Biote Corp.

Hello and welcome to the BIOTE first quarter 2025 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one. Please note, this event is being recorded. I would now like to turn the conference over to Simon Seroviecki, Please go ahead.

Thank you for joining us today. This afternoon, Dante published financial results for the first quarter ended March 31st, 2025. This news release is available in the investor relations section of the company's website. Hosting today's call are Brett Christensen, Chief Executive Officer, Bob Peterson, Chief Financial Officer, and Mark Beer, Executive Chairman. Before we get started, I would like to remind everyone that management will make statements during this call that include forward-looking statements regarding, among other things, the company's financial results, future performance growth opportunities, business outlook, strategies, goals, research and development, manufacturing and commercialization activities, competitive position, regulatory process operations, benefits of its solutions, anticipated impact on macroeconomic conditions on its business, results of operations, financial conditions, and other matters that do not relate to historical facts. These statements are not guarantees of future performance. They are subject to a variety of risks and uncertainties, some of which are beyond the company's control. Actual results could differ materially from expectations that reflect any forward-looking statements. These statements are subject to risks, uncertainties, and assumptions that are based on management's current expectations as of today. BioT undertakes no obligation to update them in the future. Therefore, these statements should not be relied upon if they are presented to the company's views as of any subsequent date. For discussion of risks and other important factors that could affect their actual results, please refer to our SEC filings, available on the SEC's website and the Investor Relations section of our website, as well as risks and other important factors discussed in earnings release. Management also refers to adjusted EBITDA and adjusted EBITDA margin, which are non-GAAP financial measures to provide additional information to investors. A reconciliation of the non-GAAP to GAAP measures is provided in an earnings release, with the primary differences being stock-based compensation, fair value adjustment to certain liabilities, transaction-related expenses, and other non-operating expenses. Please refer to our first quarter 2025 earnings release for reconciliation of these non-GAAP measures to close comparable GAAP measures. And I'll turn the call over to Brett.

Thank you, Simon, and thank you all for joining us. I'll begin by providing an update on our business and the key initiatives we announced today, and then I'll turn the call over to Bob for a review of our first quarter financials and our 2025 financial outlook. After our comments, we'll open the call for questions. In the first quarter, we generated strong financial performance with strength in our dietary supplements business, more than offsetting the expected softness in procedure revenue. We experienced continued improvement in our gross profit margin, which increased 300 basis points to 74.3% due to the vertical integration of a 503B manufacturing facility. Total revenue increased 4.7% and adjusted EBITDA decreased 3.4% compared to the same period in 2024, keeping us on track with our 2025 financial forecast for revenue and adjusted EBITDA. As we expected, procedure revenue was impacted by reduced commercial effectiveness in part due to the residual effect of the transition to our enhanced clinical decision support software, as well as ongoing competitive pressures. A slowdown in new clinic additions, as well as a minor decrease in procedure volumes and select reductions in average selling prices, also contribute to the decline in procedure revenue. On last quarter's earning call, I identified three areas of emphasis for 2025, which I believe are fundamental to commercial execution at a high level. The priorities were, one, accelerate new providers, two, maximize value from top-tier clinics, and three, improve commercial accountability and discipline. Consistent with these comments, today we announced a strategic organizational restructuring designed to drive sustainable, profitable growth and create long-term value for our stockholders. This restructuring builds on the foundational progress we achieved over the past year, supporting our expanded capabilities within the hormone optimization and therapeutic wellness space. We believe that the decisive actions we are taking will enable us to scale our business more effectively and deliver a high level of financial performance. We are focused on three major objectives. First, we intend to accelerate new provider wins to further expand our nationwide network. Second, we intend to strengthen relationships with our existing top tier providers. And third, we intend to improve our financial performance by strengthening accountability and improving consistency and discipline throughout the commercial organization. Among the key steps we are implementing is the realignment of our commercial team with a goal of increasing productivity and driving new clinic growth. As part of this realignment, we are working to transition certain commercial support functions to active field sales positions, effectively increasing our field sales team by approximately 25%. We expect that our expanded and strengthened sales force will enable us to recruit new clinics at an accelerated rate and provide the dedicated support our new providers require as they build their medical practices. Additionally, we are streamlining sales leadership to ensure better communication and efficiency to drive more consistent performance across the entire commercial team. We're also updating our sales compensation structure to align incentives with our sales goals. As we direct our sales efforts to drive a new clinic growth, we also recognize the importance of retaining and maximizing the value from our existing top tier providers. Over the past year, BioT has significantly expanded our capabilities and product offerings, encompassing hormone optimization, therapeutic wellness, and dietary supplements. At the same time, we have expanded our education, training, and technical resources, further differentiating BioT in the marketplace. By strengthening engagement with our top-tier providers, we believe we will be better positioned to reinforce our role as a trusted partner, offering a science-based approach to patient care and ongoing practice building support. As I noted last quarter, we are implementing these initiatives quickly, but recognize they will take time to show results. I strongly believe these actions will strengthen our commercial organization through increased productivity and deeper customer engagement and improve financial performance. As we move forward with our plans, I would like to reiterate my confidence in our exceptional team and our shared commitment to execute on our strategic priorities. While we expect 2025 will be a transition year from a financial standpoint, I believe the actions we announced today are essential to accelerating our growth and enabling us to realize our full potential. I look forward to updating you on our continued progress in the quarters ahead.