Bio-Rad Laboratories, Inc.

Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to the BioRad 3rd Quarter 2023 Financial Results Conference Call and Webcast. At this time, all lines are in the 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 the star zero for the operator. And please be advised that today's call is being recorded on Thursday, October 26, 2023. I would now like to turn the conference over to Edward Chung, Head of Investor Relations. Please go ahead.

Good afternoon, everyone. Thank you for joining us. Today, we will review the third quarter 2023 financial results and provide an update on key business trends for BIRAD. With me on the call today are Norman Schwartz, our Chief Executive Officer, Elon Doskell, Executive Vice President and Chief Financial Officer, Andy Last, Executive Vice President and Chief Operating Officer, Simon May, President of the Life Science Group, and Dara Wright, President of the Clinical Diagnostics Group. Before we begin our review, I'd like to caution everyone that we will be making forward-looking statements about management's goals, plans and expectations, our future financial performance, and other matters. These statements are based on assumptions and expectations of future events that are subject to risks and uncertainties. Our actual results may differ materially from these plans, goals, and expectations. You should not place undue reliance on these forward-looking statements, and I encourage you to review our filings with the SEC where we discuss in detail the risk factors in our business. The company does not intend to update any forward-looking statements made during the call today. Finally, our remarks today will include references to non-GAAP financials, including net income and diluted earnings per share, which are financial measures that are not defined under generally accepted accounting principles. Investors should review these reconciliations of the non-GAAP financial measures to comparable GAAP results contained in our earnings release. With that, I will now turn the call over to Andy Lass, our Executive Vice President and Chief Operating Officer, to provide an update on BioRad's global operations.

Many thanks, Ed, and good afternoon to everybody, and thank you for joining us. Well, the third quarter of the year fell below our expectations. The ongoing challenges within the biopharma segment and economic constraints in China continue to drive lower life sciences performance in the quarter. Clinical diagnostic sales were weaker than we forecasted, impacted mainly by the softer China market conditions. We still anticipate a strong year-over-year growth. The clinical diagnostics grew in the fourth quarter. We continue to successfully maintain focus on tight cost control, and on the supply chain front, we experienced modest constraints in supply for our clinical business, which impacted Q3 sales. Backlog remains on track to meet our year-end expectations. In Q3, we experienced further reduced demand from biopharma customers for our process chromatography and from both biopharma and smaller biotech customers for our life science research products. The continued tight spending environment in this segment constrained core DD-PCR sales, which were roughly flat from the year-ago period. Academic and government sales for life sciences were strong in the Americas, but showed declines in APAC driven down by China economic and policy constraints. EMEA academic sales were roughly flat, reflecting a soft funding environment in Germany, offset by stronger performance in the other European countries. While DDPCR sales within the quarter were softer than expected as a result of biopharma spending, we remained very positive on the long-term growth outlook for the platform. During the quarter, we were encouraged by several noteworthy announcements involving DDPCR. On the clinical testing front, our QX1 platform has been selected for SMA testing for all newborns in Hong Kong. And here in the US, Genoscopy announced they have published the results of their pivotal CRC Prevent Clinical Trial, reporting the highest sensitivity for detecting colorectal cancer among similar tests, powered by our QXDX DD-PCR platform. Additionally in the U.S., Verily won a major multi-year national wastewater testing contract from the CDC based on our QX600 platform. We see these as contributors to future growth and a strong reinforcement of the versatility and impact of the technology. As highlighted earlier, China was a continued challenge in Q3 for our life sciences business and unfortunately the economic constraints have now also impacted our clinical diagnostics business which in the first half of the year had been a positive for us in this region. We have now further constrained our expectations for China for the year end and look to 2024 before we expect to see signs of recovery. Our clinical business overall had a mixed quarter. We saw growth in demand in the US and Europe as expected which was partially offset by the softness in China. In particular, we were pleased with the continued momentum for our immunohematology and diabetes franchises in the quarter. Despite the market challenges of this year, we view our strategy framework as being very solid and our platforms and market opportunities as providing sustainable long-term growth. We continue to focus on driving and improving our execution and with completion of a single global instance of SAP have now completed a major component of operational improvement. Looking to the end of the year, we continue to expect the biopharma and small biotech company turn down and ongoing constraints in China and Russia to impact the overall growth through our life sciences business. Although we do expect to see sequentially improved sales in the final quarter of the We remain positive on the momentum and continued growth in the clinical diagnostics business, although somewhat moderated by the greater market constraints in China, as well as ongoing trade restrictions in Russia. Thank you, and at this point I will now pass you to Alain to review the financial results.