Bio-Rad Laboratories, Inc.

Thank you for standing by. My name is Prila and I will be your conference operator today. At this time, I would like to welcome everyone to the BI-RAD fourth quarter and full year 2024 results conference call and webcast. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press store followed by the number one on your telephone keypad. And if you would like to draw your question, please press the star one again. Thank you. I would now like to turn the conference over to Edward Cheung, Head of Investor Relations. You may begin.

Thanks, operator. Good afternoon, everyone, and thank you for joining us. Today, we will review the fourth quarter and full year 2024 financial results and provide an update on key business trends for Bio-Rad. With me on the call today are Norman Schwartz, our Chief Executive Officer, John DiVincenzo, President and Chief Operating Officer, and Roop Lakharaju, Executive Vice President and Chief Financial Officer. Before we begin our review, I would like to remind 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 followings 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 the reconciliation of these non-GAAP measures to the comparable GAAP results contained in our earnings release. With that, I will now turn the call over to our Chief Operating Officer, John DiVincenzo.

Hello, and thank you everyone for joining today's call. Since joining Bio-Rad five months ago, I'm excited to share the progress we've made in aligning our strategic priorities, focusing on execution, and achieving key milestones in our transformation. First, I'm pleased to report that we successfully met our revised 2024 guidance for both revenue and operating margin as presented last August. Our clinical diagnostic business performed slightly better than forecasted, while our life science segment was affected by continued softness in the biopharma market. Despite some revenue challenges, we achieved gross margin expansion in 2024 through our productivity improvements. Driven by our lean initiatives in our manufacturing sites and supply chain, execution of our global footprint rationalization, and effective cost management. These will be sustained improvements in our P&L in 2025. I'm also excited to announce that we've entered into a binding offer to acquire Stila Technologies, a move we believe will significantly complement our digital PCR portfolio. Going forward, Stila's platform would enhance our product strategy in applied research and clinical diagnostics, allowing us to expand our offerings in digital PCR. We expect the transaction to close by the end of Q3 2025, subject to consultation with relevant employee representatives, regulatory approvals, and customary closing conditions. Additionally, we've taken further steps to streamline our cost structure. These actions are designed to better position Bio-Rad for success as we move toward our strategic and financial goals for 2025 and beyond. Looking across our markets, we saw the continued trends we've experienced over the past year. Diagnostic performed as expected with broad-based global demand. However, the Asia-Pacific region saw a decline due to the earlier than expected adoption of a reimbursement change for diabetes testing in China during the fourth quarter. This adjustment, not related to volume-based procurement, standardizes rates for certain clinical diagnostic tests nationwide. We don't currently anticipate further reimbursement changes for diagnostics in 2025. Keep in mind that China represents high single-digit percentage of Bio-Rad's total revenue. In life science, we are seeing a modest recovery, though demand in biopharma in China remains soft. We did see a seasonal uptick from academic customers and biopharma research accounts. And our process chromatography sales improved in the second half of 2024, and we expect growth in this area in 2025. We were also encouraged with the increased activity in new programs using our media, which bodes well for the future outlook for our process chromatography business. For our droplet digital PCR portfolio, we saw continued strong demand for reagents and consumables with low double-digit growth year over year. Interest in our assays for oncology and cell and gene therapy applications remains high. and we're maintaining strong win-loss ratios for our platform. Entering 2025, we expect a gradual recovery, particularly in the biopharma sector. While demand for instruments remains soft, we are having more conversations with biopharma customers and building a healthy order funnel. However, this gradual pace of recovery is likely to impact the uptake of life science instrumentation in the short term. In the academic segment, research funding globally has been soft throughout 2024, and we have not factored in a change in dynamics for 2025. However, we need more information to understand the impact, if any, of last week's announcement on the cap for US NIH indirect funding. In Europe, funding remains mixed with modest increases in Germany and the UK, while France continues to be soft. And in Asia, We're seeing some early signs of improvement in research funding in China due to its stimulus programs. So in 2025, our focus remains on operational and commercial excellence. We aim to increase consumables attachment and prioritize e-commerce as part of our growth strategy. And as I've discussed with many of you, innovation remains at the heart of Bio-Rad's long-term growth strategy. Beyond our anticipated acquisition of Stila, we're excited about key updates to our portfolio. including a refreshed NGC chromatography platform, the ChemiDoc Pro imaging system, and a new version of our QX600 digital PCR system for the diagnostic market. We're also expanding our process chromatography portfolio with the launch of a larger 45-centimeter prepack column and additional Nuvia resins that enhance purification capabilities. Our QX continuum program is making significant progress, and we continue to see it as an important part of our digital PCR portfolio in 2025 and beyond. So given the moderated revenue growth outlook, we view 2025 as a stepping stone towards stronger, profitable growth. We will continue driving innovation, enhancing our supply chain, and implementing cost and productivity initiatives to support margin improvement. As the life science market normalizes, we believe BioRat is well positioned to leverage top-line growth. Thank you for your continued support. I will now pass you to Rup to review the financial results. Thank you, John.