hboi20220930

hboi20220930_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549

FORM 10-Q

☒ 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 001-33957

HARVARD BIOSCIENCE, INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware	04-3306140
(State or other jurisdiction of Incorporation or organization)	(I.R.S. Employer Identification No.)

84 October Hill Road, Holliston, Massachusetts 01746

(Address of Principal Executive Offices, including zip code)

(508) 893-8999

(Registrant’s telephone number, including area code)

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, $0.01 par value	HBIO	The Nasdaq Global 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 31, 2022, there were 41,657,688 shares of the registrant’s common stock issued and outstanding.

Table of Contents

HARVARD BIOSCIENCE, INC.

FORM 10-Q

INDEX


	Page
PART I - FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements (unaudited)	3

Consolidated Balance Sheets	3

Consolidated Statements of Operations	4

Consolidated Statements of Comprehensive Loss	5

Consolidated Statements of Stockholders' Equity	6

Consolidated Statements of Cash Flows	7

Notes to Unaudited Consolidated Financial Statements	8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	19

Item 3. Quantitative and Qualitative Disclosures about Market Risk	25

Item 4. Controls and Procedures	25

PART II - OTHER INFORMATION

Item 1. Legal Proceedings	26

Item1A. Risk Factors	26

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.	27

Item 3. Defaults Upon Senior Securities	27

Item 4. Mine Safety Disclosures	27

Item 5. Other Information	27

Item 6. Exhibits	27

SIGNATURES	28

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

HARVARD BIOSCIENCE, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited, in thousands, except share and per share data)

	September 30,			December 31,
	2022			2021
Assets
Current assets:
Cash and cash equivalents	$	5,144		$	7,821
Accounts receivable, net		15,023			21,834
Inventories		26,116			27,587
Other current assets		5,535			4,341
Total current assets		51,818			61,583
Property, plant and equipment, net		3,555			3,415
Operating lease right-of-use assets		6,019			6,897
Goodwill		54,851			57,689
Intangible assets, net		22,464			27,385
Other long-term assets		8,306			5,375
Total assets	$	147,013		$	162,344
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt	$	2,720		$	3,235
Current portion of operating lease liabilities		2,121			2,142
Accounts payable		5,877			4,911
Deferred revenue		3,642			4,266
Other current liabilities		7,000			10,762
Total current liabilities		21,360			25,316
Long-term debt, net		46,534			45,095
Deferred tax liability		1,181			1,558
Operating lease liabilities		5,539			6,488
Other long-term liabilities		420			486
Total liabilities		75,034			78,943
Commitments and contingencies - Note 12
Stockholders' equity:
Preferred stock, par value $0.01 per share, 5,000,000 shares authorized		-			-
Common stock, par value $0.01 per share, 80,000,000 shares authorized: 41,657,688 shares issued and outstanding at September 30, 2022; 41,142,876 shares issued and outstanding at December 31, 2021		453			452
Additional paid-in-capital		228,229			225,650
Accumulated deficit		(140,524	)		(132,674	)
Accumulated other comprehensive loss		(16,179	)		(10,027	)
Total stockholders' equity		71,979			83,401
Total liabilities and stockholders' equity	$	147,013		$	162,344

See accompanying notes to condensed consolidated financial statements.

Table of Contents

HARVARD BIOSCIENCE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited, in thousands, except per share data)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021

Revenues	$	26,922		$	29,663		$	84,908		$	85,849
Cost of revenues		14,750			13,355			39,922			37,757
Gross profit		12,172			16,308			44,986			48,092

Sales and marketing expenses		5,819			6,183			19,093			17,299
General and administrative expenses		6,324			5,458			18,630			18,190
Research and development expenses		2,763			2,660			9,480			7,848
Amortization of intangible assets		1,572			1,459			4,492			4,388
Settlement of litigation, net - Note 13		(544	)		-			(233	)		-
Total operating expenses		15,934			15,760			51,462			47,725

