Alpha Teknova, Inc.

Good day and welcome to the TechNOVA first quarter 2023 financial result call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, press star 1 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Senior Vice President of Marketing at Technova, Jennifer Henry. Please go ahead. Thank you, Operator.

Welcome to Technova's first quarter of 2023 Earnings Conference Call. With me on today's call are Stephen Gunstream, Technova's President and Chief Executive Officer, and Matt Lowell, Technova's Chief Financial Officer, who will make prepared remarks and then take your questions. As a reminder, the forward-looking statements that we make during this call, including those regarding business goals and expectations for the financial performance of the company, are subject to risks and uncertainties that may cause actual events or results to differ. Additional information concerning these risk factors is included in the press release the company issued earlier today, and they are more fully described in the company's various filings with the SEC. Today's comments reflect the company's current views which could change as a result of new information, future events, or other factors, and the company does not obligate or commit itself to update its forward-looking statements except as required by law. The company's management believes that, in addition to GAAP results, non-GAAP financial measures can provide meaningful insight when evaluating the company's financial performance and the effectiveness of its business strategies. We will therefore use non-GAAP financial measures of certain of our results during this call. Reconciliations of GAAP to non-GAAP financial measures are included in the press release that we issued this afternoon, which is posted to Technova's website and at www.sec.gov. Non-GAAP financial measures should always be considered only as a supplement to, and not as a substitute for, or as superior to, financial measures prepared in accordance with GAAP. The non-GAAP financial measures in this presentation may differ from similarly named non-GAAP financial measures used by other companies. Please also be advised that the company has posted a supplemental slide deck to accompany today's prepared remarks. It can be accessed on the investor relations section of Technova's website and on today's webcast. And now I will turn the call over to Stephen.

Thank you, Jen. Good afternoon and thank you everyone for joining us for our first quarter of 2023 Earnings Call. Technova is a leading producer of critical reagents for the life sciences industry to accelerate the introduction of novel therapies, vaccines, and molecular diagnostics that will help people live longer, healthier lives. We manufacture high-quality custom reagents with short turnaround times and are positioned to scale with our customers as they advance their products from discovery to commercialization. We had a good start to the year. Our team continued to manage in a dynamic environment by delivering results in line with our plan, including increasing revenue sequentially by 16%. We are particularly pleased that we are not only tracking well to our expected financial metrics for the year, but we are also executing on our key initiatives on or ahead to plan to position the company for sustainable, accelerated growth. First, we saw an increase in clinical solutions customers in the first quarter and believe the growth demonstrates a stabilization in overall demand from our customers, and we remain optimistic about the long-term potential of our target markets. We also continue to see strength in our commercial funnel and remain confident in our top-line guidance for the full year. Second, Our new state-of-the-art modular manufacturing facility is on track for GMP-grade production by mid-2023. In addition, we are encouraged by early indications of interest from certain of our customers who have begun to schedule audits for early in the third quarter. We believe this new facility, plus our existing operating infrastructure, will give us the capacity to deliver approximately $200 million in annual product revenue when fully utilized. On the R&D front, I am pleased to say our new product pipeline is progressing ahead of schedule. In March, we announced a collaboration with Sartorius via Separations to help our customers improve AAV purification processes. Building on this news, last week we launched our first ever set of proprietary agents, which we believe can save months of development time for gene therapy customers as they develop their AAV bioprocessing workflows. As customers incorporate these proprietary reagents into their clinical production processes, we expect to become an even more critical supplier as they advance their therapies towards commercialization. Lastly, we are tracking well to our cost reduction plans. Operational expenses were down sequentially when excluding one-time costs. And while cash outflow in the quarter was approximately $12 million, the corresponding expenses were planned and primarily related to the completion and qualification of our new facility. Thus, we are tracking towards our previously communicated total cash outflow target of approximately $30 million for fiscal 2023. I will now hand the call over to Matt for discussion of the financials.