Categories: News

Champions Oncology Reports Record Quarterly Revenue of $10.1 Million

Launches Lumin Bioinformatics SaaS platform

HACKENSACK, NJ / ACCESSWIRE / December 14, 2020 / Champions Oncology, Inc. (NASDAQ:CSBR), a leading global oncology technology solutions provider engaged in transforming drug discovery through innovative pharmacology, biomarker and data platforms, today announced its financial results for the second fiscal quarter ended October 31, 2020.

Second Quarter and Recent Highlights:

  • Launched our Lumin Bioinformatics proprietary SaaS platform
  • Delivered record quarterly revenue of $10.1 million, an increase of 33% year-over-year
  • Reported income from operations, excluding stock-based compensation, depreciation and amortization, of $400,000
  • Raising our full-year revenue guidance to 20%-25%

Ronnie Morris, CEO of Champions, commented, “This quarter was highlighted by a significant milestone for Champions as we unveiled Lumin Bioinformatics, our proprietary SaaS program that provides customers with tools to interrogate our vast database and perform computational research in an effort to identify new targets in their drug discovery and development programs. Through both internal and public datasets, we have built tools and visualizations that provide a powerful mechanism for cancer biologists to leverage computational analytics in discovery and development programs.”

David Miller, CFO of Champions added, “We reached another quarterly revenue record, exceeding $10 million for the first time equating to a 33% year over year revenue increase. The success of our recent product launches has led to continued bookings growth, positioning Champions to deliver further revenue milestones in the coming quarters. Accordingly, we are raising our full-year revenue guidance to 20%-25%. In addition, the launch of our Lumin platform represents another product rollout that Champions expects to become a meaningful contributor to the continued expansion of the Company over the coming years.”

Second Fiscal Quarter Financial Results

For the second quarter of fiscal 2021, revenue increased 32.7% to $10.1 million compared to $7.6 million for the second quarter of fiscal 2020. The increase in revenue was due to a continued increase in sales, both in number and size of studies, and the expansion of both our platform and product lines. Our contract amounts have increased as we perform more complex studies and end point analysis testing. Total costs and operating expenses for the second quarter of fiscal 2021 were $10.1 million compared to $7.3 million for the second quarter of fiscal 2020, an increase of $2.8 million or 37.9%.

For the second quarter of fiscal 2021, Champions reported income from operations of $7,000, including $85,000 in stock-based compensation and $307,000 in depreciation and amortization expenses, a decrease of $284,000 compared to the income from operations of $291,000, inclusive of $77,000 in stock-based compensation and $178,000 in depreciation and amortization expenses, in the second quarter of fiscal 2020. Excluding stock-based compensation, depreciation and amortization expenses, Champions reported non-GAAP income from operations of $401,000 for the second quarter of fiscal 2021 compared to non-GAAP income from operations of $546,000 in the second quarter of fiscal 2020, a decrease of $144,000.

Cost of oncology solutions was $5.6 million for the three-months ended October 31, 2020, an increase of $1.8 million, or 45.4% compared to $3.9 million for the three-months ended October 31, 2019. For the three- months ended October 31, 2020, gross margin was 44.2% compared to 49.1% for the three-months ended October 31, 2019. The increase in cost of oncology services for the three-month period was mainly due to an increase in compensation, lab supply, and outsourced lab service expenses. Outsourced lab services accounted for $1.4 million of the total increase. Excluding outsourced lab services, the overall expense increase in cost of sales is generally in line with the expected contribution based on the growth in revenue, study volume, and expansion into new services. Gross margin varies based on timing differences between expense and revenue recognition and was driven lower by the increase in costs on growing study volume in advance of revenue recognition. The cost of outsourced lab services amplified this impact.

Research and development expense for the three-months ended October 31, 2020 was $1.7 million, an increase of $308,000 or 23.0%, compared to $1.3 million for the three-months ended October 31, 2019, respectively. The increase was due to increased compensation and lab supply expense as we continued to develop new service capabilities and endpoint analysis testing. Additionally, we incurred sequencing costs as our investment in characterizing our TumorBank continued, adding valuable data to our platform. Sales and marketing expense for the three-months ended October 31, 2020 was $1.3 million, an increase of $371,000, or 38.0%, compared to $977,000 for the three-months ended October 31, 2019. The increase was primarily due to compensation expense driven by the continued investment in expanding our business development team. General and administrative expense for the three-months ended October 31, 2020 was $1.5 million, an increase of $333,000, or 29.3%, compared to $1.1 million for the three-months ended October 31, 2019, respectively. General and administrative expenses are primarily comprised of compensation, insurance, accounting fees, and depreciation expenses and have increased to support the overall infrastructure growth of the company.