Operating (loss) income		(3,762	)		548			(6,476	)		367

Other expense:
Interest expense		(749	)		(373	)		(1,648	)		(1,161	)
Other expense, net		(179	)		(130	)		(163	)		(477	)
Total other expense		(928	)		(503	)		(1,811	)		(1,638	)

(Loss) income before income taxes		(4,690	)		45			(8,287	)		(1,271	)
Income tax (benefit) expense		(1,285	)		215			(437	)		(22	)
Net loss	$	(3,405	)		(170	)	$	(7,850	)	$	(1,249	)

Loss per share:
Basic and diluted loss per common share	$	(0.08	)	$	(0.00	)	$	(0.19	)	$	(0.03	)

Weighted-average common shares:
Basic and diluted		41,637			40,754			41,353			40,202

See accompanying notes to condensed consolidated financial statements.

Table of Contents

HARVARD BIOSCIENCE, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Unaudited, in thousands)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2022			2021			2022			2021

Net loss	$	(3,405	)	$	(170	)	$	(7,850	)	$	(1,249	)
Other comprehensive loss:
Foreign currency translation adjustments		(2,936	)		(1,135	)		(6,152	)		(1,937	)
Comprehensive loss	$	(6,341	)	$	(1,305	)	$	(14,002	)	$	(3,186	)

See accompanying notes to condensed consolidated financial statements.

Table of Contents

HARVARD BIOSCIENCE, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited, in thousands)

												Accumulated
Three Months Ended	*Number*					*Additional*						*Other*					*Total*
September 30, 2022	*of Shares*			*Common*		*Paid-in*			*Accumulated*			*Comprehensive*			*Treasury*		*Stockholders*’
	*Issued*			*Stock*		*Capital*			*Deficit*			*Loss*			*Stock*		*Equity*
Balance at June 30, 2022		41,500		$	453	$	227,413		$	(137,119	)	$	(13,243	)	$	-	$	77,504
Stock option exercises		24			-		64			-			-			-		64
Vesting of restricted stock units		233			-		-			-			-			-		-
Shares withheld for taxes		(100	)		-		(387	)		-			-			-		(387	)
Stock-based compensation expense		-			-		1,139			-			-			-		1,139
Net income		-			-		-			(3,405	)		-			-		(3,405	)
Other comprehensive loss		-			-		-			-			(2,936	)		-		(2,936	)
Balance at September 30, 2022		41,657		$	453	$	228,229		$	(140,524	)	$	(16,179	)	$	-	$	71,979

												Accumulated
Three Months Ended	*Number*					*Additional*						*Other*					*Total*
September 30, 2021	*of Shares*			*Common*		*Paid-in*			*Accumulated*			*Comprehensive*			*Treasury*		*Stockholders*’
	*Issued*			*Stock*		*Capital*			*Deficit*			*Loss*			*Stock*		*Equity*
Balance at June 30, 2021		40,486		$	451	$	225,583		$	(133,465	)	$	(13,868	)	$	-	$	78,701
Stock option exercises		38			-		150			-			-			-		150
Vesting of restricted stock units		493			-		-			-			-			-		-
Shares withheld for taxes		(208	)		-		(1,663	)		-			-			-		(1,663	)
Stock-based compensation expense		-			-		1,004			-			-			-		1,004
Net loss		-			-		-			(170	)		-			-		(170	)
Other comprehensive loss		-			-		-			-			(1,135	)		-		(1,135	)
Balance at September 30, 2021		40,809		$	451	$	225,074		$	(133,635	)	$	(15,003	)	$	-	$	76,887

										Accumulated
Nine Months Ended	*Number*				*Additional*					*Other*					*Total*
September 30, 2022	*of Shares*		*Common*		*Paid-in*		*Accumulated*			*Comprehensive*			*Treasury*		*Stockholders*’
	*Issued*		*Stock*		*Capital*		*Deficit*			*Loss*			*Stock*		*Equity*
Balance at December 31, 2021		41,143	$	452	$	225,650	$	(132,674	)	$	(10,027	)	$	-	$	83,401
Stock option exercises		40		1		106		-

SEC Form 10-Q filed by Harvard Bioscience Inc.