTIONS, INC. CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS INFORMATION (Unaudited, amounts in thousands) | |||
Six Months Ended | |||
(In thousands) | 2023 | 2022 | |
Net cash used in operating activities | $ (10,430) | $ (17,841) | |
Net cash used in (provided by) investing activities | 12,218 | (27,340) | |
Net cash used in (provided by) financing activities | 142 | (470) | |
Effects of currency translation | 28 | (190) | |
Net decrease (increase) in cash, cash equivalents, and restricted stock | $ 1,958 | $ (45,841) |
BIOLIFE SOLUTIONS, INC. RECONCILIATION OF GAAP GROSS PROFIT TO NON-GAAP ADJUSTED GROSS PROFIT (Unaudited, amounts in thousands) | |||||||
Three Months Ended | Six Months Ended | ||||||
(In thousands) | 2023 | 2022 | 2023 | 2022 | |||
GAAP GROSS PROFIT | $ 11,079 | $ 13,246 | $ 24,385 | $ 23,926 | |||
GAAP GROSS MARGIN | 28 % | 33 % | 32 % | 31 % | |||
ADJUSTMENTS TO GROSS PROFIT: | |||||||
Inventory step-up | — | 251 | — | 251 | |||
Inventory reserve costs | 2,185 | — | 2,185 | — | |||
Intangible asset amortization | 733 | 1,093 | 1,466 | 2,186 | |||
ADJUSTED GROSS PROFIT | $ 13,997 | $ 14,590 | $ 28,036 | $ 26,363 | |||
ADJUSTED GROSS MARGIN | 35 % | 36 % | 36 % | 34 % |
BIOLIFE SOLUTIONS, INC. RECONCILIATION OF GAAP OPERATING EXPENSES TO NON-GAAP ADJUSTED OPERATING EXPENSES (Unaudited, amounts in thousands) | |||||||
Three Months Ended | Six Months Ended | ||||||
(In thousands) | 2023 | 2022 | 2023 | 2022 | |||
GAAP OPERATING EXPENSES | $ 54,788 | $ 117,096 | $ 106,097 | $ 161,283 | |||
ADJUSTMENTS TO OPERATING EXPENSES: | |||||||
Cost of product, rental, and service revenue | (27,696) | (26,194) | (51,359) | (50,640) | |||
Inventory reserve costs | (2,185) | — | (2,185) | — | |||
Acquisition and divestiture costs | (2,143) | (5) | (2,976) | (16) | |||
Intangible asset amortization | (1,450) | (2,863) | (2,911) | (5,725) | |||
Loss on disposal of assets | (19) | (162) | (28) | (257) | |||
Change in fair value of contingent consideration | 918 | 2,361 | 198 | 5,695 | |||
Intangible asset impairment charges | — | (69,900) | — | (69,900) | |||
ADJUSTED OPERATING EXPENSES | $ 22,213 | $ 20,333 | $ 46,836 | $ 40,440 |
BIOLIFE SOLUTIONS, INC. RECONCILIATION OF GAAP OPERATING LOSS TO NON-GAAP ADJUSTED OPERATING LOSS (Unaudited, amounts in thousands) | |||||||
Three Months Ended | Six Months Ended | ||||||
(In thousands) | 2023 | 2022 | 2023 | 2022 | |||
GAAP OPERATING LOSS | $ (15,280) | $ (76,563) | $ (28,887) | $ (84,531) | |||
ADJUSTMENTS TO GAAP OPERATING LOSS | |||||||
Inventory step-up | — | 251 | — | 251 | |||
Inventory reserve costs | 2,185 | — | 2,185 | — | |||
Acquisition and divestiture costs | 2,143 | 5 | 2,976 | 16 | |||
Intangible asset amortization | 1,450 | 2,863 | 2,911 | 5,725 | |||
Loss on disposal of assets | 19 | 162 | 28 | 257 | |||
Change in fair value of contingent consideration | (918) | (2,361) | (198) | (5,695) | |||
Intangible asset impairment charges | — | 69,900 | — | 69,900 | |||
ADJUSTED OPERATING LOSS | $ (10,401) | $ (5,743) | $ (20,985) | $ (14,077) |
BIOLIFE SOLUTIONS, INC. RECONCILIATION OF GAAP NET LOSS TO NON-GAAP ADJUSTED NET LOSS (Unaudited, amounts in thousands) | |||||||
Three Months Ended | Six Months Ended | ||||||
(In thousands) | 2023 | 2022 | 2023 | 2022 | |||
GAAP NET LOSS | $ (10,199) | $ (72,878) | $ (23,913) | $ (80,299) | |||
ADJUSTMENTS TO GAAP NET LOSS | |||||||
Inventory step-up | — | 251 | — | 251 | |||
Inventory reserve costs | 2,185 | — | 2,185 | — | |||
