Total net sales of $17.3 million for the three
months ended March 31, 2022, up 18% from the prior year, with $14.9
million from Tru Niagen® and gross margin of 61.0% for the
quarter.
ChromaDex Corp. (NASDAQ:CDXC) today announced financial results
for the first quarter of 2022.
First Quarter 2022 and Recent Highlights
- Total net sales were $17.3 million, up 18% from the prior year
quarter.
- Tru Niagen® net sales were $14.9 million, a 20% increase from
the prior year quarter.
- In April 2022, the ChromaDex External Research Program (CERP)
achieved its 250th material transfer agreement since 2013,
resulting in over 100 peer-reviewed preclinical and clinical
studies, many including the study of Niagen® and its impact on
healthy aging.
- Clinical study published in Cell Metabolism revealed NR as a
potential neuroprotective therapy for Parkinson’s Disease (PD)
patients, warranting further investigation in additional trials.
Two additional studies are underway, including a 400 patient study
at 1,000 milligrams per day, and a 20 patient study at 3,000
milligrams per day.
- Launched new consumer product, Tru Niagen® Immune, a
first-of-its kind combination of immune-boosting nutrition with
ChromaDex’s proprietary NAD+ boosting ingredient Niagen®, beginning
April 2022.
- Granted additional U.S. continuation patent to protect the
novel manufacturing process of NR and its various salt forms, which
now cover NR Chloride, NR Malate, and NR Tartrate salts, through
2037.
“We delivered solid financial results in the first quarter,
while strengthening our patent portfolio, and announcing dramatic
new scientific research on Niagen(R),” said CEO, Rob Fried.
“Following the quarter, we launched Tru Niagen(R) Immune and ramped
up our new TV campaign to encouraging early results.”
Results of operations for the three months ended March 31,
2022 compared to the prior year quarter
For the three months ended March 31, 2022 (“Q1 2022”), ChromaDex
reported net sales of $17.3 million, up $2.6 million or 18%
compared to the first quarter of 2021 (“Q1 2021”). The increase in
Q1 2022 revenues was largely driven by growth in sales of Tru
Niagen® (primarily e-commerce) paired with slight growth in
ingredient sales.
Gross margin percentage declined to 61.0% in Q1 2022 compared to
62.9% in Q1 2021 primarily due to business mix and increases in
supply chain headcount to scale the business.
Operating expenses increased by $1.7 million to $18.3 million in
Q1 2022, compared to $16.6 million in Q1 2021. The increase in
operating expenses was driven by $2.0 million of higher selling and
marketing expenses partially offset by a $0.6 million decrease in
general and administrative expense. The increase in selling and
marketing expenses are largely due to brand building activities,
including new Tru Niagen® television campaign.
The net loss for Q1 2022 was $7.7 million or $(0.11) per share
compared to a net loss of $7.4 million or $(0.12) per share for Q1
2021. Adjusted EBITDA including legal expense, a non-GAAP measure,
delivered a loss of $4.5 million for Q1 2022, a $1.2 million
improvement from Q1 2021. Adjusted EBITDA excluding legal expense,
a non-GAAP measure, was a loss of $2.1 million for Q1 2022. See
“Reconciliation of Non-GAAP Financial Measures” for a
reconciliation of non-GAAP Adjusted EBITDA excluding legal expense
to net loss, the most directly comparable GAAP measure.
For Q1 2022, the net cash outflow from operating activities was
$7.2 million, compared to $5.4 million in Q1 2021 largely due to
changes in working capital.
2022 Full Year Outlook
Looking forward, for the full year, the Company expects 15-20%
revenue growth, driven by its global e-commerce business, as well
as growth with existing and new strategic partners. The outlook
does not include revenue upside from potential new partnerships in
the pipeline. The outlook contemplates continued COVID-19 headwinds
for international partners. The Company expects slightly better
than 60% gross margin and a reduction in general and administrative
expense of $5.0 to $6.0 million, as reported, for full year 2022,
driven by lower legal expense. The Company expects to increase
investments and resources to drive brand awareness and accelerate
its research and development pipeline to capitalize on growth in
the nicotinamide adenine dinucleotide (NAD+) market globally.
Accordingly, the Company expects an increase in research and
development expense of approximately $2.0 million. Selling and
marketing expense is expected to be up in absolute dollars, but
down slightly as a percentage of net sales, year-over-year.
Investor Conference Call
A live webcast will be held Thursday, May 12, 2022 at 4:30 p.m.
Eastern time (1:30 p.m. Pacific time) to discuss ChromaDex’s
first-quarter financial results and provide a general business
update.
To listen to the webcast, or to view the earnings press release
and its accompanying financial exhibits, please visit the Investors
Relations section of ChromaDex’s website at http://chromadex.com.
