HOLLISTON, Mass., May 16, 2024 (GLOBE NEWSWIRE) -- Harvard Bioscience, Inc. (Nasdaq: HBIO) today announced that Jim Green, Chairman and Chief Executive Officer, and Jennifer Cote, Chief Financial Officer, will be participating in the Benchmark Healthcare House Call Virtual Conference on May 22nd, 2024, with a live fireside chat scheduled for 9:00-9:40 am ET. The Company will also be hosting one-on-one meetings with investors in conjunction with the Conference. To register for the presentation, or to schedul ...

For the transition period from to Commission file number 001-33957 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q ☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended March 31, 2024 ☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 (State or other jurisdiction of Incorporation or organization) (I.R.S. Employer Identification No.) 84 October Hill Road, Holliston, Massa ...

Harvard Bioscience (HBIO) came out with quarterly earnings of $0.02 per share, in line with the Zacks Consensus Estimate. This compares to earnings of $0.06 per share a year ago. These figures are adjusted for non-recurring items.A quarter ago, it was expected that this medical instruments maker would post earnings of $0.05 per share when it actually produced earnings of $0.04, delivering a surprise of -20%.Over the last four quarters, the company has not been able to surpass consensus EPS estimates.Harvard ...

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) Harvard Bioscience experienced Q1 2024 revenue decline due to market headwinds, maintaining strong gross margins while implementing cost reductions and anticipating second-half growth - CEO Jim Green noted Q1 revenues were impacted by market headwinds, particularly in APAC, despite achieving a **60% gross margin**[2](index=2&type=chunk) - Solid growth is anticipated in the second half of the year, driven by new product commercializations and expected Chinese stimulus for academic research and healthcare[2](index=2&type=chunk) Q1 2024 Financial Results Summary | Financial Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Revenues (Millions USD) | $24.5 | $30.0 | | Gross Margin (%) | 60.3 | 61.2 | | Operating (Loss) Income (GAAP) (Millions USD) | $(2.3) | $1.7 | | Adjusted Operating Income (Millions USD) | $1.2 | $4.4 | | Net (Loss) Income (GAAP) (Millions USD) | $(4.7) | $0.6 | | Diluted (Loss) EPS (GAAP) (USD/share) | $(0.11) | $0.01 | | Diluted Adjusted EPS (USD/share) | $0.02 | $0.06 | | Adjusted EBITDA (Millions USD) | $1.6 | $4.8 | | Adjusted EBITDA Margin (%) | 6.6 | 15.9 | [Detailed Financial Performance](index=2&type=section&id=Detailed%20Financial%20Performance) The company experienced a Q1 2024 revenue decline and net loss, with full-year 2024 revenues expected to be flat, anticipating second-half growth and stable margins [First Quarter 2024 Results](index=2&type=section&id=First%20Quarter%202024%20Results) Q1 2024 results indicate a revenue decrease and net loss, alongside positive cash flow from operations and a reduction in debt Q1 Revenue and Gross Margin Comparison | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Revenues (Millions USD) | $24.5 | $30.0 | | Gross Margin (%) | 60.3 | 61.2 | - The company reported a **net loss of $(4.7) million**, including a **$(2.3) million loss** on marketable securities and other operating expenses, compared to a **net income of $0.6 million** in Q1 2023[4](index=4&type=chunk) Q1 Adjusted EBITDA and Cash Flow | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Adjusted EBITDA (Millions USD) | $1.6 | $4.8 | | Cash provided by operations (Millions USD) | $1.4 | $1.8 | - Debt was reduced by **$1.0 million** during the first quarter of 2024[5](index=5&type=chunk) [2024 Guidance](index=2&type=section&id=2024%20Guidance) Full-year 2024 revenues are projected to be flat, with anticipated second-half growth, a **60% gross margin**, and mid-teens adjusted EBITDA margin - Full-year 2024 revenues are expected to be approximately **flat** compared to 2023[6](index=6&type=chunk) - Growth is anticipated in the second half of 2024, driven by new product commercializations and expected improvements in China[6](index=6&type=chunk) - The company expects a full-year 2024 **gross margin of approximately 60%** and an **adjusted EBITDA margin in the mid-teens**[6](index=6&type=chunk) [Financial Statements](index=4&type=section&id=Financial%20Statements) The consolidated financial statements detail Q1 2024 performance, showing a net loss, total assets of **$133.2 million**, and **$1.4 million** in cash from operations [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) The Q1 2024 Consolidated Statement of Operations reports revenues of **$24.5 million**, an operating loss of **$(2.3) million**, and a net loss of **$(4.7) million** Q1 2024 Consolidated Statement of Operations (in thousands) | Line Item | Q1 2024 (Thousands USD) | Q1 2023 (Thousands USD) | | :--- | :--- | :--- | | Revenues | $24,512 | $29,975 | | Gross Profit | $14,772 | $18,346 | | Total Operating Expenses | $17,051 | $16,597 | | Operating (Loss) Income | $(2,279) | $1,749 | | Net (Loss) Income | $(4,694) | $622 | | Diluted (Loss) EPS | $(0.11) | $0.01 | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2024, the balance sheet shows total assets of **$133.2 million**, with **$4.3 million** in cash and **$31.9 million** in long-term debt Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2024 (Thousands USD) | Dec 31, 2023 (Thousands USD) | | :--- | :--- | :--- | | Cash and cash equivalents | $4,255 | $4,283 | | Total current assets | $48,148 | $49,038 | | Total assets | $133,161 | $137,366 | | Total current liabilities | $25,677 | $26,542 | | Long-term debt, net | $31,890 | $30,704 | | Stockholders' equity | $68,812 | $73,074 | | Total liabilities and stockholders' equity | $133,161 | $137,366 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2024 cash flow statements show **$1.4 million** provided by operating activities, with net cash used in investing and financing activities Q1 Condensed Consolidated Statement of Cash Flows (in thousands) | Cash Flow Activity | Q1 2024 (Thousands USD) | Q1 2023 (Thousands USD) | | :--- | :--- | :--- | | Net cash provided by operating activities | $1,403 | $1,812 | | Net cash (used in) provided by investing activities | $(225) | $288 | | Net cash used in financing activities | $(1,055) | $(2,893) | | Decrease in cash and cash equivalents | $(28) | $(719) | [Non-GAAP Financial Measures](index=2&type=section&id=Non-GAAP%20Financial%20Measures) The company uses non-GAAP measures to clarify core operational performance, reconciling Q1 2024 GAAP operating loss to **$1.2 million** adjusted operating income and net loss to **$0.7 million** non-GAAP net income [Use of Non-GAAP Financial Information](index=2&type=section&id=Use%20of%20Non-GAAP%20Financial%20Information) Non-GAAP financial information is provided to enhance understanding of underlying operations by excluding specific non-representative items - Non-GAAP financial information is included to provide investors with an enhanced understanding of the business's underlying operations[9](index=9&type=chunk) - Excluded items from non-GAAP measures, such as stock-based compensation and amortization of intangibles, are not considered representative of underlying operations[9](index=9&type=chunk) [Reconciliation of GAAP to Non-GAAP Measures](index=7&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Measures) This section reconciles Q1 2024 GAAP operating loss to **$1.2 million** adjusted operating income and net loss to **$0.7 million** non-GAAP net income, detailing adjustments and net debt Q1 2024 GAAP to Non-GAAP Reconciliation Highlights (in thousands) | Metric | GAAP (Thousands USD) | Adjustments (Thousands USD) | Non-GAAP (Adjusted) (Thousands USD) | | :--- | :--- | :--- | :--- | | Operating (Loss) Income | $(2,279) | $3,450 | $1,171 | | Net (Loss) Income | $(4,694) | $5,389 | $695 | | Diluted (Loss) EPS | $(0.11) | - | $0.02 | - Other operating expenses in Q1 2024 totaled **$966 thousand**, including a **$0.5 million** commission fee for employee retention credits and an estimated **$0.5 million** loss from an unclaimed property audit[23](index=23&type=chunk) Net Debt Calculation (in thousands) | Date | Total Debt (Thousands USD) | Cash (Thousands USD) | Net Debt (Thousands USD) | | :--- | :--- | :--- | :--- | | Mar 31, 2024 | $35,610 | $(4,255) | $31,845 | | Dec 31, 2023 | $36,563 | $(4,283) | $32,840 | | Mar 31, 2023 | $44,053 | $(3,789) | $41,034 | [Corporate Information and Forward-Looking Statements](index=2&type=section&id=Corporate%20Information%20and%20Forward-Looking%20Statements) This section outlines Harvard Bioscience's business in life science technologies, details investor communications, and includes a safe harbor statement for forward-looking information - Harvard Bioscience develops and sells life science technologies globally, serving academic, government, pharmaceutical, and biotech sectors[13](index=13&type=chunk) - The report includes forward-looking statements regarding future financial performance, growth, and new product introductions, subject to inherent risks and uncertainties[15](index=15&type=chunk) - A conference call and webcast were hosted on May 7, 2024, at 8:00 a.m. Eastern Time to discuss the financial results[7](index=7&type=chunk)

HOLLISTON, Mass., April 29, 2024 (GLOBE NEWSWIRE) -- Harvard Bioscience, Inc. (Nasdaq: HBIO) will announce its financial results for the quarter ended March 31, 2024 before the market opens on May 7, 2024, and will hold a conference call to discuss the results at 8:00 a.m. Eastern Time. Participants who would like to join the call and ask a question must register here. Once registered, you will receive the dial-in numbers and a unique PIN number. Participants who would like to join the audio-only webcast sh ...

