CryoPort, Inc.

Good afternoon and welcome to the CryoPorts second quarter 2022 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 on your touchtone phone. To withdraw your question, please press star then two. As a reminder, the call is being recorded. I will now turn the call over to your host, Todd Frommer, from KCSA Strategic Communications. Please go ahead.

Thank you, Operator. Before we begin today, I would like to remind everyone that this conference call contains certain forward-looking statements. All statements that address our operating performance, events, or developments that we expect or anticipate occurring in the future are forward-looking statements. These forward-looking statements are based on management beliefs and assumptions and not on information currently available to our management team. Our management team believes that these forward-looking statements are reasonable as and when made. However, you should not place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We do not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information or future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results, events, and developments to differ materially from our historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described in Item 1A, Risk Factors, and elsewhere in our annual report on Form 10-K filed with the Securities and Exchange Commission, and those described from time to time in the other reports which we file with the Securities and Exchange Commission. It is now my pleasure to turn the call over to Mr. Gerald Shelton, Chief Executive Officer of CryoPort. Jerry, the floor is yours.

Thank you, Todd. Good afternoon, ladies and gentlemen. We appreciate your joining our earnings call today. With us this afternoon is our Chief Financial Officer, Robert Stavanovich, our Chief Scientific Officer, Dr. Mark Zawicki, and our Vice President of Corporate Development and Investor Relations, Thomas Heinzen. As a reminder, we have uploaded our second quarter 22 in review document to our website. It can be found under investor relations in the events and presentation section. This document provides a review of our recent financial and operational performance and a general business outlook. If you have not had a chance to read it, I would encourage you to go to our website and download it. I'll provide a brief update on our business and then we'll move on to answering your questions. Reflecting strong demand across all business units and geographies, we delivered another solid quarter with second quarter revenue increasing 14% or 18% on a constant currency basis to a record $64.2 million. Importantly, all our business delivered double digits, top line growth in this period. Our gross margin increased slightly, more than 200 basis points from first quarter 2022 as we continued our disciplined approach to CapEx as our new manufacturing operations returned to production. Although the macro environment has been volatile this year, demand for our products and services remains strong. We are meeting this demand and preparing for projected demand through continued expansion of our business through both acquisitions and internal expansion projects. An important milestone for us during the quarter was the opening of our first two global supply chain centers. These two new world-class facilities are located in Houston, Texas, and Morris Plains, New Jersey, and formed the foundation of our global supply chain center network. I'm happy to report that both facilities are fully staffed and accepting clients. During the quarter, we were also busy on the acquisition front as we further strengthened our presence in the EMEA region with the acquisition of Cell & Co. Bioservices, located in Clermont-Ferrand, France. Given its capabilities, licensing, and strategic location, Cell & Co. will play an important role for our company by accelerating the expansion of our new global supply chain center network in the EMEA region by approximately two years. Also, just last week, we closed on the acquisition of Cell Matters, located in Liege, Belgium, Cell Matters specializes in cryoprocess optimization, cryoprocessing, and cryopreservation, which further expands our supply chain platform from the life sciences upstream in support of standardized apheresis collection and processing. Our increasing portfolio of new products, services, and systems, coupled with our expanding global footprint, is continually moving us forward and achieving a growing essentiality within our markets and the life sciences. across the cell and gene industry as we are increasingly providing new solutions to de-risk processes for delivering therapy efficacy for patients in need. We have successfully accomplished this as we have been methodical and disciplined in expanding our platform and global footprint through organic development, acquisitions, partnerships, and business alliances. And looking ahead, we believe that there are still many opportunities in which we can capitalize to deepen our relationship with our clients. Fortunately, we're in a strong financial position with approximately $550 million in cash, which is sufficient to support our planned growth initiatives. Regenerative medicine is growing, and so is our pipeline of potential commercial customers in regenerative medicine, with a total number of global clinical trials supported by Crowdport reaching a record 626 at the end of the second quarter of 2022, a net increase of 65 over second quarter of 2021, and 24 over the year end. It is worth noting that a record 81 of these trials are in phase three, up from 69 this same time last year. In addition to strong demand for our products, systems, and services, we'll also benefit from increased client utilization of our new and expanding bioservices. which includes commercial therapy storage, secondary labeling, kitting, and fulfillment. Therefore, we are confirming our full-year 2022 revenue guidance to $260 million to $265 million. This revenue guidance represents a solid growth of 17 to 19 percent and is driven by current demand across our business units. This ends my prepared remarks. Now we'll be happy to take your questions. Operator, if you will please open the lines for questions.