Earnings call transcript: BioSyent Inc. sees 42% revenue surge in Q1 2025

BioSyent Inc. reported robust financial results for the first quarter of 2025, with a 42% year-over-year increase in revenue, reaching $11 million. The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) rose by 45%, translating to a 29% margin. The stock price edged up by 0.19% after the earnings announcement, closing at $10.75. According to InvestingPro, the company maintains an impressive "GREAT" financial health score of 3.59 out of 5, supported by strong profitability and cash flow metrics.

Key Takeaways

• BioSyent posted a 42% increase in Q1 2025 revenue.
• EBITDA margin improved to 29%.
• The company achieved its 59th consecutive profitable quarter.
• Canadian pharma business revenue increased by 21%.
• The stock price saw a slight increase post-earnings.

Company Performance

BioSyent Inc. demonstrated strong performance in Q1 2025, driven by significant revenue growth in both its Canadian and international pharmaceutical businesses. The company’s consistent profitability streak continues, marking its 59th consecutive profitable quarter. BioSyent’s strategic focus on expanding its product offerings and international presence contributed to its impressive financial results.

Financial Highlights

• Revenue: $11 million, up 42% year-over-year
• EBITDA: Increased by 45% with a 29% margin
• Net Income After Tax: $2.3 million, representing 21% of revenue
• Trailing Twelve Months EPS: 67¢, up from 62¢ in the previous period

Outlook & Guidance

BioSyent remains optimistic about its growth prospects for 2025. The company expects to exceed its 2024 revenue of $35 million, driven by its diversified revenue streams and upcoming product launches. A potential new endocrinology asset is pending Health Canada approval, which could further bolster the company’s portfolio. InvestingPro analysis reveals the company has maintained consistent dividend growth of 25% and holds more cash than debt on its balance sheet, positioning it well for future expansion. Eight additional ProTips are available to subscribers, offering deeper insights into BioSyent’s financial strength and growth potential.

Executive Commentary

CEO Rene Gorham emphasized BioSyent’s commitment to shareholder value, stating, "We want you to think of us as a capital compounder." He also highlighted the company’s expanding international sales footprint, saying, "We’re now in a zone where we expect sales to customers outside of Canada on a regular basis."

Risks and Challenges

• Regulatory approvals: Pending Health Canada approval for new products could delay market entry.
• Market competition: Increasing competition in the pharmaceutical sector may pressure margins.
• Currency fluctuations: International sales expose BioSyent to potential foreign exchange risks.
• Supply chain disruptions: Any disruptions could impact production and sales.
• Economic downturn: A global economic slowdown could affect consumer spending on healthcare products.

Full transcript - Biosyent Inc. (RX) Q1 2025:

Rene Gorham, President and CEO, BioScient, Inc.: Hello, and welcome to the BioScient, Inc. Q one twenty twenty five results presentation. My name is Rene Gorham, and I’m the president and CEO of the company. I wanna draw your attention to our forward looking statements disclaimer. I’m sure I will make some forward looking statements.

I wanna dive into the presentation by taking a look at our revenue, EBITDA, and net income after tax. So you can see, in the green bar, our revenue reached just under $11,000,000 for the first quarter, presenting a 42% increase versus the year ago, which was also a strong growth quarter for us. First quarter of twenty twenty five represented a record quarter overall for the company. We had strong EBITDA performance at plus 45% to the year ago and a 29% margin to revenue. And our net income after tax came in at just over $2,300,000 representing 21% of revenue as a ratio.

So let’s take a look, on a brand and unit basis. Overall, our Canadian pharma business was up 21% to the year ago, just under $9,200,000, broadly driven across the portfolio with a couple of exceptions. So you see here this is quarter versus quarter twenty five versus ’24 and the index. So strong growth across brands. The the notable exceptions, GelClare is still struggling to find its footing in the market in Canada.

It is our most recent product introduction. And Combogesic has really settled in as a pretty small part of our business overall, certainly smaller than first anticipated when we launched that product five years ago. The thing I’d like to point out here is in the comparable period, we had no sales for our international pharmaceutical business. Obviously, with over $1,500,000 in the quarter, know, with dramatic change, I will be talking a little bit about some of what’s behind that on the tibalia business that we made an acquisition on. We have been using the word lumpy to describe our international pharma business for years, and I would say that we’re now really less so.