HOLLISTON, Mass., April 29, 2024 (GLOBE NEWSWIRE) -- Harvard Bioscience, Inc. (Nasdaq: HBIO) will announce its financial results for the quarter ended March 31, 2024 before the market opens on May 7, 2024, and will hold a conference call to discuss the results at 8:00 a.m. Eastern Time.  Participants who would like to join the call and ask a question must register here. Once registered, you will receive the dial-in numbers and a unique PIN number.  Participants who would like to join the audio-only webcast ...

HOLLISTON, Mass., April 09, 2024 (GLOBE NEWSWIRE) -- Harvard Bioscience, Inc. (NASDAQ:HBIO) today announced a labor force reduction to improve its operating cost structure and support its ongoing investments in growth. The Company expects to realize overall annual run rate savings of approximately $4 million beginning in the second quarter of 2024. The Company also expects second quarter restructuring-related charges of approximately $0.5 million. Jim Green, Harvard Bioscience Chairman and CEO, said, "We re ...

PART I [Business Overview](index=4&type=section&id=Item%201.Business.) Harvard Bioscience, Inc. develops, manufactures, and sells life science technologies for research, therapy discovery, bioproduction, and preclinical testing - Harvard Bioscience, Inc. is a leading developer, manufacturer, and seller of technologies, products, and services for life science applications, including research, pharmaceutical and therapy discovery, bioproduction, and preclinical testing[13](index=13&type=chunk) - The company's strategy for sustainable revenue growth focuses on four key areas: strengthening competitive position in therapy research and preclinical testing, expanding product offerings to higher-volume industrial customers (CROs, biotech, pharma, government labs), expanding bioproduction offerings, and enhancing in vitro testing products for therapy discovery and development[18](index=18&type=chunk) - Products are organized into two families: Cellular and Molecular Technologies (CMT) and Preclinical. CMT products support molecular, cellular, organ, and organoid research, making up approximately **49% of global revenues in 2023** (**51% in 2022**). Preclinical products support drug development's preclinical testing phase, accounting for approximately **51% of global revenues in 2023** (**49% in 2022**)[20](index=20&type=chunk)[21](index=21&type=chunk)[22](index=22&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk) - Sales channels include direct sales (**65% of 2023 revenues**) and distributors (**35% of 2023 revenues**) across the United States, China, and major European markets[31](index=31&type=chunk) Research and Development Expenses | Year Ended December 31, | R&D Expenses (in millions) | | :---------------------- | :------------------------- | | 2023 | $11.8 | | 2022 | $12.3 | Employee Count by Country (as of December 31, 2023) | Country | Full-time | Part-time | | :-------------- | :-------- | :-------- | | United States | 248 | 9 | | Germany | 55 | 14 | | United Kingdom | 35 | 2 | | Spain | 26 | - | | China | 17 | - | | Rest of World | 10 | - | | **Total** | **391** | **25** | [Risk Factors](index=10&type=section&id=Item%201A.Risk%20Factors.) The company faces significant risks including intense competition, rapid technological change, dependence on volatile pharmaceutical and biotechnology sectors, and potential reductions in government funding - The life sciences industry is highly competitive and subject to rapid technological change, with many competitors possessing greater resources and broader product offerings[54](index=54&type=chunk)[55](index=55&type=chunk) - A significant portion of revenue is derived from pharmaceutical and biotechnology industries, making the company susceptible to their risks, such as government regulation, consolidation, and R&D spending fluctuations[57](index=57&type=chunk)[58](index=58&type=chunk) - Reductions in customer research budgets or government funding (e.g., NIH grants) could adversely affect business, as many customers are dependent on such funding[60](index=60&type=chunk) - International operations expose the company to risks including foreign currency fluctuations, local economic conditions, political instability, and compliance with diverse regulations[61](index=61&type=chunk)[62](index=62&type=chunk)[63](index=63&type=chunk) - Rising inflation and interest rates could negatively impact revenues, profitability, and borrowing costs, as the company may be unable to pass on increased costs[65](index=65&type=chunk) - The company has substantial debt (**$37.1 million outstanding as of December 31, 2023**) and is subject to financial covenants under its Credit Agreement, with potential for adverse impact if compliance is not maintained[66](index=66&type=chunk)[67](index=67&type=chunk)[68](index=68&type=chunk)[69](index=69&type=chunk)[70](index=70&type=chunk) - Cybersecurity incidents pose a risk to critical systems, sensitive data, and reputation, despite ongoing investments in protection and response capabilities[76](index=76&type=chunk) - The company's stock price has historically fluctuated and could experience substantial declines due to market volatility, technological innovations, financial performance, and