Bio-Techne (TECH) 7 Aug 24 2024 Q4 Earnings call transcript

Bio-Techne Corporation, a global life sciences company, recently held its fourth quarter earnings call for the fiscal year 2024, highlighting a year of resilience and strategic growth despite the challenging market conditions. The call, led by CEO Kim Kelderman and CFO Jim Hippel, presented an insightful snapshot of the company's performance, strategy, and outlook for the future.

Financial Performance and Market Overview

Bio-Techne reported a 1% year-over-year organic revenue growth in the fourth quarter, with a 1% growth in the fiscal year 2024. The company's core portfolio of research and diagnostic tools, including a catalog of over 6,000 protein and 400,000 antibody types, played a critical role in driving this growth, especially in the context of a challenging funding environment for biotech and a significant R&D budget recalibration by large pharma and academia customers.

The company's strategic focus on its core portfolio and four growth verticals, leveraging this content, delivered a 1% growth in the fiscal year 2024. These growth verticals, which include cell and gene therapy, spatial biology, and molecular diagnostics, are expected to drive accelerated growth in the years ahead, as they account for over 45% of Bio-Techne's revenue in fiscal 2024.

Market Dynamics and Trends

The call highlighted a stabilization trend in key end markets, particularly in the biopharma sector, which saw low single-digit growth in the fourth quarter. Despite a challenging funding environment, Bio-Techne's strategic positioning and execution enabled the company to outperform its peer group during this period. The company's ability to navigate these challenges and maintain momentum in its growth verticals is a testament to its strong business model and strategic focus.

Product and Business Highlights

Bio-Techne's portfolio of productivity tools, including Simple Plex and Simple Western sub-launch, saw mid-single-digit growth for the fiscal year 2024, driven by double-digit growth for instrument-related consumables across all platforms. The company's cell and gene therapy business, led by its quality GMP protein products, also grew mid-single digits for the year, adding more customers even amidst biotech funding constraints.

In the spatial biology vertical, Bio-Techne saw solid growth, despite budget resets by pharma customers. The company's new special biology in [indiscernible] is seeing robust adoption and will bring accelerated growth to this vertical in the years ahead. The ongoing traction and market adoption of its ExoDx prostate set, together with new product launches within its surging franchise, drove double-digit growth in its Molecular Diagnostics growth vertical all year long.

Looking Ahead

Bio-Techne's outlook for the future is optimistic, with a focus on building on its current momentum and leveraging its core portfolio and growth verticals to drive accelerated growth. The company's strategic investments in its four growth verticals, coupled with its differentiated product offerings and market positioning, position it well for long-term success.

The company's strategic acquisitions, such as Lunaphore and Sphere Bio, are expected to contribute to its growth trajectory, particularly in the areas of immunoassay technology and ultra-sensitive protein measurement. Bio-Techne's commitment to innovation and customer-centricity, as reflected in its recent product launches and investments, underscores its long-term growth strategy.

Conclusion

Bio-Techne's fourth quarter earnings call painted a picture of a company that has navigated challenging market conditions with resilience and strategic acumen. The company's focus on its core portfolio and strategic growth verticals, coupled with its ability to innovate and execute, position it well for long-term success in the life sciences sector. As Bio-Techne looks to the future, its commitment to driving value for its customers and stakeholders remains a key driver of its growth and success.