Q1 2025 ImmuCell Corp Earnings Call
Good morning, and welcome to the image. So Corporation reports first quarter ended March 31st 2025 odd <unk> financial results Conference call.
Operator: Good morning and welcome to the ImmuCell Corporation Report's first quarter ended March 31st, 2025 audited financial results conference call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded.
All participants will be in listen only mode.
After todays presentation, there will be an opportunity to ask questions. Please note. This event is being recorded.
Speaker Change: I would now like to turn the conference call over to Joe Diaz of Lytham Partners. Please go ahead.
Joe Diaz: I would now like to turn the conference call over to Joe Diaz of Lytton Partners. Please go ahead. Thank you, Vicki. Good morning and welcome to all. As the operator indicated, my name is Joe Diaz. Welcome part We are the investor relations consulting firm for ImmuCell. I thank all of you for joining us today to discuss the unaudited financial results for the first quarter ended March 31, 2025.
Joe Diaz: Thank you Vicky and good morning, and welcome to all.
Speaker Change: As the operator indicated my name is Joe Diaz.
Speaker Change: We are the Investor relations consulting firm for them yourself.
Speaker Change: Thank all of you for joining us today to discuss the unaudited financial results for the first quarter ended March 31 2025.
Joe Diaz: Listeners are reminded and cautioned that statements made by management during the course of this call include forward looking statements, which include any statement that refers to future events, or expected future results, or predictions about steps that company plans to take in the future. These statements are not guarantees of performance, and are subject to risks and uncertainties that could cause actual results, outcomes, or events to differ materially from those discussed today.
Speaker Change: <unk> are reminded caution.
Speaker Change: Statements made by management during the course of this call include forward looking statements, which include any statements that refer to future events or expected future results or predictions about the steps the company plans to take in the future.
Speaker Change: <unk> are not guarantees of performance and are subject to risks and uncertainties that could cause actual result outcomes or events to differ materially from those discussed today.
Joe Diaz: Additional information regarding forward-looking statements and the risks and uncertainties that could impact future results, outcomes, or events is available under the Cautionary Note regarding forward-looking statements or the Safe Harbor Statement provided with Form 10-Q and the press release the company filed last night, along with the company's other periodic filings with the SEC. Information discussed on today's call speaks only as of today, Thursday, May 15, 2025. company undertakes no obligation to update any information discussed on today's call.
Additional information regarding forward looking statements and the risks and uncertainties that could impact future results outcomes or events is available under the cautionary note regarding forward looking statements or the safe Harbor statement provided with Form 10-Q, and the press release the company filed.
Speaker Change: Last night, along with the company's other periodic filings with the SEC.
Speaker Change: Information discussed on today's call speaks only as of today Thursday May 15 2025.
Speaker Change: Company undertakes no obligation to update any information discussed on today's call.
Joe Diaz: Please note that that references to certain non-GAAP financial measures may be made during today's call. The company included definitions of these terms, as well as reconciliations of these figures to the most comparable GAAP financial measures in last night's press release in order to better assist you in understanding its financial performance.
Speaker Change: Please note.
Speaker Change: References to certain non-GAAP financial measures may be made during today's call the company and coated definitions of these terms as well as reconciliations of these figures to the most comparable GAAP financial measures and last nights press release in order to better assist you in understanding its.
Speaker Change: Financial performance.
Michael Brigham: With that said, let me turn the call over to Michael Brigham, President and CEO of ImmuCell Corporation for opening remarks. We will then hear from Tim Fiore, the company's newly appointed CFO, with a review of some first quarter financial highlights, after which we will open the call for your questions. Thanks, Joe. And good morning, everyone.
Speaker Change: With that said, let me turn the call over to Michael Brigham President and CEO of maybe sell corporation for opening remarks, we will then hear from Tim Fiori, the companys newly appointed CFO with a review of first quarter financial highlights after which we will open the call for your questions.
Speaker Change: Michael.
Speaker Change: Thanks, Joe and good morning, everyone.
Michael Brigham: As Joe said, in a moment, I'd like to introduce you all to our new CFO, Tim Fiori. First, I would like to offer a few comments from a high level strategic perspective. Quite simply, our business is becoming larger, more diverse, and more complex. And that's a great thing. We are very focused on the commercial opportunity that we have with First Defense. The recent growth in First Defense sales is very positive for us. Our investments to increase production capacity above 30 million per year are now complete. Expanding our production facilities and implementing the new equipment was a huge project.
Speaker Change: As Joe said in a moment I would like to introduce you all to our new CFO, Tim Fiori first I would like to offer a few comments from a high level strategic perspective quite.
Speaker Change: Quite simply our business is becoming larger more diverse and more complex.
Speaker Change: And that's a great thing.
Speaker Change: Very focused on the commercial opportunity that we have with first defense.
Speaker Change: Recent growth in first defense sales is very positive for us our investments to increase production capacity above $30 million per year now complete expanding our production facilities and implementing the new equipment was a huge project, we implemented important process improvements and worked through certain contamination.
Michael Brigham: We implemented important process improvements and worked through certain contamination events. It is important to note that we have not incurred another contamination event for over a year now. During the just completed quarter, we achieved gross margin expansion along with the revenue growth, and we increased our cash balance to about $4.6 million as of March 31, 2025. Moreover, we are pleased to see traction for the different product formats we introduced for First Offense, to the point where these now should be seen as a suite of related products with expanded uses and appeal. At the same time, we're initiating investigational product use of Retain to collect market feedback about product performance in the field while reducing product development expenses and exploring potential strategic options for our novel technology.
Speaker Change: Events. It is important to note that we have not incurred another contamination event for over a year now.
Speaker Change: During the just completed quarter, we achieved gross margin expansion along with the revenue growth and we increased our cash balance to about $4 6 million as of March 31 2025.
Speaker Change: Moreover, we are pleased to see traction for the different product formats. We introduced for first defense to the point, where these now it should be seen as a suite of related products with expanded uses an appeal at the same time, we are initiating investigational product use of retain to collect market feedback about product.
Speaker Change: Performance in the field, while reducing product development expenses and exploring potential strategic options for our novel technology.
