0001850902false00018509022024-05-132024-05-13

 

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 13, 2024

 

ALPHA TEKNOVA, INC.

(Exact name of registrant as specified in its charter)

 

 

 

 

 

 

 

Delaware

001-40538

94-3368109

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(IRS Employer

Identification No.)

2451 Bert Drive

Hollister, CA 95023

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (831) 637-1100

N/A

(Former name, or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities Registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.00001 per share

TKNO

The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 

 


 

Item 2.02. Results of Operations and Financial Condition.

On May 13, 2024, Alpha Teknova, Inc. (the “Company”) issued a press release announcing its financial results for the first quarter ended March 31, 2024 (the “Press Release”). A copy of the Press Release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. The information in this Item 2.02, including the Press Release, is intended to be furnished under Item 2.02 and Item 9.01 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.

 

Description

99.1

 

Press Release issued by Alpha Teknova, Inc., dated May 13, 2024.

104

 

Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 


 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

ALPHA TEKNOVA, INC.

Date: May 13, 2024

By:

/s/ Stephen Gunstream

 

 

Stephen Gunstream

 

 

President and Chief Executive Officer

 

 


Exhibit 99.1

 

img201297901_0.jpg 

 

Teknova Reports First Quarter 2024 Financial Results

 

First quarter 2024 total revenue was $9.3 million, up 2% from prior year

Launch of Build-TekTM Custom Configurator

Company reaffirms 2024 revenue guidance of $35-38 million

 

 

HOLLISTER, Calif., May 13, 2024 – Alpha Teknova, Inc. (“Teknova” or the “Company”) (Nasdaq: TKNO), a leading producer of critical reagents for the discovery, development, and commercialization of novel therapies, vaccines, and molecular diagnostics, today announced financial results for the first quarter ended March 31, 2024.

 

“I am pleased with our performance in the first quarter, “said Stephen Gunstream, President and Chief Executive Officer at Teknova. “Not only did we deliver solid results, but we successfully introduced our latest product innovation – Build-TekTM Solutions – developed specifically to enable scientists to receive multiple discrete buffer formulations in a matter of days for use during early-stage therapy development. We believe this first-of-its-kind, custom solution will enable our customers to focus on advancing science instead of spending their time on buffer production,” he added.


“During the first quarter of 2024, we delivered strong results overall and managed our operating expenses and capital expenditures to our plan. The combination of these results and improved order trends further strengthens our belief in our full-year outlook of $35-38 million of revenue and free cash outflow of less than $18 million,” explained Matt Lowell, Teknova’s Chief Financial Officer.

 

Corporate and Financial Updates

 

First quarter 2024 total revenue of $9.3 million, up 2% from the first quarter 2023
Launched Build-Tek Solutions, an online custom configurator that supports the fast turnaround of multiple, discrete buffer formulations for use during early-stage research and design of experiments (DOE)
Introduced the latest product in our proprietary AAV-TekTM Solutions product line – the AAV-Tek AAV Stabilizer – a novel, multi-purpose solution that increases capsid yield up to 50% while safeguarding product integrity across the AAV purification workflow
Cash position of $21.6 million and gross debt of $12.1 million at the end of the first quarter 2024

1

 


 

Revenue for the First Quarter

 

 

 

For the Three Months Ended
March 31,

 

(Dollars in thousands)

 

2024

 

 

2023

 

Lab Essentials

 

$

7,266

 

 

$

7,257

 

Clinical Solutions

 

 

1,718

 

 

 

1,609

 

Other

 

 

306

 

 

 

255

 

Total revenue

 

$

9,290

 

 

$

9,121

 

 

First Quarter 2024 Financial Results

 

Total revenue for the first quarter 2024 was $9.3 million, up 2% compared to $9.1 million in the first quarter 2023. Lab Essentials revenue was $7.3 million in the first quarter 2024, flat compared to $7.3 million in the first quarter 2023. Clinical Solutions revenue was $1.7 million in the first quarter 2024, up 7% compared to $1.6 million in the first quarter 2023.

Gross profit for the first quarter 2024 was $2.2 million, compared to $2.4 million in the first quarter 2023. Gross margin for the first quarter 2024 was 23.8%, compared to 26.6% in the first quarter 2023. The decrease in gross profit percentage was driven primarily by increased overhead costs, largely depreciation expense, following the completion of our new manufacturing facility in mid-2023, partially offset by reduced headcount.

 

Operating expenses for the first quarter 2024 were $10.2 million, compared to $11.4 million in the first quarter 2023. Excluding the non-recurring charges recorded in the first quarter of 2024 and 2023 of $1.3 million and $0.7 million, respectively, each related to a reduction in workforce, operating expenses were down $1.7 million. The decrease was driven primarily by reduced headcount and spending, in particular in professional fees.

