Champions Oncology (CSBR) Stock Delivers Strong Quarterly Improvement

Champions Oncology (CSBR) is continuing on its growth initiative, delivering another set of strong quarterly results, driving both revenue and client bookings higher, with increases of 40% and 30%, respectively. Our partners at Trade Ideas provided the first alert.

The CSBR Numbers

During the Third Quarter, CSBR revenue increased to $3.6 million dollars, a 40% increase on a YOY basis. Commenting on the growth, Ronnie Morris, CEO of Champions Oncology, said, “This was a solid quarter of execution for Champions, with our strongest-ever quarterly bookings reinforcing management’s long-term confidence in the business. Year-over-year revenue growth continued at a 40% pace, even while timing-related issues tied to individual customers impacted our top line. The acceleration of our bookings, combined with our ongoing efforts to reduce expenses, reinforces our expectations for near-term profitability. In a few quarters, we believe we will reach sustainable profitability, even as we experience normal revenue volatility, while continuing our level of investment in research and development.”

He added,”Our strong growth to date has been driven by our core business,” continued Morris. “We continue to invest in building new models that reflect the evolving standard of care to provide robust model cohorts for pre-clinical research and clinical trial simulation. We have expanded our relevant TumorBank with more than 160 new and unique models in the past six months. We are planning to expand our solution offerings with the expansion of immune-oncology (‘IO’) clinical simulation and data analytics solutions that we believe will accelerate our long term growth.”

Breaking it down, for the third quarter of fiscal 2017, CSBR revenue was $3.6 million, as compared to $2.6 million for the third quarter 2016, an increase of 39.7%. Total operating expenses for the third quarter fiscal 2017 and 2016 was $5 million and $4.9 million, respectively, an increase of $100,000 or 0.8%. Revenue was $11.7 million and $8.3 million for the nine months ended January 31, 2017 and 2016, respectively, an increase of $3.4 million or 40.1%.

Champions Going Forward

CSBR is clearly gaining momentum on several fronts, and with the company announcing plans to have a new facility in place during the middle of 2018, confidence must be high that the trend will continue. Following the GAAP methods required for accounting, revenue recognition is a tricky metric for investors to follow. Because of the unique nature of its business, CSBR is only entitled to record revenue once a project is completed. Therefore, revenue is sometimes understated and sometimes overstated, depending on the end time of each client contract. With that said, investors should take caution into taking only a short term look at the filings, and understand that what is reported is not necessarily reflective of longer term (6-9 months) financial results. Importantly, CSBR management has cash on hand of $3.5 million dollars and has stated that they have no intention of utilizing the capital markets in the foreseeable future to raise additional capital.

Champions Oncology, Inc. is engaged in the development of advanced technology solutions and services to personalize the development and use of oncology drugs.  The Company’s TumorGraft technology platform is a novel approach to personalizing cancer care based upon the implantation of primary human tumors in immune deficient mice followed by propagation of the resulting engraftments, or TumorGrafts, in a manner that preserves the biological characteristics of the original human tumor in order to determine the efficacy of a treatment regimen.

As always, stay close to CNA Finance for all breaking and real time news for CSBR.

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