On November 5, 2020 BioLife Solutions, Inc. (NASDAQ: BLFS) ("BioLife" or the "Company"), a leading developer and supplier of a portfolio of class-defining bioproduction products and services for cell and gene therapies, reported financial results for the three and nine months ended September 30, 2020 (Press release, BioLife Solutions, NOV 5, 2020, View Source [SID1234570217]).

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Total revenue for the third quarter of 2020 was $11.3 million, a 71% increase over the third quarter of 2019. Revenue growth was driven by increased sales of the Company’s biopreservation media products and by acquisitions completed in the second half of 2019. Revenue from biopreservation media accounted for 66% of total revenue in the third quarter of 2020. Sales of the Company’s ThawSTAR, evo and Custom Biogenic Systems (CBS) freezer products accounted for the balance of revenue and were in line with management’s revised expectations based on the effects of COVID-19.

Mike Rice, BioLife President & CEO, commented, "The team delivered another solid quarter of execution and growth. We gained 56 new customers across the business. We also brought SciSafe into the Company via the acquisition that closed on October 1st. This addition strengthens our value proposition to cell and gene therapy developers. BioLife is configured for continued success as the cell and gene therapy market matures over the next several years."

Third Quarter 2020 and Recent Accomplishments

Entered into a purchase agreement with SciSafe Holdings, Inc., which became a wholly owned subsidiary of the Company on October 1, 2020. Management estimates that SciSafe will contribute revenue of at least $9 million in 2021.
Raised $86 million in gross proceeds through an oversubscribed follow-on public offering of 5,951,250 shares of common stock.
Booked biopreservation media revenue of $7.4 million, representing 66% of total revenue. Media revenue increased 22% compared with the same period in 2019.
Gained 56 new customers including 21 using biopreservation media, 7 using ThawSTAR products, 5 using evo cold chain management solutions and 23 placing initial orders for CBS freezers and related accessories.
Processed 22 new U.S. FDA Drug Master File cross-reference requests, indicating the planned use of CryoStor or HypoThermosol in pending cell and gene therapy clinical trials. To date, the Company’s biopreservation media products have been incorporated into more than 450 customer clinical applications, including several COVID-19 treatments or vaccines.
Financial Highlights for the Third Quarter and Nine Months Ended September 30, 2020

BioLife Solutions is presenting various financial metrics under U.S. Generally Accepted Accounting Principles (GAAP) and as adjusted (non-GAAP) to reflect acquisition-related activity. A reconciliation of GAAP to non-GAAP metrics appears at the end of this news release.

REVENUE

Total revenue for the third quarter of 2020 increased 71% to $11.3 million compared with $6.6 million for the third quarter of 2019.
Biopreservation media revenue was $7.4 million, up 22% over the third quarter of 2019
Automated thawing product revenue was $277,000
evo cold chain management rental revenue was $494,000
CBS freezer and related accessories revenue was $3.1 million
Total revenue for the nine months ended September 30, 2020 increased 75% to $33.4 million compared with $19.1 million for the first nine months of 2019.
Biopreservation media revenue was $22.8 million, up 25% over the nine months ended September 30, 2019
Automated thawing product revenue was $1.0 million
evo cold chain management rental revenue was $1.4 million
CBS freezer and related accessories revenue was $8.2 million
GROSS MARGIN

Gross margin (GAAP) for the third quarter of 2020 was 52% compared with 64% for the third quarter of 2019, while adjusted gross margin (non-GAAP) for the third quarter of 2020 was 57% compared with 69% for the third quarter of 2019.
Gross margin (GAAP) for the nine months ended September 30, 2020 was decreased to 53% compared with 68% for the same period in 2019, while adjusted gross margin (non-GAAP) for the nine months ended September 30, 2020 was 60% compared with 71% for the nine months ended September 30, 2019.
The decline in 2020 third quarter and nine month gross margin was due to products acquired in the second half of 2019 having lower margins than biopreservation media products and to higher manufacturing overhead.
OPERATING EXPENSE

Operating expense (GAAP) for the third quarter of 2020 was $12.5 million compared with $7.4 million for the third quarter of 2019, while adjusted operating expense (non-GAAP) for the third quarter of 2020 was $6.8 million compared with $4.6 million for the third quarter 2019.
Operating expense (GAAP) for the nine months ended September 30, 2020 was $34.2 million compared with $18.5 million for the same period in 2019, while adjusted operating expense (non-GAAP) for the nine months ended September 30, 2020 was $19.3 million compared with $11.8 million for the nine months ended September 30, 2019.
The increase in 2020 third quarter and nine month operating expense was primarily due to acquisitions completed in the second half of 2019.
OPERATING INCOME/(LOSS)

