Core Insights - Lifecore Biomedical has appointed Thomas Salus as chief legal and administration officer and corporate secretary, bringing over 30 years of legal and management expertise, particularly in the life sciences industry [1][2][3] - Mr. Salus will oversee all legal activities and human resources, contributing to strategy development and corporate development focused on strategic alliances and partnerships [1][3] - The appointment is part of Lifecore's strategy to enhance corporate governance and SEC/Nasdaq reporting and compliance, aiming to streamline processes that impact performance [3] Company Overview - Lifecore Biomedical, Inc. is a fully integrated contract development and manufacturing organization (CDMO) specializing in the development, fill, and finish of sterile injectable pharmaceutical products [4] - The company has over 40 years of expertise in manufacturing premium, injectable-grade hyaluronic acid and partners with global and emerging biopharmaceutical and biotechnology companies across multiple therapeutic categories [4]

Core Insights - Lifecore Biomedical reported a quarterly loss of $0.19 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.14, and compared to a loss of $0.05 per share a year ago, indicating a significant decline in performance [1] - The company posted revenues of $35.15 million for the quarter ended February 2025, missing the Zacks Consensus Estimate by 3.95% and showing a slight decrease from year-ago revenues of $35.7 million [2] - Lifecore Biomedical shares have declined approximately 3.1% since the beginning of the year, which is slightly better than the S&P 500's decline of 3.6% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.07 on revenues of $35.99 million, and for the current fiscal year, it is -$0.91 on revenues of $129.86 million [7] - The estimate revisions trend for Lifecore Biomedical is mixed, resulting in a Zacks Rank 3 (Hold), suggesting that the shares are expected to perform in line with the market in the near future [6] Industry Context - The Medical - Biomedical and Genetics industry, to which Lifecore Biomedical belongs, is currently ranked in the top 31% of over 250 Zacks industries, indicating a favorable outlook compared to lower-ranked industries [8]

Lifecore Biomedical, Inc. (LFCR) Q3 2025 Earnings Conference Call April 03, 2025 04:30 PM ET Company Participants Stephanie Diaz - Manager, Investor RelationsPaul Josephs - President & Chief Executive OfficerRyan Lake - Chief Financial OfficerUnknown - Conference Call ModeratorUnknown - Conference Call Operator Conference Call Participants Matthew Hewitt - Analyst, Craig Callum Capital GroupMichael Petusky - Analyst, Barrington Research Unknown we'll be in a listen-only mode. Unknown Now, I would like to tu ...

Financial Data and Key Metrics Changes - Revenues for Q3 2025 were $35.2 million, a decrease of 2% compared to $35.7 million for the same period last year [9] - Gross profit for Q3 2025 was $9.8 million, down from $11.9 million in the prior year, primarily due to a decrease in CDMO gross profit [10] - The company recorded a net loss of $14.8 million or $0.47 per diluted share, compared to net income of $15.6 million or $0.42 per diluted share for the same period last year [12] - Adjusted EBITDA for Q3 2025 was $5.7 million, a decrease of $0.7 million compared to $6.4 million in the prior year [12] - For the first nine months of fiscal 2025, revenues were $92.4 million, an increase of 2% compared to $90.4 million for the same period last year [13] Business Line Data and Key Metrics Changes - CDMO revenues decreased by $1.5 million due to the completion of discrete development revenue project life cycles [10] - Hyaluronic acid (HA) manufacturing revenues increased by $1 million due to increased demand from a customer [10] - For the nine months ended February 23, 2025, gross profit improved to $26.3 million from $24.6 million, driven by increased volumes in HA manufacturing [14] Market Data and Key Metrics Changes - The company signed multiple new agreements with both new and existing customers during the quarter, indicating strong market engagement [6] - LifeCorps added six new customers in the first nine months of fiscal 2025, including a significant agreement with Nersim Laboratories [25][26] Company Strategy and Development Direction - The company aims to drive a 12% revenue growth and increase EBITDA margins to over 25% in the coming years [19] - Key growth strategies include maximizing existing customer business, advancing late-stage development programs towards commercialization, and winning new impactful business [20] - The company is focused on reducing operational expenses and enhancing productivity through various initiatives [29][30] Management's Comments on Operating Environment and Future Outlook - Management noted that discussions around domestic drug manufacturing have increased among prospective customers, indicating a potential shift in the industry [44] - The company expects to be cash flow positive from operations in the second half of the fiscal year, with a focus on improving free cash flow [63] - Management reiterated financial guidance for the fiscal year, expecting revenue to be approximately $126.5 million to $130 million [17] Other Important Information - The company has made significant improvements in operational efficiencies and productivity without compromising quality [32][38] - LifeCorps is implementing live production monitoring to enhance operational performance [35] Q&A Session Summary Question: Insights on the desire to bring back drug manufacturing in the US - Management noted increased discussions about domestic manufacturing among large pharmaceutical companies, driven by administrative uncertainty [44] Question: Details on the Humanetics contract signed post-quarter - The contract involves a tech transfer for a promising project, indicating a phase two development stage [46] Question: Progress on identified opportunities with multinational companies - Management reported positive progress and increased engagement with large multinationals, indicating a successful strategy [54] Question: Cash flow from operations and capital expenditures in the quarter - Positive cash flow from operations was approximately $2 million, with capital expenditures around $2 million as well [56][58] Question: Expectations for cash flow generation in the remainder of the fiscal year - Management expects to be cash flow positive in the second half of the year, with potential improvements in free cash flow [63] Question: Outlook on SG&A expenses - SG&A expenses are expected to decrease further in the second half of the year, with ongoing improvements in operational efficiency [66]

