CryoPort, Inc.

Good afternoon and welcome to Cryoport's fourth quarter and full year 2024 earnings conference call. All participants will start in a listen only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. As a reminder, this call is being recorded. I will now turn the call over to your host, Mr. 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 can be 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 it went 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. Do not undertake any obligation to update or revise any forward looking statements, whether as a result of new information or future events otherwise, except as required by that. 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 describing item 1A risk factors and elsewhere in our annual report on form 10 K to be filed with the Securities and Exchange Commission. And those described from private time in the other courts, 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. Thank you for joining our fourth quarter and full year 2024 earnings call. With us this afternoon is our Chief Financial Officer Robert Stavanovic, our Chief Scientific Officer Dr. Mark Sawicki and our Vice President of Corporate Development and Investor Relations Thomas Heinzen. As a reminder, we have uploaded our fourth quarter and full year 2024 in review document to our website. It can be found on the main page of the Cryoport Inc website. This document provides a review of our financial and operational performance and a general business outlook. If you do not have a chance to read it, I would encourage you to go to the website and download it. Now I will provide you with a brief update on our business and then we'll take your questions. 2024 was a tough year for the life sciences. The effects of macroeconomic conditions and market dynamics were felt throughout the year. We adapted to the challenges and concluded the year with solid results and total annual revenues of $228.4 million, which is in line with our expectations. Our life sciences services business continued to its expansion with double digit year over year growth and bio storage and bio services. Revenue during both the fourth and the full year periods for the full year 2024 of our life sciences services business represented 67% of total revenue compared to approximately 62% last year. We saw considerable revenue growth for the support of commercial cell and gene therapies, which rose 37 and 20% for the fourth and quarter and full year respectively. Cryoport continues to expand its market share in the growing cell and gene therapy industry. As of the year end, we supported a total of 701 clinical trials and an increase of 26 trials over last year with 81 of these trials in phase three. This is a record number of total clinical trials supported by Cryoport and it is indicative of the potential commercial revenue opportunity that is developing. Moreover, we also saw a record number of Cryoport supported commercial approvals over the last year, increasing the number of commercial programs we support from 14 to 19. In our life sciences product business, we think our order patterns are beginning to show signs of stability. I would remind you that even with the downturn of the cryogenic systems market, our management team has continued to provide positive free cash flow from this business. As previously reported, during 2024 we implemented a number of cost management initiatives in our product segment to align our operations with current global industry dynamics. As cost reduction and capital realignment strategies were implemented across our entire company, we made considerable progress in improving our gross margin. For the fourth quarter of 2024, our gross margin rose to .8% compared to .6% in the same period last year. We remain confident that these actions that have been taken are taking are taking effect and will lead us to a return to positive adjusted EBITDA during 2025. At the same time, we have continued to advance our most important business development plans, which have been underway for some time as we strive to balance those plans with our commitment to achieving positive adjusted EBITDA during 2025. We're confident that these undertakings will open up new revenue streams and move us forward. For example, in the fourth quarter, we opened our Integra Cell Crop Preservation Solution with new state of the art facilities located in Houston, Texas and Liege, Belgium. Integra Cell was set up to produce high quality standardized cryopreserve starting material for the manufacture of cell therapies. Based on market research and our first interactions with prospects and newly signed clients, we believe Integra Cell will generate significant revenue as it offers significant advantages to cell therapy manufacturers, allowing them to produce more consistent, more robust, standardized product more efficiently. Integra Cell addresses a critical aspect in optimizing the supply chain for the development and commercialization of cell based therapies. Another example is our Cropport Express Cryogenic CX-HV3 Shipping System, or HV3, which was introduced in January of this year. The HV3 is a revolutionary cryogenic shipper that offers our clients enhanced payload production, storage efficiency, mobility and accessibility. With the introduction of HV3, we also improve patient accessibility to vital cell therapies in smaller cities and remote areas as it will fit into smaller aircraft. We believe this will benefit patient outcomes at large. Looking forward, in 2025, we believe we are well positioned to further capitalize on the anticipated growth of the cell and gene therapy industry. At this time, we're projecting that 23 BLAs or MMA filings could occur in 2025, up from 11 last year. We're happy that 2025 is off to a good start, as three filings have already occurred in January. Cropport's huge base of clinical trials continues to push forward, and we expect to post another record amount of commercial revenue in 2025. Based on all this, we're providing full year 2025 revenue guidance in the range of $240 million to $250 million. We intend to maintain our leading market positions, open up additional revenue streams and unleash our operating leverage as market demand grows. We will complement this with seeking strategic collaborations throughout the year. We're confident that we have taken steps necessary to implement our growth plans and to reach our objectives of positive adjusted EBITDA during 2025. This concludes my prepared remarks, so now I'll ask the operator to open the lines for your questions.

Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by the one on your telephone keypad. You will hear a prompt that your hand has been raised, and should you wish to cancel the request, please press star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. One moment please

for your first question. Your first question comes from the line of Anna Snopkowski from

KeyBank Capital Markets. Please go ahead.

Hi, good afternoon. Thank you for taking my question. This is Anna on for Paul Knight. Maybe to start on the significant and impressive 37% increase in commercial revenue you saw in the fourth quarter. Could you walk through some of the drivers there and whether this was broad based or maybe one commercial therapy that drove this? Thank you.

I think Marks the Wiki can best answer that question.

I'd be happy to answer that question. So a couple of factors. Number one is it was a broad based increase. It wasn't it wasn't focused on one or two clients. You know, some of the key drivers here are, you know, we've seen the, you know, the advancement of earlier line approvals with some of our commercial clients. We've seen, you know, additional companies, you know, get approved. We had five commercial approvals last year and we're starting to see contribution with multiple of those those programs as well, as well as our historical programs continue to expand on a geographic basis, as well as, you know, pushing for a line extension into different therapy classes and all of those have contributed to that strong Q4 performance.

That's helpful. And then switching to the MBE side of the business, it seems like you saw some stabilization there in the fourth quarter. Do you feel confident that this will continue to stabilize or maybe even recover in 2025?

We are seeing the order patterns beginning to show some signs of stability at MBE and we feel that that will continue throughout 2025. It may be uneven, but we think it will continue

to progress.

Thank

you. Thank you. And your next question comes

on the line of Puneet Sura, some living partners. Please go ahead.

Yeah, hi guys. Thanks for the questions. So first one on around the guide for 25, can you elaborate your expectation for service versus product and maybe what are the growth assumptions you have for by logistics and also the cryo gene and the MBE business within the MBE?

In the context of guidance, I think Robert will add to what I have to say for neat and thank you for that question. But, you know, obviously services will be a bigger portion of our goddess and it will grow faster than life sciences products. And with that, I'll turn it to Robert to

elaborate more. Yeah, maybe just a few things to put it in context. We typically don't guide on business units directly. But what I can say is if you look at the revenue growth in bio storage, bio services, which was double digit, the bio services growth, which was 7% year over year. But then in particular, on the cell gene therapy side, you know, the storm growth on the commercial therapy side that obviously drives the services business growth for product. We certainly have to take a more conservative view. Just based on the comments that Jerry had earlier on this call to really look at very modest increases in product revenue for guidance purposes. So it's really driven by the services side.

Okay, that's helpful. And then, you know, there's quite a bit of discussion on tariffs. Just wondering, is there any impact on the cost of the doors or freezers from any of the steel aluminum tariffs, Canada, Mexico or otherwise? And I'm just trying to understand, you know, I'm sure you've thought through that. But are there any tariffs on the freezers from the China plant or anything that is getting serviced from US?

You know, we have thought through that. We do have, Paneet, and, you know, whatever, however, tariffs impact us. And we, you know, we can't tell for sure on all of them, except, you know, the direct things that we hear about the tariffs on aluminum and stainless steel. But we will pass on tariff impacts through surcharges for the period of time that they exist. And so we don't expect impact on our margin. Would you like to comment further,

Robert? So, I think that covers it. I mean, I think what we have demonstrated even, you know, in the past with the supply chain issues that we've had in prior years, that, you know, the management has been able to really maintain solid gross margins. So I think we have quite good control over the cost structure and the ability to ensure that we maintain gross margins for the MBE, for the products business.

I'd just like to make one thing clear. This is Tom, Paneet. The freezers for the US market are made in ball ground Georgia. Cryogenic freezers. Cryogenic freezers and the cryogenic doers are also manufactured in Minnesota. So there is no impact that way for our US business.