I think this quarter and a year ago represented our only quarter of late where we did not have any international sales. So that profile has now changed, and I think we’re we’re now in in a zone where we expect sales to customers outside of Canada or our international pharma business on a regular basis. You see here as well strong performance for our legacy business. I wouldn’t read too much into that. It’s a good start to the year.

First quarter, it’s a relatively smaller part of our business, and I would not kind of put any big growth driver expectations on that. So overall, at $11,000,000, just under 11,000,000 in revenue company wide, the performance has been essentially kind of in the range of our expectations, maybe a little bit better than what we expected to have happen, but we were expecting 2025 to be a solid growth year. So it’s a good start to the year. So how did our revenue growth and and profitability translate to per share basis? You see here on a trailing twelve months ending March 31, what our profit is on a per share basis.

So 41¢ 2 years ago, 59¢ a year ago, and now we’ve jumped to 67¢ in the trailing twelve months. That’s notable because we reported our 2024 results just a few months ago for the period ending December 31, and the TTM EPS was 62¢. So a solid jump from 62 to 67 on the basis of a strong profitable start to the year. The first quarter of twenty twenty five represented our fifty ninth consecutive profitable quarter. We came profitable in the second quarter of twenty ten.

And since then, we’ve consistently built our business, grown revenue, and delivered profit for shareholders. So a quick look at some highlights on a YTD basis. I mentioned Tibeliya Global. So we made an acquisition which we had closed and announced last September. We’ve talked about that in a couple of presentations, so I won’t go through the detail.

But if you’re if you’re interested, if you’re new to the story, I invite you to take a look back to a September 20 announcement and then subsequent comments that are that we made in in subsequent reporting quarters. So last year’s results essentially had no revenue impact from that acquisition. We started shipping in January and February of this year. So in the quarter, we booked about 800,000 worth of new revenue, and we have filled our order book and production scheduling for the second, third, and fourth quarters of this year. And in fact, we are now filling our our order book and production scheduling for q one of twenty twenty six.

We paid a dividend in the first quarter in March of 5¢ that represented an 11% increase versus the prior year. And, we’ve just now announced a dividend of 5¢ to be paid in June. Last month, FerraMax was named the number one recommended oral iron supplement in Canada for the tenth consecutive year. So we’ve been building that brand now going back fifteen years. And starting ten years ago, we’ve been the number one recommended supplement amongst pharmacists and doctors across Canada.

This is an independent survey of health care professionals, and Fairmax is their number one recommendation to patients. We’re leveraging that trust that we’ve built over the last decade and a half, and I’ve got some more comments on the Fairmax business coming up. We continued with our NCIB. We’ve repurchased 19 and a half thousand You’ll see that that number appears quite a bit lower than run rate that we had had last year.

We we purchased just under 500,000 shares last year in 2024, but we, you know, intend to continue with NCIB. It may be at a slightly more modest pace, but we’ll we’ll continue to pick away at shares as we see them in the marketplace. So big theme over the last six months or so has been the impact of new arrangements and tariffs being made with trade. Maybe the arrangements are are those that are being made by the United States government. We spoke a little bit about this in March.

Not a lot has changed with respect to how it impacts our business. So I would say, you know, there continued uncertainty. Mostly, what we know is that we don’t know. We have been taking necessary steps in our business to mitigate the impacts or the potential impacts of tariffs. I guess the the key thing to know is that we don’t sell pharmaceutical products into The United States, so products and our customers are not subject to tariffs on the way into the market.

It’ll really be about where things settled out with tariffs and what The United States does and how Canada responds. I think this is fluid. I think everybody understands it’s fluid now. So we’re just staying on top of it and then making some some adjustments to the extent that we can to mitigate. So we see no short term impact on our business.

Would say nothing this year, fiscal twenty twenty five. I would say that we would continue to take the necessary steps to mitigate our p and l into 2026, and, hopefully, more will be known here in the coming months. I’ve spoken about Fairmax as number one. We’ve used this as a platform to innovate, and drive a life cycle strategy for Fairmax. So we reformulated the product and put that in market in, late twenty twenty.

And then over time, we’ve been essentially reformulating products that existed in the marketplace. We launched new Fairmax PD maintenance 45 in March of twenty twenty three. So we’re kinda two years into that launch, still considered a launch product in the parlance of how we we manage our business, and it certainly has been contributing overall to, the growth of the Feramax brand, which I reported earlier on an earlier slide. We do have additional development, that is underway and and are optimistic that we’ll have a 2026 product launch for the FerraMax brand. So we’ve had a a busy four and a half year period of time with innovations, product launches, and acquisitions.