Michael Brigham: Our financial recovery and improvement shows up in the favorable adjusted EBITDA results that Tim will touch on. But first, I want to underscore that expanding the size and breadth of our product sales and managing other corporate objectives has become an increasingly complex responsibility. Over the years, we have prided ourselves in keeping administrative expenses low by public company standards. Growing our senior management team brings added expense, but also offers new opportunities and benefits. I've already experienced some of those benefits working with Tim for just over a month now. We are optimistic as we work our way through the balance of 2025.
Speaker Change: Our financial recovery and improvement.
Speaker Change: Shows up in the favorable adjusted EBITDA results of Tim will touch on but first I want to underscore that expanding the size and breadth of our product sales and managing other corporate objectives is becoming an increasing increasingly complex responsibility over the years, we have prided ourselves.
Speaker Change: And keeping administrative expenses low by public company standards growing our senior management team brings added expense, but also also offers new opportunities and benefits have already experienced some of those benefits working with Tim for just over a month now we are optimistic as we work our way through that.
Speaker Change: Balance of 2025 with that said, let me introduce Tim Fiori, Tim would you. Please tell us a bit about your background and talk about some of the first quarter financial highlights.
Tim Fiore: With that said, let me introduce Tim Fiore. Tim, would you please tell us a bit about your background and talk about some of the first quarter financial highlights? Thanks, Michael. As Michael mentioned, I've been here at ImmuCell for just over a month. Before coming to ImmuCell, I worked for 24 years in various finance roles for Idex Laboratories, a well-respected public company headquartered in nearby Westbrook, Maine. Most recently, I was Senior Director of Finance and Commercial Operations for their livestock, poultry, and dairy, known as LPD, water testing, and Idex's OptiMedical human health line of business.
Tim Fiori: Thanks, Michael as Michael mentioned I've been here for just over a month before coming to MSL I worked for 24 years in various finance roles for IDEXX laboratories, a well respected public company headquartered in nearby Westbrook, Maine. Most recently I was senior director of finance and commercial operations for their livestock poultry and dairy known as L. P D water testing in <unk>.
Tim Fiori: This is Aki medical human health line of business.
Tim Fiore: Let's talk about the first quarter financial results for ImmuCell. Product sales during the first quarter of 2025 increased 11 percent or $810,000 over the first quarter of 2024 to a record $8.1 million. Those record quarterly sales eclipsed the previous record set in the fourth quarter of 2024. These strong sales helped us reduce our order backlog from $4.4 million as of December 31, 2024 to $4 million as of March 31, 2025. I'm pleased to say that we've continued to eat away at that backlog, which was down to $3.4 million as of May 6, 2025. We previously had announced our goal of increasing annual production capacity to $30 million or more per year.
Tim Fiori: Let's talk about the first quarter financial results from yourself product sales during the first quarter of 2025 increased 11% or 810000 over the first quarter of 2024 to a record $8 1 million those record quarterly sales of eclipse the previous record set in the fourth quarter of 2024.
Tim Fiori: These strong sales helped us reduce our order backlog from $4 4 million as of December 31, 2024, 4 million as of March 31, 2025 and.
Tim Fiori: I am pleased to say it at least continue to eat away at that backlog, which was down to $3 4 million as of May six 2025, we previously had announced our goal of increasing annual production capacity to $30 million or more per year, our achievement of $15 8 million in sales during the six month period ended March 31, 2025 suggests that we are achieving that.
Tim Fiore: Our achievement of $15.8 million in sales during the six-month period ended March 31, 2025 suggests that we are achieving that target. Product sales during the 12-month period ended March 31, 2025 increased by 28 percent or $6 million to $27.3 million compared to the 12-month period ended March 31, 2024. To remain successful, we must continue to avoid significant contamination events and equipment breakdowns and operate with strong production yields. We pay our bills and drive our cash flows with the Gross Margin Dollar. We experienced some low growth margin percentages in prior periods as we dealt with low output and scrap costs related largely to the contamination events mentioned previously.
Tim Fiori: Oregon.
Tim Fiori: Product sales during the 12 month period ended March 31, 2025 increased by 28% or 6 million to $27 3 million compared to the 12 month period ended March 31, 2024 to remain successful we must continue to avoid significant contamination events and equipment breakdowns and operate with strong production yields.
Tim Fiori: We pay our bills and drive our cash flows with the gross margin dollars we.
Tim Fiori: We experienced some low low gross margin percentages in prior periods as we dealt with low output and scrap costs related largely to the contamination events mentioned previously the 42% gross margin during the first quarter of 2025 is an improvement over the 37% during the fourth quarter of 2024, but we still have more work to do to achieve our target of 40.
Tim Fiore: The 42% gross margin during the first quarter of 2025 is an improvement over the 37% during the fourth quarter of 2024. But we still have more work to do to achieve our target of 45% or The increase in sales and the improvement in gross margin are important.
Tim Fiori: 5% or more.
Speaker Change: The increase in sales and the improvement in gross margin are important I take nothing away from those accomplishments, but I would like to talk for a moment about adjusted EBITA.
Tim Fiore: I take nothing away from those accomplishments, but I would like to talk for a moment about adjusted EBITDA because the impact of non-cash depreciation expense on our bottom line is significant. As a reminder, adjusted EBITDA, as opposed to just EBITDA, includes an add-back of stock-based compensation expense, which is another non-cash expense that is included in net income as calculated in accordance with GAAP. We created adjusted EBITDA of $2.3, $3.7, and $3.3 million during the 3-month, 6-month, and 12-month periods ended March 31, 2025. These strong results compare very favorably to adjusted EBITDA of just $458,000, $247,000, and $-280,000 during the 3-month, 6-month, and 12-month periods ended March 31, 2024.
Speaker Change: Because of the impact of noncash depreciation expense on our bottom line is significant as a reminder, adjusted EBITDA as opposed to just EBITDA includes an add back of stock based compensation expense, which is another noncash expense that is included in net income is calculated in accordance with GAAP, we created adjusted EBITDA of $2 three $3 seven.
Speaker Change: $3 3 million during the three months six months and 12 months periods ended March 31, 2025. These strong results compare very favorably to adjusted EBITDA of just 458200 47000 and negative 280000 during the three months six month and 12 month periods ended March 31 2012.
Speaker Change: Four with.
