Azenta, Inc. (NASDAQ:AZTA) Q2 2023 Earnings Conference Call May 9, 2023 4:30 PM ET Company Participants Sara Silverman - Head, IR & Corporate Communications Stephen Schwartz - CEO, President & Director Lindon Robertson - EVP & CFO Conference Call Participants Paul Knight - KeyBanc Capital Markets Vijay Kumar - Evercore ISI David Saxon - Needham & Company Jacob Johnson - Stephens Inc. Yuan Zhi - B. Riley Securities Operator Greetings, and welcome to the Azenta Q2 2023 Financial Results. [Operator Instruction ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended: March 31, 2023 OR ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from __________ to _________ Commission File Number 000-25434 AZENTA, INC. (Exact name of registrant as specified in its charter) Delaware 04-30 ...

Azenta Life Sciences Barclays Global Healthcare Conference March 15, 2023 Safe Harbor Statement "Safe Harbor" Statement under the U.S. Private Securities Litigation Reform Act of 1995; certain matters in this presentation, including forecasts of future demand and future Company performance, are forward-looking statements that are subject to risks and uncertainties that could cause actual results to materially differ, either better or worse, from those projected. Further discussions of risk factors are avail ...

Financial Data and Key Metrics Changes - Q1 revenue was $178 million, representing a 28% year-over-year increase and a 30% sequential increase. Organic growth, excluding COVID impacts, was 7% year-over-year [16][19][20] - Non-GAAP EPS was $0.12, flat year-over-year, while GAAP EPS reported a loss of $0.15 [17][20] - Adjusted EBITDA margin was approximately 7% [17][21] Business Line Data and Key Metrics Changes - Products segment revenue totaled $90 million, with organic growth of 15% year-over-year, driven by a 23% increase in automated systems [22][23] - Services segment generated $89 million in revenue, with organic growth of 4%, led by a 10% increase in Sample Repository Solutions [24][26] - Cell and gene therapy sales grew nearly 60% year-over-year, contributing approximately 10% to total revenue [9][50] Market Data and Key Metrics Changes - The U.S. market remains a steady grower, Europe is making progress, and China showed double-digit growth in genomics despite COVID challenges [9][10] - B Medical achieved a record revenue of $42 million, although it fell short of initial expectations [10][19] Company Strategy and Development Direction - The company is focusing on accelerating investments in sales talent and innovative product development to drive growth [12][15] - A tuck-in acquisition of Ziath was completed to enhance the portfolio of high-throughput offerings [14] - The company aims to achieve low double-digit growth objectives in the second half of the fiscal year [12][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's position and growth potential despite macroeconomic challenges [11][15] - The company anticipates that cost reduction measures will contribute to margin expansion in the second half of fiscal 2023 [18][30] Other Important Information - The company plans to return approximately $1 billion to shareholders within the calendar year, including a $500 million accelerated share repurchase program [18][27] - The balance sheet remains strong with over $1 billion in cash available for strategic investments [19][27] Q&A Session Summary Question: Guidance on revenue growth and margin expectations - Management reiterated the target of 30% revenue growth for the year but acknowledged margin pressures in the first half, expecting to achieve 10% or better EBITDA margins by Q4 [33][34] Question: Acceleration in cell and gene therapy growth - Management noted a surprising increase in growth attributed to new offerings and strong customer engagement, with a significant portion of growth coming from the genomics business [35][36] Question: Visibility in the storage part of the Sample Repository Solutions business - Management confirmed strong visibility in storage revenue growth, indicating a solid recurring revenue base as samples are stored [39][40] Question: Focus of future M&A activities - Management indicated that while recent M&A has focused on products, there is an active pipeline for genomics-related acquisitions as well [46][47] Question: Revenue contribution from cell and gene therapy - Management confirmed that cell and gene therapy now accounts for approximately 10% of total revenue, excluding B Medical [49][50] Question: Trends in genomic services customer behavior - Management observed no significant differences in spending behavior across customer segments, although academic institutions may show slightly slower spending [69][70]

Conference Call First Quarter Fiscal 2023 Financial Results February 8, 2023 1 Azenta Life Sciences | Proprietary and confidential. Safe Harbor Statement "Safe Harbor" Statement under the U.S. Private Securities Litigation Reform Act of 1995; certain matters in this presentation, including forecasts of future demand and future Company performance, are forward-looking statements that are subject to risks and uncertainties that could cause actual results to materially differ, either better or worse, from thos ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended: December 31, 2022 OR ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from __________ to _________ Commission File Number 000-25434 AZENTA, INC. (Exact name of registrant as specified in its charter) Delaware 04 ...

