ImmuCell Q3 Earnings Call Highlights

Key Points

• Third-quarter sales rose 46% to $8 million, and ImmuCell returned to profitability with about $1 million in net income versus a $140,000 loss a year earlier. Higher manufacturing output and demand for First Defense products helped lift gross margin to 44.2%.
• Domestic sales increased 29.2%, while international sales climbed 573%, largely as Canadian back orders cleared. Management cautioned that the year-over-year comparison also benefited from distributor restocking headwinds in the prior-year quarter.
• ImmuCell is investing $8 million to expand manufacturing, including a freeze dryer expected to roughly triple freeze-drying capacity; initial work is targeted for completion in the first half of 2027. The company has paused further investment in Re-Tain after manufacturing and clinical hurdles.

ImmuCell NASDAQ: ICCC reported a 46% increase in third-quarter product sales and returned to profitability as improved manufacturing output and stronger demand supported its First Defense calf-health products.

The company’s unaudited product sales rose to $8 million for the quarter ended Sept. 30, 2026, while net income was approximately $1 million, compared with a $140,000 loss a year earlier. Gross margin rose to 44.2% from 42.9% in the prior-year quarter and 33.9% in the second quarter of 2026.

President and CEO Olivier te Boekhorst said the results reflected restored product availability, a favorable domestic calf market, increased commercial activity and supply-chain improvements. ImmuCell decided in December 2025 to focus on First Defense, its bovine scours preventative product line, after a prolonged period of supply challenges and back orders.

Sales Growth and Profitability

Domestic sales increased 29.2% year over year to $6.9 million in the third quarter, while international sales rose 573% to $1.1 million. CFO Timothy Fiori said Canadian sales accounted for most of the international growth, helped substantially by the clearing of 2025 back orders.

Fiori also cautioned that the large year-over-year sales increase partly reflected the absence of distributor restocking headwinds that had weighed on the third quarter of 2025. Distributor volumes grew 18% year over year in the latest quarter and 23% in the first nine months of 2026.

For the nine-month period, product sales increased 27.8% to $25.6 million. Sales of Tri-Shield, the company’s flagship product, grew 32.1%. Net income rose to $4.7 million from $1.8 million, although the 2026 figure included a one-time $2 million legal settlement from a former contract manufacturer. The prior-year period included a $427,000 insurance settlement.

Third-quarter adjusted EBITDA was $1.9 million, compared with $800,000 a year earlier. Sales, marketing and administrative expenses rose to $2.4 million from $1.6 million as the company invested in leadership and commercial activities.

Fiori said higher manufacturing output was the biggest driver of the sequential gross-margin improvement, with an August price change also helping. The third-quarter margin included approximately $400,000 of expenses shifted into cost of goods sold as ImmuCell repurposed its former Re-Tain facility and equipment for First Defense. That shift reduced the stated margin by 480 basis points, he said.

Capacity Expansion and Demand

ImmuCell has produced an average of approximately 435,000 manufacturing units per month in 2026, about 14% more than in 2025, te Boekhorst said. He noted that manufacturing units are a standardized production measure and are not equivalent to doses or revenue.

The company is investing $8 million to expand manufacturing capacity and had spent $1.7 million on the project as of Sept. 30, primarily on equipment. Fiori said the initial freeze-drying phase is expected to be completed in the first half of 2027, followed by the liquids processing expansion by the end of that year.

Te Boekhorst identified drying as the current bottleneck and said the planned freeze dryer should roughly triple freeze-drying capacity. Fiori said the new unit will be larger than the four dryers currently operating and capable of producing more than those four combined. Management believes improved yields can support demand until the expansion is completed.

The company has also expanded its commercial team to 13 people from nine since November 2025. Te Boekhorst said new customers contributed about 46% of net growth in the third quarter, with increased use by existing customers accounting for the remaining 54%. Dairy customers largely drove demand during the period, he said.

Re-Tain and Financial Position

ImmuCell stopped investing in Re-Tain, a product under development for subclinical mastitis, after its contract manufacturer was unable to obtain FDA good manufacturing practice approval. Te Boekhorst said recent clinical trials did not support incremental or new claims, and Re-Tain activities remain paused with no further investment planned.

He added that the company entered a minor licensing agreement allowing an aquaculture company to use its intellectual property for certain marine species, which may generate future cash flows.

ImmuCell ended September with $7.9 million in cash, $9.9 million in inventory and $16.9 million in working capital. Fiori said the company anticipated signing a new three-year, $3 million line of credit to replace a $1 million facility that expired in September. It also notified its investment bank that it was terminating an at-the-market sales agreement that had not been used since May 2025.

About ImmuCell (NASDAQ:ICCC)

ImmuCell Corporation is a biotechnology and animal health company headquartered in Portland, Maine. The company develops, manufactures, and commercializes products designed to support the health and productivity of livestock, with a primary focus on cattle. ImmuCell's products include FirstStep Calf Health, an on-farm diagnostic test that helps dairy and beef producers assess whether newborn calves have received adequate passive immunity from colostrum. The company also develops antibody-based products intended to help prevent or manage common diseases affecting young livestock, including neonatal calf diarrhea.

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