Transcript • Mar. 11, 2026 9:00 PM • Biote Corp. Class A Common Stock (BTMD)
Transcript
Mar. 11, 2026 9:00 PM
Biote Corp. Class A Common Stock (BTMD)
Operator: Good day, and welcome to the BioT fourth quarter and full year 2025 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touch-tone phone. To withdraw your question, please press star and then two. Please note this event is being recorded. I would now like to turn the conference over to Simon Sarowiecki, Investor Relations. Please go ahead.
Simon Sarowiecki: Thank you for joining us today. This afternoon, Biotech published financial results for the fourth quarter and full year ended December 31st, 2025. This news release is available in the Investor Release section of the company's website. Hosting today's call are Brett Christensen, Chief Executive Officer, and Bob Peterson, Chief Financial Officer. Before we get started, I'd like to remind everyone that management will make statements during this call that include forward-looking statements regarding, among other things, the company's financial results, future performance and growth opportunities, business outlook, strategic plans and anticipated benefits, goals, research and development, manufacturing and commercialization activities, its competitive position, regulatory process operations, benefits of its solutions, the anticipated impact of macroeconomic conditions on the business, results of operations and financial conditions, and other matters that do not relate to historical facts. These statements are not guarantees of future performance. They are subject to a variety of risks and uncertainties, some of which are beyond the company's control. Actual results could differ materially from expectations reflected in any forward-looking statements. These statements are subject to risks, uncertainties, and assumptions that are based on management's current expectations as of today. Biotech undertakes no obligation to update them in the future. Therefore, these statements should not be relied upon as representing the company's views as of any subsequent date. For discussion of risks and other important factors that could affect their actual results, please refer to our SEC filings, available on the SEC's website and the Investor Relations section of our website, as well as risks and other important factors discussed in the earnings release. The management also refers to the EBITDA and its EBITDA margin, which are non-GAAP financial measures to provide additional information to investors. A reconciliation of the non-GAAP to GAAP measures is provided in an earnings release, with the primary differences being stock-based compensation, fair value-adjustment standard liabilities, and other non-operating expenses. Please refer to our fourth quarter 2025 earnings release for a reconciliation of these non-GAAP measures with close to comparable GAAP measures. And I'll turn the call over to Brett Christensen.
Brett Christensen: Thank you, Simon, and thank you all for joining us. I'll provide a summary of our key strategic and operational accomplishments in 2025 and and discuss our priorities in 2026. Bob will then review our fourth quarter financial results and provide our 2026 financial outlook. After our comments, we'll open the call for your questions. 2025 was a pivotal and productive year for BioT, marked by important changes to the BioT team, our processes, and our culture. Through our decisive actions, we achieved progress against our strategic plan, and I believe we became a more resilient more disciplined, and more effective organization. These qualities position BioT to drive increased and sustainable growth in the large and underserved market of hormone replacement and therapeutic wellness. As you recall, our top three strategic objectives were one, prioritizing and accelerating new clinic growth, two, maximizing value from existing top-tier clinics, and three, strengthening accountability and discipline throughout the company. I'll begin with our progress on new clinics, which are fundamental to generating consistent revenue and earnings growth over the long term. To accomplish this goal, we rebuilt a significant portion of our commercial team, recruited new leadership and talent who bring fresh energy and high performance mindset to our business. To help ensure their success, we have empowered our sales team with upgraded tools and training and designed a new incentive compensation framework that aligns with our high growth objectives. We also completed the restructuring of our commercial team, both by geographic region and by sales role. This new structure has two key advantages. One, it enables us to provide a higher level of service to our existing accounts. And two, it allows for us to remain laser focused on driving new clinic growth and optimizing new practitioner success. We ended 2025 with over 90 salespeople, up from approximately 60 at the time of our sales reorganization last May. I'm pleased to report that our new team members are stabilizing clinic attrition and maximizing new clinic starts in the fourth quarter. In addition, from mid-November to present, we have seen an acceleration in the number of practitioners attending our trainings, with all of our training sessions at full capacity. This reflects our recent success in recruiting new practitioners and broadening our training options for them. Because the number of new BioT certified practitioners is typically a leading indicator of procedure growth in the future, we plan to build on this momentum by continuing to invest in our commercial organization in 2026. Our second strategic objective was to maximize value from our top tier clinics. To accomplish this, we deepened our relationships with existing practitioners, which reinforced our role as an essential partner that is committed to their success. Second, we continue to introduce innovative science-based solutions that promote patient healthspan and vitality and advance the standard of care. And third, to minimize unanticipated clinic attrition, we leverage