Hamilton Thorne Ltd. (OTCPK:HTLZF) Q4 2023 Earnings Conference Call March 27, 2024 9:00 AM ET
Company Participants
David Wolf – Executive Chairman
Kate Torchilin – Chief Executive Officer, President and Director
Francesco Fragasso – Chief Financial Officer
Conference Call Participants
Kyle McPhee – Cormark Securities
David Martin – Bloom Burton
Justin Keywood – Stifel
Stefan Quenneville – Echelon Capital Management
Operator
Welcome to the Hamilton Thorne Limited Fourth Quarter and Full-Year 2023 Earnings Conference Call. Before turning the call over to your host today, please be reminded of our standard public company policy on forward-looking information and use of non-IFRS measures. Certain information presented or otherwise discussed on this call may contain forward-looking statements. These statements may involve, but are not limited to comments relating to strategies, expectations, planned operations, product announcements, scientific advances or future actions.
The information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Should one or more risks or uncertainties materialize or should assumptions underlying the forward-looking statements prove incorrect, actual results, performance or achievements could vary materially from those expressed or implied by these forward-looking statements. These factors should be considered carefully and prospective investors and other parties should not place undue reliance on these forward-looking statements.
The company assumes no obligation to update such forward-looking statements or to update the reasons why actual results could differ from those reflected in the forward-looking statements unless and until required by securities laws applicable to the company. Additional information identifying risks and uncertainties is contained in filings by the company with the Canadian securities regulators, including without limitation, the company’s management discussion and analysis for the quarter and 12 months ended December 31, 2023, which filings are available under the company’s profile at www.sedar.com.
During this call, the company may reference adjusted EBITDA, constant currency and organic growth as non-IFRS measures, which are used by management as measures of financial performance. Please see the sections entitled Use of Non-IFRS Measures and Results of Operations in the company’s management discussion and analysis for the periods covered for further information and a reconciliation of adjusted EBITDA to net income. We also ask that you please note today’s conference is being recorded.
Now let me turn the call over to Hamilton Thorne’s Executive Chairman, David Wolf. Please go ahead.
David Wolf
Thank you. Good morning and welcome everyone. As most of you know, I’ve had the privilege of hosting the Hamilton Thorne conference call pretty much since we went public. During this period, our company has progressed from a relatively small niche player in the assisted reproductive field to one of the largest providers capable of providing virtually any product that is required in the IVF lab. As we’ve grown, it’s become clear though I think I have done a decent job of leading the company has gotten us to this point, new leadership with renewed energy and vision will take this company forward into the future and get us the leadership position that we deserve.
With that said, it’s my pleasure to introduce Dr. Kate Torchilin. Kate took over as CEO in mid-January and will be leading today’s call.
Kate Torchilin
Thank you, David. I have very big shoes to fill, and I’m honored to have joined Hamilton Thorne. Good morning, everyone. Welcome to Hamilton Thorne Limited fourth quarter and full-year 2023 earnings conference call. I also would like to introduce Francesco Fragasso, our Chief Financial Officer, who is on the call with us. This morning, we will have the following format. First, I’ll provide a summary of results for the quarter and 12 months ended December 31, 2023, with a focus on our sales, markets and operational performance.
Francesco will follow with a more detailed discussion of our financial results for the period as well as a review of our financial position and liquidity. I will then return for a few minutes to provide some information on our outlook for Q1 2024 and a few comments on 2024 overall. Before I go into the sales results, I would like to briefly introduce myself again and reflect on my first month at Hamilton Thorne. As David mentioned, I joined Hamilton Thorne as CEO and President on January 15 this year.
I’m originally a scientist by training with Ph.D in biochemistry as well as business degree. And before joining Hamilton Thorne, I have about 20-plus years of experience working with or leading life sciences and health care businesses, including spending more than a decade at Thermo Fisher Scientific, where over the years, I was responsible for the development, manufacturing, and global commercialization of their cell culture cell therapy and chemical businesses. And early in my career, also worked in corporate M&A team at Thermo Fisher. I also led Connected Health and Women’s Health businesses at Alere, Inc., including responsibility for their global business in diagnostic testing, supporting healthy pregnancy.
