Tuesday, July 17, 2018 10:38:37 AM
7-16-18 Qtly CC-Transcript, PR(Fin’s Q4FY18/fye4-30-18), Avid Revs History Table
*Revs Guidance (FY’18 fye 4-30-18): $51-55mm. Current committed B/L=$57.8mm.
*Cash: 4-30-18: $42.3mm
*As of July 10, 2018, 55,793,107 shares o/s.
*10K/4-30-18 iss. 7-16-18: https://tinyurl.com/ydc8vew5
*Avid Total Revs May03-Apr18: $295.5mm
*Avid’s website: https://avidbio.com
This large post has 4 sections:
I. 7-16-18 Q4/FY18 Qtly. Earnings Conf. Call TRANSCRIPT (q/e 4-30-18)
II. 7-16-18 CDMO Press Release: Q4/FY18 Earnings & Developments
IV. Updated Table of Avid Revenues By Quarter (May’06-Current)
III. Updated O/S Shares History Table – 2006-curr.
…Recall: Avid’s FY runs May-Apr, so FY’18 = May’17-Apr’18.
((( Orig. transcript from SeekingAlpha.com [https://tinyurl.com/y7up5493 ], with numerous corrections made. )))
Link to webcast replay: http://ir.avidbio.com/events-and-presentations => https://edge.media-server.com/m6/p/7obj3szs
FULL TRANSCRIPT… 7-16-18 FY’18/Q4 Earnings Conf. Call (q/e 4-30-18) (Lias/Kinjerski/Lytle)
WELCOME & FWD-LOOKING STATEMENTS: Tim Brons, Vida Strategic Partners (IR)
ROGER LIAS (CEO) – OPENING COMMENTS:
Thank you, Tim, and thanks to all of you who've dialed in and those who are participating via webcast today. Beyond reporting our financial results for Q4/FY18 ended April 30, 2018, we have several goals for today’s call. After I’ve provided a financial overview and an update on our adoption of new ASC606 revenue recognition standard, Tracy will provide some detail regarding our new client on-boarding process and how these customers may impact our top & bottom lines throughout the year. And finally, I’ll provide our financial guidance for FY2019. I would like to start by stating that I am extremely pleased with the speed & efficiency with which we've been able to transition our business model to a pure play biologics CDMO organization. In a short period, we’ve established a targeted business development operation that is actively providing visibility for Avid Bioservices within our fast growing but competitive marketplace. I believe that the changes we’ve effected position us very well for strong growth and related efficient progression to (???) generation.
I would now like to introduce Avid Bioservices' new CFO and provide a review of our Q4 and FY2018 fiscal results. I am very pleased to be able to announce that after a comprehensive search Dan Hart will be joining the Avid Bioservices team as our new CFO. Dan brings considerable experience from both the private & public sectors. Most recently as CFO at Eno Holdings, a family of companies focused on the residential real estate market and prior to that the Senior VP and CFO with mgt. consultants, SM&A. I am exceptionally pleased that we’ve been able to attract the candidate with Dan’s experience and integrity to Avid Bioservices. Dan will formerly start his duties on August 1st and I look forward to introducing him more formerly in the coming months. Since the previous CFO’s departure, we’ve been fortunate to have an extremely experienced temporary CFO on board who has provided his considerable expertise during the yr-end process and the implementation of the new ASC606 revenue recognition procedures, which I will discuss later in my comments. Our temporary CFO will remain in place until Dan is situated in his new role, and I am very grateful to him for his invaluable assistance during the transition period.
I'll now discuss our financial results for Q4 and full year ended April 30, 2018, starting with revenues. We’ve consistently projected revenues of $50-55M for FY2018, and we’re pleased to report that we’ve achieved this goal. Revenue for the full FY2018 was $53.6M compared to $57.6M for FY2017. Revenue for FY2018/Q4 was $6.9M compared to $17.9M for the same period of the prior year. This decrease is primarily the result of a slowing in demand from our 2 lead customers, which we anticipated and as previously disclosed. In the past, we had a significant reliance on a small customer base, leaving us vulnerable to such demand fluctuations. Since January, we've been working aggressively to increase market visibility and to expand and diversify our client base. To that end, we've successfully secured mostly new customers that are currently in varying stages of being on-boarded and revenue generation, and we are in active discussions with many additional potential customers. Importantly, we’re also seeing healthy growth generated from existing customer projects. As a result, our committed backlog has increased significantly by 48.2% to $57.8M under ASC 605 revenue recognition standard compared to the backlog of $39M reported in our FY2018/Q3 earnings call. While we expect the majority of the backlog to be recognized as revenue in FY2019, it's important to point out that the backlog may cover multiple fiscal years. The highly technical & customized nature of our business makes it difficult to precisely predict in advance the amount of backlog that may be recognized as revenue in a specific FY since, for many projects, process development or technology transfer work needs to be completed prior to entering the manufacturing phase of a contract; and the phasing of revenue as subject to technical progress; project timelines may also be impacted by clinical and regulatory factors outside of the control of Avid. As a result and in common with other biologic CDMOs, our manufacturing schedule has to remain flexible and has updated on an almost continuous basis.
For both Q4 and full FY2018, margins declined as compared to the prior year periods. Gross margin for Q4 was negative 28% and gross margin for FY2018 was a negative 5%. These margins are compared to positive 34% for both Q4/FY2017 and the full FY2017. These declines in the amount of $2.8M during the quarter and $14M for the full FY were mostly driven by idle capacity during the fiscal year, and a batch failure caused by a component issue outside of Avid's control during the quarter. These margins are clearly well below our expectations for the business going forward. It's important to note that installation of our large scale fleet by 2,000L mfg. capacity in the Myford facility occurred in CY2017, and the new capacity by definition always begins life empty. In addition, it should be remembered that much of this capacity was anticipated to be acquired for the manufacturer of bavituximab. Even though fixed costs associated with highly regulated biologics manufacturing under current good mfg. practices, margins will be impacted until capacity utilization is increased. To effect the required improvements, we continue an aggressive effort to both expand our customer base and to extent current client projects to increase our backlog and enhance capacity utilization. We’ll also continue to evaluate our overall cost structure and to implement related operational efficiencies to better align it with the future needs of the business. In addition, we had anticipated seeing improved future contribution from processed development services as we expand our capabilities in this area. Avid has formally been under-served in this function that not only generates direct revenue, but is also critically important for technology transfer of existing manufacturing processes into our facilities. Importantly, it also ensures that we remain current on the many technological advances being made in the bio-processing field. In support of this is vitally important and growing component of our business, we've initiated the expansion and improvement of our Process Development Laboratories, and are delighted that Dr. Magnus Schroeder has joined Avid as VP of Process Sciences. Magnus brings many years of industry experience, including direct experience in the biologics CDMO space, and he will manage our process development function as an individual profit center for the first time in Avid's history.
Turning now to operating expenses, total SG&A expenses for Q4/FY2018 were $4.2M compared to $4.5M for Q4/FY2017. It's important to note, however, that SG&A results for Q4 included non-recurring expenses of approx. $1.2M, comprising a write-off related to previously purchased capital equipment that is no longer required to support the Avid business, and one-time charges associated with the transition to the pure play CDMO model. For the full FY2018, total SG&A expenses were $16.5M compared to $18.1M for the full FY2017. The decreases in both the quarter and the year were driven primarily by the elimination of costs associated with the Company's former drug development business and the streamlining of Avid operations. For Q4/FY2018, the Company recorded consolidated net income attributable to common stockholders of $1.6M or $.03 per share compared to consolidated net loss attributable to common stockholders of $6.7M or $.16/share for the same prior year quarter. For the full FY2018, the Company recorded a consolidated net loss attributable to common stockholders of $26.5M or $.56/share compared to consolidated net loss attributable to common stockholders of $32.8M, or $.88 /share for full FY2017. The improvements in both Q4/FY2018 quarter and the FY were primarily the result of the sale of Avid's legacy R&D assets to Oncologie Inc. for $8M and the associated discontinued operations. Cash & cash equivalents as of April 30, 2018 were $42.3M compared to $46.8M at FY ended April 30, 2017. As mentioned in February this year, the primary PS-targeting R&D assets were assigned to Oncologie Inc., an emerging biopharmaceutical company with a focus & expertise in the development of immuno-oncology assets. Under the terms of this agreement, Avid is entitled to receive $8M in upfront payments over 6 months, $6M of which has already been received according to the contractually agreed schedule. We anticipate receipt of the remaining $2M in Q2/FY2019. In addition, Avid is eligible to receive up to $95M in payments subject to Oncologie’s attainment of certain development, regulatory and commercialization milestones, as well as royalties on net sales that are upward-tiering into the mid-teens. One of the most valuable aspects of this deal is that Oncologie has also entered into a master services agreement with Avid for future contract development and manufacturing activities in support of bavituximab and potentially other products.
I would now like to take some time to discuss the new ASC606 revenue recognition standard and how it impact Avid's business and reporting. While we are pleased to have achieved our revenue guidance for the year, the comparison of Q4/2018 vs. Q4/2017 revenue highlights the very lumpy nature of the CDMO business. On May 1, 2018, we adopted the new revenue recognition standards, commonly referred to as ASC606. This new standard will have a significant impact on how we recognize and report revenue going forward, and we believe that it will decrease the variability in qtr-to-qtr & year-to-year comparisons that we've seen in the past. By way of background, we have previously recognized all revenue on any particular project or specific project component at a single point in time when all deliverables were completed. As an example, revenue from our mfg. run previously has been recognized when the drug substance has been shipped to the client and all other deliverables have been completed. As of May 1st, however, the new revenue recognition standard requires us to recognize revenue over a period of time for the majority of the services that we provide, including mfg. services. Accordingly, during FY2019, revenue for manufacturing run will now be recognized over the duration of the entire mfg. process, which might be a four month period. And the amount of revenue that we recognize will be based on the percentage of completion of that mfg. run at the end of each month. We have adopted this new standard on a modified retrospective basis. For FY2019, our statement of operations will report revenue under the new standard based on a percentage of completion for the majority of our revenue. And for comparison purposes, we will separately disclose, in the footnotes to our financial statements, the amount of revenue that would have been recognized during the FY if they have been reported under the previous point in time methodology. For future fiscal years, we will report only under the new ASC606 standard. As part of the implementation of the new standard, on May 1, 2018, we analyzed all partially completed revenue projects that were ongoing at the time. And the amount of revenue we will recognize in FY2019 will include only the amount of revenue associated which were not completed as of April 30, 2018. As an example, if $1M mfg. service was 80% complete as of April 30th then the amount of revenue we will recognize in FY2019 under ASC606 will be equal only to the value of the work yet to be completed, in other words, 20% of $1M or $200,000. The amount of revenue and associated costs related to the 80% proportion of the services that had already been completed as of April 30th and allocated to the period prior to May 1st will be reported as a one-time adjustment to retained earnings in fiscal 2019. As a result of the adoption of ASC606, therefore, Avid's forecasted revenues for the FY2019 decreased by the amount of revenue associated with projects in process, but not completed at April 30th. We estimate this decrease to be $9-12M. Revenues will also of course increase at yr-end 2019 by the proportion of revenue for ongoing programs at that time that would not have been recorded under the prior accounting standard. Additionally, the cumulative adjustment to retained earnings is in the range of $2-4M. While this change presents certain complications, over time, we believe the adoption of ASC606 will smooth our financial reporting as it eliminates much of the lumpy reporting caused by the previous standard. As such, we believe that it will provide a better indicator of Avid Bioservices business in the future, and leading us in this transition will be one of Dan Hart's first priorities as Avid's new CFO. This concludes my financial overview. I’ll now turn the call over to Tracy Kinjerski, VP of Business Operations to discuss Avid's strategy for growth.
TRACY KINJERSKI (VP/Bus.Operations) – OPENING COMMENTS:
Today, I will provide an update on our business and our recent business development activities, an overview of our current clients and product mix and review our planned approach to client and project portfolio management, going forward. For the past 25 years, Avid has operated as an excess capacity manufacturer. As such, until January of this year, we worked with only a small number of clients concurrently with one another. In fact, in FY2017, 98% of Avid’s revenue was generated by only three customers. In contrast, with recent changes in our business mission to a dedicated CDMO, during FY2018, our client mix altered rapidly with 6 customers generating 98% of Avid's revenue. We are very pleased with this diversification. That said, we recognize this model clearly demands continued market focus and increased reach to support our goals of expanding capacity utilization, growth and customer diversification. To support this effort, I am pleased to announce that, in recent week, our business development team has been significantly strengthened by the addition of Sandra Carbonneau and Michael Faughnan. Their primary focus will be to cover the U.S. and Canada with Sandy overseeing the eastern region of North America and Michael overseeing the western region. Sandy’s appointment, in particular, represents the first time that Avid has had dedicated coverage in the eastern part of the U.S., which significantly enhances our market reach. In addition, Roger and I will support international opportunities. Both Sandy and Mike are industry veterans with very long direct biologic CDMO experience at companies such as Cytovance Biologics, Lonza, and WuXi Biologics. Along with considerable knowledge of the bio-therapeutics market and services, both Sandy and Mike, bring with them a wide network of industry contacts. Combined with Roger and my network contacts and experience, I am confident that we have built an exceptional business dev. team.
