WEST LAFAYETTE, Ind., Feb. 13, 2026 (GLOBE NEWSWIRE) -- Inotiv, Inc. (NASDAQ: NOTV) (the “Company”, or “Inotiv”), a leading contract research organization specializing in nonclinical and analytical drug discovery and development services and research models and related products and services, is providing public notice regarding its cybersecurity incident that it became aware of on August 8, 2025. As previously described in the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commi ...

Financial Performance - Total revenue for the three months ended December 31, 2025, was $120.879 million, a slight increase of 0.8% compared to $119.876 million in the same period of 2024[12] - Service revenue increased to $59.721 million, up 11.9% from $53.557 million year-over-year[12] - Consolidated net loss for the quarter was $28.378 million, compared to a net loss of $27.630 million in the prior year, reflecting a 2.7% increase in losses[12] - Basic and diluted loss per common share was $0.83, an improvement from a loss of $1.02 per share in the same quarter of 2024[12] - The company reported an operating loss of $16.330 million for the quarter, compared to an operating loss of $15.507 million in the same quarter of 2024[12] - Consolidated net loss for the three months ended December 31, 2025, was $28,378,000, compared to a loss of $27,630,000 for the same period in 2024[19] - The Company reported total segment operating income of $15,285 for the three months ended December 31, 2025, compared to $16,526 in 2024[52] - The RMS segment's operating income decreased to $7,059 for the three months ended December 31, 2025, from $9,438 in 2024[52] Assets and Liabilities - Total assets decreased to $734.336 million as of December 31, 2025, down from $771.114 million at September 30, 2025, representing a decline of 4.8%[10] - Total liabilities were $625.312 million, a decrease of 1.5% from $635.086 million in the previous quarter[10] - Cash and cash equivalents decreased to $12.732 million from $21.741 million, a decline of 41.5%[10] - Inventories decreased slightly to $44.320 million from $45.738 million, a reduction of 3.1%[10] - The Company had a balance of $6,000,000 outstanding on its $15,000,000 revolving credit facility as of December 31, 2025[26] - The Company has trade receivables of $58,650 and unbilled revenue of $11,011 as of December 31, 2025, totaling $69,661, with a net amount of $63,176 after accounting for an allowance for credit losses of $6,485[116] Cash Flow and Capital Expenditures - Net cash used in operating activities was $5,433,000 for the three months ended December 31, 2025, compared to $4,497,000 for the same period in 2024[19] - Cash and cash equivalents at the end of the period were $12,732,000, down from $38,043,000 at the end of the same period in 2024[19] - Capital expenditures for the three months ended December 31, 2025, were $5,180,000, compared to $4,459,000 for the same period in 2024[19] - Cash paid for interest during the three months ended December 31, 2025, was $9,685,000, compared to $10,888,000 for the same period in 2024[19] Revenue Recognition and Deferred Revenue - The company expects approximately 77% of deferred revenue as of December 31, 2025, to be recognized as revenue within the next twelve months[48] - Deferred revenue includes client deposits of $17,288,000 and deferred revenue of $19,740,000 as of December 31, 2025[46] - One client accounted for 14.1% of revenue during the three months ended December 31, 2025, down from 20.5% in the same period of 2024[43] Debt and Financing - The Company is exploring potential debt refinancing alternatives to address liquidity needs and compliance with covenants[31] - The Company has a Term Loan Facility with an original principal amount of $165 million, a delayed draw term loan facility of $35 million, and a revolving credit facility of $15 million[61] - The effective interest rates for the Term Loan and Initial DDTL are 11.57% and 11.56% respectively for the three months ended December 31, 2025[60] - The Company issued $22,000 in Second Lien Notes and Warrants, with $17,000 in cash and cancellation of $8,333 of existing Notes[93] - The Company issued $140,000 principal amount of Convertible Senior Notes, with an option for an additional $15,000[103] Legal and Regulatory Matters - The Company recorded a settlement accrual of $11,000 as of December 31, 2025, related to ongoing negotiations for a securities class action lawsuit[122] - The Company is involved in three putative class actions related to a cybersecurity incident in August 2025, which have been consolidated under one caption[158] - The Company is subject to a Resolution Agreement and Plea Agreement with the DOJ, involving payments totaling $22,000 in fines, with specific payment schedules[164] - The Company has taken a reserve equal to the proposed settlement amount of $795 for the PAGA Settlement Agreement, which is subject to court approval[159] Corporate Governance and Compliance - The Company agreed to implement corporate governance measures for at least five years, including having a separate CEO and Board Chairperson[156] - Management's fiscal 2026 annual operating plan forecasts noncompliance with financial covenants for the remainder of fiscal 2026[27] Other Financial Metrics - The effective tax rate for the Company was 5.5% for the three months ended December 31, 2025, down from 7.3% in the same period of 2024[144] - Stock-based compensation expense for the three months ended December 31, 2025, was $1,382 million, down from $1,770 million in the same period of 2024[140] - The Company’s accrued expenses and other current liabilities total $41,148 as of December 31, 2025, down from $44,722 as of September 30, 2025[121]

