Full Press Release Details
Biote Reports Second Quarter 2024 Financial Results
Procedure revenue growth accelerates sequentially
BioteRx roll-out on track with further expansion planned
Management reiterates 2024 financial guidance
IRVING, TX August 8, 2024 - Biote (NASDAQ: BTMD), a leading solutions provider in preventive health care through the delivery of
personalized hormone optimization and therapeutic wellness, today announced financial results for the second quarter ended June 30, 2024.
Second Quarter 2024 Financial Highlights
financial result comparisons made are against the prior-year period)
Biote s second quarter procedure revenue grew 7.8% from the prior-quarter period, increasing sequentially from the 6.6% rate
reported in the first quarter of 2024, said Terry Weber, Biote Chief Executive Officer. We continued to experience broad-based demand strength primarily from top-tier practitioners across our
network. Through the first half of the year, Biote has grown new clinics by approximately 30%, with an accelerated revenue ramp from clinics implementing our quick-start program that optimizes on-boarding
success for practitioners. During the second quarter, we increased our investments in sales and marketing to extend Biote s geographic presence, expanded our therapeutic wellness offerings and enhanced engagement with our top 500 practitioners
at our annual provider event.
Ms. Weber continued, We are pleased with the positive response from both patients and
practitioners to BioteRx, our recently launched suite of hormone and evidence-based wellness therapies. BioteRx builds upon our science-based approach, leveraging the latest technology and tools to enhance patient health outcomes while supporting
practitioners with unmatched education and training. Over the past several months, we have introduced BioteRx to approximately 600 clinics throughout our network, addressing essential healthcare needs in preventative wellness, sexual health and
weight loss. As we continue to roll out BioteRx over the remainder of this year and into 2025, we remain focused on delivering the next level of personalized medicine for our growing patient population.
2024 Second Quarter Financial Review
result comparisons made are against the prior-year period unless otherwise noted)
Revenue for the second quarter of 2024 was $49.2 million compared
to $49.3 million for the second quarter of 2023. Procedure revenue grew 7.8%, benefiting from growth at established clinics and the addition of new clinics. As expected, dietary supplement revenue decreased 32.2%, as we continued the transition
of our e-commerce business and lapped a significant seasonal promotion in last year s second quarter.
profit margin for the second quarter of 2024 was 68.9% compared to 67.9% for the second quarter of 2023. The increase in gross profit margin was primarily due to product mix and continued effective cost management. Gross profit margin in the second
quarter of 2024 included a $1.2 million step-up in inventory value from the acquisition of Asteria Health. Excluding this inventory revaluation, second quarter 2024 gross profit margin would have been
Operating income for the second quarter of 2024 was $6.2 million, compared to $7.7 million for the second quarter of 2023. Operating
income in the second quarter of 2024 decreased primarily due to increased investment in sales and marketing initiatives as well as higher legal expenses, partially offset by improved gross profit.
Net loss for the second quarter of 2024 was $(10.5) million, representing a net loss margin of (21.3)%, and diluted loss per share attributable to biote Corp.
stockholders of $(0.19), compared to net loss of $(13.1) million, representing a net loss margin of (26.6)%, and diluted loss per share attributable to biote Corp. stockholders of $(0.25), for the second quarter of 2023. Net loss for the second
quarter of 2024 and 2023 included a loss of $13.9 million and $6.4 million, respectively, due to a change in the fair value of earnout liabilities. Net loss for the second quarter of 2023 also included a loss of $11.8 million due to a
change in the fair value of the warrant liability. As of June 30, 2023, all of the outstanding warrants had been exchanged for Class A common stock.
Adjusted EBITDA for the second quarter of 2024 was $12.7 million, with an Adjusted EBITDA margin of 25.9%. In the second quarter of 2023, Adjusted EBITDA
was $14.5 million, with an Adjusted EBITDA margin of 29.5%. The decreases in Adjusted EBITDA and Adjusted EBITDA margin primarily reflected increased investments in sales and marketing initiatives as well as higher legal expenses, partially
offset by higher gross profit and gross profit margin.
Resolution of Legal Claims and Related Share Repurchases
As previously announced, on April 23, 2024, Biote reached a definitive settlement in the Company s
litigation with Dr. Gary S. Donovitz, Biote s founder, to resolve litigation. Under the terms of this settlement, Biote agreed to repurchase all the approximately 18.4 million shares beneficially owned by Dr. Donovitz at the
time of the settlement at an average price of $4.17 per share, with the first tranche of shares repurchased for $32.2 million on April 26, 2024. The remaining shares beneficially owned by Dr. Donovitz at the time of settlement will be
repurchased over the next three years. Also pursuant to the settlement, Biote cancelled all 3.9 million unvested earnout shares that were beneficially owned by Dr. Donovitz at the time of settlement.
