VANCOUVER, British Columbia and REHOVOT, Israel – BioHarvest Sciences Inc. , a company pioneering its patented Botanical Synthesis technology platform, today reported its financial and operational results for the third quarter ended September 30, 2024. Third Quarter & Subsequent 2024 Operational Highlights for BioHarvest Sciences:
All figures stated in this news release are in U.S. dollars unless stated otherwise.
- Total revenues for the third quarter of 2024 increased 101% year-over-year to $6.5 million.
- Gross margins expanded by 1,200 basis points to 57% of sales in the third quarter of 2024, as compared to 45% in the same year-ago quarter.
- Management expects fourth quarter 2024 revenues of at least $7.2 million and expects to reach adj. EBITDA breakeven in the second half of 2025.
- Successfully uplisted to the Nasdaq Global Market on Tuesday, November 12, 2024.
- Total VINIA® subscribers increased by 128% as compared to the same year-ago quarter.
- Launched functional VINIA® SuperFood tea line, leveraging the success of the Company’s “VINIA® Inside” strategy following the launch of VINIA® SuperFood Coffee in December 2023.
- Presented at leading small-cap investor conferences including the LD Micro Main Event XVII Conference, Planet Microcap Showcase Vancouver, iAccess Alpha Buyside Best Ideas Investor Conference, and H.C. Wainwright 26th Annual Global Investment Conference.
BioHarvest Sciences: Management Commentary
Ilan Sobel, Chief Executive Officer of BioHarvest, said: “The third quarter of 2024 delivered continued progress in our Products and CDMO business segments – highlighted by continued outperformance on the topline as we doubled down on growth, with third quarter revenue of $6.5 million driven by continued momentum in our VINIA® subscription business and a strong response to our incremental coffee product line, resulting in over a 100% increase in Products revenue. We continued to make steady progress with our Contract Development and Manufacturing Organization (CDMO) Services Business Unit as well, with a highly focused pipeline of impactful prospective customers, some of which we expect to announce in the near-term.
“In our Products division, revenue was driven by our core nutraceutical capsule business and additional ‘VINIA® Inside’ products. VINIA® Superfood Coffee, which is part of the Hot Beverage line-up, received a strong response from our customers, contributing to revenue growth and aging down our customer base. We continued to focus on our innovation pipeline of “VINIA® Inside” products in the quarter as well and are incredibly excited to have announced the launch of our functional VINIA® SuperFood teas just earlier today.
“Ongoing margin optimization initiatives – such as the recent digitization of manufacturing – continue to increase efficiencies across the organization, with gross margins increasing 1,200 basis points to 57% in the third quarter of 2024, as compared to 45% in the same year-ago quarter. While geopolitical events impacted margins due to increased air freight costs and the delayed implementation of certain cost-saving measures, we believe we are well positioned to see notable margin improvements throughout the first half of 2025. We remain laser focused on further enhancing manufacturing margins as we scale, leaning in on growth, and on driving further marketing efficiencies in our end-to-end e-commerce value chain.
“During the third quarter we continued to advance our CDMO division with two established customers and a strong pipeline of potentially near-term prospects. We are scaling rapidly to meet current and anticipated demand, making investments in R&D infrastructure and talent to underscore our commitment to executing for our current and future customers. Each deal we announce reflects our thoughtful and measured approach to only allocating our research bandwidth to impactful CDMO customers with the highest probability to deploy world-changing molecules. This is particularly important as the bulk of our monetization potential comes on the backend in the form of royalties on future commercial sales of any molecule we may develop, which could provide a recurring revenue base over the long term.
“Looking ahead, we expect continued strong growth and margin improvement in our Products division on rising VINIA® sales and a growing portfolio of incremental products such as coffees and teas. In our CDMO division, we are making steady progress on our contracted research projects while concurrently building out our future B2B sales pipeline. With our listing to the Nasdaq Global Market now complete, we believe we are well positioned to unleash the power of a ‘VINIA® Inside’ strategy that we believe will help drive sustainable, long-term value creation for our shareholder partners,” concluded Sobel.