Azenta, Inc. (NASDAQ:AZTA) Q4 2022 Earnings Conference Call November 14, 2022 4:30 PM ET Company Participants Sara Silverman - Head, IR Stephen Schwartz - CEO, President & Director Lindon Robertson - EVP & CFO Conference Call Participants Vijay Kumar - Evercore ISI David Saxon - Needham & Company Jacob Johnson - Stephens Inc. Yuan Zhi - B. Riley Securities Operator Greetings, and welcome to the Azenta Q4 2022 Financial Results. [Operator Instructions]. As a reminder, this conference is being recorded Monday ...

PART I. FINANCIAL INFORMATION [Item 1. Consolidated Financial Statements](index=4&type=section&id=Item%201%2E%20Consolidated%20Financial%20Statements) The consolidated financial statements present Azenta's financial position and performance, restated to reflect the semiconductor automation business as a discontinued operation, showing increased cash and a substantial net income for the nine-month period driven by divestiture gains Financial Statement Summary | Financial Statement | Period | Key Figure (in thousands) | | :--- | :--- | :--- | | **Balance Sheet** | As of June 30, 2022 | Total Assets: $3,722,717 | | | | Total Liabilities: $294,931 | | | | Total Stockholders' Equity: $3,427,786 | | **Statement of Operations** | Three months ended June 30, 2022 | Total Revenue: $132,735 | | | | Loss from continuing operations: $(7,015) | | | | Net (Loss) Income: $(9,570) | | **Statement of Operations** | Nine months ended June 30, 2022 | Total Revenue: $417,931 | | | | Loss from continuing operations: $(5,973) | | | | Net Income: $2,153,624 | | **Statement of Cash Flows** | Nine months ended June 30, 2022 | Net cash (used in) operating activities: $(475,680) | | | | Net cash provided by investing activities: $1,840,068 | | | | Net cash used in financing activities: $(64,513) | [Note 1. Nature of Operation](index=11&type=section&id=1%2E%20Nature%20of%20Operation) Azenta operates as a global provider of life science sample exploration and management solutions, having divested its semiconductor automation business for $2.9 billion - The company is a global provider of life science sample exploration and management solutions, supporting customers from research to clinical development[22](index=22&type=chunk) - On February 1, 2022, the company completed the sale of its semiconductor automation business for **$2.9 billion** in cash, with expected net proceeds of **$2.5 billion** after taxes and costs, now classified as a discontinued operation[23](index=23&type=chunk)[24](index=24&type=chunk) - The COVID-19 pandemic has not had a substantial negative impact on financial results, partly mitigated by realignment of resources to support virus research and vaccine development[26](index=26&type=chunk) [Note 3. Discontinued Operations](index=20&type=section&id=3%2E%20Discontinued%20Operations) The company completed the sale of its semiconductor automation business for $2.9 billion, resulting in a pre-tax gain of $2.6 billion included in net income from discontinued operations - The sale of the semiconductor automation business was completed on February 1, 2022, for **$2.9 billion** in cash, with expected net proceeds of **$2.5 billion** after taxes[56](index=56&type=chunk) Discontinued Operations (Semiconductor) | Discontinued Operations (Semiconductor) | Nine Months Ended June 30, 2022 (in thousands) | Nine Months Ended June 30, 2021 (in thousands) | | :--- | :--- | :--- | | Total Revenue | $264,430 | $474,674 | | (Loss) gain on divestiture | $2,560,384 | $0 | | Net income from discontinued operations | $2,159,597 | $95,414 | [Note 5. Acquisitions](index=25&type=section&id=5%2E%20Acquisitions) The company completed two acquisitions in fiscal 2021, Abeyatech LLC for $9.9 million and Trans-Hit Biomarkers Inc. for $15.1 million, to enhance its life sciences offerings - Acquired Abeyatech LLC on April 2, 2021, for **$9.9 million** cash and **$9.4 million** in contingent consideration to enhance the Life Sciences Products segment[76](index=76&type=chunk) - Acquired Trans-Hit Biomarkers Inc. on December 3, 2020, for approximately **$15.1 million** cash to expand the Life Sciences Services segment[78](index=78&type=chunk) [Note 7. Debt and Line of Credit](index=29&type=section&id=7%2E%20Debt%20and%20Line%20of%20Credit) Following the sale of its semiconductor automation business, Azenta used $49.7 million to extinguish its term loan and terminated its revolving line of credit, resulting in a $0.6 million loss on debt extinguishment - On February 1, 2022, the company used **$49.7 million** of proceeds from the semiconductor business sale to