All of us at Avid have been exceptionally pleased with the rapid establishment of a strong CDMO business operations function, comprised of business development, marketing and project management. In a short period of time, this effort has generated very robust market interest from a wide range of potential customers. Through our many recent discussions with members of the financial community, it has become clear that the biologics CDMO market is difficult to accurately model, and that more visibility is desired regarding our client on-boarding process and how a new client impacts our financial performance during a specified period of time. Every client program we undertake is customized. There is simply no one size fits all models that will deliver realistic and reliable forward-looking forecast. Biologic contract manufacturing is a long slow-earn business that cannot be accurately analyzed over short time cycles. Sale cycles are long and incredibly complex. Once the customer has been signed, it still takes time to transition project to the higher revenue generating manufacturing phase, regardless of whether we are developing a new process on behalf of an early stage customer or transferring in an established client process to support validation and commercial manufacturing campaigns. Not all early stage programs and not all later stage or commercial programs are created equally, nor do they advance from the standard or typical timeline. By way of illustration, we currently have early stage projects that may require single GMP manufacturing batch at 200 liters scale to serve this one clinical requirement, while another project appearing similar on paper might require multiple batches at 1,000L scale for early phase clinical trial purposes. Additionally, one process development program may require 6 months before progressing to clinical manufacturing and another may require 18 or 24 months. Equally, we have current clients requiring commercial manufacturing at differing volumetric scales ranging from 200-2000 liters. Product mix also significantly impacts our revenue opportunity. In addition to seeking later stage and typically larger scale manufacturing opportunities to increase capacity utilization, it is imperative that we also continue to convert opportunities for process development and clinical stage manufacturing work. Not only are these earlier stage projects immediately revenue generating are profitable, but they will also deliver strong and high probability pipeline of future late-stage and commercial manufacturing opportunities and assurance of capacity utilization. The highly complex technical & regulatory attributes of our business render very sticky, making it unusual early stage projects to transfer elsewhere as they progress to later stage development and manufacturing, unless driven by un-resolvable capacity limitation or by the previous manufacturer's inability to deliver commercial compliance of the type Avid has been providing for the past 15 years. Our aim is to focus our resources on identifying contracting and maintaining a diverse mix of clients and project portfolios, enabling us over the long-term to fill current capacity and to preemptively predict the need for expansion of capacity to ensure we can meet client needs and for the retention of the long-term clients.
In addition to new clients and projects, it is extremely important to understand that the expansion of existing client projects is a high probability and a very important component of our future growth. I am pleased to confirm that we are seeing excellent growth and potential from within our current customer base and the expansion of existing projects as they progress through development, and also for new projects recently contracted. We are proud of the high percentage of our client base, which represents repeat business. By way of examples, we have an existing client for whom we started work on a single product in 2017, and for whom we are now working development of 3 different products with the 4th under discussion. Similarly, one of the new clients that which signed within the past 6 months while still-in-process development has already approached us about the potential for additional manufacturing batches beyond those initially scoped for that project. Project expansion as well as on-boarding of new projects will contribute considerably to future level growth. In summary, we are very pleased with the progress we have made acquiring new clients and the advancement of activities with our existing clients. That concludes my overview for today. I'll now turn the call back over to Roger.
ROGER LIAS (CEO) – FOLLOWUP COMMENTS:
Thank you, Tracy, for a great update on our business development activities and on our client mix. We will be looking forward to providing additional granularity during the remainder of the financial year. FY2018 was a restructuring year for the Company and FY2019 represents the transition. Today, Avid’s customer base and project mix are broader and more diverse that at any time in the past but it is our goal to continue to build new and existing client relationships with emerging biopharmaceutical companies and pharmaceutical multinationals alike, both domestically and in international markets. With our newest clients now making a meaningful contribution to revenue, we believe we have already significantly mitigated the risk associated with reliance on too new clients, and we continue to expand our customer base to further reduce this risk and to build a position of greater strength to support a breakthrough year in FY2020. While immediate focus is on filling capacity and driving revenue growth from our current mammalian derived drug substance service offering, the opportunity to expand Avid's offering with upstream from core areas of experience and expertise leading to significantly expand business development reach are considerable. In addition to organic growth of the current offering, examples of immediately adjacent potential future expansion opportunities include drug product manufacture and support of clinical stage clients, manufacturer proteins derived from microbial fermentation and expansion of our development services in areas such as cell line development, cell banking formulation development, analytical services and so on. We will assess future growth opportunities in the coming months. Beyond these areas, we watch with interest the growth in demand for services related to biosimilars manufacturer associated with gene therapy and immuno-cellular therapy such as CAR-T products. While diversion rates present, all represent potential future opportunities for Avid Bioservices. Finally, with the backdrop of the CDMO landscape and our escalating business development activities, we provide revenue guidance for the full FY2019 of $51-55M under the new ASC606 revenue recognition standard based on our current backlog of $57.8M and current assumptions. It should be remembered that $9-12M of revenue that may have been recognized during the FY under the previous ASC605 revenue recognition standard, it moves to retained earnings.
Given our financial expectations for FY2019 along with the indications of interest we are receiving from multiple existing and potential new customers, we believe that we are well-positioned for cash generation and on the path to achieving breakeven. Despite our confidence, we're not currently in a position to assign exact timing to when we may achieve this goal, or the current backlog potentially recognizable during this FY positions us extremely well. And we believe that we will be successful in on-boarding multiple additional new customers this year as previously discussed early stage project timelines are variable. Timing of conversion of backlog to revenue cannot be predicted with certainty and maybe adjusted based on customer and regulatory or clinical variables that are out of Avid's control or based on scientific and technical progress on the project. We are basing guidance on our current business snapshot and on conservative assumptions. I believe that taking this approach to reporting at this juncture is in the best interest of Avid, and that we will be able to provide considerably more granularity and guidance at the timing of breakeven as the year progresses, and we will update accordingly. This concludes my prepared remarks for today. And I will now open the call up to questions, operator?
Q&A: [beg. 26:30]
1. Joe Pantginis - H.C. Wainwright
JP: ”With regard to expanding your customer base, can you discuss what types of companies you’re getting interest from, and as well are any of those companies ex-U.S.?”
Roger Lias: I am pleased to say we, and I'll allow Tracy to make a few comments as well, but I'll kick off. We're getting interest from across the spectrum. We get interest from perhaps traditional emerging entrepreneurial biotech companies certainly plenty of it, but also we entertained a good deal of different interest from pharmaceutical multinationals. The difference really between the two is the timing with which they move and their planning and the business development cycles. We're able to typically covert the more fast-paced entrepreneurial opportunities more quickly whereas the pharmaceutical multinationals are very often planning years in ahead. And they also typically have a much more involved process, involving numerous audits not just quality but the DH&S. We host these on a regular basis and that's I think a good sign looking forward. With respect to where they come from, we're still proactively looking primarily, I wouldn’t say the U.S., I should say North America. We have Canadian interest as well. And we are currently dealing with international enquiries somewhat more reactively based on resource availability. But we do currently have on-board, we have existing clients and both within U.S. and from Southeast Asia. So I expect that international interest to increase.
JP: ”And then not to put you on the spot, but I want to do focus on Avid eventually with a question from a macro standpoint. The Biologics arena has been really expanding from a macro standpoint. How are you seeing the overall CDMO market develop, right now? And where do you see Avid fitting in based on your flexibility across the spectrum?”
Roger Lias: The overall market is very strong. I think we can agree, off of top of my head, some examples. I think, Zion Market Research has the value of the overall global biologics outsourcing market, I think in excess of $8B back in 2016, and they were predicting growth of $23B area in 2024. I think that’s a growth rate of around 17% over that period. And that’s supported I think by similar data from Frost & Sullivan and others. More specifically, of course, we specialize in mammalian manufacturing. We don't currently do microbial manufacturing. And certainly over 90% of all the biologic license applications filed with the FDA, to-date I think has been from the types of technology that we offer to our client base. So I think, overall, the market is very strong. It is competitive with huge barriers to entry but we’re seeing our competitors expand as markets grow. But I think we’re very well situated. We’re in the unusual position of being both agile enough to take on the earlier phase work and to meet the needs of that entrepreneurial side of the market and the earlier phase clinical but of course we also being releasing commercial products to the marketplace for 15 years now. And we have truly state-of-the-art micro facility with capacity available. So we feel very well about where we’re positioned within the marketplace.
2. Paul Knight - Janney Montgomery
PK: ”Could you talk about the 5 master service agreements one in the quarter, Phase II/I preclinical, could you talk to that if you can possibly?”
Roger Lias: Yes, without trying to -- obviously, one of them is in the public domain, a company called Acumen Therapeutics, but the others are not public domain. So we’re not able to, unfortunately, announce the name of the companies. These all, I would say the company-wise, they all would count in this entrepreneurial emerging biotech category, all well-funded companies but these are not pharmaceutical multinationals. The projects themselves, and I've got to go off the top of my head, was certainly we have, well, actually, I should start by saying of course we do have the master service agreement with Oncologie Inc. So that product we know very well, bavituximab was already being through Phase3 trial. So from a development perspective, CMC development perspective, that's a late phase project. The others are all I think, I’m right in saying, moving into Phase 1 clinical development. So we would have a process development and tech transfer component and then we would produce the first in human clinical materials for those clients.
PK: ”Do you have a goal for the number of MSA’s you want to strike in the he upcoming FY we’re now in?”
Roger Lias: I think that’s not a meaningful way of looking at it, Paul, to be honest, because it obviously depends, whether it could be an MSA with a relatively small work associated with it and an MSA where its huge amount of work associated with it. We’re working hard to balance our resources, so that we’re efficiently able to onboard these projects. And part of that is the expansion of the process development capabilities, but that lapse people equipment across the board. So we have to be somewhat cognizant of -- signing an MSA is one thing, but we still got to be able to do the work behind it to convert that backlog into revenue. So I don't think that's the appropriate way of thinking about it. But certainly, if we did the same again one more time, we’d have a huge amount of work on our hands to give some perspective.
PK: And lastly, could you talk about capacity? How much is built out now? How much is available?”
Roger Lias: So, the first question how much is built out? Of course, we’ve our legacy what we call the Franklin Facility, which has been in place for some time now. And that remains busy with both some commercial manufacturing in support of the Halozyme program, which is in the public domain, and also clinical manufacturing. The Myford facility, we've built out basically 50% of the available footprint, that takes us to volumetric scales of up to 3 by 2,000 liter bioreactors, but that build out also includes warehouses, quality labs, the infrastructure, if you like, the utilities necessary to support the entire footprint. So we have the opportunity to build out the remainder of that facility, which will be an additional 40,000+sf, relatively efficiently based on the design we already have there, and that would roughly triple the overall capacity of that facility. We’d be going from 1 manufacturing core to 3. And then in terms of capacity utilization, our idle capacity, as we’ve talked about previously is what hurts, not just us but anybody in our business. So we’re effectively now through these, on-boarding of these new clients starting to chip away that idle capacity. I don’t know if I have a number for you in terms of percentages.
3. Steve Schwartz - First Analysis
SS: ”If we could start off just talking about the revenue guidance, I wanted to just make sure I understand from your prepared remarks the clarity on what you just reported for FY’18 versus the guidance, because the midpoint of guidance is roughly flat. But first off, you had $4M from Oncology that came through or $6M rather…”
Roger Lias: $6M, yes…
SS: ”That came through and you are only going to get $2M in FY’19. So that’s a $4M headwind…”
Roger Lias: To be clear, Steve, that’s not revenue, per se… Because it goes to discontinued operations…
SS: ”It does, okay. That’s not factored in. You did also note though that ASC606 transition cost about $9-12M in revenue. Is that correct?”
Roger Lias: Yes, that’s correct on the front-end and of course we can't be, if you’d like, disingenuous about it. We will gain some back on the backend. But as of right now, we know roughly what obviously happened on April 30th & May 1st, we don't yet know exactly what things will look like at the end of the year. So we have to be a bit cautious in forecasting that. So I’d say for the guidance, we’ve taken pretty conservative assumptions under the, I guess the under promise and over deliver type scenario that seem to make sense to us.
SS: ”But still all that considered there’s still -- even though the numbers of what you just reported versus what you’re guiding to, doesn’t suggest revenue growth. There really is revenue growth occurring in there. Is that correct, am I understanding that correctly?”
Roger Lias: Yes, I think that's a reasonable statement.
SS: ”And then of that growth, how much is coming from existing customers expanding their work with you versus the new customers’ new projects, well new projects could be coming from existing. But I think maybe you understand the nature of my question.”
Roger Lias: Yes, and it's a great question. It's something hopefully that Tracy's remarks help to emphasize. We have to, and I think looking from outside, we tend to look obviously as new customers as being important and of course they are, and we’ll continue to bring on new customers. Those projects start small and grow over 6, 12, 18, 24 month period. So actually, I don't know honestly off the top of my head, by percentage but certainly the contribution of expansion of our existing clients is considerable. And I would suggest that that will, I've got to be careful, I'll come back to it, but that will certainly be a larger number in terms of the growth contribution than the new customers for this FY. And I should stress as well, this comes two ways. So existing customers we have projects that truly expand as in they are the scopes grow. And then also based on the way we previously contracted, we also have existing projects that are ongoing that we signed project authorizations as we go along for. They did not the entire value of those contract didn’t enter backlog, so some of the growth comes from basically, if you like, doing the work and progressing the projects. So those projects does grow and they progress.
SS: ”And looking at your gross margin, if I just apply 17% GM to Q4, essentially what I see is about $3M or $3.1M swing from what you reported vs. what might have been under, recently normal circumstances. Of that $3 million, can you parse out the impact of the idle capacity vs. the batch failure?”