Got it. That's helpful. And then when I was looking at your clinical trial growth, you know, just the last question on this. That appears to be about net clinical trial growth of about 6% in 24. Wondering what's your expectation here for 25. And then any impact from NIH indirect cuts, a number of these trials get started in the academic setting and medical schools. So wondering if you're seeing any, you know, updates or impact that you're contemplating from any of those institutions. Thank you.

Paneet, I'll answer the last question first and then turn it to Mark for trial expectations. But in terms of the NIH, we have very little exposure to the situation with the NIH. So we aren't directly concerned about that at this point. Mark, would you answer the second part?

Yeah, happy to. Yeah. So, as you can see with the data itself in Q4, you know, Q4 was the best performance that we've had in, I would say over the last eight quarters on new trial acquisition. And I think that's a manifestation of the improvement in the overall cell and gene spaces that relates to clinical trial activity. I do anticipate that we will see continued strong performance. So I would expect that 2025 will be stronger than 2024 on a new trial acquisition basis.

And then Paneet, as you'll see in the review document, you know, there's another 23 possible filings in 2025. So on the commercial side, there's a lot of activity as well. You know, three filed already in January. We expect another 10 possible approvals of which five are new therapies. So it's a very robust kind of pipeline of activities within the zone gene therapy space.

All right. Thank you.

Thank you. And your next question comes from the line of Tejas Sevant from Morgan Stanley. Please go ahead.

Hi, this is Edmond on Patejas. Thank you for the time. Switching back to the MBE, can you guys elaborate a little bit more on what you guys are seeing from your customers across your geo regions in terms of seeing early signs of stability?

Well, the signs of stability are in the order patterns, and that's a collective thing. So that's as far as I can actually go in answering that question. We see new stability in the order patterns. We do see signs of stability. This doesn't say that everything is stable and rosy, but we are seeing those signs of stability that we like to see in the market.

Got it. And I'm appreciating that your presence in China has gotten smaller over the past few years to about less than 3% of your total. But given the concerns on Chinese retaliation on tariffs, even if nothing has happened yet, to what degree are local substitutes available in the region? And do you continue to think that your For China in China strategy is sufficient in securing a position in the market here?

Yeah, I mean, local sources in China certainly are available, and there are other sources throughout Asia. But we're implementing our China First China strategy as we speak, and that will unveil that later

on. So, yeah, and outside of China, again, this is where Tom mentioned that we have our manufacturing facilities here in the US that manufacture the cryogenic freezers and doers for the US market, for the European market. So in some ways, we mitigate some of that risk that a lot of other companies have in the space with regards to China.

Maybe one last thing to add there is that in our guide, there is no assumption of a recovery from China.

Got it. That's helpful. And then one last one for me. How are you guys thinking about revenue contributions from the five new therapies that were approved of in 2024 for your 2025 guidance? And with the recent layoffs at the FDA, are you starting to hear customers concerned about. Longer approval timelines for selling gene therapies.

Mark, I don't know that we can give guidance on those five therapies, but I'll let you speak to that question.

No, you're absolutely right. We don't break out individual contribution, although we do anticipate that multiple of the new therapies that were launched in 2024 will contribute meaningful revenue to the commercial totals for 25. That's about as far as I can delineate on that. Regarding the FDA, now we do not anticipate the activities within the FDA from a governmental standpoint to have an impact on cycle time. In fact, we've seen very robust approval activity and we continue to see progression there. So I wouldn't anticipate a meaningful impact on the 25 portfolio.

As a matter of fact, one of our customers today announced that they had their BLA received and have a PEDUFA date in August. So things keep moving forward.

Great. Appreciate the time and the answers,

guys. Thank you.

And your next question comes from the line of David Saxon from Needham. Please go ahead.

Oh, great. Good afternoon. Congrats on the quarter. And thanks for taking my questions. Maybe I'll start with Robert just on profitability. You know, the PR notice or noted expectations for getting to profitability in 25. Can you just help us around specificity? You know, when might that be either by quarter, like first half, second half, and then kind of directional expectations for the year? Should we be thinking breakeven or any better or worse?

