Q4 2024 Inotiv Inc Earnings Call
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Speaker Change: Good day, everyone, and welcome to today's InnoTIV Fiscal 2024 Fourth Quarter Financial Results. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer session. You may register to ask a question at any time by pressing Star 1 on your telephone keypad.
Speaker Change: You may withdraw yourself from the queue by pressing star 2. Today's conference is being recorded. I will be standing by if you need any assistance. It is now my pleasure to turn the conference over to Stephen Halper.
Stephen Halper: Thank you, Marjorie, and good afternoon, everyone. Thank you for joining today's quarterly call with InnoTIV's management team. Before we begin, I'd like to remind everyone that some of the statements that management will make on this call are considered forward-looking statements.
including statements about the company's
Future Operating and Financial Results and Plans
Stephen Halper: Such statements are subjects to risks and uncertainties that could cause actual performance or achievements to be materially different from those projected. Any such statements represent management's expectations as of today's date.
Stephen Halper: You should not place undue reliance on these forward-looking statements, and the company does not undertake any obligation to update or revise forward-looking statements, whether as a result of new information, future events, or otherwise.
Stephen Halper: Please refer to the company's SEC filings for further guidance on this matter. Management will also discuss certain non-GAAP financial measures in an effort to provide additional information for investors.
Stephen Halper: Definition of these non-gap measures and reconciliations to the most comparable gap measures are included in the company's earnings release which has been posted to the investor section of the company's website www.innative.com and is also available in the form 8k filed with the Securities and Exchange Commission.
Stephen Halper: If you haven't obtained a copy of today's press release yet, you can do so by going to the investor's section of Innitus' website. Joining us from the company this afternoon are Bob Leisure, President and Chief Executive Officer and Beth Taylor, Chief Financial Officer.
Stephen Halper: John Sagart, Chief Strategy Officer, will join us for the question and answer portion of the call.
Speaker Change: Bob will begin with some opening remarks, after which Beth will present a summary of the company's financial results for our fiscal fourth quarter and full year ended September 30th, 2024. And then we'll open the call for your questions. It is now my pleasure to turn the call over to Bob Leasure, CEO. Bob, please go ahead.
Bob Leasure: Thank you, Steve, and good afternoon to everyone joining our call today. Fourth quarter was again productive for InnoDev. We accomplished many of our goals during the quarter and believe we are in good position going into 2025.
Bob Leasure: As you are aware, during 2024, we experienced volatility within our earnings and cash flow. Volatility was mainly related to challenges in our NHP business within the RMS business model, but we also saw continued conservative spending within the biotech industry.
Bob Leasure: The initiatives we've put in place over the last year were designed to reduce risk and address volatility, improve the customer experience, and draw new customers to the business.
Bob Leasure: All while enhancing our cash flow model in calendar 2025. I'd like to spend a few minutes on our fourth quarter 24 results and fiscal 24 highlights.
Bob Leasure: For the fiscal 2024 fourth quarter, total revenue was $130.4 million compared to $105.8 million in the third quarter of 2024, representing a 23% increase in quarter-over-quarter revenue.
Bob Leasure: So it was down 7.3% compared to the fourth quarter in fiscal 2023.
Bob Leasure: During the fourth quarter of 2024 in the RMS business, we continue to make progress improving our North American transportation and distribution systems.
Bob Leasure: We also completed the RMS site consolidation and facility improvements we announced almost two years ago as we completed the closure of our Blackthorn facility in the UK and the planned investments in our UK Hillcrest facility.
Bob Leasure: We saw a significant increase in HP's sold in Q4 compared to Q3 as we more than doubled the number sold in Q3.
Bob Leasure: During Q4, we sold much of our higher cost NHP inventory, which impacted margins in the quarter and will continue to impact margins in Q1 of fiscal 2025.
Bob Leasure: We also already have strong commitments for purchases from both existing and new customers for calendar 2025.
Bob Leasure: Within the RMS business, we also saw strong performances in the NHP Colony Management Services, the Diet, Bedding and Enrichment business line, as well as our European and UK RMS business lines.
Bob Leasure: DSA revenue and operating income decreased in Q4 2024 as compared to Q4 2023 due to safety assessment study mix and lower discovery service revenue.
Bob Leasure: However, DSA revenue and operating income were relatively consistent in Q4 2024 compared to Q3 2024.