Roger Lias: The idle capacity is the greater influence. Idle capacity in this business hurts everybody, so that the batch failure, as I say, it was a component issue which we really have little control over, it's unfortunate. But no, by far the larger contribution is the idle capacity.
SS: ”And am I right in thinking about that $3M or $3.1M, or am I completely crazy on that number. What are your thoughts?”
Roger Lias: I mean, probably idle capacity has probably contributed $2.8M…
SS: ”$2.8M…”
Roger Lias: Roughly to some there – thereabouts…
SS: ”And just generally speaking with respect to gross margin and in your prepared remarks you addressed the fact that it's very difficult to forecast out what the development of projects revenue is going to be. And I know gross margin goes with that. But what do you think the gross margin profile across this next year looks like? And what level do you hit a steady state and what might that gross margin level be? Is it 20%, 25%?”
Roger Lias: I'll just say improving. We have a complex mix that I think margins will tend to be better on the process development than the earlier phase business. This is just experience from many years in the industry, so there is a lot that goes into it. I think that our mix of business and how the projects progress will have -- could have quite a significant impact this year. I think once we achieve a bit more steady state and critical mass, if you like, I think it'll be easier to predict gross margins going forward years on out. But this transition year is going to be a tough one to predict in many ways.
SS: ”And then my last question, just with respect to the backlog and that figure, you made a comment that it could take, in some cases, years for some of those projects in the backlog to develop revenue. But what are your rough guidelines for, including something into that backlog tally? What's behind that number, if you could?”
Roger Lias: Yes, first, I'll just actually address the comment you made there. All of them, while some of roll back over multiple years, all of them contribute immediately. So none of them are waiting till next year to start, they're all immediately revenue generating. We take basically pretty conservative view of backlog. Backlog takes into account signed and committed contractual obligations on behalf of the customer. As I mentioned before, we previously contract these somewhat differently and we signed up for a large scope of work, but it would only actually get converted into backlog when we signed project authorizations almost a pay as you go approach under Tracy. And with the experience that both she and I have had in previous lives and we changed our contractual terms quite significantly now, so we're getting much greater commitments from the client upfront. So, at the time you sign a contract, a much greater proportion of that total value goes into backlog, because it’s committed. So we have, what I call, trailing backlog, which follows on which does not get rolled into our backlog number. So that's a very solid conservative number.
ROGER LIAS (CEO) – CLOSING COMMENTS:
So, during FY2018, we've initiated transition to a pure play biologics contract development and manufacturing organization. And today, Avid is I believe a recognized, established and well respected CDMO. We've already significantly diversified and expanded our client base, and we've bought, what I believe is an impressive new Board of Directors and established a cohesive new leadership team, with expertise spanning every area of the business from business development to process development and finance. We’re responding to and winning more request for proposal than at any time in our history, and we're well on our way to filling our available capacity with a product mix that will consist of both shorter term process development and clinical programs, as well as with longer term commercial programs. Our backlog is growing and we believe that we're on track to achieve breakeven in the delivery of positive EBITDA. While FY2018 was an impressive turnaround year for Avid, it was just our first year as a focused CDMO business. Looking ahead to FY2019, we're excited about the market opportunity and the very significant prospects for growth and market leadership that lie ahead of us. In closing, I would like to recognize the tremendous efforts, and I really do mean tremendous efforts of the staff at Avid Bioservices. The type of transition that we've affected is not easy. I remain incredibly impressed by the dedication and talent of the Avid team, and their commitment to exemplary customer service and continued industry leading compliance. So I'd like to very specifically thank them for their continued support. They without doubt remain the backbone of this business and our service offerings. So with that, I would like to conclude the call. So thank you, and have a great afternoon.
= = = = = = = = = = = = = = = = = = = = = = = = = = = = = == = = =
7-16-18: Avid Bioservices Reports Financial Results for Quarter and Fy Ended April 30, 2018 and Recent Developments
GlobalNewsWire: https://tinyurl.com/y93fux9h
-- Company Records FY 2018 Revenue of $53.6 Million
-- Committed Backlog Increases to $57.8 Million (ASC 605)
-- Customer Base Expanded and Diversified
-- Key Appointments Strengthen CDMO Leadership Team
TUSTIN, July 16, 2018: Avid Bioservices, Inc. (NASDAQ:CDMO/CDMOP), a dedicated biologics contract development and manufacturing organization (CDMO) working to improve patient lives by providing high quality development and manufacturing services to biotechnology and pharmaceutical companies, today announced financial results for the fourth quarter and fiscal year (FY) 2018 ended April 30, 2018, and provided an update on its contract manufacturing operations, and other corporate highlights.
Highlights Since January 31, 2018
“During FY2018, Avid Bioservices initiated a transition to a pure play biologics CDMO. Today, Avid is a recognized, established and well-respected service provider to the biotechnology and pharmaceutical industry,” said Roger Lias, PhD, President and CEO of Avid Bioservices. “In recent months we have significantly diversified and expanded our portfolio of customers. This effort has also fostered a steady increase in our backlog, which creates a strong foundation as we diligently pursue our goal to achieve breakeven and positive EBITDA. We have brought in an impressive new board and established a cohesive new leadership team with expertise spanning every vital facet of our business from business development to process development and finance. We are responding to, and winning, more requests for proposal than at any time in Avid’s history and we are filling our available capacity with a product mix consisting of both earlier phase process development and clinical programs, as well as late phase clinical and commercial programs. While fiscal 2018 was an impressive turnaround year for Avid, fiscal 2019 will be our first full year as a focused CDMO business and we are excited about the market opportunity and the very significant prospects for growth and market leadership that lie ahead. I would like to recognize the tremendous efforts of the staff at Avid Bioservices. The type of transition that we have effected is not easy and I remain incredibly impressed by the dedication and talent of the Avid team and their commitment to exemplary customer service and continued industry leading compliance. I would like to very specifically thank them for their continued support. Our people remain the backbone of our service offering and our business.”
RECENT CDMO DEVELOPMENTS
Appointed multiple experienced executives to strengthen the leadership team including:
* Magnus Schroeder, PhD, VP of Process Sciences. Dr. Schroeder is an accomplished scientist with more than 16 years of experience spanning bioprocess development, cGMP manufacturing, CMC strategy and global project leadership. Dr. Schroeder most recently served as a director at AGC Biologics, formerly CMC Biologics, where he participated in the successful commercial launch of multiple products.
* Sandra Carbonneau, Director, Business Development, (eastern region). Ms. Carbonneau brings to Avid more than 26 years of relevant industry experience. Previously with Lonza Biologics, Ms. Carbonneau oversaw the global mammalian commercial development business unit, including manufacturing, quality assurance, compliance and contract management.
* Michael Faughnan, Senior Director, Business Development (western region). Mr. Faughnan joins Avid with more than 20 years of customer focused sales and management experience. In particular, Mr. Faughnan has 18 years of successful biotech and CDMO sales experience with industry leading companies including Lonza and WuXi Biologics, where he contributed to significant growth.
Initiated expansion and optimization of the company’s process development capabilities and laboratory space, including:
* Expanding the total available process development laboratory space to more than 6,000 square feet;
* Upgrading the infrastructure and equipment within the existing process development laboratories;
* Implementing new state-of-the-art technologies and equipment designed to facilitate efficient, high-throughput development of upstream and downstream manufacturing processes.
The first new laboratories are expected to be operational during Q3/CY2018.
Signed 5 new master service agreements (MSAs) in the first 6 months of CY2018. This is more than Avid signed during all of CY2017. New projects under the MSAs range from process development to clinical stage biomanufacturing. All projects will contribute to revenue during FY2019.
RECENT CORPORATE DEVELOPMENTS
Entered into an Asset Assignment and Purchase Agreement with Oncologie, Inc. in February 2018 for Avid's phosphatidylserine (PS)-targeting program including bavituximab.
* Avid is entitled to receive an aggregate of $8.0 million in upfront payments over a period of 6 months, of which $6.0 million has been received according to the contractually agreed schedule. Avid will also be eligible to receive up to $95.0 million with Oncologie, Inc.’s successful achievement of development, regulatory and commercialization milestones.
* Oncologie, Inc. is responsible for all future research, development and commercialization of bavituximab, and related intellectual property costs.
* Avid is eligible to receive royalties on net sales that are upward tiering into the mid-teens.
* Oncologie has entered into an agreement with Avid for future CDMO activities in support of bavituximab and other potential products.
Completed a public offering of 10,294,445 shares of common stock in February 2018 raising gross proceeds of approximately $23.2 million.
* Avid intends to use the net proceeds from the offering to support the growth of its contract manufacturing business and general corporate purposes.
FINANCIAL HIGHLIGHTS AND GUIDANCE
* The current revenue backlog increased by 48.2% to $57.8 million from $39.0 million at the end of the third quarter of FY 2018 (ASC 605).
* The company is providing revenue guidance for the full FY 2019 of $51-55 million (ASC 606).
* Contract manufacturing revenue from Avid's clinical and commercial biomanufacturing services was $6.9 million for Q4 of FY 2018 compared to $17.9 million for the fourth quarter of FY 2017. Revenue for the full FY 2018 met guidance at $53.6 million compared to $57.6 million for full FY 2017. The decline in both the fourth quarter and FY 2018 was primarily due to previously announced lower demand from one of our largest customers.
* Gross margin for the fourth quarter of FY 2018 was negative 28%, and gross margin for full FY 2018 was negative 5%. These margins are compared to positive 34% for the fourth quarter of FY 2017 and positive 34% for the full FY 2017.
* Selling, general and administrative (S,G&A) expenses for the fourth quarter of FY 2018 were $4.2 million, compared to $4.5 million for the fourth quarter of FY 2017. For the full FY 2018, total SG&A expenses were $16.5 million, compared to $18.1 million for FY 2017. SG&A expense for the fourth quarter of FY 2018 included one-time charges totaling $1.2 million for the write-off of equipment, severance and other one-time charges. The decreases in both the fourth quarter and FY 2018 were driven primarily by lower headcount and expense reductions.
* Income from discontinued operations for the fourth quarter of FY 2018 was $9.2 million, which was primarily due to the gain on sale of certain assets to Oncologie, Inc.
* For the fourth quarter of FY 2018, the company recorded consolidated net income attributable to common stockholders of $1.6 million or $.03 per share, compared to a consolidated net loss attributable to common stockholders of $6.7 million, or $.16 per share, for the fourth quarter of FY 2017. For full FY 2018, the company recorded a consolidated net loss attributable to common stockholders of $26.5 million or $.56 per share, compared to a consolidated net loss attributable to common stockholders of $32.8 million, or $.88 per share, for full FY 2017.
Avid reported $42.3 million in cash and cash equivalents as of April 30, 2018, compared to $46.8 million on April 30, 2017.
More detailed financial information and analysis may be found in Avid’s Annual Report on Form 10-K, which will be filed with the SEC today. [10K https://tinyurl.com/ydc8vew5 ]
CONFERENCE CALL
Avid will host a conference call and webcast this afternoon, July 16, 2018, at 4:30pm EDT (1:30pm PDT). To listen to the conference call, please dial (877) 312-5443 or (253) 237-1126 and request the Avid Bioservices conference call. To listen to the live webcast, or access the archived webcast, please visit: http://ir.avidbio.com/events.cfm .
ABOUT AVID BIOSERVICES, INC.
Avid Bioservices is a dedicated contract development and manufacturing organization (CDMO) focused on development and cGMP manufacturing of biopharmaceutical products derived from mammalian cell culture. The company provides a comprehensive range of process development, high quality cGMP clinical and commercial manufacturing services for the biotechnology and biopharmaceutical industries. With 25 years of experience producing monoclonal antibodies and recombinant proteins in batch, fed-batch and perfusion modes, Avid's services include cGMP clinical and commercial product manufacturing, purification, bulk packaging, stability testing and regulatory strategy, submission and support. The company also provides a variety of process development activities, including cell line development and optimization, cell culture and feed optimization, analytical methods development and product characterization. http://www.avidbio.com
Forward-Looking *snip*
AVID BIOSERVICES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
Three Months Ended
April 30, Twelve Months Ended
April 30, 2018 2017 2018 2017
Contract manufacturing revenue $ 6,943,000 $ 17,904,000 $ 53,621,000 $ 57,630,000
Cost of contract manufacturing 8,904,000 11,782,000 56,545,000 38,259,000
Gross profit (loss) (1,961,000 ) 6,122,000 (2,924,000 ) 19,371,000
Operating expenses:
Selling, general and administrative 4,183,000 4,477,000 16,456,000 18,079,000
Restructuring charges — — 1,258,000 —
Total operating expenses 4,183,000 4,477,000 17,714,000 18,079,000
Operating income (loss) (6,144,000 ) 1,645,000 (20,638,000 ) 1,292,000
Other income (expense):
Interest and other income 19,000 37,000 102,000 108,000
Interest and other expense (9,000 ) (5,000 ) (27,000 ) (7,000 )
Income (loss) from continuing operations $ (6,134,000 ) $ 1,677,000 $ (20,563,000 ) $ 1,393,000
Income (loss) from discontinued operations 9,154,000 (6,949,000 ) (1,250,000 ) (29,552,000 )
Net income (loss) $ 3,020,000 $ (5,272,000 ) $ (21,813,000 ) $ (28,159,000 )
Comprehensive income (loss) $ 3,020,000 $ (5,272,000 ) $ (21,813,000 ) $ (28,159,000 )
Series E preferred stock accumulated
dividends (1,442,000 ) (1,442,000 ) (4,686,000 ) (4,640,000 )
Net income (loss) attributable to common stockholders $ 1,578,000 $ (6,714,000 ) $ (26,499,000 ) $ (32,799,000 )
Basic and diluted weighted average common shares outstanding: 53,360,424 42,141,720 47,063,020 37,109,493
Basic and diluted net income (loss) per common share attributable to common stockholders:
Continuing operations $ (0.14 ) $ 0.01 $ (0.53 ) $ (0.09 )
Discontinued operations $ 0.17 $ (0.17 ) $ (0.03 ) $ (0.79 )
Net income (loss) per share attributable to common stockholders $ 0.03 $ (0.16 ) $ (0.56 ) $ (0.88 )
AVID BIOSERVICES, INC.
