Guardion Health Sciences, Inc. (Nasdaq: GHSI) (“Guardion” or the
“Company”), a specialty health sciences company that develops
clinically supported nutrition, medical foods and medical devices,
with a focus in the ocular health marketplace, announced financial
results for the three months and nine months ended September 30,
2020, and is also providing a corporate update.
Financial and corporate highlights for the three
months and nine months ended September 30, 2020 include the
following:
- Total revenue was approximately
$253,000 for the three months ended September 30, 2020, as compared
to approximately $161,000 for the three months ended September 30,
2019, an increase of 57%.
- Medical foods sales are up 26% for
the three months ended September 30, 2020, as compared to the three
months ended September 30, 2019.
- Medical devices sales are up 147%
for the three months ended September 30, 2020, as compared to the
three months ended September 30, 2019.
- Net loss for the three months ended
September 30, 2020 was approximately ($2,143,000) or ($0.02) per
share, as compared to a net loss of approximately ($2,385,000) or
($0.07) per share for the three months ended September 30,
2019.
- Cash balance at September 30, 2020
was approximately $9,800,000.
- Ho Wah Genting Berhad (“HWGB”), the
Company’s distributor in Malaysia, has received product
registration approval from the Malaysian National Pharmaceutical
Regulatory Agency (“NPRA”) for Astramern Nutra V, an immune support
dietary supplement designed and produced by Guardion; approval for
Astramern Nutra H, an herb formulation that HWGB intends to market
together with Astramern Nutra V, continues to be pending with the
Malaysian NPRA.
- Publication of promising new data
in the journal Nutrients (published October 26, 2020),
which compared the efficacy of the Company’s Lumega-Z® to the
current standard of care, the AREDS-2 soft gel supplement (marketed
under the PreserVision® brand by Bausch + Lomb) in patients with
vision problems associated with eye disease. Lumega-Z® demonstrated
statistically significant vision improvements in both eyes at six
months (p < 0.001), and a positive linear trend with treatment
time (p < 0.001), with benefits visible after just three months;
whereas the AREDS-2 supplement gel cap formulation provided no
significant change (p > 0.05).
- Initiation of
investigator-initiated clinical trials designed to evaluate the
impact of Lumega-Z® on the restoration of the macular pigment and
its relationship to the stabilization or recovery of vision in
patients with eye disease. It is believed that depletion of the
macular pigment at the back of the eye is a risk factor for vision
problems related to age-related macular degeneration (“AMD”),
glaucoma and other serious eye diseases.
- Guardion retained the investment
banking firm Corporate Finance Associates (“CFA”) to act as its
exclusive financial advisor to assist management and the Board of
Directors in the identification and evaluation of strategic
transactions to enhance shareholder value.
- At the Company’s Annual Meeting of
Shareholders held on October 29, 2020, shareholders approved all
four matters presented for approval.
- Trademark for “NutriGuard” issued
on October 27, 2020 by the U.S. Patent and Trademark Office under
Class 5 – nutritional dietary supplements.
David Evans, Ph.D., Guardion’s interim President
and Chief Executive Officer, and Chief Science Officer, commented,
“As we continue to develop our investment into clinical research to
build strong differentiated brand claims, we are entering the
commercial phase of our business development process. Despite a
challenging environment with the COVID-19 pandemic, which has
slowed our progress both in terms of connecting directly with
doctors and consumers, as well as conducting day-to-day business,
sales continue to be up year-over-year. Over the course of this
pandemic, it has become increasingly clear that there are multiple
business opportunities for Guardion to explore, including enhancing
our digital distribution channels and e-commerce platform and
expanding our international distribution opportunities. In
addition, we are working closely with CFA to identify and evaluate
strategic transactions and opportunities to enhance shareholder
value.”
Dr. Evans concluded, “We continue to receive
third party validation of our products, including recently
published studies, in the journal Nutrients, showing superior
efficacy of our proprietary formulation, Lumega-Z®, in terms of
both absorption level and improvement in visual function, versus
PreserVision®, the industry leading AREDS-2 gel cap product
formulation. These results clearly support our brand messaging and
offer an evidenced-based foundation to support our evolving product
development strategies. We will continue our commitment to
scientific and clinical validation of our proprietary products and
to report on our results to our shareholders as this information
occurs.”
Results of Annual Meeting of
Shareholders and Nasdaq Delisting
Issue
On October 29, 2020, the Company held its annual
meeting of shareholders (the “Meeting”). At the Meeting, the
Company’s shareholders approved all four proposals, including
extending the discretionary authority previously granted to the
Board of Directors to effect a “reverse stock split,” at a specific
ratio within a range of no split and one-for-thirty (1-for-30),
with the exact ratio to be determined by the Board of Directors in
its sole discretion on or before October 29, 2021.
