- Product revenue increased by 43% year-over-year, fueled by a
growing product portfolio in the eyecare and skincare markets
- Continued year-over-year growth in online Avenova® Spray unit
sales
- Launched seven new OTC Avenova and DERMAdoctor® products since
the beginning of 2022
Conference call begins at 4:30 p.m. Eastern
time today
NovaBay® Pharmaceuticals, Inc. (NYSE American: NBY) reports
financial results for the three and six months ended June 30, 2022
and provides a business update. Financial results for the first six
months of 2022 include the operations of the DERMAdoctor business,
which was acquired on November 5, 2021.
“The strategy to expand and diversify our portfolio of
high-quality products is paying off with product revenue increasing
43% over the prior year. We are also reporting another quarter of
year-over-year growth in online Avenova Spray unit sales,
reflecting the success of our digital marketing initiatives,” said
Justin Hall, NovaBay CEO. “We achieved this growth by optimizing
our digital marketing programs, while holding our sales and
marketing spend steady, even with the additional expenses
associated with promoting DERMAdoctor products.
“We have executed on multiple initiatives to build upon our
established presence in the large and growing eyecare and skincare
markets, with more to come,” he added. “So far this year we have
launched seven new over-the-counter products under our Avenova and
DERMAdoctor brands, and engaged a leading marketing firm in China
to drive DERMAdoctor sales in that country. More recently, we
increased access to select DERMAdoctor products through the
addition of two popular U.S. online retailers and launched an
Avenova Spray consumer campaign for wearers of lash extensions,
leveraging our expertise in the beauty category to address an
entirely new customer demographic in a large and growing
market.
“Given the timing of our initiatives, and the anticipated
seasonal fall increase for skincare products and a significant
order from a major U.S. retailer for our top-selling DERMAdoctor
product, we continue to expect the majority of our growth in 2022
to come in the second half of the year,” concluded Mr. Hall.
Second Quarter Financial Results
Net product revenue for the second quarter of 2022 was $3.0
million, an increase of 43% from $2.1 million for the prior-year
period, and included $0.6 million of DERMAdoctor product sales,
$1.8 million of Avenova-branded product sales and $0.6 million of
NeutroPhase® and PhaseOne® branded wound care product sales.
Sales and marketing expenses were unchanged at $1.8 million for
the second quarters of 2022 and 2021. The second quarter of 2022
included $0.7 million of sales and marketing costs incurred for
DERMAdoctor, which were partially offset by lower Avenova digital
advertising costs. General and administrative (G&A) expenses
for the second quarter of 2022 were $1.9 million, compared with
$1.6 million for the second quarter of 2021, and included $0.5
million in DERMAdoctor G&A costs and $0.1 million from the
amortization of intangibles related to the DERMAdoctor acquisition,
partially offset by a decrease in professional services,
consultants and employee costs. Research and development (R&D)
expenses for the second quarter of 2022 were $40 thousand, compared
with $21 thousand for the prior-year period.
Gross margin on net product revenue for the second quarter of
2022 was 51%, compared with 71% for the second quarter of 2021,
with the decrease primarily due to sales of DERMAdoctor products
and higher sales of branded wound care products.
Operating expenses for the second quarter of 2022 were $3.7
million, compared with $3.4 million for the second quarter of 2021,
and included $1.1 million in DERMAdoctor expenses.
Net loss attributable to common stockholders for the second
quarter of 2022 was $2.2 million, or $0.04 per share, compared with
a net loss attributable to common stockholders for the second
quarter of 2021 of $1.9 million, or $0.04 per share.
Six Month Financial Results
Net product revenue for the six months ended June 30, 2022 was
$5.7 million, an increase of 44% from $3.9 million for the six
months ended June 30, 2021.
Gross margin on net product revenue for the first half of 2022
was 54%, compared with 73% for the first half of 2021.
For the six months ended June 30, 2022, sales and marketing
expenses decreased modestly and G&A expenses increased 49% due
to the DERMAdoctor acquisition, both compared with the six months
ended June 30, 2021. R&D expenses were $68 thousand for the
first six months of 2022 versus $26 thousand for the prior-year
period.
For the first six months of 2022, non-cash gain on the changes
of fair value of warrant liability was $2.1 million and non-cash
gain on the changes in fair value contingent liability was $219
thousand. There were no comparable items for the first six months
of 2021.