CONSOLIDATED BALANCE SHEETS
AS OF APRIL 30, 2018 AND 2017
2018 2017
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 42,265,000 $ 46,799,000
Trade and other receivables 3,754,000 7,742,000
Inventories 16,129,000 33,099,000
Prepaid expenses 679,000 808,000
Assets of discontinued operations 5,000,000 1,426,000
Total current assets 67,827,000 89,874,000
PROPERTY AND EQUIPMENT:
Leasehold improvements 20,686,000 20,098,000
Laboratory equipment 10,258,000 10,229,000
Furniture, fixtures, office equipment and software 4,597,000 4,385,000
Construction-in-progress 3,310,000 2,841,000
38,851,000 37,553,000
Less accumulated depreciation and amortization (12,372,000 ) (11,508,000 )
Property and equipment, net 26,479,000 26,045,000
Restricted cash 1,150,000 1,150,000
Other assets 304,000 1,043,000
TOTAL ASSETS $ 95,760,000 $ 118,112,000
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 1,909,000 $ 3,000,000
Accrued payroll and related costs 2,564,000 5,055,000
Deferred revenue 10,922,000 28,500,000
Customer deposits 17,013,000 17,017,000
Other current liabilities 905,000 636,000
Liabilities of discontinued operations 4,550,000 8,723,000
Total current liabilities 37,863,000 62,931,000
Deferred rent, less current portion 2,159,000 1,599,000
Commitments and contingencies
STOCKHOLDERS' EQUITY:
Preferred stock - $.001 par value; authorized 5,000,000 shares; 1,647,760 shares issued and outstanding at April 30, 2018 and 2017, respectively 2,000 2,000
Common stock - $.001 par value; authorized 500,000,000 shares; 55,689,222 and 44,014,040 shares issued and outstanding at April 30, 2018 and 2017, respectively 55,000 44,000
Additional paid-in-capital 614,810,000 590,971,000
Accumulated deficit (559,129,000 ) (537,435,000 )
Total stockholders' equity 55,738,000 53,582,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $95,760,000 $118,112,000
CONTACTS:
• Stephanie Diaz (Investors) Vida Strategic Partners 415-675-7401 sdiaz@vidasp.com
• Tim Brons (Media) Vida Strategic Partners 415-675-7402 tbrons@vidasp.com
- - - - - - - -
From 10-Q header: “As of July 10, 2018, there were 55,793,107 shares outstanding.”
- - - - - - - - - - - - - - - - -
Latest 10K 4-30-18 iss. 7-16-18 https://tinyurl.com/ydc8vew5 PR: https://tinyurl.com/y93fux9h (Cash 4-30-18=$42.3mm)
Latest 10Q 1-31-18 iss. 3-12-18 https://tinyurl.com/yd4orsg7 PR: http://ir.avidbio.com/releasedetail.cfm?ReleaseID=1060611 (Cash 1-31-18=$17.9mm; 2-28-18=$41.7mm)
ALL SEC filings for PPHM: http://tinyurl.com/6d4jw8
= = = = = = = = = = = = = = = = = = = = = = = = = = = =
Updated PPHM REVS-BY-QTR TABLE, now thru FY18'Q4(qe 4-30-18), per the 10-Q (https://tinyurl.com/xxx7 ) issued 7-16-18.
• Total Avid Revs since May’03: $295.5mm
• 7-16-18: FY'19 (May'18-Apr'19) Avid revs guidance $51-55mm (committed B/L=$57.8mm at 4-30-18).
• Deferred-Revs at 4-30-18 total $10.9mm, UP from $6.6mm at 1-31-18.
• Cust.Deposits at 4-30-18 total $17.0mm, DOWN from $17.6mm at 1-31-18.
• Inventories at 4-30-18 total $16.1mm, UP from $14.2mm at 1-31-18.
• Avid’s Gross-Profit over last 4 qtrs: -$2.9mm(neg.) on revs of $53.6mm (GP%=-5.5%)
Avid’s website: http://www.avidbio.com
- - - - - - - - CDMO’s Fiscal Qtr’s (FY runs May – April):
FY’16-Q1 = q/e 7-31-15 – rep. 9-9-15 Wed (after mkt)
FY’16-Q2 = q/e 10-31-15 – rep. 12-10-15 Thu (after mkt)
FY’16-Q3 = q/e 1-31-16 – rep. 3-9-16 Wed (B4 mkt)
FY’16-Q4 = q/e 4-30-16 – rep. 7-14-16 Thu (after mkt)
FY’17-Q1 = q/e 7-31-16 – rep. 9-8-16 Thu (after mkt)
FY’17-Q2 = q/e 10-31-16 – rep. 12-12-16 Mon (after mkt)
FY’17-Q3 = q/e 1-31-17 – rep. 3-13-17 Mon (after mkt)
FY’17-Q4 = q/e 4-30-17 – rep. 7-14-17 Fri (after mkt)
FY’18-Q1 = q/e 7-31-17 – rep. 9-11-17 Mon (after mkt)
FY’18-Q2 = q/e 10-31-17 – rep. 12-11-17 Mon (after mkt)
FY’18-Q3 = q/e 1-31-18 – rep. 3-12-18 Mon (after mkt)
FY’18-Q4 = q/e 4-30-18 – rep. 7-16-18 Mon (after mkt)
= = = = = = = = = = = =
“Going Concern” stmt. ELIMINATED from 10-K pub. 7-11-13; RE-INSTATED in 10-K pub. 7-14-17…
2012: 4-30-12 10-K iss. 7-16-12 Pg.68: “As more fully described in Note 2, the Company’s recurring losses from operations & recurring neg. cash flows from operating activities raise substantial doubt about its ability to continue as a going concern.” http://tinyurl.com/79o57b2
2013 & 2014 & 2015 & 2016 10-K's: http://tinyurl.com/p58jcbw etc...=> (((NO GOING CONCERN STATEMENT INCLUDED.)))
2017 7-14-17: “Going Concern” re-instated in the 4-30-17 10-K (pg.13) http://tinyurl.com/ycxu4l5n
CASH a/o 1-31-14: $63.2mm
CASH a/o 2-15-14: $79.7mm
CASH a/o 4-30-14: $77.5mm
CASH a/o 6-30-14: $78.3mm
CASH a/o 7-31-14: $73.3mm
CASH a/o 10-31-14: $64.4mm
CASH a/o 1-31-15: $55.2mm
CASH a/o 4-30-15: $68.0mm
CASH a/o 7-31-15: $59.0mm
CASH a/o 10-31-15: $72.0mm
CASH a/o 1-31-16: $67.5mm
CASH a/o 4-30-16: $61.4mm
CASH a/o 7-31-16: $44.2mm
CASH a/o 10-31-16: $49.5mm
CASH a/o 1-31-17: $41.5mm
CASH a/o 4-30-17: $46.8mm
CASH a/o 7-31-17: $37.3mm
CASH a/o 10-31-17: $27.7mm
CASH a/o 1-31-18: $17.9mm
CASH a/o 2-28-18: $41.7mm
CASH a/o 4-30-18: $42.3mm
CDMO - O/S Shares History (’06–curr.)
Click here for 4/30/06–12/8/16 Peregrine Pharm. share history: https://tinyurl.com/y76cbyt5
**PPHM shares were 1:5 R/S eff. 10-19-09 (~237mm/$.64=>~47.4mm/$3.20) http://tinyurl.com/ykuw588
**PPHM shares were 1:7 R/S eff. 7-10-17 (315mm/$.606=>45mm/$4.24) http://tinyurl.com/ycohqn6j
1-31-17: 271,068,464 +13,926,930 (1-31-17 10Q iss. 3-13-17)
3-10-17: 297,709,478 +26,641,014 (“ “ “)
4-30-17: 44,014,040(x7)=308,098,280 +10,388,802 (4-30-17 10K iss. 7-14-17)
7-10-17: 45,069,188 +1,055,148 (“ “ “)
7-31-16: 45,094,154 +24,966 (7-31-17 10Q iss. 9-11-17)
8-25-17: 45,096,081 +1,927 (8-25-17 Amended 10K http://tinyurl.com/yb5jq7vc )
9-6-17: 45,096,081 nochg (7-31-17 10Q iss. 9-11-17)
10-31-16: 45,172,632 +76,551 (10-31-17 10Q iss. 12-11-17)
11-27-17: 45,210,608 +37,976 (14A/Proxy iss. 12-7-17 https://tinyurl.com/y7qprpg9 )
12-6-17: 45,212,760 +2,152 (10-31-17 10Q iss. 12-11-17)
1-8-18: 45,253,038 +40,278 (2-8-18 13D https://tinyurl.com/ya43sc3r )
1-31-18: 45,257,180 +4,142 (1-31-18 10Q iss. 3-12-18)
...2-20-18: Avid Raises ~$21.8M net, selling 10,294,445sh.@$2.25 (underwriter: Wells Fargo)
…... 8-K: https://tinyurl.com/ya3nenth 424B5: https://tinyurl.com/ycpshgxl
3-7-18: 55,552,233 +10,295,053 (1-31-18 10Q)
4-30-18: 55,689,222 +133,989 (4-30-18 10K)
7-10-18: 55,793,107 +103,885 (4-30-18 10K)
*Revs Guidance (FY’18 fye 4-30-18): $51-55mm. Current committed B/L=$57.8mm.
*Cash: 4-30-18: $42.3mm
*As of July 10, 2018, 55,793,107 shares o/s.
*10K/4-30-18 iss. 7-16-18: https://tinyurl.com/ydc8vew5
*Avid Total Revs May03-Apr18: $295.5mm
*Avid’s website: https://avidbio.com
This large post has 4 sections:
I. 7-16-18 Q4/FY18 Qtly. Earnings Conf. Call TRANSCRIPT (q/e 4-30-18)
II. 7-16-18 CDMO Press Release: Q4/FY18 Earnings & Developments
IV. Updated Table of Avid Revenues By Quarter (May’06-Current)
III. Updated O/S Shares History Table – 2006-curr.
…Recall: Avid’s FY runs May-Apr, so FY’18 = May’17-Apr’18.
((( Orig. transcript from SeekingAlpha.com [https://tinyurl.com/y7up5493 ], with numerous corrections made. )))
Link to webcast replay: http://ir.avidbio.com/events-and-presentations => https://edge.media-server.com/m6/p/7obj3szs
FULL TRANSCRIPT… 7-16-18 FY’18/Q4 Earnings Conf. Call (q/e 4-30-18) (Lias/Kinjerski/Lytle)
WELCOME & FWD-LOOKING STATEMENTS: Tim Brons, Vida Strategic Partners (IR)
ROGER LIAS (CEO) – OPENING COMMENTS:
Thank you, Tim, and thanks to all of you who've dialed in and those who are participating via webcast today. Beyond reporting our financial results for Q4/FY18 ended April 30, 2018, we have several goals for today’s call. After I’ve provided a financial overview and an update on our adoption of new ASC606 revenue recognition standard, Tracy will provide some detail regarding our new client on-boarding process and how these customers may impact our top & bottom lines throughout the year. And finally, I’ll provide our financial guidance for FY2019. I would like to start by stating that I am extremely pleased with the speed & efficiency with which we've been able to transition our business model to a pure play biologics CDMO organization. In a short period, we’ve established a targeted business development operation that is actively providing visibility for Avid Bioservices within our fast growing but competitive marketplace. I believe that the changes we’ve effected position us very well for strong growth and related efficient progression to (???) generation.
I would now like to introduce Avid Bioservices' new CFO and provide a review of our Q4 and FY2018 fiscal results. I am very pleased to be able to announce that after a comprehensive search Dan Hart will be joining the Avid Bioservices team as our new CFO. Dan brings considerable experience from both the private & public sectors. Most recently as CFO at Eno Holdings, a family of companies focused on the residential real estate market and prior to that the Senior VP and CFO with mgt. consultants, SM&A. I am exceptionally pleased that we’ve been able to attract the candidate with Dan’s experience and integrity to Avid Bioservices. Dan will formerly start his duties on August 1st and I look forward to introducing him more formerly in the coming months. Since the previous CFO’s departure, we’ve been fortunate to have an extremely experienced temporary CFO on board who has provided his considerable expertise during the yr-end process and the implementation of the new ASC606 revenue recognition procedures, which I will discuss later in my comments. Our temporary CFO will remain in place until Dan is situated in his new role, and I am very grateful to him for his invaluable assistance during the transition period.
