Codexis(US:CDXS)2022-02-25 04:41Financial Data and Key Metrics Changes - Total revenue for fiscal 2021 was $104.8 million, up 52% from 2020, marking the highest annual growth in over 10 years [45] - Product revenue for fiscal 2021 was $70.7 million, up 134% from 2020, primarily driven by sales to Pfizer for Paxlovid [47] - Gross margin on product revenue for fiscal 2021 was 68.6%, up from 54.5% in 2020, attributed to a favorable product mix [47] - The net loss for fiscal year 2021 was $21.2 million, an improvement from a net loss of $24.0 million in 2020 [48] Business Line Data and Key Metrics Changes - Performance Enzymes segment generated $90.5 million in revenue for fiscal 2021, compared to $48.1 million in 2020, driven by Paxlovid sales [45][46] - Novel Biotherapeutics segment reported $14.2 million in revenue for fiscal 2021, down from $21.0 million in 2020, impacted by strong R&D revenue in the prior year [45][46] - Product revenue for Q4 2021 was $17.0 million, up 39% from $12.2 million in Q4 2020, with $11.3 million from Paxlovid sales [43] Market Data and Key Metrics Changes - The Life Science Tools market generated over $7 million in sales in 2021, doubling from the prior year, with expectations for 50% growth in 2022 [24] - The food sector saw significant growth, with sales exceeding $3 million in 2021, driven by key partnerships [22] - The Performance Enzymes business is expected to deliver a nearly fourfold increase in product revenues over two years [11] Company Strategy and Development Direction - The company aims to continue investing in high ROI opportunities, particularly in the Life Science Tools and Biotherapeutics segments [10][57] - Codexis plans to maintain its focus on enzyme discovery and commercialization, with a goal of translating developmental-stage products into recurring commercial-stage products [77] - The strategy includes expanding R&D capabilities and investing in IND-enabling work for several programs in the Biotherapeutics segment [52][57] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving 50% year-on-year sales growth in 2022, driven by the Life Science Tools market and continued demand for Paxlovid [9][51] - The company highlighted the importance of maintaining a strong balance sheet, with cash and cash equivalents of $116.8 million as of December 31, 2021 [49] - Management noted the ongoing uncertainty related to the COVID-19 pandemic but emphasized the company's ability to adapt and capitalize on growth opportunities [4][10] Other Important Information - The company has not drawn any funds from its $50 million ATM facility established in May 2021, indicating a strong cash position [49] - Codexis expects to continue its focus on sustainable manufacturing processes, leveraging its engineered enzymes to reduce costs and improve efficiency [13][14] Q&A Session Summary Question: What are the expectations for product revenues excluding Pfizer? - Management confirmed modest growth in product revenues outside of Pfizer's Paxlovid sales, emphasizing confidence in translating developmental products into commercial sales [60][61] Question: What is the visibility on Paxlovid revenues for 2022? - Management stated that they have orders in hand covering the guidance range of $75 million to $80 million for Paxlovid sales in 2022, with additional purchase orders secured for early 2023 [62] Question: What is the likelihood of partnering Biotherapeutics programs? - Management indicated that they plan to advance their IND-enabling programs independently for now, with potential partnerships considered for later-stage clinical trials [63][64] Question: Are there opportunities to supply enzymes to generic manufacturers? - Management clarified that any business through the medicines patent pool with generic companies is not part of the Pfizer relationship, and visibility on this opportunity is limited [68][69] Question: What is the philosophy on capital allocation and reinvestment? - Management emphasized the importance of investing in enzyme discovery and development, particularly in the Biotherapeutics segment, to enhance long-term value [75][76]