Standard BioTools (formerly Fluidigm Corporation) — FY2021 Form 10-K
Reporting period: Fiscal year ended December 31, 2021. The filing was submitted under Fluidigm Corporation; a proposed name change to Standard BioTools Inc. was conditional on a subsequent financing and stockholder approval. The filing reports annual results, not standalone fourth-quarter figures.
Business context
The company develops and sells life-science research tools, including mass cytometry and imaging systems, microfluidics instruments, consumables, reagents, software and services. Its customers include academic and government laboratories, biopharma and biotechnology companies, and clinical research laboratories. Manufacturing is concentrated in Singapore and Canada.
Financial performance
| Metric | FY2021 | FY2020 |
|---|---|---|
| Total revenue | $130.6 million | $138.1 million |
| Product and service revenue | $126.3 million | $122.5 million |
| Operating loss | $67.5 million | $51.0 million |
| Net loss | $59.2 million | $53.0 million |
| Net loss per share, diluted | $0.78 | $0.74 |
| Product and service gross margin | 51.5% | 55.3% |
| Cash used in operating activities | $44.1 million | $15.4 million |
| Cash, cash equivalents and restricted cash, year-end | $29.5 million | $69.5 million |
Revenue fell 5% year over year, while product and service revenue rose 3%. Consumables revenue increased 6% to $57.9 million and service revenue increased 15% to $25.9 million; instrument revenue declined 7% to $42.5 million. Net losses have persisted, and accumulated deficit was $736.0 million at year-end.
Product and service margin contracted 3.8 percentage points. Management attributed the decline to lower average selling prices for mass cytometry instruments, unfavorable mix from OEM instrument sales, lower COVID-19 consumables sales, and the absence of COVID-related government subsidies. Research and development expense was $37.9 million; selling, general and administrative expense was $98.9 million.
Revenue mix included $2.6 million of development revenue, $1.6 million of grant revenue and $0.1 million of license revenue, all down from FY2020. The company recognized $7.1 million of NIH grant proceeds in excess of expected project costs as non-operating income. The NIH contract’s total $34.0 million had been received and required milestones achieved by year-end.
Liquidity, debt and capital structure
Year-end cash and cash equivalents were $28.5 million, plus $1.0 million of restricted cash. The $15.0 million revolving facility had $6.8 million drawn and approximately $2.5 million available under its borrowing base. The $10.0 million SVB term loan was fully drawn. Debt carrying values included $54.2 million of convertible notes, $10.0 million of term debt and $6.8 million of revolver borrowings. The 2019 convertible notes have $55.0 million principal and mature in December 2024.
The company reported substantial doubt about its ability to continue as a going concern for at least twelve months after the financial statements were issued. Management said existing cash and committed facilities were insufficient to fund operations over that period and that continued operations depended on obtaining financing, improving efficiency, reducing spending and growing revenue. The auditor’s report also highlighted this going-concern uncertainty.
Material changes, outlook and key risks
- Revenue drivers: COVID-19 testing demand slowed from 2020 levels, reducing related instrument revenue. Base microfluidics revenue excluding COVID-19 increased 18%, supported by OEM instrument and consumables sales. Mass cytometry product and service revenue rose 9%, including sales of the CyTOF XT launched in May 2021.
- Operating conditions: Supply-chain constraints caused component shortages and unfulfilled demand during 2021. Management expected to meet product demand in 2022 but warned continued disruptions could affect supply.
- Subsequent financing and governance: In January 2022, Casdin and Viking each provided a $12.5 million bridge loan, fully drawn, and agreed to purchase an aggregate $225 million of convertible preferred stock, subject to conditions including stockholder approval. The proposed transaction could materially dilute existing holders; on an as-converted basis, the filing estimated the preferred shares could represent approximately 49.4% of post-closing common shares, before specified conversion limitations. A new CEO and company name change were also planned at closing. If the transaction failed, bridge loans could become convertible into common stock and carry escalating interest rates.
- Other material risks: Persistent losses and cash burn; reliance on limited-source suppliers and manufacturing sites; competitive and customer-spending pressures; international, trade and foreign-exchange exposure; regulatory limits on COVID-19 EUAs; and potential dilution from convertible securities. A securities class action was dismissed with prejudice in February 2022, subject to the plaintiff’s right to appeal.
- Audit and controls: PwC issued unqualified opinions on the financial statements and internal control over financial reporting, while emphasizing the going-concern uncertainty. NIH contract accounting was identified as a critical audit matter because of judgment in grant accounting, milestone assessment and classification of excess proceeds.
The filing does not provide formal numerical revenue, earnings or cash-flow guidance. Management stated it expected to meet product demand in 2022, subject to supply conditions; it also cautioned that future performance and the financing plan remained uncertain.
Investor verification priorities
- Confirm the status and closing terms of the $225 million preferred-stock financing, the bridge-loan conversion and the related stockholder approvals; assess the resulting dilution and control rights.
- Track cash burn, available borrowing capacity, covenant compliance and any financing or cost actions addressing the going-concern uncertainty.
- Verify whether supply constraints eased and whether the expected 2022 demand could be fulfilled without further production or margin pressure.
- Separate recurring product and service trends from declining COVID-19 testing, completed development/grant contracts and the non-recurring 2020 license settlement.
- Monitor gross-margin recovery, operating expenses and the company’s path toward reducing losses and negative operating cash flow.