Bob Leasure: From Q3 2024 to Q4 2024, we saw a continued trend of strong revenue for new services at a Rockville facility and a decrease in revenue related to Discovery Services.
Bob Leasure: On the operational side, we continued to drive efficiency, which allowed us to further reduce our general administrative expenses on a year-over-year basis.
Bob Leasure: While we made some incremental improvements to the balance sheet this quarter, we continue to evaluate opportunities to improve our balance sheet further and enhance our liquidity.
Bob Leasure: In Q4, we still saw some of the same trends experienced in previous quarters, which we monitor closely and continue to navigate through.
Bob Leasure: These include overall general business conditions in the biotech industry impacted and created price pressures in our business.
Bob Leasure: Although biotech funding in the market increased in the first nine months of the calendar 2024, we believe that the reduced biotech funding in the market during 2022 and 2023 and the increased cost of capital has continued to influence our clients' spending patterns for early stage research and development.
Bob Leasure: Now let me provide some comments on what we are seeing in the market today and some forward-looking thoughts on our different business segments.
Bob Leasure: We expect biopharma companies in the short term to continue to take a restrained, conservative approach to the preclinical pipeline products in order to prioritize the use of capital to their most important projects.
Bob Leasure: We will continue to capitalize on our innovation and scientific expertise to assist our clients in the improvement of speed of product development and achieve the appropriate economic returns.
Bob Leasure: We are emphasizing our efforts on growing our existing customer base through cross-selling our broad portfolio of products and services and attracting new customers to gain market share.
Bob Leasure: For the 12 months ended September 30, 2024, net new orders for DSA were ahead of the prior year's pace by approximately 5 percent.
Bob Leasure: We are pleased we've been able to accomplish this in spite of industry price pressure that we've seen in fiscal 2024 and an approximate 11 percent decline in revenue and 23 percent decline in orders in discovery business.
Bob Leasure: We have added new customers, and based on our pre-sales of NHPs and demand for colony management services, we are cautiously optimistic about increased NHP-related revenue in calendar 25.
Bob Leasure: We have expanded our NHP supply base and continue to work with our existing and newly qualified NHP suppliers in multiple countries.
Bob Leasure: Critically, we continue to audit them for animal welfare, health standards, and compliance-related matters and will not source from suppliers who do not or cannot meet those standards.
Bob Leasure: In the RMS non-HP business in 2025, we will initiate the next phase of our site optimization program to further improve and consolidate facilities in the U.S.
Bob Leasure: This next phase is another important program which is projected to eliminate another $4-5 million in operating expenses and further improve our RMS margins when completed.
Bob Leasure: Most of these financial improvements are not expected to be seen until fiscal 2026. We also believe we can achieve another $500 million in cost reductions from our continued integration of our North America transportation and distribution system.
Bob Leasure: We're confident going into 2025, but recognize there are geopolitical, market conditions, risk, and uncertainties.
Bob Leasure: In 2023 and 2024, we encourage several challenges as did some of our customers and others in our industry.
Bob Leasure: As a company, I'm proud of our people, our leadership, board, suppliers, customers, and lenders who work together to address these challenges, creating a stronger foundation for our business going into 2025.
Bob Leasure: As we overcome the challenges we've faced over the past two years, we believe our business is well positioned for the future.
Bob Leasure: We have continued to integrate our acquisitions, optimize our facilities, as we have also implemented several initiatives to mitigate these risks and related challenges.
Bob Leasure: We have lowered our cost, improved our service, and our responsiveness to our customers.
Bob Leasure: Yedid is well positioned as a mid-sized full-service CRO and provider of research models, diet, bedding, and enrichment products and services.
Bob Leasure: We remain committed to building a business that will create value for our customers, employees, and our shareholders, and look forward to 2025.
Speaker Change: With that, I'll turn the call over to Beth, who will provide a more detailed synopsis of INIT's results for the quarter and full year.
Beth Taylor: Thank you, Bob, and good afternoon, everyone. For the fiscal 2024 fourth quarter, total revenue was $130.4 million compared to $105.8 million in our third quarter 2024 and $140.7 million during the fiscal 2023 fourth quarter.
Beth Taylor: Compared to Q4 of 2023, we saw a decrease in total revenue of 7.3%, primarily due to an 11.2% decrease in DSA revenue and a 5.2% decrease in RMS revenue.
