Guardion Health Sciences, Inc. (Nasdaq: GHSI) (“Guardion” or the
“Company”), a clinical nutrition and diagnostics company that
develops clinically supported nutrition, medical foods, supplements
and medical devices, announced its financial results for the three
months and nine months ended September 30, 2021. The Company also
provided a corporate update to shareholders.
Financial highlights for the three months ended
September 30, 2021 include the following:
- Total revenue of
$3,148,612 for the three months ended September 30, 2021, as
compared to $253,188 for the three months ended September 30, 2020,
reflecting the first full quarter of operations of the Viactiv
brand, which represented approximately 95% of total revenue for the
period. The Viactiv line of supplements was acquired by the Company
on June 1, 2021.
- Net loss for the
three months ended September 30, 2021 of $(3,014,836) or $(0.12)
per share, as compared to a net loss of $(2,143,494) or $(0.15) per
share for the three months ended September 30, 2020.
-
Cash and short-term investments balance of $10,558,662 and working
capital of $12,896,498 at September 30, 2021.
Additional important events that occurred during
the three months ended September 30, 2021 and subsequently include
the following:
- Completed the
successful integration of the operations of the Viactiv brand and
related systems into the Company’s operations.
- Relocated the
corporate offices from San Diego, California to Houston,
Texas.
- Entered into an
agreement to terminate the lease on the Company’s San Diego,
California corporate office and main warehouse facility, which was
utilized primarily for the Company’s ocular products business. The
termination agreement was effective on October 31, 2021 and is
expected to reduce overhead costs. Guardion moved its product
inventory to an experienced third-party logistics provider.
-
Launched a new and improved corporate and investor website to
better engage with the Company’s investors, customers and other
stakeholders. The website can be accessed at its current URL,
www.guardionhealth.com.
Bret Scholtes, Guardion’s President and Chief
Executive Officer, commented, “We are encouraged by our third
quarter results, which demonstrated measurable progress towards our
goal of building a leading clinical nutrition company. Our revenue
growth, driven by the performance of the recently acquired Viactiv
product line, represents the highest quarterly sales results in
Guardion’s history. We achieved these results despite the
challenging supply chain environment, and our management team is
actively focusing on supply chain matters given industry-wide
constraints. In addition, the Viactiv brand has been completely and
successfully integrated into our business, and we remain confident
in our ability to drive organic growth through expansion of the
Viactiv brand. Our focus is now shifting to ways that we can
successfully leverage the established distribution channels and
brand awareness of Viactiv to accelerate the growth of the Company
into a leader in clinical nutrition.
“Our efforts in the upcoming quarter will be
concentrated on growing the market share of our current products,
while at the same time expanding upon those attributes that we
believe are fundamental to that growth. These include expanding
Viactiv’s brand awareness and consumer acceptance through increased
marketing and development of direct-to-consumer opportunities;
leveraging and expanding our experienced management team;
significantly growing our distribution networks and relationships
while creating opportunities to develop new approaches and
maximizing our product development and launch initiatives. We
believe that this leveraging of the established Viactiv brand will
be critical to establishing a consistent track record of growth in
both revenue and profitability.”
Mr. Scholtes continued, “Over the long-term,
Guardion believes that its success will depend on its ability to
create value in well-differentiated and robust brands through
strong clinically proven claims that address consumer needs in
growing markets, both domestically and internationally. Guardion is
committed to bringing compelling products to market that serve a
distinct need, under meaningful and differentiated brands that are
supported by strong science. We firmly believe that Guardion is now
much better positioned to create value for its shareholders as a
result of the Viactiv acquisition.”
“Mr. Scholtes concluded, “Finally, as we embark
on this important work, we anticipate more opportunities to
increase the frequency of shareholder communications to be able to
report on achieving measurable and tangible milestones as part of
the Company’s overall long-term progress.”
Financial Results Three
Months Ended September 30, 2021 and 2020
Total revenue for the three months ended
September 30, 2021 increased to $3,148,612, as compared total
revenue for the three months ended September 30, 2020 of $253,188.