Yeah, maybe just to frame it a little bit. You know, when we talked about, you know, some of the majority of those activities that really drove that consistent improvement of adjusted EBIT over the last three quarters, moving from a negative 6.6 million to now, you know, negative 1.3 million for Q4. On an annual life basis, that equates to about 22 million. So that is in line with what we were targeting actually a little bit better than what we were targeting. We are, of course, focusing on expanding gross margin and driving profitable revenue growth. And you've seen significant enhancement of our gross margins year over year, both for the services revenue as well as for the product revenue. So I think we're well on track to continue to execute. At the same time, you know, we are driving, you know, certain initiatives that we have that we believe will derive revenue growth in the near future. So that's another aspect to consider. So I think in terms of timing of reaching adjusted EBIT, positive adjusted EBIT, we can't give you, you know, direct timing. But, you know, it is our stated goal to reach that during 2025 and the timing of it really depends on some of the ramp that we expect to see on the service side, but the global zone gene therapy side.

Okay, okay. That was helpful. Thanks for that. And then I wanted to ask on NVE. So, you know, you're noting order patterns are stable. The quarter was pretty strong at 20 million in dollar terms. So, you know, is that a good starting point if, you know, against the backdrop of orders or depends on being stable or is there any like mixed dynamic that we should be aware of that would, you know, materially change kind of quarterly expectations. Thanks so much.

There's no mixed dynamic that we can point to right now.

Okay, great. Thanks.

Thank you. And your next question comes on the line of Subin Nambi from Guggenheim. Please

go ahead.

Hi, guys. Thank you for taking more questions. One question. Once a therapy is commercial, what are the drivers of revenue growth to cryoport on that therapy? Is it just volume ramp for the therapy and indication of something? What are the opportunities to increase your wallet share with the manufacturer?

Yeah, we pursue both avenues. So both both ramp in volume from a patients treated standpoint as well as revenue diversification. So, and many of the cases we're seeing that both of those occur.

Thank you for asking that. And it's, yeah, it's you see that in the bio services, bio storage starting to grow. And hopefully this year, as Mark will probably talk more later on is that integrity sell initiative. So, these are the projects that we've invested in for years that are now starting to get some traction.

Thank you for that, guys. And you did mention that you expect 2025 to be better, but what have you been seeing with respect to biopharma biotech funding in for Q and what trends are you expecting to see in 2025?

Yeah, so I think there was 15.2 billion for all of 24, which was the best year in a number of years. In fact, for cell gene investment, you know, 25 is the best year for cell gene investment. So, I think is going to be is going to be a little bit more challenging from an from an expectation standpoint. You know, I think it'll be a strong year, but we obviously have to see what happens with the federal government and what's happening there. So, so I'll couch that with just a caveat. But the markets themselves are very positive. In fact, a lot of the activity we were at from a trade show standpoint and from a market standpoint, the sentiment overall is much more positive than it has been in a long time. I'm sure Tom was saying that.

No, other than on our quarterly review document that's on our website, when you have a chance to download it on page five, you'll see the cell and gene therapy investments by year. And it was a really good year in 2024.

Correct. And you are assuming the similar levels of funding for 2025 in your buy.

Yeah, I mean, it's we obviously, you know, based on the sentiment that that was expressed at, you know, some of the, you know, JP Morgan facilitate and others. It looks like it'll it'll be a year that we believe will be positive. So, you know, I would expect hopefully that we'll see activity that's that's at par or even a little bit stronger than 24.

And just to clarify that when you think about our guide, especially when you think about our commercial revenue and how we're factoring that, and that has nothing to do with funding. These are from large pharma or public companies that aren't dependent on money coming in the door for their commercial ramps.

I was just asking that because many of the smaller biotech funding biotech companies saw some struggle during the twenty three twenty. Twenty two, twenty three phase. So that is what I was hitting on. Not so much. I completely understand. You come more on the commercial and probably late stage clinical states. And most of what

we thought, you know, as it relate to that at those activities in twenty two and twenty three have already shaken out, you know, if you followed our clinical trial activity over the last four, four to six quarters. You know, we saw higher than average attrition of programs and that was the culling of non productive programs as well as the tightening of the clinical trial environment. But that's that's been winding down over the last two quarters. And I think you see that as evidenced by a strong increase in and clinical trials supported in two for much higher that we've seen last eight quarters.

Super helpful. Thank you.

Thank you.

Thank you. And your next question comes on the line of David Larson from please go ahead.

Hi, congratulations on the good quarter. It looks like you're turning the corner here. Can you talk a little bit about the gross margin expansion? I think it was up over five hundred basis points year over year and a quarter. Both product and service. Just was that more cost reduction efforts or was it really top line growth? Any thoughts there would be helpful. Thank you.

