Cryoport, Inc. (OTCBB: CYRX) today announced financial results for the three and twelve-month periods ended March 31, 2015.
Results for the fiscal year ended March 31, 2015
Net revenues increased 48% to $3.9 million for the year ended March 31, 2015, as compared with $2.7 million for the year ended March 31, 2014. This increase was driven by Cryoport's overall growth across the board and in the number of customers using Cryoport Express® Solutions compared with the same period in the prior year.
Gross margin nearly doubled to 30% of net revenues for the year ended March 31, 2015, as compared with a gross margin of 16% of net revenues for the year ended March 31, 2014. The increase in gross margin illustrates the operating leverage in the business model as revenue continues to ramp.
Selling, General and Administrative ("SG&A") costs increased 26% to $6.4 million for the year ended March 31, 2015, compared with $5.1 million for the same period last year. The increase in SG&A is primarily attributable to the expansion of the company's sales team to support future growth projections of the business in key regions, as well as an increase in investor relations activities and public company related expenses.
The Company reduced its net loss attributable to common stockholders by 38% for the fiscal year ended March 31, 2015 to $12.2 million or $2.44 per share, compared with a net loss of $19.6 million or $4.81 per share for the same period last year. The net loss attributable to common stockholders for the fiscal year ended March 31, 2015 included a non-cash, preferred stock beneficial conversion charge of $4.9 million; while the net loss attributable to common stockholders for fiscal year 2014 includes a one-time, non-cash debt conversion expense of $13.7 million.
Results for the fourth quarter ended March 31, 2015
Net revenues increased 44% to $1.2 million for the quarter ended March 31, 2015, as compared with $835,000 for the same period last year. This increase was primarily driven by Cryoport's overall growth across the board and in the number of customers using Cryoport Express® Solutions compared with the same period in the prior year. In addition, Cryoport made a number of key announcements during the quarter including announcing relationships in which Cryoport is supporting the clinical programs of Kite Pharma, Sanaria, and Capricor Therapeutics.
Gross margin nearly doubled for the three months ended March 31, 2015 to 31% of net revenues, as compared with a gross margin of 17% of net revenues for the three months ended March 31, 2014. The decline in cost of revenue as a percentage of revenues for the quarter demonstrates Cryoport's ability to profitably scale its business over the past twelve months.
Net loss attributable to common stockholders for the three months ended March 31, 2015 was $4.0 million, or $0.79 per basic and diluted share compared with a net loss attributable to common stockholders of $1.4 million, or $0.29 per basic and diluted share, for the same period last year. The net loss attributable to common stockholders for the quarter ended March 31, 2015 included a non-cash, preferred stock beneficial conversion charge of $1.9 million; while there were no comparable charges in the prior year quarter.
Cryoport's Chief Executive Officer, Jerrell Shelton, commented, "We are pleased to deliver another quarter of double digit growth and close out the fiscal year with a 48% jump in revenue, year over year. We have scaled our operations to a level that our gross margin is in the range of 30%, or $1.2 million for the year, which is a 168% improvement over our previous fiscal year. With the momentum we are seeing in the business, we are also working towards an uplisting to the Nasdaq, to attract institutional investors, increase stock liquidity and enhance the value of our company."
"The growth for the year was driven by a diverse base of new and expanding client relationships and a further increase in our IVF business. Most of these clients are either in the early stages of their product development or in the early stages of introducing our solutions to their operations. We view this as 'built in' growth as there are significant opportunities for these relationships to expand over time. Many of these companies are in exciting market segments that are experiencing significant growth, such as CAR-T Cells, stem cells, cell therapies, cell line manufacturing, research, and vaccines, as well as animal husbandry and in vitro fertilization (IVF). In addition, our support of clinical trials is also developing in all segments and across all regions. In fact, as of the end of the fourth quarter, Cryoport was actively supporting the logistics needs for 34 clinical trials including six phase III programs."