Since joining Hamilton Thorne, the last two months have been an exhilarating time in getting to know our polices globally, meeting many of our customers and many of our investors. I’m deeply impressed by the dedication of our talented colleagues to supporting our customers with best-in-class products and services by the commitment that our team has to continued improvements in the field of infertility treatment and playing our part in helping millions of families globally fulfill their dreams of having a baby.
I began to work with our leadership team to revise and update our five-year strategic growth plan. Our vision is to continue to build Hamilton Thorne into the premier company serving IVF and ART laboratory. And in the coming months, we will further fine-tune our strategy and priorities in products, regions and investments. We look forward to socializing this plan with our investors, you all, during an Investor Day that we are planning for September 2024 and we’ll circulate the details for the Investor Day at a later point.
Now moving on to our results. 2023 was a record year for Hamilton Thorne. Sales were up 16% for the year, increasing primarily due to the addition of Microptic sales, a return to more normalized operations as compared to supply chain and logistics disruptions affecting the prior year, along with continued growth in our core businesses and markets, and despite slowdown in China for the majority of the year.
Q4 continued that positive momentum with sales up 12%. Sales increased 14% for the year and 8% for the quarter on a constant currency basis and organic sales growth was approximately 9% for the year and 7% for the quarter, reflecting continued strong demand for our products globally. Gross profit for the year increased 16% for full 2023 and as a percentage of sales was 50.4% as compared to 50% in prior year, due to increased sales of higher-margin proprietary equipment, branded consumables and additional direct sales of products, partially offset by the high material costs caused by the global inflationary environment.
Gross profit percentage for fourth quarter was down versus the prior year, primarily due to product mix and an increase in distributor sales within the quarter of our own branded products. For full 2023, EBITDA remained stable at approximately 17% despite our continued investments in our business. In Q4, despite slightly lower gross profit margin, EBITDA margin actually improved to 20% due to increased sales and slowing down in operating expense growth, just as we were planning.
Service, Software and Consumable sales were up 22% for the year. Consumable sales in ’23 outpaced the company growth overall despite being affected by the recall of certain products by one of the company’s contract manufacturers. And this reflects continued strong demand for this largely high-margin recurring revenue categories in our portfolio. Specifically to Gynetics acquisition that we completed last October is a consumable business and very important addition to our business. Acquisition is going smoothly, and we’ll be providing further update through 2024 when Gynetics will be contributing to the full-year. Sales of equipment were 8% higher than last year.
During the year, we faced a significant reduction in equipment sales in China due to several factors, including economic slowdown in that country, the enforcement of Buy Local policies combined with the emergence of local competitors and delay in regulatory clearance. Although we did have — although we have seen growth in China actually stabilizing in Q4. Overall, in ’23, we made a good step forward towards delivering on our strategy of increasing our direct versus distributor sales and the increasing contribution of consumables, software and services to our revenue mix.
Both of these categories, direct and consumables and software were higher as a percent of sales in ’23 as compared to 2022. On a geographic basis, EMEA — Europe was our strongest performing region in 2023, followed by Americas. Sales in Asia Pacific region were strong, although offset by a slowdown in China during majority of ’23.
I will now turn the call over to Francesco to provide a more detailed discussion on the numbers.
Francesco Fragasso
Thank you, Kate. Good morning, everyone. I’m Francesco Fragasso, CFO at Hamilton Thorne. I will briefly highlight the fourth quarter 2023 financial results. Kate has already provided an update on sales and gross profit, so I will focus on the other elements of the income statement as well as the cash flow and liquidity of the company.