Yeah, absolutely. Look, I think a lot of it is related to the cost measures that we've implemented in the second half of the year. So we've seen a significant improvement in the cost structure based on the actions that we have taken. And that really has helped drive the gross margins to where they are. Yes, right on the service side. We moved for for Q4 into forty six point two percent from forty point eight percent last year. And from the product side, forty point four percent last year to forty five point one percent this year. So both on the service side as on the product side, we've seen a good bounce back of gross margins. You are targeted gross margins in the longer term are fifty five percent. And in that model, we're looking at about thirty percent adjusted even the margin. So those are our targets and we're certainly going to continue to take the actions to drive gross margins. There's still some room on the cost side, but obviously we do expect the revenue growth to contribute to the gross margin as well going forward.

I guess without getting too specific, Robert, would you be expecting like a mid forty percent gross margin in twenty five? Like, is this a good steady state? The four key results?

Yeah, I think I think there's opportunity for for increase throughout the year. I think if you look at the year of twenty five and the guidance we've given, we expect overall to see kind of sequential improvements in our financial metrics. So I think there's still some, some, some upwards mobility on the gross margins. At the same time, I always want to remind everyone we do have some new initiatives that just came online, like in Tegra cell, where we brought up two facilities in Liège, Belgium and in Houston, Texas. And I see there's also going to be a little bit of a drag on that margin until they start seeing more substantial revenue come through the door. But I do expect there's there's some upward mobility on the margins over time.

David, we have not veered from our targets that we've talked about for years. Fifty five percent gross margin, thirty percent adjusted EBITDA. And those are fully in sight. We simply have the drag of some of these projects that we have underway and they will as they come online, as Robert just mentioned, they will unleash operating operating leverage and that will help drive our gross margin up substantially and thereby our adjusted EBITDA. So, so we're confident in our plan and in the way we're implementing it. The cost adjustments that we did were simply reprioritization, some cost management, the required cutting. Where we could and and it's showing it's showing extraordinary results and we intend for that to continue.

Great. And then just one more quick one for integrity. So is that generating revenue right now in any sense for what the revenue contribution will be in fiscal twenty five.

It is

in mark

mark or comment on

that.

Yeah, yeah. So the bottom line is, yes, we have signed our first contracts with with the integrity platform in Q4 and continue to sign contracts in this quarter. We will see some revenue contribution in Q1, although very modest. I don't anticipate significant contribution for twenty twenty five. We'll start to see notable contribution in twenty twenty six. It just takes time because there's a lengthy audit validation process to onboard starting material manipulation. As it relates to FDA regulatory consideration, so it takes a little bit of time, but but we have signed our first contracts in that space, including some top five farmers that have bought into to the platform. We'll start to use it in their portfolio. Which we're very excited about.

That's great. And then for any comments on large freezer, small freezer doers, I've heard the word stabilizing. Is it stabilizing across all three of those categories in large freezer in particular?

What you heard is order patterns are beginning to stabilize and it cuts across the company.

Okay, thanks very much. I'll hop back on the queue. Thank you.

Thank you. And your next question comes from the line of Richard Baldry from gross capital. Please go ahead.

Thanks on the integral cell side can can. And existing clinical trial protocol be altered to to adopt the integral cell or do you think this will be strictly on for a new clinical launches?

This is not alteration. This is an improvement in process. It's a revolutionary improvement and Mark, you want to comment further.

Yeah, so obviously it's being written into quite a few new programs that are starting, but it does not preclude the ability to transition. If they have an established cryopreservation paradigm that's written into their BLA. Yes, they can. They can transition that into our platform. They may have to do an addendum to that, but but it is doable. And in fact, we are, we are seeing that type of activity as well.

And as commercial cell and gene therapy becomes more material to the overall business, can you talk about any underlying seasonality to that specific segment that we should be concerned about? Whether strength or stronger quarters, weaker quarters, whether that's based on numbers and days, holidays, things like that, that we should take into consideration.

Nothing out of the ordinary that you that we can comment on there.

Yeah, there's nothing, nothing specific from a seasonality standpoint. The only impact you'll ever see is is facility shutdowns. You know, where most companies will do a shutdown for the manufacturing for a week or two a year, but they're all different based on companies. So it's, it's impossible to predict those those elements.