Net cash generated from operating activities was $880,000 for the three-months ended October 31, 2020 compared to $360,000 for the same period last year. The increase in cash flow from operations is primarily due to the improvement in financial operating results.

The Company ended the quarter in a strong cash position with a $8.6 million cash balance compared to $2.8 million at the end of the same period last year. The Company has no debt.

Year-to-Date Financial Results

For the first six months of fiscal 2021, revenue increased 36.9% to $19.7 million, as compared to $14.4 million for the first six months of fiscal 2020. For the first six months of fiscal 2021, total operating expenses increased 33.7% to $19.6 million, as compared to $14.7 million for the first six months of fiscal 2020. The increase in revenue was due to increased sales, both in number and size of studies, an increase in demand for our services, the growth of the platform, and the expansion of our product line. Our customers are seeking more complex study designs and end point analysis testing, contributing to the larger contract sizes.

For the first six months of fiscal 2021, Champions reported income from operations of $31,000, which includes $205,000 in stock-based compensation and $584,000 in depreciation and amortization expenses, an increase of $357,000 or 109.6%, compared to a loss from operations of $323,000, inclusive of $208,000 in stock-based compensation and $360,000 depreciation, for the first six months of fiscal 2020. Excluding stock-based compensation and depreciation, Champions reported operating income of $822,000 for the first six months of fiscal 2021 compared to income of $244,000 in the same period last year.

Cost of oncology solutions was $11.0 million for the first six months of fiscal 2021 compared to $7.6 million for the first six months of fiscal 2020, an increase of $3.3 million or 43.8%. Gross margin was 44.2% for the first six months of fiscal 2021 compared to 46.9% for the first six months of fiscal 2020. The increase in cost of oncology services for the six-month period was mainly due to an increase in compensation, lab supply and outsourced lab service expenses. Excluding outsourced lab services, the overall expense increase is generally in line with the expected contribution based on the growth in revenue, study volume, and expansion into new services. Gross margin varies based on timing differences between expense and revenue recognition and was driven lower by the increase in costs on growing study volume in advance of revenue recognition. The cost of outsourced lab services amplified this impact.

Research and development expense was $3.2 million for the first six months of fiscal 2021 an increase of $603,000, or 22.8% compared to $2.6 million for the first six months of fiscal 2020. The increase was due to increased compensation and lab supply expense as we continued to develop new service capabilities and endpoint testing analysis, and incurred sequencing costs as we continued to characterize our TumorBank. Sales and marketing expense for the first six months of fiscal 2021 was $2.6 million, an increase of $709,000, or 38.4% compared to $1.8 million for the first six months of fiscal 2020. The increase was primarily due to compensation expense driven by the continued investment in expanding our sales force. General and administrative expense was $2.9 million for the first six months of fiscal 2021 , an increase of $289,000, or 11.3% compared to $2.6 million for the first six months of fiscal 2020. General and administrative expenses are primarily comprised of compensation, insurance, accounting fees, and depreciation expenses and have increased to support the overall infrastructure growth of the company.

Net cash provided by operations was $164,000 for the first six months of fiscal 2021 compared to net provided by operations of $81,000 in fiscal 2020, an increase of $45,000 or 55.6%.

Conference Call Information:

The Company will host a conference call today at 4:30 p.m. EST (1:30 p.m. PST) to discuss its third quarter financial results. To participate in the call, please call 877-407-8035 (domestic) or 201-689-8035 (international) ten minutes ahead of the call and give the verbal reference “Champions Oncology.”

Full details of the Company’s financial results will be available Tuesday, December 15, 2020 in the Company’s Form 10-Q at www.championsoncology.com.

* Non-GAAP Financial Information

See the attached Reconciliation of GAAP net income (loss) to Non-GAAP net income (loss) for an explanation of the amounts excluded to arrive at Non-GAAP net income (loss) and related Non-GAAP earnings (loss) per share amounts for the three months ended October 31, 2020 and 2019. Non-GAAP financial measures provide investors and management with supplemental measures of operating performance and trends that facilitate comparisons between periods before and after certain items that would not otherwise be apparent on a GAAP basis. Certain unusual or non-recurring items that management does not believe affect the Company’s basic operations do not meet the GAAP definition of unusual or non-recurring items. Non-GAAP net income (loss) and Non-GAAP earnings (loss) per share are not, and should not, be viewed as a substitute for similar GAAP items. Champions defines Non-GAAP dilutive earnings (loss) per share amounts as Non-GAAP net earnings (loss) divided by the weighted average number of diluted shares outstanding. Champions’ definition of Non-GAAP net earnings (loss) and Non-GAAP diluted earnings (loss) per share may differ from similarly named measures used by other companies.