Additionally, on June 28, 2024, Biote reached a definitive settlement with Marci M. Donovitz, stockholder of Biote, to resolve litigation. For
$60 million in the aggregate, Biote will repurchase all of the approximately 8.3 million shares beneficially owned by Ms. Donovitz at the time of the settlement at an average price of $7.23 per share, with the first tranche of shares
repurchased for $30.0 million on June 28, 2024. The remaining shares beneficially owned by Ms. Donovitz at the time of settlement will be repurchased over the next three years. Also pursuant to the settlement, Biote cancelled all of
the approximately 4.0 million unvested earnout shares that were beneficially owned by Ms. Donovitz at the time of settlement.
Ms. Weber concluded, Based on our solid first half performance and our expectation for accelerated growth in the second half of the
year, we reiterate our 2024 financial guidance for revenue and Adjusted EBITDA. While we will continue to make investments consistent with our growth strategy, we anticipate our overall operating expenses will moderate in the second half of 2024 as
compared to the first half of the year.
We continue to expect improved procedure revenue growth in the second half of 2024 relative to the first
half, driven by strengthened performance from our top-tier clinics, the continued expansion of our practitioner network and our quick-start program that accelerates the revenue ramp from new clinics.
| ($ in millions) | Previously Reported 2024 Guidance Ranges | |
| Revenue | $200-$204 | |
| Adjusted EBITDA 1 | $60-$63 |
management will host a conference call to review these results and provide a business update beginning at 5:00 p.m. ET on Thursday, August 8, 2024. To access the conference call by telephone, please dial (844)
481-2820 (U.S toll-free) or (412) 317-0679 (International). To access a live webcast of the call, interested parties may use the following link: biote Corp.
Second Quarter Earnings Call. A replay of the webcast will be available on the Events page of the Biote Investor Relations website, found here, shortly after the event concludes.
Discussion of Non-GAAP Financial Measures
To provide investors with additional information regarding our financial results, Biote has disclosed Adjusted EBITDA, a
non-GAAP financial measure that it calculates as net income before interest, taxes and depreciation and amortization, further adjusted to exclude stock-based compensation, litigation expenses, legal
settlements, transaction-related expenses, merger and acquisition expenses, fair value adjustments to certain equity instruments classified as liabilities and other expenses. Below we have provided a reconciliation of Adjusted EBITDA to net income,
the most directly comparable GAAP financial measure.
We present Adjusted EBITDA and Adjusted EBITDA margin because it is a key measure used by our
management to evaluate our operating performance, generate future operating plans and determine payments under compensation programs. Accordingly, we believe that Adjusted EBITDA and Adjusted EBITDA margin provide useful information to investors and
others in understanding and evaluating our operating results in the same manner as our management.
Adjusted EBITDA and Adjusted EBITDA margin have
limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are as follows:
In addition, Adjusted EBITDA and Adjusted EBITDA margin are subject to inherent limitations as it reflects the
exercise of judgment by Biote s management about which expenses are excluded or included. A reconciliation is provided in the financial statement tables included below in this press release for each
non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP. Because of these limitations, you should consider Adjusted EBITDA and Adjusted EBITDA margin
alongside other financial performance measures, including net income and our other GAAP results.
Non-GAAP Financial Measures
The Company does not provide a reconciliation of forward-looking non-GAAP financial measures to their comparable GAAP financial measures because it could not do so without unreasonable effort due to the unavailability of certain information needed to calculate reconciling items.
For example, the Company has not included a reconciliation of projected Adjusted EBITDA to GAAP net income (loss), which is the
most directly comparable GAAP measure, for the periods presented in reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation
S-K. The Company s projected Adjusted EBITDA excludes certain items that are inherently uncertain and difficult to predict including, but not limited to, share-based compensation expense, income taxes,
due diligence expenses and legal expenses. Due to the variability, complexity and limited visibility of the adjusting items that would be excluded from projected Adjusted EBITDA in future periods, management does not forecast them for internal use
and therefore cannot create a quantitative projected Adjusted EBITDA to GAAP net income (loss) reconciliation for the periods presented without unreasonable efforts. A quantitative reconciliation of projected Adjusted EBITDA to GAAP net income
(loss) for the periods presented would imply a degree of precision and certainty as to these future items that does not exist and could be confusing to investors. From a qualitative perspective, it is anticipated that the differences between
projected Adjusted EBITDA to GAAP net income (loss) for the periods presented will consist of items similar to those described in the financial tables later in this release, including, for example and without limitation, share-based compensation
expense, income taxes, due diligence expenses and legal expenses. The timing and amount of any of these excluded items could significantly impact the Company s GAAP net income (loss) for a particular period. When planning, forecasting and
analyzing future periods, the Company does so primarily on a non-GAAP basis without preparing a GAAP analysis.
Biote is transforming healthy aging through
innovative, personalized hormone optimization and therapeutic wellness solutions delivered by Biote-certified medical providers. Biote trains practitioners to identify and treat early indicators of aging conditions, an underserved global market,
providing affordable symptom relief for patients and driving clinic success for practitioners.
Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Some of the forward-looking statements can be identified by the use of forward-looking words. Statements that are not historical in nature, including the words may,
can, should, will, estimate, plan, project, forecast, intend, expect, hope, anticipate, believe,
seek, target, continue, could, might, ongoing, potential, predict, would and other similar expressions, are intended to identify
forward-looking statements. 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 results or developments to differ materially from those expressed or implied by such forward-looking statements, including but not limited to: the success of our dietary supplements to attain significant market acceptance
among clinics, practitioners and their patients; our customers reliance on certain third parties to support the manufacturing of bio-identical hormones for prescribers; our and our customers
sensitivity to regulatory, economic, environmental and competitive conditions in certain geographic regions; our ability to increase the use by practitioners and clinics of the Biote Method at the rate that we anticipate or at all; our ability to
grow our business; the significant competition we face in our industry; the impact of strategic acquisitions and the implementation of our growth strategies; our limited operating history; our ability to protect our intellectual property; the heavy
regulatory oversight in our industry; changes in applicable laws or regulations; the inability to
profitably expand in existing markets and into new markets; the possibility that we may be adversely impacted by other economic, business and/or competitive factors, including recent bank
failures; and future exchange and interest rates. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and other risks and uncertainties described in the Risk Factors section of
Biote s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2024, filed with the Securities and Exchange Commission on May 10, 2024, and other documents filed by Biote from time
to time with the Securities and Exchange Commission. 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 Biote 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. Biote does not give any assurance that it will achieve its expectations.
Consolidated Balance Sheets
| June 30, 2024 | December 31, 2023 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 26,419 | $ | 89,002 | ||||
| Accounts receivable, net | 7,700 | 6,809 | ||||||
| Inventory, net | 19,212 | 17,307 | ||||||
| Other current assets | 8,436 | 9,225 | ||||||
| Total current assets | 61,767 | 122,343 | ||||||
| Property and equipment, net | 4,523 | 1,218 | ||||||
| Capitalized software, net | 4,884 | 4,973 | ||||||
| Goodwill | 5,516 | |||||||
| Intangible assets, net | 5,967 | |||||||
| Operating lease right-of-use assets | 2,102 | 1,877 | ||||||
| Deferred tax asset | 8,141 | 24,884 | ||||||
| Total assets | $ | 92,900 | $ | 155,295 | ||||
| Liabilities and Stockholders Deficit | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 5,793 | $ | 4,155 | ||||
| Accrued expenses | 6,899 | 8,497 | ||||||
| Term loan, current | 6,250 | 6,250 | ||||||
| Deferred revenue, current | 3,159 | 3,002 | ||||||
| Earnout liabilities, current | 100 | |||||||
| Operating lease liabilities, current | 419 | 311 | ||||||
| Share repurchase liabilities, current | 23,646 | |||||||
| Total current liabilities | 46,266 | 22,215 | ||||||
| Term loan, net of current portion | 103,909 | 106,630 | ||||||
| Revolving loans | 10,000 | |||||||
| Deferred revenue, net of current portion | 1,544 | 1,322 | ||||||
| Operating lease liabilities, net of current portion | 1,807 | 1,680 | ||||||
| Share repurchase liabilities, net of current portion | 43,101 | |||||||
| TRA liability | 4,356 | 18,894 | ||||||
| Earnout liabilities, net of current portion | 23,568 | 41,100 | ||||||
| Total liabilities | 234,551 | 191,841 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders Deficit | ||||||||
| Preferred stock, $0.0001 par value, 10,000,000 shares authorized; no shares issued or outstanding as of June 30, 2024 and December 31, 2023 | ||||||||
| Class A common stock, $0.0001 par value, 600,000,000 shares authorized; 32,581,398, and 35,842,383, shares issued, 30,993,898 and 34,254,883 shares outstanding as of June 30, 2024 and December 31, 2023, respectively | 3 | 3 | ||||||
| Class V voting stock, $0.0001 par value, 100,000,000 shares authorized; 7,249,879 and 38,819,066 shares issued, 5,221,653 and 28,819,066 shares outstanding as of June 30, 2024 and December 31, 2023, respectively | 1 | 3 | ||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | (137,723 | ) | (29,391 | ) | ||||
| Accumulated other comprehensive loss | (22 | ) | (12 | ) | ||||
| Treasury stock, at cost | (5,600 | ) | ||||||
| biote Corp. s stockholders deficit | (143,341 | ) | (29,397 | ) | ||||
| Noncontrolling interest | 1,690 | (7,149 | ) | |||||
| Total stockholders deficit | (141,651 | ) | (36,546 | ) | ||||
| Total liabilities and stockholders deficit | $ | 92,900 | $ | 155,295 |
Consolidated Statements of Operations
(In Thousands, except per share values)