Beth Taylor: We actually saw a 177.9% increase in the number of NHP's
Beth Taylor: sold in Q4 2024 compared to Q3 2024, and a 48.9% increase in the number of NHP sold versus Q4 of 2023.
Beth Taylor: 2023 RMS revenue also included revenue of $1.7 million from our Israeli operation, which was sold in August of 2023.
Beth Taylor: For the 12 months ended September 30, 2024, consolidated revenue was $490.7 million, down 14.3%, compared to $572.4 million for fiscal 2023.
Beth Taylor: Mainly due to the decrease in NHP sold in Q2 and Q3 of fiscal 2024, as well as a decrease in NHP pricing in the sale of the Israeli businesses in August of 2023.
Beth Taylor: DSA revenue in the 2024 fourth quarter was $44.6 million compared to $44.2 million in Q3 of 2024 and $50.2 million in Q4 of 2023.
Beth Taylor: The decrease in the DSA revenue from prior year period was primarily driven by a decrease in general toxicology services due to a change in study mix and a decrease in discovery services revenue as a result of lower overall biotech activity in the market.
Beth Taylor: These impacts were partially offset by growth in the newer service lines at our Rockville, Maryland facility.
Beth Taylor: DSA revenue for the 12 months ended September 30, 2024 was $180.1 million
2.7% lower compared to prior year revenue of $185.1 million.
Beth Taylor: The decrease in DSA revenue was primarily driven by a $5 million decrease in Discovery Services revenue as a result of the decline in overall biotech activity in the market.
Beth Taylor: Overall, Net New DSA orders this quarter were $33.7 million versus $32 million in the same quarter last year.
Beth Taylor: For fiscal year ended September 30, 2024, we booked net new orders of $173 million versus $165.2 million for the 12 months ended September 30, 2023.
Beth Taylor: The conversion rate in the 2024 fourth quarter was 33%, slightly down from 34% in the prior year period.
Beth Taylor: The DSA cancellations and negative change orders in the 2024 fourth quarter were approximately 32% lower compared to the prior year period and in fiscal 2024 were approximately 16% less than in fiscal 2023.
Beth Taylor: RMS revenue for the fiscal fourth quarter increased $24.2 million, or 39.3%, compared to Q3 2024 and declined by 5.2%.
Beth Taylor: to $85.8 million compared to $90.5 million in the same fourth quarter of 2023.
Beth Taylor: The decrease in the fourth quarter, 2024, compared to the same quarter in 2023, was due to lower NHP-related product and service revenue, mainly as a result of pricing.
Beth Taylor: Additionally, in Q4 of fiscal 2024, there was a decrease in RMS revenue as a result of the sale of our Israeli businesses in Q4 fiscal 2023, with the remaining decrease primarily due to a decline in small animal model sales.
Beth Taylor: For the 12 months ended September 30, 2024, RMS revenue was down 19.8 percent.
to $310.6 million compared to $387.3 million in fiscal 2023.
Beth Taylor: The decrease was primarily due to the negative impact of lower volumes and lower pricing of NHP sales of $60.4 million and lower revenue as a result of the sale of our Israeli business in fiscal 2023 of $10.6 million.
Beth Taylor: partially offset by an increase in diet, bedding, and enrichment product sales and an increase in small animal sales and services outside the U.S.
Beth Taylor: Regarding NHP pricing, we indicated on our past conference calls that NHP prices were coming down from the highs we saw in Q4 of fiscal 2023 and the first two quarters in fiscal 2024.
Beth Taylor: As noted above, the average sales price of NHPs did increase slightly in Q4 of 2024 compared to Q3 of 2024.
Beth Taylor: As we sold higher cost NHPs that were purchased in late calendar 2023 and early calendar 2024, we saw lower margins in fiscal year 2024.
Beth Taylor: Now that we have worked through much of our higher cost NHP inventory, we believe our RMS margins in calendar 2025 should begin to improve.
Beth Taylor: Overall operating loss for the fourth quarter fiscal 2024 was $13.2 million and improved from operating loss in Q3 fiscal year 2024 of $20.8 million.
Beth Taylor: The operating loss in the 4th quarter of 2024 compared to operating income of $2.5 million from last year's
Beth Taylor: fourth quarter was primarily due to lower NHP margins on increased costs and reduced revenue and lower DSA margins on reduced revenue.
