NEW YORK – Twist Bioscience reported after the close of the market on Thursday that its first quarter revenues in fiscal year 2020 increased 49 percent year over year.
Separately, the firm announced that it had reached a settlement agreement with Agilent Technologies over an intellectual property lawsuit Agilent had filed in 2016. Earlier in the day, speculation about an impending settlement had led to a sharp rise in Twist's share price.
"We're off to a solid start" with strong revenues resulting from a large number of orders shipping near the end of the quarter, said Twist CEO and Cofounder Emily Leproust in a conference call to discuss the financial results.
Under the term of the litigation settlement, Twist is making a one-time $22.5 million payment to Agilent, obtaining in exchange a full relief of claims against the defendants. "The settlement agreement contains no admission of liability or wrongdoing, because there were none," Leproust said. "Agilent launched an all-out legal assault on Twist and in the end, we not only survived, we thrived through the attack."
Twist expects to recognize a one-time charge relating to the settlement in the quarter ending March 31, and the suit is expected to be formally dismissed later this month.
For the three months ended Dec. 31, 2019, Twist reported $17.2 million in revenues, up from $11.5 million during the same quarter a year ago and beating the average analyst estimate of $16.1 million, as well as Twist's own guidance of $15 million to $16.5 million.
Synthetic biology revenues, which include genes, libraries, and oligo pools, totaled $10 million in Q1, with $7.8 million from genes, which included $2.1 million from Ginkgo Bioworks. The company shipped 80,000 genes during the quarter, with longer genes above 1.8 kb in size accounting for more than 30 percent of genes revenue.
NGS revenues were $7 million, up 84 percent from $3.8 million during the year-ago quarter, and Twist shipped products to almost 190 NGS customers.
Twist saw "really strong growth outside the US," CFO Jim Thorburn said during the call, with $10 million of revenues, about 60 percent, coming from the Americas, while EMEA revenue grew to $5.9 million and APAC revenue grew to $1.2 million.
The largest business segment was industrial chemistry, with $6.1 million in revenues, followed by healthcare, with $5.8 million revenues. Healthcare and academic research were the two segments with the largest year-over-year growth, driven by synbio and NGS products, he said.
In total, the company shipped products to about 1,000 customers during the quarter, compared to about 600 during the year-ago quarter.
Leproust said that while Twist is providing products to customers studying the new coronavirus involved in the current global outbreak, it doesn't expect a bump in revenues as a result. "While we do not want to minimize the gravity of the situation, this is what we do each and every day, and the orders coming in fit within our regular workflow," she said.
Twist also completed an offering of approximately 2.24 million shares of its common stock in Q1, raising about $48.2 million in net proceeds.
For Q1, the company booked a net loss of $55.6 million, or $1.69 per share, compared to $22.6 million, or $1.18 per share, in Q1 of FY2019. This included the 22.5 million litigation settlement expense. Excluding that, net loss totaled $33.1 million, or $1.00 per share, above the average analyst estimate of a net loss of $.83 per share.
Twist's R&D expenses totaled $10.3 million in the quarter, up 41 percent from $7.3 million in Q1 of FY2019. SG&A expenses climbed to $26.4 million, up 73 percent from $15.3 million during the year-ago quarter.
As of Dec. 31, the company had $26.0 million in cash and cash equivalents, and $77.1 million in short-term investments.
Twist amended its guidance for net loss in fiscal year 2020. Excluding the litigation settlement, it now expects a net loss between $107 million and $110 million, compared to a previous $103 million to $106 million. The increase is related to legal fees associated with the now-settled Agilent litigation. Including the litigation settlement, the company's net loss is estimated to range from $129.5 million to $132.5 million.
Twist maintained its revenue guidance of $80 million to $84 million for fiscal year 2020. NGS revenue is estimated to be in the range of $37 million to $40 million, synbio revenue excluding Ginkgo Bioworks is expected to be $32 million to $33 million, Ginkgo Bioworks revenue about $10 million, and biopharma revenue about $1.0 million.
In morning trading on the Nasdaq, Twist shares were up 2 percent at $31.74.