Cord Blood Banking Leader Cryo-Cell Reports Fiscal Second Quarter 2024 Financial Results

Rhea-AI Summary

Cryo-Cell International, Inc. (NYSE American: CCEL), the world's first private cord blood bank, reported its fiscal second quarter 2024 financial results. Key highlights include:

- Revenue increased 3% to $8.0 million, compared to $7.8 million in Q2 2023
- Net income rose to $656,000 ($0.08 per share), up from $221,000 ($0.03 per share) in Q2 2023
- Cost of sales decreased by 6%
- Selling, general and administrative expenses decreased by less than 1%
- R&D expenses were $241,000, down from $305,000 in Q2 2023

The company's improved performance was driven by increased processing and storage fee revenue, which offset declines in public banking revenue.

Positive

• Revenue increased by 3% year-over-year to $8.0 million
• Net income tripled to $656,000 ($0.08 per share) from $221,000 ($0.03 per share) in Q2 2023
• Cost of sales decreased by 6%, improving profit margins
• Processing and storage fee revenue grew from $7.58 million to $7.97 million

Negative

• Public banking revenue declined from $164,000 to $41,000
• R&D expenses, while lower, still represent a significant cost at $241,000

Insights

Financial Analyst

The financial performance of Cryo-Cell International, Inc. for the second quarter of fiscal 2024 reveals some key insights for investors. The company posted a 3% increase in total revenues from $7.8 million to $8.0 million year-over-year. This modest growth can be seen as positive but may be underwhelming compared to aggressive growth expectations typical in biotechnology and healthcare sectors.

Importantly, net income saw a substantial increase from $221,000 to $656,000, largely due to a 6% decrease in cost of sales. This indicates improved operational efficiency, a positive sign indicating better cost management. Additionally, the decrease in R&D expenses by $64,000 may reflect either a reduction in ongoing research activity or a shift in strategic focus. However, investors should be cautious as reduced R&D spending can impact long-term growth and innovation.

Short-term, the reduction in costs and increased efficiency signal a robust period for Cryo-Cell. Long-term, consistent revenue growth and strategic investments in R&D will be important to sustain this performance. Retail investors should note the balance between immediate financial health and potential future growth risks.

Market Research Analyst

Analyzing the market context, Cryo-Cell's performance reflects its niche position within the specialized field of cord blood banking. The marginal revenue growth of 3% indicates a relatively stable but slow-growing market. Factors contributing to this could be market saturation or competitive pressures, which investors should monitor.

Moreover, the company’s diversification strategies, such as their public banking program and partnerships with reputable institutions like Duke University, are noteworthy. This diversification not only mitigates risks but also enhances Cryo-Cell's credibility and brand value. The mention of their proprietary technology, PrepaCyte-CB, also underscores their competitive edge in cord blood processing, offering potential for differentiation in a crowded market.

From a market perspective, the company's ongoing commitment to maintaining high standards (FDA registration, FACT accreditation) ensures trust and reliability, critical for continued customer acquisition and retention. For retail investors, the steady revenue and strategic initiatives suggest potential for stable, albeit modest, returns barring any major market or regulatory disruptions.

OLDSMAR, Fla.--(BUSINESS WIRE)--

Cryo-Cell International, Inc. (NYSE American LLC: CCEL) (the “Company”), the world’s first private cord blood bank to separate and store stem cells in 1992, announced results for the fiscal second quarter ended May 31, 2024.

Financial Results

Revenue

Consolidated revenues for the second quarter of fiscal 2024 were $8.0 million compared to $7.8 million for the second quarter of fiscal 2023, a 3% increase. The revenues for the second quarter of fiscal 2024 consisted of $7.97 million in processing and storage fee revenue, $41,000 in public banking revenue and $36,000 in product revenue compared to $7.58 million in processing and storage fee revenue, $164,000 in public banking revenue and $27,000 in product revenue for the second quarter of fiscal 2023.

Net Income

The Company reported net income for the three months ended May 31, 2024 of $656,000, or $0.08 per basic and diluted shares, compared to net income of $221,000, or $0.03 per basic and diluted shares for the three months ended May 31, 2023. Net income for the three months ended May 31, 2024, resulted from a 3% increase in revenue, a decrease in cost of sales of 6%, and a less than 1% decrease in selling, general and administrative expenses. For the three months ended May 31, 2024, the Company recorded $241,000 in research, development and related engineering (“R&D”) expenses versus $305,000 for the three months ended May 31, 2023. R&D expenses as of the three months ended May 31, 2024 and 2023 include expenses related to the Clinical Study and Research Agreement the Company entered into with Duke to provide funding to complete the Duke IMPACT Study (as previously disclosed) and the expenses related to the development of a manufacturing laboratory related to the Duke License Agreement.

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 U.S in prominent hospitals such as Cedars–Sinai Hospital in ‎Los Angeles and Baptist Hospital in Miami. Cryo-Cell’s facility is FDA registered, cGMP-/cGTP-‎compliant and licensed in all states requiring licensure. Besides being AABB accredited as a ‎cord blood facility, Cryo-Cell was also the first U.S. (for private use only) cord blood bank to ‎receive FACT accreditation for adhering to the most stringent cord blood quality standards ‎set by any internationally recognized, independent accrediting organization. Cryo-Cell has ‎the exclusive rights ‎to PrepaCyte-CB, the industry’s most advanced cord blood processing ‎technology.‎

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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240715286633/en/

Irene Smith

813-749-2102

Ismith@cryo-cell.com

Source: Cryo-Cell International, Inc.

FAQ

What was Cryo-Cell's (CCEL) revenue for Q2 2024?

Cryo-Cell International (CCEL) reported revenue of $8.0 million for the second quarter of fiscal 2024, a 3% increase from $7.8 million in the same quarter of fiscal 2023.

How much did Cryo-Cell's (CCEL) net income increase in Q2 2024?

Cryo-Cell's (CCEL) net income increased significantly to $656,000 ($0.08 per share) in Q2 2024, compared to $221,000 ($0.03 per share) in Q2 2023, representing a nearly 200% increase.

What factors contributed to Cryo-Cell's (CCEL) improved financial performance in Q2 2024?

Cryo-Cell's (CCEL) improved performance in Q2 2024 was due to a 3% increase in revenue, a 6% decrease in cost of sales, and a slight decrease in selling, general and administrative expenses, resulting in higher net income.

How much did Cryo-Cell (CCEL) spend on R&D in Q2 2024?

Cryo-Cell (CCEL) reported R&D expenses of $241,000 for Q2 2024, a decrease from $305,000 in Q2 2023. These expenses are related to the Duke IMPACT Study and the development of a manufacturing laboratory.