- Sales of eyecare products increased with higher sales of
Avenova Spray related companion products
- Sales and marketing spend reduced by 17% through optimized
digital marketing programs
- Launched DERMAdoctor® Comfort + Joy Psoriasis Therapeutic
Moisturizing Cream
Conference call begins at 4:30 p.m. Eastern
time today
NovaBay® Pharmaceuticals, Inc. (NYSE American: NBY) reports
financial results for the three months ended March 31, 2023 and
provides a business update.
“Net product revenue from our Avenova-branded eyecare products
increased over the prior year driven by higher sales of Avenova
Spray sold through our physician-dispensed channel and by increased
interest in our Avenova companion products,” said Justin Hall,
NovaBay CEO. “On the expense side, we benefitted from our focus on
digital marketing optimization, which led to a 17% decline in sales
and marketing costs.
“Pursuant to our ongoing strategy of capitalizing on our brand
recognition and diversifying our revenue sources, so far this year
we’ve introduced three new branded products and launched our first
co-promoted product. Most recently, we introduced the first
DERMAdoctor product formulated to relieve the itching, irritation
and redness from psoriasis, a condition that afflicts about eight
million Americans. In our wound care vertical, we shipped a $1
million order for NeutroPhase® Skin and Wound Cleanser to our
partner China Pioneer and will record this sale in the second
quarter,” he added. “Proceeds from our recent financing that closed
in the second quarter of 2023 will further support our goal of
achieving profitability.”
First Quarter Financial Results
Net product revenue for the first quarter of 2023 was $3.1
million, compared with $3.3 million for the prior-year period, and
included $2.2 million of Avenova-branded eyecare product sales,
$0.8 million of DERMAdoctor skincare product sales and $0.1 million
of PhaseOne® wound care product sales.
Gross margin on net product revenue for the first quarter of
2023 improved to 62%, compared with 55% for the first quarter of
2022, with the increase primarily due to channel and product mix
that favored sales of higher-margin products and the reduction of
product returns when compared to the first quarter of 2022.
Total operating expenses for the first quarter of 2023 were $3.7
million, a 13% decrease from $4.2 million for the first quarter of
2022. Sales and marketing expenses for the first quarter of 2023
were $1.7 million, compared with $2.0 million in the prior year,
with the decrease reflecting lower Avenova digital advertising
costs. General and administrative expenses for the first quarter of
2023 were $2.0 million, compared with $2.2 million for the first
quarter of 2022, with the decrease due primarily to lower variable
compensation costs.
Net loss attributable to common stockholders for the first
quarter of 2023 was $1.7 million, or $0.85 per share, compared with
a net loss attributable to common stockholders for the first
quarter of 2022 of $0.1 million, or $0.08 per share, which included
a non-cash gain on changes in fair value of warrant liability of
$2.1 million and a non-cash gain on changes in fair value of
contingent liability of $0.2 million in the first quarter of 2022
with no similar non-cash gains in the first quarter of 2023.
NovaBay had cash and cash equivalents of $3.7 million as of
March 31, 2023, compared with $5.4 million as of December 31, 2022.
Subsequent to the close of the quarter, NovaBay completed a private
placement of convertible debentures and warrants for aggregate
gross proceeds of $3.0 million before deducting placement agent
fees and other offering expenses.
Conference Call
NovaBay management will host an investment community conference
call today beginning at 4:30 p.m. Eastern time (1:30 p.m. Pacific
time) to discuss the Company’s financial and operational results
and answer questions. Participants can pre-register for the
conference call here. Callers who pre-register will be given a
conference passcode and unique PIN to gain immediate access to the
call and bypass the live operator. Participants may pre-register at
any time, including up to and after the call start time.
Stockholders and other interested parties may also participate
in the conference call by dialing 866-777-2509 from within the U.S.
or 412-317-5413 from outside the U.S., and requesting the NovaBay
Pharmaceuticals call.
A live webcast of the call will be available here and will be
archived for 90 days. A replay of the call will be available
beginning two hours after the call ends through June 1, 2023 by
dialing 877-344-7529 from within the U.S., 855-669-9658 from Canada
or 412-317-0088 from outside the U.S. and Canada, and entering the
conference identification number 7090076.
About NovaBay Pharmaceuticals, Inc.:
NovaBay Pharmaceuticals, Inc. develops and sells scientifically
created and clinically proven eyecare, skincare and wound care
products. NovaBay’s leading product, Avenova® Antimicrobial Lid
& Lash Solution, is proven in laboratory testing to have broad
antimicrobial properties as it removes foreign material including
microorganisms and debris from the skin around the eye, including
the eyelid. Avenova Antimicrobial Lid & Lash Solution is
available direct to consumer primarily through online distribution
channels such as Amazon, and is also available by prescription and
dispensed by eyecare professionals for blepharitis and dry-eye
disease. DERMAdoctor® offers more than 30 OTC
dermatologist-developed skincare products through the DERMAdoctor
website, well-known traditional and digital beauty retailers, and
international distributors. NovaBay also manufactures and sells
effective, yet gentle and non-irritating wound care products. The
PhaseOne® brand is distributed through commercial partners in the
U.S. for professional use only, and the NeutroPhase® brand is
distributed in China by Pioneer Pharma (Hong Kong) Company Ltd.