Tim Fiore: With regards to the other financial results, the press release and the Form 10-Q that we filed last night provide the complete, unaudited P&L and balance sheet results. Lastly, I encourage you to review our corporate presentation slide deck. I believe it provides a very good summary of our business strategy and objectives as well as our current financial results. A May update was just posted to our website last night. See the investors section of our website and click on corporate presentation or contact us for a copy.
Speaker Change: With regards to the other financial results the press release and the Form 10-Q that we filed last night provide the complete unaudited P&L and balance sheet results. Lastly, I encourage you to review our corporate presentation slide deck I believe it provides a very good summary of our business strategy and objectives as well as our current financial results EMEA update was just posted to our web.
Speaker Change: Late last night.
Speaker Change: See the investors section of our website and click on corporate presentation or contact us for a coffee with that said, we would be happy to take your questions. Let's have the operator open up the lines.
Operator: With that said, we would be happy to take your questions. Let's have the operator open up the line. Thank you. We will now begin the question and answer session. To ask a question, you may press star, then 1 on your telephone keypad. If you are using a speakerphone, please pick up your handsets before pressing the keypad. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. Anyone who has a question may press star and 1 at this time. Once again, for your questions, please press star and 1.
Speaker Change: Thank you we will now begin the question and answer session to ask a question with my question then one on your telephone keypad. If you are using speaker phone. Please pickup your handset before pressing the key.
Speaker Change: Anytime Youre question has been addressed and you would like to withdraw your question. Please press Star then two.
Speaker Change: Anyone who has a question press star one at this time.
Speaker Change: Yeah.
Speaker Change: Yeah.
Speaker Change: Once again for your questions. Please press star and one.
Speaker Change: Okay.
Speaker Change: We have a question from George Melas M. K H management. Please go ahead.
George Melas: We have a question from George Melas, MKH Management, please go ahead. Good morning, Michael and Tim. Hey there, George. Good morning. How are you? Good, very well.
George Melas: Hi, Good morning, Mike and Tim.
Tim Fiori: Hey, George Good morning, how are you.
Speaker Change: Very well.
George Melas: Question on the product mix. And I, first of all, I have to say I really like how you report the revenue ahead of time, and then file your Q before the call. So it helps us sort of get ready for, you know, understanding the call. On the product mix, this quarter was quite strong on TriShield, which I think was 71% of sales compared to 55% in the previous quarter.
Speaker Change: Question on the product mix and I first of all that is yes, I really like how are you.
Speaker Change: And the point there rather than you have had the time and then file youll queue before the call. So it helps us sort of get ready for you know understanding the call on the product mix this quarter.
Speaker Change: Quite strong on Tri Shield, which I think was 71% of sales compared to 55% in the previous quarter.
Michael Brigham: So I have two questions. One of them is on the new sort of bulk powder product. How do you expect that to contribute towards the end of 25 and maybe 26? And then it seems that the mix of TriShield and Bivalent has relatively little impact on the gross margin. And maybe could you comment on that? Yeah, thanks, George. I'm looking at the queue. Yeah, you pointed out the first quarter at 70% tri-shield and 30% other, you know, that's three months with with 12 months, it's 64% tri shield 36% other TriShield has been a big seller since we launched it just a just a few years ago.
Speaker Change: Two questions one of them is on the new sort of bulk powder product. How do you expect that to contribute towards the end of 'twenty five and maybe in 'twenty six and then.
Speaker Change: It seems that the mix of Tri Shield and bivalent has relatively little impact on the gross margin and maybe could you comment on that.
George Melas: Yes, Thanks George.
George Melas: Looking at the Q, you pointed out the first quarter at 70% Tri Shield and and.
George Melas: 30% out of their.
George Melas: <unk> three months with 12 months, it's 64% Tri shield, 36% other.
Speaker Change: Tri Shield Theres been a big seller since we launched it just a just a few years ago. The broader claims that really makes that product.
Michael Brigham: It's the broader claim set really makes that product. on the market, based on efficacy, based on being similar to a vaccine in the coverage of the pathogens that it works on. So that's the exciting driver of our growth, and you know, we're always looking at what else can we do and how can we expand the product line and how can we grow sales. So when you mentioned your question on the bulk powder, that is still in development. We're on track to get that product out into the market over the second, third, and fourth quarter, but we have no sales yet.
Speaker Change: Excel in the market based on efficacy based on being similar to a vaccine and the coverage of the pathogens that.
Speaker Change: That it works on so that's that's the exciting driver of our growth.
Speaker Change: And you know we're always looking at what else can we do and how can we expand the product line and how can we grow sales.
Speaker Change: When you mentioned your question on the.
Speaker Change: The bulk powder is still in development, we were on track to get that product out into the market over the second third and fourth quarter, but we have no sales yet so it's it's a it's it's.
Michael Brigham: So it's, it's, it's... It's a different format in that it's, again, bulk, as you mentioned, George, as opposed to in a capsule or a tube, it's going to be used as a feed additive and it's going to go to big calf ranches where they're not, you know, accustomed to dosing individual calves with a capsule or with a tube. So more to come on that. I like the development progress that's being led by our VP of Sales and Marketing, Bobbi Jo Brockmann, but no sales report yet. So that's a new event, a new upside for us.
George Melas: A different format and that is again bulk as you mentioned George as opposed to in a capsule or two but it's going to be used as a feed.
George Melas: Attitude and it's Gonna go to big Caf branches, where they're not accustomed to dosing individual cabs with the capsular with it.
George Melas: The tubes so more.
George Melas: More to come on that I liked the development.
Speaker Change: Progress is being led by our VP of sales and marketing Bobbi, Jo brockmann, but but no sales to report yet so that's a.
Speaker Change: That's a new event of new upside for the.
Speaker Change: The last nine months of the year.
George Melas: The last nine months of the year. Did that answer you, George? That totally does.
George Melas: Did that answer you George.
Speaker Change: Over to you guys and maybe.
