Bioharvest Sciences, Inc. ((BHST)) has held its Q4 earnings call. Read on for the main highlights of the call.
The recent earnings call for BioHarvest Sciences, Inc. was marked by a generally positive sentiment, highlighting substantial revenue growth and improved gross margins. The company has successfully expanded its direct-to-consumer and CDMO businesses, although it continues to face challenges with net losses and a reduced cash position, partially offset by recent debt financing.
Strong Revenue Growth
BioHarvest Sciences reported an impressive 99% year-over-year revenue growth, achieving $25.2 million for the full year of 2024. The fourth quarter alone saw a 62% increase in revenue year-over-year, reaching $7.3 million. This growth underscores the company’s robust market presence and successful business strategies.
Increase in Gross Margins
The company achieved a significant improvement in gross margins, which increased by 600 basis points to 57% in the fourth quarter of 2024. Over the year, gross margins improved by 1,000 basis points, rising from 45% in 2023 to 55% in 2024, indicating enhanced operational efficiency.
Subscription and Product Diversification Success
BioHarvest’s flagship product, VINIA, boasts over 50,000 active subscribers, with a substantial 90% of Vinia.com revenue coming from subscriptions. The product line has been diversified to include superfood coffees and teas, broadening the company’s market reach.
Operating Leverage and Cost Management
Despite doubling its revenue base, BioHarvest successfully managed its costs, with general and administrative expenses decreasing by 1.8% year-over-year. Operating expenses also decreased to 80% of revenue in Q4 2024, down from 107% a year ago, reflecting improved cost management.
CDMO Business Expansion
The company’s CDMO business is expanding, with multiple customer signings, including a notable partnership with Tate & Lyle to develop next-generation plant-based sweeteners. Several deals are in the pipeline, promising further growth in this sector.
Net Losses
BioHarvest reported net losses of $3 million for the fourth quarter of 2024, or $0.17 per basic and diluted share. This is an improvement from the net loss of $7.2 million, or $0.53 per share, in the same quarter of the previous year, indicating a positive trend towards financial stability.
Cash Position
As of December 31, 2024, the company’s cash and cash equivalents totaled $2.4 million, down from $5.4 million a year earlier. However, subsequent to the quarter’s end, BioHarvest raised $3.9 million in debt financing, providing a buffer for future operations.
Forward-Looking Guidance
Looking ahead, BioHarvest Sciences aims to achieve adjusted EBITDA profitability at approximately $11 million to $12 million in quarterly revenue, anticipated in the second half of 2025. The company plans to leverage its successful VINIA product line and expand into new product categories like superfood coffee and tea. Additionally, strategic partnerships in the CDMO division, such as with Tate & Lyle, are expected to drive future growth.
In summary, BioHarvest Sciences, Inc. has demonstrated strong financial performance with significant revenue growth and improved margins. While challenges remain, particularly with net losses and cash reserves, the company’s strategic initiatives and forward-looking guidance suggest a promising outlook for future profitability and expansion.