0000720154FALSE00007201542025-02-052025-02-05

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 5, 2025
INOTIV, INC.
(Exact name of registrant as specified in its charter)
Indiana 0-23357 35-1345024
(State or other jurisdiction of
 incorporation)		 (Commission File Number) (IRS Employer Identification No.)
2701 KENT AVENUE
WEST LAFAYETTE,INDIANA
 
47906-1382
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (765) 463-4527
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange
 on which registered
Common SharesNOTVThe Nasdaq Stock Market LLC
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
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. o


The information provided in Item 2.02 and Item 9.01, including Exhibit 99.1, of this Form 8-K is being furnished and shall not be deemed "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, except as shall be expressly set forth by specific reference in such a filing.
Item 2.02.    Results of Operations and Financial Condition.
On February 5, 2025, Inotiv, Inc. issued a press release announcing financial results for the three months ended December 31, 2024. The full text of the press release is furnished as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference.
Item 9.01.    Financial Statements and Exhibits.
(d)Exhibits
Exhibit
No.		Description
99.1
104Cover Page Interactive Data File (embedded within the Inline XBRL document).


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
INOTIV, INC.
Date:February 5, 2025By:/s/ Beth A. Taylor
Chief Financial Officer,
Senior Vice President—Finance


Exhibit 99.1

Inotiv Reports First Quarter Financial Results for Fiscal 2025 and Provides Business Update

–Enhanced liquidity by $27.5 million through the issuance of 6.9 million common shares
–First quarter fiscal 2025 revenue declined 11.5% to $119.9 million
–Conference call scheduled for today at 4:30 pm ET

WEST LAFAYETTE, IN, February 5, 2025 – Inotiv, Inc. (Nasdaq: NOTV) (the “Company”), a leading contract research organization specializing in nonclinical and analytical drug discovery and development services and research models and related products and services, today announced financial results for the three months (“Q1 FY 2025”) ended December 31, 2024.

Revenue by Segment (in millions of USD)
Three Months Ended December 31,%
change
20242023
(unaudited)(unaudited)
DSA (Discovery & Safety Assessment)$42.8$44.7(4.2)%
RMS (Research Models & Services)$77.1$90.8(15.1)%
Total$119.9$135.5(11.5)%

Management Commentary

Robert Leasure Jr., President and Chief Executive Officer, commented, “We are dedicated to building a stronger, more consistent company that delivers value to our clients, employees, and shareholders. In the first quarter of fiscal 2025, we continued to make progress in our top priorities, such as unifying our operations under one brand and as one company, strengthening our financial stability, and enhancing the client experience. Our recent equity offering generated $27.5 million in net proceeds, which allows us to continue to make thoughtful, strategic decisions, and to drive sustainable growth creating shareholder value.

"To reduce revenue volatility, we have expanded our NHP client base and secured pre-sales for calendar year 2025. Additionally, we expect our colony management services to experience steady growth and increased revenue, building on the momentum from 2024. We are continuing to advance the optimization of our North American transportation and distribution systems for a smoother, more reliable experience for our clients while improving overall efficiency. Finally, once we complete the next phase of our North American RMS site optimization plan, we anticipate annual cost savings of approximately $4.0 to $5.0 million. These efficiencies are expected to help us maintain high-quality service, reduce production costs, and continue being a trusted partner in delivering consistent, reliable service for our clients."

Highlights

Q1 FY 2025 Highlights

•Revenue was $119.9 million in Q1 FY 2025, a decrease of $15.6 million or 11.5%, compared to $135.5 million during the three months ended December 31, 2023 (“Q1 FY 2024”), primarily driven by a decrease of $13.7 million, or 15.1%, in Research Models and Services (“RMS”) revenue and a $1.9 million, or 4.2%, decrease in Discovery and Safety Assessment ("DSA") revenue.
•Consolidated net loss for Q1 FY 2025 was $27.6 million, or 23.0% of total revenue, compared to consolidated net loss of $15.8 million, or 11.7% of total revenue, in Q1 FY 2024.
•Adjusted EBITDA1 in Q1 FY 2025 was $2.6 million, or 2.2% of total revenue, compared to $9.6 million, or 7.1% of total revenue, in Q1 FY 2024.
•Book-to-bill ratio for Q1 FY 2025 was 1.01x for the DSA services business.
•DSA backlog was $130.4 million at December 31, 2024 compared to $129.9 million at September 30, 2024 and $152.3 million at December 31, 2023.