You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Any forward-looking statement made by us is based only on information currently available to us and speaks only as of the date on which it is made. I ...

Financial Data and Key Metrics Changes - For Q1 of fiscal 2026, total revenue was $120.9 million, a slight increase of $1 million or 0.8% from $119.9 million in Q1 of fiscal 2025, primarily driven by increased DSA revenue and partially offset by decreased RMS revenue [12][19] - DSA revenue increased to $48 million from $42.8 million, representing a year-over-year growth of 12%, with discovery pharmacology service and surgical services contributing significantly [5][12] - RMS revenue decreased by $4.1 million or 5.4% to $72.9 million, primarily due to lower NHP volumes sold [14][15] - The overall operating loss increased to $16.3 million from $15.5 million, driven by a higher RMS operating loss [16][19] - Consolidated net loss totaled $28.4 million or $0.83 loss per diluted share, compared to a net loss of $27.6 million or $1.02 loss per diluted share in the prior year [18][19] Business Line Data and Key Metrics Changes - DSA business saw strong growth with net new awards of $53.6 million, a 27% increase over Q1 of fiscal 2025, and a trailing twelve-month increase of 34% [13] - DSA margins improved, with non-GAAP operating income for the DSA segment at $8.2 million or 6.8% of total revenue, up from $7.1 million or 5.9% [17] - RMS segment's non-GAAP operating income decreased to $7.2 million or 5.9% of total revenue, down from $9.4 million or 7.9% due to lower NHP volume sales [18] Market Data and Key Metrics Changes - The book-to-bill ratio for DSA in Q1 of fiscal 2026 was 1.16 to 1, with a trailing twelve-month book-to-bill of 1.08 to 1 [14] - DSA backlog increased to $145.4 million at December 31, 2025, compared to $138.2 million at September 30, 2025 [14] Company Strategy and Development Direction - The company is focused on improving revenue and margins in the DSA business while reducing costs and diversifying revenue sources in the RMS business [10] - The company is enhancing its NAM strategy to support FDA guidance and industry expectations for innovation, with recent collaborations aimed at integrating advanced machine learning tools [10][50] - The company is committed to optimizing its operational footprint and product portfolio while maintaining client satisfaction [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the DSA business's momentum and the ongoing site optimization and cost reduction initiatives in the RMS business [9] - The company is navigating macroeconomic factors affecting the RMS business and remains committed to refinancing its debt and improving its balance sheet [9][20] - Management anticipates continued improvement in margins and revenue growth in the DSA segment as pricing stabilizes and operational efficiencies are realized [26][31] Other Important Information - The company engaged Perella Weinberg Partners for financial advisory services to explore debt refinancing alternatives [9] - Capital expenditures for Q1 of 2026 were $5.2 million, with expectations to keep annual CapEx below 4% of revenue [21][22] Q&A Session Summary Question: Can you provide more details on profitability and adjusted EBITDA trends? - Management noted that seasonality impacts the first quarter, and increased operating expenses were observed, particularly in cost of goods sold [25][26] Question: What is the outlook for DSA awards and growth? - Management highlighted that DSA growth is supported by improved customer relationships and scientific strength, with expectations for continued positive trends [28][30] Question: Can you explain the recent decline in RMS revenue and operating leverage? - Management indicated that reduced NHP volumes overshadowed operating leverage benefits, but cost reductions from facility closures are expected to yield improvements in future quarters [38][40] Question: How are recent weather conditions impacting operations and costs? - Management confirmed that weather impacts shipping and operations, but the overall cost impact is not significant [51][52]

