BioHarvest Sciences (BHST) Q3 2024 earnings summary

Executive summary

• Achieved first formal earnings call as a public company after uplisting to NASDAQ Global Market, marking a significant milestone and increased credibility.

• Q3 2024 revenue grew 101% year-over-year to $6.5M, surpassing management guidance, with gross margin expanding to 57% from 45% in the prior year quarter.

• Proprietary botanical synthesis technology enables production of potent, patentable plant-based molecules for nutraceutical, cosmetic, pharma, and nutrition markets.

• Commercialized VINIA, a red grape-derived nutraceutical, which drove the majority of $22M+ trailing 12-month revenues and demonstrated strong customer satisfaction and low churn.

• Expanded product portfolio with new launches in superfood coffee and teas, and plans for hydration powders and skincare in 2025.

Financial highlights

• Q3 2024 revenue was $6.5M, up from $3.2M in Q3 2023, driven by 128% growth in VINIA subscribers.

• Gross profit increased 157% to $3.7M (57% margin), up from $1.4M (45% margin) in Q3 2023, due to scale, yield improvements, and packaging cost reductions.

• Operating expenses rose 67% to $5.8M, mainly from increased marketing, new product initiatives, and CDMO division costs.

• Net loss widened to $2.7M ($0.16/share) from $1.7M ($0.13/share) year-over-year; Adjusted EBITDA loss was $2M–$2.1M vs. $1.7M.

• Cash and equivalents at $2.8M as of September 30, 2024, down from $5.4M at year-end 2023.

Outlook and guidance

• Q4 2024 revenue expected to be at least $7.2M, with strong operational execution anticipated.

• Targeting Adjusted EBITDA profitability at $11M–$12M in quarterly revenue, expected in the second half of 2025.

• Long-term goal of 20% Adjusted EBITDA margin for products business, with higher margins targeted for CDMO over time.

• Ongoing margin optimization and cost control initiatives expected to further improve gross margins into the 60% range.

• Anticipates continued growth and margin improvement in Products division, with expansion in VINIA and new product lines.