other industry-specific factors[90](index=90&type=chunk)[93](index=93&type=chunk) [Unresolved Staff Comments](index=20&type=section&id=Item%201B.Unresolved%20Staf%20Comments.) The company reported no unresolved staff comments from the SEC - No unresolved staff comments were reported[102](index=102&type=chunk) [Cybersecurity](index=20&type=section&id=Item%201C.Cybersecurity.) The company implements a cybersecurity risk management program, overseen by the Board, to protect systems and data, with no material impact to date - The company has a cybersecurity risk management program based on NIST and ISO 27001 frameworks, including risk assessments, a security team, external service providers, employee training, and an incident response protocol[103](index=103&type=chunk)[108](index=108&type=chunk) - The Board of Directors oversees cybersecurity risk, receiving periodic reports from management, including the Vice President of IT, who is responsible for assessing and managing cybersecurity threats[105](index=105&type=chunk)[106](index=106&type=chunk) - To date, cybersecurity risks and incidents have not materially affected the company's business strategy, results of operations, or financial condition[104](index=104&type=chunk) [Properties](index=20&type=section&id=Item%202.Properties.) The company operates principal manufacturing facilities and corporate headquarters in Holliston, Massachusetts, New Brighton, Minnesota, Reutlingen, Germany, Barcelona, Spain, and March-Hugstetten, Germany Principal Leased Facilities (as of December 31, 2023) | Location | Description of Facility | Approximate Square Footage | Expiration | | :------------------------ | :--------------------------------------- | :------------------------- | :--------- | | Holliston, Massachusetts | Manufacturing facility and corporate headquarters | 83,000 | 2024 | | New Brighton, Minnesota | Manufacturing facility | 75,000 | 2030 | | Reutlingen, Germany | Manufacturing facility | 23,000 | 2024 | | Barcelona, Spain | Manufacturing facility | 16,000 | 2024 | | March-Hugstetten, Germany | Manufacturing facility | 11,000 | 2024 | - The company also leases facilities in Cambridge, England; Kista, Sweden; Beijing, China; and Shanghai, China, and believes current facilities are adequate for the foreseeable future[107](index=107&type=chunk) [Legal Proceedings](index=22&type=section&id=Item%203.Legal%20Proceedings.) Legal proceedings information is incorporated by reference, with no expected material adverse effect from current claims - Information related to legal proceedings is incorporated by reference from Note 15 and Note 16 to the Consolidated Financial Statements[110](index=110&type=chunk) [Mine Safety Disclosures](index=22&type=section&id=Item%204.Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable[111](index=111&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=22&type=section&id=Item%205.Market%20for%20Registrant's%20Common%20Equity,%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on Nasdaq under 'HBIO', with **43,399,291 shares outstanding** as of March 1, 2024, and no intention to pay cash dividends - The company's common stock is quoted on the Nasdaq Global Market under the symbol 'HBIO'[113](index=113&type=chunk) - As of March 1, 2024, there were **90 holders of record** and **43,399,291 shares of common stock** issued and outstanding[5](index=5&type=chunk)[113](index=113&type=chunk) - The company has never declared or paid cash dividends on its common stock and does not intend to in the foreseeable future[114](index=114&type=chunk) [Item 6. [Reserved]](index=22&type=section&id=Item%206.[Reserved]) This item is reserved and contains no information [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%207.Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) Harvard Bioscience experienced a **1.0% decrease in revenues** to **$112.3 million** in 2023, with gross profit increasing by **8.6%** to **$66.1 million** due to product mix and restructuring, leading to an operating income of **$1.9 million** - The company's business is affected by global and regional economic trends, including inflationary pressure, rising interest rates, exchange rate fluctuations, and softening international markets (especially China and Asia-Pacific)[119](index=119&type=chunk) - Restructuring activities in 2022 and 2023 involved discontinuing non-strategic products and headcount reductions, resulting in inventory charges and severance expenses, aimed at improving operational efficiency and profitability[123](index=123&type=chunk) Selected Operating Metrics (Years Ended December 31) | Metric | 2023 (in thousands) | % of Revenue (2023) | 2022 (in thousands) | % of Revenue (2022) | | :------------------------------ | :------------------ | :------------------ | :------------------ | :------------------ | | Revenues | $112,250 | | $113,335 | | | Gross profit | $66,071 | 58.9% | $60,819 | 53.7% | | Sales and marketing expenses | $24,108 | 21.5% | $25,041 | 22.1% | | General and administrative expenses | $22,780 | 20.3% | $24,493 | 21.6% | | Research and development expenses | $11,764 | 10.5% | $12,329 | 10.9% | | Amortization of intangible assets | $5,525 | 4.9% | $6,122 | 5.4% | | Litigation settlement | $- | - | $(233) | -0.2% | | Interest expense | $3,591 | 3.2% | $2,548 | 2.2% | | Unrealized loss on equity securities | $632 | 0.6% | $- | - | | Income tax expense | $859 | 0.8% | $337 | 0.3% | - Revenues decreased by **$1.0 million (1.0%)** in 2023 to **$112.3 million**, primarily due to a **$5.0 million decrease** from discontinued non-strategic products, partially offset by preclinical product and service growth and a **$0.7 million** favorable foreign exchange impact[126](index=126&type=chunk) - Gross profit increased by **$5.3 million (8.6%)** to **$66.1 million** in 2023, with gross margin improving to **58.9%** from **53.7%** in 2022, driven by a higher mix of preclinical products, services, and software, and reduced costs from restructuring[127](index=127&type=chunk) - Operating income was **$1.9 million** in 2023, a significant improvement from an operating loss of **$6.9 million** in 2022[194](index=194&type=chunk) - Interest expense increased by **$1.1 million (40.9%)** to **$3.6 million** in 2023 due to higher interest rates, partially offset by lower average borrowings[134](index=134&type=chunk) - The company recorded an unrealized loss of **$0.6 million** in 2023 related to its investment in HRGN common stock[135](index=135&type=chunk) Condensed Consolidated Cash Flow Statements (Years Ended December 31) | Cash Flow Activity | 2023 (in thousands) | 2022 (in thousands) | | :------------------------------ | :------------------ | :------------------ | | Cash provided by operating activities | $14,028 | $1,152 | | Cash used in investing activities | $(1,799) | $(1,590) | | Cash used in financing activities | $(12,134) | $(2,837) | | Effect of exchange rate changes on cash | $(320) | $(38) | | Decrease in cash and cash equivalents | $(225) | $(3,313) | - Cash provided by operating activities significantly improved to **$14.0 million** in 2023 from **$1.2 million** in 2022, driven by reduced net loss (adjusted for non-cash items) and increased deferred revenue[142](index=142&type=chunk) - As of December 31, 2023, cash and cash equivalents were **$4.3 million**, and outstanding borrowings under the Credit Agreement were **$37.1 million**. The weighted average interest rate on borrowings was **7.4%** (inclusive of interest rate swaps)[138](index=138&type=chunk)[139](index=139&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures about Market Risk](index=27&type=section&id=Item%207A.Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk.) This item is not applicable to the company - This item is not applicable[152](index=152&type=chunk) [Financial Statements and Supplementary Data](index=27&type=section&id=Item%208.Financial%20Statements%20and%20Supplementary%20Data.) This section presents the audited consolidated financial statements for 2023 and 2022, including balance sheets, statements of operations, comprehensive loss, stockholders' equity, and cash flows, prepared under U.S. GAAP - The consolidated financial statements for the years ended December 31, 2023 and 2022, are presented, including the Report of Independent Registered Public Accounting Firm, Consolidated Balance Sheets, Statements of Operations, Comprehensive Loss, Stockholders' Equity, Cash Flows, and Notes to Consolidated Financial Statements[153](index=153&type=chunk)[181](index=181&type=chunk) - Grant Thornton LLP issued an unqualified opinion on the consolidated financial statements as of and for the year ended December 31, 2023[184](index=184&type=chunk) Consolidated Balance Sheet Highlights (in thousands) | Item | December 31, 2023 | December 31, 2022 | | :---------------------------------- | :---------------- | :---------------- | | Total current assets | $49,038 | $51,124 | | Total assets | $137,366 | $145,360 | | Total current liabilities | $26,542 | $23,249 | | Long-term debt, net | $30,704 | $43,013 | | Total liabilities | $64,292 | $73,140 | | Total stockholders' equity | $73,074 | $72,220 | Consolidated Statements of Operations Highlights (in thousands, except per share data) | Item | Year Ended Dec 31, 2023 | Year Ended Dec 31, 2022 | | :---------------------------------- | :---------------------- | :---------------------- | | Revenues | $112,250 | $113,335 | | Gross profit | $66,071 | $60,819 | | Operating income (loss) | $1,894 | $(6,933) | | Net loss | $(3,415) | $(9,516) | | Basic and diluted loss per share | $(0.08) | $(0.23) | Consolidated Statements of Cash Flows Highlights (in thousands) | Item | Year Ended Dec 31, 2023 | Year Ended Dec 31, 2022 | | :---------------------------------- | :---------------------- | :---------------------- | | Net cash provided by operating activities | $14,028 | $1,152 | | Net cash used in investing activities | $(1,799) | $(1,590) | | Net cash used in financing activities | $(12,134) | $(2,837) | | Decrease in cash and cash equivalents | $(225) | $(3,313) | - Goodwill increased to **$57.1 million** in 2023 from **$56.3 million** in 2022, primarily due to foreign currency translation effects. Intangible assets, net, decreased to **$16.0 million** in 2023 from **$21.0 million** in 2022, mainly due to amortization and write-offs of fully amortized assets[261](index=261&type=chunk) - Long-term debt, net, decreased to **$30.7 million** in 2023 from **$43.0 million** in 2022, reflecting term loan installment payments and net payments under the revolving credit facility[280](index=280&type=chunk) - Total revenues by geographic destination in 2023 were: United States (**$48.2 million**), Europe (**$32.8 million**), Greater China (**$18.5 million**), and Rest of the world (**$12.8 million**)[297](index=297&type=chunk) - The effective tax rate for 2023 was **(33.5%)** compared to **(3.7%)** in 2022, primarily due to changes in the mix of pre-tax income/losses at subsidiaries and the impact of uncertain tax positions[302](index=302&type=chunk) [Notes to Consolidated Financial Statements](index=38&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The Notes detail accounting policies, financial instruments, revenue recognition, tax estimates, restructuring, employee benefits, debt covenants, and an unrealized loss on equity securities - The company operates in one business segment focused on life science applications, with financial performance measured as a single enterprise[254](index=254&type=chunk) - Revenue from instruments, equipment, software, and accessories is recognized at a point in time (typically upon shipment), while service, maintenance, and warranty contracts are recognized over time[228](index=228&type=chunk)[230](index=230&type=chunk)[297](index=297&type=chunk) - The company uses interest rate swap contracts to hedge exposure to changes in interest rates on its variable-rate debt, effectively converting a SOFR-based variable portion into a fixed rate of **4.75%**[286](index=286&type=chunk) - Significant judgment is required for income tax accounting, particularly in determining deferred tax assets and valuation allowances, which are based on estimates of future taxable income[150](index=150&type=chunk)[151](index=151&type=chunk) Restructuring Activity (Years Ended December 31, in thousands) | Item | 2023 | 2022 | | :---------------------------------- | :--- | :--- | | Restructuring and other exit costs | $391 | $2,394 | | Non-cash charges | $(142) | $(1,471) | | Cash payments | $(801) | $(287) | - The company sponsors employee retirement savings plans, contributing **$1.1 million** in both 2023 and 2022. It also maintains two defined benefit pension plans for its UK subsidiary, which were closed to new employees and future accruals in 2014[269](index=269&type=chunk)[270](index=270&type=chunk) Long-Term Debt (as of December 31, in thousands) | Item | 2023 | 2022 | | :---------------------------------- | :------ | :------ | | Term loan | $30,723 | $34,814 | | Revolving line | $6,400 | $12,850 | | Less: unamortized deferred financing costs | $(560) | $(840) | | Total debt | $36,563 | $46,824 | | Less: current portion of long-term debt | $(6,139) | $(4,091) | | Current unamortized deferred financing costs | $280 | $280 | | Long-term debt | $30,704 | $43,013 | - The company was in compliance with the covenants of its Credit Agreement as of December 31, 2023[285](index=285&type=chunk) - Stock-based compensation expense was **$5.0 million** in 2023, up from **$4.4 million** in 2022. As of December 31, 2023, **$4.7 million** in compensation costs related to unvested awards remains unrecognized[290](index=290&type=chunk) - In April 2023, shares of Series E Convertible Preferred Stock held in HRGN were mandatorily converted into HRGN common stock. As of December 31, 2023, the company held HRGN common stock with an estimated fair value of **$3.5 million**, and recorded an unrealized loss of **$0.6 million** in 2023[315](index=315&type=chunk)[316](index=316&type=chunk) - The company completed the disposition of its Hoefer product line in February 2023 for **$0.5 million** cash, resulting in a **$0.4 million** gain[317](index=317&type=chunk) - Government assistance received was **$0.2 million** in 2023 and **$0.7 million** in 2022, primarily for German subsidiaries to offset COVID-19 impacts and support R&D. In February 2024, the company received **$3.1 million** for the Employee Retention Credit[319](index=319&type=chunk)[320](index=320&type=chunk) [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=27&type=section&id=Item%209.Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure.) The company reported no changes in or disagreements with accountants on accounting and financial disclosure - No changes in and disagreements with accountants on accounting and financial disclosure were reported[154](index=154&type=chunk) [Item 9A. Controls and Procedures](index=27&type=section&id=Item%209A.Controls%20and%20Procedures.) Disclosure controls and internal control over financial reporting were effective as of December 31, 2023, with no material changes reported - As of December 31, 2023, the principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective[156](index=156&type=chunk) - Management assessed and concluded that the company's internal control over financial reporting was effective as of December 31, 2023, based on the COSO framework[158](index=158&type=chunk) - Grant Thornton LLP, the independent registered public accounting firm, issued an unqualified opinion on the effectiveness of the company's internal control over financial reporting as of December 31, 2023[162](index=162&type=chunk)[185](index=185&type=chunk) - There