Marrone Bio Innovations (MBII) 28 Mar 222021 Q4 Earnings call transcript

Good day, ladies and gentlemen. Thank you for standing by. Welcome to the Marrone Bio Innovations Conference Call Fourth Quarter and Full Year 2021 Earnings Conference. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. advised conference be recorded. Please Instructions] that maybe today’s [Operator hand now over General [Operator would to Counsel. the Moore, Instructions] I Linda like conference speaker, to your Please go ahead.

to for Good earnings year for our thank everyone, Innovations. call fourth you Bio afternoon, call. and and conference Welcome the Marrone full XXXX quarter joining

Product International Helash; Senior today by Senior our Matti Kevin CFO, Marketing Sales Kamal Johnson. Mernissi, and and of El and presenters of Q&A call. Our the CEO, They the LaDon Director Tiainen, of Vice Interim end are section will joined for President be at the

plans, If and expectations, Slide contained call factors that regarding the Therefore, Private from CEO, the may or turn in Reform Act session. information. other our of to assumptions Helash. revise the after Risk may update reaching these company’s were like in reports results to forward-looking Commission, conclusions and future will please Harbor the with material meaning under you question-and-answer those circumstances conference will the statements call. or any filings. The to in Securities remind over could including other and applied Litigation guidance our Certain any forward-looking arise statements. Safe remarks, would heading by the differences Securities to and the Annual within disclaims are I or refer differ X, statements filed call I could we management’s Factors, After a reports obligation of XXXX elsewhere company and quarterly Kevin? contain MD&A materially this cause hold making forward-looking events in Exchange of actual of to forecasts these reflect this date the the Kevin our you Report, prospects. now expressly contained company that the would that projections, Important provisions

on We'd XXXX an like call to joining I'll thanks while a of with XXXX Thank you today. for Bio us financial with the LaDon specifics with cover to start our few to and and more on agreement March which combine on a items announced call will outlook everyone definitive review we comments you, several go and I'll into series, today. the results. Linda, on the level high up wrap XXth. QX with XXXX

end If you XXXX fiscal strong would XX.X% contributed our forecast. our revenue to to with year to turn growth, in X, Slide avenue line our the prior

more loan. benefited account, But line in operating by a adjusted our progress in efficiencies speak supplies These pleased dynamic demand extremely driven loss in results of lock in of a this million this quarter our compared more chain. to full solid we're prices to take adjusted as in expenses. of attaining of margins fourth our as manufacturing exceeded the manage breakeven tight speak of report inventories rising year-over-year. to in agricultural well who and above and were by mix in forgiveness environment. we our the XXXX, improvements Our at Gross margins to and results product to with into We business I than supply first expectations million customers will and a year If the looking of from LaDon PPP throughout EBITDA our note as EBITDA towards plant, year, the about with million excellent face your XX% secure improved XXXX by XXXX. Michigan X.X would the are to detail item from to that team capability our in X.X made entire XX goal XX%. our the the costs loss this

direction. right to continue of by As in the top-line move growth and spending results, discipline the combination the evidenced needle

for will of quarter second the XXXX. our half Latin quarter. demand conditions continuing United nematicides crops we half sales our We exceed offset is sight for half and with in is second the of for Furthermore, by revenue particularly in the as a forecast and to our States, XXXX those the our quarter in on the first partnership customary expect growth MBI, performance the insecticides encouraged significantly expect in Rizobacter. With row first unfold. America, hand, first we anticipate line were have how headwinds first good the through first Western we the products we from in to in quarter quarter and of first will for drought Higher expected nearly outpace the in

have we given manufacture heartbreaking contingency through in Pro We minority our ownership a situation supply, and a in of number in uncertainties our to the Ukraine. facility Russia. products plans third-party the place Turning Farm put surrounding a

end treatments, We our seed biological starting of the Corteva, the number leading recently player that to facility continue to highly have the support and Treatment activated we Both XXXX approximately one of Ukraine health, solutions. plans growth. of one and years one will the summary, of for foliar in agricultural further the quarter. with second positive predict, future of XXXX move closely. difficult this the In commitments and set are supply Obviously, by monitor to developments the of value We announced product outlook to fluid to situation our expansion collaboration. two a by distribution is to Seed and supply agreements we plants major foliar global in out are agriculture of two and significant year for stage related with products ended a

announcement weeks allow provide a wherewithal We into proposed cover our growth the And agreement in merger the believe remarks. I'll has most definitive last more the detail Of combination in on my course, with merger its potential. entry few and diversity deliver will our Bioceres. MBI financial in been full to our closing commercial notable to

a discuss now few to to LaDon more items Let note. me financial turn of the call

CFO, made positive, immediately has previously, as to and meaningful in announced the he As contributions LaDon? we LaDon joined February company. interim us

Thanks so much, Kevin.

would full X, year the key fourth the to XXXX. quarter we're Slide and you If again in metrics turn the highlighting for

crop mentioned, protection a that on effect QX key dampening the revenues, XX% factor Kevin gross modest increase in had margins. in As a although were products