Gonna start that with midyear twenty twenty, take you back in time. That is, in the heart of COVID. We we launched Tabella in Canada and have been steady at it, since then in terms of launching innovations and new product launches and making acquisitions. On this slide also, though, at the bottom, you, represented the the new Fairmax development that’s underway, and we’re optimistic about our ’26 launch. And we also in licensed the new endocrinology asset last year that we think has a significant peak penetration revenue value, so growth overall revenue growth potential for BioScience.

We’re still working on preparing that asset to submit to Health Canada for marketing authorization. So I touched on the fact that profitable in in 2010, so now fifteen years of consistent profitability while consistent and growing is really a better description. Now we had only two assets in market back in 2010 when we became profitable, the original Feramax and our legacy business. On the right hand side of the screen, you see all of the various brands and products that we have in market now, and that continues to evolve. What I wanna point out on the slide here is the bottom left corner of the fully diluted shares outstanding back in 2010 when we became profitable and the fully diluted shares outstanding on the bottom right hand side of your screen.

So during this period of time, we’ve built significant business. Last year, we did 35,000,000 in revenue. Clearly, with how we started this year, that number is going to grow in 2025, and, we fully expect that. That’s part of our plan. And we’ve done it by being good stewards of our shareholders’ capital and, respecting our cap table and ensuring that we’re not diluting our shareholders in the in the process.

So we do have a strong balance sheet. On March 31, we had just under $25,000,000 in cash. You see on this slide how that compares to a year ago and two years before that. So we’ve been in a range of about 25 to $28,000,000 in cash and near cash on the balance sheet. We have no debt.

That has not changed at all. So over this whole period of time, we’ve had no no debt on the balance sheet. You can see the the impact of, you know, growing growing revenue, growing profit, and then managing our cash position on the balance sheet has driven our return on equity from 15% in the twelve months ending March thirty first of twenty three up to 22% in this most recent reported twelve month period ending March 31. We generated $7,000,000 in cash from operations in the trailing twelve months. We returned 4,100,000.0 of that to shareholders in the form of share buybacks.

I mentioned that we had a fairly robust buyback program last year, a lot of activity. And, that was, you know, largely back end loaded. So in the last nine months of last year, and then, that includes, obviously, the first quarter of this year to come to the trailing twelve months. So 4,100,000.0. We pay dividends in aggregate in in those quarters of $2,100,000.

So $6,200,000 returned to shareholders, cash from operations of 7,000,000. Proportionately, it’s probably higher than one should expect as we look forward, the the dividend not, that we have every expectation that dividends continue and that over time, we are in a position to increase those dividends. I think NCIB is a proportion of our cash from operations. I would say one should not expect to see that significant a number. We we really are managing NCIB off of our our balance sheet, not so much off of our income statement.

So I do get asked, in this case now, it’s $25,000,000. What is your intention with the the cash position of the company? And we have been communicating this now for some time. But, in essence, the first use of capital is to generate a revenue and profit growth and then also to, deliver portfolio diversification. So to to continue to diversify the revenue streams that we have available to the business and to drive our revenue and profit growth.

We do, however, have a capital light business model. It’s a cash generating business. We are investing in growth. I I spoke about that on a couple of slides ago of all of the innovations and acquisitions that we’ve made over the last four and a half, five years. So that has continued and will continue.

That’s, you know, part of our strategy. In essence, we we want you to think of us as a capital compounder, and we’ll continue to do that. We’ll take excess capital that we don’t think is required to drive that strategy, and we will buy back shares and continue to pay a dividend. I like to end on this slide just to remind shareholders of how we’re managing incentive equity compensation. So you’ll see in the middle of the slide that we we mentioned RSU shares and trust.

We discontinued use of share options as a form of equity compensation over six years ago. So that’s the last time we issued any dilutive share options was in March of twenty nineteen. We pivoted to using RSUs as a form of equity compensation in the business. And what we do is we go into the market and we buy shares in the market and hold them in trust to satisfy our obligations under the RSU program. So quite an antidilutive approach to how we’re managing our cap table, and and that’s simply because we are shareholders as well, and we think managing a dilution is important for the business and in creating value on a per share basis.

We look forward to reporting on our continued evolution of the business, and we’ll next be reporting to you our Q2 results in August. Thank you.

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