Alpha Teknova, Inc. Common Stock Micro-Cap Virtual Conference

Great. Thank you, Jim, and thank you to the rest of the Sidoti team for having us here today. We are enjoying meeting with folks, and please reach out afterwards if you did not get a chance to get on our schedule. Happy to talk about Alpha Teknova today. We are at an exciting point in our growth story and happy to share with you what that looks like and take your questions at the end. I will also be using some slides here, and I may move fast through a few of them given the time that we have, but they are provided here for conference attendees on the conference website or in the IR section of Alpha Teknova's website. A little bit about Alpha Teknova. We are a leading provider of critical reagents for the discovery, development, and commercialization of novel therapies and diagnostics.

Reagents are liquids used in various lab workflows and bioprocessing workflows as well. We make a broad portfolio of products. Some would call this a picks and shovels type of business, and it is 100% consumable. We are excited to be where we are right now. We are 30 years in business. I will just mention that. It is a real milestone for the company. Five years as a public company, 30 years in business, and we are going strong. Just a little bit about that history. When we started in 1996, by a scientist from Genentech that left the company when he thought that he could do a better job of supplying these reagents to the company and to others in the industry. Started out with making catalog products, and selling those in a wide variety of formats.

This business grew for a long time by word of mouth, largely, and now developed a strong brand for serving the research and discovery markets, and we have over 3,000 customers annually buying from us in this product category. Along the way, we added custom capabilities to our portfolio that was very much appreciated by the researchers, and those have helped shape the company that we are today, to the point that we also had companies coming to us, asking us to be able to serve them beyond discovery and into clinical phases. In 2018, we received our ISO 13485 certification, which allowed us to sell products under GMP grade, or Good Manufacturing Practices grade, quality standards to help support customers that were going through clinical trials and also eventually commercialization.

This was an important milestone for the company, especially because it opened up a very significant and large addressable market, and one that we have been growing ever since. It also has a very attractive growth profile, especially as these novel therapies and diagnostics go through clinical trials and become commercialized products. in 2019, private equity firm Telegraph Hill Partners took majority control of the company and, in 2020, hired our CEO. He built out a leadership team that eventually took the company public in 2021. The purpose of that was to raise the capital to really develop the infrastructure to be able to serve this type of customer more effectively as they went through this process of clinical trials and getting towards commercialization. The idea was build it, and then build it so it could scale. That is what we have done.

Those investments were made over the several years following the IPO, and we have been maintaining our expenses after making some cuts a few years back to keep this infrastructure in place as we start to grow again. That is what we have done since 2025. We had 7% revenue growth, and we just reported Q2 revenue growth of 18%. We had the largest revenue in the company's history in Q2 of $12.2 million, to the point where we raised guidance for the year from $42 million-$44 million to $45 million-$47 million, as you see on this slide, growing in that mid double digits teens growth rate. We are very excited about that and what the future holds as well. The other financial metrics have been improving alongside that, with less than $1 million in both adjusted EBITDA and free cash use in Q2.

We also lowered our guidance for cash use in 2026 to less than $8 million from less than $10 million. Things are moving in the right direction. We expect to be adjusted EBITDA positive during 2027 between a revenue range of $52 million-$57 million annualized, or said differently, about $13 million-$14 million quarter in revenue, and cash flow positive shortly after that. We do have the capital that we need to execute on our organic strategy, and we are excited to be continuing down that path. So quick look at the type of products that we have. Agar plates, most people have probably seen those from their high school classes, and that is a base product for us, an entry product, often used in discovery work. We also support liquid microbial culture media and supplements. This is typically for cell growth, or also called upstream processes.

Then we have a bunch of other products in this molecular biology reagents category that are used for various cell manipulations and is also referred to as downstream processing. These pictures here give you a flavor for what our products look like. Everything from, well, plated media, as you see there, but also broths in bags, in bottles, bioprocessing bags, as well as tubes, all types of formats, and that is one of our specialties. There are a couple of different ways to break down the revenue, and this one focuses on the end markets of our products, so you can see where the demand is coming from. Roughly half the business is from biopharma companies. That includes the contract manufacturing base that supports those companies, and this includes all types of products that we have. That is our largest single end market.

30% of our business is to life science tools and diagnostics companies. I think this is probably one of the more underappreciated aspects of our business. We have a very robust client base in this area, and there are some very interesting developments happening in that market right now that have seen that actually growing ahead of the biopharma at the moment. Although we expect that to change over future quarters, that is a very positive thing. Then there are 15% in other markets. Here you get a flavor for what those customers are, some examples of those, and the number of customers. We report revenues publicly in the following two categories: Lab Essentials and Clinical Solutions.

The difference between those two is that Lab Essentials are a research-grade product, also called RUO, or research use only, and Clinical Solutions are called clinical grade, or GMP, good manufacturing practices. You can see in 2025, it was about 75% Lab Essentials and 20% Clinical Solutions. The thing to know here is that the majority of the revenue in the Lab Essentials in that research category is catalog products, and that is a very important foundation for us, and it is the reverse in the Clinical Solutions. It is mostly custom products when you have gotten to that phase. I will keep going here and talk a little bit about why we win. We get this question a lot, and what really makes us special is that we offer this broad range of catalog products with the ability to do customizations.

We do that in smaller batch sizes, which is especially useful for certain applications, and fast turnaround times, which helps our customers accelerate their time to market. We do this all while being able to have research products to clinical products all within the same location and manufacturing environment. One of the things that is important to know is the differences to us in terms of customers who buy catalog-only products and those that also buy GMP products. You can see that the customers that buy GMP products buy 44 times as much as those that buy catalog-only. Even when you are just buying custom research products, that is still 25 times than just buying catalog. So, as customers move along this maturity with us from catalog customers into GMP, you can see the value from a revenue perspective grows considerably.

Now, we are able to compete effectively against large companies in this space because we thrive in this smaller batch size world, which is, as I said, important for a number of different end customers, particularly those that are developing these emerging therapies and diagnostics where smaller batch sizes are what is needed. You do not need the large volumes of liquids for blockbuster types of drugs or diagnostics. So they are seeking those volumes, and we can provide them and do that profitably, whether they are big companies, it is not the type of business that they are typically interested in. Then there are the smaller companies that also can do smaller batches that we compete against, smaller than Teknova even, but they do not have the compliance and quality systems and the brand recognition that Teknova has when competing against those small companies.

Another dimension that is important is this turnaround time. A lot of companies come to us because their current supplier is not able to deliver in time to their specifications, and that is one of the hallmarks of Teknova. You can see getting that product back to them in weeks from the time of order, compared to what is typical months amongst competitors in this market. Just a quick note, we did launch a new custom configurator that we announced in the last couple of weeks based upon an AI foundation here.

This is a nice tool for customers to be able to move more quickly through the building a custom product phase, where we have kind of solved some bottlenecks and friction points with a very educated AI assistant based on Teknova's manufacturing experience over the last 30 years, and helps our customers get through that process faster and makes it easier for them to order custom from us. Very excited about what this can do. One thing I will just say about this business, having the catalog and custom business together is very important for our success and profitability. It allows us to kind of level load the demand through the factory.