Financial Performance - Total revenues for the three months ended February 23, 2025, were $35,154,000, a slight decrease of 1.5% compared to $35,704,000 for the same period in 2024[11] - Gross profit for the nine months ended February 23, 2025, was $26,316,000, representing an increase of 7.1% from $24,578,000 in the prior year[11] - Operating loss for the three months ended February 23, 2025, was $(9,029,000), compared to a loss of $(895,000) for the same period in 2024[11] - Net loss for the nine months ended February 23, 2025, was $(37,570,000), compared to a net income of $19,096,000 for the same period in 2024[12] - The company reported a basic loss per share of $(0.47) for the three months ended February 23, 2025, compared to earnings of $0.48 per share for the same period in 2024[12] - For the nine months ended February 23, 2025, Lifecore Biomedical reported a net loss of $37,570,000 compared to a net income of $19,096,000 for the same period in 2024[16] Cash and Liquidity - Cash and cash equivalents decreased to $5,417,000 as of February 23, 2025, down from $8,462,000 as of May 26, 2024[9] - The company reported cash and cash equivalents of $5,417,000 at the end of the period, down from $19,091,000 at the beginning of the period[16] - Cash flows from operating activities resulted in a net cash used of $5,553,000 for the nine months ended February 23, 2025, an improvement from $8,459,000 in the prior year[16] - The company believes its cash from operations and available credit will be sufficient to finance operational and capital requirements for at least the next twelve months[173] Assets and Liabilities - Total assets decreased to $237,693,000 as of February 23, 2025, from $253,960,000 as of May 26, 2024[9] - Total liabilities decreased to $190,267,000 as of February 23, 2025, compared to $200,058,000 as of May 26, 2024[9] - The company’s accumulated deficit increased to $(204,093,000) as of February 23, 2025, from $(166,523,000) as of May 26, 2024[9] - The balance of redeemable convertible preferred stock increased to $45,197,000 as of February 23, 2025, from $44,312,000 at the end of the previous reporting period[16] Expenses - Research and development expenses for the three months ended February 23, 2025, were $2,045,000, a decrease of 5.8% from $2,170,000 in the same period last year[11] - Stock-based compensation increased to $8,343,000 in the nine months ended February 23, 2025, compared to $4,603,000 in the same period of 2024[16] - Total operating expenses for the nine months increased by 37% to $48,888 million, driven by a significant rise in selling, general, and administrative expenses[157] - Operating expenses increased by 48% to $18.874 million for the three months ended February 23, 2025, compared to $12.789 million for the same period in 2024[141] Debt and Financing - As of February 23, 2025, total debt net of discounts was $124,939 million, slightly up from $124,668 million on May 26, 2024[64] - The Company’s term loan principal is $184,361 million, with a significant portion due in 2029 amounting to $170,325 million[64] - The Term Loan Credit Facility has an effective annual interest rate of 20.9% as of February 23, 2025[69] - The Company incurred total expenses of $18,490 million under the restructuring plan, with expected remaining costs of $1,971 million, leading to total expected costs of $16,519 million[48] Revenue Concentration - The Company had significant revenue concentrations during the three months ended February 23, 2025, with two customers accounting for 54% and 18% of total revenues, compared to 52% and 14% in the same period of 2024[89] - Alcon accounted for 43% of the Company's revenues for the nine months ended February 23, 2025, highlighting its significance as a major customer[117] Stock and Equity - Lifecore Biomedical issued common stock, net of fees, amounting to $23,858,000 during the nine months ended February 23, 2025[16] - The Company issued 5,928,775 shares of common stock on October 3, 2024, for gross proceeds of approximately $24,300, with an issuance cost of $467[78] - As of February 23, 2025, the aggregate liquidation preference of the Redeemable Convertible Preferred Stock was $45,455, with $561 of dividends in arrears[80] Operational Highlights - Lifecore's vertically integrated capabilities allow for rapid movement from product development to commercial production, enhancing supply chain efficiency[132] - The FDA completed a GMP inspection of Lifecore in May 2025, with an initial response to observations provided within the expected timeframe[128] - The company has made strategic capital investments to extend its formulation and filling capacity to meet increasing partner demand[131] Compliance and Governance - Certifications of the Principal Executive Officer and Principal Financial Officer were filed pursuant to the Sarbanes-Oxley Act of 2002, ensuring compliance with regulatory requirements[192] - Management is committed to remediating material weaknesses in internal control over financial reporting, including engaging a third-party consultant and enhancing the internal audit function[180]