Since the Company does not intend to execute a
reverse stock split prior to November 30, 2020, Guardion expects to
receive a notice of delisting from The Nasdaq Capital Market
(“Nasdaq”) shortly after November 30, 2020 because the trading
price of the Company’s common stock does not meet the $1.00 per
share minimum bid price requirement.
The Company intends to appeal any notice of
delisting that Nasdaq issues after November 30, 2020 to request a
further extension of time (not to exceed 180 days from the date of
the notice of delisting) to regain compliance with the $1.00
minimum bid price requirement. Such temporary relief would allow
the Company additional time to execute on its business initiatives
to generate greater shareholder value, which the Company hopes
would then be reflected by an increase in the price of the
Company’s common stock. During the appeal process, the Company’s
common stock will continue to be listed on Nasdaq.
A permanent delisting from Nasdaq could
adversely impact the liquidity of the Company’s common stock and
limit the ability of the Company to raise additional capital in the
future.
Financial Results
Three Months Ended September 30,
2020
Total revenue for the three months ended
September 30, 2020 increased by approximately 57% to approximately
$253,000, as compared total revenue for the three months ended
September 30, 2019 of approximately $161,000, primarily due to
increased sales of medical foods and nutraceuticals and medical
devices in the current period.
Operating expenses for the three months ended
September 30, 2020 decreased by approximately 8% to approximately
$2,291,000 as compared to operating expenses for the three months
ended September 30, 2019 of approximately $2,503,000, primarily due
to a decrease in selling and marketing expenses in the current
period.
Operating loss for the three months ended
September 30, 2020 decreased by approximately $260,000 to
approximately ($2,152,000), as compared to the operating loss for
the three months ended September 30, 2019 of approximately
($2,412,000). Net loss for the three months ended September 30,
2020 was approximately ($2,143,000), or ($0.02) per share, as
compared to a net loss of approximately ($2,385,000), or ($0.07)
per share, for the three months ended September 30, 2019.
Nine Months Ended September 30, 2020
Total revenue for the nine months ended
September 30, 2020 increased by approximately 154% to approximately
$1,690,000, as compared to total revenue for the nine months ended
September 30, 2019 of approximately $665,000. This increase was
primarily due to a large initial test order of a nutraceutical
product placed by the Company’s Malaysian distributor of $890,000
that was recorded during the three months ended June 30, 2020 and
increased sales of medical food product lines, partially offset by
a decrease in medical device sales which were affected by the
impact of COVID-19 closures during the nine months ended September
30, 2020.
Operating expenses for the nine months ended
September 30, 2020 decreased by approximately 12% to approximately
$6,018,000, as compared to operating expenses for the nine months
ended September 30, 2019 of approximately $6,813,000, primarily due
to a reduction of approximately $965,000 in stock-based
compensation cost related to a reversal of stock-based compensation
as a result of the resignation of the Company’s former President
and Chief Executive Officer in June 2020.
Operating loss for the nine months ended
September 30, 2020 decreased by approximately $1,214,000 to
approximately ($5,196,000), as compared to the operating loss for
the nine months ended September 30, 2019 of approximately
($6,410,000). Net loss for the nine months ended September 30, 2020
was approximately ($5,198,000), or ($0.06) per share, as compared
to a net loss of approximately ($6,823,000), or ($0.26) per share,
for the nine months ended September 30, 2019.
About Guardion
Health Sciences
Guardion is a specialty health sciences company
that develops clinically supported nutrition, medical foods and
medical devices, with a focus in the ocular health marketplace.
Located in San Diego, California, the Company combines targeted
nutrition with innovative, evidence-based diagnostic technology.
Guardion boasts impressive Scientific and Medical Advisory Boards.
Information and risk factors with respect to Guardion and its
business, including its ability to successfully develop and
commercialize its proprietary products and technologies, may be
obtained in the Company’s filings with the U. S. Securities and
Exchange Commission (the “SEC”) at www.sec.gov.
