The condensed consolidated financial statements included herein have been prepared by BioLife Solutions, Inc. in accordance with generally accepted accounting principles in the United States (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), for Quarterly Reports on Form -Q and Article of Regulation S- and do include all of the information and footnote disclosures required by GAAP. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes thereto included in the Company’s Annual Report on Form -K for the fiscal year ended

 

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Astero Bio Corporation (“Astero,” and the Astero product line, “ThawStar” acquired on SAVSU Technologies, Inc. (“SAVSU” acquired on and Arctic Solutions, Inc. dba Custom Biogenic Systems (“CBS” acquired on All significant intercompany accounts and transactions have been eliminated in consolidation.

 

In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of only normal, recurring adjustments necessary for a fair presentation of the financial position, results of operations, and cash flows. The results of operations for the interim periods presented are necessarily indicative of results to be expected for the entire year.

 

 

Certain classifications on the Condensed Consolidated Statements of Cash Flows related to Non cash lease expense and Accrued expenses and other current liabilities for the months ended were reclassified to conform to current period presentation. These reclassifications have impact on previously reported total revenue, net income (loss), net assets, or total operating cash flows.

 

 

There have been significant changes to the accounting policies during the months ended as compared to the significant accounting policies described in our Annual Report on Form -K.

 

On the World Health Organization declared the COVID- outbreak a pandemic. The virus and actions taken to mitigate its spread have had and are expected to continue to have a broad adverse impact on the economies and financial markets of many countries, including the geographical areas in which the Company operates and conducts its business. In particular, the Seattle area, including the location of our corporate headquarters and our media production facility and warehouse, is at of the epicenters of the coronavirus outbreak in the U.S. We are currently following the recommendations of local health authorities to minimize exposure risk for our team members and visitors.  However, the scale and scope of this pandemic is unknown and the duration of the business disruption and related financial impact cannot be reasonably estimated at this time. While we have implemented specific business continuity plans to reduce the potential impact of COVID- and believe that we have sufficient biopreservation media inventory to meet previously forecasted demand for the next to months, there is guarantee that our continuity plan, once in place, will be successful or that our inventory will meet forecasted or actual demand.

 

We have already experienced certain disruptions to our business such as temporary closure of our offices and similar disruptions occur for our customers or suppliers that materially affect our ability to obtain supplies or other components for our products, produce our products or deliver inventory in a timely manner. This would result in lost product revenue, additional costs, or penalties, or damage our reputation. Similarly, COVID- could impact our customers and/or suppliers as a result of a health epidemic or other outbreak occurring in other locations which could reduce their demand for our products or their ability to deliver needed supplies for the production of our products. The extent to which COVID- or any other health epidemic impact our results will depend on future developments, which are highly uncertain and cannot be predicted, including new information which emerge concerning the severity of COVID- and the actions to contain COVID- or treat its impact, among others. Accordingly, COVID- could have a material adverse effect on our business, results of operations, financial condition and prospects.

 

There are many uncertainties regarding the current pandemic of the novel coronavirus (“COVID-), and the Company is closely monitoring the impact of COVID- on all aspects of its business, including how it will impact its customers, employees, suppliers, vendors, business partners and distribution channels. While COVID- did materially affect the Company’s financial results and business operations in the Company’s quarter ended the Company is unable to predict the impact that COVID- have on its financial position and operations moving forward due to numerous uncertainties. We estimate that we received approximately - million in incremental media revenue resulting from what we believe were safety stock purchases of media. These estimates change as new events occur and additional information is obtained, and actual results could differ materially from these estimates under different assumptions or conditions. The Company will continue to assess the evolving impact of COVID- and will make adjustments to its operations as necessary.  

 

In the FASB issued ASU - “Fair Value Measurement (Topic ): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement.” ASU - includes amendments that aim to improve the effectiveness of fair value measurement disclosures. The amendments in this guidance modify the disclosure requirements on fair value measurements based on the concepts in FASB Concepts Statement, “Conceptual Framework for Financial Reporting—Chapter Notes to Financial Statements,” including the consideration of costs and benefits. The amendments become effective for the Company in the year ending and early adoption is permitted. The Company adopted this guidance and there was material impact on its consolidated financial statements.

 

In the FASB issued ASU - “Income Taxes (Topic ) – Simplifying the Accounting for Income Taxes.” ASU - simplifies the accounting for income taxes by removing certain exceptions to the general principles in Topic including, but limited to, the exception to the incremental approach for intraperiod tax allocation when there is a loss from continuing operations and income or a gain from other items, the exceptions related to the recognition of a deferred tax liability related to an equity method investment and the exception to methodology for calculating income taxes in an interim period when a year-to-date loss exceeds the anticipated loss for the year. ASU - becomes effective for the Company in the year ended including interim periods. The Company is considering early adoption in Due to the full valuation allowance on the Company’s net deferred tax assets, the Company is currently expecting material impact from the adoption of ASU - on its consolidated financial statements.

 

In the FASB issued ASU - “Financial Instruments – Credit Losses (Topic ): Measurement of Credit Losses on Financial Instruments.” ASU - requires companies to measure credit losses utilizing a methodology that reflects expected credit losses and requires a consideration of a broader range of reasonable and supportable information to inform credit loss estimates. For Smaller Reporting Companies as defined by the SEC, ASU - is effective for fiscal years beginning after including interim periods within those fiscal years. The Company is evaluating the impact of the guidance on its financial statements. 

 

In the FASB issued ASU - “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic -): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract”, which clarifies the accounting for implementation costs in cloud computing arrangements. ASU - is effective for fiscal years beginning after including interim periods within those fiscal years. The Company will adopt the standard prospectively on The Company adopted this guidance and there was material impact on its consolidated financial statements.