Cambrex Corporation. (NYSE:CBM) Q1 2018 Earnings Conference Call - Final Transcript

May 03, 2018 • 08:30 am ET

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Cambrex Corporation. (NYSE:CBM) Q1 2018 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, good day and welcome to the Cambrex First Quarter 2018 Earnings Conference Call. [Operator Instructions]. At this time, I would like to turn the conference over to Mr. Tom Vadaketh. Mr. Vadaketh, please go ahead, sir.

Executive
Tom Vadaketh

Thank you, David, and good morning, everyone. Welcome to Cambrex's First Quarter 2018 Earnings Conference Call. My name is Tom Vadaketh, and I am the Chief Financial Officer at Cambrex. Today's discussion will contain forward-looking statements regarding expected operational and financial performance, and these statements may occur during our prepared remarks or during the question-and-answer session. These statements are based on Cambrex's current expectations and involve risks and uncertainties that could cause actual outcomes and results to materially differ from those included in the forward-looking statements.

For further information regarding such risks and uncertainties, please refer to the risk factors and forward-looking statements portions of our 2017 Form 10-K as well as the forward-looking statements section in both our first quarter 2018 Form 10-Q and the earnings release issued this morning.

During this call, we will be referring several times to changes in revenue, all of which are made on a constant currency basis. Also during this call, to provide greater transparency regarding Cambrex's operating performance, we refer to certain non-GAAP financial measures that are reconciled to the most directly comparable GAAP financial measure in a table at the end of our earnings press release, issued this morning and available on our website at cambrex.com.

A replay of the call will be available shortly after we end today through next Thursday, May 10, and will also be available on the Investors section of our website. Today's call will begin with the business review by Steve Klosk, our President and CEO. I'll follow Steve with comments on our financial results before opening the call for Q&A.

With that, it's my pleasure to introduce Steve Klosk. Steve.

Executive
Steve Klosk

Thank you, Tom, and good morning, ladies and gentlemen. Our first quarter performance was in line with our expectations, and we are on track to meet our full year 2018 guidance. We added two new late stage Innovator projects to our pipeline, both with the potential to generate more than $10 million in peak API sales. And customer demand for new projects remains robust. To meet this strong demand for both early and late stage clinical development and manufacturing services, we continue to invest for growth. And in the first quarter, we made good progress on and several of our capacity expansion projects.

I'll begin today by commenting on our consolidated first quarter financial results and expectations for 2018. All references to revenues and EBITDA that I will make will be under the prior US GAAP recognition standard. Tom will cover our 2018 transition to the new standard during his remarks. Net revenue in the first quarter was $104 million compared to $105 million during the first quarter last year, a 5% decrease on a constant currency basis.

Higher revenue in the Innovator product category was offset