"As an example, one leading animal health company and a significant client of ours, incorporates one of our most comprehensive solutions into their business with our on-site logistics personnel who use our Cryoportal™, which is our logistics management platform to provide a fully outsourced cryogenic logistics service. This outsourced solution is comprehensive and we can leverage it across various client bases to support their respective, specific and customized cryogenic logistics requirements.
"Another example of our capabilities is exhibited in our partnership with a biotechnology company in the orthopedic industry, which we think has significant potential. We designed and initiated a program that combines various elements of our proprietary, purpose-built cold chain logistics solutions with this company's product and distribution capabilities. The unique relationship incorporates our advanced logistics expertise and utilizes our patented liquid nitrogen (LN2) dry vapor shippers allowing for 'points-of-use' by US-based orthopedic medical care providers. This extended use model, our Regenerative Medicine Point-of-Care Repository Solution, eliminates the need for locally based cryogenic freezers at each location of delivery.
"Looking ahead, our strategic growth initiatives position us to capture many of the new and growing opportunities ahead, as we scale our operations for accelerated success. This includes investments in our sales and marketing teams, as well as research and development, to capture a larger portion of the market. Due to overall growth trends for the life sciences industry, we believe the growth trajectory of our business of providing advanced, leading-edge cryogenic logistics solutions will advance at a robust pace," concluded Mr. Shelton.
Plan for Uplisting of Common Stock
The Company also announced today that its Board of Directors (the "Board") has implemented a strategy to support the uplisting of its common stock to The Nasdaq Capital Market® (the "Exchange"). As part of this strategy the Board approved a reverse stock split at a ratio of 1-for-12, which is effective today, May 19, 2015. Every 12 shares of common stock outstanding have been automatically combined into one new share of common stock with no change in the par value per share and the number of authorized shares of common stock has been reduced from 250,000,000 to 20,833,333. Any fractional shares resulting from the reverse stock split will be rounded to the next whole share.
The Company's ticker symbol, "CYRX", will remain unchanged; however the ticker symbol will be represented as "CYRXD" for a period of 20 business days after the reverse stock split has been effected in the marketplace. The Company's common stock will also trade under a new CUSIP number (229050307). The reverse stock split is the first step in the Company's plan to meet the listing requirements of the Exchange. Additional steps will need to be implemented before the Company will satisfy such requirements and there can be no assurance that the Exchange will approve the company's listing application in the future.
Holders of shares of common stock held in book-entry form or through a bank, broker or other nominee do not need to take any action in connection with the reverse split, and will see the impact of the reverse split automatically reflected in their accounts. Beneficial holders may contact their bank, broker or nominee for more information. For those shareholders who hold physical stock certificates, the Company's transfer agent, Continental Stock Transfer & Trust Company ("Continental"), will exchange your current stock certificates for new stock certificates. For more information, contact the Reorganization Department of Continental at (917) 262-2378 or 17 Battery Place, 8th Floor, New York, New York 10004.
Cryoport's breakthrough technologies, including LN2 dry vapor dewars, enables 10 days of minus 150° C temperature stability for cryogenically frozen commodities including biospecimens, immunotherapeutics, general therapeutics, embryos, eggs, semen, keeping them well below glass transition (Tg) temperature where biological activity ceases. The old technology, dry ice, is often relied on for life sciences commodities, but it is considerably warmer at temperature of minus 80° C which can introduce temperature fluctuations that could impact the integrity of a frozen specimen or the efficacy of a valuable therapeutic. Other methods include using LN2, in liquid form, stored in dewars that must be transported on bulky stabilizing platforms. Both present safety issues and can be hazardous.
Cryoport, on the other hand, provides standard and customized, safe, portable, and trackable solutions for shipping temperature-sensitive, cryogenically frozen biological materials through our proprietary and patented technologies, including our Cryoport Express® Shippers, which are charged by liquid nitrogen in the dry vapor phase. Cryoport Express® Solutions also provide complete "chain of custody" information and, at the client's election, full "chain of condition" information along with intervention capability.
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