were no changes in internal control over financial reporting during the last quarter ended December 31, 2023, that materially affected, or are reasonably likely to materially affect, internal control over financial reporting[159](index=159&type=chunk) [Item 9B. Other Information](index=30&type=section&id=Item%209B.Other%20Information.) CEO James Green's Rule 10b5-1 trading plan, adopted November 23, 2023, for up to 240,000 shares, was terminated January 21, 2024, with no shares sold - James Green, Chairman, President, and CEO, adopted a Rule 10b5-1 trading plan on November 23, 2023, to sell a maximum of **240,000 shares**[169](index=169&type=chunk) - The trading plan was terminated on January 21, 2024, and no shares were sold under the plan prior to its termination[169](index=169&type=chunk) [Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=30&type=section&id=Item%209C.Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections.) This item is not applicable to the company - This item is not applicable[170](index=170&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=30&type=section&id=Item%2010.Directors,%20Executive%20Of%20icers%20and%20Corporate%20Governance.) Information on directors, executive officers, and corporate governance is incorporated by reference from the 2024 Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement for the 2024 Annual Meeting of Stockholders[172](index=172&type=chunk) [Executive Compensation](index=30&type=section&id=Item%2011.Executive%20Compensation.) Executive compensation information is incorporated by reference from the company's definitive Proxy Statement for the 2024 Annual Meeting of Stockholders - Information is incorporated by reference from the definitive Proxy Statement for the 2024 Annual Meeting of Stockholders[173](index=173&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=30&type=section&id=Item%2012.Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters.) Security ownership information for beneficial owners and management is incorporated by reference from the 2024 Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement for the 2024 Annual Meeting of Stockholders[174](index=174&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=30&type=section&id=Item%2013.Certain%20Relationships%20and%20Related%20Transactions,%20and%20Director%20Independence.) Information on related transactions and director independence is incorporated by reference from the 2024 Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement for the 2024 Annual Meeting of Stockholders[175](index=175&type=chunk) [Principal Accounting Fees and Services](index=30&type=section&id=Item%2014.Principal%20Accounting%20Fees%20and%20Services.) Principal accounting fees and services information is incorporated by reference from the 2024 Proxy Statement - Information is incorporated by reference from the definitive Proxy Statement for the 2024 Annual Meeting of Stockholders[176](index=176&type=chunk) PART IV [Exhibits, Financial Statement Schedules](index=30&type=section&id=Item%2015.Exhibits,%20Financial%20Statement%20Schedules.) This section lists consolidated financial statements, schedules, and an exhibit index filed as part of the Annual Report on Form 10-K - This section lists consolidated financial statements, financial statement schedules (omitted if not applicable or included in notes), and an exhibit index[179](index=179&type=chunk) [Form 10-K Summary](index=30&type=section&id=Item%2016.Form%2010-K%20Summary.) This item indicates that no Form 10-K Summary is provided - No Form 10-K Summary is provided[179](index=179&type=chunk) [Exhibit Index](index=62&type=section&id=Exhibit%20Index) The Exhibit Index provides a comprehensive list of all exhibits filed as part of the Annual Report on Form 10-K, detailing their descriptions and methods of filing - The Exhibit Index lists all exhibits filed as part of the Annual Report on Form 10-K, including descriptions and filing methods[325](index=325&type=chunk)

Financial Data and Key Metrics - GAAP operating profit was $300,000, up from a negative $500,000 last year [4] - Adjusted operating profit measured $3.3 million or 11.6% of revenue, about flat with prior year [4] - Revenue for the quarter was $28.2 million, down a modest 1% from last year on an as reported basis [53] - Adjusted EBITDA measured as $3.7 million or 13% of revenue, again about flat to last year [59] - GAAP earnings per share was $0.04 loss, again same as last year [27] - Adjusted EPS measured a positive $0.04 a share, again same as last year [27] - Gross margin improved to $16.3 million or 58% of revenue, up 230 basis points from the same period last year [83] - Cash flow from operations came in at $4.3 million, up from $2.7 million last year [54] Business Line Data and Key Metrics - In the Americas, revenue was up 4.1% as reported and included a 2.1% net reduction from discontinued products [5] - Pre-clinical had strong growth in core telemetry and Ponemah enterprise software [5] - Cellular and molecular products were up in electroporation and bioproduction and up in cell-based testing [5] - EMEA revenue was up 3.1% as reported and included 2.1% net reduction from discontinued products and a positive