Financial Data and Key Metrics Changes - For Q1 of fiscal 2026, total revenue was $120.9 million, a slight increase of $1 million or 0.8% from $119.9 million in Q1 of fiscal 2025, primarily driven by increased DSA revenue and partially offset by decreased RMS revenue [12][19] - DSA revenue increased to $48 million from $42.8 million, reflecting a year-over-year growth of 12%, with discovery pharmacology service and surgical services contributing significantly [5][12] - RMS revenue for Q1 of fiscal 2026 was $72.9 million, a decrease of $4.1 million or 5.4% compared to the prior year, primarily due to lower NHP volumes sold [14][15] - The overall operating loss increased to $16.3 million from $15.5 million in the prior year, driven by an increase in RMS operating loss [16][19] - Consolidated net loss totaled $28.4 million or $0.83 loss per diluted share, compared to a net loss of $27.6 million or $1.02 loss per diluted share in Q1 of fiscal 2025 [18][19] Business Line Data and Key Metrics Changes - DSA business saw strong growth with net new awards of $53.6 million, a 27% increase over Q1 of fiscal 2025, and a 34% year-over-year increase for the trailing twelve-month period [13][19] - DSA margins improved, with non-GAAP operating income for the DSA segment at $8.2 million or 6.8% of total revenue, compared to $7.1 million or 5.9% in the prior year [17] - RMS segment reported non-GAAP operating income of $7.2 million or 5.9% of total revenue, down from $9.4 million or 7.9% in the prior year, primarily due to lower NHP volume sales [18] Market Data and Key Metrics Changes - The book-to-bill ratio for DSA in Q1 of fiscal 2026 was 1.16 to 1, with a trailing twelve-month book-to-bill ratio of 1.08 to 1, indicating a healthy order intake relative to revenue [6][14] - DSA backlog increased to $145.4 million at December 31, 2025, compared to $138.2 million at September 30, 2025, and $130.4 million at December 31, 2024 [14] Company Strategy and Development Direction - The company is focused on improving revenue and margins in the DSA business while reducing costs and diversifying revenue sources in the RMS business [10][11] - The company is enhancing its NAM strategy to support FDA guidance and industry expectations for innovation, with recent collaborations aimed at integrating advanced machine learning tools [10][50] - The site optimization plan is expected to improve margins in future periods, with the current phase set to complete by Q3 of fiscal 2026 [7][9] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about the DSA business's momentum and the ongoing site optimization and cost reduction initiatives in the RMS business [9][10] - The company is navigating macroeconomic factors affecting the RMS business and remains committed to refinancing its debt and improving its balance sheet [9][20] - Management noted that while the first quarter typically experiences seasonality challenges, they expect to see improvements in margins and revenue in the latter half of the fiscal year [26][28] Other Important Information - The company has received a waiver for non-compliance with financial covenant ratios under its credit agreement for Q1 of fiscal 2026 [9] - Capital expenditures in Q1 of 2026 were $5.2 million, with expectations for annual CapEx to remain below 4% of revenue [21][22] Q&A Session Summary Question: Can you provide more details on profitability and adjusted EBITDA trends? - Management acknowledged that margins in RMS impacted adjusted EBITDA, with some operational expenses higher than expected, and indicated that seasonality will likely follow previous patterns [25][26] Question: What is driving the positive trend in DSA awards? - Management attributed the growth in DSA awards to improved customer relationships, increased sales force efforts, and scientific strengths within the company [29][31] Question: What is the outlook for RMS operating leverage? - Management indicated that reduced NHP volumes overshadowed operating leverage benefits, but cost reductions from facility closures will contribute positively in future quarters [40][42] Question: How much was NHP volume down year-over-year? - Management reported that NHP volumes were down approximately 25% year-over-year [44][45] Question: Can you elaborate on new relationships in the NAM space? - Management highlighted ongoing R&D efforts and collaborations aimed at innovation, which are expected to drive incremental revenues [49][50]

