Telesis Bio Reports Fourth Quarter and Full Year 2023 Financial Results
- Record BioXp kit sales of $1.0 million in Q4 2023, a 59.6% increase from the prior quarter.
- Total revenue for 2023 was $27.5 million, slightly up from 2022.
- Collaboration revenue increased by 30.7% to $8.7 million.
- Operating expenses reduced by 16.1% in 2023.
- Cost reduction activities completed in 2023, with insourced oligo supply expected to impact gross margin positively in 2024.
- Net loss of $18.3 million in Q4 2023, but the company remains focused on strategic collaborations and product development.
- Decrease in revenue for Q4 2023 compared to the same period in the prior year due to capital spending weakness.
- Net loss of $18.3 million in Q4 2023, compared to a loss of $8.1 million in the same period in the prior year.
- Cash, cash equivalents, restricted cash, and investments as of December 31, 2023, were $19.3 million, while long-term notes payable were $5.3 million.
Insights
Telesis Bio Inc.'s announcement of its Q4 and full-year financial results reflects a mixed performance amidst a challenging macroeconomic environment. The record sales of BioXp kits, with a 59.6% increase from the previous quarter and 25.9% year-over-year growth, indicate robust demand and successful market penetration for the company's mRNA synthesis kits. This product line appears to be a key driver of revenue growth, especially given the 300% growth in mRNA workflow adoption.
However, the overall revenue growth is marginal, with a slight increase from $27.4 million in 2022 to $27.5 million in 2023. This suggests that while the BioXp kits are performing well, other segments may not be contributing significantly to the top line. The 30.7% increase in collaboration revenue is a positive sign, reflecting the company's ability to leverage its technology in partnerships, such as the strategic collaboration with Pfizer.
On the cost side, the significant reduction in operating expenses by 16.1% year-over-year and the insourcing of oligo production and instrument manufacturing, are strategic moves to improve margins and control quality. These efforts are expected to enhance gross margins in 2024, which is critical for improving the bottom line. Despite these cost-cutting measures, the company recorded a non-cash goodwill impairment charge of $11.4 million, which is a concern as it may reflect a reassessment of the company's future profitability prospects.
The flat gross margin in Q4 and the net loss widening from $8.1 million in the prior year's Q4 to $18.3 million in the current year's Q4, coupled with a per-share net loss of $0.61, are indicators of the financial challenges the company faces. While the company has a solid cash position with $19.3 million in cash and equivalents, the repayment of $15.0 million under its term loan agreement and the decision not to issue forward-looking guidance may signal caution regarding future performance and market conditions.
The biotechnology sector is rapidly evolving, with mRNA technology at the forefront since its pivotal role in COVID-19 vaccines. Telesis Bio's focus on RNA and DNA synthesis solutions is well-aligned with industry trends and their BioXp kits are capitalizing on the growing demand for rapid and flexible mRNA synthesis in therapeutic discovery. The reported 300% growth in mRNA workflow adoption is a testament to the increasing importance of mRNA technology in drug discovery and development.
Telesis Bio's strategic decision to prioritize the development of its BioXp and SOLA platforms for RNA-based drug discovery workflows is likely to resonate well with the industry's direction. The collaboration with Pfizer, leveraging the SOLA platform for mRNA-based vaccines and other biopharma products, underscores the potential for these platforms to contribute to the company's long-term growth and to the advancement of mRNA therapeutics.
The insourcing of oligo production and instrument manufacturing could also be a strategic advantage, potentially leading to cost savings and improved product quality. This vertical integration may provide Telesis Bio with greater control over its supply chain, which is particularly important given recent global supply chain disruptions.
Investors and stakeholders in the biotechnology sector may view Telesis Bio's performance as a microcosm of the industry's challenges and opportunities. While the company is making strategic strides in a high-growth area, it must navigate the capital spending weakness that has affected the broader industry, as evidenced by the reported mix-shift toward lower-priced BioXp 3250 instruments and the overall flat revenue growth. The biotech market's response to these strategic initiatives will be important in determining the company's trajectory in the coming years.
The financial results of Telesis Bio Inc. present a scenario that requires careful risk assessment. The company's strategy to reduce operating expenses by 16.1% and insource key components of its supply chain is a prudent approach to managing costs and mitigating risks associated with external suppliers. However, the goodwill impairment charge of $11.4 million is a significant accounting adjustment that reflects a decrease in the assessed future profitability of the company and may indicate underlying risks.
The lack of forward-looking guidance suggests uncertainty about future performance and may reflect an internal risk assessment that predicts volatile market conditions or challenges in sustaining growth. Investors should consider the potential impact of this uncertainty on the company's future stock performance and overall valuation.
Furthermore, the repayment of a substantial term loan indicates a focus on de-leveraging, which can be a positive for risk management but also signals that the company is utilizing its cash reserves. This could limit the company's flexibility to invest in growth opportunities or weather unforeseen financial challenges.
