(MENAFN- PR Newswire) Ginkgo added 21 new Cell Programs to the Foundry platform in Q2 2023
Highlighted continued success selling into large established biotech R&D organizations with recently expanded relationships with Sumitomo, Novo Nordisk, and Merck
Ginkgo ended Q2 2023 with approximately $1.1 billion in cash and cash equivalents, providing a strong multi-year runway as Ginkgo continues to drive towards profitability
BOSTON, Aug. 9, 2023 /PRNewswire/ -- Ginkgo Bioworks Holdings, Inc. (NYSE: dna , "Ginkgo"), which is building the leading platform for cell programming and biosecurity, today announced its results for the second quarter ended June 30, 2023. The update, including a webcast slide presentation with additional details on the second quarter and supplemental financial information, will be available at
investors.ginkgobioworks.com .
"I'm really energized by the work that we have done at Ginkgo this past quarter," said Jason Kelly, co-founder and CEO of Ginkgo. "This has been a record quarter on several dimensions, we launched more programs than we ever have before and are seeing strong output from our Foundry.
While we still have much more to do, many of the investments we have made to make biology more like an engineering discipline are paying off.
This is being reflected not only in our output but also in the outcomes we're delivering for our partners, and we're honored to have more and more technically sophisticated customers trusting Ginkgo to manage their R&D efforts."
Recent Business Highlights & Strategic Positioning
Added 21 new Cell Programs to the Foundry platform in Q2 2023, representing 62% growth over the prior year period In addition to bringing new customers onto the platform, Ginkgo progressed and/or expanded several partnerships with market leading companies including Sumitomo, Novo Nordisk, and Merck
Ginkgo's Cell Engineering segment generated services revenue, which does not include downstream value share revenue, of $44 million, a 72% increase versus the second quarter of 2022 Ginkgo's Biosecurity segment generated $35 million of revenue in the second quarter. As the COVID-19 public health emergency came to an end in the United States during the quarter, Biosecurity revenue continues to shift away from COVID-19 testing programs in schools and communities towards a more recurring model focused on long-term biosecurity infrastructure Concentric continues to expand internationally, with partnerships in 10 countries outside the U.S., including a
recently announced Memorandum of Understanding in Panama, our first partnership in Latin America and a key international hub
Across both segments, Ginkgo continues to advance its relationships with the US government and has been recently awarded contracts from the Intelligence Advanced Research Projects Agency (IARPA) and the Defense Advanced Research Projects Agency (DARPA) to develop improvements in biosecurity and biomanufacturing, in addition to ongoing biosecurity work with the US Centers for Disease Control and Prevention (CDC)
Appointment of Shyam Sankar as Chair of Ginkgo's Board of Directors
Shyam Sankar, who has served on Ginkgo's board of directors since 2015, has been unanimously appointed Chair of Ginkgo's board. Mr. Sankar is the Chief Technology Officer at Palantir Technologies
and brings a wealth of experience in key technology and growth areas for Ginkgo, including artificial intelligence and government partnerships. Marijn Dekkers, who has served as Ginkgo's Chair since joining the board in 2019, will remain an active director on the board.
"We are so excited to have Shyam step into this leadership position on our board as we see real opportunities in areas in which he's a world expert, including artificial intelligence," said Jason Kelly, co-founder and CEO of Ginkgo. "Shyam has been extremely helpful over the last eight years of tremendous growth, and we look forward to his guidance and leadership as he steps into this new role. Shyam is building on the strong foundation Marijn has built.
I'm extremely grateful for Marijn's leadership and partnership throughout his tenure as Chair and look forward to continued collaboration as he continues in a director role. We look forward to working with both Shyam and Marijn in Ginkgo's next phase of growth."
Second Quarter 2023 Financial Highlights
Second quarter 2023 Total revenue of $81 million, down from $145 million in the comparable prior year period, a decrease of 44% primarily driven by the expected ramp down of K-12 testing in Ginkgo's Biosecurity segment Second quarter 2023 Cell Engineering revenue of $45 million, up from $44 million in the comparable prior year period Cell Engineering services revenue, which does not include downstream value share revenue, increased by 72% in the second quarter of 2023 compared to the prior year period
Second quarter 2023 Biosecurity revenue of $35 million with gross profit margin of 49% Second quarter 2023 Loss from operations of $(184) million (inclusive of stock-based compensation expense of $62 million), compared to Loss from operations of $(648) million in the comparable prior year period (inclusive of stock-based compensation expense of $607 million). The stock-based compensation expense primarily relates to the continued GAAP accounting for the modification of restricted stock units issued prior to Ginkgo becoming a public company, as disclosed in our annual report on Form 10-K filed with the SEC on March 13, 2023, and which we expect will continue to ramp down significantly in the second half of 2023 Second quarter 2023 Adjusted EBITDA of $(75) million, down from $(24) million in the comparable prior year period driven by both the higher run-rate of expenses in Cell Engineering and the as-expected decline in Biosecurity revenue Cash and cash equivalents balance as of the end of the second quarter of approximately $1.1 billion puts Ginkgo in a strong financial position to pursue its strategic objectives
Full Year 2023 Outlook
Ginkgo is targeting 100 new Cell Programs to the Foundry platform in 2023 Ginkgo is expecting Total revenue of $245 to $260 million in 2023 Ginkgo revised its expectation for Cell Engineering revenue to $145 to $160 million in 2023. This guidance excludes the impact of any downstream value share revenue. This revision is driven by an evolution in the typical size and structure of our contracts, including success-based pricing which is impacting the timing of revenue recognition. The flexibility we're able to provide to customers during an ongoing challenging environment, particularly for industrial biotechnology, is a key part of our value proposition. While Biosecurity remains an uncertain business, Ginkgo continues to expect Biosecurity revenue in 2023 of at least $100 million, including a mix shift towards emerging product lines that are expected to be more recurring in nature, such as federal and international partnerships supporting pathogen monitoring and biosecurity infrastructure development
Conference Call Details
Ginkgo will host a videoconference today, Wednesday, August 9, 2023, beginning at 5:30 p.m. ET. The presentation will include an overview of the second quarter financial performance, recent business updates, a discussion on Ginkgo's outlook, as well as a moderated question and answer session.