Operating loss (GAAP) for the third quarter of 2020 was $1.2 million compared with $772,000 for the third quarter of 2019, while adjusted operating loss (non-GAAP) for the third quarter of 2020 was $359,000 compared with $68,000 for the third quarter of 2019.
Operating loss (GAAP) for the nine months ended September 30, 2020 was $832,000 compared with operating income of $541,000 for the same period in 2019, while adjusted operating income (non-GAAP) for the nine months ended September 30, 2020 was $547,000 compared with $1.7 million for the nine months ended September 30, 2019.
NET INCOME/(LOSS)

Net loss (GAAP) for the third quarter of 2020 was $1.1 million compared with net income of $10.3 million for the third quarter of 2019. Net loss (GAAP) for the third quarter of 2020 included other expense of $1.0 million related to the change in fair value of warrants and other income of $1.1 million related to change in fair value of investments. Net income for the third quarter of 2019 included other income of $1.1 million related to the change in fair value of warrants and other income of $10.1 million related to the gain on acquisition of SAVSU. Adjusted net loss (non-GAAP) for the third quarter of 2020 was $346,000 compared with adjusted net income of $41,000 for the third quarter of 2019.
Net income (GAAP) for the nine months ended September 30, 2020 was $4.8 million compared with a net loss of $4.6 million for the same period in 2019. Net income (GAAP) for the nine months ended September 30, 2020 included other income of $4.5 million related to the change in fair value of warrants, other income of $1.5 million related to the change in fair value of contingent consideration and other income of $1.1 million related to the change in fair value of investments. Net loss for the nine months ended September 30, 2019 included other expense of $15.0 million related to the change in fair value of outstanding warrants and other income of $10.1 million related to the gain on acquisition of SAVSU. Adjusted net income (non-GAAP) for the nine months ended September 30, 2020 was $606,000 compared with adjusted net income of $2.1 million for the nine months ended September 30, 2019.
EARNINGS/(LOSS) PER SHARE

Loss per diluted share (GAAP) for the third quarter of 2020 was $0.04 compared with earnings per diluted share of $0.35 for the third quarter of 2019. Adjusted loss per diluted share (non-GAAP) for the third quarter of 2020 was $0.02 compared with adjusted loss per diluted share of $0.02 for the third quarter of 2019.
Earnings per diluted share (GAAP) for the nine months ended September 30, 2020 was $0.01 compared with loss per diluted share of $0.24 for the same period in 2019. Adjusted earnings per diluted share (non-GAAP) for the nine months ended September 30, 2020 was $0.03 compared with adjusted earnings per diluted share of $0.11 for the nine months ended September 30, 2019.
EBITDA

EBITDA, a non-GAAP measure, for the third quarter of 2020 was $41,000 compared with $10.7 million for the third quarter of 2019, while adjusted EBITDA for the third quarter of 2020 was $1.7 million compared with $926,000 for the third quarter of 2019.
EBITDA, a non-GAAP measure, for the nine months ended September 30, 2020 was $8.3 million compared with negative $4.2 million for the same period in 2019, while adjusted EBITDA for the nine months ended September 30, 2020 was $5.8 million compared with $4.3 million for the nine months ended September 30, 2019.
CASH

Cash, cash equivalents and restricted cash as of September 30, 2020 were $109.0 million compared with $6.4 million as of December 31, 2019. The increase reflects a $20 million common share purchase agreement with Casdin Capital LLC during the second quarter of 2020 and an $86 million capital raise in the third quarter of 2020.
Roderick de Greef, BioLife Chief Financial Officer and Chief Operating Officer, remarked, "We continue to execute well on our acquisition and integration strategy. Although we have seen a slightly negative impact on capital equipment product revenue due to COVID-19 restrictions on in-person sales meetings, our media business has consistently grown throughout 2020, increasing 25% for the first nine months of 2020 compared to the same period in 2019. We now have an even more robust offering with our acquisition of SciSafe, which closed on October 1, 2020."

2020 Financial Guidance

Due to uncertainty regarding the impact of the COVID-19 pandemic on BioLife and its customers, on May 1, 2020 the Company withdrew its financial guidance for 2020.

Conference Call & Webcast

Management will discuss the Company’s financial results and provide a general business update on a conference call and live webcast today at 4:30 p.m. ET (1:30 p.m. PT).

To access the webcast, log onto the Investor Relations page of the BioLife Solutions website at View Sourceearnings." target="_blank" title="View Sourceearnings." rel="nofollow">View Source Alternatively, you can access the live conference call by dialing (844) 825-0512 with Conference ID 1296883. A webcast replay will be available approximately two hours after the call ends and will be archived on View Source for 90 days.