About Champions Oncology, Inc.

Champions Oncology is a technology-driven research organization that provides transformative end-to-end research and development solutions, ranging from in vitro cell line assessments, modeling treatment in the clinic using highly predictive patient-derived xenograft (PDX) models, as well as assessing clinical patient samples with sophisticated biomarker platforms. Champions Oncology is actively engaged in the development of advanced technology solutions and services to accelerate the development of oncology therapeutics. For more information, please visit www.ChampionsOncology.com.

This press release may contain “forward-looking statements” (within the meaning of the Private Securities Litigation Act of 1995) that inherently involve risk and uncertainties. Champions Oncology generally uses words such as “believe,” “may,” “could,” “will,” “intend,” “expect,” “anticipate,” “plan,” and similar expressions to identify forward-looking statements. One should not place undue reliance on these forward-looking statements. The Company’s actual results could differ materially from those anticipated in the forward-looking statements for many unforeseen factors. See Champions Oncology’s Form 10-K for the fiscal year ended April 30, 2020 for a discussion of such risks, uncertainties and other factors. Although the Company believes the expectations reflected in the forward-looking statements are reasonable, they relate only to events as of the date on which the statements are made, and Champions Oncology’s future results, levels of activity, performance or achievements may not meet these expectations. The Company does not intend to update any of the forward-looking statements after the date of this press release to conform these statements to actual results or to changes in Champions Oncology’s expectations, except as required by law.

Champions Oncology, Inc.
(Dollars in thousands)

Reconciliation of GAAP to Non-GAAP Net Income (Loss) (Unaudited)

 

Three Months Ended
October 31,

 

Six Months Ended
October 31,

 

2020

 

2019

 

2020

 

2019

Net income (loss) – GAAP

$

1

   

$

307

   

$

76

   

$

(334)

 

Less:

             

Stock-based compensation

85

   

77

   

205

   

208

 

Net income (loss)- Non-GAAP

$

86

   

$

384

   

$

281

   

$

(126)

 

Reconciliation of GAAP EPS to Non-GAAP EPS (Unaudited)

 

Three Months Ended
October 31,

 

Six Months Ended
October 31,

 

2020

 

2019

 

2020

 

2019

EPS – GAAP, basic

$

   

$

0.03

   

$

0.01

   

$

(0.03)

 

Less:

             

Effect of stock-based compensation on EPS

0.01

   

0.01

   

0.02

   

0.02

 

EPS – Non-GAAP, basic

$

0.01

   

$

0.04

   

$

0.03

   

$

(0.01)

 
                               
               
 

Three Months Ended
October 31,

 

Six Months Ended
October 31,

 

2020

 

2019

 

2020

 

2019

EPS – GAAP, diluted

$

   

$

0.02

   

$

0.01

   

$

(0.03)

 

Less:

             

Effect of stock-based compensation on EPS

0.01

   

0.01

   

0.01

   

0.02

 

EPS – Non-GAAP, diluted

$

0.01

   

$

0.03

   

$

0.02

   

$

(0.01)

 
                               

Unaudited Condensed Consolidated Statements of Operations

 

Three Months Ended
October 31,

 

Six Months Ended
October 31,

 

2020

 

2019

 

2020

 

2019

Oncology services revenue

$

10,117

   

$

7,625

   

$

19,664

   

$

14,362

 

Cost of oncology services

5,644

   

3,881

   

10,980

   

7,633

 

Research and development

1,650

   

1,341

   

3,247

   

2,644

 

Sales and marketing

1,348

   

977

   

2,556

   

1,847

 

General and administrative

1,468

   

1,135

   

2,850

   

2,561

 

Income (loss) from operations

7

   

291

   

31

   

(323)

 

Other income

9

   

27

   

73

   

15

 

Income (loss) before provision for income taxes

16

   

318

   

104

   

(308)

 

Provision for income taxes

15

   

11

   

28

   

26

 

Net income (loss)

$

1

   

$

307

   

$

76

   

$

(334)

 
               

Net income (loss) per common share outstanding

             

basic

$

   

$

0.03

   

$

0.01

   

$

(0.03)

 

and diluted

$

   

$

0.02

   

$

0.01

   

$

(0.03)

 
               

Weighted average common shares outstanding

             

basic

13,064,191

   