Financial Performance - Revenues for Q3 Fiscal 2025 were $35.2 million, a decrease of 2% compared to $35.7 million in the same period last year[9]. - The company recorded a net loss of $14.8 million, or $0.47 loss per diluted share, compared to a net income of $15.6 million, or $0.42 income per diluted share, in the prior year[13]. - Adjusted EBITDA for Q3 Fiscal 2025 was $5.7 million, a decrease of $0.7 million from $6.4 million in the prior year[13]. - Gross profit for Q3 Fiscal 2025 was $9.8 million, down from $11.9 million in the same period last year, primarily due to a $3.0 million decrease in CDMO gross profit[10]. - Operating loss for the three months ended February 23, 2025, was $(9,029,000), compared to a loss of $(895,000) for the same period in 2024[31]. - Net loss for the three months ended February 23, 2025, was $(14,769,000), compared to net income of $15,632,000 in the same period last year[32]. - Adjusted EBITDA for the three months ended February 23, 2025, was $5,704,000, a decrease from $6,377,000 in the prior year[35]. - The net loss (GAAP) is estimated to be $(38.6) million for 2025, compared to $(36.6) million in 2024, reflecting an increase due to asset disposal losses and elevated legal expenses[37]. Expenses - Selling, general and administrative expenses for Q3 Fiscal 2025 were $10.1 million, an increase from $9.8 million in the prior year, mainly due to a $1.1 million increase in stock-based compensation[11]. - Research and development expenses for the three months ended February 23, 2025, were $2,045,000, slightly down from $2,170,000 in the same period in 2024[31]. - Selling, general, and administrative expenses increased to $10,093,000 for the three months ended February 23, 2025, compared to $9,848,000 in the prior year[31]. - Stock-based compensation is expected to increase to $10.5 million in 2025, compared to $6.2 million in 2024[37]. - Reorganization costs are estimated at $11.4 million for 2025, up from $9.8 million in 2024[37]. Revenue Projections - The company expects full fiscal year 2025 revenue to be approximately $126.5 to $130 million and Adjusted EBITDA to be in the range of $19 to $21 million[20]. - Estimated revenues for the year ending May 25, 2025, are projected at $126.5 million, a decrease from $130 million in 2024[37]. Balance Sheet and Cash Flow - Total current assets as of February 23, 2025, were $84,211,000, an increase from $81,033,000 as of February 25, 2024[29]. - Total liabilities as of February 23, 2025, were $190,267,000, a decrease from $200,058,000 as of February 25, 2024[29]. - Cash and cash equivalents as of February 23, 2025, were $5,417,000, down from $8,462,000 as of February 25, 2024[29]. - The company strengthened its balance sheet by raising approximately $17.0 million through the sale of excess capital equipment[1]. - Lifecore's cash balance was enhanced through the sale of an unused high-speed, multi-purpose isolator filler, with an aggregate purchase price of $17 million[6]. Interest and Other Expenses - Interest expense for Q3 Fiscal 2025 was $5.5 million, up from $4.3 million in the same period last year[12]. - Interest expense is projected to rise to $22 million in 2025, up from $18.1 million in 2024[37]. - The company anticipates a change in fair value of debt derivatives resulting in a loss of $(3) million in 2025, compared to a loss of $(39.5) million in 2024[37]. - The loss on sale or disposal of assets is projected at $7.6 million for 2025, with no such loss reported in 2024[37]. - The company has revised its estimate for restructuring, reorganization, and stockholder activist settlement costs to approximately $11.5 million for 2025[37]. - The increase in net loss is partially offset by lower restructuring expenses related to the resolution of a historical lease obligation[37]. Business Development - Lifecore signed multiple new agreements with both new and existing customers, including a project expansion with a large multi-national pharmaceutical customer[4].