Telesis Bio's strategic focus on mRNA technology is promising, but the industry's capital spending weakness is a risk factor that cannot be ignored. The company's ability to continue growing its BioXp kit sales and maintain high gross margins in the face of industry-wide challenges will be critical for its financial health and risk profile.
SAN DIEGO, March 28, 2024 (GLOBE NEWSWIRE) -- Telesis Bio Inc. (NASDAQ: TBIO), a leading provider of RNA and DNA solutions enabling researchers to accelerate therapeutic discovery through advanced, flexible, and rapid automated synthesis in their own lab, today announced financial results for the fourth quarter and year ended December 31, 2023. Results highlight strong BioXp® kit sales, expanding gross margin and reduced operating expense.
In discussing the results, Todd R. Nelson Ph.D., Founder and CEO of Telesis Bio said, “I’m pleased with our operating execution in a challenging macro environment during 2023. Our company experienced record BioXp kits sales and expanding gross margin against the backdrop of significant cost cutting initiatives undertaken to align our operating structure with our strategic vision for growth. We believe that our rapid and flexible mRNA synthesis kits are game-changing and unlock tremendous value by providing customers control over their screening and discovery on timelines that were not possible previously.”
Highlights
- BioXp® kit revenue for the fourth quarter of 2023 exceeded
$1.0 million , the highest level in the history of the Company, an increase of59.6% from the prior quarter and25.9% compared to the same quarter in 2022. This increase was driven by rapid adoption of highly differentiated mRNA workflows, which grew at more than300% compared to the same quarter in 2022. For the full 2023 fiscal year, BioXp kit sales increased10% compared to the prior year. - Total consolidated revenue for 2023 was
$27.5 million , up slightly from$27.4 million achieved in 2022. Total revenue, excluding BioXp instrument sales and discontinued BioFoundry Services operations, was$20.9 million for the full-year period, an increase of12.4% compared to$18.6 million for the same categories in the prior year. - Collaboration revenue for the year, driven in part by the successful achievement of several key technology milestones, was
$8.7 million , an increase of30.7% above the prior year’s collaboration revenue of$6.7 million . - Industry-wide acceptance of mRNA technology has driven the Company’s launch of BioXp mRNA de novo synthesis kits and rapid cell-free RNA synthesis solutions. These products enable customers to accelerate cell and gene therapy, vaccine and antibody discovery, and state of the art development workflows. The Company anticipates that use of RNA in drug discovery workflows will continue to grow, and it intends to prioritize continuing development of the capabilities of its highly differentiated BioXp and SOLA platforms to these workflows.
- In 2023, the Company undertook cost reduction activities to achieve significant reductions to its overall cost structure. For full-year 2023, exclusive of non-cash goodwill impairment, operating expense was
$52.1 million , a reduction of16.1% from the prior year’s operating expense level of$62.1 million . For the fourth quarter of 2023, exclusive of non-cash goodwill impairment, operating expense was$10.8 million , a reduction of24.4% from the prior year’s fourth quarter level of$14.3 million . Some of these cost reductions were completed late in the year and are not fully reflected in results for the fourth quarter of 2023. Such reductions are expected to result in favorable reductions to operating expense in 2024. - During 2023 the Company’s program to insource supply of oligos was completed and internal production now has the capacity to supply at least
70% of the Company’s ongoing oligo needs. Further, the Company has completed efforts to insource instrument manufacturing. Both efforts are expected to favorably impact gross margin and product quality in 2024. - In other recent highlights, the Company continues to pursue activities under its strategic research collaboration and license agreement with Pfizer. This program is based upon Telesis’ proprietary SOLA platform which utilizes enzymatic DNA synthesis technology for potential application by Pfizer in mRNA-based vaccines and other biopharma products.
Summary of Fourth Quarter and Full Year 2023 Financial Results
Revenue of
Gross margin at
Exclusive of a
During the fourth quarter of 2023 the Company recorded a goodwill impairment charge of
Net loss was
As of December 31, 2023, cash, cash equivalents, restricted cash, and investments were
The Company will not be issuing additional forward-looking guidance at this time.
About Telesis Bio
Telesis Bio is empowering scientists with the ability to create novel, synthetic biology-enabled solutions for many of humanity’s greatest challenges. As inventors of the industry-standard Gibson Assembly® method and the first commercial automated benchtop DNA and mRNA synthesis system, Telesis Bio is enabling rapid, accurate and reproducible writing of DNA and mRNA for numerous downstream markets. The award-winning BioXp® system consolidates, automates, and optimizes the entire synthesis, cloning and amplification workflow. As a result, it delivers virtually error-free synthesis of DNA and RNA at scale within days and hours instead of weeks or months. Scientists around the world are using the technology in their own laboratories to accelerate the design-build-test paradigm for novel, high-value products for precision medicine, biologics drug discovery, vaccine and therapeutic development, genome editing, and cell and gene therapy. Telesis Bio is a public company based in San Diego. For more information, visit www.telesisbio.com. Telesis Bio, the Telesis Bio logo, Gibson Assembly, and BioXp are trademarks of Telesis Bio Inc.