Financial Data and Key Metrics Changes - Total revenue for Q1 2026 was $120.9 million, a slight increase of $1 million or 0.8% compared to $119.9 million in Q1 2025, primarily driven by increased DSA revenue and partially offset by decreased RMS revenue [11][18] - DSA revenue increased to $48 million from $42.8 million, reflecting a year-over-year growth of 12% [5][11] - RMS revenue decreased by 5.4% to $72.9 million, primarily due to lower NHP volumes sold [7][13] - The overall operating loss increased to $16.3 million from $15.5 million, driven by a higher RMS operating loss [14][18] - Consolidated net loss totaled $28.4 million or $0.83 loss per diluted share, compared to a net loss of $27.6 million or $1.02 loss per diluted share in Q1 2025 [17][18] Business Line Data and Key Metrics Changes - DSA business saw strong growth with discovery awards up 44% and safety assessment awards up 22% year-over-year [6] - DSA margins improved, achieving the strongest first quarter margins in three years [6][15] - RMS services revenue grew by 13% compared to Q1 2025, mainly due to higher NHP colony management services revenue [7][13] - The book-to-bill ratio for DSA was 1.16 to 1 for the quarter and 1.08 to 1 for the trailing twelve months [6][13] Market Data and Key Metrics Changes - The DSA backlog increased to $145.4 million at December 31, 2025, compared to $138.2 million at September 30, 2025 [13] - The conversion rate for DSA backlog was 33.2%, slightly up from 32.8% in the prior year [12] Company Strategy and Development Direction - The company is focused on improving revenue and margins in the DSA business while reducing costs and diversifying revenue sources in the RMS business [9] - Continued emphasis on innovation through collaborations that integrate machine learning tools and enhance data analysis capabilities [9][50] - The company is committed to optimizing its operational footprint and enhancing client satisfaction [10][57] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in the RMS business due to macroeconomic factors and lower NHP sales, but expressed optimism about future improvements in margins [8][9] - The company plans to resume providing financial guidance once there is greater clarity on market demand and tariff impacts [20][21] - Management remains confident in the company's strategic direction and ongoing improvements in financial performance [57] Other Important Information - The company engaged Perella Weinberg Partners for financial advisory services to explore debt refinancing alternatives [8] - Capital expenditures for Q1 2026 were $5.2 million, with expectations to keep annual CapEx below 4% of revenue [20] Q&A Session Questions and Answers Question: Can you provide more detail on profitability and adjusted EBITDA trends? - Management indicated that seasonality impacts the first quarter, and increased operating expenses were noted, particularly in cost of goods sold [23][25] Question: What is the outlook for DSA awards and growth? - Management highlighted that DSA growth is supported by improved customer relationships and scientific capabilities, contributing to increased recurring sales [28][30] Question: How will the recent lease exits impact operating costs? - Management confirmed that lease exits will lead to additional cost reductions in the upcoming quarters, although current volume reductions in NHPs overshadowed some operating leverage benefits [38][40]

Revenue Performance - Revenue for Q1 FY 2026 was $120.9 million, a slight increase of 0.8% compared to $119.9 million in Q1 FY 2025, driven by a 12.0% increase in DSA revenue[6][9] - DSA revenue reached $48.0 million, up from $42.8 million in the prior year, while RMS revenue decreased to $72.9 million from $77.1 million, reflecting a 5.4% decline[2][7] - Total revenue for the company in Q4 2025 was $120,879 million, slightly up from $119,876 million in Q4 2024, showing a marginal increase of about 0.8%[31] Profitability and Loss - Consolidated net loss for Q1 FY 2026 was $28.4 million, or 23.5% of total revenue, compared to a net loss of $27.6 million, or 23.0% of total revenue, in Q1 FY 2025[7][9] - Operating loss for Q1 FY 2026 was $16.3 million, an increase of 5.3% from $15.5 million in Q1 FY 2025, primarily due to increased RMS operating loss[10] - Consolidated net loss for the three months ended December 31, 2025, was $28,378 million, compared to a net loss of $27,630 million for the same period in 2024, indicating a year-over-year increase in losses[28] Cash Flow and Assets - Cash and cash equivalents decreased to $12.7 million at December 31, 2025, down from $21.7 million at September 30, 2025[11] - Total assets decreased from $771,114 million as of September 30, 2025, to $734,336 million as of December 31, 2025, representing a decline of approximately 4.8%[26] - Cash and cash equivalents decreased from $21,741 million at the beginning of the period to $12,732 million at the end of the period, a decrease of approximately 41.5%[28] Operational Metrics - Adjusted EBITDA for Q1 FY 2026 was $1.8 million, representing 1.5% of total revenue, down from $2.6 million, or 2.2% of total revenue, in Q1 FY 2025[7][9] - Non-GAAP adjusted EBITDA for the three months ended December 31, 2025, was $1,803 million, down from $2,610 million in the same period of 2024, indicating a decline of approximately 30.9%[32] - The company reported an operating loss of $16,330 million for the three months ended December 31, 2025, compared to an operating loss of $15,507 million for the same period in 2024, reflecting a worsening of approximately 5.3%[31] DSA Segment Performance - The book-to-bill ratio for the DSA services business was 1.16x in Q1 FY 2026, indicating strong demand for services[7] - DSA backlog increased to $145.4 million as of December 31, 2025, up from $138.2 million at September 30, 2025, and $130.4 million at December 31, 2024[7] - Revenue for the DSA segment increased to $47,955 million in Q4 2025, up from $42,822 million in Q4 2024, reflecting a growth of approximately 7.5%[30] Unusual Costs - The company incurred $2,204 million in other unusual, third-party costs during Q4 2025, primarily related to legal matters and cybersecurity incidents[34]

