Zomedica Reports Record Revenue of $7.3 Million for the Fourth Quarter and $25.2 Million for the Full Year 2023, Reflecting 33% Annual Growth; 69% Gross Margin and $100.5 Million in Liquidity
- Zomedica Corp. (ZOM) reported revenue growth of 33% to $25.2 million for full year 2023.
- Q4 2023 revenue increased by 19% to $7.3 million, driven by growth in Therapeutic Devices and Diagnostics segments.
- Strategic acquisitions, new product launches, and expanded manufacturing capabilities contributed to Zomedica's growth in 2023.
- The company's cash, cash equivalents, and available-for-sale securities stood at $100.5 million as of December 31, 2023.
- Zomedica reported a net loss of $34.5 million for 2023, with increased operating expenses and research costs.
- Adjusted Non-GAAP EBITDA loss for 2023 was $12.8 million.
- Increased operating expenses and research costs led to a net loss of $34.5 million for Zomedica in 2023.
- Zomedica's Adjusted Non-GAAP EBITDA loss for 2023 was $12.8 million.
- The company's net loss per share for 2023 was $0.035, compared to $0.017 per share in 2022.
Insights
The reported financial results of Zomedica demonstrate a robust revenue growth of 33% year-over-year, driven by the adoption of new products and a solid performance in the Diagnostics and Therapeutic Devices segments. The company's focus on expanding its product portfolio and manufacturing capabilities has translated into a significant increase in consumable and capital revenue. A financial analyst would highlight the impressive gross margin of 69%, which is above the industry average for medical device companies, typically ranging between 50-70%. This indicates strong pricing power and cost management despite the growth phase of the company.
However, the increase in operating expenses by 38% and research and development costs by 123% reflect the company's aggressive investment in growth and product development. While these investments are necessary for long-term sustainability, they have contributed to a net loss of $34.5 million for the year. It's important to monitor whether these investments will lead to profitability as projected. The company's cash position of $100.5 million offers some cushion, but the cash burn rate, even when adjusted for non-recurring items, warrants attention from investors.
Zomedica's strategic acquisitions, such as Structured Monitoring Products and Qorvo Biotechnologies, are set to enhance its product offerings and manufacturing efficiency. The integration of these companies could potentially improve gross margins and reduce costs associated with license fees and royalties. For stakeholders in the veterinary health sector, Zomedica's expansion into equine diagnostics and non-infectious GI testing for canines represents a diversification of its product base, meeting a broader range of veterinary needs and tapping into new market segments.
The significant growth in the Diagnostics segment, particularly the TRUFORMA product line, suggests a strong market demand for innovative veterinary diagnostic solutions. The veterinary industry is experiencing a trend towards in-house diagnostics and real-time health monitoring, which aligns with Zomedica's product development strategy. The company's focus on both companion and equine animals broadens its market reach and could lead to increased market share in a sector where pet ownership and spending on animal health are on the rise.
From a market perspective, Zomedica's reiteration of its 2024 revenue guidance, projecting a 40% increase at the high end, signals confidence in its growth trajectory and market strategy. The company's emphasis on driving increased adoption and utilization of its products, coupled with plans to launch new products in 2024, indicates a forward-looking approach aimed at capturing a larger share of the veterinary diagnostics and therapeutic devices market.
However, it's important to consider the competitive landscape and the potential challenges that Zomedica may face. The veterinary health industry is becoming increasingly competitive, with numerous players investing in similar technologies. Zomedica's success will depend on its ability to maintain its technological edge, continue to innovate and effectively market its products to veterinarians and animal health professionals. Additionally, the company's ability to execute its sales territory deployment and achieve full sales maturity will be pivotal in realizing its revenue targets.
ANN ARBOR, MI / ACCESSWIRE / April 1, 2024 / Zomedica Corp. (NYSE American:ZOM) ("Zomedica" or the "Company"), a veterinary health company offering point-of-care diagnostic and therapeutic device products for equine and companion animals, today reported consolidated financial results for the fourth quarter and year-ended December 31, 2023. All figures are in US dollars unless otherwise stated.
"The fourth quarter capped off another record quarter and year for Zomedica. On the strength of our highest revenue quarter ever, we grew full year revenue by over
"During 2023, we created a tremendous amount of momentum in the business that made multiple acquisitions, including Structured Monitoring Products, Inc. and Qorvo Biotechnologies, LLC; new product launches, including the VetGuardian® Zero-Touch Vital Signs Remote Monitoring system, the TRUVIEWTM digital cystoscopy platform, our first TRUFORMA® assay for equine diagnostics and three additional assays for canine non-infectious GI testing; and the expansion of our manufacturing capabilities in both Roswell, Georgia and Plymouth, Minnesota. With this foundation in place, and our exciting near-term portfolio expansion plans, we believe that we are very well positioned to continue our growth trajectory in 2024.