I'll now discuss our financial results for Q4 and full year ended April 30, 2018, starting with revenues. We’ve consistently projected revenues of $50-55M for FY2018, and we’re pleased to report that we’ve achieved this goal. Revenue for the full FY2018 was $53.6M compared to $57.6M for FY2017. Revenue for FY2018/Q4 was $6.9M compared to $17.9M for the same period of the prior year. This decrease is primarily the result of a slowing in demand from our 2 lead customers, which we anticipated and as previously disclosed. In the past, we had a significant reliance on a small customer base, leaving us vulnerable to such demand fluctuations. Since January, we've been working aggressively to increase market visibility and to expand and diversify our client base. To that end, we've successfully secured mostly new customers that are currently in varying stages of being on-boarded and revenue generation, and we are in active discussions with many additional potential customers. Importantly, we’re also seeing healthy growth generated from existing customer projects. As a result, our committed backlog has increased significantly by 48.2% to $57.8M under ASC 605 revenue recognition standard compared to the backlog of $39M reported in our FY2018/Q3 earnings call. While we expect the majority of the backlog to be recognized as revenue in FY2019, it's important to point out that the backlog may cover multiple fiscal years. The highly technical & customized nature of our business makes it difficult to precisely predict in advance the amount of backlog that may be recognized as revenue in a specific FY since, for many projects, process development or technology transfer work needs to be completed prior to entering the manufacturing phase of a contract; and the phasing of revenue as subject to technical progress; project timelines may also be impacted by clinical and regulatory factors outside of the control of Avid. As a result and in common with other biologic CDMOs, our manufacturing schedule has to remain flexible and has updated on an almost continuous basis.
For both Q4 and full FY2018, margins declined as compared to the prior year periods. Gross margin for Q4 was negative 28% and gross margin for FY2018 was a negative 5%. These margins are compared to positive 34% for both Q4/FY2017 and the full FY2017. These declines in the amount of $2.8M during the quarter and $14M for the full FY were mostly driven by idle capacity during the fiscal year, and a batch failure caused by a component issue outside of Avid's control during the quarter. These margins are clearly well below our expectations for the business going forward. It's important to note that installation of our large scale fleet by 2,000L mfg. capacity in the Myford facility occurred in CY2017, and the new capacity by definition always begins life empty. In addition, it should be remembered that much of this capacity was anticipated to be acquired for the manufacturer of bavituximab. Even though fixed costs associated with highly regulated biologics manufacturing under current good mfg. practices, margins will be impacted until capacity utilization is increased. To effect the required improvements, we continue an aggressive effort to both expand our customer base and to extent current client projects to increase our backlog and enhance capacity utilization. We’ll also continue to evaluate our overall cost structure and to implement related operational efficiencies to better align it with the future needs of the business. In addition, we had anticipated seeing improved future contribution from processed development services as we expand our capabilities in this area. Avid has formally been under-served in this function that not only generates direct revenue, but is also critically important for technology transfer of existing manufacturing processes into our facilities. Importantly, it also ensures that we remain current on the many technological advances being made in the bio-processing field. In support of this is vitally important and growing component of our business, we've initiated the expansion and improvement of our Process Development Laboratories, and are delighted that Dr. Magnus Schroeder has joined Avid as VP of Process Sciences. Magnus brings many years of industry experience, including direct experience in the biologics CDMO space, and he will manage our process development function as an individual profit center for the first time in Avid's history.
Turning now to operating expenses, total SG&A expenses for Q4/FY2018 were $4.2M compared to $4.5M for Q4/FY2017. It's important to note, however, that SG&A results for Q4 included non-recurring expenses of approx. $1.2M, comprising a write-off related to previously purchased capital equipment that is no longer required to support the Avid business, and one-time charges associated with the transition to the pure play CDMO model. For the full FY2018, total SG&A expenses were $16.5M compared to $18.1M for the full FY2017. The decreases in both the quarter and the year were driven primarily by the elimination of costs associated with the Company's former drug development business and the streamlining of Avid operations. For Q4/FY2018, the Company recorded consolidated net income attributable to common stockholders of $1.6M or $.03 per share compared to consolidated net loss attributable to common stockholders of $6.7M or $.16/share for the same prior year quarter. For the full FY2018, the Company recorded a consolidated net loss attributable to common stockholders of $26.5M or $.56/share compared to consolidated net loss attributable to common stockholders of $32.8M, or $.88 /share for full FY2017. The improvements in both Q4/FY2018 quarter and the FY were primarily the result of the sale of Avid's legacy R&D assets to Oncologie Inc. for $8M and the associated discontinued operations. Cash & cash equivalents as of April 30, 2018 were $42.3M compared to $46.8M at FY ended April 30, 2017. As mentioned in February this year, the primary PS-targeting R&D assets were assigned to Oncologie Inc., an emerging biopharmaceutical company with a focus & expertise in the development of immuno-oncology assets. Under the terms of this agreement, Avid is entitled to receive $8M in upfront payments over 6 months, $6M of which has already been received according to the contractually agreed schedule. We anticipate receipt of the remaining $2M in Q2/FY2019. In addition, Avid is eligible to receive up to $95M in payments subject to Oncologie’s attainment of certain development, regulatory and commercialization milestones, as well as royalties on net sales that are upward-tiering into the mid-teens. One of the most valuable aspects of this deal is that Oncologie has also entered into a master services agreement with Avid for future contract development and manufacturing activities in support of bavituximab and potentially other products.
I would now like to take some time to discuss the new ASC606 revenue recognition standard and how it impact Avid's business and reporting. While we are pleased to have achieved our revenue guidance for the year, the comparison of Q4/2018 vs. Q4/2017 revenue highlights the very lumpy nature of the CDMO business. On May 1, 2018, we adopted the new revenue recognition standards, commonly referred to as ASC606. This new standard will have a significant impact on how we recognize and report revenue going forward, and we believe that it will decrease the variability in qtr-to-qtr & year-to-year comparisons that we've seen in the past. By way of background, we have previously recognized all revenue on any particular project or specific project component at a single point in time when all deliverables were completed. As an example, revenue from our mfg. run previously has been recognized when the drug substance has been shipped to the client and all other deliverables have been completed. As of May 1st, however, the new revenue recognition standard requires us to recognize revenue over a period of time for the majority of the services that we provide, including mfg. services. Accordingly, during FY2019, revenue for manufacturing run will now be recognized over the duration of the entire mfg. process, which might be a four month period. And the amount of revenue that we recognize will be based on the percentage of completion of that mfg. run at the end of each month. We have adopted this new standard on a modified retrospective basis. For FY2019, our statement of operations will report revenue under the new standard based on a percentage of completion for the majority of our revenue. And for comparison purposes, we will separately disclose, in the footnotes to our financial statements, the amount of revenue that would have been recognized during the FY if they have been reported under the previous point in time methodology. For future fiscal years, we will report only under the new ASC606 standard. As part of the implementation of the new standard, on May 1, 2018, we analyzed all partially completed revenue projects that were ongoing at the time. And the amount of revenue we will recognize in FY2019 will include only the amount of revenue associated which were not completed as of April 30, 2018. As an example, if $1M mfg. service was 80% complete as of April 30th then the amount of revenue we will recognize in FY2019 under ASC606 will be equal only to the value of the work yet to be completed, in other words, 20% of $1M or $200,000. The amount of revenue and associated costs related to the 80% proportion of the services that had already been completed as of April 30th and allocated to the period prior to May 1st will be reported as a one-time adjustment to retained earnings in fiscal 2019. As a result of the adoption of ASC606, therefore, Avid's forecasted revenues for the FY2019 decreased by the amount of revenue associated with projects in process, but not completed at April 30th. We estimate this decrease to be $9-12M. Revenues will also of course increase at yr-end 2019 by the proportion of revenue for ongoing programs at that time that would not have been recorded under the prior accounting standard. Additionally, the cumulative adjustment to retained earnings is in the range of $2-4M. While this change presents certain complications, over time, we believe the adoption of ASC606 will smooth our financial reporting as it eliminates much of the lumpy reporting caused by the previous standard. As such, we believe that it will provide a better indicator of Avid Bioservices business in the future, and leading us in this transition will be one of Dan Hart's first priorities as Avid's new CFO. This concludes my financial overview. I’ll now turn the call over to Tracy Kinjerski, VP of Business Operations to discuss Avid's strategy for growth.
TRACY KINJERSKI (VP/Bus.Operations) – OPENING COMMENTS:
Today, I will provide an update on our business and our recent business development activities, an overview of our current clients and product mix and review our planned approach to client and project portfolio management, going forward. For the past 25 years, Avid has operated as an excess capacity manufacturer. As such, until January of this year, we worked with only a small number of clients concurrently with one another. In fact, in FY2017, 98% of Avid’s revenue was generated by only three customers. In contrast, with recent changes in our business mission to a dedicated CDMO, during FY2018, our client mix altered rapidly with 6 customers generating 98% of Avid's revenue. We are very pleased with this diversification. That said, we recognize this model clearly demands continued market focus and increased reach to support our goals of expanding capacity utilization, growth and customer diversification. To support this effort, I am pleased to announce that, in recent week, our business development team has been significantly strengthened by the addition of Sandra Carbonneau and Michael Faughnan. Their primary focus will be to cover the U.S. and Canada with Sandy overseeing the eastern region of North America and Michael overseeing the western region. Sandy’s appointment, in particular, represents the first time that Avid has had dedicated coverage in the eastern part of the U.S., which significantly enhances our market reach. In addition, Roger and I will support international opportunities. Both Sandy and Mike are industry veterans with very long direct biologic CDMO experience at companies such as Cytovance Biologics, Lonza, and WuXi Biologics. Along with considerable knowledge of the bio-therapeutics market and services, both Sandy and Mike, bring with them a wide network of industry contacts. Combined with Roger and my network contacts and experience, I am confident that we have built an exceptional business dev. team.
All of us at Avid have been exceptionally pleased with the rapid establishment of a strong CDMO business operations function, comprised of business development, marketing and project management. In a short period of time, this effort has generated very robust market interest from a wide range of potential customers. Through our many recent discussions with members of the financial community, it has become clear that the biologics CDMO market is difficult to accurately model, and that more visibility is desired regarding our client on-boarding process and how a new client impacts our financial performance during a specified period of time. Every client program we undertake is customized. There is simply no one size fits all models that will deliver realistic and reliable forward-looking forecast. Biologic contract manufacturing is a long slow-earn business that cannot be accurately analyzed over short time cycles. Sale cycles are long and incredibly complex. Once the customer has been signed, it still takes time to transition project to the higher revenue generating manufacturing phase, regardless of whether we are developing a new process on behalf of an early stage customer or transferring in an established client process to support validation and commercial manufacturing campaigns. Not all early stage programs and not all later stage or commercial programs are created equally, nor do they advance from the standard or typical timeline. By way of illustration, we currently have early stage projects that may require single GMP manufacturing batch at 200 liters scale to serve this one clinical requirement, while another project appearing similar on paper might require multiple batches at 1,000L scale for early phase clinical trial purposes. Additionally, one process development program may require 6 months before progressing to clinical manufacturing and another may require 18 or 24 months. Equally, we have current clients requiring commercial manufacturing at differing volumetric scales ranging from 200-2000 liters. Product mix also significantly impacts our revenue opportunity. In addition to seeking later stage and typically larger scale manufacturing opportunities to increase capacity utilization, it is imperative that we also continue to convert opportunities for process development and clinical stage manufacturing work. Not only are these earlier stage projects immediately revenue generating are profitable, but they will also deliver strong and high probability pipeline of future late-stage and commercial manufacturing opportunities and assurance of capacity utilization. The highly complex technical & regulatory attributes of our business render very sticky, making it unusual early stage projects to transfer elsewhere as they progress to later stage development and manufacturing, unless driven by un-resolvable capacity limitation or by the previous manufacturer's inability to deliver commercial compliance of the type Avid has been providing for the past 15 years. Our aim is to focus our resources on identifying contracting and maintaining a diverse mix of clients and project portfolios, enabling us over the long-term to fill current capacity and to preemptively predict the need for expansion of capacity to ensure we can meet client needs and for the retention of the long-term clients.
In addition to new clients and projects, it is extremely important to understand that the expansion of existing client projects is a high probability and a very important component of our future growth. I am pleased to confirm that we are seeing excellent growth and potential from within our current customer base and the expansion of existing projects as they progress through development, and also for new projects recently contracted. We are proud of the high percentage of our client base, which represents repeat business. By way of examples, we have an existing client for whom we started work on a single product in 2017, and for whom we are now working development of 3 different products with the 4th under discussion. Similarly, one of the new clients that which signed within the past 6 months while still-in-process development has already approached us about the potential for additional manufacturing batches beyond those initially scoped for that project. Project expansion as well as on-boarding of new projects will contribute considerably to future level growth. In summary, we are very pleased with the progress we have made acquiring new clients and the advancement of activities with our existing clients. That concludes my overview for today. I'll now turn the call back over to Roger.
ROGER LIAS (CEO) – FOLLOWUP COMMENTS:
Thank you, Tracy, for a great update on our business development activities and on our client mix. We will be looking forward to providing additional granularity during the remainder of the financial year. FY2018 was a restructuring year for the Company and FY2019 represents the transition. Today, Avid’s customer base and project mix are broader and more diverse that at any time in the past but it is our goal to continue to build new and existing client relationships with emerging biopharmaceutical companies and pharmaceutical multinationals alike, both domestically and in international markets. With our newest clients now making a meaningful contribution to revenue, we believe we have already significantly mitigated the risk associated with reliance on too new clients, and we continue to expand our customer base to further reduce this risk and to build a position of greater strength to support a breakthrough year in FY2020. While immediate focus is on filling capacity and driving revenue growth from our current mammalian derived drug substance service offering, the opportunity to expand Avid's offering with upstream from core areas of experience and expertise leading to significantly expand business development reach are considerable. In addition to organic growth of the current offering, examples of immediately adjacent potential future expansion opportunities include drug product manufacture and support of clinical stage clients, manufacturer proteins derived from microbial fermentation and expansion of our development services in areas such as cell line development, cell banking formulation development, analytical services and so on. We will assess future growth opportunities in the coming months. Beyond these areas, we watch with interest the growth in demand for services related to biosimilars manufacturer associated with gene therapy and immuno-cellular therapy such as CAR-T products. While diversion rates present, all represent potential future opportunities for Avid Bioservices. Finally, with the backdrop of the CDMO landscape and our escalating business development activities, we provide revenue guidance for the full FY2019 of $51-55M under the new ASC606 revenue recognition standard based on our current backlog of $57.8M and current assumptions. It should be remembered that $9-12M of revenue that may have been recognized during the FY under the previous ASC605 revenue recognition standard, it moves to retained earnings.