11,619,686

   

12,811,921

   

11,619,569

 

and diluted

15,062,103

   

12,964,792

   

14,563,060

   

11,619,569

 
                       

Condensed Consolidated Balance Sheets

 

October 31, 2020

 

April 30, 2020

 

(unaudited)

   

Cash

$

8,553

   

$

8,342

 

Accounts receivable

5,960

   

4,770

 

Other current assets

477

   

385

 

Total current assets

14,990

   

13,497

 
       

Operating lease right-of-use assets, net

5,527

   

2,798

 

Property and equipment, net

4,872

   

3,993

 

Other long term assets

36

   

128

 

Goodwill

335

   

335

 

Total assets

$

25,760

   

$

20,751

 
       

Accounts payable and accrued liabilities

$

5,943

   

$

5,642

 

Current portion of finance lease

18

   

125

 

Current portion of operating lease liabilities

605

   

503

 

Deferred revenue

6,188

   

5,815

 

Total current liabilities

12,754

   

12,085

 
       

Non-current operating lease liabilities

5,932

   

3,170

 

Other Non-current Liability

181

   

178

 

Total liabilities

18,867

   

15,433

 
       

Stockholders’ equity

6,893

   

5,318

 

Total liabilities and stockholders’ equity

$

25,760

   

$

20,751

 
               

Unaudited Condensed Consolidated Statements of Cash Flows

 

Six Months Ended
October 31,

 

2020

 

2019

Cash flows from operating activities:

     

Net income (loss)

$

76

   

$

(334)

 

Adjustments to reconcile net cash provided by operations:

     

Stock-based compensation expense

205

   

208

 

Operating lease right-of use assets

79

   

198

 

Depreciation and amortization expense

584

   

360

 

Gain on termination of operating lease

(75)

   

 

Gain on disposal of equipment

   

(52)

 

Allowance for doubtful accounts

49

   

34

 

Changes in operating assets and liabilities

(754)

   

(333)

 

Net cash provided by operating activities

164

   

81

 
       

Cash flows from investing activities:

     

Purchases of property and equipment

(1,224)

   

(522)

 

Refund of security deposit

92

   

 

Net cash used in investing activities:

(1,132)

   

(522)

 
       

Cash flows from financing activities:

     

Proceeds from the exercise of stock options

1,294

   

2

 

Finance lease payments

(115)

   

(14)

 

Net cash provided by (used in) financing activities:

1,179

   

(12)

 
       

Net increase (decrease) in cash

211

   

(453)

 

Cash at beginning of period

8,342

   

3,237

 

Cash at the end of period

$

8,553

   

$

2,784

 
       

Non-cash investing activities:

     

Right-of-use assets obtained in exchange for operating lease liabilities

3,872

   

3,205

 

Credit received on purchase of equipment

$

   

$

160

 

Unpaid portion of property and equipment purchase

$

240

   

$

321

 

SOURCE: Champions Oncology, Inc.

View source version on accesswire.com:
https://www.accesswire.com/620812/Champions-Oncology-Reports-Record-Quarterly-Revenue-of-101-Million

Staff

Recent Posts

Methodist Le Bonheur Healthcare named among Best in Cancer Care by Money magazine

MEMPHIS, Tenn., July 5, 2024 /PRNewswire/ -- Methodist Le Bonheur Healthcare announced its four Memphis-based adult hospitals…

2 days ago

Hospital PMI® at 55.8%; June 2024 Hospital ISM® Report On Business®

TEMPE, Ariz., July 5, 2024 /PRNewswire/ -- Economic activity in the hospital subsector grew in June…

2 days ago

KORE Helps mCare Digital Launch the Next Generation of Personal Emergency Technology

mCare Digital unveils the mCareWatch MW-241 powered by KORE connectivity ATLANTA, July 5, 2024 /PRNewswire/…

2 days ago

Cosmo Shareholders Approved All Resolutions Proposed by the Board of Directors at Extraordinary General Meeting

Shareholders approved a dividend distribution of € 2.00 per ordinary share; representing an increase of…

2 days ago

Hitachi’s Holography Electron Microscope Attains Unprecedented Resolution

Image acquisition and defocusing correction techniques enable observations of atomic-scale magnetic fields at never-before-seen resolution…

2 days ago

Phio Pharmaceuticals Terminates Share Purchase Agreement with Triton Funds

Marlborough, Massachusetts--(Newsfile Corp. - July 5, 2024) - Phio Pharmaceuticals Corp. (NASDAQ: PHIO), a clinical…

2 days ago