The significant increase in revenue is due to the Company’s
commercialization of its Viactiv products. We achieved these
results despite the challenging supply chain environment.
Management is actively focusing on supply chain matters in light of
industry-wide supply chain constraints. Through September 30,
2021, the Company has not experienced negative impacts to its
supply chain, however, the Company cannot make any assurances in
future periods.
Operating expenses for the three months ended
September 30, 2021 were $4,403,545, as compared to operating
expenses for the three months ended September 30, 2020 of $
2,290,745.
Net loss for the three months ended September
30, 2021 was $(3,014,836), as compared to net loss for the three
months ended September 30, 2020 of $(2,143,494).
These results of operations are not comparable
to prior periods as we have significantly increased our gross
revenues and cost of goods sold with our acquisition and successful
integration of Activ.
Nine Months Ended September 30, 2021 and
2020
Total revenue for the nine months ended
September 30, 2021 was $4,605,628, as compared total revenue for
the nine months ended September 30, 2020 of $1,689,820. The change
in overall performance in 2021 as compared to 2020 is attributable
to the Company’s acquisition and successful integration of the
Viactiv brand and product line on June 1, 2021.
Operating expenses for the nine months ended
September 30, 2021 were $12,272,371, as compared to operating
expenses for the nine months ended September 30, 2020 of
$6,018,137.
Net loss for the nine months ended September 30,
2021 was $(10,224,649) as compared to net loss for the nine months
ended September 30, 2020 of $(5,197,567).
These results of operations are not comparable
to prior periods as we have significantly increased our gross
revenues and cost of goods sold with our acquisition and successful
integration of Activ.
About Guardion Health Sciences,
Inc.
Guardion Health Sciences, Inc. (Nasdaq: GHSI),
is a clinical nutrition and diagnostics company. Guardion’s
portfolio of science-based, clinically supported nutrition, medical
foods, and diagnostic products support healthcare professionals,
their patients, and consumers in achieving health goals. Guardion’s
commercial and developmental initiatives are supported by equally
impressive scientific and medical advisory boards, led by seasoned
business executives and physicians with many years of experience.
This combination of expertise and scientific knowledge forms the
foundation of Guardion’s growing position within the clinical
nutrition marketplace. 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. These
forward-looking statements contain information about our
expectations, beliefs, plans or intentions regarding our product
development and commercialization efforts, research and development
efforts, business, financial condition, results of operations,
strategies or prospects, and other similar matters. Statements
preceded by, followed by or that otherwise include the words
“believes,” “expects,” “anticipates,” “intends,” “projects,”
“estimates,” “plans,” “hopes” 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 are based on management’s current
expectations and assumptions about future events, which are
inherently subject to uncertainties, risks and changes in
circumstances that are difficult to predict, and 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 integration of new management team members,
the implementation of new financial, management, accounting and
business software systems, the integration of the Viactiv
acquisition and possibly additional acquisition targets, the impact
of the COVID-19 pandemic on the Company’s business, operations and
the economy in general, the Company’s ability to successfully
develop and commercialize its proprietary products and
technologies, and the Company’s ability to maintain compliance with