Beth Taylor: These items were partially offset by decreases from the impact of the sale of our Israeli businesses.
Beth Taylor: Decreases in restructuring costs, transportation costs, and costs related to sites closed in connection with our site optimization plan.
Beth Taylor: Operating income for our DSA segment in the fourth quarter was $1.9 million or 1.5% of total revenue, compared to $6.8 million or 4.8% of total revenue in last year's fourth quarter.
Beth Taylor: Operating income for our RMS segment in the fourth quarter was $1 million, or 0.8% of total revenue, compared to $11.8 million, or 8.4% of total revenue in last year's fourth quarter.
Beth Taylor: Consolidated net loss attributable to common shareholders in the fourth quarter of fiscal 2024 totaled $18.9 million or a $0.73 loss per diluted share.
Beth Taylor: For the fourth quarter, adjusted EBITDA was $5.4 million, or 4.1% of total revenue, compared to $23.7 million, or 16.8% of total revenue, for last fiscal year's fourth quarter.
Beth Taylor: For the 12 months ended September 30, 2024, adjusted EBITDA was $18.2 million, or 3.7% of total revenue compared to fiscal 2023 adjusted EBITDA of $65.8 million, or 11.5% of total revenue.
Beth Taylor: Consolidated net loss attributable to common shareholders for the 12 months ended September 30, 2024, totaled $108.4 million, or a $4.19 loss per diluted share.
Beth Taylor: This compared to consolidated net loss attributable to common shareholders of $105.1 million or $4.10 loss per diluted share for fiscal 2023.
Beth Taylor: Non-GAAP operating income for our DSA segment for the fourth quarter was $7.4 million or $5.5 million.
Beth Taylor: 6% of total revenue compared to $12.6 million or 9% of total revenue
Beth Taylor: in last year's fiscal year's fourth quarter. Non-GAAP operating income for our DSA segment for fiscal 2024 was $30.3 million, or 6.2% of total revenue, compared to $38.6 million, or 6.7% of total revenue, in fiscal 2023.
Beth Taylor: As our new DSA services come fully online and we begin to fill newly added capacity, we believe we will see margin improvement through operating leverage.
Beth Taylor: DSA backlog was $129.9 million at September 30, 2024 compared to $132.1 million at September 30, 2023.
Beth Taylor: In our RMS segment, Non-GAAP Operating Income in the Fourth Quarter of Fiscal 2024,
with $12.7 million or 9.7% of total revenue.
Beth Taylor: compared to $24 million or 17% of total revenue in last year's period.
Beth Taylor: In our RMS segment, non-GAAP operating income for fiscal 2024 was $44.3 million, or 9%, compared to $88.9 million, or 15.5%, for fiscal 2023.
Beth Taylor: Again, the NHP pricing and margins in the sale of our Israeli businesses in August of 2023 partially offset by favorable cost reductions related to restructuring costs accounted for most of these changes.
Beth Taylor: Interest expense in Q4 2024 increased to $12.3 million, up from $11.3 million in last year's
Beth Taylor: fiscal fourth quarter due to an increase in interest rates, additional second lien debt, and periodic drop on our revolving credit facility.
Beth Taylor: Our balance sheet as of September 30, 2024 included $21.4 million in cash and cash equivalents as compared to $35.5 million on September 30, 2023.
Beth Taylor: as of September 30, 2024 was $393.3 million compared to $377.7 million as of September 30, 2023.
Beth Taylor: This includes $110 million of convertible notes as of September 30, 2024, and our new second lien debt of $17.8 million.
Beth Taylor: Net cash used in operations for the 12 months ended September 30, 2024 was $6.8 million compared to cash provided by operations of $27.9 million in fiscal 2023. Cash used in operations during fiscal 2024 included $6.5 million paid under the resolution agreement with the DOJ.
Beth Taylor: In October 2024, we entered into a third amendment with the seller of OBRC and extended the no payable to January 27th of 2026.
Beth Taylor: The 7th Amendment to our Credit Agreement entered into on September 13, 2024, established a maximum capital expenditure limit and a minimum adjusted EBITDA test
Beth Taylor: Effective September 13, 2024, it waived the previously existing financial covenants from the date of the Seventh Amendment until June 30, 2025, and established additional new financial covenants for quarters starting June 30, 2025 and thereafter.