Core Insights - Lifecore Biomedical, Inc. reported revenues of $35.2 million for Q3 Fiscal 2025, a decrease of 2% compared to $35.7 million in the same period last year [7][12] - The company signed multiple development agreements with both new and existing customers, including a project expansion with a large multi-national pharmaceutical customer [4][3] - Lifecore strengthened its balance sheet by selling excess capital equipment, raising approximately $17 million [6][3] Financial Performance - Revenues for the nine months ended February 23, 2025, were $92.4 million, an increase of 2% compared to $90.4 million for the same period last year [13] - Gross profit for Q3 was $9.8 million, down from $11.9 million in the prior year, primarily due to a decrease in CDMO gross profit [9][12] - The company recorded a net loss of $14.8 million for Q3, compared to a net income of $15.6 million in the same period last year [12][30] Operational Developments - Lifecore has implemented strategies to enhance sustainability and profitability, resulting in improved operational efficiencies and margins [5][3] - The company is actively seeking opportunities to reduce operational expenses and strengthen its commitment to quality [5][3] Future Outlook - Lifecore reiterated its financial guidance for the full fiscal year 2025, expecting revenue to be approximately $126.5 to $130 million and Adjusted EBITDA to be in the range of $19 to $21 million [19][35]

Company Overview - Lifecore Biomedical, Inc. is a fully integrated contract development and manufacturing organization (CDMO) specializing in the development, fill, and finish of sterile injectable pharmaceutical products [3] - The company has over 40 years of expertise in manufacturing premium, injectable-grade hyaluronic acid and serves global and emerging biopharmaceutical and biotechnology companies across multiple therapeutic categories [3] Upcoming Financial Results - Lifecore will report its financial results for the third quarter of fiscal year 2025 on April 3, 2025, after market close [1] - A webcast hosted by Lifecore's senior management team will take place at 4:30 p.m. Eastern Time on the same day to discuss the financial results and recent corporate developments [1] Webcast Access - Investors can listen to the live webcast or access the archived version on Lifecore's Investor Events & Presentations page [2] - The archived version will be available for 30 days following the live event [2]

Core Insights - Lifecore Biomedical, Inc. will participate in multiple investor conferences and industry events in March 2025, showcasing its commitment to engaging with investors and industry stakeholders [1][2]. Group 1: Upcoming Events - Lifecore will present at the TD Cowen 45th Annual Health Care Conference on March 4, 2025, where CEO Paul Josephs will deliver a corporate presentation [1]. - The company will also participate in the KeyBanc Capital Markets Healthcare Forum on March 19, 2025, featuring a fireside chat with CEO Paul Josephs [2]. - Additionally, Lifecore will attend DCAT Week 2025 from March 17-20, 2025, engaging in meetings with current and prospective customers [2]. Group 2: Company Overview - Lifecore Biomedical is a fully integrated contract development and manufacturing organization (CDMO) specializing in the development, fill, and finish of sterile injectable pharmaceutical products [3]. - The company has over 40 years of expertise in manufacturing premium, injectable-grade hyaluronic acid, serving global and emerging biopharmaceutical and biotechnology companies [3].

Company Participation - Lifecore Biomedical, Inc. will participate in the 2025 BIO CEO & Investor Conference scheduled for February 10-11, 2025, in New York, NY [1] - The company's management, including CEO Paul Josephs and CFO Ryan Lake, will engage in 1-on-1 meetings during the conference [1] Company Overview - Lifecore Biomedical is a fully integrated contract development and manufacturing organization (CDMO) specializing in the development, fill, and finish of sterile injectable pharmaceutical products [2] - The company has over 40 years of expertise in manufacturing premium, injectable-grade hyaluronic acid and serves global and emerging biopharmaceutical and biotechnology companies across multiple therapeutic categories [2]