Operating expenses, excluding expenses related to M&A activity, increased 13% for the quarter and 21% for the 12 months ending December 31, 2023 to $7.6 million and $31.3 million, respectively. If we analyze the 21% annual increase or $5.5 million additional, $2.3 million was due to the addition of Microptic expenses for the full-year and Gynetics expenses in Q4. $1.1 million was due to increased depreciation and amortization associated to the assets acquired with the acquisitions and investment made in expanding capacity, while the remaining $1.1 million increase was related to investment in sales and other personnel to support growth.
The return to pre-COVID level for the sales and marketing activities is also a factor for expenses increased in Q4 and the 12 months of 2023 compared to the same period of 2022. Increases in operating expenses were in line with our expectations. During the prior quarter, we implemented several cost containment strategies to manage the inflationary pressure on operating expenses.
Those strategies started producing benefit in Q4 and are expected to continue to improve our overall financial performance in the following months. Net interest expense in Q4 2023 increased by $938,000 to $1.4 million due to additional term debt incurred to finance Microptic acquisition in November 2022, Gynetics acquisition in October 2023 and a higher use of a bank line of credit to fund working capital, partially offset by the repayment of outstanding principal on term loans.
Income tax expense decreased to $503,000 tax recovery for the year ended December 31, 2023, compared to $89,000 tax expense in 2022, primarily due to the net loss in fiscal year 2023 compared to the net profit in fiscal year 2022 and to the increase in deferred income tax recovery from — to $944,000 in 2023 compared to a deferred income tax recovery of $650,000 in 2022. The change in the deferred taxes relates to the temporary differences between income tax value and the carrying value of assets and liabilities. Net income for the fourth quarter of 2023 was $540,000 compared to a net income of $980,000 in the prior year quarter. Net loss for the 12-months period of 2023 was $607,000 versus a net income of $1.9 million in the prior year’s period. This is primarily due to increased operating and interest expenses as I previously mentioned partially offset by a decrease in income taxes.
Adjusted EBITDA, which we consider an important metric of our financial performance, increased by 22% to $3.7 million for the fourth quarter of 2023 and increased 14% to $11.5 million for the 12-months period of 2023, reflecting growth, improved gross profit margin and increased operating leverage. As a reminder, adjusted EBITDA is a non-IFRS measure. Please see the reconciliation of adjusted EBITDA to net income for the quarter and the year in our management discussion and analysis report filed today on both SEDAR and our website.
Turning now to the company cash flow and balance sheet. The company cash balance at the end of December 2023 was $9.7 million compared to $16.7 million at the end of 2022, a decrease of $6.9 million. The decrease in cash balance was primarily due to the payment related to the Gynetics acquisition, investment in working capital to support expected growth, the investment in product development and in the expansion of our manufacturing capacity and payments related to M&A activities. The company generated cash from operations of $4 million in the 12 months of 2023 compared to $2.3 million operating cash flow generated in the same period of 2022. Of the $4 million generated cash flow — operating cash flow generated in 2023, $2.5 million were generated in Q4.
In the 12 months of 2023, cash used in investing activity was $17.5 million. Of this, $2.8 million related to the normal expenditure in PP&E and for ongoing investment in capitalizing tangible of product development activities and $0.9 million related to leasehold improvement, equipment and furniture for the expansion of our manufacturing capacity in some of our operating business units. Cash flow improved in Q4 as investment in expanding capacity has been completed and inventory has decreased. This trend is expected to continue in the following months.
Cash used in financing activity was $6.3 million for the 12 months of 2023. Those were mainly related to the $7.8 million advance taken under the acquisition line of credit in connection with the Gynetics acquisition, $2.4 million increased use of company working capital line of credit offset by payment of scheduled term loans and lease obligations. Note payables and term loans outstanding totaled $21.6 million at the end of December 2023, equal to 1.9x the reported adjusted EBITDA or 1x if we consider the available cash at the end of the year 2023. At the end of 2023, the company has a strong liquidity position of $14 million, including $9.7 million in available cash and $4.3 million in unused borrowing capacity. We are in the process of discussing a renewal of our M&A line of credit with our bank, which will provide us with additional liquidity.
I will now turn the call back over to Kate to comment on the Hamilton Thorne outlook.
