Q1 2025 Neogen Corp Earnings Call Transcript
Key Points
- Neogen Corp (NEOG) has solidified its position as the largest player in the food safety market following the 3M food safety transaction, enhancing its product portfolio and geographic reach.
- The company is benefiting from secular tailwinds in the food safety market, including increasing regulatory requirements and consumer expectations for food transparency.
- Neogen Corp (NEOG) is seeing growth in its large animal genomics business, particularly in the beef and dairy segments.
- The company has resolved ERP-related challenges in its primary distribution center, improving operational efficiency.
- Neogen Corp (NEOG) is making progress in regaining market share, with encouraging responses from initial efforts to win back previously impacted customers.
- Neogen Corp (NEOG) experienced a 1% decline in core revenue for the first quarter, with foreign currency posing a 390 basis point headwind.
- The Animal Safety segment is facing challenges due to cyclical lows in end market conditions, particularly in the United States.
- The company saw a decline in its genomics business on a year-over-year basis, with weakness in the companion animal segment.
- Gross margin decreased by 260 basis points year-over-year, driven by lower volume and higher distribution costs.
- Neogen Corp (NEOG) is facing challenges in customer recovery, particularly in the US, due to previous shipping delays and needs to demonstrate consistent supply to win back trust.
Good morning, ladies and gentlemen, and welcome to the Neogen Corporation first quarter 2025 earnings call. (Operator Instructions) This call is being recorded on Tuesday, October 10, 2024.
I would now like to turn the conference over to Bill Waelke, VP, Investor Relations and Treasury. Please go ahead.
Thank you for joining us this morning for the discussion of the first quarter of our 2025 fiscal year. I'll briefly cover the non-GAAP and forward-looking language before passing the call over to our CEO, John Adent, who will be followed by our CFO, Dave Naemura.
Before the market opened today, we published our first quarter results as well as the presentation with both documents available in the Investor Relations section of our website.
On our call this morning, we will refer to certain non-GAAP financial measures that we believe are useful in evaluating our performance. Reconciliations of historical non-GAAP financial measures are included in our earnings
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