Michael Brigham: And maybe... you know, the correlation of gross margin to the to the product mix right now. It seems like, regardless, it seems like you achieve really strong growth margin, regardless of whether TriShield is 70% or 55%. We just want to see if you see if there is a bit of an impact, the mix on the gross margin. Yeah, you know, we do price according to our estimated Costing you know by format so tri-shield is quite a bit more expensive than the bolus or the bolus is quite a bit more cost effective than the tri-shield, but I would argue you know you pay for you get what you pay for and People are willing to pay for that tri-shield and get that broader coverage And we do have you know quite a bunch quite a large amount of fixed costs so we do benefit and we did see that benefit both in the fourth quarter at 37% and more so in the first quarter here at 42% of just moving our Laborers largely fixed our all our equipment and facility costs fixed is moving over higher volumes so all product formats benefit With that volume growth and that that that got us to the 42 and as Tim said We're not you know still a work in progress.
Speaker Change: You know the correlation of our gross margin to do that to the product mix right now.
Speaker Change: With.
Speaker Change: Regardless.
Speaker Change: It seemed like you achieved really strong gross margin regardless of whether Tri shield is 70% to 55% I'm just trying to see if.
Speaker Change: If there is a bit of an impact the mix on the gross margin.
Yeah, you know, we do price according to our estimated <unk>.
Speaker Change: <unk> by format. So Tri shield is quite a bit more expensive than the bolus or the bolus is quite a bit more.
Speaker Change: Cost effective than the than the trade show, but I would argue you pay you get what you pay for and people are willing to pay for that trial, she doesn't get that broader coverage.
Speaker Change: And we do have quite a bunch of quite a large amount of fixed cost. So we do benefit and we did see that benefit.
Speaker Change: In the fourth quarter at 37%.
Speaker Change: More so in the first quarter here at 42% of just moving our labor is largely fixed our all our equipment and facility costs fixed is moving over higher volumes. So all product formats benefit with that volume growth and that that got us to the 42 and as Tim said.
Speaker Change: Yeah still a work in progress we still got room for improvement.
George Melas: We've still got room for improvement Great. Congratulations. Fantastic result.
Speaker Change: Okay, Congratulations fantastic resolved and Tim welcome to 18 men.
George Melas: And Tim, welcome to the team and wonderful to have you on board. Thank you, George. For any further questions, please press star and 1 on your telephone.
Speaker Change: To have you on board.
Tim Fiori: Thank you George.
Tim Fiori: For any further questions. Please press star and one on your telephone.
Speaker Change: We have a question from Ross Colander Capital Alliance. Please go ahead.
Russ Tollender: We have a question from Russ Tollender, Capital Alliance. Please go ahead. Yeah. Greetings, Michael and Tim. Thank you. Hey, good morning.
Tim Fiori: Yeah.
Speaker Change: Greetings, Michael and Jim.
Speaker Change: Thank you Hey, good morning, I appreciate the Oh, a little more detail and and breakouts of our expense categories under the new CFO here. So that's appreciated already.
Russ Tollender: Appreciate the a little more detail in in breakouts of expense categories under the new CFO here. So that's appreciated already. And in the focus, I think just in the presentation on the adjusted EBITDA and the trailing 12 months. I guess looking at the business, there was one last contamination event a year ago, April timeframe. And I'm curious, in Q2 of last year, how much EBITDA erosion was there from that event? that, you know, I guess what I'm driving at. Q2 and Q3 of last year might have been lower EBITDA than we would expect from the core business in Q2 and Q3 of this year.
Speaker Change: And they end up.
Speaker Change: I think just in the presentation on the adjusted EBITDA.
Speaker Change: Trailing 12 months.
Speaker Change: I guess looking at the business there was one last contamination eat that.
Speaker Change: A year ago.
Speaker Change: April timeframe.
Speaker Change: And I'm curious.
Speaker Change: In Q2 of last year.
Speaker Change: How much Colorado EBITDA erosion.
Speaker Change: Was there from that event.
Speaker Change: You know I I guess, what I'm driving at is.
Speaker Change: Q2, and Q3 of last year might have been lower EBIT.
Speaker Change: EBITDA then we would expect from the core business in Q2 and Q3 of this year.
Russ Tollender: So, can you help us kind of... Create expectations for Q2 and Q3 this year for EBITDA. Right.
Speaker Change: So can you help us kind of creep.
Speaker Change: Create expectations for Q2 and Q3 this year for EBITDA.
Speaker Change: Right, Yeah, it's a great question Ross.
Tim Fiore: Yeah, it's a great question, Russ. You know, we did answer that on an annual basis. I don't have that broken out on a quarterly basis. I'm referring to about page 26 in the queue where we talk about the scrap per year. And so part of my answer would be 22, that total scrap cost is $589,000. $589,000. year ended 23, it was 527, 527,000. And then 24 was 407,000. So you know, pretty around half a million per year during that expansion phase where we're incurring those, those, those Contaminations, as far as 2Q, yeah, there's going to be, you know, that contamination, you're remembering it right, April 24 was the last one.
Speaker Change: Did I answer that on an annual basis I don't have that broken out on a quarterly basis I'm, referring to about page 26 in the queue.
Speaker Change: Talk about the scrap per year.
Speaker Change: And so part of my answer would be 'twenty, two that total scrap costs was $45 89 599000.
Speaker Change: Year ended 23 was 527 527000 and then the 24 was 407000, so you know pretty around half a million dollars per year during that expansion phase, where we're incurring those those.
Speaker Change: Those.
Speaker Change: Contaminations.
Speaker Change: As far as two two.
Speaker Change: Yeah. This is gonna be a you know that that contamination, you're remembering it right April 24 was the last one so that affected that full year of just 407000, but.
Tim Fiore: So that affected that full year of just 407,000. But most of that would have been in the first quarter because that was just one contamination in April and then none for the rest of the year. Not answering with a specific number, but a direction. I got it. Maybe a better way of asking is, were there revenue implications still in Q2 and Q3 of last year? or, or how do we look Right, right. No, the revenue rebound, you know, began in the fourth quarter of 24. So we were down, you know, we were, we set those consecutive records fourth quarter of 24, and then beat that record first quarter 25.
Speaker Change: Most of that would've been in the first quarter because that was just one contamination in April and then for the rest of the year. So.
Speaker Change: Not answering with the specific number but our direction.
Speaker Change: I got it maybe a better way of asking is.
Speaker Change: Where there are revenue implications still in Q2 and Q3 of last year.
Speaker Change: Or or how do we look.
Speaker Change: Right right no. The revenue rebound began in the fourth quarter of 24. So we were down we were when we set those.
Speaker Change: Second of records fourth quarter of.