Kate Torchilin
Thank you, Francesco. As we look ahead, we continue to feel that our company is in a strong position as demand for our products and services remain solid based on the positive trends in our industry. We believe that somewhat soft organic growth in the last couple of quarters is temporary, and the company should return to double-digit organic growth in the first half of ’24 and continuing through the longer term. In order to provide our investors with additional visibility on our expected results, we have decided to begin issuing more into the guidance on sales and EBITDA. We’re expecting first quarter of ’24 reported revenues between $19 million and $19.4 million with organic growth for the quarter of approximately 8% and EBITDA margin of approximately 18%.
For the full 12 months of ’24, we anticipate delivering between $78 million and $82 million revenue, equivalent to 10% to 15% organic growth for the full-year and adjusted EBITDA margin in the range of 18.5% to 20.5%. Please note that while we expect to continue to make acquisitions since the size and timing of those are hard to predict, we haven’t included any further acquisitions in our guidance. In 2023, we made significant investments in our operations to facilitate long-term growth.
Management is committed to EBITDA margin expansion, and we anticipate tighter operating expense control in ’24, while continue to leverage our larger scale. As mentioned, we anticipate first quarter of ’24 to be our lowest EBITDA margin quarter in 2024 at approximately 18% with margins then improving throughout the year. Cash flow is expected to improve as the investment in expanding capacity has been completed and inventory will decrease in the following months.
We continue to focus on building Hamilton Thorne into a premier company serving IVF and ART laboratories globally. We have an extensive pipeline and are actively working on multiple acquisition opportunities with significant cash on hand, as Francesco laid out, and our unused line of credit as well as further debt capacity, we believe we’re well positioned to continue to execute on our acquisition program. In summary, we feel extremely positive about our market position and are confident in our team’s ability to execute on our strategy and to drive long-term growth and EBITDA expansion by investing in our organic growth while building scale, enhancing our product offerings and expanding our geographic and direct sales footprint through acquisitions.
Thank you very much, and we will now open up the line for questions.
Question-and-Answer Session
Operator
Thank you. [Operator Instructions] Today’s first question comes from Kyle McPhee with Cormark Securities. Please go ahead.
Kyle McPhee
Hi, everyone. Thank you for taking my question. First on, Hamilton Thorne just slipped through a period of abnormal cost inflation and that likely dictated the need for abnormal pricing gains. So as you have progressed through this period of time, went to your clients to take your pricing gains, have you noticed any changes with respect to Hamilton Thorne’s pricing power for any pockets or regions of your business relative to the company’s historical experience?
Kate Torchilin
Thank you, Kyle, for the question. This is Kate. So I think the last couple of years, just as you mentioned, it was probably abnormal across many industries, including ours. And I think we saw both the needs as well as receptiveness in our customers to take somewhat more price than in the previous year’s kind of before pandemic. And so I think especially around our equipment, I think those were the years where we were raising prices somewhat higher than in the prior years as well as we continued with moderate price increase on our consumables.
So I think that generally now is normalizing to historical like single percent price increases generally. And we, for sure, will continue to explore the opportunities to price our kind of products appropriately. But generally, we look at kind of pricing as a margin maintenance in our field, right, especially as we’re trying to substantially increase our penetration in the market. Thank you.
Kyle McPhee
Okay. Thank you for that color. Just on gross margins, I’m thinking about the mid-term direction for your gross margin percentage and how it might contrast what we’ve seen over the last few years. It seems like organically, you’re set up with higher margin categories delivering the higher growth for slower margin categories and set up with runway to shift more sales from distributors to direct on the back of some of your recent M&A that opens synergy runway. Do these favorable moving parts for gross margin percentage sound right to you? And are there any material offsets to this type of trend that I’m missing?
Kate Torchilin
I think it’s generally correct, and I will let Francesco also to comment some more. But I would say the product mix and direct versus distributor are the highest contributors to margin — to gross profit expansion that we anticipate.