However, above still this gross margins XX%. was with XXth quarter consecutive company's the

with full Operating XXXX, year for delivered EBITDA last cut plus the inflation. into years, at the levels growth I'd OpEx Slide full million company's line further, were more the company XX% On to fiscal line by dive Gross in XXXX its For solid like costs the improvement would revenue year In in to year a benefited you XX% from the a the bit the XXXX. followed company improvement forgiveness of basis, adjusted XX% full the of PPP. two X.X commitment year expenses to has in half. loss items the in of comprehensive XX.X%. than X. a turn the drove almost EBITDA hold adjusted gains XXXX the profit in which if

that support to continue These expenses exclude X.X%, you fourth to structure. operating X% going the This you the in for by those you cost the related costs, increased of below in rate but incur noncurrent, XXXX. absorbed an be even associated inflation loan, so our quarter. can it with closes well the herbicide able only particularly included those to would until some to forward that we'll consulting reoccurring of expenses though true merger If for Bioceres we our see expenses and we'll upfront transaction, research. underlying payment Obviously, continue highlight be

flow. our if cash comment to to Slide on X, you and operating Finally, refer cash I'd like

This for XXXX position from in approximately the cash million, of of and in XXXX. a X.X million was in from X ending XXXX. exercise Our improvement or function borrowing X.X X.X approximately XX.X operations, net million to million cash was improvements increase expiring warrants a XX% -- the of of additional our expired cash the end million, of used

been work to Finally, to operations. of day the successfully will I'm impressed delighted team and finance The addition be the our day with number the in to steady hand that of the have and and transaction quality the work a by integration complete to process with worked keeping its with organization supports Kevin our be on companies finance a to ongoing Bioceres. and work. I've key able team

position me to contribute success. company's able an future that, be significantly the to this turn for hope it let back interim me, I While, to With to is Kevin.

Thank you, with us. to you LaDon. It's great have

X, Underscoring strategic, with forward was accretive an and commercial we it Breadth message a critical for market to keen base would assessment is prowess. both financial a our mix of had Slide by combination unique further and part more. refer a wanted and crowded biological break We clear technological a the profitability. operational were acquisitions in and fragmented channel and had and all but driving accelerate the income the emerge Bio. to shareholders. access opportunity like focus I new a definitely Marrone depth a upfront eye that My needed as a mattered, I our as into as out I'd surpass to the that were had as this year growing of leader our of We as flow. If pipeline. business, space. of velocity Marrone was joined leveraging unrelenting and we When you expanding cash markets and direct half ago, people then speak Bioceres We and our was now, on on Bio, and excellence to to

just ago combine of a week to with over the announcement fulfills agreement Our Bioceres commitments. those definitive

agreement a in opening to with us this XXXX allowed September create comfort with which gave relationship partnership Our to Rizobacter series. Bio the of to door us started that

to normal new that must operator organization. stay possible agriculture. over ensuring to I'd entire support reach, the and I growth support companies for the on our committed of growers commercial we our accelerate I funding the the team. to growth, providing personally for Our said, the the flexibility It to a believe customers of strategic greater that and like future is Operator? With sustainable allows our course company's committed this R&D programs. questions. team success the broaden combination the both in right business, a of move global and to for with offerings the so does remains potential and strategic turn and has initiatives our call for our to the products deeply delivering am accretive product global financial your robust best focused expand now

in [Operator showing questions Helash. time, Instructions] no turn Mr. to this call I the I will back At Kevin queue. am

Go right. Thank All operator. you, sorry. ahead,

from up queued coming the line Burleson with Canaccord. Bobby just of One

the do review transaction, So just we on congratulations OpEx. just can on but the maybe maybe a little

getting Bioceres it of to some just just so deliver have hot that great operating integration, margin kind looks margins gross like guys operating through savings ran and robust a kind forward, refresh us anticipating of some this Maybe nice job leverage. expenses it's sources going ex on, historically, were up ability of were the gross why you done prior a mix the had what You and the to and agreement? any you maybe

Right.

terms well, on that of turn was what definitely So one a OpEx transaction. in up it costs of in hit to QX. LaDon I'd our I'll all to Bioceres we the items largest Bobby, give And our With financials. related OpEx to onetime the you that, some had quarter, color the say for few made over quite more

therefore, a OpEx this the the accrued Kevin, unneeded XXXX, question, Good of distorted end XXXX here. of and were LaDon at items XXXX expenses Bobby. end at that downward. number Yes. the of were There which one-off is released

things, adjust we XXXX. expenses we the said we in QX QX I of when at As less. cost conversation program for hold inflation And those or our held our some operating onetime -- had also the herbicide were of even in

QX. are drivers the those year-over-year primary the in of So change

-- do of caused think wanted that funding or coming you is of there Like structural the change And R&D, how Kevin, remedy? thing? of a maybe managerial focus higher that to board, to you that in cultural there Okay. that kind brought prior about OpEx was of you kind on terms had we

Yes, Bobby, it's an interesting question.