The net loss for the six months ended June 30, 2022 was $2.3
million, or $0.04 per share, compared with a net loss for the six
months ended June 30, 2021 of $3.4 million, or $0.08 per share.
NovaBay had cash and cash equivalents of $3.9 million as of June
30, 2022, compared with $7.5 million as of December 31, 2021.
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 to 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.
Shareholders 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 at
http://novabay.com/investors/events and will be archived for 90
days. A replay of the call will be available beginning two hours
after the call ends through August 17, 2022 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 entering the conference identification number
9678917.
About NovaBay Pharmaceuticals, Inc.:
NovaBay Pharmaceuticals, Inc. creates science-based,
problem-solving, accessible solutions for improved well-being
through its two brands, Avenova® and DERMAdoctor®. Avenova products
are scientifically created and clinically proven to help patients
and consumers with common eye irritations. DERMAdoctor products are
premium dermatologist-developed skincare solutions sold through
traditional domestic retailers, digital beauty channels and
international distributors.
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 and current
product offerings, 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 known and unknown 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 the
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, the size of the potential market for
our products, the Company’s products not being able to penetrate
one or more targeted markets, 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
NovaBay’s Progress Like us on Facebook Follow us on
Twitter Connect with NovaBay on LinkedIn Visit NovaBay’s
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)
June 30,
December 31,
2022
2021
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
3,931
$
7,504
Accounts receivable, net of allowance for
doubtful accounts ($0 at June 30, 2022 and December 31, 2021)
1,098
1,668
Inventory, net of allowance for excess and
obsolete inventory and lower of cost or estimated net realizable
value adjustments ($522 and $641 at June 30, 2022 and December 31,
2021, respectively)
3,801
3,220
Prepaid expenses and other current
assets
629
778
Total current assets
9,459
13,170
Operating lease right-of-use assets
2,217
411
Property and equipment, net
166
193
Goodwill
4,528
4,528
Other intangible assets, net
5,018
5,200
Other assets
156
476
TOTAL ASSETS
$
21,544
$
23,978
LIABILITIES AND STOCKHOLDERS'
EQUITY
Liabilities:
Current liabilities:
Accounts payable
$
930
$
1,045
Accrued liabilities
2,257
2,092
Line of credit
—
105
Operating lease liabilities
470
200
Total current liabilities
3,657
3,442
Operating lease liabilities
non-current
1,800
246
Warrant liability
—
9,558
Contingent earnout liability
342
561
Total liabilities
5,799
13,807
Commitments & contingencies (Note
12)
Stockholders' equity:
Preferred stock, $0.01 par value; 5,000
shares authorized; 12 and 14 issued and outstanding at June 30,
2022 and December 31, 2021, respectively
570
680
Common stock, $0.01 par value; 150,000 and
100,000 shares authorized, 53,513 and 47,766 shares issued and
outstanding at June 30, 2022 and December 31, 2021,
respectively
535
478
Additional paid-in capital
158,793
150,900
Accumulated deficit
(144,153
)
(141,887
)
Total stockholders' equity
15,745
10,171
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY
$
21,544
$
23,978
NOVABAY PHARMACEUTICALS,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)
(in thousands except per share
data)
Three Months Ended June
30,
Six Months Ended
June 30,
2022
2021
2022
2021
Sales:
Product revenue, net
$
3,043
$
2,126
$
5,666
$
3,927
Other revenue, net
2
7
8
13
Total sales, net
3,045
2,133
5,674
3,940
Product cost of goods sold
1,495
614
2,608
1,069
Gross profit
1,550
1,519
3,066
2,871
Operating expenses:
Research and development
40
21
68
26
Sales and marketing
1,752
1,788
3,439
3,468
General and administrative
1,910
1,569
4,093
2,756
Total operating expenses
3,702
3,378
7,600
6,250
Operating loss
(2,152
)
(1,859
)
(4,534
)
(3,379
)
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) income, net
(3
)
—
(7
)
2
Loss before provision for income taxes
(2,155
)
(1,859
)
(2,266
)
(3,377
)
Provision for income taxes
—
—
—
—
Net loss and comprehensive loss
$
(2,155
)
$
(1,859
)
$
(2,266
)
$
(3,377
)
Net loss per share (basic and diluted)
$
(0.04
)
$
(0.04
)
$
(0.04
)
(0.08
)
Weighted-average shares of common stock
used in computing net loss per share (basic and diluted)
52,735
42,561
51,419
42,174
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220811005647/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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