Forward-Looking Statement
Disclaimer
With the exception of the historical information
contained in this news release, the matters described herein may
contain forward-looking statements within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended. Statements
preceded by, followed by or that otherwise include the words
“believes,” “expects,” “anticipates,” “intends,” “projects,”
“estimates,” “plans” and similar expressions or future or
conditional verbs such as “will,” “should,” “would,” “may” and
“could” are generally forward- looking in nature and not historical
facts, although not all forward-looking statements include the
foregoing. These statements involve unknown risks and uncertainties
that may individually or materially impact the matters discussed
herein for a variety of reasons that are outside the control of the
Company, including, but not limited to, the Company’s ability to
raise sufficient financing to implement its business plan, the
impact of the COVID-19 pandemic on the Company’s business,
operations and the economy in general, and the Company’s ability to
successfully develop and commercialize its proprietary products and
technologies. Readers are cautioned not to place undue reliance on
these forward- looking statements, as actual results could differ
materially from those described in the forward-looking statements
contained herein. Readers are urged to read the risk factors set
forth in the Company’s filings with the SEC, which are available at
the SEC’s website (www.sec.gov). The Company disclaims any
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Investor Relations Contact:CORE IRScott
Arnold516-222-2560scotta@coreir.com
Media Relations Contact:Jules AbrahamDirector
of Public RelationsCORE IR917-885-7378julesa@coreir.com
Guardion Health Sciences, Inc. |
Condensed Consolidated Balance Sheets |
|
|
September 30, 2020 |
|
|
December 31, 2019 |
|
|
(Unaudited) |
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets |
|
|
|
|
|
|
|
Cash |
$ |
9,795,441 |
|
|
$ |
11,115,502 |
|
Accounts receivable |
|
22,849 |
|
|
|
78,337 |
|
Inventories, net |
|
1,284,173 |
|
|
|
310,941 |
|
Prepaid expenses |
|
231,621 |
|
|
|
362,938 |
|
|
|
|
|
|
|
|
|
Total current
assets |
|
11,334,084 |
|
|
|
11,867,718 |
|
|
|
|
|
|
|
|
|
Deposits |
|
11,751 |
|
|
|
11,751 |
|
Property and equipment,
net |
|
305,600 |
|
|
|
374,638 |
|
Right-of-use asset, net |
|
457,677 |
|
|
|
572,714 |
|
Intangible assets |
|
50,000 |
|
|
|
50,000 |
|
|
|
|
|
|
|
|
|
Total
assets |
$ |
12,159,112 |
|
|
$ |
12,876,821 |
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
|
Accounts payable |
$ |
576,890 |
|
|
$ |
70,291 |
|
Accrued expenses |
|
182,597 |
|
|
|
175,052 |
|
Due to former officer |
|
230,208 |
|
|
|
- |
|
Derivative warrant liability |
|
7,519 |
|
|
|
13,323 |
|
Lease liability – current |
|
159,962 |
|
|
|
151,568 |
|
Total current
liabilities |
|
1,157,176 |
|
|
|
410,234 |
|
|
|
|
|
|
|
|
|
Lease liability –
long-term |
|
313,909 |
|
|
|
434,747 |
|
|
|
|
|
|
|
|
|
Total
liabilities |
|
1,471,085 |
|
|
|
844,981 |
|
|
|
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’
Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock, $0.001 par
value; 10,000,000 shares authorized, no shares issued and
outstanding |
|
- |
|
|
|
- |
|
Common stock, $0.001 par
value; 250,000,000 shares authorized; 88,327,312 and 74,982,562
shares issued and outstanding at September 30, 2020 and December
31, 2019, respectively |
|
88,327 |
|
|
|
74,983 |
|
Additional paid-in
capital |
|
61,308,938 |
|
|
|
57,468,528 |
|
Accumulated deficit |
|
(50,709,238 |
) |
|
|
(45,511,671 |
) |
|
|
|
|
|
|
|
|
Total stockholders’
equity |
|
10,688,027 |
|
|
|
12,031,840 |
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders’ equity |
$ |
12,159,112 |
|
|
$ |
12,876,821 |
|
Guardion Health Sciences, Inc. |
Condensed Consolidated Statements of
Operations |
|
|
Three Months EndedSeptember
30, |
|
|
Nine Months EndedSeptember
30, |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medical foods and nutraceuticals |
$ |
142,556 |
|
|
$ |
112,957 |
|
|
$ |
1,446,584 |
|
|
$ |
317,338 |
|
Medical devices |
|
110,632 |
|
|
|
44,705 |
|
|
|
237,136 |
|
|
|
337,531 |