Given our financial expectations for FY2019 along with the indications of interest we are receiving from multiple existing and potential new customers, we believe that we are well-positioned for cash generation and on the path to achieving breakeven. Despite our confidence, we're not currently in a position to assign exact timing to when we may achieve this goal, or the current backlog potentially recognizable during this FY positions us extremely well. And we believe that we will be successful in on-boarding multiple additional new customers this year as previously discussed early stage project timelines are variable. Timing of conversion of backlog to revenue cannot be predicted with certainty and maybe adjusted based on customer and regulatory or clinical variables that are out of Avid's control or based on scientific and technical progress on the project. We are basing guidance on our current business snapshot and on conservative assumptions. I believe that taking this approach to reporting at this juncture is in the best interest of Avid, and that we will be able to provide considerably more granularity and guidance at the timing of breakeven as the year progresses, and we will update accordingly. This concludes my prepared remarks for today. And I will now open the call up to questions, operator?
Q&A: [beg. 26:30]
1. Joe Pantginis - H.C. Wainwright
JP: ”With regard to expanding your customer base, can you discuss what types of companies you’re getting interest from, and as well are any of those companies ex-U.S.?”
Roger Lias: I am pleased to say we, and I'll allow Tracy to make a few comments as well, but I'll kick off. We're getting interest from across the spectrum. We get interest from perhaps traditional emerging entrepreneurial biotech companies certainly plenty of it, but also we entertained a good deal of different interest from pharmaceutical multinationals. The difference really between the two is the timing with which they move and their planning and the business development cycles. We're able to typically covert the more fast-paced entrepreneurial opportunities more quickly whereas the pharmaceutical multinationals are very often planning years in ahead. And they also typically have a much more involved process, involving numerous audits not just quality but the DH&S. We host these on a regular basis and that's I think a good sign looking forward. With respect to where they come from, we're still proactively looking primarily, I wouldn’t say the U.S., I should say North America. We have Canadian interest as well. And we are currently dealing with international enquiries somewhat more reactively based on resource availability. But we do currently have on-board, we have existing clients and both within U.S. and from Southeast Asia. So I expect that international interest to increase.
JP: ”And then not to put you on the spot, but I want to do focus on Avid eventually with a question from a macro standpoint. The Biologics arena has been really expanding from a macro standpoint. How are you seeing the overall CDMO market develop, right now? And where do you see Avid fitting in based on your flexibility across the spectrum?”
Roger Lias: The overall market is very strong. I think we can agree, off of top of my head, some examples. I think, Zion Market Research has the value of the overall global biologics outsourcing market, I think in excess of $8B back in 2016, and they were predicting growth of $23B area in 2024. I think that’s a growth rate of around 17% over that period. And that’s supported I think by similar data from Frost & Sullivan and others. More specifically, of course, we specialize in mammalian manufacturing. We don't currently do microbial manufacturing. And certainly over 90% of all the biologic license applications filed with the FDA, to-date I think has been from the types of technology that we offer to our client base. So I think, overall, the market is very strong. It is competitive with huge barriers to entry but we’re seeing our competitors expand as markets grow. But I think we’re very well situated. We’re in the unusual position of being both agile enough to take on the earlier phase work and to meet the needs of that entrepreneurial side of the market and the earlier phase clinical but of course we also being releasing commercial products to the marketplace for 15 years now. And we have truly state-of-the-art micro facility with capacity available. So we feel very well about where we’re positioned within the marketplace.
2. Paul Knight - Janney Montgomery
PK: ”Could you talk about the 5 master service agreements one in the quarter, Phase II/I preclinical, could you talk to that if you can possibly?”
Roger Lias: Yes, without trying to -- obviously, one of them is in the public domain, a company called Acumen Therapeutics, but the others are not public domain. So we’re not able to, unfortunately, announce the name of the companies. These all, I would say the company-wise, they all would count in this entrepreneurial emerging biotech category, all well-funded companies but these are not pharmaceutical multinationals. The projects themselves, and I've got to go off the top of my head, was certainly we have, well, actually, I should start by saying of course we do have the master service agreement with Oncologie Inc. So that product we know very well, bavituximab was already being through Phase3 trial. So from a development perspective, CMC development perspective, that's a late phase project. The others are all I think, I’m right in saying, moving into Phase 1 clinical development. So we would have a process development and tech transfer component and then we would produce the first in human clinical materials for those clients.
PK: ”Do you have a goal for the number of MSA’s you want to strike in the he upcoming FY we’re now in?”
Roger Lias: I think that’s not a meaningful way of looking at it, Paul, to be honest, because it obviously depends, whether it could be an MSA with a relatively small work associated with it and an MSA where its huge amount of work associated with it. We’re working hard to balance our resources, so that we’re efficiently able to onboard these projects. And part of that is the expansion of the process development capabilities, but that lapse people equipment across the board. So we have to be somewhat cognizant of -- signing an MSA is one thing, but we still got to be able to do the work behind it to convert that backlog into revenue. So I don't think that's the appropriate way of thinking about it. But certainly, if we did the same again one more time, we’d have a huge amount of work on our hands to give some perspective.
PK: And lastly, could you talk about capacity? How much is built out now? How much is available?”
Roger Lias: So, the first question how much is built out? Of course, we’ve our legacy what we call the Franklin Facility, which has been in place for some time now. And that remains busy with both some commercial manufacturing in support of the Halozyme program, which is in the public domain, and also clinical manufacturing. The Myford facility, we've built out basically 50% of the available footprint, that takes us to volumetric scales of up to 3 by 2,000 liter bioreactors, but that build out also includes warehouses, quality labs, the infrastructure, if you like, the utilities necessary to support the entire footprint. So we have the opportunity to build out the remainder of that facility, which will be an additional 40,000+sf, relatively efficiently based on the design we already have there, and that would roughly triple the overall capacity of that facility. We’d be going from 1 manufacturing core to 3. And then in terms of capacity utilization, our idle capacity, as we’ve talked about previously is what hurts, not just us but anybody in our business. So we’re effectively now through these, on-boarding of these new clients starting to chip away that idle capacity. I don’t know if I have a number for you in terms of percentages.
3. Steve Schwartz - First Analysis
SS: ”If we could start off just talking about the revenue guidance, I wanted to just make sure I understand from your prepared remarks the clarity on what you just reported for FY’18 versus the guidance, because the midpoint of guidance is roughly flat. But first off, you had $4M from Oncology that came through or $6M rather…”
Roger Lias: $6M, yes…
SS: ”That came through and you are only going to get $2M in FY’19. So that’s a $4M headwind…”
Roger Lias: To be clear, Steve, that’s not revenue, per se… Because it goes to discontinued operations…
SS: ”It does, okay. That’s not factored in. You did also note though that ASC606 transition cost about $9-12M in revenue. Is that correct?”
Roger Lias: Yes, that’s correct on the front-end and of course we can't be, if you’d like, disingenuous about it. We will gain some back on the backend. But as of right now, we know roughly what obviously happened on April 30th & May 1st, we don't yet know exactly what things will look like at the end of the year. So we have to be a bit cautious in forecasting that. So I’d say for the guidance, we’ve taken pretty conservative assumptions under the, I guess the under promise and over deliver type scenario that seem to make sense to us.
SS: ”But still all that considered there’s still -- even though the numbers of what you just reported versus what you’re guiding to, doesn’t suggest revenue growth. There really is revenue growth occurring in there. Is that correct, am I understanding that correctly?”
Roger Lias: Yes, I think that's a reasonable statement.
SS: ”And then of that growth, how much is coming from existing customers expanding their work with you versus the new customers’ new projects, well new projects could be coming from existing. But I think maybe you understand the nature of my question.”
Roger Lias: Yes, and it's a great question. It's something hopefully that Tracy's remarks help to emphasize. We have to, and I think looking from outside, we tend to look obviously as new customers as being important and of course they are, and we’ll continue to bring on new customers. Those projects start small and grow over 6, 12, 18, 24 month period. So actually, I don't know honestly off the top of my head, by percentage but certainly the contribution of expansion of our existing clients is considerable. And I would suggest that that will, I've got to be careful, I'll come back to it, but that will certainly be a larger number in terms of the growth contribution than the new customers for this FY. And I should stress as well, this comes two ways. So existing customers we have projects that truly expand as in they are the scopes grow. And then also based on the way we previously contracted, we also have existing projects that are ongoing that we signed project authorizations as we go along for. They did not the entire value of those contract didn’t enter backlog, so some of the growth comes from basically, if you like, doing the work and progressing the projects. So those projects does grow and they progress.
SS: ”And looking at your gross margin, if I just apply 17% GM to Q4, essentially what I see is about $3M or $3.1M swing from what you reported vs. what might have been under, recently normal circumstances. Of that $3 million, can you parse out the impact of the idle capacity vs. the batch failure?”
Roger Lias: The idle capacity is the greater influence. Idle capacity in this business hurts everybody, so that the batch failure, as I say, it was a component issue which we really have little control over, it's unfortunate. But no, by far the larger contribution is the idle capacity.
SS: ”And am I right in thinking about that $3M or $3.1M, or am I completely crazy on that number. What are your thoughts?”
Roger Lias: I mean, probably idle capacity has probably contributed $2.8M…
SS: ”$2.8M…”
Roger Lias: Roughly to some there – thereabouts…
SS: ”And just generally speaking with respect to gross margin and in your prepared remarks you addressed the fact that it's very difficult to forecast out what the development of projects revenue is going to be. And I know gross margin goes with that. But what do you think the gross margin profile across this next year looks like? And what level do you hit a steady state and what might that gross margin level be? Is it 20%, 25%?”
Roger Lias: I'll just say improving. We have a complex mix that I think margins will tend to be better on the process development than the earlier phase business. This is just experience from many years in the industry, so there is a lot that goes into it. I think that our mix of business and how the projects progress will have -- could have quite a significant impact this year. I think once we achieve a bit more steady state and critical mass, if you like, I think it'll be easier to predict gross margins going forward years on out. But this transition year is going to be a tough one to predict in many ways.
SS: ”And then my last question, just with respect to the backlog and that figure, you made a comment that it could take, in some cases, years for some of those projects in the backlog to develop revenue. But what are your rough guidelines for, including something into that backlog tally? What's behind that number, if you could?”
Roger Lias: Yes, first, I'll just actually address the comment you made there. All of them, while some of roll back over multiple years, all of them contribute immediately. So none of them are waiting till next year to start, they're all immediately revenue generating. We take basically pretty conservative view of backlog. Backlog takes into account signed and committed contractual obligations on behalf of the customer. As I mentioned before, we previously contract these somewhat differently and we signed up for a large scope of work, but it would only actually get converted into backlog when we signed project authorizations almost a pay as you go approach under Tracy. And with the experience that both she and I have had in previous lives and we changed our contractual terms quite significantly now, so we're getting much greater commitments from the client upfront. So, at the time you sign a contract, a much greater proportion of that total value goes into backlog, because it’s committed. So we have, what I call, trailing backlog, which follows on which does not get rolled into our backlog number. So that's a very solid conservative number.
ROGER LIAS (CEO) – CLOSING COMMENTS:
So, during FY2018, we've initiated transition to a pure play biologics contract development and manufacturing organization. And today, Avid is I believe a recognized, established and well respected CDMO. We've already significantly diversified and expanded our client base, and we've bought, what I believe is an impressive new Board of Directors and established a cohesive new leadership team, with expertise spanning every area of the business from business development to process development and finance. We’re responding to and winning more request for proposal than at any time in our history, and we're well on our way to filling our available capacity with a product mix that will consist of both shorter term process development and clinical programs, as well as with longer term commercial programs. Our backlog is growing and we believe that we're on track to achieve breakeven in the delivery of positive EBITDA. While FY2018 was an impressive turnaround year for Avid, it was just our first year as a focused CDMO business. Looking ahead to FY2019, we're excited about the market opportunity and the very significant prospects for growth and market leadership that lie ahead of us. In closing, I would like to recognize the tremendous efforts, and I really do mean tremendous efforts of the staff at Avid Bioservices. The type of transition that we've affected is not easy. I remain incredibly impressed by the dedication and talent of the Avid team, and their commitment to exemplary customer service and continued industry leading compliance. So I'd like to very specifically thank them for their continued support. They without doubt remain the backbone of this business and our service offerings. So with that, I would like to conclude the call. So thank you, and have a great afternoon.