Speaker Change: 24, and then beat that record first quarter 25. So you know that's a is comparing to those reduced periods, but nonetheless those are our best two.
Michael Brigham: So you know, that's is comparing to those reduced periods. But nonetheless, those are our best. Two quarters in our, you know, in our history. Oh, yeah, absolutely. Congratulations. I'm I'm driving at, you know, kind of what could be expectations for revenues for the next couple of quarters. I guess the reality is we should expect greater EBITDA from the enterprise after the next couple quarters because the comps from a year ago were maybe lower than the level of the business you're able to conduct currently. Yeah, I think that's fair. I mean, we definitely We definitely want to, you know, be real clear on that, you know, the fourth quarter and the first quarter are strong, they look strong relative to the to the reduced quarters to the reduced First nine months of 24, but I think the other thing, and Tim and I were just looking at our notes here, is also factor in the backlog.
Speaker Change: Two quarters.
Speaker Change: You know in our history.
Speaker Change: Oh, yeah, absolutely congratulations I'm I'm driving at <unk>.
Speaker Change: Kind of what could be expectations for revenues for the next couple of quarters I guess.
Speaker Change: The reality is we should expect.
Speaker Change: Greater EBITDA from the enterprise after the next couple of quarters, because the comps from a year ago or.
Speaker Change: Maybe lower than the level of the business you are able to conduct currently.
Speaker Change: Yeah, I think that's fair I mean, we definitely.
Speaker Change: We definitely want to.
Speaker Change: B B.
Speaker Change: Real clear on that you know the fourth quarter and the first quarter are strong they look strong relative to the to the reduce quarters to their reduced.
Speaker Change: First nine months of 'twenty, four, but I think the other thing and Tim and I were just looking at our notes here.
Speaker Change: It is also a factor in the backlog.
Michael Brigham: So that's, you know, the second quarter is going to benefit, Tim mentioned it, what did you say, Tim, three points? We got 3.4 million at May 6th, so we have two things going on, increased capacity and then clearing out that accumulated backlog, making progress on that through the second quarter. And yeah, so we don't do the public projections of the revenue, but I guess we think we're trying to make it clear what comparing the good period to the bad period. Let's see what the sales team can do, because they're now allowed, you know, able to go out and actually bring in new business, where over the period there of 24, they were they were really stuck, they were dealing with irritated customers and allocating scarce product.
Speaker Change: No. That's it you know the second quarter is going to benefit Tim mentioned it what did you say Tim 3.4 I believe.
Speaker Change: We've got you know so it's $84 million at Mesa at May six. So you know we are so so we have two things going on increased capacity and then clearing out that accumulated backlog and making progress on that through the through the second quarter and yeah. So.
Speaker Change: No I don't have I don't we don't do the public projections of the revenue, but I guess I'm trying to we think we're trying to make it clear what comparing the good periods of the bad period and.
Speaker Change: Let's see what the sales team can do because they're now allowed.
Speaker Change: Well to go out and actually bring in new business, where over the period. There 24 are they were they were really stuck they were dealing with irritated customers and allocating scarce product.
Speaker Change: And bringing in new customers really didn't help us.
Michael Brigham: And bringing in new customers really didn't help us. Now, that transition will be able to, I mean, the sales team has just made a great pivot from, from that scarce product allocation period to the to the business growth period going forward. So not a numerical answer to your question, but directionally, I think that that's where we're going, clear the backlog and bring back customers we lost and, and find new business both with the existing product line, and the expansion of the product line that we talked about with George to the bulk powder. So really, what you're saying, I guess what I'm driving at is the core business EBITDA kind of run rate is much greater than 3.3 million for 12 months.
Speaker Change: Now that transition will be able to that means the sales team has just made a great pivot from from that scares product allocation period to the to the business' growth period going forward. So.
Speaker Change: Not a numerical answer to your question, but Directionally I think that that's where we're going to clear the backlog and bring back customers. We lost in and find new business, both with the existing product line and the expansion of the product line that we talked about with George to the the bulk powder.
Speaker Change: So really what you are saying or I guess what I'm.
Speaker Change: I'm driving at is the core business EBIT dollars.
Speaker Change: Kind of a run rate is.
Speaker Change: Much greater than $3.3 million for 12 months, that's funny gosh yeah.
Speaker Change: Yeah, Yeah, I guess, you must know and I think maybe that maybe it was slow to follow your question there yeah definitely look at that.
Michael Brigham: Yeah, I guess you're right. No, and I think maybe maybe I was slow to follow the question there. Yeah, definitely look at the three that we that's why we did those three periods. The three is is more indicative and the six more indicative of the recovered company. And the 12 has a He has a six month lag in it. Well, I think that you know, the next part of my question is maybe a statement.
Speaker Change: Three that we that's why we did those three periods and the three is more indicative than the six more indicative of the recovered company and the 12 has a.
Speaker Change: Yes, it's a six month flagging it yeah.
Speaker Change: Well I.
Speaker Change: I think that.
Speaker Change: The next part of my question is maybe a statement.
Russ Tollender: That's the core business, but you're spending $800,000 a quarter roughly on product development for most of it going to the new product. uh approval. So if you wouldn't have been doing... Additional product development, your core business for First Defense is worth a lot more than the EBITDA, the enterprise. Yeah, I think there's a lot the variability in the sales and in the gross margin is what we need to track. I think what we can count on is that admin expense, noting the modest increase we've agreed to, to fund and the but the other expenses are more straight line.
Speaker Change: That's the core business, but you're spending $800000 a quarter roughly on our product development for most of it going to the new product.
Speaker Change: Approval.
Speaker Change: And.
Speaker Change: So if you wouldn't have been doing.
Speaker Change:
Speaker Change: Additional product development.
Speaker Change: Your core business for first defense is worth a lot more.
Speaker Change: The EBITDA of the enterprise.
Speaker Change: Yeah, I think there's a lot of the variability in the sales and in the gross margin is what we need to track I think what we can count on is that admin expense, noting the modest increase there.
Speaker Change: Agreed to to fund and the but the other expenses are more straight line. So I think what was important to answer. Your question. There is because we that's one of the reasons, we put together that segment footnote and I would really yeah. I think that's what you're doing Russ or if you're not I would encourage you to look at that Noah.