1 This is a non-GAAP financial measure. Refer to “Note on Non-GAAP Financial Measures” in this release for further information.

Operational and Capital Resources Highlights

•On October 24, 2024, the Company and Orient BioResource Center entered into a Third Amendment to extend the maturity date of the Seller Payable to January 27, 2026.
•In closings on December 19, 2024 and December 30, 2024, the Company raised approximately $27.5 million in net proceeds from its underwritten public offering of a total of 6.9 million common shares at a price to the public of $4.25 per share.

First Quarter Fiscal 2025 Financial Results (Three Months Ended December 31, 2024)

Revenue decreased 11.5% to $119.9 million in Q1 FY 2025 as compared to $135.5 million in Q1 FY 2024. The lower total revenue in the first quarter was driven by a $13.7 million decrease in RMS revenue and a $1.9 million decrease in DSA revenue. The decrease in RMS revenue was due to lower non-human primate ("NHP") related product and service revenue of $13.5 million mainly as a result of lower pricing for NHPs. DSA revenues decreased primarily due to a decrease in discovery service revenue.

Operating loss was $15.5 million in Q1 FY 2025 as compared to an operating loss of $9.4 million in Q1 FY 2024. The increase in operating loss was primarily driven by a decrease in RMS operating income of $6.3 million, or 123.3%. The decrease in RMS operating income was driven by the decrease in revenue discussed above, partially offset by a $6.4 million decrease in cost of revenue. The decrease in RMS cost of revenue was primarily driven by decreases in costs associated with NHP-related product and service revenue of $3.9 million, as well as decreases in restructuring costs, transportation costs and costs related to sites closed in connection with our optimization plan.

Cash and cash equivalents of $38.0 million at December 31, 2024, compares to $21.4 million at September 30, 2024. Cash used in operating activities was $4.5 million for Q1 FY 2025 compared to $6.5 million for Q1 FY 2024. For Q1 FY 2025, capital expenditures totaled $4.5 million compared to $5.6 million for Q1 FY 2024. Total debt, net of debt issuance costs, as of December 31, 2024, was $396.0 million. As of December 31, 2024, there were no borrowings on the Company’s $15.0 million revolving credit facility.

Webcast and Conference Call
Management will host a conference call on Wednesday, February 5, 2025, at 4:30 pm ET to discuss first quarter fiscal 2025 results.
Interested parties may participate in the call by dialing:
•(800) 579-2543 (Domestic)
•(785) 424-1789 (International)
•"Inotiv" (Conference ID)

The live conference call webcast will be accessible in the Investors section of the Company’s web site and directly via the following link:

https://viavid.webcasts.com/starthere.jsp?ei=1703666&tp_key=aaee0f56f1

For those who cannot listen to the live broadcast, an online replay will be available in the Investors section of Inotiv’s web site at: https://ir.inotiv.com/events-and-presentations/default.aspx.

Note on Non-GAAP Financial Measures

This press release contains financial measures that are not calculated in accordance with generally accepted accounting principles in the United States (GAAP), including Adjusted EBITDA and Adjusted EBITDA as a percentage of total revenue for the three months ended December 31, 2024 and 2023 and selected business segment information for those periods. Adjusted EBITDA as reported herein refers to a financial measure that excludes from consolidated net loss, statements of operations line items interest expense and income tax benefit/provision, as well as non-cash charges for depreciation and amortization, stock compensation expense, acquisition and integration costs, startup costs, restructuring costs, unrealized foreign exchange (gain) loss, amortization of inventory step up, (gain) loss on disposition of assets and other unusual, third party costs. The adjusted business segment information excludes from operating loss and unallocated


corporate operating expenses for these same expenses. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in this press release.

The Company believes that these non-GAAP measures provide useful information to investors. Among other things, they may help investors evaluate the Company’s ongoing operations. They can assist in making meaningful period-over-period comparisons and in identifying operating trends that would otherwise be masked or distorted by the items subject to the adjustments. Management uses these non-GAAP measures internally to evaluate the performance of the business, including to allocate resources. Investors should consider these non-GAAP measures as supplemental and in addition to, not as a substitute for or superior to, measures of financial performance prepared in accordance with GAAP.

Management has chosen to provide this supplemental information to investors, analysts, and other interested parties to enable them to perform additional analyses of our results and to illustrate our results giving effect to the non-GAAP adjustments. Management strongly encourages investors to review the Company's condensed consolidated financial statements and publicly filed reports in their entirety and cautions investors that the non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures.