Forward-Looking Statements
This press release contains forward-looking statements. All statements other than statements of historical facts contained herein are forward-looking statements reflecting the current beliefs and expectations of management made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements include statements and guidance regarding Telesis Bio’s future financial performance as well as statements regarding the future release and success of new and existing products and services. Such statements are based on current assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially from current expectations. These risks and uncertainties, many of which are beyond our control, include risks described in the section entitled Risk Factors and elsewhere in our most recently filed Annual Report on Form 10-K which was filed with the Securities and Exchange Commission on the date of this release, March 28, 2024. These forward-looking statements speak only as of the date hereof and should not be unduly relied upon. Telesis Bio disclaims any obligation to update these forward-looking statements.
Contact:
William J. Kullback
Chief Financial Officer
bill.kullback@telesisbio.com
| Telesis Bio Inc. Selected Statements of Operations Financial Data (in thousands, except per share amounts) | |||||||||||||||
| (unaudited) | |||||||||||||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||
| Revenue: | |||||||||||||||
| Product sales | $ | 1,585 | $ | 3,482 | $ | 9,691 | $ | 10,913 | |||||||
| Service revenue | 1,438 | 1,609 | 6,291 | 7,121 | |||||||||||
| Collaboration revenue | 3,304 | 3,463 | 8,690 | 6,650 | |||||||||||
| Royalties and other revenue | 650 | 915 | 2,837 | 2,751 | |||||||||||
| Total revenue | 6,977 | 9,469 | 27,509 | 27,435 | |||||||||||
| Cost of revenue | 2,228 | 3,023 | 10,559 | 11,840 | |||||||||||
| Gross Profit | 4,749 | 6,446 | 16,950 | 15,595 | |||||||||||
| Operating expenses: | |||||||||||||||
| Research and development | 3,669 | 4,139 | 17,496 | 23,460 | |||||||||||
| Sales and marketing | 3,604 | 4,681 | 13,514 | 16,489 | |||||||||||
| General and administrative | 3,568 | 5,510 | 21,090 | 22,131 | |||||||||||
| Goodwill impairment | 11,389 | — | 11,389 | — | |||||||||||
| Total operating expenses | 22,230 | 14,330 | 63,489 | 62,080 | |||||||||||
| Loss from operations | (17,481 | ) | (7,884 | ) | (46,539 | ) | (46,485 | ) | |||||||
| Interest income | 417 | 348 | 1,743 | 738 | |||||||||||
| Interest expense | (514 | ) | (611 | ) | (3,105 | ) | (1,955 | ) | |||||||
| Change in fair value of derivative liabilities | 5 | 29 | 331 | 8 | |||||||||||
| Loss on extinguishment of debt | — | — | — | (727 | ) | ||||||||||
| Other expense, net | (111 | ) | (8 | ) | (130 | ) | (26 | ) | |||||||
| Provision for income taxes | (3 | ) | (6 | ) | (24 | ) | (24 | ) | |||||||
| Net loss | $ | (17,687 | ) | $ | (8,132 | ) | $ | (47,724 | ) | $ | (48,471 | ) | |||
| Less: redeemable convertible preferred stock dividends | (579 | ) | — | (1,300 | ) | — | |||||||||
| Net loss attributable to common stockholders | $ | (18,266 | ) | $ | (8,132 | ) | $ | (49,024 | ) | $ | (48,471 | ) | |||
| Net loss per share attributable to common stockholders—basic and diluted | $ | (0.61 | ) | $ | (0.28 | ) | $ | (1.64 | ) | $ | (1.65 | ) | |||
| Weighted average common stock outstanding—basic and diluted | 30,010,395 | 29,564,157 | 29,849,832 | 29,463,361 | |||||||||||
| Telesis Bio Inc. Selected Balance Sheet Financial Data (in thousands) | |||||||
| December 31, | December 31, | ||||||
| 2023 | 2022 | ||||||
| Balance Sheet Data: | |||||||
| Cash, restricted cash, cash equivalents and short-term investments | $ | 19,333 | $ | 43,753 | |||
| Working capital | 22,167 | 41,594 | |||||
| Total assets | 70,411 | 81,362 | |||||
| Total liabilities | 40,873 | 34,797 | |||||
| Redeemable convertible preferred stock | 29,300 | — | |||||
| Accumulated deficit | (161,465 | ) | (113,741 | ) | |||
| Total stockholders’ equity | 238 | 46,565 | |||||
FAQ
What was Telesis Bio Inc.'s (TBIO) BioXp kit revenue for the fourth quarter of 2023?
How much did collaboration revenue increase by for Telesis Bio Inc. (TBIO) in 2023?
What was the total consolidated revenue for Telesis Bio Inc. (TBIO) in 2023?
How much did operating expenses reduce by for Telesis Bio Inc. (TBIO) in 2023?
What were the highlights of Telesis Bio Inc.'s (TBIO) financial results for the fourth quarter and full year 2023?