"We believe that the progress we made in 2023, and our planned growth for 2024, moves us forward nicely on our path to profitability as we grow revenues, maintain industry-leading margins and capture efficiencies in our operations," concluded Mr. Heaton.
Fourth Quarter 2023 Financial Highlights
Revenue for the fourth quarter of 2023 grew
Growth was further bolstered by:
- Consumable revenue that grew to
$4.0 million , up26% over fourth quarter 2022 consumable revenue; and, - Capital revenue that grew to
$3.3 million , up12% over fourth quarter 2022 capital revenue.
Gross margin was
Total cash used during the quarter was
Full Year 2023 Financial Highlights
Revenue for 2023 grew
Growth was further bolstered by:
- Consumable revenue that grew to
$16.4 million , reflecting41% growth over 2022 consumable revenue. Consumable revenue grew to65% of total revenues from61% in 2022; and, - Capital revenue that grew to
$8.8 million , reflecting20% growth over 2022 capital revenue.
Gross margin for full year 2023 was
Cash, Cash Equivalents and Available-for-Sale Securities were
Investment in Growth and Sustainability
During 2023, Zomedica made progress on multiple fronts, expanding its product portfolio to include five product platforms across two product segments, namely Diagnostics and Therapeutic Devices.
The commercial team, including field sales representatives, inside sales representatives, and professional services veterinarians, matured and an experienced Senior Vice President of Sales was recruited to lead the organization.
Relationships with domestic animal health distributors and online retailers were expanded and international distribution channels were solidified. Manufacturing and distribution capabilities and capacity were further expanded at the Company's Global Manufacturing & Distribution Centers in Roswell, Georgia, and Plymouth, Minnesota.
Acquisition of Structured Monitoring Products
Zomedica completed its acquisition of Structured Monitoring Products, Inc. ("SMP"), the maker of the VetGuardian Zero-Touch Vital Signs Remote Monitoring system, on September 5, 2023. This acquisition followed strategic investments by the Company in SMP beginning in May 2022, and will allow Zomedica to increase gross margin for this product line by bringing the manufacturing of VetGuardian products in-house, and also leverage both its direct sales force and animal health distributor network to drive increased adoption.
Launch of the TRUVIEW Digital Microscope
With the launch of the TRUVIEW digital microscopy system in early 2023, the Company expects revenues to continue to grow in line with the installed base in the future.
Acquisition of Qorvo Biotechnologies
On October 5th, 2023, Zomedica announced the acquisition of Qorvo Biotechnologies, LLC ("QBT"). The acquisition substantially improves the Company's ability to capture margin improvements through the assumption of QBT's manufacturing systems and also eliminates certain future payments owed to QBT by the Company, including license fees, transition fees, and future royalties. The timing of this acquisition coincided with the launch of the equine eACTH assay and the December 2023 launch of assays for canine non-infectious GI disease, Zomedica believes it will continue to capitalize on these new capabilities to bring additional assays to market, accelerating growth of the TRUFORMA® platform.
2024 Business Outlook and Financial Guidance
For the full year 2024, the Company reiterated formal financial guidance, as follows:
Zomedica continues to expect full year revenue in the range of
Zomedica believes that growth in 2024 will be driven by its existing portfolio, including recently launched products, supported by investments the Company is making to continue to drive increased adoption and utilization of its products, as well as contributions from a number of new products that the Company expects to launch during 2024. Guidance for 2024 does not incorporate any positive benefits from acquisitions the Company may make during the year.
The Company expects revenues to increase, driven by synergies derived from expanded product lines, increased sales/ marketing/commercialization efforts, and the move to full sales territory deployment, execution and maturation.
Fourth Quarter and Full Year 2023 Results
Revenue for the year ended December 31, 2023, was
Cost of revenue for the year ended December 31, 2023, was
Operating expenses for the year ended December 31, 2023, were
Research and development expense for the year ended December 31, 2023, was
Selling and marketing expense for the year ended December 31, 2023, was
General and administrative expense for the year ended December 31, 2023, was
Net loss for the year ended December 31, 2023, was
*Non-GAAP EBITDA loss (which includes adjustments for stock compensation) for the year ended December 31, 2023, was
When adjusting for one-time items associated with our transition of TRUFORMA development and manufacturing capabilities, executive transition activities, adjustments associated with our acquisitions, and one-off consulting work, our ** Adjusted Non-GAAP EBITDA loss was
Shares Outstanding
As of December 31, 2023, Zomedica had 979,949,668 common shares issued and outstanding.