Russ Tollender: So I think what was important to answer your question there is that's one of the reasons we put together that segment footnote, and I would really, yeah, I think that's what you're doing, Russ, or if you're not, I would encourage you to just look at that and know it. I was just trying to get the number in front of me towards the end of the footnote. Number 16, and I think that really is my best answer to your question, is when we break the business down to the scours, to the mastitis, and to the other, the other is very small.
Speaker Change: I'm trying to get the number in front of me.
Speaker Change: Or is the end of the footnotes number 16, and I think that really is my best answer to your question is when we break the business down to the scours to the mass status and to the other the other is very small the mastitis is the retain and that's the one that we are.
Russ Tollender: The mastitis is the retain, and that's the one that we are actively seeking strategic options to cover that big expense, and then the scours standalone is just what the business would be. without the other two categories, just purely the scourge business. Well, I think there's a lot of value here is what I'm driving at. And that you've been investing quite a bit of product development capital here, which detracts from the EBITDA of the kind of existing core business, all of which shareholders approve. And I think we're all excited to see Yes, so you know the new product come to fruition for mastitis.
Speaker Change: Are actively seeking a strategic options to cover that big that big expense and then the scours Standalone is just what the business would be.
Speaker Change: Without the other two categories just purely the scours business.
Speaker Change: Well I think theres a lot of value here is what I'm driving at and that you've been investing quite a bit of product development capital here, which detracts from the EBITDA of the kind of existing core business all of which shareholders approved and I think we're all excited.
Speaker Change: C.
Speaker Change: Hey.
Speaker Change: So yeah, the new product come to fruition for mastitis, So any update on that I guess you got it in the past.
Michael Brigham: So any update on that? I guess you got it in the process. I'm glad you touched on that because yeah, I pointed to that segment footnote. That's fair. Also, we always fully disclose depreciation because it's huge, and it won't affect that EBITDA and it is. It is a big piece of that product development spend, but then, you know, we touched on it more in the press release than in our script, but the investigational product use is really a new development, a really important development. You know, we're all frustrated by not being able to achieve that FDA license yet, and there are things that we can control and things that we can't, and we're frustrated but can't control.
Speaker Change: I'm glad you touched on that because yeah I pointed to that segment footnote that's fair I also.
Speaker Change: Always fully disclosed depreciation because it's huge and it won't affect that EBITDA and it is.
Speaker Change: It is a big piece of that product development spend but then you know.
Speaker Change: We've touched on more in the press release and in our script, but the investigational product use is really a new development are really important development you know, we're all frustrated by not.
Speaker Change: Not being able to achieve that FDA license yet and.
Speaker Change: And there are things that we can control and things that we can and fresh.
Speaker Change: Frustrated that I cant control it.
Michael Brigham: So it really is hung up right now based on the need for our contract manufacturer to clear inspection, and it would be horrible if that was the end of the story, but the new piece of the story is this investigational use, while it won't generate revenue, getting the product out to market right now, right in the next few months, through the balance of the year, the sales team is going to do a really good job of getting product and getting customer feedback, and that's what investigational product use is. It's a way that the FDA creates a little bit of flexibility.
It really is hung up right now based on the need for our contract manufacturer to clear inspection and it would be a horrible if we if that was the end of the story, but what the new piece of the story is this investigational use well it won't generate revenue.
Speaker Change: Getting the product out to market right now right in the next few months through the balance of the year.
Speaker Change: The sales team is going to do a really good job of getting product in and getting customer feedback and that's what investigators product uses it's it's a way that the FDA creates a little bit of flexibility you. We are not granting you the license yet, but we're giving you the ability to get mark.
Michael Brigham: We're not granting you the license yet, but we're giving you the ability to get market feedback. So that's a big step, and I wish we had the bigger step, which is just full commercial sales and FDA approval. We simply don't, and this allows us to move forward. test this product that, you know, hasn't been tested since efficacy trials years ago. So we'll, we're looking forward to reporting on those results, you know, they'll start late second quarter into third quarter and have some results around the year end as far as outside of the lab and on a commercial dairy.
Speaker Change: Feedback.
Speaker Change: So that's a big step and I wish we had the bigger step which is just for commercial sales in FDA approval, we simply don't and this allows us to move forward.
Speaker Change: To test this product that hasn't been tested since.
Speaker Change: This efficacy trials years ago. So.
Speaker Change: But we're looking forward to reporting on those results.
Speaker Change: It'll start.
Speaker Change: Late second quarter into third quarter and have some results around year end as far as the you know.
Speaker Change: Yeah.
Speaker Change: Outside of the lab and on the commercial dairy how the product performed.
Russ Tollender: How did the product perform? Well, congrats on what on the six months of performance, the opportunities ahead and the perseverance over many years.
Speaker Change: Well congrats on what on the six months of performance the opportunities they have to add the perseverance over many years and good luck going forward.
Tim Fiore: And good luck going Hey, Russ, Tim's got one point for you on this is a good one that I missed. Yeah, just just wanted to mention, you know, when you were thinking about EBITDA and the full year estimate, when you're in you're thinking of that, I would consider that Q1 is a seasonal high. Not going to quantify exactly, you know, relative to other quarters, but there is seasonality. We do have to watch that. Yeah. And I would add to Tim's right, but also that backlog. It mitigates a little bit of that seasonal bump because we're right now we're just selling almost everything that we make.
Speaker Change: Tim's got one point for you on this is good one that I missed yeah. Just just wanted to mention you know when you were thinking about EBITDA and the full year estimate when you're and you're thinking of that I would consider that Q1 is a seasonal high I'm not going to quantify exactly you know relative to other quarters, but there is seasonality we do have to watch.
Speaker Change: Yeah, and I would add to Tim's right, but also that backlog.
Speaker Change: It makes mitigate something that mitigates a little bit of that seasonal bump because we're right now we're just selling almost everything that we.
Tim Fiore: So yeah, going forward, that Q1 is always going to be the high season. And going forward, we're not going to have a backlog. Okay, thank you.
Speaker Change: So yes going forward that Q1 is always going to be the high season.
Speaker Change: And going forward, we're not gonna have a backlog.
Speaker Change: Okay. Thank you.