data analytics to evaluate refined contract and incentive models that strengthen the longer-term value equation of our top practitioners. Turning now to our third strategic objective, we emphasize accountability and discipline in our pursuit of operational excellence. Most importantly, we've strengthened and refined the internal processes and systems that underpin our operating model. These enhancements improved our data analytics and productivity, enabling a more consistent execution. Having strengthened our core capabilities, I am cautiously optimistic we will reaccelerate procedure revenue growth and scale the business with greater efficiency. I'd now like to comment on our strategic plans for 2026. Over the past year, we've laid the groundwork for a more efficient and more disciplined operating model, one that positions us to deliver stronger and more consistent financial performance in the years ahead. In 2026, we will focus on advancing the progress we achieved in 2025. For example, we will be making a sizable and necessary investment in our sales and technology capabilities. Specifically, we intend to expand our sales personnel from over 90 at the end of 2025 to approximately 120. Concurrent with this investment in our commercial team, we will be investing in our leading-edge technology platform in 2026. This investment is designed to facilitate a more efficient and seamless practitioner journey from initial training and certification to driving a successful BioT clinic over the long term. We also anticipate that this investment will enhance long-term practitioner retention while expanding sales of our BioT branded dietary supplements and other healthy aging solutions. I am confident now is the right time to make these investments, which we believe are essential to accelerate growth, expand our market opportunity, and further enhance engagement with existing practitioners. While this step up in expenses will impact our adjusted EBITDA in 2026, We believe these planned investments position our team to reach our long-term strategic operational and financial objectives. I'll now turn the call over to Bob to review our fourth quarter results and provide our financial guidance for 2026.
Bob Peterson: Thank you, Brett, and good afternoon, everyone. Unless otherwise noted, all quarterly financial comparisons in my prepared remarks are made against the fourth quarter of 2024. Fourth quarter revenue was $46.4 million, a decrease of 6.9%. Procedure revenue declined 13% to $31.8 million, while dietary supplement revenue grew 16% to $11.7 million. Similar to recent quarters, procedure revenue was primarily impacted by a lower number of net new clinic additions and lower procedure volume during the fourth quarter of 2025. As Brett noted, in 2026, we anticipate increasing our investment in our sales capabilities to capture a larger share of our available market opportunity. Dietary supplement revenue increased 16% to $11.7 million, primarily driven by the continued growth of our e-commerce channel. Dietary supplements represent an important and complimentary market growth opportunity, strengthening patient engagement with BioT by meeting their evolving needs for safe and effective healthy aging solutions. Looking forward, we forecast our dietary supplements revenue will grow at a mid to high single digit rate in 2026. Gross profit margin was 68%. compared to 71.8%. The decrease was due to a $1.3 million charge to inventory during the fourth quarter of 2025 as a result of the impact of a voluntary recall of specific lots of hormone pellets shipped by Asteria Health. We could see a potential near-term impact to gross margin if our product mix includes more third-party manufacturing. Our long-term goal is to meet customer needs through our Asteria site. Excluding this charge, gross margin reflected the benefit of efficiencies gained from vertical integration of our 503 manufacturing facility and effective cost management. General and administrative expenses decreased 25.1% to $24.7 million. The decrease reflected lower legal expense and a temporary decrease in headcount. Net income was $2.6 million, and diluted earnings per share attributed to BioT Corp stockholders was 6 cents. Compared to net income of $3.5 million, and diluted earnings per share attributed to BioT Corp stockholders of 10 cents. Net income for the fourth quarter of 2025 included a gain of $1.2 million due to changes in the fair value of the earn-out liabilities. Net income for the fourth quarter of 2024 included a loss of $0.8 million due to changes in the fair value of the earn-out liabilities. Adjusted EBITDA decreased to $11.7 million with an adjusted EBITDA margin of 25.2%. This compares to adjusted EBITDA of $15.1 million and adjusted EBITDA margin of 30.3%. Both adjusted EBITDA and adjusted EBITDA margin decreased due to lower sales and reduced gross profits. partially offset by lower operating expenses as a result of our sales reorganization. For the 2025 year, cash flow from operations was $35.2 million. As of December 31st, 2025, cash and cash equivalents were $24.1 million. Now turning to our financial outlook for 2026. As previously mentioned, we anticipate investing to advance our sales and technology capabilities. While this planned investment will cause a step up in operating expenses in the near term, we expect the benefit will be evidenced by an improvement in our procedure revenue expected to start in the second half of 2026. With respect to our 2026 revenue guidance, year-on-year procedure revenue is expected to decrease at a mid to high single-digit percentage rate in the first half of 2026, which includes a potential revenue and profit impact related to the recall. We anticipate an expected return to year-on-year procedure growth in the second half of 2026. Dietary supplement revenue is expected to grow at a mid to high single-digit rate from 2025. Overall, we forecast 2026 revenues above $190 million and adjusted EBITDA of greater than $38 million. I'll now turn the call back to Brett for his closing remarks.