extinguish its outstanding term loan[89](index=89&type=chunk) - The company terminated its revolving line of credit, which had no borrowings outstanding, and recorded a loss on debt extinguishment of **$0.6 million**[89](index=89&type=chunk) [Note 12. Earnings per Share](index=41&type=section&id=12%2E%20Earnings%20per%20Share) For the nine months ended June 30, 2022, the company reported a diluted net income per share of $28.76, primarily driven by a significant gain from the sale of the semiconductor business Earnings Per Share (Diluted) | Earnings Per Share (Diluted) | Nine Months Ended June 30, 2022 | Nine Months Ended June 30, 2021 | | :--- | :--- | :--- | | Loss from continuing operations | $(0.08) | $(0.09) | | Income from discontinued operations | $28.84 | $1.29 | | **Diluted net income per share** | **$28.76** | **$1.20** | [Note 13. Revenue from Contracts with Customers](index=41&type=section&id=13%2E%20Revenue%20from%20Contracts%20with%20Customers) The company disaggregates its revenue into Life Sciences Products, Sample Repository Solutions, and Genomic Services, with total revenue of $417.9 million for the nine months ended June 30, 2022, and $63.7 million in remaining performance obligations Revenue by Business Line | Revenue by Business Line (in thousands) | Nine Months Ended June 30, 2022 | Nine Months Ended June 30, 2021 | | :--- | :--- | :--- | | Life Sciences Products | $150,861 | $146,490 | | Sample Repository Solutions | $78,806 | $64,496 | | Genomic Services | $188,264 | $165,778 | | **Total** | **$417,931** | **$376,764** | - As of June 30, 2022, remaining performance obligations totaled **$63.7 million**, with **$35.7 million** expected to be recognized as revenue within one year[135](index=135&type=chunk)[137](index=137&type=chunk) [Note 14. Segment and Geographic Information](index=45&type=section&id=14%2E%20Segment%20and%20Geographic%20Information) Azenta operates in Life Sciences Products and Services segments, with the Services segment generating $267.1 million and the Products segment $150.9 million in revenue for the nine months ended June 30, 2022, primarily from North America Segment Revenue | Segment Revenue (in thousands) | Nine Months Ended June 30, 2022 | Nine Months Ended June 30, 2021 | | :--- | :--- | :--- | | Life Sciences Products | $150,861 | $146,520 | | Life Sciences Services | $267,070 | $230,244 | | **Total Revenue** | **$417,931** | **$376,764** | Revenue by Geography | Revenue by Geography (in thousands) | Nine Months Ended June 30, 2022 | Nine Months Ended June 30, 2021 | | :--- | :--- | :--- | | North America | $285,283 | $236,939 | | Europe | $75,863 | $82,412 | | China | $33,936 | $33,869 | | Asia Pacific/ Other | $22,849 | $23,544 | | **Total** | **$417,931** | **$376,764** | [Note 18. Subsequent Event](index=52&type=section&id=18%2E%20Subsequent%20Event) After the quarter ended, Azenta continued its acquisition strategy by acquiring Barkey Holding GmbH for approximately €80.0 million and agreeing to acquire B Medical Systems S.a.r.l for approximately €410 million plus contingent payments - On July 1, 2022, the company acquired Barkey Holding GmbH, a provider of controlled rate thawing devices, for approximately **€80.0 million**[170](index=170&type=chunk) - On August 8, 2022, the company agreed to acquire B Medical Systems, a leader in temperature-controlled storage and transportation, for approximately **€410 million**, plus up to **€50 million** in contingent payments[171](index=171&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=53&type=section&id=Item%202%2E%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's discussion centers on the company's transformation into a pure-play life sciences entity following the $2.9 billion sale of its semiconductor automation business, significantly boosting liquidity and funding strategic acquisitions [Overview](index=57&type=section&id=Overview) Azenta is now a leading global provider of life science sample exploration and management solutions, with a strategy combining internal development and strategic acquisitions to build a comprehensive portfolio - The company is a leading global provider of life science sample exploration and management solutions, supporting customers from research to clinical development[183](index=183&type=chunk) - Azenta's strategy combines internal R&D with acquisitions to accelerate time-to-market for its comprehensive sample-based service offerings[185](index=185&type=chunk) [Results of Operations](index=60&type=section&id=Results%20of%20Operations) For Q3 fiscal 2022, revenue increased 3% to $132.7 million, but gross margin declined to 44.9%, leading to an operating loss of $5.1 million, while nine-month revenue grew 11% to $417.9 million with a $10.1 million operating loss Revenue by Segment | Revenue by Segment (in thousands) | Q3 2022 | Q3 2021 | % Change | | :--- | :--- | :--- | :--- | | Life Sciences Products | $47,369 | $48,625 | (3)% | | Life Sciences Services | $85,366 | $80,462 | 6% | | **Total Revenue** | **$132,735** | **$129,087** | **3%** | Key Metrics | Key Metrics | Q3 2022 | Q3 2021 | | :--- | :--- | :--- | | Gross Margin | 44.9% | 48.4% | | Operating Loss (in thousands) | $(5,073) | $(883) | - For the nine months ended June 30, 2022, revenue increased **11%** to **$417.9 million**, while operating loss was **$10.1 million** compared to **$9.8 million** in the prior year period[191](index=191&type=chunk) [Liquidity and Capital Resources](index=73&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity significantly strengthened to $2.5 billion in cash and marketable securities at June 30, 2022, primarily due to $2.9 billion in divestiture proceeds used to extinguish all outstanding debt and fund operations Liquidity | Liquidity (in thousands) | June 30, 2022 | September 30, 2021 | | :--- | :--- | :--- | | Cash and cash equivalents | $1,474,189 | $227,427 | | Marketable securities | $1,021,090 | $3,679 | | **Total Cash & Marketable Securities** | **$2,495,279** | **$231,106** | - On February 1, 2022, the company used **$49.7 million** of proceeds from its divestiture to extinguish all outstanding debt and terminated its revolving line of credit[239](index=239&type=chunk) - Cash outflows from operating activities for the nine months ended June 30, 2022 were **$475.7 million**, which included **$431.6 million** in cash taxes paid related to the semiconductor business sale[241](index=241&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=78&type=section&id=Item%203%2E%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to interest rate and foreign currency fluctuations, with a hypothetical 100 basis point interest rate change impacting interest income by approximately $8 million on its $1 billion investment portfolio, and uses forward contracts to mitigate foreign currency risk on 37% of sales - A hypothetical **100 basis point** change in interest rates would result in an approximate **$8 million** change in interest income on the company's **$1 billion** investment portfolio[253](index=253&type=chunk) - Sales in currencies other than the U.S. dollar were approximately **37%** of total sales for the nine months ended June 30, 2022, and the company utilizes forward contracts to mitigate currency risk[255](index=255&type=chunk)[256](index=256&type=chunk) [Item 4. Controls and Procedures](index=79&type=section&id=Item%204%2E%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures are effective, with no material changes in internal control over financial reporting during the most recent fiscal quarter - Management, including the CEO and CFO, has concluded that the company's disclosure controls and procedures are effective as of June 30, 2022[257](index=257&type=chunk) - No material changes occurred in internal control over financial reporting during the third fiscal quarter[257](index=257&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=80&type=section&id=Item%201%2E%20Legal%20Proceedings) The company is subject to various legal proceedings in the ordinary course of business, none of which management believes will have a material adverse effect on its financial condition or results of operations - The company is subject to ordinary course legal proceedings but does not believe any will have a material adverse effect on its financial condition or results of operations[262](index=262&type=chunk) [Item 1A. Risk Factors](index=80&type=section&id=Item%201A%2E%20Risk%20Factors) There have been no material changes from the risk factors previously disclosed in the company's 2021 Annual Report on Form 10-K and subsequent quarterly reports - There have been no material changes from the risk factors disclosed in the 2021 Annual Report on Form 10-K and subsequent quarterly filings[263](index=263&type=chunk) [Item 6. Exhibits](index=80&type=section&id=Item%206%2E%20Exhibits) This section lists the exhibits filed with the quarterly report, including the certifications by the CEO and CFO as required by the Sarbanes-Oxley Act of 2002 and the Interactive Data File (iXBRL) - The report includes certifications from the CEO and CFO pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[264](index=264&type=chunk)