To ask a question ahead of the presentation, please submit your questions to
@ginkgo
on X (the social network formerly known as Twitter) (hashtag #GinkgoResults) or by sending an e-mail to
[email protected] .
A webcast link is available on ginkgo's investor relations website
and a replay will be made available following the presentation.
Ginkgo Investor Website:
Audio-Only Dial Ins:
+1 646 876 9923 (New York)
+1 301 715 8592 (Washington DC)
+1 312 626 6799 (Chicago)
+1 669 900 6833 (San Jose)
+1 253 215 8782 (Tacoma)
+1 346 248 7799 (Houston)
+1 408 638 0968 (San Jose)
Webinar ID: 914 4736 3590
If you experience technical difficulties with any of these dial-ins or if you need international dial-in numbers, please visit our web site at for updated dial-in information.
About Ginkgo Bioworks
Ginkgo Bioworks is the leading horizontal platform for cell programming, providing flexible, end-to-end services that solve challenges for organizations across diverse markets, from food and agriculture to pharmaceuticals to industrial and specialty chemicals. Ginkgo's biosecurity and public health unit, Concentric by Ginkgo, is building global infrastructure for biosecurity to empower governments, communities, and public health leaders to prevent, detect and respond to a wide variety of biological threats. For more information, visit ginkgobioworks.com
and concentricbyginkgo.com , read our blog , or follow us on social media channels such as X (the social network formerly known as Twitter) (@ginkgo
and @concentricbygbw ), Instagram (@ginkgobioworks
and @concentricbyginkgo ), Threads (@GinkgoBioworks) or linkedin .
Forward-Looking Statements of Ginkgo Bioworks
This press release, the presentation, and the conference call and webcast contain certain forward-looking statements within the meaning of the federal securities laws, including statements regarding our plans, strategies, including with respect to our balance sheet and cash runway, acquisitions, current expectations, operations and anticipated results of operations, both business and financial, including opportunities for increased operational efficiency, potential customer success, including successful application of our offerings by our customers, expectations with regard to revenue, the nature of such revenue and any related downstream value share associated with such revenue, expenses, including our stock-based compensation expenses, our full year 2023 outlook, and the market environment, all of which are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements, market trends, or industry results to differ materially from those expressed or implied by such forward-looking statements. These forward-looking statements generally are identified by the words "believe," "can," "project," "potential," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this document, including but not limited to: (i) volatility in the price of Ginkgo's securities due to a variety of factors, including changes in the competitive and highly regulated industries in which Ginkgo operates and plans to operate, variations in performance across competitors, and changes in laws and regulations affecting Ginkgo's business, (ii) the ability to implement business plans, forecasts, and other expectations, and to identify and realize additional business opportunities, (iii) the risk of downturns in demand for products using synthetic biology, (iv) the uncertainty regarding the demand for passive monitoring programs and biosecurity services, (v) changes to the biosecurity industry, including due to advancements in technology, emerging competition and evolution in industry demands, standards and regulations, (vi) our ability to realize the expected benefits of merger and acquisition transactions, (vii) the outcome of any legal proceedings against Ginkgo, including as a result of recent acquisitions, (viii) our ability to realize the expected benefits from and the success of our Foundry platform programs, (ix) our ability to successfully develop engineered cells, bioprocesses, data packages or other deliverables, and (x) the product development or commercialization success of our customers. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the "Risk Factors" section of Ginkgo's most recent quarterly report on Form 10-Q filed with the U.S. Securities and Exchange Commission (the "SEC"), and other documents filed by Ginkgo from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and Ginkgo assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. Ginkgo does not give any assurance that it will achieve its expectations.