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7-16-18: Avid Bioservices Reports Financial Results for Quarter and Fy Ended April 30, 2018 and Recent Developments
GlobalNewsWire: https://tinyurl.com/y93fux9h
-- Company Records FY 2018 Revenue of $53.6 Million
-- Committed Backlog Increases to $57.8 Million (ASC 605)
-- Customer Base Expanded and Diversified
-- Key Appointments Strengthen CDMO Leadership Team
TUSTIN, July 16, 2018: Avid Bioservices, Inc. (NASDAQ:CDMO/CDMOP), a dedicated biologics contract development and manufacturing organization (CDMO) working to improve patient lives by providing high quality development and manufacturing services to biotechnology and pharmaceutical companies, today announced financial results for the fourth quarter and fiscal year (FY) 2018 ended April 30, 2018, and provided an update on its contract manufacturing operations, and other corporate highlights.
Highlights Since January 31, 2018
“During FY2018, Avid Bioservices initiated a transition to a pure play biologics CDMO. Today, Avid is a recognized, established and well-respected service provider to the biotechnology and pharmaceutical industry,” said Roger Lias, PhD, President and CEO of Avid Bioservices. “In recent months we have significantly diversified and expanded our portfolio of customers. This effort has also fostered a steady increase in our backlog, which creates a strong foundation as we diligently pursue our goal to achieve breakeven and positive EBITDA. We have brought in an impressive new board and established a cohesive new leadership team with expertise spanning every vital facet of our business from business development to process development and finance. We are responding to, and winning, more requests for proposal than at any time in Avid’s history and we are filling our available capacity with a product mix consisting of both earlier phase process development and clinical programs, as well as late phase clinical and commercial programs. While fiscal 2018 was an impressive turnaround year for Avid, fiscal 2019 will be our first full year as a focused CDMO business and we are excited about the market opportunity and the very significant prospects for growth and market leadership that lie ahead. I would like to recognize the tremendous efforts of the staff at Avid Bioservices. The type of transition that we have effected is not easy and I remain incredibly impressed by the dedication and talent of the Avid team and their commitment to exemplary customer service and continued industry leading compliance. I would like to very specifically thank them for their continued support. Our people remain the backbone of our service offering and our business.”
RECENT CDMO DEVELOPMENTS
Appointed multiple experienced executives to strengthen the leadership team including:
* Magnus Schroeder, PhD, VP of Process Sciences. Dr. Schroeder is an accomplished scientist with more than 16 years of experience spanning bioprocess development, cGMP manufacturing, CMC strategy and global project leadership. Dr. Schroeder most recently served as a director at AGC Biologics, formerly CMC Biologics, where he participated in the successful commercial launch of multiple products.
* Sandra Carbonneau, Director, Business Development, (eastern region). Ms. Carbonneau brings to Avid more than 26 years of relevant industry experience. Previously with Lonza Biologics, Ms. Carbonneau oversaw the global mammalian commercial development business unit, including manufacturing, quality assurance, compliance and contract management.
* Michael Faughnan, Senior Director, Business Development (western region). Mr. Faughnan joins Avid with more than 20 years of customer focused sales and management experience. In particular, Mr. Faughnan has 18 years of successful biotech and CDMO sales experience with industry leading companies including Lonza and WuXi Biologics, where he contributed to significant growth.
Initiated expansion and optimization of the company’s process development capabilities and laboratory space, including:
* Expanding the total available process development laboratory space to more than 6,000 square feet;
* Upgrading the infrastructure and equipment within the existing process development laboratories;
* Implementing new state-of-the-art technologies and equipment designed to facilitate efficient, high-throughput development of upstream and downstream manufacturing processes.
The first new laboratories are expected to be operational during Q3/CY2018.
Signed 5 new master service agreements (MSAs) in the first 6 months of CY2018. This is more than Avid signed during all of CY2017. New projects under the MSAs range from process development to clinical stage biomanufacturing. All projects will contribute to revenue during FY2019.
RECENT CORPORATE DEVELOPMENTS
Entered into an Asset Assignment and Purchase Agreement with Oncologie, Inc. in February 2018 for Avid's phosphatidylserine (PS)-targeting program including bavituximab.
* Avid is entitled to receive an aggregate of $8.0 million in upfront payments over a period of 6 months, of which $6.0 million has been received according to the contractually agreed schedule. Avid will also be eligible to receive up to $95.0 million with Oncologie, Inc.’s successful achievement of development, regulatory and commercialization milestones.
* Oncologie, Inc. is responsible for all future research, development and commercialization of bavituximab, and related intellectual property costs.
* Avid is eligible to receive royalties on net sales that are upward tiering into the mid-teens.
* Oncologie has entered into an agreement with Avid for future CDMO activities in support of bavituximab and other potential products.
Completed a public offering of 10,294,445 shares of common stock in February 2018 raising gross proceeds of approximately $23.2 million.
* Avid intends to use the net proceeds from the offering to support the growth of its contract manufacturing business and general corporate purposes.
FINANCIAL HIGHLIGHTS AND GUIDANCE
* The current revenue backlog increased by 48.2% to $57.8 million from $39.0 million at the end of the third quarter of FY 2018 (ASC 605).
* The company is providing revenue guidance for the full FY 2019 of $51-55 million (ASC 606).
* Contract manufacturing revenue from Avid's clinical and commercial biomanufacturing services was $6.9 million for Q4 of FY 2018 compared to $17.9 million for the fourth quarter of FY 2017. Revenue for the full FY 2018 met guidance at $53.6 million compared to $57.6 million for full FY 2017. The decline in both the fourth quarter and FY 2018 was primarily due to previously announced lower demand from one of our largest customers.
* Gross margin for the fourth quarter of FY 2018 was negative 28%, and gross margin for full FY 2018 was negative 5%. These margins are compared to positive 34% for the fourth quarter of FY 2017 and positive 34% for the full FY 2017.
* Selling, general and administrative (S,G&A) expenses for the fourth quarter of FY 2018 were $4.2 million, compared to $4.5 million for the fourth quarter of FY 2017. For the full FY 2018, total SG&A expenses were $16.5 million, compared to $18.1 million for FY 2017. SG&A expense for the fourth quarter of FY 2018 included one-time charges totaling $1.2 million for the write-off of equipment, severance and other one-time charges. The decreases in both the fourth quarter and FY 2018 were driven primarily by lower headcount and expense reductions.
* Income from discontinued operations for the fourth quarter of FY 2018 was $9.2 million, which was primarily due to the gain on sale of certain assets to Oncologie, Inc.
* For the fourth quarter of FY 2018, the company recorded consolidated net income attributable to common stockholders of $1.6 million or $.03 per share, compared to a consolidated net loss attributable to common stockholders of $6.7 million, or $.16 per share, for the fourth quarter of FY 2017. For full FY 2018, the company recorded a consolidated net loss attributable to common stockholders of $26.5 million or $.56 per share, compared to a consolidated net loss attributable to common stockholders of $32.8 million, or $.88 per share, for full FY 2017.
Avid reported $42.3 million in cash and cash equivalents as of April 30, 2018, compared to $46.8 million on April 30, 2017.
More detailed financial information and analysis may be found in Avid’s Annual Report on Form 10-K, which will be filed with the SEC today. [10K https://tinyurl.com/ydc8vew5 ]
CONFERENCE CALL
Avid will host a conference call and webcast this afternoon, July 16, 2018, at 4:30pm EDT (1:30pm PDT). To listen to the conference call, please dial (877) 312-5443 or (253) 237-1126 and request the Avid Bioservices conference call. To listen to the live webcast, or access the archived webcast, please visit: http://ir.avidbio.com/events.cfm .
ABOUT AVID BIOSERVICES, INC.
Avid Bioservices is a dedicated contract development and manufacturing organization (CDMO) focused on development and cGMP manufacturing of biopharmaceutical products derived from mammalian cell culture. The company provides a comprehensive range of process development, high quality cGMP clinical and commercial manufacturing services for the biotechnology and biopharmaceutical industries. With 25 years of experience producing monoclonal antibodies and recombinant proteins in batch, fed-batch and perfusion modes, Avid's services include cGMP clinical and commercial product manufacturing, purification, bulk packaging, stability testing and regulatory strategy, submission and support. The company also provides a variety of process development activities, including cell line development and optimization, cell culture and feed optimization, analytical methods development and product characterization. http://www.avidbio.com
Forward-Looking *snip*
AVID BIOSERVICES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
Three Months Ended
April 30, Twelve Months Ended
April 30, 2018 2017 2018 2017
Contract manufacturing revenue $ 6,943,000 $ 17,904,000 $ 53,621,000 $ 57,630,000
Cost of contract manufacturing 8,904,000 11,782,000 56,545,000 38,259,000
Gross profit (loss) (1,961,000 ) 6,122,000 (2,924,000 ) 19,371,000
Operating expenses:
Selling, general and administrative 4,183,000 4,477,000 16,456,000 18,079,000
Restructuring charges — — 1,258,000 —
Total operating expenses 4,183,000 4,477,000 17,714,000 18,079,000
Operating income (loss) (6,144,000 ) 1,645,000 (20,638,000 ) 1,292,000
Other income (expense):
Interest and other income 19,000 37,000 102,000 108,000
Interest and other expense (9,000 ) (5,000 ) (27,000 ) (7,000 )
Income (loss) from continuing operations $ (6,134,000 ) $ 1,677,000 $ (20,563,000 ) $ 1,393,000
Income (loss) from discontinued operations 9,154,000 (6,949,000 ) (1,250,000 ) (29,552,000 )
Net income (loss) $ 3,020,000 $ (5,272,000 ) $ (21,813,000 ) $ (28,159,000 )
Comprehensive income (loss) $ 3,020,000 $ (5,272,000 ) $ (21,813,000 ) $ (28,159,000 )
Series E preferred stock accumulated
dividends (1,442,000 ) (1,442,000 ) (4,686,000 ) (4,640,000 )
Net income (loss) attributable to common stockholders $ 1,578,000 $ (6,714,000 ) $ (26,499,000 ) $ (32,799,000 )
Basic and diluted weighted average common shares outstanding: 53,360,424 42,141,720 47,063,020 37,109,493
Basic and diluted net income (loss) per common share attributable to common stockholders:
Continuing operations $ (0.14 ) $ 0.01 $ (0.53 ) $ (0.09 )
Discontinued operations $ 0.17 $ (0.17 ) $ (0.03 ) $ (0.79 )
Net income (loss) per share attributable to common stockholders $ 0.03 $ (0.16 ) $ (0.56 ) $ (0.88 )
AVID BIOSERVICES, INC.
CONSOLIDATED BALANCE SHEETS
AS OF APRIL 30, 2018 AND 2017
2018 2017
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 42,265,000 $ 46,799,000
Trade and other receivables 3,754,000 7,742,000
Inventories 16,129,000 33,099,000
Prepaid expenses 679,000 808,000
Assets of discontinued operations 5,000,000 1,426,000
Total current assets 67,827,000 89,874,000
PROPERTY AND EQUIPMENT:
Leasehold improvements 20,686,000 20,098,000
Laboratory equipment 10,258,000 10,229,000
Furniture, fixtures, office equipment and software 4,597,000 4,385,000
Construction-in-progress 3,310,000 2,841,000
38,851,000 37,553,000
Less accumulated depreciation and amortization (12,372,000 ) (11,508,000 )
Property and equipment, net 26,479,000 26,045,000
Restricted cash 1,150,000 1,150,000
Other assets 304,000 1,043,000
TOTAL ASSETS $ 95,760,000 $ 118,112,000
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 1,909,000 $ 3,000,000
Accrued payroll and related costs 2,564,000 5,055,000
Deferred revenue 10,922,000 28,500,000
Customer deposits 17,013,000 17,017,000
Other current liabilities 905,000 636,000
Liabilities of discontinued operations 4,550,000 8,723,000
Total current liabilities 37,863,000 62,931,000
Deferred rent, less current portion 2,159,000 1,599,000
Commitments and contingencies
STOCKHOLDERS' EQUITY:
Preferred stock - $.001 par value; authorized 5,000,000 shares; 1,647,760 shares issued and outstanding at April 30, 2018 and 2017, respectively 2,000 2,000
Common stock - $.001 par value; authorized 500,000,000 shares; 55,689,222 and 44,014,040 shares issued and outstanding at April 30, 2018 and 2017, respectively 55,000 44,000
Additional paid-in-capital 614,810,000 590,971,000
Accumulated deficit (559,129,000 ) (537,435,000 )
Total stockholders' equity 55,738,000 53,582,000
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $95,760,000 $118,112,000
CONTACTS:
• Stephanie Diaz (Investors) Vida Strategic Partners 415-675-7401 sdiaz@vidasp.com
• Tim Brons (Media) Vida Strategic Partners 415-675-7402 tbrons@vidasp.com
- - - - - - - -
From 10-Q header: “As of July 10, 2018, there were 55,793,107 shares outstanding.”
- - - - - - - - - - - - - - - - -
Latest 10K 4-30-18 iss. 7-16-18 https://tinyurl.com/ydc8vew5 PR: https://tinyurl.com/y93fux9h (Cash 4-30-18=$42.3mm)
Latest 10Q 1-31-18 iss. 3-12-18 https://tinyurl.com/yd4orsg7 PR: http://ir.avidbio.com/releasedetail.cfm?ReleaseID=1060611 (Cash 1-31-18=$17.9mm; 2-28-18=$41.7mm)
ALL SEC filings for PPHM: http://tinyurl.com/6d4jw8
= = = = = = = = = = = = = = = = = = = = = = = = = = = =
Updated PPHM REVS-BY-QTR TABLE, now thru FY18'Q4(qe 4-30-18), per the 10-Q (https://tinyurl.com/xxx7 ) issued 7-16-18.