Okay, and it sounded like you're largely done the operating expense cuts and got a little bit ahead of your own plan in terms of how much was was realized. We look forward. Do you feel like you're in more of a sideways spending pattern until sort of the top line, you know, begins to come back up or you know, are there some things that they come in early, whether it's the two new facilities launched that bring the overall spending up maybe earlier in the year and then sort of plateaus as the revenues come through to get you back to profitability.

Thanks. Yeah, we'll have some some capex expenditures related to the new facilities in California and in Paris. That's certainly the case. But I think, you know, Maybe two items. One, yeah, we don't expect, you know, any significant increase in optics to as a CFO, I can say that there's always opportunity for additional review of how we do things and where we can potentially take additional cost actions. So I do expect us to really continue to look at ways we can improve efficiency ways we can reduce costs without changing the growth initiatives that we have. So, yeah.

Great, thanks.

Thank you. And your next question comes from the

line of Cal Cruz from UBS. Please go ahead.

Thank you for taking the question. Taking a step back from cell and gene therapy and looking kind of at the broader market and the non cell and gene therapy part of your services business. Can you expect how you expect that

market to evolve over next year? Mark, do you want to take that?

Sure. Yeah, I mean, obviously, you know, we support multiple verticals within life sciences, you know, so and genes are focused, but we also do a lot and direct a patient. We do activity on on, you know, different vaccine activities or other biopharma space. You know, I expect to see those to grow, but nominally or modestly, you know, because because that that, you know, the non cell and gene market is a little bit softer, but we should still see some some growth in that space. You know, the transportation side, I think we'll also see growth, continued growth as it relates to non cell and gene pharmaceutical product distribution. So, So, We just as a growth

part, maybe in IVF as well.

Yeah, yeah. So reproductive medicine, we continue to see, you know, in play a dominant role. We're making very good headway as it relates to expansion of our service platform. X US and I do think we'll see contribution from that this year in the reproductive medicine space. And in as well in the animal health space, we're seeing an acceleration of clinical trial activity for companion animal cell therapy products and we should anticipate seeing quite a few clinical trial starts in support of the animal health space for companion animal

cell therapy in twenty five. Great. Thank you. Anymore. Operator, are there more questions?

Your next question comes from the line of Matt Stanton.

Please go ahead.

Hey, thanks. Maybe just to go back to the twenty five guide. Appreciate you guys. You know, obviously don't give color at the, at the specific therapy line item, but just if we think about the commercial basket overall trying to get a better feel, you know, I think it was up twenty percent for the year. High thirties for the quarter. So, kind of which of those two is better for that bucket for for twenty, twenty five. I think Mark historically you've talked about maybe thirty percent plus type growth over the next few years. So something in the thirty percent plus range fair for the commercial revenue bucket here in twenty, twenty five. Thank you.

I think this fair mark, but you want to come in and know father.

Yeah, I mean, I think we'll be stronger than twenty percent, which was this year from a growth standpoint with a number of new launches in the therapy expansions. I think getting into the mid thirties is probably a hair aggressive. So I think we'll probably be in the, in the high twenties is my guess at

this point in time based on what we're seeing. Super thank you. Yep.

Thank you. There are no further question at this time. I would now hand the call back to Mr. Jerry Shelton for any closing remarks.

Thank you, operator. Thank you all for your questions. I think we had some constructive discussions and we appreciate your interest in in crowd for it. We finished this year with solid fourth quarter results. That were consistent with our expectations. The results reflect the continued growth of our life sciences business, which included the revenue growth we achieved from the support of commercial cell and gene therapy for our life sciences product segment. We're seeing what appears to be a stabilization of orders as we talked about in the question and answer period. And we have said before, our life sciences product business is solid and continues to provide positive cash flow. Our results also show our significant progress in improving our business economics market conditions in 2024 were difficult and we look, we took actions to address this as a result. We're beginning to see the effects of these initiatives, most notably in our gross margin improvement. We continue to anticipate that these actions will guide us to return to a positive adjusted a bit during 2025. We thank you for joining us this afternoon. We appreciate the conversation. We appreciate your continuing support and your interest in our company. We look forward to updating you on our progress again as we report the first quarter of our financial results at the next next fall. Thank you very much and have a good evening.

Thank you and that concludes our call for today. Thank you for participating.

You may all disconnect.