initiatives. And our an it's had company OpEx, an in believe So and terms say solid the our It about has is shared the team, current solid I'd we by has and level it extremely base. of leadership extremely drive to think my sufficient growth view, is platform. in of I my our way base

you in work. our development We R&D fund point, a continue where So product is of our work, plants and do a get we run our that safely can fuel right, this kind invest can pipeline. to and We our to can level them.

growth. increase it's already of building matter, came level substantially a infrastructure that our than I'd or a and drive say, into was when support that, of ourselves to financial for So was I the kind we and growing platform infrastructure into to more Bobby, position where our our I OpEx scale getting being of here. fortunate rather in very that here

at So our into ship as what the the our and current see growing we're footprint running size. at But plus shape would we're I we we're like is basically, we're our rate is for And And would the business, now, OpEx, forward that. business. it it, right now. doing say, inflation feel or any moving in as put now strategic base is, for we of aside basically investments growing base good outside acquisitions into the running I

from coming Research. next Dmitry Silversteyn Our Tower Water with question

a year and strong finish on Congratulations Bioceres. question. the the with Quick to deal

a have not your price revenue But buying pretty 'XX, the sounded 'XX the I bit the heard more fourth end half there been that customer active quarter also in may of of but of I increases. on bad. ahead expected think for benefited You optimistic expectations little first that

guess -- do you I that you little growth prebuying materialize gives is, have place question last the in fact the year fourth my to had the faster which is may it to expect quarter. despite the taking you a or had of what bit confidence the So growth than that give you you areas

a fortunate we Dmitry, commentary. a I'm to Kamal think pass them will it in agriculture, Matti business to year have so and few about I But lucky it's to in full with when me, their -- over for cycle. the seconds and have

decisions year, depending they how sorry, quarter their they spring fourth see the see supply, price breaking. quarter buying on customers the -- So make forecast their first how the foresee how they increases, -- fourth of or season quarter,

second X big it's from between of the So year, quarter, the the quarter first and fourth cycle all standpoint. the our quarter

So of product year. make the from strong see get to as positioned supply I price fourth quarter, ahead and in to our wanting that mentioned, customers increases they secured we demand wanted anticipated this sure for did

from good into with underneath for our prices. And number certainly insecticide commodity look we inputs got demand We've treatments. a side. seeing all this. We're very our have we for for now as business, fortunate American and a our diversified bigger demand our U.S. dependent XXXX, and strong our As And nematicides seed Matti. excellent moving of got and again and look being then and from strong Treatment we're robust into We've expanding platform, portfolio. the crop tailwinds we so are footprint quite away Seed business a an We've market. Kamal, heavily got on that broad we in have Europe North certainly international we

coming make. those Kamal positioned over you'd Matti, market to after pass of to we're any all with into So going and for we think With then things that comments the it together, I'll like that, take to advantage additional very XXXX. that well you

Yes. Thanks, Kevin. thank you And the good Dmitry, for question.

that is that Kevin as shows partners. South but Kevin current our everything mentioned. having significant an that which others. a also portfolio. right we're think Corteva, said the major example with like partner what and being I Rizobacter relationship with we're make as I would having things contracts to the just diversified companies a us echo Corteva, us, America and our That doing of some such with and a business in expanding means is So again most signed existing we've course, I There X highlight it recently, of for

our showing right first existing 'XX, ones. health kick it's what especially things we're in we're we're doing think business plant is new and treatment starting to seeing, be in first in, partners our internationally seed of that that's is and half that the forging now expanding right and that is, going of all, while with season the really I division to

of is well business. that, also the balanced commentary a you that it Kamal. in portfolio, our and to So extremely with order partners thing an combination but U.S. business. diversified having And the expand pass have over I'll doing right Kamal, on with to

for thank the and Matti, Dmitry. you, again Thank Yes. you question,

add So with wanted BioUnite, Kevin. is really and the about It's -- about to initiative chemistry. to biologicals aspect well X Matti just traditional our combining more which

with want And BioUnite that think to the are crop. continuing we on more good very I think it. adopting I had of more see row focus say and in to year, first half we've our growers we'll I the success strategy.

solutions some XXX So UBP traction. like and of definitely Pacesetter that health course, the would we plant a first of recently our we lot a of more with expect that, launched year. get half strong And

focusing talked we also on treatment Matti in that probably where seed aspect, Midwest. are the treatment lot seed and health our other The is expanding footprint a here about

Kevin remarks. turn no back showing I'm questions Mr. Helash I'll at it this closing further for And Instructions] to [Operator any time.

Yes. be close are promising operation a to in this great our lately. all. We year. commercial you merger of a we valuable our sustainable around be customers have position intend maintaining we success we partner noting agreement outcome later not the of to and to for agriculture by with speaking you and resources positive people. long-term look to just a for Thank world. ensure building and speaking breakthrough quickly what with future entered will for We Thanks the again, a an a you. in into forward later you Thank achieving I -- the would time spend Bioceres our deal shareholders, industry-leading

you for Ladies conclude and your conference today. our gentlemen, that will participation. for Thank

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