Cryoport, Inc. [CYRX] Filings

10-Q 1 cyrx-20220930x10q.htm 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______.

Commission File Number: 001-34632

CRYOPORT, INC.

(Exact Name of Registrant as Specified in its Charter)


Nevada	88-0313393
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

112 Westwood Place, Suite 350

Brentwood, TN 37027

(Address of principal executive offices, including zip code)

(949) 470 2300

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

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, $0.001 par value		CYRX		The Nasdaq Stock Market LLC (The Nasdaq Capital Market)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
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. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of October 28, 2022 there were 48,999,839 shares of the registrant’s common stock outstanding.

Table of Contents

TABLE OF CONTENTS


	Page

PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements

Condensed Consolidated Balance Sheets at September 30, 2022 (Unaudited) and December 31, 2021	3

Unaudited Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2022 and 2021	4

Unaudited Condensed Consolidated Statements of Comprehensive Loss for the three and nine months ended September 30, 2022 and 2021	5

Unaudited Condensed Consolidated Statements of Stockholders’ Equity for the three and nine months ended September 30, 2022 and 2021	6

Unaudited Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2022 and 2021	7

Notes to Condensed Consolidated Financial Statements (Unaudited)	8

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	37

ITEM 3. Quantitative and Qualitative Disclosures About Market Risk	51

ITEM 4. Controls and Procedures	52

PART II. OTHER INFORMATION	52

ITEM 1. Legal Proceedings	52

ITEM 1A. Risk Factors	52

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds	55

ITEM 3. Defaults Upon Senior Securities	56

ITEM 4. Mine Safety Disclosures	56

ITEM 5. Other Information	56

ITEM 6. Exhibits	56

SIGNATURES	57

Table of Contents

Cryoport, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(in thousands, except share data)


	September 30,		December 31,
	2022		2021
	(unaudited)
ASSETS
Current Assets:
Cash and cash equivalents	$	30,724	$	139,101
Short-term investments		498,801		489,698
Accounts receivable, net		44,419		39,412
Inventories		24,542		16,501
Prepaid expenses and other current assets		10,639		8,804
Total current assets		609,125		693,516
Property and equipment, net		57,680		49,029
Operating lease right-of-use assets		24,820		20,675
Intangible assets, net		192,140		201,427
Goodwill		147,458		146,954
Deposits		926		950
Deferred tax assets		1,642		419
Total assets	$	1,033,791	$	1,112,970

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable and other accrued expenses	$	27,441	$	28,583
Accrued compensation and related expenses		8,625		9,912
Deferred revenue		549		547
Current portion of operating lease liabilities		3,007		3,542
Current portion of notes payable		1,010		—
Current portion of finance lease liabilities		96		61
Total current liabilities		40,728		42,645
Convertible senior notes, net		406,071		404,171
Notes payable, net		351		1,086
Operating lease liabilities, net of current portion		23,112		18,144
Finance lease liabilities, net of current portion		171		51
Deferred tax liability		3,037		4,018
Other long-term liabilities		455		298
Contingent consideration		4,145		729
Total liabilities		478,070		471,142

Commitments and contingencies
Stockholders’ Equity:
Preferred stock, $0.001 par value; 2,500,000 shares authorized:
Class A convertible preferred stock — $0.001 par value; 800,000 shares authorized; none issued and outstanding		—		—
Class B convertible preferred stock — $0.001 par value; 585,000 shares authorized; none issued and outstanding		—		—
Class C convertible preferred stock, $0.001 par value; 250,000 shares authorized; 200,000 issued and outstanding		16,275		10,275
Common stock, $0.001 par value; 100,000,000 shares authorized; 48,558,431 and 49,616,154 issued and outstanding at September 30, 2022 and December 31, 2021, respectively		49		50
Additional paid-in capital		1,086,112		1,100,287
Accumulated deficit		(503,787)		(467,541)
Accumulated other comprehensive loss		(42,928)		(1,243)
Total stockholders’ equity		555,721		641,828
Total liabilities and stockholders’ equity	$	1,033,791	$	1,112,970

See accompanying notes to condensed consolidated financial statements.