About the Company

Inotiv, Inc. is a leading contract research organization dedicated to providing nonclinical and analytical drug discovery and development services and research models and related products and services. The Company’s products and services focus on bringing new drugs and medical devices through the discovery and preclinical phases of development, all while increasing efficiency, improving data, and reducing the cost of taking new drugs and medical devices to market. Inotiv is committed to supporting discovery and development objectives as well as helping researchers realize the full potential of their critical research and development projects, all while working together to build a healthier and safer world. Further information about Inotiv can be found here: https://www.inotiv.com/.

This release contains forward-looking statements that are subject to risks and uncertainties including, but not limited to, statements regarding our intent, belief or current expectations with respect to (i) our strategic plans; (ii) trends in the demand for our services and products; (iii) trends in the industries that consume our services and products; (iv) market and company-specific impacts of NHP supply and demand matters; (v) compliance with the Resolution Agreement and Plea Agreement and the expected impacts on the Company related to the compliance plan and compliance monitor, and the expected amounts, timing and expense treatment of cash payments and other investments thereunder; (vi) our ability to service our outstanding indebtedness and to comply or regain compliance with financial covenants, including those established by the Seventh Amendment to our Credit Agreement; (vii) our current and forecasted cash position; (viii) our ability to make capital expenditures, fund our operations and satisfy our obligations; (ix) our ability to manage recurring and unusual costs; (x) our ability to execute on and realize the expected benefits related to our restructuring and site optimization plans; (xi) our expectations regarding the volume of new bookings, pre-sales, pricing, cost savings initiatives, expansion of services, operating income or losses and liquidity; (xii) our ability to effectively fill the recent expanded capacity or any future expansion or acquisition initiatives undertaken by us; (xiii) our ability to develop and build infrastructure and teams to manage growth and projects; (xiv) our ability to continue to retain and hire key talent; (xv) our ability to market our services and products under our corporate name and relevant brand names; (xvi) our ability to develop new services and products; (xvii) our ability to negotiate amendments to the Credit Agreement or obtain waivers related to the financial covenants defined within the Credit Agreement, including those detailed in the Company's filings with the U.S. Securities and Exchange Commission. Further discussion of these risks, uncertainties, and other matters can be found in the Risk Factors detailed in our Annual Report on Form 10-K as filed on December 4, 2024, as well as other filings we make with the Securities and Exchange Commission.

Company ContactInvestor Relations
Inotiv, Inc. LifeSci Advisors
Beth A. Taylor, Chief Financial OfficerSteve Halper
(765) 497-8381(646) 876-6455
beth.taylor@inotiv.comshalper@lifesciadvisors.com


INOTIV, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three Months Ended
December 31,
20242023
Service revenue$53,557 $53,863 
Product revenue66,319 81,638 
Total revenue$119,876 $135,501 
Costs and expenses:
Cost of services provided (excluding depreciation and amortization of intangible assets)39,244 39,077 
Cost of products sold (excluding depreciation and amortization of intangible assets)55,594 62,951 
Selling5,137 5,348 
General and administrative19,152 19,927 
Depreciation and amortization of intangible assets14,179 14,250 
Other operating expense2,077 3,319 
Operating loss$(15,507)$(9,371)
Other (expense) income:
Interest expense(13,838)(11,364)
Other (expense) income(463)1,413 
Loss before income taxes$(29,808)$(19,322)
Income tax benefit2,178 3,494 
Consolidated net loss$(27,630)$(15,828)
Less: Net loss attributable to noncontrolling interests— (440)
Net loss attributable to common shareholders$(27,630)$(15,388)
Loss per common share
Net loss attributable to common shareholders:
Basic$(1.02)$(0.60)
Diluted$(1.02)$(0.60)
Weighted-average number of common shares outstanding:
Basic27,16025,764
Diluted27,16025,764