Nasdaq’s listing requirements. 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, |
|
|
December 31, |
|
|
|
2021 |
|
|
2020 |
|
|
|
|
(Unaudited) |
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets |
|
|
|
|
|
|
|
|
Cash |
|
$ |
3,563,854 |
|
|
$ |
8,518,732 |
|
Short-term investments |
|
|
6,994,808 |
|
|
|
- |
|
Accounts receivable, net |
|
|
2,268,623 |
|
|
|
11,248 |
|
Inventories |
|
|
792,633 |
|
|
|
384,972 |
|
Prepaid expenses |
|
|
1,246,711 |
|
|
|
179,931 |
|
|
|
|
|
|
|
|
|
|
Total current
assets |
|
|
14,866,629 |
|
|
|
9,094,883 |
|
|
|
|
|
|
|
|
|
|
Property and equipment,
net |
|
|
269,487 |
|
|
|
285,676 |
|
Intangible assets, net |
|
|
11,553,333 |
|
|
|
50,000 |
|
Goodwill |
|
|
11,893,134 |
|
|
|
- |
|
Deposits |
|
|
1,282 |
|
|
|
11,751 |
|
Right of use asset, net |
|
|
29,305 |
|
|
|
418,590 |
|
|
|
|
|
|
|
|
|
|
Total
assets |
|
$ |
38,613,170 |
|
|
$ |
9,860,900 |
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders’ Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
1,182,955 |
|
|
$ |
608,313 |
|
Accrued expenses |
|
|
473,257 |
|
|
|
127,637 |
|
Operating lease liability – current |
|
|
313,909 |
|
|
|
162,845 |
|
Payable to former officer |
|
|
- |
|
|
|
148,958 |
|
Derivative warrant liability |
|
|
- |
|
|
|
25,978 |
|
|
|
|
|
|
|
|
|
|
Total current
liabilities |
|
|
1,970,121 |
|
|
|
1,073,731 |
|
|
|
|
|
|
|
|
|
|
Operating lease liability –
long term |
|
|
- |
|
|
|
271,903 |
|
|
|
|
|
|
|
|
|
|
Total
liabilities |
|
|
1,970,121 |
|
|
|
1,345,634 |
|
|
|
|
|
|
|
|
|
|
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; 24,426,993 shares and
15,170,628 shares issued and outstanding at September 30, 2021 and
December 31, 2020, respectively |
|
|
24,427 |
|
|
|
15,171 |
|
Additional paid-in
capital |
|
|
100,900,334 |
|
|
|
62,583,423 |
|
Accumulated deficit |
|
|
(64,281,712 |
) |
|
|
(54,083,328 |
) |
|
|
|
|
|
|
|
|
|
Total stockholders’
equity |
|
|
36,643,049 |
|
|
|
8,515,266 |
|
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders’ equity |
|
$ |
38,613,170 |
|
|
$ |
9,860,900 |
|
|
|
|
|
|
|
|
|
|
|
Guardion Health Sciences, Inc.Condensed
Consolidated Statements of Operations (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months EndedSeptember
30, |
|
|
Nine Months EndedSeptember
30, |
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Clinical nutrition |
|
$ |
3,109,525 |
|
|
$ |
142,556 |
|
|
$ |
4,443,113 |
|
|
$ |
1,446,584 |
|
Diagnostics equipment |
|
|
39,087 |
|
|
|
110,632 |
|
|
|
162,515 |
|
|
|
237,136 |
|
Other |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
6,100 |
|
Total
revenue |
|
|
3,148,612 |
|
|
|
253,188 |
|
|
|
4,605,628 |
|
|
|
1,689,820 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Clinical nutrition |
|
|
1,730,318 |
|
|
|
68,956 |
|
|
|
2,454,423 |
|
|
|
764,245 |
|
Diagnostics equipment |
|
|
30,268 |
|
|
|
45,157 |
|
|
|
104,417 |
|
|
|
101,077 |
|
Other |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
2,478 |
|
Total cost of goods
sold |
|
|
1,760,586 |
|
|
|
114,113 |
|
|
|
2,558,840 |
|
|
|
867,800 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
|
1,388,026 |
|
|
|
139,075 |
|
|
|
2,046,788 |
|
|
|
822,020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
16,234 |
|
|
|
34,034 |
|
|
|
53,598 |
|
|
|
109,803 |
|
Sales and marketing |
|
|
777,526 |
|
|
|
167,213 |
|
|
|
1,754,321 |
|
|
|
1,175,126 |
|
General and administrative |
|
|
3,297,725 |
|
|
|
2,070,998 |
|
|
|
8,048,713 |
|
|
|
5,299,696 |
|
Transaction costs related to acquisition of Activ Nutritional,
LLC |
|
|
- |
|
|
|
- |
|
|
|
2,103,680 |
|
|
|
- |
|
Impairment of right of use asset and lease deposit |
|
|
280,176 |
|
|
|
- |
|
|
|
280,176 |
|
|
|
- |
|
Impairment loss on equipment held for sale |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
30,948 |
|
Loss on disposal of fixed assets |
|
|
31,883 |
|
|
|
18,500 |
|
|
|
31,883 |
|
