Cord Blood Banking Leader Cryo-Cell Reports Fiscal First Quarter 2024 Financial Results
- Revenue for the fiscal first quarter of 2024 was $7.85 million, a slight increase from $7.82 million in 2023.
- Net income for the three months ended February 29, 2024, was approximately $556,000, down from $767,000 in the same period in 2023.
- The increase in net income was attributed to a less than 1% increase in revenue, a 5% increase in cost of sales, and a 12% increase in selling, general, and administrative expenses.
- Research, development, and related engineering expenses increased to $503,000 for the three months ended February 29, 2024, compared to $79,000 in the same period in 2023.
- The increase in R&D expenses was due to the Clinical Study and Research Agreement with Duke and expenses related to the development of a manufacturing laboratory.
- Cryo-Cell International is the world's first private cord blood bank to separate and store stem cells, established in 1992.
- Net income decreased from the previous year, indicating a potential financial challenge for the company.
- An increase in expenses, including cost of sales and selling, general, and administrative expenses, may impact the company's profitability.
- The significant rise in research, development, and related engineering expenses could strain the company's financial resources.
- The slight increase in revenue may not be sufficient to offset the higher expenses incurred by the company.
Insights
Looking at Cryo-Cell International's recently reported fiscal first-quarter results from a financial perspective, the slight revenue growth from $7.82 million to $7.85 million year-over-year is a modest positive development. However, the increase in net income is not as robust as investors might prefer, dipping from $767,000 to $556,000. This decline in profitability, particularly when revenues are nearly static, suggests that the company's operating efficiency may be under pressure.
Moreover, the substantial uptick in both cost of sales by 5% and selling, general and administrative expenses by 12% indicate escalating operational costs that the company is facing. This could be a cause for concern if the trend continues, as it may squeeze margins and affect future earnings potential.
From a market standpoint, the significant increase in R&D expenditures from $79,000 to $503,000 is an important strategic move. Cryo-Cell is showing its commitment to innovation and its long-term vision by investing heavily in the Duke IMPACT study and in developing a manufacturing laboratory. These investments could yield new treatments and revenue streams, particularly in the high-growth area of regenerative medicine.
Yet, it's important to note that such R&D projects carry significant risk and the payoffs are often long-term. Retail investors should be aware that the benefits of these investments may not be immediate and should weigh these R&D expenses against potential future benefits when considering Cryo-Cell's stock.
Financial Results
Revenue
The revenues for the first quarter of fiscal 2024 were
Net Income
The Company reported net income of approximately
About Cryo-Cell International, Inc.
Founded in 1989, Cryo-Cell International, Inc. is the world’s first private cord blood bank. More than 500,000 parents from 87 countries have entrusted Cryo-Cell International with their baby’s cord blood and cord tissue stem cells. In addition to its private bank, Cryo-Cell International has a public banking program in partnership with Duke University. Cryo-Cell’s public bank has provided cord blood for more than 600 transplantations and operates cord blood donation sites across the
Cryo-Cell’s mission is to provide the premier cord blood and cord tissue cryopreservation services, to develop, manufacture and administer cellular therapies to significantly improve the lives of patients worldwide and to offer the highest quality and most cost effective biostorage solutions available. In February 2021, Cryo-Cell entered into a license agreement with Duke University that the Company believes has allowed Cryo-Cell to begin its transformation into an autonomous, vertically integrated cellular therapy company. In March 2022, Cryo-Cell launched ExtraVault to offer its expertise in biostorage and distribution to biopharmaceutical companies and healthcare institutions. For more information, please visit (www.extravault.com).
Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In some cases, you can identify forward-looking statements by terminology such as “will,” “may,” “should,” “could,” “would,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “forecasts,” “potential” or “continue” or the negative of these terms or other comparable terminology. Generally, the words “anticipate,” “believe,” “continue,” “expect,” “intend,” “estimate,” “project,” “plan” and similar expressions identify forward-looking statements. In particular, statements about our expectations, beliefs, plans, objectives, assumptions or future events or performance contain forward-looking statements.
We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. These forward-looking statements involve risks and uncertainties and reflect only our current views, expectations and assumptions with respect to future events and our future performance. If risks or uncertainties materialize or assumptions prove incorrect, actual results or events could differ materially from those expressed or implied by such forward-looking statements. Risks that could cause actual results to differ from those expressed or implied by the forward-looking statements we make include, among others, the success of the Company’s global expansion initiatives and product diversification, including its addition of the ExtraVault services, the Company’s actual future ownership stake in future therapies emerging from its collaborative research partnerships, the success related to its IP portfolio, the Company’s future competitive position in stem cell innovation, future success of its core business and the competitive impact of public cord blood banking on the Company’s business, the success of the Company’s initiative to expand its core business units to include biopharmaceutical manufacturing and operating clinics, the complexities, uncertainties, required consents and timing related to the potential spinoff of Celle Corp., the uncertainty of profitability from its biopharmaceutical manufacturing and operating clinics, the Company’s ability to minimize future costs to the Company related to R&D initiatives and collaborations and the success of such initiatives and collaborations and the success and enforceability of the Company’s umbilical cord blood and cord tissue license agreements, together with the associated intellectual property and their ability to provide the Company with royalty fees, along with the Risk Factors set forth in the Company’s Form 10-K filed on February 28, 2024.
This list of risks and uncertainties, however, is only a summary of some of the most important factors and is not intended to be exhaustive. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. These risks and uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements. These forward-looking statements are made only as of the date hereof. Except as otherwise required by applicable law, we do not undertake and expressly disclaim any obligation to update any such statements or to publicly announce the results of any revisions to any such statements to reflect future events or developments. All subsequent written and oral forward-looking statements attributable to us, or to persons acting on our behalf, are expressly qualified in their entirety by these cautionary statements.
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Irene Smith
813-749-2102
Ismith@cryo-cell.com
Source: Cryo-Cell International, Inc.
FAQ
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