• Total Avid Revs since May’03: $295.5mm
• 7-16-18: FY'19 (May'18-Apr'19) Avid revs guidance $51-55mm (committed B/L=$57.8mm at 4-30-18).
• Deferred-Revs at 4-30-18 total $10.9mm, UP from $6.6mm at 1-31-18.
• Cust.Deposits at 4-30-18 total $17.0mm, DOWN from $17.6mm at 1-31-18.
• Inventories at 4-30-18 total $16.1mm, UP from $14.2mm at 1-31-18.
• Avid’s Gross-Profit over last 4 qtrs: -$2.9mm(neg.) on revs of $53.6mm (GP%=-5.5%)
Avid’s website: http://www.avidbio.com
AVID GROSS PROFITABILITY BY QTR: DEFER CUST
QTR (1000’s) Rev$ COGS$ Prof$ GP% REV$ INVEN$ DEP.
FY13Q1 7-31-12 4,135 2,024 2,111 51% 6,056 5,744 10,224
FY13Q2 10-31-12 6,061 3,703 2,358 39% 6,221 5,426 8,500
FY13Q3 1-31-13 6,961 3,651 3,310 47% 5,061 4,635 6,729
FY13Q4 4-30-13 4,176 3,217 959 23% 4,171 4,339 8,059
FY14Q1 7-31-13 4,581 2,670 1,911 42% 4,164 5,679 8,528
FY14Q2 10-31-13 7,354 4,195 3,159 43% 3,468 4,033 7,658
FY14Q3 1-31-14 3,885 2,416 1,469 38% 4,329 5,224 8,646
FY14Q4 4-30-14 6,474 3,829 2,645 41% 5,241 5,530 5,760
FY15Q1 7-31-14 5,496 3,583 1,913 35% 4,670 5,998 6,226
FY15Q2 10-31-14 6,263 4,139 2,124 34% 3,612 5,379 7,549
FY15Q3 1-31-15 5,677 3,113 2,564 45% 5,752 6,148 8,311
FY15Q4 4-30-15 9,308 4,758 4,550 49% 6,630 7,354 11,363
FY16Q1 7-31-15 9,379 4,608 4,771 51% 8,291 10,457 9,599
FY16Q2 10-31-15 9,523 4,741 4,782 50% 9,688 12,554 14,935
FY16Q3 1-31-16 6,672 3,896 2,776 42% 15,418 15,189 22,433
FY16Q4 4-30-16 18,783 9,721 9,062 48% 15,418 15,189 24,212
FY17Q1 7-31-16 5,609 3,062 2,547 45% 21,531 25,274 21,731
FY17Q2 10-31-16 23,370 15,441 7,929 34% 17,980 25,924 26,928
FY17Q3 1-31-17 10,747 7,974 2,773 26% 26,367 33,829 26,210
FY17Q4 4-30-17 17,904 11,782 6,122 34% 28,500 33,099 17,017
FY18Q1 7-31-17 27,077 20,448 6,629 24% 13,433 24,235 14,322
FY18Q2 10-31-17 12,782 16,242 -3,460 -27% 7,473 16,518 13,138
FY18Q3 1-31-18 6,819 10,951 -4,132 -61% 6,633 14,218 17,602
FY18Q4 4-30-18 6,943 8,904 -1,961 -28% 10,922 16,129 17,013
FY13 TOTAL: 21,333 12,595 8,738 41%*
FY14 TOTAL: 22,294 13,110 9,184 41%*
FY15 TOTAL: 26,744 15,393 11,151 42%*
FY16 TOTAL: 44,357 22,966 21,391 48%*
FY17 TOTAL: 57,630 38,259 19,371 34%*
FY18 TOTAL: 53,621 56,545 -2,924 -5%*
*Avid Net-Profit(Selling/G&A) not split out from PPHM-Corp. in the fin’s.
AVID TOTAL REV’s BY YEAR):
FY04 4-30-04 3,039 (Avid-Revs didn’t incl. Avid’s Gov’t work)
FY05 4-30-05 4,684
FY06 4-30-06 3,005
FY07 4-30-07 3,492
FY08 4-30-08 5,897
FY09 4-30-09 12,963
FY10 4-30-10 13,204
FY11 4-30-11 8,502
FY12 4-30-12 14,783
FY13 4-30-13 21,333
FY14 4-30-14 22,294
FY15 4-30-15 26,744
FY16 4-30-16 44,357
FY17 4-30-17 57,630
FY18 4-30-18 53,621
**TOTAL: 295,548 (5/1/2003–4/30/18)
.
QTLY. NET PROFIT/LOSS BY QTR:
(“attributable to common stockholders”; ie, incl. PREF Div’s**)
**2-11-14: PPHM Raises $16.2M, 700k Pref. Shares w/10.5% DIV.
FY16Q1 7-31-15 -15,101,000
FY16Q2 10-31-15 -14,578,000
FY16Q3 1-31-16 -18,227,000
FY16Q4 4-30-16 -13,264,000
FY17Q1 7-31-16 -12,437,000
FY17Q2 10-31-16 -4,498,000
FY17Q3 1-31-17 -9,216,000
FY17Q4 4-30-17 -6,714,000
FY18Q1 7-31-17 -2,647,000
FY18Q2 10-31-17 -14,066,000
FY18Q3 1-31-18 -12,446,000
FY18Q4 4-30-18 +1,578,000 <=includes $9,154,000 income from disc. operations.
Period Halozyme Coherus-BioSci. Other-Custs
FYE 4-30-14 91% 8%
FYE 4-30-15 79% 9%
FYE 4-30-16 69% 26% 5%
FYE 4-30-17 58% 26% 16%
FYE 4-30-18 55% 22% 23%
- - - - - - - - CDMO’s Fiscal Qtr’s (FY runs May – April):
FY’16-Q1 = q/e 7-31-15 – rep. 9-9-15 Wed (after mkt)
FY’16-Q2 = q/e 10-31-15 – rep. 12-10-15 Thu (after mkt)
FY’16-Q3 = q/e 1-31-16 – rep. 3-9-16 Wed (B4 mkt)
FY’16-Q4 = q/e 4-30-16 – rep. 7-14-16 Thu (after mkt)
FY’17-Q1 = q/e 7-31-16 – rep. 9-8-16 Thu (after mkt)
FY’17-Q2 = q/e 10-31-16 – rep. 12-12-16 Mon (after mkt)
FY’17-Q3 = q/e 1-31-17 – rep. 3-13-17 Mon (after mkt)
FY’17-Q4 = q/e 4-30-17 – rep. 7-14-17 Fri (after mkt)
FY’18-Q1 = q/e 7-31-17 – rep. 9-11-17 Mon (after mkt)
FY’18-Q2 = q/e 10-31-17 – rep. 12-11-17 Mon (after mkt)
FY’18-Q3 = q/e 1-31-18 – rep. 3-12-18 Mon (after mkt)
FY’18-Q4 = q/e 4-30-18 – rep. 7-16-18 Mon (after mkt)
= = = = = = = = = = = =
“Going Concern” stmt. ELIMINATED from 10-K pub. 7-11-13; RE-INSTATED in 10-K pub. 7-14-17…
2012: 4-30-12 10-K iss. 7-16-12 Pg.68: “As more fully described in Note 2, the Company’s recurring losses from operations & recurring neg. cash flows from operating activities raise substantial doubt about its ability to continue as a going concern.” http://tinyurl.com/79o57b2
2013 & 2014 & 2015 & 2016 10-K's: http://tinyurl.com/p58jcbw etc...=> (((NO GOING CONCERN STATEMENT INCLUDED.)))
2017 7-14-17: “Going Concern” re-instated in the 4-30-17 10-K (pg.13) http://tinyurl.com/ycxu4l5n
CASH a/o 1-31-14: $63.2mm
CASH a/o 2-15-14: $79.7mm
CASH a/o 4-30-14: $77.5mm
CASH a/o 6-30-14: $78.3mm
CASH a/o 7-31-14: $73.3mm
CASH a/o 10-31-14: $64.4mm
CASH a/o 1-31-15: $55.2mm
CASH a/o 4-30-15: $68.0mm
CASH a/o 7-31-15: $59.0mm
CASH a/o 10-31-15: $72.0mm
CASH a/o 1-31-16: $67.5mm
CASH a/o 4-30-16: $61.4mm
CASH a/o 7-31-16: $44.2mm
CASH a/o 10-31-16: $49.5mm
CASH a/o 1-31-17: $41.5mm
CASH a/o 4-30-17: $46.8mm
CASH a/o 7-31-17: $37.3mm
CASH a/o 10-31-17: $27.7mm
CASH a/o 1-31-18: $17.9mm
CASH a/o 2-28-18: $41.7mm
CASH a/o 4-30-18: $42.3mm
CDMO - O/S Shares History (’06–curr.)
Click here for 4/30/06–12/8/16 Peregrine Pharm. share history: https://tinyurl.com/y76cbyt5
**PPHM shares were 1:5 R/S eff. 10-19-09 (~237mm/$.64=>~47.4mm/$3.20) http://tinyurl.com/ykuw588
**PPHM shares were 1:7 R/S eff. 7-10-17 (315mm/$.606=>45mm/$4.24) http://tinyurl.com/ycohqn6j
1-31-17: 271,068,464 +13,926,930 (1-31-17 10Q iss. 3-13-17)
3-10-17: 297,709,478 +26,641,014 (“ “ “)
4-30-17: 44,014,040(x7)=308,098,280 +10,388,802 (4-30-17 10K iss. 7-14-17)
7-10-17: 45,069,188 +1,055,148 (“ “ “)
7-31-16: 45,094,154 +24,966 (7-31-17 10Q iss. 9-11-17)
8-25-17: 45,096,081 +1,927 (8-25-17 Amended 10K http://tinyurl.com/yb5jq7vc )
9-6-17: 45,096,081 nochg (7-31-17 10Q iss. 9-11-17)
10-31-16: 45,172,632 +76,551 (10-31-17 10Q iss. 12-11-17)
11-27-17: 45,210,608 +37,976 (14A/Proxy iss. 12-7-17 https://tinyurl.com/y7qprpg9 )
12-6-17: 45,212,760 +2,152 (10-31-17 10Q iss. 12-11-17)
1-8-18: 45,253,038 +40,278 (2-8-18 13D https://tinyurl.com/ya43sc3r )
1-31-18: 45,257,180 +4,142 (1-31-18 10Q iss. 3-12-18)
...2-20-18: Avid Raises ~$21.8M net, selling 10,294,445sh.@$2.25 (underwriter: Wells Fargo)
…... 8-K: https://tinyurl.com/ya3nenth 424B5: https://tinyurl.com/ycpshgxl
3-7-18: 55,552,233 +10,295,053 (1-31-18 10Q)
4-30-18: 55,689,222 +133,989 (4-30-18 10K)
7-10-18: 55,793,107 +103,885 (4-30-18 10K)
Recent CDMO News
- Avid Bioservices Reports Financial Results for Third Quarter Ended January 31, 2024 • GlobeNewswire Inc. • 04/24/2024 09:25:33 PM
- Avid Bioservices Announces Receipt of Deficiency Notice from Nasdaq Regarding Late Form 10-Q • GlobeNewswire Inc. • 03/20/2024 11:00:10 AM
- Form 8-K - Current report • Edgar (US Regulatory) • 03/07/2024 11:30:11 AM
- Avid Bioservices Announces Pricing of Private Placement of Convertible Notes • GlobeNewswire Inc. • 03/07/2024 04:58:48 AM
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- Avid Bioservices Announces Certain Preliminary Financial Results for Third Quarter Ended January 31, 2024 • GlobeNewswire Inc. • 03/06/2024 09:31:28 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 03/06/2024 09:30:18 PM
- Form SC 13G/A - Statement of acquisition of beneficial ownership by individuals: [Amend] • Edgar (US Regulatory) • 01/26/2024 09:57:52 PM
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- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/12/2024 12:38:30 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/12/2024 12:37:38 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/12/2024 12:36:27 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/12/2024 12:35:47 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/11/2024 12:56:02 AM
- Form SC 13G/A - Statement of acquisition of beneficial ownership by individuals: [Amend] • Edgar (US Regulatory) • 01/08/2024 09:32:36 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/04/2024 12:56:18 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/04/2024 12:55:07 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/04/2024 12:53:58 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 01/04/2024 12:51:57 AM
- Form SC 13G - Statement of acquisition of beneficial ownership by individuals • Edgar (US Regulatory) • 12/19/2023 09:05:52 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 12/19/2023 12:34:08 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 12/19/2023 12:33:03 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 12/19/2023 12:32:11 AM
FEATURED Cannabix's Breath Logix Alcohol Device Delivers Positive Impact to Private Monitoring Agency in Montana, USA • Apr 25, 2024 8:52 AM
Bantec Reports an Over 50 Percent Increase in Sales and Profits in Q1 2024 from Q1 2023 • BANT • Apr 25, 2024 10:00 AM
Kona Gold Beverages, Inc. Announces Name Change to NuVibe, Inc. and Initiation of Ticker Symbol Application Process • KGKG • Apr 25, 2024 8:30 AM
Axis Technologies Group and Carbonis Forge Ahead with New Digital Carbon Credit Technology • AXTG • Apr 24, 2024 3:00 AM
North Bay Resources Announces Successful Equipment Test at Bishop Gold Mill, Inyo County, California • NBRI • Apr 23, 2024 9:41 AM
Epazz, Inc.: CryObo, Inc. solar Bitcoin operations will issue tokens • EPAZ • Apr 23, 2024 9:20 AM
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