|
|
18,500 |
|
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 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses |
|
|
4,403,545 |
|
|
|
2,290,745 |
|
|
|
12,272,371 |
|
|
|
6,018,137 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations |
|
|
(3,015,518 |
) |
|
|
(2,151,670 |
) |
|
|
(10,225,583 |
) |
|
|
(5,196,117 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
- |
|
|
|
(3,716) |
|
|
|
(14 |
) |
|
|
(7,254 |
) |
Interest income |
|
|
682 |
|
|
|
- |
|
|
|
948 |
|
|
|
- |
|
Change in fair value of derivative liability |
|
|
- |
|
|
|
11,892 |
|
|
|
|
|
|
|
5,804 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other income
(expense) |
|
|
682 |
|
|
|
8,176 |
|
|
|
934 |
|
|
|
(1,450 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(3,014,836 |
) |
|
$ |
(2,143,494 |
) |
|
$ |
(10,224,649 |
) |
|
$ |
(5,197,567 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share –
basic and diluted |
|
$ |
(0.12 |
) |
|
$ |
(0.15 |
) |
|
$ |
(0.44 |
) |
|
$ |
(0.37 |
) |
Weighted average common shares
outstanding – basic and diluted |
|
|
24,426,993 |
|
|
|
14,720,087 |
|
|
|
23,413,055 |
|
|
|
14,088,395 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended September 30, 2021 |
|
|
|
Corporate |
|
|
Clinical Nutrition |
|
|
Diagnostics Equipment |
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
- |
|
|
$ |
3,109,525 |
|
|
$ |
39,087 |
|
|
$ |
3,148,612 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold |
|
|
- |
|
|
|
1,730,318 |
|
|
|
30,268 |
|
|
|
1,760,586 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
|
|
|
|
|
1,379,207 |
|
|
|
8,819 |
|
|
|
1,388,026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock compensation
expense |
|
|
364,448 |
|
|
|
- |
|
|
|
- |
|
|
|
364,448 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses |
|
|
1,166,837 |
|
|
|
2,802,886 |
|
|
|
69,373 |
|
|
|
4,039,097 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations |
|
$ |
(1,531,285 |
) |
|
$ |
(1,423,679 |
) |
|
$ |
(60,554 |
) |
|
$ |
(3,015,518 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended September 30, 2020 |
|
|
|
Corporate |
|
|
Clinical Nutrition |
|
|
Diagnostics Equipment |
|
|
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 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock compensation
expense |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses |
|
|
1,202,402 |
|
|
|
1,081,897 |
|
|
|
6,446 |
|
|
|
2,290,745 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations |
|
$ |
(1,202,402 |
) |
|
$ |
(1,008,296 |
) |
|
$ |
59,028 |
|
|
$ |
(2,151,670 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Nine Months Ended September 30, 2021 |
|
|
|
Corporate |
|
|
Clinical Nutrition |
|
|
Diagnostics Equipment |
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
- |
|
|
$ |
4,443,112 |
|
|
$ |
162,516 |
|
|
$ |
4,605,628 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of goods
sold |
|
|
- |
|
|
|
2,454,402 |
|
|
|
104,418 |
|
|
|
2,558,819 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
|
- |
|
|
|
1,988,711 |
|
|
|
58,098 |
|
|
|
2,046,809 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock compensation
expense |
|
|
1,095,155 |
|
|
|
- |
|
|
|
- |
|
|
|
1,095,155 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses |
|
|
5,076,756 |
|
|
|
5,917,798 |
|
|
|
182,683 |
|
|
|
11,177,237 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations |
|
$ |
(6,171,911 |
) |
|
$ |
(3,929,088 |
) |
|
$ |
(124,585 |
) |
|
$ |
(10,225,583 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Nine Months Ended September 30, 2020 |
|
|
|
Corporate |
|
|
Clinical Nutrition |
|
|
Diagnostics Equipment |
|
|
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 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock compensation
expense |
|
|
|
|
|
|
- |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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