Jane Lindeman: Awesome. The next question from Jane Lindeman, Private Investor. Please go ahead. Hey, Mike, it's Bruce and Jane. First, we want to congratulate Company. Thank you. Yeah, appreciate that. Both of you. Thanks. Welcome and also.
Speaker Change: Awesome.
Speaker Change: The next question from Jamie Dimon private Investor. Please go ahead.
Bruce: Hey, Mike It's Bruce Jay in the first week.
Speaker Change: Gratulate U.
Bruce: On the company on.
Bruce: Really really nice quarter.
Bruce: Thank you yeah I appreciate that both of you. Thanks Youre welcome and also.
Bruce: Exactly what's a few questions on what's the difference between that you could.
Bruce and Jane: A few questions. What's the difference between that? Investigate this and the product or and and and and approval and what how come we can investigate it But it's not Well, the biggest difference is it's not commercial sales. So it's not a revenue initiative. It doesn't generate revenue, but it is It's very similar in that we're going to dose, we're going to deliver product to cows whether under the investigational status without license or under You know, commercial approval with a license, we're going to put retained into CALS and track data. So the real difference is, because of the inspectional issues that are CMO, we don't have a license.
Bruce: That's the gate.
And the product.
Bruce: And and approval what how come we can investigate it but it's not approved.
Bruce: Well the biggest difference is it's not commercial sales. So it's not a revenue initiative it doesn't generate revenue, but it is.
Bruce: It's very similar and that we're gonna dose, we're going to deliver product to cows, whether on the investigational status without license or under.
Bruce: You know commercial approval with a license we're gonna put to retain into cows and track data. So there are real differences.
Bruce: Cause of the inspection issues at our CMO, we don't have a license we're not going through distribution typical sales, where you just move out a lot of product.
Michael Brigham: We're not going through distribution, typical sales, where you just move out a lot of product. We really wanted to do something like this anyway, even with license. We had previously referred to it as a control launch. We weren't going to just mass market a novel, practice-changing product like this through distribution. And we're going to hand-hold. And this just gives us the approval to start those studies, to deliver that product, to gather that data, while the final stages of that FDA license and approval are... are still in process. quarter, Great results of this quarter.
Bruce: We really wanted to do something like this anyway, even with license. We had previously referred to it as a controlled launch we weren't going to just mass market and novel practice changing product like this through distribution and we're gonna We're gonna Handhold and this just gives us the approval to start those studies.
Bruce: To deliver that product to gather that data.
Bruce: While the final stages of that F D, a license and approval or.
Bruce: Our and still in process.
Bruce: Thank you at this point.
Bruce: This quarter.
Bruce: The great results of this quarter.
Bruce: At this point.
Michael Brigham: Stop having to sell common shares. The company is profitable. It's certainly a factor. It's certainly a factor, Bruce. We monitor that closely. I'd like to refer to the ATM as we're opportunistic. So that means you sell certain shares at certain prices, and you consider your long-term capital needs even beyond just our profitability, our debt obligations, our CAPEX desires, slash almost obligations, obligations to grow. But you saw us very active. You can see this both in the MD&A discussion and in the subsequent event. You can see that during 2024, when we needed to be, we were very active.
Bruce: Stop having to sell.
Bruce: Common shares.
Bruce: Because the company is profitable.
Bruce: It's certainly a factor.
Bruce: It's certainly a factor Bruce we monitor that closely and I'd like to refer to the ATM as we're opportunistic so that means you sell certain shares at certain prices and you've considered or your long term capital needs, even beyond just our our profitability or our debt obligations are capped.
Bruce: Next desires slash almost obligations obligations to grow.
Speaker Change: Yeah, you saw is very active and you can see this both in the Qs.
Speaker Change: M DNA just discussion and in the subsequent event you can see that during 2024.
Speaker Change: When we needed to be we were very active and more recently, we've been less active. So we just have a lot of it's a great tool to to be.
Bruce and Jane: And more recently, we've been less active. It's a great tool to be... So at this point, you would look at numbers that were, you know, you know, higher $5,000. Right, a lot of that 24 money went out in the 350 to 370 range, which is, you know, was needed cash, but the trade off was unwanted dilution. But yeah, look at that subsequent event note, you can see the activity is much, much, much smaller, as I think appropriate to where we stand today. Right, it seems as the company gets more and more profitable.
Speaker Change: Because of its flexibility and I think we just continue to watch that going forward and consider all those capital needs be beyond just our operating expenses, but you know because as I said debt and capex and growth and yeah, less recently and more back.
Speaker Change: 24, when we were in the group of the contamination in it.
Speaker Change: It really really was very very central and productive for us.
Speaker Change: So at this point he was looking at numbers that were.
Speaker Change: Yeah.
Speaker Change: You know higher than.
Speaker Change: $5 or whatever.
Speaker Change: Right a lot of that 24 money went out in the $3 50 to $3 70 range, which as you know was needed cash where the trade off was unwanted dilution, but yeah look at that subsequent event note you can see the activity is much much much smaller as I think appropriate to.
Speaker Change: Where we stand today.
Speaker Change: It seems as the company gets.
Speaker Change: More and more profitable.
Speaker Change: Hum.
Speaker Change: Knees.
Speaker Change: Really farhan.
Michael Brigham: really far out on this, you know, this stock. really skyrocketed. I definitely agree. And would you, you know, as, again, as retained you know, gets approval. and you're no more contamination. At some point, would you look to maybe project? Futures. Thank you. you know, what the company do so that people have an idea. What you anticipate... Yeah, extremely difficult to do with retain. It's it's a practice changing it moves the mastitis paradigm. It's a whole new thing. So very hard to do with retain. And I think the track record on first offense is the better indicator.
Speaker Change: Stock without really skyrocket.
Speaker Change: Yes.
Speaker Change: Oh, sorry.
Speaker Change: I I believe I definitely agree.
Speaker Change: And would you you know as good as retain you know gets approval.
Speaker Change: And your no more contamination.
Speaker Change: Good point would you look to maybe.
Speaker Change: Project.
Speaker Change: And to the futures.
Speaker Change: No.
Speaker Change: The company is.
Speaker Change: Two.
Speaker Change: So that will have an idea of.
Speaker Change: What's going on.
Speaker Change: Well you know what you would anticipate.
Speaker Change: Yeah.