Brett Christensen: Thanks, Bob. I'm pleased with the progress the entire BioT team has achieved in the past year. We laid much of the foundational groundwork that I believe will enable us to drive a higher and more consistent level of financial performance. Our planned investments in 2026 represent a key inflection point for BioT that I believe are essential to effectively address our large market opportunity and build long-term sustainable shareholder value. Operator, let's now open the call for questions.
Operator: Thank you. We will now begin the question and answer session. To ask a question, you may press star, then 1 on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star and then 2. At this time, we will pause momentarily to assemble our roster. The first question will come from Les Suluski with Truist Securities. Please go ahead.
Jeevan: Hey, this is Jeevan on for Les. Thanks for taking our questions. What's your take on the FDA's removal of black box warnings for certain HRTs and maybe how this could potentially impact demand? And then also for the voluntary recall, can you elaborate on any FDA feedback and, you know, whether you see this event changing the regulatory bar or competitive dynamics in the space?
Brett Christensen: Yeah. Hi, this is Brett. Thanks for the question. First on the black box warning that was removed now really almost, you know, just a little less than a year ago. That along with, you know, the entire talk track of the FDA seems to be a positive tailwind for us and others. It's a good sign that finally hormone optimization is getting recognized as a great option. It's always been a good option for men and women are getting the the attention that they deserve is there are still no FDA-approved options for women for testosterone therapy. So all in all, it's a great thing for us. It reinforces what we've known is that there's no harm that comes from testosterone and a tremendous amount of benefit that patients can get through different modalities of HRT. So it's a good thing, and we look for continued support from clinicians and patients alike for awareness. As far as the recall goes, as you know, at the end of January, we announced a partial recall, voluntary recall that we're doing just out of an abundance of caution, working hand in hand with the FDA. So the feedback has been good. You know, we are working hand in hand with the FDA on almost everything that we do. So communication to our customers, taking the product back, refilling those orders. All of that has been done in a planning with the FDA, so we are lockstep with their guidance in this entire recall. Our customers have been responsive, and we're happy with where we're at so far.
Operator: The next question will come from Caitlin Corrick with Jefferies. Please go ahead.
Caitlin Corrick: Hi, everyone. Good evening. Thanks for taking my question. I just wanted to drill into the procedure revenue growth in the first half, and is it purely the number of procedures that will be done while the number of practitioners are ticking higher? Or is there also some element of promos or discounting that we should be considering? Any color there, and also if anything's changed in the competitive environment would be helpful. Thank you.
Brett Christensen: Yeah. Hi, Caitlin. This is Brett. I'll start with that, and Bob can add some specifics. You know, throughout last year, we highlighted an increase in attrition. And for us, when we talk about attrition, we are talking about practitioner and clinic attrition. And so while that's been stable for us for years at around 5%, last year we highlighted that that accelerated to high single digits. And so that's where we've exited the year in 2024. The lower volume that we're highlighting in 2026 in the first half until we return to growth in the second half really is just that same attrition that we've experienced at a higher rate in the past. Remember, with an annuity model, we live with that attrition for 12 months. So attrition was higher last year, and mostly that was clinic attrition. which does mean lower volumes. So that's where we exited the year. We anticipate that that will change this year, and we will return to growth in the second half through volume growth. But the majority of that lower procedure revenue was volume.
Bob Peterson: That's right. And I think the only other thing to add there is, as Brett mentioned, we are in the process now of watching some of those new customers that are coming in the door. And wanting to see, he highlighted in the remarks that trainings were full. We'll need to continue to watch those individuals to make sure that they are productive and start quickly. And I can't stress enough, we're in the, you know, we're about a month, month and a half into the recall. And we just want to continue to monitor the impacts there also. So I think that gives a little bit of additional color.