Forward-Looking Statements
This release contains information about management's view of the
Company's future expectations, plans and prospects that constitute
forward-looking statements within the meaning of the “safe harbor”
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements can be identified by the fact that they
do not relate strictly to historic or current facts. Such
forward-looking statements are based upon management’s current
expectations, assumptions, estimates, projections and beliefs.
These statements include, but are not limited to, statements
regarding our business strategies, commercial progress, current and
potential future product offerings, the continuing integration of
DERMAdoctor, expanded access to our products, and any future
revenue, and the timing of such revenue, that may result from
selling these products, as well as generally the Company’s expected
future financial results. These statements involve risks,
uncertainties and other factors that may cause actual results or
achievements to be materially different and adverse from those
expressed in or implied by these forward-looking statements.
Factors that might cause or contribute to such differences include,
but are not limited to, risks and uncertainties relating to the
integration of DERMAdoctor’s business with the Company’s business
(and further related impairments to goodwill and intangible
assets), the size of the potential market for our products, the
Company’s products not being able to penetrate one or more targeted
markets and the Company’s ability to continue as a going concern
and revenues (or the execution on capital raise opportunities) not
being sufficient to meet the Company’s cash needs. Other risks
relating to NovaBay’s business, including risks that could cause
results to differ materially from those projected in the
forward-looking statements in this press release, are detailed in
NovaBay’s latest Form 10-K/Q filings with the Securities and
Exchange Commission, especially under the heading “Risk Factors.”
The forward-looking statements in this release speak only as of
this date, and NovaBay disclaims any intent or obligation to revise
or update publicly any forward-looking statement except as required
by law.
Socialize and Stay Informed on
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Website
Avenova Purchasing
Information For NovaBay Avenova purchasing information:
Please call 800-890-0329 or email sales@avenova.com Avenova.com
DERMAdoctor Purchasing
Information For DERMAdoctor purchasing information:
Please call 877-337-6237 or email service@dermadoctor.com
DERMAdoctor.com
NOVABAY PHARMACEUTICALS,
INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands, except par
value amounts)
March 31,
December 31,
2023
2022
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
3,746
$
5,362
Accounts receivable, net of allowance for
credit losses ($3 and $19 at March 31, 2023 and December 31, 2022,
respectively)
1,835
1,973
Inventory, net of allowance for excess and
obsolete inventory and lower of cost or estimated net realizable
value adjustments ($488 and $499 at March 31, 2023 and December 31,
2022, respectively)
3,797
3,437
Prepaid expenses and other current
assets
516
560
Total current assets
9,894
11,332
Operating lease right-of-use assets
1,744
1,831
Property and equipment, net
119
119
Goodwill
348
348
Other intangible assets, net
2,242
2,280
Other assets
478
489
TOTAL ASSETS
$
14,825
$
16,399
LIABILITIES AND STOCKHOLDERS’
EQUITY
Liabilities:
Current liabilities:
Accounts payable
$
1,148
$
1,080
Accrued liabilities
2,809
2,724
Operating lease liabilities
466
453
Total current liabilities
4,423
4,257
Operating lease
liabilities-non-current
1,512
1,588
Total liabilities
5,935
5,845
Commitments & contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value; 5,000
shares authorized;
Series B Preferred Stock; 12 shares issued
and outstanding at March 31, 2023 and December 31, 2022
570
570
Series C Preferred Stock; 2 shares issued
and outstanding at March 31, 2023 and December 31, 2022
2,403
2,403
Common stock, $0.01 par value; 150,000
shares authorized, 2,035 shares issued and outstanding at March 31,
2023 and December 31, 2022
652
652
Additional paid-in capital
165,156
165,081
Accumulated deficit
(159,891
)
(158,152
)
Total stockholders’ equity
8,890
10,554
TOTAL LIABILITIES AND STOCKHOLDERS’
EQUITY
$
14,825
$
16,399
NOVABAY PHARMACEUTICALS,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
(in thousands, except per
share data)
Three Months Ended March
31,
2023
2022
Sales:
Product revenue, net
$
3,117
$
3,267
Other revenue, net
7
6
Total sales, net
3,124
3,273
Product cost of goods sold
1,188
1,459
Gross profit
1,936
1,814
Operating expenses:
Research and development
26
28
Sales and marketing
1,653
1,985
General and administrative
1,991
2,183
Total operating expenses
3,670
4,196
Operating loss
(1,734
)
(2,382
)
Non-cash gain on changes in fair value of
warrant liability
—
2,056
Non-cash gain on changes in fair value of
contingent liability
—
219
Other expense, net
(5
)
(4
)
Net loss
$
(1,739
)
$
(111
)
Net loss per share attributable to common
stockholders (basic and diluted)
$
(0.85
)
$
(0.08
)
Weighted-average shares of common stock
outstanding used in computing net loss per share of common stock
(basic and diluted)
2,035
1,431
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230511005785/en/
NovaBay Contact Justin Hall
Chief Executive Officer and General Counsel 510-899-8800
jhall@novabay.com
Investor Contact LHA
Investor Relations Jody Cain 310-691-7100 jcain@lhai.com
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