INOTIV, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
December 31,September 30,
20242024
(Unaudited)
Assets
Current assets:
Cash and cash equivalents$38,043 $21,432 
Trade receivables and contract assets, net of allowances for credit losses of $6,421 and $6,931, respectively70,140 73,560 
Inventories, net31,557 18,173 
Prepaid expenses and other current assets29,661 50,248 
Assets held for sale2,016 — 
Total current assets171,417 163,413 
Property and equipment, net182,279 188,328 
Operating lease right-of-use assets, net48,827 49,165 
Goodwill94,286 94,286 
Other intangible assets, net264,767 274,396 
Other assets11,331 11,773 
Total assets$772,907 $781,361 
Liabilities and shareholders' equity
Current liabilities:
Accounts payable$24,954 $33,526 
Accrued expenses and other current liabilities25,500 28,218 
Fees invoiced in advance46,129 41,986 
Current portion of long-term operating lease9,505 11,774 
Current portion of long-term debt 3,037 3,538 
Total current liabilities109,125 119,042 
Long-term operating leases, net 41,588 40,010 
Long-term debt, less current portion, net of debt issuance costs392,978 389,801 
Other long-term liabilities35,360 34,963 
Deferred tax liabilities, net24,024 27,041 
Total liabilities603,075 610,857 
Shareholders’ equity:
Common shares, no par value:
Authorized 74,000,000 shares at December 31, 2024 and at September 30, 2024; 33,717,662 issued and outstanding at December 31, 2024 and 26,015,129 at September 30, 20248,391 6,466 
Additional paid-in capital752,136 724,789 
Accumulated deficit(589,794)(562,163)
Accumulated other comprehensive (loss) income(901)1,412 
Total equity169,832 170,504 
Total liabilities and shareholders’ equity$772,907 $781,361 


INOTIV, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Three Months Ended
December 31,
20242023
Operating activities:
Consolidated net loss$(27,630)$(15,828)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization14,179 14,250 
Employee stock compensation expense1,770 1,897 
Changes in deferred taxes(2,802)(5,318)
Provision for expected credit losses(453)(438)
Amortization of debt issuance costs and original issue discount1,288 846 
Non-cash interest and accretion expense3,076 1,688 
Other non-cash operating activities643 (1,147)
Changes in operating assets and liabilities:
Trade receivables and contract assets3,391 (1,497)
Inventories(13,632)6,058 
Prepaid expenses and other current assets19,606 7,096 
Operating lease right-of-use assets and liabilities, net(353)138 
Accounts payable(7,240)(2,845)
Accrued expenses and other current liabilities(2,343)(2,497)
Fees invoiced in advance5,071 (20,012)
Other asset and liabilities, net932 11,064 
Net cash used in operating activities(4,497)(6,545)
Investing activities:
Capital expenditures(4,459)(5,572)
Proceeds from sale of property and equipment— 1,529 
Net cash used in investing activities(4,459)(4,043)
Financing activities:
Payments on revolving credit facility(20,000)— 
Payments on senior term notes and delayed draw term loans(691)(691)
Borrowings on revolving credit facility20,000 — 
Issuance of common shares27,524 — 
Other financing activities, net(708)(2,230)
Net cash provided by (used in) financing activities26,125 (2,921)
Effect of exchange rate changes on cash and cash equivalents(558)18 
Net increase (decrease) in cash and cash equivalents16,611 (13,491)
Cash and cash equivalents at beginning of period21,432 35,492 
Cash and cash equivalents at end of period$38,043 $22,001 
Supplemental disclosure of cash flow information:
Cash paid for interest$10,888 $11,068 
Income taxes paid, net$271 $298 


INOTIV, INC.
RECONCILIATION OF GAAP TO NON-GAAP
SELECT BUSINESS SEGMENT INFORMATION
(In thousands)
(Unaudited)
 Three Months Ended
December 31,
 20242023
DSA
Revenue42,822 44,698 
Operating income
1,946 1,593 
Operating income as a % of total revenue1.6 %1.2 %
Add back:
Depreciation and amortization4,583 4,409 
Restructuring costs (1)— 113 
Startup costs (2)559 830 
Total non-GAAP adjustments to operating income5,142 5,352 
Non-GAAP operating income7,088 6,945 
Non-GAAP operating income as a % of DSA revenue16.6 %15.5 %
Non-GAAP operating income as a % of total revenue5.9 %5.1 %
 
RMS
Revenue77,054 90,803 
Operating (loss) income (1,185)5,078 
Operating (loss) income as a % of total revenue(1.0 %)3.7 %
Add back:  
Depreciation and amortization9,438 9,737 
Restructuring costs (1)224 921 
Amortization of inventory step up— 102 
 Other unusual, third party costs (3)961 1,086 
Total non-GAAP adjustments to operating (loss) income
10,623 11,846 
Non-GAAP operating income9,438 16,924 
Non-GAAP operating income as a % of RMS revenue12.2 %18.6 %
Non-GAAP operating income as a % of total revenue7.9 %12.5 %