For complete financial results, please see Zomedica's filings on EDGAR and SEDAR or visit the Zomedica website at www.zomedica.com.
Zomedica will host a conference call and audio-only webcast on Monday, April 1st, 2024, at 4:30 p.m. ET to discuss the Company's operational and financial highlights for its fourth quarter and full year ended December 31, 2023. A question-and-answer session will follow management's prepared remarks.
Event: Zomedica Corp. Q4 and Full Year 2023 Financial Results Conference Call
Date: Monday, April 1, 2024
Time: 4:30 p.m. Eastern Time
Live Call: +1-877-407-0789 (U.S. Toll-Free) or +1-201-689-8562 (International)
Webcast: Zomedica Q4 & Full Year 2023 Earnings Call
For interested individuals unable to join the conference call, a dial-in replay of the call will be available until Monday, April 15, 2024, at 11:59 AM ET and can be accessed by dialing +1-844-512-2921 (U.S. Toll-Free) or +1-412-317-6671 (International) and entering replay pin number: 13745341.
About Zomedica
Based in Ann Arbor, Michigan, Zomedica (NYSE American:ZOM) is a veterinary health company creating products for horses, dogs, and cats by focusing on the unmet needs of clinical veterinarians. Zomedica's product portfolio includes innovative diagnostics and medical devices that emphasize patient health and practice health. Zomedica's mission is to provide veterinarians the opportunity to increase productivity and grow revenue while better serving the animals in their care. For more information, visit www.zomedica.com.
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Representation of numbers in press release
Numbers in this press release are subject to rounding. Please refer to the 10-K for full audited figures and percentages.
Cautionary Note Regarding Forward Looking Statements
Except for statements of historical fact, this news release contains certain "forward-looking information" or "forward-looking statements" (collectively, "forward-looking information") within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur and include statements relating to our expectations regarding future results. Although we believe that the expectations reflected in the forward-looking information are reasonable, there can be no assurance that such expectations will prove to be correct. We cannot guarantee future results, performance, or achievements. Consequently, there is no representation that the actual results achieved will be the same, in whole or in part, as those set out in the forward-looking information.
Forward-looking information is based on the opinions and estimates of management at the date the statements are made, including assumptions with respect to economic growth, demand for the Company's products, the Company's ability to produce and sell its products, sufficiency of our budgeted capital and operating expenditures, the satisfaction by our strategic partners of their obligations under our commercial agreements, our ability to realize upon our business plans and cost control efforts on our business, results and financial condition.
Our forward-looking information is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking information. Some of the risks and other factors that could cause the results to differ materially from those expressed in the forward-looking information include, but are not limited to: the outcome of clinical studies, the application of generally accepted accounting principles, which are highly complex and involve many subjective assumptions, estimates, and judgments, uncertainty as to whether our strategies and business plans will yield the expected benefits; uncertainty as to the timing and results of development work and verification and validation studies; uncertainty as to the timing and results of commercialization efforts, as well as the cost of commercialization efforts, including the cost to develop an internal sales force and manage our growth; uncertainty as to our ability to successfully integrate acquisitions; uncertainty as to our ability to supply products in response to customer demand; uncertainty as to the likelihood and timing of any required regulatory approvals, and the availability and cost of capital; the ability to identify and develop and achieve commercial success for new products and technologies; veterinary acceptance of our products; competition from related products; the level of expenditures necessary to maintain and improve the quality of products and services; changes in technology and changes in laws and regulations; our ability to secure and maintain strategic relationships; performance by our strategic partners of their obligations under our commercial agreements, including product manufacturing obligations; risks pertaining to permits and licensing, intellectual property infringement risks, risks relating to any required clinical trials and regulatory approvals, risks relating to the safety and efficacy of our products, the use of our products, intellectual property protection, including our ability to develop and commercialize our products, and the other risk factors disclosed in our filings with the SEC and under our profile on SEDAR+ at www.sedarplus.ca. Readers are cautioned that this list of risk factors should not be construed as exhaustive.
The forward-looking information contained in this news release is expressly qualified by this cautionary statement. We undertake no duty to update any of the forward-looking information to conform such information to actual results or to changes in our expectations except as otherwise required by applicable securities legislation. Readers are cautioned not to place undue reliance on forward-looking information.