Francesco Fragasso
Yes. No, that is — on the gross profit as a percentage, there are a lot of details to consider. One is the channel to the market. So growing in the region where we use distributors that increase the sales, but reduce overall the margin as a percentage. So there are those factors that impact our profitability as from a percentage point of view.
Kyle McPhee
Got it. Thanks. And last quick one, just on the topic of free cash flow conversion. Can you offer some color on CapEx spend in 2024 for PP&E and capitalized R&D?
Francesco Fragasso
Yes. Absolutely. Actually, we disclosed that in our MD&A. As we said, before, we are now in a more normalized level of CapEx. We completed a significant expansion, not only in manufacturing, but also in the warehousing space, which is needed for increasing consumable. Going forward, our normal level of CapEx is around $2.4 million. This includes what has been historically an average investment in product development of about $1.3 million. So the balance $1.1 million is our, let’s say, maintenance level and supporting growth without any particular extraordinary project.
Kyle McPhee
Okay. Thank you. That’s it for me.
Operator
Thank you. And our next question comes from David Martin at Bloom Burton. Please go ahead.
David Martin
Good morning, Kate, Francesco, and David. Kind of linking on to the last question, you mentioned the investments in the warehouse and the manufacturing. So you have more capacities to sell, what are the catalysts that are going to get the increased sales now on the expanded infrastructure? And what’s going to get you back to the double-digit organic growth? What are the catalysts there?
Kate Torchilin
Yes, thank you. I can take that. So I think at the highest level, continued increase in performance and effectiveness of our commercial team, combined with select additions of direct sales in countries and regions where we feel the highest potential is where we will focus. We — with the beginning steps of a journey of really fully leveraging our whole portfolio in each of our regions, so we think that will be kind of a really important driver to be able to, in each region, consistently to all of our customers more than just several products.
We anticipate to kind of fully leverage the growth in regions where we see the highest growth including various Asia Pacific countries, as well as there were some specific things affecting partially ’23 results, such as recall on several consumable product lines that are now going to come full on the market in the beginning of Q2.
David Martin
So would it be fair to say you’ve been capacity-constrained up until now and now you’ll go forward with less of a capacity constraint?
Kate Torchilin
Yes. No, I don’t think we were necessarily capacity-constrained, but I think we also did the right thing to invest somewhat ahead, so that we can continue delivering as well as not just send products out, but send them out on the lead times that are expected by our customers and so on. So I think it was investing ahead rather than trying to address any kind of acute problem that we had. But Francesco…
Francesco Fragasso
As you know, this is not a capital intensive production business. And especially on consumable, it is mainly a distribution business model. So you have to expand your capacity in steps. You cannot do it gradually. So you can — you have to do it when you have the opportunity because not facility don’t become available near you when you need them. So we had several opportunities. Looking at our future plan, I think we were able to secure the capacity that we will use for the next three to five years, probably because really, the space at the end is our only asset that is required both in equipment manufacturing and in consumable.
David Martin
Okay. Thanks. You mentioned China is stabilizing. Is that related to the economy turning around? Or is there an easing of the Buy Local? Are you somewhat surprised that it would be turning around, it seem like those things were going to be fairly constant going forward?
Kate Torchilin
I think general economic outlook is probably relatively better, macroeconomically speaking, for ’24 than it was in ’23 as well as there were continued and probably strengthening tailwinds in China driving interest in generally population having babies and expanding population that is going to rise IVF and ART, both as well. So we see that those are the positives. I think Buy Local will continue in the coming years, but the longer various rules are implemented, the more clarity it is for hospitals and clinics that buy the equipment from vendors like us or what it actually means and what’s possible, what’s not possible. So I think all of that is leading to generally stabilizing of the environment and then resuming growth from that new base.
David Martin
Okay. And just one last quick question, if I can. Any major changes in EMEA or the U.S. markets that you’ve seen recently?