Acquisition and divestiture costs | 2,143 | 5 | 2,976 | 16 | |||
Intangible asset amortization | 1,450 | 2,863 | 2,911 | 5,725 | |||
Loss on disposal of assets | 19 | 162 | 28 | 257 | |||
Change in fair value of contingent consideration | (918) | (2,361) | (198) | (5,695) | |||
Income tax expense / (benefit) | 5 | (3,739) | 97 | (4,338) | |||
Gain on settlement of Global Cooling escrow | (5,115) | — | (5,115) | — | |||
Intangible asset impairment charges | — | 69,900 | — | 69,900 | |||
ADJUSTED NET LOSS | $ (10,430) | $ (5,797) | $ (21,029) | $ (14,183) |
BIOLIFE SOLUTIONS, INC. RECONCILIATION OF GAAP NET LOSS TO NON-GAAP ADJUSTED EBITDA (Unaudited, amounts in thousands) | |||||||
Three Months Ended | Six Months Ended | ||||||
(In thousands) | 2023 | 2022 | 2023 | 2022 | |||
GAAP NET LOSS | $ (10,199) | $ (72,878) | $ (23,913) | $ (80,299) | |||
ADJUSTMENTS: | |||||||
Interest expense | 419 | 32 | 829 | 216 | |||
Income tax expense / (benefit) | 5 | (3,739) | 97 | (4,338) | |||
Depreciation | 2,003 | 986 | 3,733 | 2,639 | |||
Intangible asset amortization | 1,450 | 2,863 | 2,911 | 5,725 | |||
EBITDA | $ (6,322) | $ (72,736) | $ (16,343) | $ (76,057) | |||
OTHER ADJUSTMENTS: | |||||||
Share-based compensation (non-cash) | 6,856 | 5,973 | 14,220 | 11,372 | |||
Inventory step-up | — | 251 | — | 251 | |||
Inventory reserve costs | 2,185 | — | 2,185 | — | |||
Acquisition and divestiture costs | 2,143 | 5 | 2,976 | 16 | |||
Loss on disposal of assets | 19 | 162 | 28 | 257 | |||
Change in fair value of contingent consideration | (918) | (2,361) | (198) | (5,695) | |||
Gain on settlement of Global Cooling escrow | (5,115) | — | (5,115) | — | |||
Intangible asset impairment charges | — | 69,900 | — | 69,900 | |||
ADJUSTED EBITDA | $ (1,152) | $ 1,194 | $ (2,247) | $ 44 |
BIOLIFE SOLUTIONS, INC. RECONCILIATION OF GAAP NET LOSS TO NON-GAAP ADJUSTED EBITDA EXCLUDING FREEZER BUSINESS (Unaudited, amounts in thousands) | |||||
Six Months Ended | |||||
(In thousands) | Freezers | Excluding Freezers | Reported Results | ||
GAAP NET LOSS | $ (12,090) | $ (11,823) | $ (23,913) | ||
Expense allocation(1) | (3,174) | 3,174 | — | ||
GAAP NET LOSS AS ADJUSTED FOR EXPENSE ALLOCATION | $ (15,264) | $ (8,649) | $ (23,913) | ||
ADJUSTMENTS: | |||||
Interest expense | 108 | 721 | 829 | ||
Income tax expense / (benefit) | 3 | 94 | 97 | ||
Depreciation | 555 | 3,178 | 3,733 | ||
Intangible asset amortization | 503 | 2,408 | 2,911 | ||
EBITDA | $ (14,095) | $ (2,248) | $ (16,343) | ||
OTHER ADJUSTMENTS: | |||||
Share-based compensation (non-cash) | 3,632 | 10,588 | 14,220 | ||
Acquisition and divestiture costs | — | 2,976 | 2,976 | ||
Loss on disposal of assets | — | 28 | 28 | ||
Change in fair value of contingent consideration | — | (198) | (198) | ||
Gain on settlement of Global Cooling escrow | — | (5,115) | (5,115) | ||
Inventory reserve costs | — | $ 2,185 | $ 2,185 | ||
ADJUSTED EBITDA | $ (10,463) | $ 8,216 | $ (2,247) |
(1) | Expense allocations reflected here represent allocations made by the corporate entity for the benefit of the freezer business (Stirling Ultracold and Custom Biogenic Systems). These allocations were calculated using certain judgments and estimates based on information currently available, though actual results may differ from assumptions used to present this pro forma information. |
Last Trade: | US$26.50 |
Daily Change: | 0.12 0.45 |
Daily Volume: | 106,736 |
Market Cap: | US$1.230B |
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