Teknova(US:TKNO)2022-03-16 00:01Financial Data and Key Metrics Changes - Total revenue for Q4 2021 was $10.1 million, with a full year revenue of $36.9 million, representing a 31% year-over-year growth excluding Sample Transport [18] - Q4 revenue excluding Sample Transport was $9.6 million, a 26% increase from $7.6 million in Q4 2020, and $35.4 million for the full year 2021, a 31% increase from $27 million in 2020 [18] - Gross profit for Q4 2021 was $5.0 million, down from $5.6 million in Q4 2020, with a gross margin of 49.2%, down from 54.8% year-over-year [22] - Net loss attributable to common stockholders for Q4 2021 was $3.6 million, or $0.13 per diluted share, compared to a net income of $0.1 million, or $0.03 per diluted share in Q4 2020 [24] Business Line Data and Key Metrics Changes - Lab Essentials revenue grew 28% year-on-year to $27.2 million for the full year 2021, driven by an 18% increase in average revenue per active customer [12][20] - Clinical Solutions revenue grew 41% year-on-year to $6.8 million for the full year 2021, with active clinical customers increasing from 12 in 2020 to 22 in 2021 [12][21] Market Data and Key Metrics Changes - The company transitioned several accounts from solely purchasing catalog reagents to also purchasing custom research or GMP reagents, particularly in the cell and gene therapy customer base, which grew to approximately 80 accounts [13] - The company exited 2021 with the largest order book in its history, indicating strong market demand [13] Company Strategy and Development Direction - The company is focused on aggressive investments in 2022 to solidify its foundation for future growth, including increasing production capacity and building out commercial and marketing teams [15] - The new GMP manufacturing facility in Hollister, California is expected to be operational by the end of 2022, with an annual production capacity of $150 million [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory for 2022, projecting total revenue between $44 million and $48 million, representing a growth rate of approximately 30% at the midpoint [27] - The company anticipates continued investment in capacity expansion and marketing, with expectations of EBITDA breakeven by early 2024 [52] Other Important Information - The company reported a significant increase in operating expenses due to investments in personnel and public company costs, with operating expenses for Q4 2021 at $9.7 million compared to $4.8 million in Q4 2020 [23] - Free cash flow for Q4 2021 was negative $10.5 million, primarily due to lower adjusted EBITDA and increased capital expenditures [26] Q&A Session Summary Question: Revenue cadence and seasonality - Management indicated that there is no particular seasonality to the business, expecting a ramp in revenue throughout the year, with some lumpiness in clinical solutions [33] Question: Drivers of gross margins - Management noted that Q4 gross margin was higher than anticipated due to increased revenue performance, but expected margins to decrease in 2022 due to investments in the new facility [35] Question: Clinical solutions demand visibility - Management expressed confidence in clinical solutions demand based on discussions with new customers and their onboarding as GMP customers [39] Question: Sales team effectiveness - Management highlighted traction in customer engagement and growth in active clinical customers, indicating positive impacts from the sales team [57]