Kate Torchilin
I don’t think we can point to any specific. Europe remains very large base, as you probably know and so continues its growth. In the United States, we went through consideration around Alabama ruling that had some potential to affect infertility treatments in some select states. That seems to have been very quickly, I would say, addressed and mitigated by follow-on legislature in that state. So we see just continued steady growth in both of these regions.
David Martin
Okay. Thank you. And that’s it for me.
Kate Torchilin
Thank you.
Operator
Thank you. And our next question comes from Justin Keywood from Stifel. Please go ahead.
Justin Keywood
Good morning. Thanks for taking my call. Just on the organic growth in Q4, 7% versus the guide at 9% to 10%. It sounds like it was mainly related to headwinds in China, if that’s accurate. And then also on the guide for the first half of 2024, of double-digit organic growth, whereas Q1 is 8%. So that suggests a pretty robust organic growth figure in Q2. And just trying to understand the justification around that, if there’s visibility in perhaps a large equipment sale that will show up in Q2? Thank you.
Kate Torchilin
Yes, I’ll let Francesco talk about Q4, and then I’ll address Q1. Thank you.
Francesco Fragasso
Justin, when we anticipated several shipments to be completed by the end of the year, some of those delayed. From a dollar point of view, this was about $600,000, which is the difference between a 7% and 9% organic growth. So I will say, more of a cutoff issue that, as you know, Q4 is our highest quarter, especially for equipment. It just happened that few large orders were still in transit at the end of the year, although they were picked up from our facility. So there wasn’t anything in particular other than this logistical cutoff. And Kate, if you want to cover that one.
Kate Torchilin
Yes, I think, going to the general outlook of 2024 as well as Q1. So I think what we’re seeing rather than any particular big event with any type of our equipment or anything like that is a general returning of several factors, right? As we told we anticipate China is now being kind of stable and resuming some growth. The products that we faced part of our consumables portfolio that was on the recall in ’23 is now coming back to market and we anticipate that providing positive impact.
We continue to focus very heavily on cross-selling and increasing kind of expectations on the performance of our commercial team. So that — all of that combined, right, leads us to believe and the fact that the year is going to be double-digit growth year. Q1 specifically had several things impacting it, right? And one is our comparable to Q1 of ’22, Q1 — sorry, ’23 was our highest growth quarter last year. So comparable just quarter-on-quarter comparison makes it kind of little hard, right, to achieve very high double-digit growth. There is definitely continuous lumpiness in our equipment sales patterns that we’ll also see.
And then finally, it’s a little bit of a shorter quarter with Easter holiday heating at the very end of Q1. And so that’s kind of — that’s the combination of why we’ll end Q1 as we do.
Justin Keywood
Thank you very much. And then just the exposure to China, if you have that as a percentage of total sales? And then I thought I heard that there’s still good opportunity in Asia Pacific. So I assume that’s outside of China. If you can detail that, please. Thank you.
Kate Torchilin
Yes. So I think — thank you. Generally, China is probably under 5% of our overall revenue mix. We talk about it a lot because it’s just such a substantial infertile market for infertility globally, right? And so we, for sure plan to keep establishing ourselves as a very relevant player there. But as things developed in the last couple of years, it’s fairly small base that we currently have in our revenue mix. And I think the rest of Asia Pacific, right, we continue to see first very positive momentum in markets generally as well as continued penetration from our businesses. And so like looking at countries like Japan or Vietnam or Thailand or India, right? Those are all kind of countries to which we are paying close attention.
Justin Keywood
Thank you. If I could just slip in one more. On the Alabama Supreme Court ruling, do you anticipate any material headwinds there? And if you have any comments on that? Thank you.
Kate Torchilin
Yes. No, absolutely. Thank you. So that specific Alabama ruling, I think it would be as it stands in itself was going to have very minimal effect on our revenue in general, I would say, infertility market in United States because Alabama has eight not very big clinics and the total number of cycles, IVF cycles that they do in the state is less than half of 1%. So it was fairly contained from that point.