Beth Taylor: Capital expenditures in the fourth quarter were $5.3 million, or approximately 4.1% of total revenue.
Beth Taylor: For the 12 months ended September 30, 2024, capital expenditures were $22.3 million, or approximately 4.5%.
Beth Taylor: of Total Revenue as compared to $27.5 million, or 4.8% for the fiscal year 2023. The capital expenditures reflect investments in facility improvements.
Beth Taylor: finalizing the Hillcrest UK site expansion, enhancements to laboratory technology, improvements for animal welfare, and system enhancements to improve the client experience.
Beth Taylor: In terms of our capital improvements and site optimization plans, I am pleased to report that we have completed the investments and initiatives started mid-2020.
Beth Taylor: calendar year 2022. We expect to spend less to spend less than 4% of revenue for CapEx in fiscal 2025.
Beth Taylor: With respect to guidance, as you know, we withdrew our fiscal 2024 financial guidance after we reported fiscal Q2 2024 results.
Beth Taylor: While we feel good about the progress we made in the most recent quarter, we are not providing fiscal 2025 guidance at this juncture. We hope to provide guidance once we have greater clarity on the market and customer demand.
Beth Taylor: Management has developed a comprehensive fiscal 2025 annual operating plan designed to continue to optimize our capital allocation and expense base and improve our operating results as discussed above.
Beth Taylor: The plan forecasts compliance with the updated covenants under our latest amendment to the credit agreement in September 2024.
Speaker Change: And with that financial overview, we will turn the call over to our operator for questions.
Speaker Change: Thank you so much. At this time, if you would like to ask a question, please press the star 1 on your telephone keypads. You may remove yourself from the queue at any time by pressing star 2. And once again, that is star 1 to ask a question. While we wait for that queue to build, we'll take our first question from Frank Tankion from Lake Street Capital Markets. Please go ahead.
Frank Tankion: Alright, thanks for taking the questions, congrats on all the progress.
Frank Tankion: I was hoping to start with one clarifying question around gross margins, really around gross margins in NHPs. Anything you can do to help quantify exactly how much of a headwind it was that quarter? The reason I'm asking is it seems like there was really good sequential improvement in both volume and units, and I think that that gross margin is just lagging because of some of that higher dollar old inventory, but anything you can quantify in there to kind of give us a feel for what that gross margin may mature into once we get into a more normalized environment.
Speaker Change: I don't have a way to do that off the top of my head. Beth, if you have a way that you can...
Speaker Change: articulate those, but I'm guessing we were probably half, at least half of what we would normally achieve.
Beth, can you...
Can you see that?
Speaker Change: Yeah, yeah, if we look quarter over quarter, you know, this 24 fourth quarter to last year's, we were about half.
Of the margin percentage.
and it was it was important for us to
Speaker Change: To move that out, one, we needed to move the higher cost inventory, but two,
Speaker Change: From a space standpoint, we really needed to start bringing in additional lower cost inventory and we really needed to move that to make room. Our bottleneck is how much boarding capacity we have.
Speaker Change: So it was important that we could move that out. The market was there, demand was there, so we were able to move those out.
Speaker Change: Okay, got it. That was going to be kind of my second half. It feels like we're seeing that really stabilize. I mean, what can you say about 2025? Can you maybe speak to just how much of the business is now contracted? Any inventory commentary from your customers? Just any other commentary around that to kind of give us a feel for HPE's next year?
Speaker Change: The NHP business, we have definitely pre-sold more going into 2025 than we did going into 2024, and that includes multiple new customers.
Speaker Change: In addition, what we've really done a pretty good job with over the last couple years is growing our colony management services, and it's mainly boarding and services related around that. It's been growing, you know, about 20-25% a year, which is very good reoccurring revenue for us.
Speaker Change: So we've been expanding those boarding capabilities and services. So we expect that will continue to grow next year So I think for us
It's important that we see that a more consistent
Speaker Change: and don't forget to check out our website at www.thevenusproject.com. Thanks. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye.
You know, I think what we sold last quarter
Speaker Change: It should be more of a reoccurring quarter going forward. I think we will still have some depressed margins in our fiscal Q1, the quarter we're in today.
Speaker Change: But after that I think we'll be a much more normalized base, much like we probably saw in 22 and early 23.
Speaker Change: Okay, that's helpful. And then maybe just for my last one, a bigger picture question, I know in the past...
