MindWalk Holdings Corp. Q4 FY2025 earnings call

• Fiscal year 2025 was a standout year with record Q4 revenue and improved gross margins. - BioStrand segment grew over 180% YoY in fiscal 2025 with near 90% gross margins. - Q4 2025 adjusted EBITDA narrowed to $316k from $1.7M in Q4 2024. - Canadian business had strong Q4 growth: sales orders $4.3M, YoY sales up 47%, new clients orders up 93% YoY. - Divestiture of Dutch subsidiary in final stages, rebranding planned to bio-native AI platform. - Key milestones include collaborations with RIBOPRO and a biotech partner, platform validations, vaccine program advances, GLP-1 peptide results, NASDAQ compliance, and new board/advisory appointees.

For the fourth quarter of 2025, ImmunoPrecise Antibodies achieved $7 million in revenue, the highest quarterly revenue in the company's history, with a gross margin of 64% (up from 48% in Q4 2024). For the full fiscal year ending April 30, 2025, gross margins expanded from 49% to 55% (a 600 basis point increase). The BioStrand segment was a key driver, growing over 180% year-over-year in fiscal 2025 with gross margins approaching 90%. The Canadian business had strong growth in Q4 2025: sales orders reached $4.3 million (more than double historical quarters), year-over-year sales in Canada increased by 47%, quarterly orders were up 83%, and orders from new clients rose 93% year-over-year and 80% quarter-over-quarter. Adjusted EBITDA in Q4 2025 was a loss of $316,000, a significant improvement from a loss of $1.7 million in Q4 2024.

• Expect BioStrand to remain a strong top line contributor and support margin expansion. - Anticipate revenue from oncology partner to be visible in Q2 2026 fiscal year. - Divestiture of Dutch subsidiary near-term completion, rebranding post-completion.

• Forward-looking statements subject to risks like global political/economic factors, market conditions, unforeseen business risks. - Divestiture timeline extended slightly beyond original expectations.

Q: A couple of questions from me. Actually, congratulations on generating high efficiency, the GLP-1 peptides that you were talking about in your opening remarks. So in terms of clinical development, what should we expect for them? And also, how do you plan to monetize this asset?

A: RK, this is Jennifer. Thanks for joining us. And thanks for your question. So first of all, in terms of development, we have 2 partners that we're working with at the moment, one of them very specifically on the actual drug product manufacturing as well as formulation and then an additional partner who actually brings about novel ways to administer the drug product in a unique route of administration. And that partner is actually working with us not only on dosing escalation analysis and formulation, but also has done the preclinical design and validation in terms of how we will execute on preclinical IND-enabling data to support translational work and clinical design. We ourselves actually do not intend to take this product into the clinic. We do have an interested party who contacted us on the day of the very first press release with GLP that we are focused on demonstrating some of these initial formulation study and dose-dependent responses to where our hope and anticipation is that we will be bringing along a financial sponsor that will then sponsor this in the clinical setting.

Q: Then regarding the biotech partner that you're working with on the oncology assets. So for you to start recognizing some of the initial payments of the $8 million, what sort of milestones do you need to achieve? And if you're unable to spell out the milestones, at least what's the kind of cadence that we should expect for that $8 million? Can we see something in the fiscal year '26? Or is it like one big lump payment that you will get at the end of whatever you were supposed to be doing in terms of the product?

A: Yes, that's a good question. Yes, that's a good question, RK, and I can appreciate that from your analyst perspective, too, looking to see when some of these financial components will start to hit the books. So it's definitely not all in one lump sum, actually, so we have just -- we are closing out on Thursday of this week, of course, our first quarter. We anticipate a significant amount of this program to actually be visible in our second quarter. So we're launching quite a number of programs simultaneously for this particular partner that will then be moving through to a more advanced stage where we draw down and recognize that revenue in Q2. So that's the time when I would expect you'll start seeing the impact from that particular partner in this coming quarter. And then in terms of milestones, we really don't have like -- I mean, we have the usual milestones we have when we build a therapeutic for anyone, but we don't have any milestones that are deal breakers here or anything unusual. So we move through our process. As we go, we always are very transparent in sharing that data with any given client to demonstrate the quality of the work and the product as it moves through the process. And technically, every program we have has go/no-go aspects, but we have approaching 100% success rate on these platforms. So it's pretty rare that something doesn't continue to move through. So this program is similar in the sense that we're using highly validated platforms, and we don't have any particular set places where we have a unique milestone that could end up triggering the halt or the completion of the program early.