|
Other |
|
- |
|
|
|
3,500 |
|
|
|
6,100 |
|
|
|
9,800 |
|
Total
revenue |
|
253,188 |
|
|
|
161,162 |
|
|
|
1,689,820 |
|
|
|
664,669 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Medical foods and nutraceuticals |
|
68,956 |
|
|
|
41,655 |
|
|
|
764,245 |
|
|
|
120,608 |
|
Medical devices |
|
45,157 |
|
|
|
27,922 |
|
|
|
101,077 |
|
|
|
136,958 |
|
Other |
|
- |
|
|
|
1,422 |
|
|
|
2,478 |
|
|
|
3,981 |
|
Total cost of goods
sold |
|
114,113 |
|
|
|
70,999 |
|
|
|
867,800 |
|
|
|
261,547 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
139,075 |
|
|
|
90,163 |
|
|
|
822,020 |
|
|
|
403,122 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
34,034 |
|
|
|
31,897 |
|
|
|
109,803 |
|
|
|
138,613 |
|
Sales and marketing |
|
167,213 |
|
|
|
448,387 |
|
|
|
1,175,126 |
|
|
|
1,246,846 |
|
General and administrative |
|
2,070,998 |
|
|
|
2,022,367 |
|
|
|
5,299,696 |
|
|
|
5,427,573 |
|
Costs related to resignation of former officer (including the
reversal of previously recognized stock compensation expense of
$965,295 during the nine months ended September 30, 2020) |
|
- |
|
|
|
- |
|
|
|
(615,936 |
) |
|
|
- |
|
Loss on sale of equipment |
|
18,500 |
|
|
|
- |
|
|
|
18,500 |
|
|
|
- |
|
Impairment loss on equipment |
|
- |
|
|
|
- |
|
|
|
30,948 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses |
|
2,290,745 |
|
|
|
2,502,651 |
|
|
|
6,018,137 |
|
|
|
6,813,032 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations |
|
(2,151,670 |
) |
|
|
(2,412,488 |
) |
|
|
(5,196,117 |
) |
|
|
(6,409,910 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other (income)
expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
3,716 |
|
|
|
4,205 |
|
|
|
7,254 |
|
|
|
255,842 |
|
Finance cost upon issuance of warrants |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
415,955 |
|
Change in fair value of derivative warrants |
|
(11,892 |
) |
|
|
(31,322 |
) |
|
|
(5,804 |
) |
|
|
(259,154 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other (income)
expense |
|
8,176 |
|
|
|
(27,117) |
|
|
|
1,450 |
|
|
|
412,643 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
$ |
(2,143,494 |
) |
|
$ |
(2,385,371 |
) |
|
$ |
(5,197,567 |
) |
|
$ |
(6,822,553 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share –
basic and diluted |
$ |
(0.02 |
) |
|
$ |
(0.07 |
) |
|
$ |
(0.06 |
) |
|
$ |
(0.26 |
) |
Weighted average common shares
outstanding – basic and diluted |
|
88,320,523 |
|
|
|
36,035,309 |
|
|
|
84,530,367 |
|
|
|
26,483,713 |
|
Guardion Health Sciences, Inc. |
Operations by Segment (Unaudited) |
|
|
For the Three Months Ended September 30, 2020 |
|
|
Corporate |
|
|
Medical Foods and Nutraceuticals |
|
|
Medical Devices |
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
- |
|
|
$ |
142,556 |
|
|
$ |
110,632 |
|
$ |
253,188 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold |
|
- |
|
|
|
68,956 |
|
|
|
45,157 |
|
|
114,113 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
- |
|
|
|
73,600 |
|
|
|
65,475 |
|
|
139,075 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses |
|
1,202,402 |
|
|
|
1,081,897 |
|
|
|
6,446 |
|
|
2,290,745 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) income from
operations |
$ |
(1,202,402 |
) |
|
$ |
(1,008,296 |
) |
|
$ |
59,028 |
|
$ |
(2,151,670 |
) |
|
For the Nine Months Ended September 30, 2020 |
|
|
Corporate |
|
|
Medical Foods and Nutraceuticals |
|
|
Medical Devices |
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
6,100 |
|
|
$ |
1,446,584 |
|
|
$ |
237,136 |
|
|
$ |
1,689,820 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold |
|
2,477 |
|
|
|
764,246 |
|
|
|
101,077 |
|
|
|
867,800 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
3,623 |
|
|
|
682,338 |
|
|
|
136,059 |
|
|
|
822,020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses |
|
2,655,107 |
|
|
|
3,146,514 |
|
|
|
216,516 |
|
|
|
6,018,137 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations |
$ |
(2,651,484 |
) |
|
$ |
(2,464,176 |
) |
|
$ |
(80,457 |
) |
|
$ |
(5,196,117 |
) |
Guardion Health Sciences (NASDAQ:GHSI)
Historical Stock Chart
From Mar 2024 to Apr 2024
Guardion Health Sciences (NASDAQ:GHSI)
Historical Stock Chart
From Apr 2023 to Apr 2024