The toll-free dial-in information for this call is 1-888-330-2446
with Conference ID: 4126168.
The webcast will be recorded, and will be available for replay
via the website from 7:30 p.m. Eastern time on May 12, 2022 to
11:59 p.m. Eastern time on May 19, 2022. The replay of the call can
also be accessed by dialing 800-770-2030, using the Replay ID:
4126168.
Important Note on Forward Looking Statements:
This release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, and Section
21E of the Securities Exchange Act of 1934. Statements that are not
a description of historical facts constitute forward-looking
statements and may often, but not always, be identified by the use
of such words as “expects,” “anticipates,” “intends” “estimates,”
“plans,” “potential,” “possible,” “probable,” “believes” “seeks,”
“may,” “will,” “should,” “could,” “predicts,” “projects,”
“continue,” “would” or the negative of such terms or other similar
expressions. Forward-looking statements include statements
regarding our intentions, beliefs, projections, outlook, analyses
or current expectations concerning, among other things: the
quotation from ChromaDex’s Chief Executive Officer, and statements
related to the Company’s 2022 financial outlook including but not
limited to revenue growth, gross margin, expenses, and investment
plans. Other risks that contribute to the uncertain nature of the
forward-looking statements include: the impact of the COVID-19
pandemic on our business and the global economy; our history of
operating losses and need to obtain additional financing; the
growth and profitability of our product sales; our ability to
maintain sales, marketing and distribution capabilities; changing
consumer perceptions of our products; our reliance on a single or
limited number of third-party suppliers; and the risks and
uncertainties associated with our business and financial condition
in general, described in our filings with the Securities and
Exchange Commission (SEC), including, without limitation, our most
recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q
as filed with the SEC. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as
of the date hereof, and actual results may differ materially from
those suggested by these forward-looking statements. All
forward-looking statements are qualified in their entirety by this
cautionary statement and ChromaDex undertakes no obligation to
revise or update this release to reflect events or circumstances
after the date hereof.
About ChromaDex:
ChromaDex Corporation is a global bioscience company dedicated
to healthy aging. The ChromaDex team, which includes world-renowned
scientists, is pioneering research on nicotinamide adenine
dinucleotide (NAD+), an essential coenzyme that is a key regulator
of cellular metabolism and is found in every cell of the human
body. NAD+ levels in humans have been shown to decline with age,
among other factors, and may be increased through supplementation
with NAD+ precursors. ChromaDex is the innovator behind NAD+
precursor nicotinamide riboside (NR), commercialized as the
flagship ingredient Niagen®. Nicotinamide riboside and other NAD+
precursors are protected by ChromaDex’s patent portfolio.
The Company delivers Niagen® as the sole active ingredient in
its consumer product Tru Niagen® available at www.truniagen.com and
through partnerships with global retailers and distributors. The
Company also develops and commercializes proprietary-based
ingredient technologies and supplies these ingredients as raw
materials to the manufacturers of consumer products. The Company
further offers natural product fine chemicals, known as
phytochemicals, and related research and development services.
Follow us on Twitter @ChromaDex and Instagram @TruNiagen and
subscribe to our latest news via our website accessible at
www.chromadex.com to which ChromaDex regularly posts copies of its
press releases as well as additional updates and financial
information about the Company.
ChromaDex Corporation and
Subsidiaries
Unaudited Condensed
Consolidated Statements of Operations
(In thousands, except per share
data)
Three Months Ended March
31,
2022
2021
Sales, net
$
17,259
$
14,683
Cost of sales
6,727
5,449
Gross profit
10,532
9,234
Operating expenses:
Sales and marketing
8,237
6,258
Research and development
1,078
787
General and administrative
8,949
9,551
Total operating expenses
18,264
16,596
Operating loss
(7,732
)
(7,362
)
Interest expense, net
(8
)
(19
)
Net loss
$
(7,740
)
$
(7,381
)
Basic and diluted loss per share
attributable to common stockholders:
$
(0.11
)
$
(0.12
)
Basic and diluted weighted average common
shares outstanding
68,314
64,164
ChromaDex Corporation and
Subsidiaries
Unaudited Condensed
Consolidated Balance Sheets
(In thousands except par values,
unless otherwise indicated)
Mar 31, 2022
Dec 31, 2021
Assets
Current assets:
Cash, including restricted cash of $0.2
million as of both dates
$
20,993
$
28,219
Trade receivables, net of allowances of
$54 and $65, respectively; Including receivables from Related Party
of: $2.3 million and $2.1 million, respectively.