 Three Months Ended
December 31,
 20242023
Unallocated Corporate Operating Loss(16,268)(16,042)
Unallocated corporate operating loss as a % of total revenue(13.6)%(11.8)%
Add back:
Depreciation and amortization158 104 
Stock compensation expense1,770 1,897 
Acquisition and integration costs— 70 
Total non-GAAP adjustments to operating loss1,928 2,071 
Non-GAAP operating loss(14,340)(13,971)
Non-GAAP operating loss as a % of total revenue(12.0)%(10.3)%
Total
Revenue119,876 135,501 
Operating loss(15,507)(9,371)
Operating loss as a % of total revenue(12.9)%(6.9 %)
Add back:
Depreciation and amortization14,179 14,250 
Stock compensation expense1,770 1,897 
Restructuring costs (1)224 1,034 
Acquisition and integration costs— 70 
Amortization of inventory step up— 102 
Startup costs (2)559 830 
Other unusual, third party costs (3)961 1,086 
Total non-GAAP adjustments to operating loss17,693 19,269 
Non-GAAP operating income2,186 9,898 
Non-GAAP operating income as a % of total revenue1.8 %7.3 %
(a)Adjustments to certain GAAP reported measures for the three months ended December 31, 2024 and 2023 include, but are not limited to, the following:
(1)For the three months ended December 31, 2024 and 2023, primarily represents costs incurred in connection with the exit of multiple sites and the enablement of the in-house integration of Inotiv’s North American transportation operations as previously disclosed.
(2)For the three months ended December 31, 2024 and 2023, primarily represents costs related to the development and initiation of new service offerings that are not yet revenue generating for the respective periods.
(3)For the three months ended December 31, 2024, primarily represents third party legal costs incurred in connection with the Department of Justice and certain other legal matters. For the three months ended December 31, 2023, primarily represents third party legal costs incurred in connection with the Department of Justice and certain remediation costs.


INOTIV, INC.
RECONCILIATION OF GAAP NET LOSS TO NON-GAAP ADJUSTED EBITDA
(In thousands)
(Unaudited)
 Three Months Ended
December 31,
 20242023
GAAP Consolidated Net Loss$(27,630)$(15,828)
Adjustments (a)
Interest expense13,83811,364
Income tax benefit(2,178)(3,494)
Depreciation and amortization14,17914,250
Stock compensation expense1,7701,897
Acquisition and integration costs—70
Startup costs (1)
559830
Restructuring costs (2)
2241,034
Unrealized foreign exchange (gain) loss825(1,029)
Amortization of inventory step up—102
(Gain) loss on disposition of assets62(666)
Other unusual, third party costs (3)
9611,086
Adjusted EBITDA
$2,610$9,616
GAAP consolidated net loss as a percent of total revenue(23.0)%(11.7)%
Adjustments as a percent of total revenue25.2 %18.8 %
Adjusted EBITDA as a percent of total revenue2.2 %7.1 %
(a)Adjustments to certain GAAP reported measures for the three months ended December 31, 2024 and 2023 include, but are not limited to, the following:
(1)For the three months ended December 31, 2024 and 2023, primarily represents costs related to the development and initiation of new service offerings that are not yet revenue generating for the respective periods.
(2)For the three months ended December 31, 2024 and 2023, primarily represents costs incurred in connection with the exit of multiple sites and the enablement of the in-house integration of Inotiv’s North American transportation operations as previously disclosed.
(3)For the three months ended December 31, 2024, primarily represents third party legal costs incurred in connection with the Department of Justice and certain other legal matters. For the three months ended December 31, 2023, primarily represents third party legal costs incurred in connection with the Department of Justice and certain remediation costs.

v3.25.0.1
Cover
Feb. 05, 2025
Cover [Abstract]  
Document Type 8-K
Document Period End Date Feb. 05, 2025
Entity Registrant Name INOTIV, INC.
Entity Incorporation, State or Country Code IN
Entity File Number 0-23357
Entity Tax Identification Number 35-1345024
Entity Address, Address Line One 2701 KENT AVENUE
Entity Address, City or Town WEST LAFAYETTE
Entity Address, State or Province IN
Entity Address, Postal Zip Code 47906
City Area Code 765
Local Phone Number 463-4527
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Shares
Trading Symbol NOTV
Security Exchange Name NASDAQ
Entity Emerging Growth Company false
Entity Central Index Key 0000720154
Amendment Flag false
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