But obviously, people looked at it and say, okay, does it set up a precedent for other states that might pass other similar regulations. And that’s where, I think, how quickly everybody came together, patients, industry lawmakers from both sides of the aisle to pass follow-up legislation that basically allows clinics and infertility procedures to continue in the state. I think gives us an expectation that it will not going to be affecting negatively any other states in the United States. But of course, it’s something we’re going to observe very closely.
Francesco Fragasso
Do you mind If I add something.
Kate Torchilin
Yes. Sure.
Francesco Fragasso
I’m sorry, to Justin’s statement, just to add one thing. Even yesterday, there was a special election in Alabama and a candidate ran explicitly, it was proabortion, but also pro-IVF campaign and a Democrat beat a Republican. So it’s very clear that the — we’re not ignoring it by any stretch, but it’s very clear that the overall political trend is pro-IVF and this felt like a very outlier kind of case.
Justin Keywood
Sounds pretty contained. Thank you very much for taking my questions.
Kate Torchilin
Thank you, Justin.
Operator
And our next question comes from Stefan Quenneville with Echelon Capital Management. Please go ahead. I’m sorry, Capital Markets. Please go ahead.
Stefan Quenneville
Hi guys. Thanks for taking the question. Can I ask you just a bit about the M&A environment that you’re seeing right now? How are the opportunities looking? And now the case in the seat for a couple of months, is there any reprioritization of potential targets?
Kate Torchilin
Yes, absolutely. Thank you, Stefan, for the question. So I think generally, we see M&A environment to continue to be very positive that our industry is exciting one and some growing one. It’s also highly fragmented one with many smaller companies and some like few bigger companies with really kind of interesting portfolios.
And generally, I would say, over the course of the years, and David might add some color from his experience. General increase of interest in founders as well as more receptiveness that some kind of aggregation and M&A is one of the options for growing the businesses. So I think that is creating quite positive momentum. I think we continue to look across the spectrum of everything for infertility lab with somewhat high preference towards consumables and software objectives, our last two acquisitions, Microptic being largely software acquisition, Gynetics being largely consumables acquisition kind of examples, right, of the businesses we’re particularly interested in. And so that, I think, will continue as well.
Stefan Quenneville
Okay. Great. And just maybe one more kind of high level question. Again, you’ve been in the seat for a couple of months. Do you have any kind of key observations or reflections about the industry and the company? And do you see any specific opportunities for Hamilton in that environment that you’d like to highlight now that you’ve sort of gotten your sort of hands dirty and under the hood a bit and seen the operations sort of first hand for a few months?
Kate Torchilin
No, thank you. As I also mentioned, I think, we’ll be kind of more formalizing the views and also sharing them at the midpoint in the year on the Investor Day, where I think we’ll go into a little bit more detail as well as general kind of longer-term outlook on where we see opportunities for our company. But my first impression is first that the industry, obviously, is tremendously exciting industry with a lot of scientific innovation, but really such a significant impact on human health and health of families and happiness of families that globally. We have what I think is a very talented team, very passionate about what they do and very passionate about helping our customers in fertility labs to do the best they can.
At this point, I visited probably like more than 80% of all of our kind of sites and met more than 80% of our colleagues, really impressed with just the quality and passion of our global team. And I think we generally continue to believe and kind of I would be reinforcing that as the year progresses in our strategy of becoming a premier player for being serving IVF and ART laboratory with everything they need, and that includes precision instruments and equipment and consumables and software and services. And so there is enough, I think, enough to do there in that segment, and we’ll continue to stay true to that.
Stefan Quenneville
Great. Thanks for that. That’s it for me.
Operator
Thank you. And I’m showing no further questions at this time.
Kate Torchilin
Thank you. Thank you, everyone, for joining the call, and we look forward to reconnecting throughout the quarter, and then definitely, again, at our Q1 earnings release. Thank you very much for your questions and for supporting Hamilton Thorne.
Operator
Thank you, ma’am. This concludes today’s conference call. We thank you all for attending today’s presentation. You may now disconnect your lines, and have a wonderful day.
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