Q: And then you -- we are all aware of the FDA's guidance of trying to move to AI-based systems for preclinical drug development. So since that announcement had come out from the regulatory agency, what sort of traffic have you seen inbound for your services? And is there any way we can gauge as to how much the LENSai platform will start getting used in '26 -- your fiscal year '26? Because you said in the PR that only 5% of your annual revenues at this point is coming from the AI side of business. So I'm just trying to see how quickly can that grow? And what magnitude could it grow to?

A: Yes, that's a great question as well. So I think we've got a lot of eyes on the direction that people with kind of earlier-stage preclinical work are going in terms of FDA guidance and applications. We have, through some of our peer groups recognize that there has been at least a couple of early-stage purely in silico work that has supported some unique cases already in their approval for clinical use from the FDA. But overall, that's probably a few years out before we get a firm transition in that space. So we've been curious as well as to how this type of work will transition to what we're doing at BioStrand. So we've definitely had an increase on inquiries in the particular areas that are very directly related to IND applications when it comes to clinical safety, patient safety and uniqueness of patients being enrolled in studies. But the area where we have seen really the most dramatic and material change is kind of an interesting one because it corresponds as well to some of the more recent platforms that we've been fairly vocal about. So this includes our immunogenicity platform and then -- which includes, of course, the analysis of these ADA responses and epitope mapping as well. And it's interesting because it's difficult for us to know how much of that, even in communication with our clients is due to the regulatory changes and people's ability to very rapidly and less expensively and to very accurately bolster the information that is going into their IND applications and dossiers, whereas previously, those were kind of rate-limiting and time-consuming steps. But interestingly enough, obviously, these do also provide significant reassurances and support sometimes with aspects of an IND application that people did not previously bother to do because of the time and the expense, where now they're able to get more data and create a more data-rich dossier for the application to support IND work. So it does correspond as well with not only when we were able to go out and showcase these capabilities, but when we were able to take them publicly into the conference realm and share them with people in the industry. We saw a very, very rapid uptick of people coming in to utilize things like epitope mapping from BioStrand. So in response to your question, the inbound traffic has been quite significant. It's not traffic coming in to replace IND applications, but instead to bolster them with data that they might not otherwise have had that might have been too cumbersome or time-consuming for them to retrieve. And going forward, for the second part of your question, we definitely expect that trend to continue. But there are other aspects of BioStrand that we also believe will continue to grow. So kind of across the board in these core capabilities, this overall uptick that we've been seeing, we do expect that to continue into the next fiscal year only to be bolstered and supported by these newer applications that are gaining traction as well.

Q: One last question from me. Just would like to understand if the divestment of the European facilities, how far into it are you at this point? And also regarding your base business, there were some transfers happening between Europe and the Canadian facility. Is that all done? And then is the Canadian facility able to have enough resources for the work that you do?

A: Yes. Great question. So how far along are we? We are extremely far along in the process. So I mentioned we do have one kind of dedicated buyer. We're really in the last stages of agreement in the sale and purchase agreement. So we're extremely far along in this process and really down to the finer details of what needs to happen upon closing and post closing for the full independence of both of these locations for buyer and seller. With regard to Canada, so this is actually quite interesting. You can see the rapid growth we've had in Canada over the last quarter or 2. It really is faster growth than we've ever seen in any of our sites ever in the history of IPA. They are able to take all the work that is coming in, even though they are quite full. And in part, they're able to -- we're able to rely on Canada to continue to take this work because of the expansion that we've been doing in Canada. That expansion continues through fiscal year '26. And we had a very, very small number of programs that were really going between the location in Canada and in Europe. And so we do not expect any sort of impact to Canada in a detrimental way there, but instead have found that we have been able to ensure that we can continue to take on all programs holistically from beginning to end, whether it's diagnostic or therapeutic in nature. And in addition to that, to also lean into the integration we've got done for the in silico work into the Canadian site. So I think we only mentioned on this briefly previously, but about a year ago, we did begin the integration of LENSai applications into the Canadian site in a selected manner, which could really enhance and bolster the data packages coming out from Canada. And we completed the transfer of those applications in whole. So they're actually being added to quotes and are a designated official part of all of our therapeutic programs. That actually happened last March. So we're also just beginning to see the impact of that, which serves obviously not only to enhance the programs that we're offering, but to also ensure that every one of our clients is having the benefits of those in silico applications as well as the exposure to what those in silico applications can do for their work. So in short, base business will continue to go strong with Canada. Canada and BioStrand are in a really good position as we look at their pipelines moving forward, again, stronger than we have ever seen in this company in terms of the growth from quarter-to-quarter and year-over-year and the number of new clients blocking very specifically to that location. And the divestiture, we were looking to see that quite rapidly here as we just go through the final details in the sale, purchase agreement over the next week or so.