Table of Contents

Cryoport, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(in thousands, except share and per share data)

(unaudited)


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
Service revenues	$	33,296	$	30,899	$	100,791	$	87,342
Product revenues		27,168		25,794		76,128		78,826
Total revenues		60,464		56,693		176,919		166,168

Cost of service revenues		18,913		18,114		56,742		50,409
Cost of product revenues		15,134		15,066		42,581		42,295
Total cost of revenues		34,047		33,180		99,323		92,704
Gross margin		26,417		23,513		77,596		73,464

Operating costs and expenses:
Selling, general and administrative		30,235		23,901		87,420		69,977
Engineering and development		3,985		4,188		11,045		12,953
Total operating costs and expenses		34,220		28,089		98,465		82,930

Loss from operations		(7,803)		(4,576)		(20,869)		(9,466)
Other income (expense):
Investment income		2,485		851		5,797		1,618
Interest expense		(1,609)		(1,189)		(4,686)		(3,563)
Other income (expense), net		1,668		(588)		(7,377)		(1,469)
Total other expense, net		2,544		(926)		(6,266)		(3,414)
Loss before provision for income taxes		(5,259)		(5,502)		(27,135)		(12,880)
Provision for income taxes		(57)		(1,024)		(762)		(2,562)
Net loss	$	(5,316)	$	(6,526)	$	(27,897)	$	(15,442)
Paid-in-kind dividend on Series C convertible preferred stock		(2,000)		(2,000)		(6,000)		(6,196)
Net loss attributable to common stockholders	$	(7,316)	$	(8,526)	$	(33,897)	$	(21,638)
Net loss per share - basic and diluted	$	(0.15)	$	(0.18)	$	(0.69)	$	(0.48)
Weighted average shares outstanding – basic and diluted		48,520,696		46,137,147		49,148,558		45,220,319

See accompanying notes to condensed consolidated financial statements.

Table of Contents

Cryoport, Inc. and Subsidiaries

Condensed Consolidated Statements of Comprehensive Loss

(in thousands)


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
Net loss	$	(5,316)	$	(6,526)	$	(27,897)	$	(15,442)
Other comprehensive loss, net of tax:
Net unrealized loss on available-for-sale debt securities		(6,537)		(384)		(25,912)		(1,544)
Reclassification of realized (gain) loss on available-for-sale debt securities to earnings		—		(31)		46		7
Foreign currency translation adjustments		(7,215)		(512)		(15,819)		(3,666)
Other comprehensive loss		(13,752)		(927)		(41,685)		(5,203)
Total comprehensive loss	$	(19,068)	$	(7,453)	$	(69,582)	$	(20,645)

See accompanying notes to condensed consolidated financial statements.

Table of Contents

Cryoport, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders’ Equity

(In thousands, except share data)


																	Other
	Class A			Class B			Class C										Comprehensive		Total
	Preferred Stock			Preferred Stock			Preferred Stock			Common Stock			Additional		Accumulated		Income		Stockholders’
	Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount		Paid–In Capital		Deficit		(Loss)		Equity (Deficit)
Balance at June 30, 2021	—		—	—		—	200,000		6,275	45,892,448		46		841,537		(200,929)		1,100		648,029
Net loss	—		—	—		—	—		—	—		—		—		(6,526)		—		(6,526)
Other comprehensive loss, net of taxes	—		—	—		—	—		—	—		—		—		—		(927)		(927)
Stock-based compensation expense	—		—	—		—	—		—	—		—		4,148		—		—		4,148
Paid-in-kind preferred stock dividend, including beneficial conversion feature	—		—	—		—	—		2,000	—		—		(2,000)		—		—		—
Proceeds from exercise of stock options	—		—	—		—	—		—	315,118		—		2,502		—		—		2,502
Balance at September 30, 2021	—	$	—	—	$	—	200,000	$	8,275	46,207,566	$	46	$	846,187	$	(207,455)	$	173	$	647,226

Balance at June 30, 2022	—		—	—		—	200,000		14,275	48,482,502		49		1,081,747		(498,471)		(29,176)		568,424
Net loss	—		—	—		—	—		—	—		—		—		(5,316)		—		(5,316)
Other comprehensive loss, net of taxes	—		—	—		—	—		—	—		—		—		—		(13,752)		(13,752)
Stock-based compensation expense	—		—	—		—	—		—	—		—		5,366		—		—		5,366
Paid-in-kind preferred stock dividend	—		—	—		—	—		2,000	—		—		(2,000)		—		—		—
Vesting of restricted stock units	—		—	—		—	—		—	4,500		—		—		—		—		—
Proceeds from exercise of stock options	—		—	—		—	—		—	71,429		—		999		—		—		999
Balance at September 30, 2022	—	$	—	—	$	—	200,000	$	16,275	48,558,431	$	49	$	1,086,112	$	(503,787)	$	(42,928)	$	555,721