Net loss for the first quarter 2024 was $8.1 million, or negative $0.20 per diluted share, compared to $8.8 million, or negative $0.31 per diluted share, for the first quarter 2023.

Adjusted EBITDA for the first quarter 2024 was negative $3.8 million, compared to negative $6.1 million for the first quarter 2023. Free Cash Flow was negative $6.7 million for the first quarter 2024, compared to negative $12.0 million for the first quarter 2023. A full reconciliation of these non-GAAP measures to the most comparable GAAP measures is included at the end of this release.

 

Reiterates 2024 Outlook

 

Teknova is reiterating its fiscal 2024 outlook for revenue and free cash outflow. The Company continues to anticipate total revenue of $35 million to $38 million for the fiscal year ending December 31, 2024 (“2024”), which assumes roughly 10% growth in Lab Essentials and the remaining revenue from Clinical Solutions. The Company also continues to anticipate free cash outflow of less than $18 million for 2024.

2

 


 

Upcoming Investor Conference Attendance

 

William Blair 44th Annual Growth Stock Conference

Chicago, Illinois, from

June 4 - 6, 2024

 

Conference Call and Webcast

 

Teknova will host a webcast and conference call on Monday, May 13, 2024, beginning at 5:00 p.m. ET. To access the live webcast, listeners can log onto the call from the Investor Relations section of the Teknova website or by using this link. If you would like to participate in the call, please register for the webcast here to receive a unique PIN number and dial-in information. The webcast will be available for replay on the Company’s website approximately two hours after the event.

 

About Teknova

 

Teknova makes solutions possible. Since 1996, Teknova has been innovating the manufacture of critical reagents for the life sciences industry to accelerate the discovery and development of novel therapies that will help people live longer, healthier lives. We offer fully customizable solutions for every stage of the workflow, supporting industry leaders in cell and gene therapy, molecular diagnostics, and synthetic biology. Our fast turnaround of high-quality agar plates, microbial culture media, buffers, reagents, and water helps our customers scale seamlessly from RUO to GMP. Headquartered in Hollister, California, with over 200,000 square feet of state-of-the-art facilities, Teknova’s modular manufacturing platform was designed by our team of scientists, engineers, and quality control experts to efficiently produce the foundational ingredients for the discovery and commercialization of novel therapies.

 

Non-GAAP Financial Measures

 

This press release contains financial measures that have not been calculated in accordance with U.S. generally accepted accounting principles (GAAP). Teknova uses the following non-GAAP financial measures in assessing the performance of its business and the effectiveness of its business strategies: (a) Adjusted EBITDA and (b) Free Cash Flow.

 

Teknova defines Adjusted EBITDA as net loss adjusted for interest income (expense), net, provision for (benefit from) income taxes, depreciation expense, amortization of intangible assets, and stock-based compensation expense. Adjusted EBITDA reflects further adjustments to eliminate the impact of certain items, including certain non-cash and other items that Teknova does not consider representative of its ongoing operating performance.

 

Teknova defines Free Cash Flow as cash used in operating activities plus purchases of property, plant, and equipment.

 

3

 


Teknova provides Adjusted EBITDA and Free Cash Flow in this press release because Teknova believes that analysts, investors, and other interested parties frequently use these measures to evaluate companies in Teknova’s industry and that such measures facilitate comparisons on a consistent basis across reporting periods. Teknova also believes such measures are helpful in highlighting trends in Teknova’s operating results because they exclude items that are not indicative of Teknova’s core operating performance. Investors should consider non-GAAP financial measures in addition to, and not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP. The non-GAAP financial measures presented by Teknova may be different from the non-GAAP financial measures used by other companies.

 

A full reconciliation of these non-GAAP measures to the most comparable GAAP measures is included at the end of this release.

 

Forward-Looking Statements

 