Use of Non-GAAP Financial Measures
Certain of the financial measures included in this release, including Adjusted EBITDA, have not been prepared in accordance with generally accepted accounting principles ("GAAP"), and constitute "non-GAAP financial measures" as defined by the SEC.
Ginkgo has included these non-GAAP financial measures because it believes they provide an additional tool for investors to use in evaluating Ginkgo's financial performance and prospects. Due to the nature and/or size of the items being excluded, such items do not reflect future gains, losses, expenses or benefits and are not indicative of our future operating performance. These non-GAAP financial measures are supplemental to, should not be considered in isolation from, or as an alternative to, financial measures determined in accordance with GAAP. In addition, these non-GAAP financial measures may differ from non-GAAP financial measures with comparable names used by other companies. See the reconciliation below for additional information regarding certain of the non-GAAP financial measures included in this release, including a description of these non-GAAP financial measures and a reconciliation of the historic measures to Ginkgo's most comparable GAAP financial measures.
Ginkgo Bioworks Contacts:
INVESTOR CONTACT:
[email protected]
MEDIA CONTACT:
[email protected]
| Ginkgo Bioworks Holdings, Inc. |
| Condensed Consolidated Statements of Cash Flows |
| (in thousands, unaudited) |
|
|
|
|
|
|
| Six Months Ended June 30, |
|
| 2023 |
| 2022 (as adjusted*) |
| Cash flows from operating activities: |
|
|
|
|
| Net loss |
| $
(378,284) |
| $
(1,263,163) |
| Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
| Depreciation and amortization |
| 36,610 |
| 17,968 |
| Stock-based compensation |
| 134,474 |
| 1,259,336 |
| Loss on equity method investments |
| 1,516 |
| 31,053 |
| Loss on investments |
| 8,491 |
| 38,223 |
| Change in fair value of warrant liabilities |
| 3,278 |
| (108,544) |
| Change in fair value of contingent consideration liability |
| 8,453 |
| 300 |
| Gain on deconsolidation of subsidiary |
| - |
| (15,900) |
| Impairment loss on assets held for sale |
| 9,001 |
| - |
| Non-cash customer consideration |
| (353) |
| (18,139) |
| Non-cash lease expense |
| 16,327 |
| 7,536 |
| Amortization of finance lease right-of-use assets |
| 569 |
| 1,004 |
| Non-cash in-process research and development |
| 3,981 |
| 1,162 |
| Other non-cash activity |
| 2,213 |
| 502 |
| Changes in operating assets and liabilities: |
|
|
|
|
| Accounts receivable |
| 15,397 |
| (38,598) |
| Prepaid expenses and other current assets |
| 9,538 |
| 4,373 |
| Inventory |
| 2,549 |
| (4,740) |
| Operating lease right-of-use assets |
| 4,096 |
| - |
| Other non-current assets |
| (2,426) |
| (419) |
| Accounts payable |
| 2,993 |
| 10,650 |
| Accrued expenses and other current liabilities |
| (6,997) |
| (12,881) |
| Deferred revenue, current and non-current |
| (21,372) |
| (19,708) |
| Operating lease liabilities, current and non-current |
| (13,250) |
| (5,332) |
| Other non-current liabilities |
| (922) |
| (3,989) |
| Net cash used in operating activities |
| (164,118) |
| (119,306) |
| Cash flows from investing activities: |
|
|
|
|
| Cash acquired in acquisition |
| - |
| 1,440 |
| Purchase of convertible note |
| - |
| (6,500) |
| Purchases of property and equipment |
| (32,974) |
| (13,153) |
| Proceeds from sale of equipment |
| 2,926 |
| 77 |
| Prepayment for marketable equity securities |
| - |
| (3,691) |
| Deconsolidation of subsidiaries - cash |
| - |
| (28,772) |
| Other |
| (590) |
| (49) |
| Net cash used in investing activities |
| (30,638) |
| (50,648) |
| Cash flows from financing activities: |
|
|
|
|
| Principal payments on finance leases |
| (648) |
| (609) |
| Contingent consideration payment |
| (1,042) |
| (521) |
| Other |
| (579) |
| (905) |
| Net cash provided by financing activities |
| (2,269) |
| (2,035) |
| Effect of foreign exchange rates on cash and cash equivalents |
| (495) |
| (104) |
| Net (decrease) increase in cash, cash equivalents and restricted cash |
| (197,520) |
| (172,093) |
|
|
|
|
|
| Cash and cash equivalents, beginning of period |
| 1,315,792 |
| 1,550,004 |
| Restricted cash, beginning of period |
| 53,789 |
| 42,924 |
| Cash, cash equivalents and restricted cash, beginning of period |
| 1,369,581 |
| 1,592,928 |
|
|
|
|
|
| Cash and cash equivalents, end of period |
| 1,105,787 |
| 1,377,152 |
| Restricted cash, end of period |
| 66,274 |
| 43,683 |
| Cash, cash equivalents and restricted cash, end of period |
| $
1,172,061 |
| $
1,420,835 |
|
|
|
|
|