Neogen (NEOG) Q3 2025 Earnings Call Transcript

Motley Fool Transcribing, The Motley Fool

Thu, April 9, 2026 astatine 8:21 AM CDT 43 min read

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Wednesday, April 9, 2025 astatine 8 a.m. ET

• Chief Executive Officer — John Adent

• Chief Financial Officer — David Naemura

John Adent: Thanks, Bill. Good morning, everyone, and invited to the net telephone for the 3rd 4th of our 2025 fiscal year. You whitethorn person seen the property merchandise issued earlier contiguous announcing that I volition beryllium stepping down arsenic CEO. It's been an grant to pb Neogen and I'm incredibly arrogant of the squad we've built and everything we've accomplished, including making a important magnitude of advancement connected the analyzable integration of a transformational acquisition. I would similar to widen my sincere gratitude to the squad for each their hard enactment and sacrifice implicit the past respective years and firmly judge these efforts person enactment the institution successful a stronger position.

I volition stay successful my relation portion the Board conducts a hunt for my successor, and I'm afloat committed to ensuring a creaseless modulation for our customers and employees. With that down us, let's determination into immoderate colour connected the quarter. Over the people of the 3rd quarter, we saw the wide improvement of uncertainty, chiefly related to the goals and policies of the U.S. government, astir notably deregulation, authorities spending cuts, tariffs and planetary trade. As we've each seen, the medication is aiming to trim national spending that has made cuts crossed a fig of authorities agencies, including those applicable to nutrient information similar the FDA and the USDA.

While these cuts could perchance impact the velocity with which outbreaks of food-borne unwellness tin beryllium addressed oregon perchance hold oregon destruct definite probe spending, we don't presently spot them arsenic having a important effect connected nutrient information testing. This is inactive a processing environment, but the leaning retired of these agencies could effect successful much investigating being pushed to the plants, which is wherever the eventual work lies for harmless nutrient production. Food quality, which by hold includes nutrient information appears to beryllium a precedence for the administration, and we judge it has the imaginable to beryllium a tailwind implicit time. The administration's presumption connected tariffs and the actions announced past week person added to this uncertain environment.

Despite astir fractional of our gross being generated extracurricular of the U.S., a important information of our manufacturing is based successful the U.S. As it relates to our purchases, the concern is similar. Within our nutrient information business, astir 75% of our nonstop acquisition walk is successful the U.S. In Animal Safety, the fig is astir 2/3 with our needle and syringe products having initially been subjected to tariffs backmost successful September of past year. While acknowledging the tariff scenery has been and tin proceed to beryllium fluid, we judge that our home manufacturing footprint provides immoderate level of installation successful this environment, peculiarly successful our largest markets, the U.S.