Bio-Techne Corp Q1 2025 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Puneet Souda - Leerink Partners LLC - Analyst : Hi, guys. Thanks for taking the question and congrats on the quarter here. On the first one is, it's great to see the beat in diagnostics and spatial, but could you elaborate how sustainable as that momentum and speak to both the spatial versus the diagnostics side of the business. And what you're seeing on the biotech and biopharma improvement, I have to say, it is rare in the current market backdrop to see that. So just can you elaborate a bit on your confidence to continue to see that growth? And why is this not something unique to this quarter? And what gives you confidence that, that should continue into the December ending quarter and into the first half of 2025?

Question: Puneet Souda - Leerink Partners LLC - Analyst : Got it. That's super helpful, Jim. So I'm just following up on the cell and gene therapy comments you made. Can you elaborate a bit on are these new trial starts or existing trials that are scale up or moving into later phases? And I think you had provided some account metrics before. Just wondering where the overall account metrics are for the GMP proteins and cell and gene therapy business. Thank you.

Question: Jacob Johnson - Stephens Inc. - Analyst : Good morning. Congrats on the quarter. Maybe sticking with the cell and gene therapy theme, I think kind of below the line, you had positive other income during the quarter. I believe that's where we'll see more flows through. Can you just talk about how this trend in the quarter? And any benefit on the other income line from them? And maybe how to think about that the next few quarters?

Question: Jacob Johnson - Stephens Inc. - Analyst : Got it. Thanks for that, Jim. And Jim, maybe secondly, just on the cost side of things, I guess, specifically around OpEx, some moving pieces on the SG&A line. I think you guys are talking about efficiency. I think there's no restructuring charge in there and then obviously the return of incentive comp. Can you just -- you reiterated your commentary around the margin outlook for this year. But as you think about SG&A and kind of the pacing the rest of the year, can you just help us think through kind of any one-time items in 1Q? And then any benefits from cost savings as we get into the rest of the year? James Hippel - Bio-Techne Corp - Chief Financial Officer, Executive Vice President - Finance Sure. I mean, if you think about the margin profile, specifically for the upcoming quarter here to Q2. A couple of things to keep in mind is that our incentive comp headwinds are actually stronger in Q2 than they were in Q1, meaning we had even more clarity as to where our performance is going to be in Q2 than we did Q1 last year. So we reversed accruals even further. So there's a larger

Question: Dan Leonard - UBS Securities LLC - Analyst : Thank you. First one on COMET, I'd love to better understand the unit model there. Could you remind me what is the ASP for the instrument and what would you expect pull through per year to look like and consumables? And then also by how much did you increase COMET manufacturing capacity?

Question: Dan Leonard - UBS Securities LLC - Analyst : Okay. And just to circle back on your comments on China, can you remind me how much of your revenue mix in China is instruments versus consumables? And anymore color you can offer on the magnitude of the tender activity that you were discussing?

Question: Justin Bowers - Deutsche Bank Securities Inc - Analyst : Hey, good morning, everyone. And just sticking with the previous line of questions. Jim, with sort of the similar organic growth outlook in 2Q. Is there any divergence within the segments i.e., are you still looking for sort of like low single digit and protein sciences and then call it mid-teens and DSB? And then within biopharma, it sounds like you're saying that large pharma has been fairly stable in terms of spend over the last couple of quarters. Are we hearing that correctly? And then the follow-up to that would be within the different businesses within the proteins franchise, i.e., proteinsimple, the run-rate business and Eliza are the trends fairly stable there? Or is there some movement there?

Question: Justin Bowers - Deutsche Bank Securities Inc - Analyst : Large pharma. Is that (multiple speakers) REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies.

Question: Justin Bowers - Deutsche Bank Securities Inc - Analyst : Understood. Just one quick follow up. What was the comp for biopharma and fiscal one '24?

Question: Justin Bowers - Deutsche Bank Securities Inc - Analyst : Sure. Thank you.

Question: Tom Peterson - Baird - Analyst : Everyone. This is Tom Peterson on for Catharine. Thanks for taking our question. Congrats on the solid third quarter. Wanted to maybe or turn to the pacobiology portfolio. Hear you on the updated manufacturing capacity or comments. I guess what was ACD growth in the quarter, specifically? And with respect to your comments around the pull through on that ultimately being potentially that the highest brand any instrument in the portfolio, I guess, what's your level of visibility into how close do you think you're going to get that level in fiscal 2025?

Question: Tom Peterson - Baird - Analyst : Got it. That's super helpful. And maybe just a quick follow-up on China stimulus. I guess, hear some of the comments around the funnel activity. Any changes in underlying activity levels here in the quarter? And then we've heard from some other peers in a state that this stimulus program isn't covering the entirety of the instrument purchases. So I guess at a high level, how big of an impact do you think that this dynamic is? And do we need to see broader China and macro improvement alongside the stimulus distribution to kind of drive a return to typical market growth in China in 2025?

Question: Matt Larew - William Blair - Analyst : Good morning. I wanted to ask on sort of the, I guess, cell and gene therapy, remember just broadly within biotech and biopharma. The extent you have visibility to this, is sort of the pickup in work that you maybe [SaaS] was pause or on hold or delayed and now is returning? Or is this related to new project work that's been coming in? And may be the second part of that would be, if there's any breakdown in your view from the sort of a discovery versus clinical stage and some look coming back? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies.

Question: Matt Larew - William Blair - Analyst : Okay. And you made another announcement about G-rex grant. Obviously, you've been working on the scale-ready partnership, in advance of owning Wilson Wolf, that space obviously remains competitive with new entrants [Lominand] and you are clearly investing in the future there. So just be curious for your take on where you stand from that product and strategy development as well as the competitive standing on the portfolio you're offering.

Question: Sung Ji Nam - Scotia Capital, Inc. - Analyst : Hi, thanks for taking the questions. Just on the academic end market side of things, great to see growth there despite the challenging comparisons. You pointed out Europe, but could you maybe elaborate further in terms of which of the product or business segments where you might have seen the strongest growth in the quarter? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies.

Question: Sung Ji Nam - Scotia Capital, Inc. - Analyst : That's a great. And then just on the molecular diagnostic side, also great to see strong growth there. I was wondering if there might be any update in terms of on any of the partnership opportunity, especially with the Exosome Diagnostics technology?

Question: Sung Ji Nam - Scotia Capital, Inc. - Analyst : Great. Thank you so much.