Speaker Change: It's extremely difficult to retain.
Speaker Change: Practice changing it.
Speaker Change: Paradigm.
Speaker Change: Only thing.
Speaker Change: Very hard to do with retain.
Speaker Change: First defense is a better indicator I mean, we're going to drive.
Michael Brigham: I mean, we're going to try we talk a lot about our production capacity. We talked about getting doubling from 15 or 16 million to 30 or 30 plus We do talk a little bit about the desire to get capacity up to 40 million, so some of those projections come from just, you know, we have a hope and we have a projection, so we build capacity to meet that, but at the same time we don't have the benefit of one or two or any financial analysts that could kind of help us on those projections and make those projections with us, so this small company has stuck, without an analyst, has stuck to timely, as one of the questioners said.
Speaker Change: Can you talk a lot about our production capacity.
Speaker Change: Without getting too.
Speaker Change: 15 or 16.
Speaker Change: <unk>.
Speaker Change: We do.
Speaker Change: Sorry to get capacity up to $40 million.
Speaker Change: So some of those projections come from Justin.
Speaker Change: Got it.
Speaker Change: Yeah.
Speaker Change: Our projection so.
Speaker Change: Capacity to meet that.
Speaker Change: But sometimes we don't have the benefit of.
Speaker Change: One or two.
Speaker Change: Financial analysts who can help us.
Speaker Change: Sections.
Speaker Change: It makes me projections.
Speaker Change: Is this more company.
Speaker Change: Without analysis, it's up to us.
Mike: Hi, Mike.
Mike: As one of the questioners.
Bruce and Jane: was that George? Yeah. Anyway, that early I think we will stick with that early announcement on the top line because we know that quick after the end of the quarter. little hesitant to get more deeper into projections because it's just subject to change. And we know one thing about projections is they're always wrong. And they're just either high or low. All right, no, no, listen, you guys are, you know. I was just looking more into the, you know, into the future. Okay, but as you get a handle on retain and look, you know, the companies come out and they do conservative projections.
Mike: Yeah.
Mike: Yeah, Hey, why that early.
Speaker Change: I would stick with that early announcements on the top line because we know that after the end of the quarter.
Mike:
Mike: What does it entail.
Mike: More deeper into projections.
Mike: Just to change them.
Mike: We know one thing about projections.
Mike: And then just either.
Mike: Alright.
Mike: Yeah.
Mike: Yes.
Mike: I'm doing a wonderful job congratulations.
Mike: I was just wondering.
Mike: For the future as opposed to you know not.
Mike: Oh Wow.
Mike: Okay.
Mike: As you get hands on training.
Mike: You've got companies come out and they do.
Mike: Server developed projections.
Mike: And.
Michael Brigham: And usually, what you said, working with the analysts, it appears that the analysts look to the companies more than the companies look to the analysts. And I think it's something it's certainly been our objective for years. We haven't succeeded, but we'd love to have that interactive collaboration. That's that's missing for ImmuCell right now. that third party financial analyst. Well, I would work collaboratively, as you said, right. And as you, you know, as the company grows, it becomes more profitable. follow you. Hopefully one. We'll either follow you because they own it, or one of the other...
Mike: Usually easily.
Mike: What you said was you know working with.
Mike: Yeah.
Mike: Yeah.
Mike: The company as one company.
Mike: And I think that's something.
It's certainly been our objective.
Mike:
Mike: Okay.
Mike: Love to have.
Mike: Collaboration.
Mike: That's that's missing for us right now.
Mike: Third party financial wellness.
Mike: Right.
Mike: As you said.
Mike: And then.
Mike: Rosemarie.
Mike: I don't want people following us hopefully you wanted to be.
Mike: One of them.
Mike: Following you because they own it.
Mike: Well.
Mike: One of the other services.
Mike: We fool or something.
Operator: For more information visit www.immucell.com All right, well, listen, thank you very much. Congratulations. That makes sense, Bruce. Thanks for your thoughts. Yeah. Alright, be safe and healthy and good luck to everybody. Alright. Thank you so much. Bye-bye. Enjoy. Thanks. Again, if you have a question, please press star and 1.
Mike: Yeah.
Mike: You know maybe somebody like us.
Mike: So.
Mike: Alright, well listen thank you very much congratulations.
Mike: That makes sense Bruce thanks for your thoughts.
Mike: I'm with you.
Mike: Alright.
Mike: Good luck everybody alright.
Mike: Thanks.
Mike: Yeah.
Mike: Please go ahead.
Mike: Why.
Joe Diaz: This concludes the Q&A session.
Mike: So in a sense.
Joe Diaz: I would like to turn the conference back over to Mr. Diaz for any closing remarks. Thank you. Thank you, Vicki, and thank all of you for participating on today's call.
Mike: And I would like to turn down.
Mike: Okay.
Mike: Closing remarks, thank you.
Mike: Thank you Vicki and thank all of you.
Mike: Participating on today's call.
Joe Diaz: We look forward to talking with you again to review the results of the second quarter ending June 30, 2025, during the week of August 11, 2025.
Mike: Look forward to talking with you again to review the results of the second quarter ending June 32020.
Mike: But you have to be.
Speaker Change: Oh Wow.
Operator: That concludes today's call. Thank you and have a great day. This conference is concluded. Thank you for attending today's presentation. You may now disconnect. Goodbye. Thank you for watching. © BF-WATCH TV 2021 © BF-WATCH TV 2021 Music
Mike: 2025.
Mike: Today's call. Thank you and have a great okay.
Mike: Yeah.
Mike: The conference has concluded thank you for it.
Mike: Presentation, you may now.
Mike: Goodbye.
Mike: Yeah.
Mike: Hum.
Mike: Yeah.
Mike: Okay.
Mike: Okay.
Mike: Yeah.
Mike: Okay.
Mike: Okay.
Mike: Okay.
Mike: Okay.
Mike: Yeah.
Mike: Okay.
Mike: Yeah.
Mike: Yeah.
Mike: Yeah.
Mike: Yeah.
Mike: [music].
Mike: Okay.
Mike: Okay.
Mike: [music].
Mike: Yeah.
Mike: [music].
Mike: Yeah.
Mike: [music].
Mike: Yeah.
Mike:
Mike: [music].
Mike: Yeah.
Mike: [music].