Statements in this press release about future expectations, plans, and prospects, as well as any other statements regarding matters that are not historical facts, may constitute “forward-looking statements.” These statements include, but are not limited to, statements relating to Teknova’s anticipated total revenue, including our expectations for 2024 revenue and free cash outflow guidance, expected growth in Lab Essentials and Clinical Solutions, and other statements about Teknova’s business prospects, including about the Company’s profitability, strategy of managing operating expenses, and long-term growth strategy. The words, without limitation, “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would,” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these or similar identifying words. These forward-looking statements are based on management’s current expectations and beliefs and are subject to risks and uncertainties, all of which are difficult to predict and many of which are beyond Teknova’s control and could cause actual results to differ materially and adversely from those described in the forward-looking statements. These risks and uncertainties include, but are not limited to, demand for Teknova’s products (including the potential delay to or pausing of customer orders); Teknova’s assessment of fundamental indicators of future demand across its target customer base; Teknova’s cash flows and revenue growth rate; Teknova’s supply chain, sourcing, manufacturing, and warehousing; inventory management; risks related to global economic and marketplace uncertainties, including those related to the conflicts in Ukraine and the Middle East; reliance on a limited number of customers for a high percentage of Teknova’s revenue; potential acquisitions and integration of other companies; and other factors discussed in the “Risk Factors” section of Teknova’s most recent periodic reports filed with the Securities and Exchange Commission (“SEC”), including in Teknova’s Annual Report on Form 10-K for the year ended December 31, 2023, and subsequent Quarterly Reports on Form 10-Q filed with the SEC, all of which you may obtain for free on the SEC’s website at www.sec.gov. Although Teknova believes that the expectations reflected in its forward-looking statements are reasonable, Teknova does not know whether its expectations will prove correct. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, even if subsequently made available by Teknova on its website or otherwise. Teknova does not

4

 


undertake any obligation to update, amend, or clarify these forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable securities laws.

 

Investor Contact Media Contact

Matt Lowell Jennifer Henry

Chief Financial Officer Senior Vice President, Marketing

matt.lowell@teknova.com jenn.henry@teknova.com

+1 831-637-1100 +1 831-313-1259

 

 

5

 


ALPHA TEKNOVA, INC.

Condensed Statements of Operations

(Unaudited)

(In thousands, except share and per share data)

 

 

 

For the Three Months Ended
March 31,

 

 

 

2024

 

 

2023

 

Revenue

 

$

9,290

 

 

$

9,121

 

Cost of sales

 

 

7,081

 

 

 

6,698

 

Gross profit

 

 

2,209

 

 

 

2,423

 

Operating expenses:

 

 

 

 

 

 

Research and development

 

 

860

 

 

 

1,395

 

Sales and marketing

 

 

1,667

 

 

 

2,343

 

General and administrative

 

 

7,381

 

 

 

7,345

 

Amortization of intangible assets

 

 

287

 

 

 

286

 

Total operating expenses

 

 

10,195

 

 

 

11,369

 

Loss from operations

 

 

(7,986

)

 

 

(8,946

)

Other (expenses) income, net

 

 

 

 

 

 

Interest (expense) income, net

 

 

(145

)

 

 

93

 

Other income, net

 

 

 

 

 

18

 

Total other (expenses) income, net

 

 

(145

)

 

 

111

 

Loss before income taxes

 

 

(8,131

)

 

 

(8,835

)

Benefit from income taxes

 

 

(34

)

 

 

(18

)

Net loss

 

$

(8,097

)

 

$

(8,817

)

Net loss per share—basic and diluted

 

$

(0.20

)

 

$

(0.31

)

Weighted average shares used in computing net loss per share—basic and diluted

 

 

40,804,885

 

 

 

28,181,457

 

 

 

6

 


ALPHA TEKNOVA, INC.

Condensed Balance Sheets

(Unaudited)

(In thousands)

 

 

 

As of March 31,

 

 

As of December 31,

 

 

 

2024

 

 

2023

 

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

21,596

 

 

$

28,484

 

Accounts receivable, net

 

 

4,560

 

 

 

3,948

 

Inventories, net

 

 

11,207

 

 

 

11,594

 

Prepaid expenses and other current assets

 

 

1,460

 

 

 

1,634

 

Total current assets

 

 

38,823

 

 

 

45,660

 

Property, plant, and equipment, net

 

 

48,907

 

 

 

50,364

 

Operating right-of-use lease assets

 

 

17,400

 

 

 

16,472

 

Intangible assets, net

 

 

13,952

 

 

 

14,239

 

Other non-current assets

 

 

1,735

 

 

 

1,852

 

Total assets

 

$

120,817

 

 

$

128,587

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

1,543

 

 

$

1,493

 

Accrued liabilities

 

 

3,574

 

 

 

5,579

 

Current portion of operating lease liabilities

 

 

1,922

 

 

 

1,803

 

Total current liabilities

 

 

7,039

 

 

 

8,875

 

Deferred tax liabilities

 

 

884

 

 

 

919

 

Other accrued liabilities

 

 

78

 

 

 

102

 

Long-term debt, net

 

 

13,178

 

 

 

13,251

 

Long-term operating lease liabilities

 

 

16,260

 

 

 

15,404

 

Total liabilities

 

 

37,439

 

 

 

38,551

 

Stockholders’ equity:

 

 

 

 

 

 

Preferred stock

 

 

 

 

 

 

Common stock

 

 

 

 

 

 

Additional paid-in capital

 

 

183,261

 

 

 

181,822

 

Accumulated deficit

 

 

(99,883

)

 

 

(91,786

)

Total stockholders’ equity

 

 

83,378

 

 

 

90,036

 

Total liabilities and stockholders’ equity

 

$

120,817

 

 

$

128,587

 

 

 

7

 


ALPHA TEKNOVA, INC.