Core Viewpoint - Inotiv, Inc. reported a slight revenue increase in Q1 FY 2026, driven by growth in its Discovery and Safety Assessment (DSA) segment, while facing challenges in its Research Models and Services (RMS) segment [1][3][6]. Financial Performance - Total revenue for Q1 FY 2026 was $120.9 million, a 0.8% increase from $119.9 million in Q1 FY 2025, attributed to a $5.1 million (12.0%) rise in DSA revenue, offset by a $4.1 million (5.4%) decline in RMS revenue [2][7][8]. - The consolidated net loss for Q1 FY 2026 was $28.4 million, or 23.5% of total revenue, compared to a net loss of $27.6 million, or 23.0% of total revenue, in Q1 FY 2025 [7][30]. - Adjusted EBITDA for Q1 FY 2026 was $1.8 million, representing 1.5% of total revenue, down from $2.6 million, or 2.2% of total revenue, in Q1 FY 2025 [7][30]. Segment Performance - DSA segment revenue increased to $48.0 million in Q1 FY 2026 from $42.8 million in Q1 FY 2025, reflecting a 12.0% growth [2][8]. - RMS segment revenue decreased to $72.9 million in Q1 FY 2026 from $77.1 million in Q1 FY 2025, marking a 5.4% decline [2][8]. - The DSA backlog was $145.4 million at December 31, 2025, up from $138.2 million at September 30, 2025, and $130.4 million at December 31, 2024 [7]. Operational Insights - The company exited two leased facilities as part of its U.S. site optimization plan during Q1 FY 2026 [5]. - Management emphasized a focus on client service and margin discipline, with a 27% year-over-year growth in DSA net awards, indicating strong demand trends [3][6]. Cash Flow and Capital Structure - Cash and cash equivalents decreased to $12.7 million at December 31, 2025, from $21.7 million at September 30, 2025 [10]. - Cash used in operating activities was $5.4 million for Q1 FY 2026, compared to $4.5 million in Q1 FY 2025 [10][25]. - Total debt as of December 31, 2025, was $405.8 million, up from $402.1 million on September 30, 2025 [10].

Core Viewpoint - Inotiv, Inc. will release its financial results for the fiscal 2026 first quarter on February 9, 2026, before the market opens, and will host a conference call to discuss these results [1]. Company Overview - Inotiv, Inc. is a leading contract research organization that specializes in nonclinical and analytical drug discovery and development services, as well as research models and related products [3]. - The company's focus is on enhancing the efficiency and data quality of drug and medical device development while reducing costs associated with bringing new products to market [3]. - Inotiv is dedicated to supporting research and development objectives, aiming to help researchers maximize the potential of their projects for a healthier and safer world [3].

Core Insights - Inotiv, Inc. announced a strategic initiative to integrate LifeNet Health's proprietary TruVivo system into its Discovery and Translational Sciences business, enhancing its drug development capabilities [1][3] Group 1: Company Overview - Inotiv, Inc. is a leading contract research organization focused on nonclinical and analytical drug discovery and development services, aiming to improve efficiency and reduce costs in bringing new drugs and medical devices to market [4] - The company is dedicated to supporting research and development objectives while promoting a healthier and safer world [4] Group 2: Technology and Collaboration - LifeNet Health has developed the TruVivo system, which utilizes primary human hepatocytes with human-derived feeder cells to create in vitro models that better predict human responses to therapies, addressing significant challenges in drug development [2] - The integration of the TruVivo platform into Inotiv's offerings will enhance the alignment of preclinical models with human biology and expand human-relevant tissue models beyond the liver, facilitating innovation across various human diseases [3] Group 3: Mission and Vision - Both Inotiv and LifeNet Health share a mission to accelerate scientific innovation that translates into meaningful human impact, emphasizing the importance of human-relevant technologies in preclinical research [3][5]