Investor Relations Contact:
Zomedica Investor Relations
investors@zomedica.com
1-734-369-2555
Non-GAAP Measures
Non-GAAP EBITDA, Adjusted Non-GAAP EBITDA, and other measures presented on an adjusted basis are not recognized terms under U.S. GAAP and do not purport to be alternatives to the most comparable U.S. GAAP amounts. Since all companies do not use identical calculations, our definition and presentation of these measures may not be comparable to similarly titled measures reported by other companies. Management uses the identified non-GAAP measures to evaluate the operating performance of the Company and its business segments and to forecast future periods. Management believes these non-GAAP measures assist investors and other interested parties in evaluating Zomedica's on-going operations and provide important supplemental information to management and investors regarding financial and business trends relating to Zomedica's financial condition and results of operations. Investors should not consider these non-GAAP measures as alternatives to the related GAAP measures. Reconciliations of non-GAAP measures to their closest U.S. GAAP equivalent are presented below.
* Non-GAAP EBITDA is defined as net loss and comprehensive loss excluding amortization, depreciation, non-cash stock compensation, and taxes while reversing out the benefits derived from net interest income.
** Non-GAAP Adjusted EBITDA is defined as Non-GAAP EBITDA, as defined above, excluding expenses related to the transition of TRUFORMA development and manufacturing capabilities, executive transition activities, adjustments associated with our acquisitions, and one-off consulting work.
| For the Year Ended | ||||||||||||||||
| As Presented | One-Time Items | Adjusted | As Presented | |||||||||||||
| 12/31/2023 | 12/31/2023 | 12/31/2023 | 12/31/2022 | |||||||||||||
Net revenue | $ | 25,186 | $ | - | $ | 25,186 | $ | 18,930 | ||||||||
Cost of revenue | 7,868 | - | 7,868 | 5,462 | ||||||||||||
Gross profit | 17,318 | - | 17,318 | 13,468 | ||||||||||||
Expenses | ||||||||||||||||
General and administrative | 29,029 | (3,012 | ) | 26,017 | 22,934 | |||||||||||
Research and development | 5,744 | (2,282 | ) | 3,462 | 2,578 | |||||||||||
Selling and marketing | 14,137 | (121 | ) | 14,016 | 9,879 | |||||||||||
Loss from operations | (31,592 | ) | 5,415 | (26,177 | ) | (21,923 | ) | |||||||||
Interest income | 5,458 | - | 5,458 | 2,701 | ||||||||||||
Interest expense | (175 | ) | - | (175 | ) | (1 | ) | |||||||||
Gain (loss) on disposal of assets | 24 | - | 24 | 1 | ||||||||||||
Other loss | 2,080 | (2,174 | ) | (94 | ) | (7 | ) | |||||||||
Impairment expense | (11,683 | ) | 11,683 | - | - | |||||||||||
Foreign exchange loss | 28 | - | 28 | (152 | ) | |||||||||||
Loss before income taxes | (35,860 | ) | 14,924 | (20,936 | ) | (19,381 | ) | |||||||||
Income tax expense (benefit) | (1,331 | ) | - | (1,331 | ) | (2,366 | ) | |||||||||
Net loss | (34,529 | ) | 14,924 | (19,605 | ) | (17,015 | ) | |||||||||
Unrealized gains, change in fair value of available-for-sale securities, net of tax | 936 | - | 936 | (869 | ) | |||||||||||
Change in foreign currency translation | (45 | ) | - | (45 | ) | 24 | ||||||||||
Net loss and comprehensive loss | $ | (33,638 | ) | $ | 14,924 | $ | (18,714 | ) | $ | (17,860 | ) | |||||
Adjustments (Non-Cash) | ||||||||||||||||
Amortization | $ | 5,468 | $ | - | $ | 5,468 | $ | 3,616 | ||||||||
Depreciation | 830 | - | 830 | 426 | ||||||||||||
Stock Compensation | 6,263 | - | 6,263 | 7,891 | ||||||||||||
Subtotal | $ | (21,077 | ) | $ | 14,924 | $ | (6,153 | ) | $ | (5,927 | ) | |||||
Interest | $ | (5,283 | ) | $ | - | $ | (5,283 | ) | $ | (2,700 | ) | |||||
Taxes | (1,331 | ) | - | (1,331 | ) | (2,366 | ) | |||||||||
Non-GAAP Adjusted EBITDA** | $ | (27,691 | ) | $ | 14,924 | $ | (12,767 | ) | $ | (10,993 | ) | |||||
SOURCE: Zomedica Corp.
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