Condensed Statements of Cash Flows

(Unaudited)

(In thousands)

 

 

 

For the Three Months Ended
March 31,

 

 

2024

 

 

2023

 

Operating activities:

 

 

 

 

 

 

Net loss

 

$

(8,097

)

 

$

(8,817

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Bad debt expense

 

 

7

 

 

 

2

 

Inventory reserve

 

 

(91

)

 

 

(144

)

Depreciation and amortization

 

 

1,636

 

 

 

1,130

 

Stock-based compensation

 

 

1,307

 

 

 

1,010

 

Deferred taxes

 

 

(35

)

 

 

(19

)

Amortization of debt financing costs

 

 

84

 

 

 

90

 

Non-cash lease expense

 

 

47

 

 

 

47

 

Loss on disposal of property, plant, and equipment

 

 

49

 

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

  Accounts receivable

 

 

(619

)

 

 

(518

)

  Inventories

 

 

478

 

 

 

240

 

  Prepaid expenses and other current assets

 

 

174

 

 

 

271

 

  Other non-current assets

 

 

117

 

 

 

102

 

  Accounts payable

 

 

133

 

 

 

(386

)

  Accrued liabilities

 

 

(1,724

)

 

 

(670

)

  Other

 

 

(24

)

 

 

(22

)

    Cash used in operating activities

 

 

(6,558

)

 

 

(7,684

)

Investing activities:

 

 

 

 

 

 

Proceeds from sale of property, plant, and equipment

 

 

125

 

 

 

 

Purchases of property, plant, and equipment

 

 

(112

)

 

 

(4,312

)

    Cash provided by (used in) investing activities

 

 

13

 

 

 

(4,312

)

Financing activities:

 

 

 

 

 

 

Proceeds from equity financing, net

 

 

(37

)

 

 

 

Repayment of financed insurance premiums

 

 

(306

)

 

 

 

Payment of at-the-market facility costs

 

 

 

 

 

(34

)

Proceeds from exercise of stock options

 

 

 

 

 

9

 

    Cash used in financing activities

 

 

(343

)

 

 

(25

)

Change in cash and cash equivalents

 

 

(6,888

)

 

 

(12,021

)

Cash and cash equivalents at beginning of period

 

 

28,484

 

 

 

42,236

 

Cash and cash equivalents at end of period

 

$

21,596

 

 

$

30,215

 

 

 

8

 


ALPHA TEKNOVA, INC.

Reconciliation of Non-GAAP Measures to the Most Comparable GAAP Measures

(Unaudited)

(In thousands)

 

 

 

For the Three Months Ended
March 31,

 

 

 

2024

 

 

2023

 

Net loss – as reported

 

$

(8,097

)

 

$

(8,817

)

Add back:

 

 

 

 

 

 

Interest (expense) income, net

 

 

(145

)

 

 

93

 

Benefit from income taxes

 

 

(34

)

 

 

(18

)

Depreciation expense

 

 

1,349

 

 

 

844

 

Amortization of intangible assets

 

 

287

 

 

 

286

 

EBITDA

 

$

(6,350

)

 

$

(7,798

)

Other and non-recurring expenses:

 

 

 

 

 

 

Stock-based compensation expense

 

 

1,307

 

 

 

1,010

 

Severance pay and other termination benefits

 

 

1,287

 

 

 

725

 

Adjusted EBITDA

 

$

(3,756

)

 

$

(6,063

)

 

 

 

For the Three Months Ended
March 31,

 

 

 

2024

 

 

2023

 

Cash used in operating activities

 

$

(6,558

)

 

$

(7,684

)

Purchases of property, plant, and equipment

 

 

(112

)

 

 

(4,312

)

Free Cash Flow

 

$

(6,670

)

 

$

(11,996

)

 

9

 


v3.24.1.1.u2
Document And Entity Information
May 13, 2024
Cover [Abstract]  
Document Type 8-K
Amendment Flag false
Document Period End Date May 13, 2024
Entity Registrant Name ALPHA TEKNOVA, INC.
Entity Central Index Key 0001850902
Entity Emerging Growth Company true
Entity Ex Transition Period false
Entity File Number 001-40538
Entity Incorporation, State or Country Code DE
Entity Tax Identification Number 94-3368109
Entity Address, Address Line One 2451 Bert Drive
Entity Address, City or Town Hollister
Entity Address, State or Province CA
Entity Address, Postal Zip Code 95023
City Area Code 831
Local Phone Number 637-1100
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $0.00001 per share
Trading Symbol TKNO
Security Exchange Name NASDAQ

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