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Avid Bioservices (NASDAQ:CDMO), a contract manufacturer for the biopharma industry, lost ~37% premarket Thursday after its preliminary Q3 results for fiscal 2024 fell short of expectations, and the company priced its newly launched convertible debt offering.
Its revenue for the quarter slumped ~11% YoY to $33.8M compared to $34.2M in FactSet consensus amid a decline in manufacturing runs and process development services from early-stage customers, the company said late Wednesday.
As for the outlook, Avid (CDMO) reaffirmed its full-year revenue guidance of $137M-$147M in line with $138.9M in the consensus. Meanwhile, its cash and cash equivalents slipped ~20% YoY to $30.7M from the end of FY23.
Later in the day, the company priced a $160M convertible note offering, issued as part of a private placement with certain institutional investors.
The company said that the 7.00% convertible senior notes will accrue interest semiannually and mature on March 1, 2029, unless earlier converted or repurchased.
Per the terms, the notes will have an initial conversion rate of 101.1250 shares of the company’s common stock available for the $1,000 principal amount of the notes.
The initial conversion price of ~$9.89 per share represents a ~13% premium to the last closing price of CDMO stock. The offering is expected to close on March 12, 2024.