6,310
5,226
Inventories
15,307
13,601
Prepaid expenses and other assets
1,913
1,859
Total current assets
44,523
48,905
Leasehold improvements and equipment,
net
2,940
3,003
Intangible assets, net
808
857
Right-of-use assets
4,053
4,352
Other long-term assets
606
723
Total assets
$
52,930
$
57,840
Liabilities and Stockholders'
Equity
Current liabilities:
Accounts payable
$
9,780
$
10,423
Accrued expenses
8,126
6,481
Current maturities of operating lease
obligations
630
528
Current maturities of finance lease
obligations
17
20
Customer deposits
141
161
Total current liabilities
18,694
17,613
Deferred revenue
4,346
4,346
Operating lease obligations, less current
maturities
4,013
4,154
Total liabilities
27,053
26,113
Commitments and Contingencies
Equity
ChromaDex Corporation and subsidiaries
stockholders' equity:
Common stock, $0.001 par value; authorized
150,000 shares; 68,149 shares and 68,126 shares issued and
outstanding at March 31, 2022 and December 31, 2021,
respectively.
68
68
Additional paid-in capital
202,502
200,614
Accumulated deficit
(176,693
)
(168,953
)
Cumulative translation adjustments
—
(2
)
Total stockholders’ equity
25,877
31,727
Total liabilities and stockholders’
equity
$
52,930
$
57,840
ChromaDex Corporation and
Subsidiaries
Unaudited Reconciliation of
Non-GAAP Financial Measures
(In thousands)
Reconciliation of Net Loss to Adjusted
EBITDA including legal expense and Adjusted EBITDA excluding legal
expense
Q1 2022
Q4 2021
Q3 2021
Q2 2021
Q1 2021
Net loss, as reported
$
(7,740
)
$
(5,325
)
$
(8,856
)
$
(5,566
)
$
(7,381
)
Adjustments:
Interest expense, net
8
9
15
12
19
Depreciation
201
211
232
226
221
Amortization of intangibles
49
51
53
61
60
Amortization of right of use assets
299
126
131
128
126
Share-based compensation
1,888
1,473
1,822
1,616
1,284
Severance and restructuring
821
6
342
13
(10
)
Adjusted EBITDA including legal
expense
$
(4,474
)
$
(3,449
)
$
(6,261
)
$
(3,510
)
$
(5,681
)
Legal expense
2,341
1,626
5,640
4,150
5,010
Adjusted EBITDA excluding legal
expense
$
(2,133
)
$
(1,823
)
$
(621
)
$
640
$
(671
)
Non-GAAP Financial Information:
To supplement ChromaDex’s unaudited financial data presented in
accordance with generally accepted accounting principles (GAAP),
the Company has presented Adjusted EBITDA including legal expense
and Adjusted EBITDA excluding legal expense, both non-GAAP
financial measures. ChromaDex believes the presentation of these
non-GAAP financial measures provides important supplemental
information to management and investors and enhances the overall
understanding of the Company’s historical and current financial
operating performance. The Company believes disclosure of non-GAAP
financial measures has substance because the excluded expenses are
infrequent in nature, are variable in nature or do not represent
current cash expenditures. Further, these non-GAAP financial
measures are among the indicators the Company uses as a basis for
evaluating the Company’s financial performance as well as for
planning and forecasting purposes. Accordingly, disclosure of these
non-GAAP financial measures provides investors with the same
information that management uses to understand the Company’s
economic performance year-over-year.
Adjusted EBITDA including legal expense and Adjusted EBITDA
excluding legal expense are defined as net income before (a)
interest, (b) depreciation, (c) amortization, (d) non-cash
share-based compensation costs, (e) severance and restructuring
expense and (f) legal expense. While ChromaDex believes that these
non-GAAP financial measures provide useful supplemental information
to investors, there are limitations associated with the use of
these measures. These measures are not prepared in accordance with
GAAP and may not be directly comparable to similarly titled
measures of other companies due to potential differences in the
method of calculation. Management compensates for these limitations
by relying primarily on the Company’s GAAP results and by using
Adjusted EBITDA including legal expense and Adjusted EBITDA
excluding expense only supplementally and by reviewing the
reconciliation of the non-GAAP financial measure to its most
comparable GAAP financial measure.
Non-GAAP financial measures are not in accordance with, or an
alternative for, generally accepted accounting principles in the
United States. The Company’s non-GAAP financial measures are not
meant to be considered in isolation or as a substitute for
comparable GAAP financial measures and should be read only in
conjunction with the company’s consolidated financial statements
prepared in accordance with GAAP.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220512006015/en/
Investor Relations Brianna Gerber Vice President of
Finance and Investor Relations 949-419-0288 ext. 127
briannag@chromadex.com
Media Relations Kendall Knysch Director of Media
Relations 310-388-6706 ext. 689 kendall.knysch@chromadex.com
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