Speaker Change: You've talked to adjusted EBITDA margins maturing over a longer period of time into the 18% to 22% range. In light of all the site optimizations you've done, the contracted NHP business, do you feel that that 18 to 22 target is still a reasonable, we'll call it midterm target over time for the business to mature into?
Speaker Change: I do. I think to get to the higher end of that...
Speaker Change: We'd have to see some recovery in the industry because there's some pricing pressure right now and some volume issues because, I think, of the overall demand.
Speaker Change: and small animals in some of those areas. But if you look at where we're gonna see our improvements next year, because of some of the site optimization things that we did, what we're seeing in our diet enrichment business, what we're seeing in UK and Europe, what costs we're able to take out in transportation in the US.
Speaker Change: combined within our improvements in the NHP business and then what we're seeing in our DSA business currently and I do expect we'll probably see some recovery in the in the DSA business next year one from a new services and from some of the other things that we've been able to grow so
Perfect. That's helpful. I'll stop there. Thank you.
Speaker Change: Thank you. Our next question comes from Matt Hewitt from Craig Hallam. Please go ahead.
Matt Hewitt: Good afternoon, thank you for taking the questions. Maybe first up, and I appreciate that you're not providing guidance, but is it safe to assume that we should anticipate growth in 2025 off of 2024, kind of a low watermark?
Speaker Change: Yes, yes, I think just on the NHPs we'll see some growth. I think we'll also see it in diet, bedding, and enrichment. We'll see continued growth, I believe, right now in the U.S. and in, say, U.K. and Europe.
Speaker Change: So those and and it wouldn't surprise me completely that we that we see growth next year in in the discovery I think I believe that we're hopefully seeing the bottom of that and starting to see some maybe some recovery
Speaker Change: So I think we will see growth in all those areas. I don't think we'll see a lot of growth in pricing. I think it'll be mainly in the NHP business. I think it'll come mainly from volume.
Speaker Change: Got it. That's helpful. Thank you. And then I just want to maybe touch on the price. It's come up a couple times. Obviously, you're seeing some price competition. Are you being forced to match to retain or even pick up some incremental share? Or are you able to, you know, kind of highlight your white glove treatment of customers and so you're not having to perfectly match? You can maybe have to come down a little bit, but you're still able to retain or pick up incremental share because of the the treatment and your strong customer relationships.
Speaker Change: Well, I think pricing is coming down for a couple of reasons. One, pricing is coming down because the NHP prices have come down.
Speaker Change: And so people's costs have come down. And second of all, I think there's been some margin compression also. So I think in general, there's been some pricing. That's mainly in the DSA business, more so than the other businesses. But I think the NHP business also drove some of that pricing down.
Speaker Change: Got it. Okay, maybe one last one for me and I'll hop back into the queue, but I just want to mesh a couple comments. So I think earlier in your prepared comments
Speaker Change: Is that, you know, kind of, as you were just alluding to, Bob, maybe first quarter you've got some of that higher cost inventory that you have to kind of get through. Once you're through that, you should start to see some lifting gross margins over the remainder of the year. Am I hearing that correctly?
Bob Leasure: Yes, Matt, I think what we're saying is that we think that there'll be some margin pressure in this quarter, but what we saw and what we will see in calendar 2025 should be much stronger.
Bob Leasure: I think it was a calendar versus a fiscal issue, but we're fairly optimistic going into calendar 25, but we want to make sure that what we have left we kind of clear out in this quarter.
Got it. All right. Thank you.
Speaker Change: Thank you and with no further questions I'd like to turn the call back over to Mr. Bob Leasure for any closing remarks.
Bob Leasure: All right, well thank you everyone for joining today's call. I think our site optimization, integration, ability to reduce our third-party expenses and pre-sales of NHPs have put us in a much better position going into our fiscal 2025.
Bob Leasure: In 2025, we'll continue to build into this a high-touch, flexible provider with strong scientific capabilities, focused on our customer needs. We'll continue to pay attention to the details.
Bob Leasure: Our metrics related to customer service quality and delivery are continuing to improve and we continue to get better every day We're still a young company in our industry and we believe our best days are ahead. Thank you for your time today
Speaker Change: Thank you. And ladies and gentlemen, that does conclude today's program. Thank you for your participation. You may disconnect at any time.