Balance at December 31, 2020	—		—	—		—	250,000		2,844	39,837,058		40		566,451		(192,013)		5,376		382,698
Net loss	—		—	—		—	—		—	—		—		—		(15,442)		—		(15,442)
Other comprehensive loss, net of taxes	—		—	—		—	—		—	—		—		—		—		(5,203)		(5,203)
Stock-based compensation expense	—		—	—		—	—		—	—		—		11,151		—		—		11,151
Issuance of common stock for board of director compensation	—		—	—		—	—		—	229		—		11		—		—		11
Cost of Series C preferred stock conversion	—		—	—		—	—		—	—		—		(1,800)		—		—		(1,800)
Issuance of common stock in public offering, net of costs of $17.7 million	—		—	—		—	—		—	4,356,059		4		269,821		—		—		269,825
Conversion of Series C preferred shares to common stock	—		—	—		—	(50,000)		(765)	1,312,860		1		764		—		—		—
Paid-in-kind preferred stock dividend, including beneficial conversion feature	—		—	—		—	—		6,196	—		—		(6,196)		—		—		—
Proceeds from exercise of stock options and warrants	—		—	—		—	—		—	701,360		1		5,985		—		—		5,986
Balance at September 30, 2021	—	$	—	—	$	—	200,000	$	8,275	46,207,566	$	46	$	846,187	$	(207,455)	$	173	$	647,226

Balance at December 31, 2021	—		—	—		—	200,000		10,275	49,616,154		50		1,100,287		(467,541)		(1,243)		641,828
Net loss	—		—	—		—	—		—	—		—		—		(27,897)		—		(27,897)
Other comprehensive loss, net of taxes	—		—	—		—	—		—	—		—		—		—		(41,685)		(41,685)
Stock-based compensation expense	—		—	—		—	—		—	—		—		14,749		—		—		14,749
Paid-in-kind preferred stock dividend	—		—	—		—	—		6,000	—		—		(6,000)		—		—		—
Issuance of common stock for Cell&Co acquisition	—		—	—		—	—		—	15,152		—		479		—		—		479
Repurchase of common stock	—		—	—		—	—		—	(1,341,571)		(1)		(24,999)		(8,349)		—		(33,349)
Vesting of restricted stock units	—		—	—		—	—		—	97,062		—		—		—		—		—
Proceeds from exercise of stock options	—		—	—		—	—		—	171,634		—		1,596		—		—		1,596
Balance at September 30, 2022	—	$	—	—	$	—	200,000	$	16,275	48,558,431	$	49	$	1,086,112	$	(503,787)	$	(42,928)	$	555,721

See accompanying notes to condensed consolidated financial statements.

Table of Contents

Cryoport, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(unaudited, in thousands)


	For the Nine Months Ended
	September 30,
	2022		2021
Cash Flows From Operating Activities:
Net loss	$	(27,897)	$	(15,442)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		16,631		14,944
Amortization of debt discount		1,930		736
Unrealized loss on investments in equity securities		12,436		308
Realized loss on available-for-sale investments		113		77
Stock-based compensation expense		14,749		11,163
Loss on disposal of property and equipment		574		125
Provision for bad debt		13		263
Excess and obsolete inventory		546		—
Gain on insurance settlement		(4,815)		—
Insurance proceeds for operations		6,429		—
Contingent consideration		145		—
Changes in operating assets and liabilities:
Accounts receivable		(8,307)		(6,564)
Inventories		(11,179)		(2,980)
Prepaid expenses and other current assets		(1,419)		2,722
Deposits		9		210
Change in operating lease right-of-use assets and lease liabilities		316		303
Accounts payable and other accrued expenses		(3,172)		(2,334)
Accrued compensation and related expenses		(1,218)		1,245
Deferred revenue		(420)		(137)
Deferred tax (asset) liability

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10-Q	[2022-05-05]
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10-Q	[2021-08-06]
10-Q	[2021-05-06]
10-K	[2021-03-01]
10-Q	[2020-11-06]
10-Q	[2020-08-10]
10-Q	[2020-05-08]
10-K	[2020-03-10]
10-Q	[2019-11-12]
10-Q	[2019-08-09]
10-Q	[2019-05-09]
10-K	[2019-03-13]
10-Q	[2018-11-08]
10-Q	[2018-08-09]
10-Q	[2018-05-03]
10-K	[2018-03-08]
10-Q	[2017-11-02]
10-Q	[2017-08-09]
10-Q	[2017-05-04]
10-Q	[2016-11-14]
10-Q	[2016-08-15]
S-1	[2016-06-30]
10-K	[2016-06-28]
S-1	[2016-04-28]
10-Q	[2016-02-11]
10-Q	[2015-11-16]
10-Q	[2015-08-06]
10-K	[2015-05-19]
S-1	[2015-03-25]
10-Q	[2015-02-05]
10-Q	[2014-11-12]
10-Q	[2014-07-31]
10-K	[2014-06-25]
10-Q	[2014-02-13]
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10-Q	[2013-08-14]
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