currency effect of 4.1% [60] - Pre-clinical systems showed modest growth and was helped by the first installation of the new high-capacity VivaMARS Behavioral System at a large CRO operation [60] Market Data and Key Metrics - Q4 reported revenue in China and Asia Pacific was down 15% [28] - Adjusting for currency and discontinued products, Asia Pacific was down about 10% [28] - Telemetry and Ponemah enterprise software held their own in Asia Pacific [28] - Cellular and molecular products saw another tough quarter similar to Q3 in Asia Pacific [28] - The weakness in China is expected to continue into Q1 2024 [28] Company Strategy and Industry Competition - The company's first focus is to strengthen its base business, which is the vast majority of its business [6] - The company introduced its new SoHo Shared Housing Telemetry Family of implantables and latest Ponemah software at the Society for Neuroscience last November [6] - The company is focusing on commercializing its leadership position in advanced cellular applications [7] - The company launched the Mesh MEA Organoid Platform at the Society for Neuroscience and is showcasing it at the Society of Toxicology conference [7] - The company's second focus is expanding to high-volume industrial applications [29] - The company introduced VivaMARS, the high-capacity behavioral system at the Society for Neuroscience in Q4 [29] - The company's third focus is expanding to the bioproduction with its leading electroporation and electrofusion technology [86] - The company established a commercial and application science team dedicated to bioproduction and advances in electroporation in January [86] - The company released its GLP/cGMP compliant amino acid analyzer for bioproduction quality control in February [86] Management Commentary on Operating Environment and Future Outlook - The company expects flat to modest revenue growth for the full year 2024 [11] - The company expects weakness in the first half of 2024 versus a strong and very difficult prior-year comparison [11] - The company expects China revenue to be down significantly in Q1 2024 [11] - The company expects meaningful growth from new product commercializations [33] - The company expects China funding to improve going into the second half of 2024 [33] - The company expects gross margins in the 60% range, up from 59% [33] - The company expects adjusted EBITDA margins improving to the mid-teens, up from 13% [33] - The company expects strong second half growth versus the first half of 2024 and versus the second half of 2023 [66] Other Important Information - The company received a net cash benefit of $2.6 million for the employee retention credit provided by the CARES Act in February 2024 [10] - The company's full year gross margin finished at 58.9% compared to 53.7% last year, an improvement of 520 basis points [88] - Adjusted EBITDA finished in alignment with expectations at 13%, a strong improvement over last year's 9.6% [88] - The company's debt paydown for 2023 was $10.5 million and exceeded expectations of $10 million [89] - Net debt at year-end compared to prior year is down $10.4 million [89] - Net leverage finished the year at 2.3 times compared to 4 times at the end of last year [89] Q&A Session Question: What portion will the SoHo product and other products be of the incremental growth in 2024? [12] - The SoHo product and other products are expected to be a significant part of the incremental growth in 2024 [13] - The company expects the SoHo product to double again going into 2025 [13] - The company expects the behavioral product with VivaMARS to become part of the base business [13] - The company expects the MEA business to grow dramatically, with north of 30% growth [14] Question: What is the landscape for potential partnerships or small M&A activity? [23] - The company is looking at potential partnerships and small M&A activity to bolster current and future offerings [76] - The company is interested in licensing out technologies in areas where it does not have the capacity or funding to go after all of it [76] - The company is exploring acquisitions in areas like consumables and buffers needed by its products [77] Question: What is the long-term growth rate target? [96] - The company targets to be double digits, with a base business growth rate of 5% to 7% and new growth areas adding another 4% to 5% [72] - The company expects the new growth areas with bioproduction and organoids to determine how far above or below 10% it will be [72] Question: What is the ramp for new product launches? [98] - The new product launches are expected to be more back-end loaded, with conversion to shipments and revenue starting to happen in the second half of 2024 [75] - The company expects the new products to drive the trajectory of growth from the second half of 2024 and going forward [71]

2 Enabling discovery, safety and production of tomorrow's therapeutics NASDAQ: HBIO Q4'23 Earnings Presentation Jim Green, Chairman, President & CEO Jennifer Cote, CFO & Treasurer March 7, 2024 This document contains forward-looking statements within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "may," "will," "expect," "plan," "anticipate," "estimate," "intend" and similar ...